May 27, 2005

 

 

Mimi Hull, President 

ASSOCIATION OF U S WEST RETIREES

Board Members and General members

 

 

This is a follow-up to my April 27, 2005, email sent reporting a letter we sent that day to Qwest.  The letter was sent to Qwest because we learned that Qwest had recently filed an amended Form 5500 Schedule C for the Qwest Pension Plan, which amended schedule showed revised figures reflecting over $46 million in payments from the Qwest Pension Plan to numerous ‘service providers.’  The amended Schedule C report for year 2002 filed on or about March 15, 2005, was quite different from the original report filed on or about October 15, 2003, which showed $36 million in payments from the Qwest Pension Plan to numerous 'service providers.'  Indeed, the difference was well over $10 million.  We attached to the letter sent to Qwest a spreadsheet (prepared by Qwest retirees) comparing the two Schedule C reports.  We told Qwest that Mr. Phelps and numerous other Qwest retirees wished to know the reason for all the discrepancies and errors reported on the initial filed report.

 

 

By letter dated May 20, Qwest Director of Compensation & Benefits Felicity O'Herron responded.  While maintaining that Mr. Phelps and no other retiree is entitled to any explanation, she says the company in good faith was giving an explanation.  I believe that, due to the pending litigation in Phelps v. Qwest, the company is making a better effort to respond to inquiries about the condition of the Qwest Pension Plan and the annual reports.

 

 

In her May 20 response letter, Ms. O'Herron gives the following explanation for the $10 million discrepancy between the October 2003 and the March 2005 reports:  "The original Schedule C filed for Plan Year 2002 was completed on a cash basis by a former auditor.  The 2002 filing was amended in March 2005 using the accrual basis."

 

 

So that you may have a full understanding, a copy of both our April 27, 2005, request for explanation and the May 20, 2005, response letter is attached hereto.