United States Securities and Exchange Commission
Washington, D.C. 20549
Form 11-K
(Mark One)
[X] Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of
1934
For the fiscal year ended December 31, 2007
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or
--
[ ] Transition Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934
For the transition period from _____ to _____
Commission file number 001-11001
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Citizens 401(k) Savings Plan
----------------------------
(Full title of the Plan)
Citizens Communications Company
3 High Ridge Park
P.O. Box 3801
Stamford, CT 06905
--------------------------------
(Name of issuer of the securities held
pursuant to the Plan and the address
of its principal executive offices)
CITIZENS 401(k) SAVINGS PLAN
Financial Statements and Supplemental Schedule
December 31, 2007 and 2006
(With Report of Independent Registered Public Accounting Firm)
CITIZENS 401(k) SAVINGS PLAN
Table of Contents
Page
----
Report of Independent Registered Public Accounting Firm 1
Financial Statements:
Statements of Net Assets Available for Benefits - December 31, 2007 and 2006 2
Statement of Changes in Net Assets Available for Benefits for the Year Ended December 31, 2007 3
Notes to Financial Statements 4-11
Supplemental Schedules:*
Schedule H, Line 4(i) - Schedule of Assets (Held at End of Year) as of December 31, 2007 12
Signature 13
Consent of Independent Registered Public Accounting Firm 14
* Schedules required by Form 5500 that are not applicable have not been
included.
Report of Independent Registered Public Accounting Firm
To the Participants and Plan Administrator
of the Citizens 401(k) Savings Plan:
We have audited the statements of net assets available for benefits of the
Citizens 401(k) Savings Plan (the "Plan") as of December 31, 2007 and 2006, and
the related statement of changes in net assets available for benefits for the
year ended December 31, 2007. These financial statements are the responsibility
of the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with the auditing standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 2007 and 2006 and the changes in net assets available for benefits
for the year ended December 31, 2007, in conformity with accounting principles
generally accepted in the United States of America.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedule H, Schedule of
Assets (Held at End of Year), as of December 31, 2007 is presented for the
purpose of additional analysis and is not a required part of the basic financial
statements but is supplementary information required by the United States
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. This supplemental schedule
is the responsibility of the Plan's management. This supplemental schedule has
been subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ Insero & Company CPAs, P.C.
Certified Public Accountants
Insero & Company CPAs, P.C.
Certified Public Accountants
Rochester, New York
June 27, 2008
1
CITIZENS 401(k) SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 31, 2007 and 2006
2007 2006
------------------- -------------------
Assets:
Cash and Cash Equivalents:
Uninvested Cash $ 5,236 $ 57,133
Investments (note 3):
Citizens Communications Company common stock 45,619,389 56,348,759
Mutual funds 206,592,837 198,833,321
Collective trusts 138,288,173 137,350,003
Participant loans 15,331,796 15,795,960
Brokerage accounts 546,128 184,248
------------------- -------------------
Total investments, at fair value 406,378,323 408,512,291
Receivables:
Receivable from Commonwealth Builder 401(k) Plan 50,229,514 -
Employer contributions 161,743 343,066
Participant contributions 721,853 1,504,766
------------------- -------------------
Total receivables 51,113,110 1,847,832
------------------- -------------------
Net assets available for benefits, at fair value 457,496,669 410,417,256
------------------- -------------------
Adjustment from fair value to contract value for
interest in collective trust relating to fully benefit-
responsive investment contracts (434,665) 605,079
------------------- -------------------
Net assets available for benefits $ 457,062,004 $ 411,022,335
=================== ===================
See accompanying notes to financial
statements.
2
CITIZENS 401(k) SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 2007
Additions to net assets attributed to: 2007
-------------------
Investment income:
Dividends $ 27,980,901
Interest 1,024,916
Net depreciation in fair value of investments (note 3) (12,335,139)
-------------------
16,670,678
-------------------
Contributions:
Participant 21,276,487
Employer 5,074,962
Rollover 877,191
-------------------
27,228,640
-------------------
Total additions 43,899,318
-------------------
Deductions from net assets attributed to:
Distributions to participants (48,089,163)
-------------------
Total deductions (48,089,163)
-------------------
Transfer from Commonwealth Builder 401(k) Plan 50,229,514
-------------------
Net increase in net assets available for benefits 46,039,669
Net assets available for benefits:
Beginning of year 411,022,335
-------------------
End of year $ 457,062,004
===================
See accompanying notes to financial
statements.
3
CITIZENS 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 2007 and 2006
(1) Description of the Plan
General
The following brief description of the Citizens 401(k) Savings Plan
(the "Plan") provides general information. Participants should refer
to the Plan document for a more comprehensive description of the
Plan's provisions. Copies of the Plan document are available from the
Plan sponsor.
(a) Background
The Plan is a defined contribution plan sponsored and managed by
Citizens Communications Company (the "Company"). Under the terms
of the Plan, employees are eligible to participate in the Plan as
of the first day of the month (the "entry date") immediately
following the employee's completion of 30 days of service,
provided that the employee is employed by a participating
employer in an eligible class of employees. Leased employees,
individuals not on the employer's payroll, per diem and casual
workers, temporary employees, and scholarship students are
ineligible to participate. The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 ("ERISA").
On March 8, 2007, Citizens Communications Company acquired
Commonwealth Telephone Enterprises, Inc. Effective December 31,
2007, the Commonwealth Builder 401(k) Plan was merged into the
Plan. However, the funds had not been remitted to the Plan as of
such date. Accordingly, the amounts due to the Plan are reflected
as a Receivable from Commonwealth Builder 401(k) Plan in the
Statement of Net Assets Available for Benefits as of December 31,
2007, and included as a Transfer from Commonwealth Builder 401(k)
Plan in the Statement of Changes in Net Assets Available for
Benefits for the year ended December 31, 2007. The funds were
transferred from the Commonwealth Builder 401(k) Plan to the Plan
during early January, 2008. The Plan merger resulted in a
"blackout period" beginning December 20, 2007 and ending January
18, 2008 for the former participants of the Commonwealth Builder
401(k) Plan. During this period, the former participants of the
Commonwealth Builder 401(k) Plan were unable to exercise the
rights otherwise available under the Plan or the Commonwealth
Builder 401(K) Plan.
(b) Contributions
Eligible employees may contribute, in 1% increments, up to 75% of
their annual eligible compensation in elective pre-tax deferrals
through payroll deductions, subject to certain maximum
contribution restrictions. The maximum contribution allowed for
deferral for U.S. federal income tax purposes in 2007 was
$15,500.
In addition, eligible Frontier union employees covered by
collective bargaining agreements may also elect to make after-tax
contributions, in 1% increments of their annual eligible
compensation, through payroll deductions up to (i) 50% of the
participant's eligible compensation reduced by (ii) the
percentage of eligible compensation deferred through elective
pre-tax deferrals.
All employees eligible to make contributions under the Plan and
who have attained or will attain age 50 before the close of the
Plan year shall be eligible to make catch-up contributions in
accordance with, and subject to the limitations of, Section
414(v) of the Internal Revenue Code ("IRC"). The maximum
allowable catch-up contribution for 2007 was $5,000. No matching
contributions are made with respect to a participant's catch-up
contributions.
4
The Company contributes 50% of each non-bargaining participant's
contribution up to 6% of each participant's eligible
compensation. Company contributions for participants covered by
collective bargaining agreements are determined based on the
terms of those agreements. The Company contributions for
non-union and certain union participants are allocated to Plan
investments following the same method of allocation as that for
participant-directed investments.
For certain union employees covered by collective bargaining
agreements, the Company may contribute Employer Fixed
Contributions, Employer Matching Contributions, Discretionary
Contributions and Special Transition-Year Contributions (each as
defined by the Plan). Participants should refer to their
respective bargaining agreements for all employer contribution
requirements.
Supplemental Profit Sharing Matches may be contributed,
contingent upon the Company exceeding certain financial targets.
For each 1% above the Company's operating income plus
depreciation and amortization ("EBITDA") goal approved by the
Company's Board of Directors, the Company provides eligible
employees with 0.5% of eligible pay in the form of a matching
contribution into the 401(k) Plan, up to a maximum of 3%. Only
non-union and certain union employees who have contributed at
least 1% of their eligible pay during the year as elective
deferrals are eligible for a Supplemental Profit Sharing Match.
For the year ended December 31, 2007, the Company did not exceed
its EBITDA goal and therefore no supplemental profit sharing
match was made on behalf of the employees.
In 2007, the Company offered a supplemental contribution under a
Voluntary Separation Enhancement Program ("VSEP"). Employees who
elected to participate in the VSEP received a contribution
ranging from $1,000 up to a maximum of $25,000, depending on
years of service.
(c) Participant Accounts
Each participant's account is credited with the participant's
contribution and an allocation of (a) the Company's contribution
and (b) investment earnings or losses. Allocations are based on
each participant's investment election(s). The benefit to which a
participant is entitled is the amount that can be provided from
the participant's vested account.
(d) Vesting
Participants are vested immediately in their contributions plus
the allocated earnings thereon. Participants become 100% vested
in the Company contributions and the related earnings on the
Company contributions upon disability, death, or attainment of
normal retirement age while an employee. Except as otherwise
noted, for any other termination of employment, the vesting
schedule for Company contributions and related earnings is as
follows:
Vesting
Years of Service Percentage
------------------------------ ------------------
Less than 2 years 0%
2 years but less than 3 years 40%
3 years but less than 4 years 60%
4 years but less than 5 years 80%
5 years or more 100%
5
Frontier union employees and certain other employees covered by
collective bargaining agreements are immediately 100% vested in
all contributions and allocated earnings thereon.
(e) Participant Loans
Participants in the Plan may request to borrow up to the lesser
of 50% of their vested account balance or $50,000. The interest
rate paid by the participant is equal to the prime interest rate
in effect at the beginning of the month in which the loan is
processed and remains fixed at that rate for the term of the
loan. Loan repayments are after tax, and are credited to each
participant's account as the payments are made. A participant may
repay a loan in full at any time by remitting his/her payment
directly to the trustee of the Plan. Any distribution following a
participant's termination of employment is reduced by any loan
balance outstanding at the time of such distribution.
(f) Payment of Benefits
Inactive participants do not have the option to keep any portion
of their account in the Plan beyond the attainment of age 70 1/2.
Participants still employed by the Company at age 70 1/2, must
take a full distribution of their balances on or before April 1st
of the calendar year after they retire.
Upon termination of employment or permanent disability, a
participant is entitled to receive payment in full of the vested
portion of his/her account. If the value of the terminating
participant's vested account balance does not exceed $1,000, the
participant's balance will be distributed automatically at that
time.
In-service withdrawals are also permitted under limited
circumstances such as attaining age 59 1/2 or financial hardship.
(g) Forfeitures
Forfeitures of nonvested Company contributions are applied first
to the payment of Plan administrative expenses, to the extent not
previously paid by the Company, with any excess being applied to
reduce future contributions of the Company. For the year ended
December 31, 2007, forfeited nonvested Company contributions
totaled approximately $273,000. Forfeited nonvested Company
contributions of $0 were used to fund Plan administrative
expenses, and approximately $425,000 (including amounts remaining
from prior years) was used to partially fund the Company
contributions for the year ended December 31, 2007.
(h) Administrative Expenses
The administrative expenses of the Plan are paid by the Plan or
by the Company. The majority of Plan administrative expenses paid
by participants relate to investment management fees which are
deducted from participant account balances.
6
(i) Investments
The Plan offered the following 17 investment options as of
December 31, 2007:
Citizens Communications Company Common Stock
PIMCO Total Return Fund, Admin. Shares
PIMCO Long Term U.S. Government Fund, Admin.
Columbia Mid Cap Index, Z
JP Morgan Diversified Mid Cap Growth Fund
JP Morgan Mid Cap Value Fund, A
Morgan Stanley Institutional Small Company Growth
Portfolio, B
American Funds Europacific Growth Fund R5
Morgan Stanley Institutional U.S. Real Estate Fund, B
T. Rowe Price Stable Value Fund
T. Rowe Price Equity Index Trust
T. Rowe Price Equity Income Fund
T. Rowe Price Growth Stock Fund
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund
T. Rowe Price TradeLink
The Plan restricts a participant's ability to invest in Citizens
Communications Company common stock if the value of the Company
stock fund exceeds 15% of the total value of the participant's
account. In addition, a participant is restricted from investing
more than 15% of current contributions in the Company stock fund.
(j) Mutual Fund Fees
Investments in mutual funds are subject to sales charges and
annual fees for marketing and distribution costs of the funds.
These fees are deducted prior to the allocation of the investment
earnings activity and thus not separately identifiable as an
expense of the Plan.
(2) Summary of Significant Accounting Policies
(a) Basis of Accounting
The financial statements of the Plan are prepared under the
accrual method of accounting.
(b) Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions
that affect the reported amount of assets, liabilities, changes
therein, and disclosures of contingent assets and liabilities at
the date of the financial statements. The preparation of these
financial statements also requires the use of plan administrator
estimates. Actual results may differ from these estimates.
7
(c) Investments
The Plan's investments are stated at fair value. Shares of
registered investment companies (mutual funds) are valued at
quoted market prices, which represent the net asset value of
shares held by the Plan. The Plan's interest in collective trusts
are valued based on information reported by the investment
advisor using the audited financial statements of the collective
trust at year-end. Common stock is valued at its quoted market
price as of the end of the Plan year. Participant loans are
valued at cost, which approximates fair value. In addition, the
Plan offers a brokerage option, Tradelink, whereby participants
invest in publicly traded mutual funds not offered directly by
the Plan. The net depreciation in fair value of investments
consists of the net realized gains and losses on the disposal of
investments during 2007 and the net unrealized
appreciation/depreciation of the market value for the investments
remaining in the Plan as of December 31, 2007.
Purchases and sales of securities are recorded on a trade-date
basis. Interest income is recorded on the accrual basis.
Dividends are recorded on the dividend date.
(d) Fully Benefit-Responsive Investment Contracts
As described in Financial Accounting Standards Board Staff
Position, FSP AAG INV-1 and SOP 94-4-1, Reporting of Fully
Benefit-Responsive Investment Contracts Held by Certain
Investment Companies Subject to the AICPA Investment Company
Guide and Defined Contribution Health and Welfare and Pension
Plans (the FSP), investment contracts held by a defined
contribution plan are required to be reported at fair value.
However, contract value is the relevant measurement attribute for
that portion of the net assets available for benefits of a
defined contribution plan attributable to fully
benefit-responsive investment contracts because contract value is
the amount participants would receive if they were to initiate
permitted transactions under the terms of the Plan. The Plan
invests in investment contracts through a collective trust. As
required by the FSP, the Statements of Net Assets Available for
Benefits presents the fair value of the investment in the
collective trust as well as the adjustment of the investment in
the collective trust from fair value to contract value relating
to the investment contracts. The Statement of Changes in Net
Assets Available for Benefits is prepared on a contract value
basis.
(e) Benefits Paid
Distributions to participants are recorded when paid.
(f) Risks and Uncertainties
The Plan offers a number of investment options including the
Company's common stock and a variety of pooled investment funds,
some of which are registered investment companies. The investment
funds principally include U.S. equities, international equities,
and fixed income securities. Investment securities, in general,
are exposed to various risks, such as interest rate, credit, and
overall market volatility risk. Due to the level of risk
associated with certain investment securities, it is reasonable
to expect that changes in the values of investment securities
will occur in the near term and that such changes could
materially affect participant account balances.
8
The Plan's exposure to a concentration of issuer risk is limited
by the diversification of investments across all
participant-directed fund elections except for the Company Common
Stock Fund, which is invested in the security of a single issuer.
Additionally, the investments within certain participant-directed
fund elections may be further diversified into varied financial
instruments.
(g) New Accounting Pronouncements
In September 2006, the FASB issued Statement of Financial
Accounting Standards No. 157, "Fair Value Measurements," ("SFAS
No. 157") which defines fair value, establishes a framework for
measuring fair value in generally accepted accounting principles
and expands disclosure requirements about fair value
measurements. SFAS No. 157 is effective for financial statements
issued for fiscal years beginning after November 15, 2007. The
Plan is currently evaluating the effect that the provisions of
SFAS No. 157 will have on the Plan's financial statements.
(3) Investments
The following presents investments at fair value that represent 5% or
more of the Plan's net assets at the end of year:
2007 2006
---------------- ------------------
Citizens Communications Company Common Stock Fund:
Participant-Directed, 3,439,290 and 3,770,805 shares,
respectively $ 43,782,154 $ 54,186,468
Company-Directed, 144,323 and 150,473 shares, respectively 1,837,235 2,162,291
PIMCO Total Return Fund, Admin. Shares 26,886,218 26,133,941
Morgan Stanley Institutional International Equity Portfolio, B - 32,703,399
T. Rowe Price Growth Stock Fund 33,080,524 29,677,168
T. Rowe Price Stable Value Fund 73,543,161 70,581,648
T. Rowe Price Equity Index Trust 64,745,012 66,768,355
T. Rowe Price Equity Income Fund *** 21,817,534
American Funds Europacific Growth R5 33,891,025 -
*** Fund represents less than 5% of the Plan net assets at end of year
Citizens Communications Company Common Stock Fund includes investments
in Citizens Communications common stock and additional uninvested
cash.
9
During 2007, the Plan's investments (including gains and losses on
investments bought and sold as well as held during the year)
depreciated in value by $12,335,139 as follows:
2007
----------------
Common stock $ (5,818,444)
Mutual funds (10,083,250)
Collective trusts 3,566,555
----------------
$ (12,335,139)
================
(4) Company-Directed Investments
Information about the assets available for benefits and significant
components of the changes in assets available for benefits relating to
the nonparticipant-directed investments is as follows:
2007 2006
----------------- -----------------
Assets:
Common stock of the Company at December 31 $ 1,837,235 $ 2,162,291
================= =================
Changes in assets:
Dividends $ 142,760 $ 203,639
Net change in fair value of investments (313,607) 429,910
Distributions to participants (154,209) (1,631,739)
----------------- -----------------
Change in assets $ (325,056) $ (998,190)
================= =================
(5) Related Party Transactions
Certain Plan assets are invested in shares of mutual funds and
collective trust funds that are managed by T. Rowe Price. T. Rowe
Price is the trustee as defined by the Plan and, therefore,
transactions involving these assets qualify as party-in-interest
transactions. There were no trustee fees paid by the Company to T.
Rowe Price for the years ended December 31, 2007 and 2006.
(6) Plan Termination
Although it has not expressed any intention to do so, the Company has
the right under the Plan to discontinue its contributions at any time
and to terminate the Plan subject to the provisions of ERISA,
Collective Bargaining Agreements and the National Labor Relations
Board. In the event of plan termination, participants will become 100%
vested in their accounts.
(7) Tax Status
The Plan received a favorable determination letter from the Internal
Revenue Service dated January 9, 2006, indicating that it meets the
requirements of Section 401(a) and 501(a) of the Internal Revenue Code
("IRC") and has qualified status as an employee retirement plan. The
Plan has been amended since receiving the determination letter and has
applied for a new determination letter as of January 31, 2008.
However, the Plan administrator and the Plan's tax counsel believe
that the Plan is currently designed and being operated in compliance
with the applicable requirements of the IRC.
10
(8) Reconciliation of Financial Statements to Form 5500
The following is a reconciliation from the financial statements to the
Form 5500 at December 31, 2007:
Net Assets Available for Benefits per the Financial Statements $ 457,062,004
Adjustment from contract value to fair value for interest in
collective trust relating to fully benefit-responsive
investment contracts 434,665
------------------
Net Assets Available for Benefits per the Form 5500 $ 457,496,669
==================
Net Increase in Net Assets Available for Benefits per the
Financial Statements $ 46,039,669
Change in adjustment from contract value to fair value for
interest in collective trust relating to fully benefit-responsive
investment contracts 1,039,744
------------------
Net Income per the Form 5500 $ 47,079,413
==================
(9) Subsequent Event
Effective July 31, 2008, Citizens Communications Company ("CZN") is
changing its name and stock symbol to Frontier Communications
Corporation ("FTR").
11
CITIZENS 401(k) SAVINGS PLAN
EIN #: 06-0619596 Plan #005
Schedule H, Line 4(i) - Schedule of Assets (Held at End of Year)
December 31, 2007
(a) (b) (c) and (d) (e)
Identity of Issuer Description of Investment Current Value
----------------------------------------------------------------------------------------------------------------------------------
* Citizens Communications Company Common Stock; 3,583,613 shares; cost at $42,781,751 $ 45,619,389
-------------
* T. Rowe Price TradeLink Brokerage Accounts; 546,128 shares 546,128
-------------
American Funds Europacific Growth Fund R5 Mutual Fund; 666,228 shares 33,891,025
Columbia Mid Cap Index, Z Mutual Fund; 626,358 shares 7,372,232
PIMCO Total Return Fund, Admin. Shares Mutual Fund; 2,515,081 shares 26,886,218
JP Morgan Diversified Mid Cap Growth Fund Mutual Fund; 581,247 shares 12,868,817
JP Morgan Mid Cap Value Fund, A Mutual Fund; 404,953 shares 9,783,667
PIMCO Long Term U.S. Government Fund, Admin. Mutual Fund; 378,524 shares 4,175,124
Morgan Stanley Institutional Small Company Growth
Portfolio, B Mutual Fund; 1,476,463 shares 18,293,372
Morgan Stanley Institutional U.S. Real Estate Fund, B Mutual Fund; 646,903 shares 10,046,406
* T. Rowe Price Personal Strategy Balance Fund Mutual Fund; 652,171 shares 12,560,817
* T. Rowe Price Personal Strategy Incoome Fund Mutual Fund; 408,853 shares 6,414,908
* T. Rowe Price Growth Stock Fund Mutual Fund; 982,784 shares 33,080,524
* T. Rowe Price Equity Income Fund Mutual Fund; 805,444 shares 22,632,971
* T. Rowe Price Personal Strategy Growth Fund Mutual Fund; 351,340 shares 8,586,756
-------------
Total mutual funds 206,592,837
* T. Rowe Price Stable Value Fund Collective Trust; 73,108,496 shares 73,543,161
* T. Rowe Price Equity Index Trust Collective Trust; 1,443,590 shares 64,745,012
-------------
Total collective trusts 138,288,173
-------------
* Participant loans 3,480 loans, maturing in 1 to 17 years, with
interest rates ranging from 4.0% to 9.5% 15,331,796
-------------
$ 406,378,323
=============
* Party-in-interest as defined by ERISA
See accompanying independent
auditors' report.
12
CITIZENS 401(k) SAVINGS PLAN
Signature
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administrators have duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
Citizens 401(k) Savings Plan
By /s/ Robert J. Larson
----------------------------------------
Robert J. Larson
Senior Vice President and Chief Accounting Officer
(On behalf of Citizens Communications Company as
Plan Administrator)
June 27, 2008
13
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in Registration Statements on Form
S-8 (Nos. 33-48683, 333-91054, and 333-151246) of Citizens Communications
Company of our report dated June 27, 2008, relating to the statements of net
assets available for benefits of the Citizens 401(k) Savings Plan as of December
31, 2007 and 2006, and the related statement of changes in net assets available
for benefits for the year ended December 31, 2007, which report appears in the
Annual Report on Form 11-K.
/s/ Insero & Company CPAs, P.C.
Certified Public Accountants
Rochester, New York
June 27, 2008
14