President's Letter
Dear Valued Client,
In August of 1997, I assumed leadership of Aetna's retirement, investment, and
life insurance areas, known collectively as Aetna Retirement Services (ARS).
Through its operating companies, ARS provides individuals with a full range of
financial services, investment management, and other important products and
services. I'm delighted to be heading this company because our mission is to
help people clarify, plan for, and achieve their personal retirement dreams.
That's a mission that's important to us and to you.
Overall, 1997 proved to be another strong year for the stock market. The year
began with some skepticism as to whether or not stocks could produce a third
consecutive year of 20%-plus total returns. At year end, the turbulence in the
Asian markets contributed to wild swings in domestic markets. And, in spite of
it all, the S & P 500 Index rose more than 33%, while the Dow Jones Industrial
Average climbed nearly 25%. The resilience of the market helped equity investors
enjoy yet another year of record returns.*
In the fall of 1997, the ARS organization formed a management investment company
named Portfolio Partners, Inc. (PPI) in order to give many of our clients access
to a wider array of fund management styles, with reduced fees. With the addition
of PPI, our variable insurance product investment options include funds
subadvised by T. Rowe Price Associates, Inc., Massachusetts Financial Services,
Inc. (MFS), and Scudder Kemper Investments, Inc. (Scudder). Aetna funds,
subadvised by Aeltus Investment Management, Inc., remain in our expanding list
of fund families, and together, give you valuable diversification across
markets.
Market swings, economic twists, changes in state and federal tax laws. All offer
opportunities - and confusion - for investors. That's why it's so important for
you to pursue an investment strategy that fits your needs and to wisely choose
your retirement planning partner. Thank you for choosing Aetna Retirement
Services, and for your continued trust and business.
Sincerely,
/s/ Thomas J. McInerney
- -----------------------
Thomas J. McInerney
*Past performance is no indication of future results.
<PAGE>
Variable Annuity Account C
Statement of Assets and Liabilities - December 31, 1997
<TABLE>
<S> <C>
ASSETS:
Investments, at net asset value: (Note 1)
Aetna Variable Fund; 189,402,635 shares (cost $5,932,019,068) ........................ $ 6,370,594,954
Aetna Income Shares; 29,481,519 shares (cost $379,976,337) ........................... 378,848,309
Aetna Variable Encore Fund; 17,984,272 shares (cost $234,633,355) .................... 240,346,197
Aetna Investment Advisers Fund, Inc.; 61,720,862 shares (cost $848,048,432) .......... 989,547,679
Aetna GET Fund, Series B; 5,058,054 shares (cost $56,606,586) ........................ 79,552,932
Aetna GET Fund, Series C; 18,780,804 shares (cost $190,080,319) ...................... 236,822,693
Aetna Ascent Variable Portfolio; 5,107,825 shares (cost $66,607,510) ................. 72,115,304
Aetna Crossroads Variable Portfolio; 3,801,191 shares (cost $47,125,006) ............. 49,739,310
Aetna Legacy Variable Portfolio; 2,710,978 shares (cost $32,214,576) ................. 32,802,912
Aetna Variable Portfolios, Inc.:
Aetna Variable Capital Appreciation Portfolio; 171,171 shares (cost $2,313,642) ..... 2,039,640
Aetna Variable Growth Portfolio; 111,560 shares (cost $1,335,706) ................... 1,098,483
Aetna Variable Index Plus Portfolio; 5,933,809 shares (cost $76,210,503) ............ 83,175,077
Aetna Variable Small Company Portfolio; 388,120 shares (cost $5,122,912) ............ 4,956,212
Calvert Social Balanced Portfolio; 27,469,430 shares (cost $47,247,774) .............. 54,444,411
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio; 7,855,657 shares (cost $156,737,051) ....................... 190,735,350
Growth Portfolio; 3,457,071 shares (cost $105,862,746) .............................. 128,257,345
Overseas Portfolio; 700,480 shares (cost $13,223,729) ............................... 13,449,206
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio; 1,288,137 shares (cost $19,277,286) ........................ 23,199,341
Contrafund Portfolio; 12,866,038 shares (cost $206,330,826) ......................... 256,548,805
Index 500 Portfolio; 504,605 shares (cost $46,209,224) .............................. 57,721,771
Janus Aspen Series:
Aggressive Growth Portfolio; 10,248,197 shares (cost $174,115,177) .................. 210,600,444
Balanced Portfolio; 2,143,788 shares (cost $32,647,487) ............................. 37,451,981
Flexible Income Portfolio; 1,252,635 shares (cost $14,374,926) ...................... 14,756,039
Growth Portfolio; 4,330,541 shares (cost $68,345,213) ............................... 80,028,403
Worldwide Growth Portfolio; 18,350,150 shares (cost $366,705,134).................... 429,210,001
Lexington Emerging Markets Fund; 649,673 shares (cost $6,756,872)..................... 5,788,593
Lexington Natural Resources Trust Fund; 2,881,672 shares (cost $41,178,832)........... 42,965,725
Portfolio Partners, Inc. (PPI):
PPI MFS Emerging Equities Portfolio; 8,228,209 shares (cost $356,891,357)............. 352,990,165
PPI MFS Research Growth Portfolio; 23,381,050 shares (cost $231,196,214).............. 227,029,997
PPI MFS Value Equity Portfolio; 3,887,887 shares (cost $114,649,620).................. 116,286,704
PPI Scudder International Growth Portfolio; 14,375,874 shares (cost $199,666,185)..... 202,699,815
PPI T. Rowe Price Growth Equity Portfolio; 3,885,589 shares (cost $166,078,985) ...... 169,450,553
---------------
NET ASSETS (cost $10,239,788,590) ..................................................... $11,155,254,351
===============
Net assets represented by:
Reserves for annuity contracts in accumulation and payment period: (Notes 1 and 5)
Aetna Variable Fund:
Annuity contracts in accumulation .................................................... $ 6,078,549,136
Annuity contracts in payment period .................................................. 292,045,818
Aetna Income Shares:
Annuity contracts in accumulation .................................................... 372,629,553
Annuity contracts in payment period .................................................. 6,218,756
</TABLE>
<PAGE>
Variable Annuity Account C
Statement of Assets and Liabilities - December 31, 1997 (continued):
<TABLE>
<S> <C>
Aetna Variable Encore Fund:
Annuity contracts in accumulation ...................... $ 240,346,197
Aetna Investment Advisers Fund, Inc.:
Annuity contracts in accumulation ...................... 968,354,403
Annuity contracts in payment period .................... 21,193,276
Aetna GET Fund, Series B:
Annuity contracts in accumulation ...................... 79,552,932
Aetna GET Fund, Series C:
Annuity contracts in accumulation ...................... 236,822,693
Aetna Ascent Variable Portfolio:
Annuity contracts in accumulation ...................... 72,115,304
Aetna Crossroads Variable Portfolio:
Annuity contracts in accumulation ...................... 49,739,310
Aetna Legacy Variable Portfolio:
Annuity contracts in accumulation ...................... 32,749,254
Annuity contracts in payment period .................... 53,658
Aetna Variable Portfolios, Inc.:
Aetna Variable Capital Appreciation Portfolio:
Annuity contracts in accumulation ...................... 2,039,640
Aetna Variable Growth Portfolio:
Annuity contracts in accumulation ...................... 1,098,483
Aetna Variable Index Plus Portfolio:
Annuity contracts in accumulation ...................... 83,098,319
Annuity contracts in payment period .................... 76,758
Aetna Variable Small Company Portfolio:
Annuity contracts in accumulation ...................... 4,956,212
Calvert Social Balanced Portfolio:
Annuity contracts in accumulation ...................... 54,444,411
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio:
Annuity contracts in accumulation ...................... 190,735,350
Growth Portfolio:
Annuity contracts in accumulation ...................... 128,257,345
Overseas Portfolio:
Annuity contracts in accumulation ...................... 13,449,206
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio:
Annuity contracts in accumulation ...................... 23,199,341
Contrafund Portfolio:
Annuity contracts in accumulation ...................... 256,548,805
Index 500 Portfolio:
Annuity contracts in accumulation ...................... 57,721,771
Janus Aspen Series:
Aggressive Growth Portfolio:
Annuity contracts in accumulation ...................... 210,600,444
Balanced Portfolio:
Annuity contracts in accumulation ...................... 37,451,981
Flexible Income Portfolio:
Annuity contracts in accumulation ...................... 14,756,039
Growth Portfolio:
Annuity contracts in accumulation ...................... 79,992,417
Annuity contracts in payment period .................... 35,986
</TABLE>
<PAGE>
Variable Annuity Account C
Statement of Assets and Liabilities - December 31, 1997 (continued):
<TABLE>
<S> <C>
Worldwide Growth Portfolio:
Annuity contracts in accumulation ........... $ 429,093,163
Annuity contracts in payment period ......... 116,838
Lexington Emerging Markets Fund:
Annuity contracts in accumulation ........... 5,788,593
Lexington Natural Resources Trust Fund:
Annuity contracts in accumulation ........... 42,965,725
Portfolio Partners, Inc.:
PPI MFS Emerging Equities Portfolio:
Annuity contracts in accumulation ........... 352,966,999
Annuity contracts in payment period ......... 23,166
PPI MFS Research Growth Portfolio:
Annuity contracts in accumulation ........... 227,029,997
PPI MFS Value Equity Portfolio:
Annuity contracts in accumulation ........... 116,286,704
PPI Scudder International Growth Portfolio:
Annuity contracts in accumulation ........... 202,699,815
PPI T. Rowe Price Growth Equity Portfolio:
Annuity contracts in accumulation ........... 169,450,553
---------------
$11,155,254,351
===============
</TABLE>
See Notes to Financial Statements
<PAGE>
Variable Annuity Account C
Statements of Operations and Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended December 31,
1997 1996
------------------- -----------------
<S> <C> <C>
INVESTMENT INCOME:
Income: (Notes 1, 3 and 5)
Dividends ............................................................ $ 1,552,106,208 $ 712,854,599
Expenses: (Notes 2 and 5)
Valuation period deductions .......................................... (120,867,375) (93,446,331)
--------------- --------------
Net investment income ................................................. 1,431,238,833 619,408,268
--------------- --------------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized gain on sales of investments: (Notes 1, 4 and 5)
Proceeds from sales .................................................. 2,013,561,413 2,060,808,031
Cost of investments sold ............................................. 1,773,010,971 1,547,239,509
--------------- --------------
Net realized gain ................................................... 240,550,442 513,568,522
Net unrealized gain on investments: (Note 5)
Beginning of year .................................................... 612,391,085 594,083,184
End of year .......................................................... 915,465,761 612,391,085
--------------- --------------
Net change in unrealized gain ....................................... 303,074,676 18,307,901
--------------- --------------
Net realized and unrealized gain on investments ....................... 543,625,118 531,876,423
--------------- --------------
Net increase in net assets resulting from operations .................. 1,974,863,951 1,151,284,691
--------------- --------------
FROM UNIT TRANSACTIONS:
Variable annuity contract purchase payments ........................... 1,039,130,530 951,293,520
Sales and administrative charges deducted by the Company .............. (17,373) (61,783)
--------------- --------------
Net variable annuity contract purchase payments ...................... 1,039,113,157 951,231,737
Transfer from the Company for mortality guarantee adjustments ......... 2,085,609 3,247,064
Transfers from the Company's fixed account options .................... 166,510,610 187,508,331
Transfers to the Company's other variable annuity accounts ............ (88,238,000) 0
Redemptions by contract holders ....................................... (474,257,152) (339,383,183)
Annuity Payments ...................................................... (31,253,253) (20,948,181)
Other ................................................................. 1,227,066 144,245
--------------- --------------
Net increase in net assets from unit transactions (Note 5) ........... 615,188,037 781,800,013
--------------- --------------
Change in net assets .................................................. 2,590,051,988 1,933,084,704
NET ASSETS:
Beginning of year ..................................................... 8,565,202,363 6,632,117,659
--------------- --------------
End of year ........................................................... $11,155,254,351 $8,565,202,363
=============== ==============
</TABLE>
See Notes to Financial Statements
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997
<TABLE>
<CAPTION>
- ---------------------------------------------------------------
Value
Per Unit
--------
Beginning End of
of Year Year
- ---------------------------------------------------------------
<S> <C> <C>
Aetna Variable Fund:
Qualified I $ 222.444 $ 285.511
Qualified III 169.448 217.359
Qualified V 17.318 22.179
Qualified VI 17.302 22.194
Qualified VII 16.291 20.910
Qualified VIII 16.068 20.609
Qualified IX 18.142 20.525
Qualified X (1.15) 17.357 22.287
Qualified X (1.25) 17.302 22.194
Qualified XI 17.352 22.325
Qualified XII (0.95) 11.469 14.756
Qualified XII (1.00) 11.465 14.744
Qualified XII (1.05) 12.312 14.732
Qualified XII (1.10) 14.520 14.720
Qualified XII (1.15) 11.805 14.708
Qualified XII (1.20) 13.746 14.696
Qualified XII (1.25) 12.851 14.684
Qualified XII (1.30) 12.519 14.672
Qualified XII (1.50) 11.429 14.624
Qualified XIII 17.333 22.301
Qualified XV 17.304 22.264
Qualified XVI 17.861 22.153
Qualified XVII 19.673 22.226
Qualified XVIII 19.673 22.226
Qualified XIX 253.000 285.918
Qualified XX 192.674 217.668
Qualified XXI 180.495 217.796
Annuity contracts in payment period
- ---------------------------------------------------------------
Aetna Income Shares:
Qualified I 48.524 51.930
Qualified III 47.992 51.330
Qualified V 12.546 13.397
Qualified VI 12.377 13.238
Qualified VII 11.440 12.243
Qualified VIII 11.398 12.190
Qualified IX 11.737 12.330
Qualified X (1.15) 12.416 13.293
Qualified X (1.25) 12.377 13.238
Qualified XI 12.413 13.316
Qualified XII (0.95) 10.503 11.268
Qualified XII (1.00) 10.500 11.258
Qualified XII (1.05) 10.587 11.249
Qualified XII (1.10) 11.219 11.240
Qualified XII (1.15) 10.476 11.231
Qualified XII (1.30) 10.974 11.203
Qualified XII (1.50) 10.442 11.166
Qualified XIII 12.399 13.301
Qualified XV 12.379 13.279
Qualified XVI 12.302 13.213
Qualified XVII 12.629 13.249
Qualified XVIII 12.629 13.249
Qualified XIX 49.527 51.975
Qualified XX 48.971 51.374
Qualified XXI 48.310 51.433
Annuity contracts in payment period
- ---------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
Increase (Decrease) Units
in Value of Outstanding Reserves
Accumulation at End at End
Unit of Year of Year
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aetna Variable Fund:
Qualified I 28.35% 158,077.9 $ 45,133,058
Qualified III 28.27% 1,826,355.4 396,974,407
Qualified V 28.07% 18,366.5 407,344
Qualified VI 28.28% 177,627,473.7 3,942,256,334
Qualified VII 28.35% 9,786,464.3 204,634,763
Qualified VIII 28.26% 40,423.8 833,106
Qualified IX 13.13% (5) 21,897.7 449,443
Qualified X (1.15) 28.40% 461,570.5 10,286,990
Qualified X (1.25) 28.28% 21,842,444.3 484,770,246
Qualified XI 28.66% 5,232,193.2 116,809,519
Qualified XII (0.95) 28.66% 3,760,075.7 55,484,162
Qualified XII (1.00) 28.60% 362,674.6 5,347,295
Qualified XII (1.05) 19.66% (2) 44,424.7 654,463
Qualified XII (1.10) 1.37% (10) 570.3 8,394
Qualified XII (1.15) 24.59% (1) 508,937.5 7,485,354
Qualified XII (1.20) 6.91% (6) 25.4 373
Qualified XII (1.25) 14.26% (4) 1,646.0 24,170
Qualified XII (1.30) 17.20% (4) 3,082.0 45,218
Qualified XII (1.50) 27.96% 40,309.2 589,466
Qualified XIII 28.66% 7,667,724.4 170,997,048
Qualified XV 28.66% 8,238,897.6 183,429,504
Qualified XVI 24.03% (3) 1,699,981.8 37,660,480
Qualified XVII 12.97% (5) 6,093,102.4 135,422,705
Qualified XVIII 12.97% (5) 7,364,496.5 163,680,170
Qualified XIX 13.01% (5) 118,511.2 33,884,499
Qualified XX 12.97% (5) 225,861.8 49,162,988
Qualified XXI 20.67% (4) 147,466.3 32,117,637
Annuity contracts in payment period 292,045,818
- -----------------------------------------------------------------------------------------------------------
Aetna Income Shares:
Qualified I 7.02% 20,287.9 1,053,558
Qualified III 6.96% 959,336.3 49,242,416
Qualified V 6.78% 10,766.1 144,233
Qualified VI 6.96% 18,047,780.2 238,908,177
Qualified VII 7.02% 174,636.6 2,138,095
Qualified VIII 6.95% 10,668.8 130,056
Qualified IX 5.06% (5) 1,747.9 21,552
Qualified X (1.15) 7.06% 98,338.3 1,307,212
Qualified X (1.25) 6.96% 2,482,651.8 32,864,198
Qualified XI 7.28% 328,773.7 4,377,906
Qualified XII (0.95) 7.28% 251,155.5 2,829,934
Qualified XII (1.00) 7.22% 64,958.1 731,326
Qualified XII (1.05) 6.25% (2) 11,619.2 130,706
Qualified XII (1.10) 0.19% (11) 6.4 72
Qualified XII (1.15) 7.20% (1) 89,517.2 1,005,343
Qualified XII (1.30) 2.09% (6) 278.8 3,123
Qualified XII (1.50) 6.94% (1) 2,940.1 32,830
Qualified XIII 7.28% 463,067.7 6,159,426
Qualified XV 7.28% 553,278.5 7,347,133
Qualified XVI 7.41% (3) 215,650.2 2,849,462
Qualified XVII 4.91% (5) 453,722.7 6,011,308
Qualified XVIII 4.91% (5) 765,835.4 10,146,445
Qualified XIX 4.94% (5) 23,539.1 1,223,438
Qualified XX 4.91% (5) 39,708.6 2,039,970
Qualified XXI 6.46% (4) 37,556.2 1,931,634
Annuity contracts in payment period 6,218,756
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Aetna Variable Encore Fund:
Qualified I $40.069 $41.763 4.23% 34,419.9 $ 1,437,489
Qualified III 39.528 41.174 4.16% 455,501.8 18,754,940
Qualified V 11.431 11.888 4.00% 13,511.0 160,621
Qualified VI 11.473 11.951 4.16% 12,191,085.4 145,695,479
Qualified VII 11.386 11.867 4.23% 333,823.0 3,961,576
Qualified VIII 11.050 11.509 4.16% 2,212.2 25,461
Qualified IX 11.536 11.827 2.52% (5) 2,646.1 31,295
Qualified X (1.15) 11.510 12.002 4.27% 137,698.5 1,652,599
Qualified X (1.25) 11.473 11.951 4.16% 2,227,782.0 26,624,190
Qualified XI 11.506 12.022 4.48% 262,519.4 3,155,928
Qualified XII (0.95) 10.277 10.738 4.48% 147,123.4 1,579,742
Qualified XII (1.00) 10.274 10.729 4.43% 65,496.0 702,689
Qualified XII (1.05) 10.322 10.720 3.86% (2) 1,863.1 19,972
Qualified XII (1.10) 10.663 10.711 0.45% (10) 145.4 1,558
Qualified XII (1.15) 10.264 10.702 4.27% 44,265.0 473,739
Qualified XII (1.30) 10.358 10.676 3.07% (3) 8,301.8 88,630
Qualified XII (1.50) 10.249 10.641 3.82% (1) 13,867.8 147,568
Qualified XIII 11.494 12.009 4.48% 328,673.9 3,946,913
Qualified XV 11.475 11.989 4.48% 477,489.5 5,724,459
Qualified XVI 11.592 11.929 2.91% (3) 176,702.8 2,107,915
Qualified XVII 11.674 11.951 2.37% (5) 591,901.2 7,073,802
Qualified XVIII 11.674 11.951 2.37% (5) 936,222.8 11,188,785
Qualified XIX 40.781 41.763 2.41% (5) 19,719.9 823,569
Qualified XX 40.220 41.174 2.37% (5) 98,559.6 4,058,116
Qualified XXI 40.046 41.257 3.03% (4) 22,036.4 909,162
- --------------------------------------------------------------------------------------------------------------------------------
Aetna Investment Advisers Fund, Inc.:
Qualified I 20.511 24.826 21.04% 84,064.8 2,087,001
Qualified III 20.419 24.700 20.96% 2,160,304.7 53,358,639
Qualified V 15.548 18.777 20.77% 5,382.7 101,071
Qualified VI 15.551 18.811 20.96% 34,194,804.1 643,225,567
Qualified VII 14.948 18.092 21.04% 317,711.6 5,748,028
Qualified VIII 14.437 17.463 20.95% 3,789.8 66,180
Qualified IX 15.497 17.464 12.69% (5) 2,862.4 49,989
Qualified X (1.15) 15.600 18.889 21.08% 166,914.5 3,152,897
Qualified X (1.25) 15.551 18.811 20.96% 6,663,594.3 125,346,360
Qualified XI 15.596 18.922 21.33% 776,268.3 14,688,460
Qualified XII (0.95) 10.902 13.226 21.32% 986,710.9 13,050,376
Qualified XII (1.00) 13.054 13.215 1.23% (6) 57,737.1 763,013
Qualified XII (1.05) 12.677 13.204 4.16% (6) 4,205.1 55,526
Qualified XII (1.10) 12.915 13.194 2.16% (10) 294.1 3,881
Qualified XII (1.15) 11.130 13.183 18.44% (1) 250,059.5 3,296,487
Qualified XII (1.25) 11.921 13.161 10.40% (5) 132.9 1,749
Qualified XII (1.30) 11.717 13.150 12.23% (5) 459.4 6,041
Qualified XII (1.50) 11.009 13.107 19.05% (1) 7,997.4 104,824
Qualified XIII 15.579 18.901 21.33% 1,511,040.6 28,560,625
Qualified XV 15.553 18.870 21.33% 1,144,876.1 21,603,682
Qualified XVI 15.674 18.776 19.79% (3) 478,176.8 8,978,386
Qualified XVII 16.739 18.837 12.53% (5) 454,231.6 8,744,928
Qualified XVIII 16.739 18.837 12.53% (5) 772,953.8 14,560,460
Qualified XIX 22.085 24.861 12.57% (5) 157,309.2 3,910,940
Qualified XX 21.980 24.735 12.53% (5) 178,942.7 4,426,106
Qualified XXI 20.723 24.749 19.43% (4) 503,577.0 12,463,187
Annuity contracts in payment period 21,193,276
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Aetna GET Fund, Series B:
Qualified III $15.634 $20.718 32.52% 58,653.2 $ 1,215,171
Qualified VI 15.634 20.718 32.52% 2,726,876.8 56,495,097
Qualified X (1.25) 15.634 20.718 32.52% 328,634.3 6,808,604
Qualified XI 15.679 20.840 32.92% 346,406.7 7,219,227
Qualified XII (1.20) 11.054 12.870 16.43% (5) 9,152.8 117,795
Qualified XII (1.40) 12.575 12.845 2.15% (6) 1,060.3 13,620
Qualified XIII 15.662 20.818 32.92% 111,939.4 2,330,319
Qualified XVI 16.070 20.680 28.69% (3) 1,050.3 21,721
Qualified XVII 18.062 20.718 14.70% (5) 33,837.1 701,033
Qualified XV 15.636 20.783 32.92% 222,793.6 4,630,345
- ------------------------------------------------------------------------------------------------------------------------------
Aetna GET Fund, Series C:
Qualified III 10.241 12.636 23.39% 867,906.1 10,967,080
Qualified VI 10.241 12.636 23.39% 15,532,360.4 196,270,804
Qualified XI 10.250 12.685 23.76% 1,034,173.6 13,118,682
Qualified XII (1.20) 10.250 12.685 23.76% 82,397.3 1,045,224
Qualified XII (1.25) 10.248 12.677 23.70% 31,761.7 402,644
Qualified XII (1.40) 10.503 12.653 20.46% (1) 4,912.1 62,150
Qualified XII (1.75) 12.001 12.596 4.95% (6) 496.0 6,247
Qualified XIII 10.250 12.685 23.76% 607,502.0 7,706,275
Qualified XV 10.242 12.676 23.76% 388,232.0 4,921,246
Qualified XVI 10.413 12.613 21.13% (3) 40,922.5 516,163
Qualified XVII 11.359 12.636 11.24% (5) 142,936.2 1,806,178
- ------------------------------------------------------------------------------------------------------------------------------
Aetna Ascent Variable Portfolio:
Qualified I 11.678 13.836 18.48% 347.4 4,806
Qualified III 13.291 15.422 16.04% (2) 379.8 5,858
Qualified V 12.996 15.363 18.22% 1,607.9 24,702
Qualified VI 13.025 15.422 18.40% 3,543,367.2 54,647,052
Qualified VIII 13.024 15.419 18.40% 90.9 1,402
Qualified X (1.15) 13.415 15.900 18.52% 20,153.5 320,445
Qualified X (1.25) 13.395 15.860 18.40% 554,873.0 8,800,510
Qualified XI 13.063 15.514 18.76% 65,940.1 1,022,966
Qualified XII (0.95) 11.472 13.624 18.76% 119,470.9 1,627,660
Qualified XII (1.00) 11.468 13.613 18.70% 14,462.5 196,874
Qualified XII (1.05) 11.629 13.602 16.96% (2) 24,508.4 333,353
Qualified XII (1.10) 13.275 13.590 2.37% (10) 42.3 575
Qualified XII (1.15) 11.525 13.579 17.82% (1) 6,391.5 86,792
Qualified XII (1.25) 12.564 13.557 7.91% (5) 253.3 3,433
Qualified XII (1.30) 11.759 13.546 15.20% (4) 854.8 11,579
Qualified XII (1.50) 11.422 13.502 18.20% (1) 9,984.6 134,807
Qualified XIII 13.049 15.497 18.76% 178,233.3 2,762,023
Qualified XV 13.027 15.471 18.76% 86,254.6 1,334,440
Qualified XVI 13.020 15.394 18.24% (3) 29,839.7 459,359
Qualified XVII 13.971 15.453 10.61% (5) 10,257.3 158,507
Qualified XVIII 14.368 15.892 10.61% (5) 11,210.7 178,161
- ------------------------------------------------------------------------------------------------------------------------------
Aetna Crossroads Variable Portfolio:
Qualified III 12.577 14.456 14.94% (2) 873.3 12,625
Qualified V 12.422 14.400 15.93% 491.5 7,078
Qualified VI 12.450 14.456 16.11% 2,469,082.2 35,692,895
Qualified VIII 12.449 14.453 16.10% 1,462.9 21,144
Qualified X (1.15) 12.763 14.835 16.23% 20,403.7 302,680
Qualified X (1.25) 12.744 14.797 16.11% 424,250.2 6,277,833
Qualified XI 12.486 14.541 16.46% 71,275.7 1,036,450
Qualified XII (0.95) 11.146 12.980 16.46% 117,725.3 1,528,123
Qualified XII (1.00) 12.945 12.970 0.19% (8) 2,785.5 36,127
Qualified XII (1.05) 11.292 12.959 14.76% (2) 12,846.9 166,485
Qualified XII (1.10) 12.904 12.949 0.34% (10) 14.0 181
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------
Value
Per Unit
--------
Beginning End of
of Year Year
- ------------------------------------------------------------------------
<S> <C> <C>
Aetna Crossroads Variable Portfolio (continued):
Qualified XII (1.15) $11.182 $12.938
Qualified XII (1.25) 12.024 12.917
Qualified XII (1.30) 11.380 12.906
Qualified XII (1.50) 11.093 12.864
Qualified XIII 12.473 14.526
Qualified XV 12.452 14.501
Qualified XVI 12.449 14.430
Qualified XVII 13.199 14.485
Qualified XVIII 13.511 14.827
- ------------------------------------------------------------------------
Aetna Legacy Variable Portfolio:
Qualified III 12.296 13.491
Qualified V 11.903 13.439
Qualified VI 11.930 13.491
Qualified X (1.15) 12.000 13.583
Qualified X (1.25) 11.982 13.550
Qualified XI 11.965 13.571
Qualified XII (0.95) 10.905 12.369
Qualified XII (1.00) 12.242 12.358
Qualified XII (1.05) 11.009 12.348
Qualified XII (1.10) 12.223 12.338
Qualified XII (1.15) 10.927 12.328
Qualified XII (1.25) 12.362 12.308
Qualified XII (1.30) 11.401 12.298
Qualified XII (1.50) 10.835 12.257
Qualified XIII 11.953 13.557
Qualified XV 11.932 13.534
Qualified XVI 11.873 13.467
Qualified XVII 12.496 13.518
Qualified XVIII 12.551 13.577
Annuity contracts in payment period
- ------------------------------------------------------------------------
Aetna Variable Portfolios, Inc.:
Aetna Variable Capital Apreciation Portfolio:
Qualified VI 12.913 13.261
Qualified X (1.15) 12.904 13.271
Qualified X (1.25) 10.977 13.261
Qualified XI 13.037 13.290
Qualified XII (0.95) 12.912 13.290
Qualified XII (1.05) 12.796 13.281
Qualified XII (1.10) 12.952 13.276
Qualified XII (1.15) 13.244 13.271
Qualified XII (1.50) 12.103 13.237
Qualified XIII 13.093 13.290
Qualified XV 13.093 13.290
Qualified XVI 13.237 13.237
- ------------------------------------------------------------------------
Aetna Variable Growth Portfolio:
Qualified VI 11.635 13.173
Qualified X (1.15) 14.472 13.183
Qualified X (1.25) 11.137 13.173
Qualified XI 12.787 13.202
Qualified XII (0.95) 12.787 13.202
Qualified XII (1.05) 13.184 13.192
Qualified XII (1.10) 13.325 13.188
Qualified XII (1.15) 13.348 13.183
Qualified XIII 12.975 13.202
Qualified XV 12.912 13.202
Qualified XVI 12.739 13.149
Qualified XVII 12.615 13.173
- ------------------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Increase (Decrease) Units
in Value of Outstanding Reserves
Accumulation at End at End
Unit of Year of Year
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aetna Crossroads Variable Portfolio (continued):
Qualified XII (1.15) 15.70% (1) 7,129.3 $ 92,239
Qualified XII (1.25) 7.42% (5) 92.9 1,200
Qualified XII (1.30) 13.41% (4) 641.2 8,275
Qualified XII (1.50) 15.96% (1) 30,806.0 396,282
Qualified XIII 16.46% 99,659.7 1,447,618
Qualified XV 16.46% 101,836.0 1,476,773
Qualified XVI 15.91% (3) 26,483.1 382,139
Qualified XVII 9.74% (5) 50,296.8 728,539
Qualified XVIII 9.74% (5) 8,405.2 124,624
- -----------------------------------------------------------------------------------------------------------------
Aetna Legacy Variable Portfolio:
Qualified III 9.72% (4) 2,279.1 30,748
Qualified V 12.90% 421.5 5,665
Qualified VI 13.08% 1,624,842.2 21,921,063
Qualified X (1.15) 13.20% 77,495.1 1,052,651
Qualified X (1.25) 13.08% 382,216.9 5,179,026
Qualified XI 13.42% 38,898.5 527,891
Qualified XII (0.95) 13.43% 47,725.7 590,296
Qualified XII (1.00) 0.95% (2) 64.2 793
Qualified XII (1.05) 12.16% (2) 6,221.3 76,822
Qualified XII (1.10) 0.94% (1) 850.8 10,497
Qualified XII (1.15) 12.82% (1) 21,027.4 259,226
Qualified XII (1.25) (0.44%) (9) 2.3 28
Qualified XII (1.30) 7.86% (5) 74.1 911
Qualified XII (1.50) 13.13% (3) 14,983.3 183,656
Qualified XIII 13.42% 58,121.1 787,948
Qualified XV 13.42% 82,178.1 1,112,175
Qualified XVI 13.42% (3) 14,817.2 199,537
Qualified XVII 8.18% (5) 16,059.5 217,094
Qualified XVIII 8.18% (5) 43,693.5 593,227
Annuity contracts in payment period 53,658
- -----------------------------------------------------------------------------------------------------------------
Aetna Variable Portfolios, Inc.:
Aetna Variable Capital Apreciation Portfolio:
Qualified VI 2.69% (7) 100,927.6 1,338,432
Qualified X (1.15) 2.84% (7) 1,510.0 20,039
Qualified X (1.25) 20.81% (4) 33,295.0 441,535
Qualified XI 1.94% (7) 3,417.0 45,413
Qualified XII (0.95) 2.93% (11) 587.0 7,802
Qualified XII (1.05) 3.79% (7) 16.5 219
Qualified XII (1.10) 2.50% (10) 46.3 615
Qualified XII (1.15) 0.20% (8) 46.7 619
Qualified XII (1.50) 9.37% (6) 795.2 10,526
Qualified XIII 1.50% (11) 8,131.1 108,065
Qualified XV 1.50% (11) 4,910.2 65,258
Qualified XVI 0.00% (11) 84.4 1,117
- -----------------------------------------------------------------------------------------------------------------
Aetna Variable Growth Portfolio:
Qualified VI 13.22% (5) 41,927.5 552,320
Qualified X (1.15) (8.91%) (9) 2,121.9 27,973
Qualified X (1.25) 18.28% (4) 21,371.1 281,526
Qualified XI 3.25% (11) 6,618.6 87,380
Qualified XII (0.95) 3.25% (7) 1,879.9 24,819
Qualified XII (1.05) 0.06% (7) 30.7 405
Qualified XII (1.10) (1.03%) (10) 36.9 487
Qualified XII (1.15) (1.24%) (8) 118.3 1,559
Qualified XIII 1.75% (11) 4,360.4 57,567
Qualified XV 2.25% (11) 6.8 89
Qualified XVI 3.22% (11) 3,326.3 43,738
Qualified XVII 4.42% (11) 1,565.3 20,620
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- ----------------------------------------------------------------
Value
Per Unit
--------
Beginning End of
of Year Year
- ----------------------------------------------------------------
<S> <C> <C>
Aetna Variable Index Plus Portfolio:
Qualified V $10.919 $14.414
Qualified VI 10.924 14.444
Qualified VIII 11.099 14.443
Qualified X (1.15) 11.406 14.463
Qualified X (1.25) 10.924 14.444
Qualified XI 10.934 14.500
Qualified XII (0.95) 10.934 14.500
Qualified XII (1.00) 14.289 14.491
Qualified XII (1.05) 14.043 14.481
Qualified XII (1.10) 14.078 14.472
Qualified XII (1.15) 11.663 14.463
Qualified XII (1.20) 13.642 14.453
Qualified XII (1.25) 14.070 14.444
Qualified XII (1.30) 11.470 14.435
Qualified XII (1.50) 11.374 14.397
Qualified XIII 10.934 14.500
Qualified XIV 14.493 14.444
Qualified XV 10.925 14.489
Qualified XVI 11.345 14.418
Qualified XVII 12.748 14.452
Annuity contracts in payment period
- ----------------------------------------------------------------
Aetna Variable Small Company Portfolio:
Qualified VI 12.299 13.654
Qualified X (1.15) 11.541 13.664
Qualified X (1.25) 10.816 13.654
Qualified XI 13.119 13.684
Qualified XII (0.95) 13.119 13.684
Qualified XII (1.05) 12.485 13.674
Qualified XII (1.10) 13.331 13.669
Qualified XII (1.15) 13.709 13.664
Qualified XII (1.50) 13.952 13.629
Qualified XIII 13.248 13.684
Qualified XV 13.248 13.684
Qualified XVI 13.629 13.629
Qualified XVII 13.092 13.654
- ----------------------------------------------------------------
Calvert Social Balanced Portfolio:
Qualified III 19.965 23.675
Qualified V 15.400 18.234
Qualified VI 15.044 17.840
Qualified VIII 13.668 16.207
Qualified XI 15.088 17.946
Qualified XII (0.95) 10.924 12.994
Qualified XII (1.00) 12.982 12.983
Qualified XII (1.05) 12.278 12.972
Qualified XII (1.15) 11.071 12.951
Qualified XII (1.25) 12.790 12.930
Qualified XII (1.30) 11.742 12.919
Qualified XII (1.50) 10.955 12.877
Qualified XIII 15.071 17.926
Qualified XV 15.046 17.896
Qualified XVI 14.934 17.808
Qualified XVII 16.178 17.840
- ----------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Increase (Decrease) Units
in Value of Outstanding Reserves
Accumulation at End at End
Unit of Year of Year
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aetna Variable Index Plus Portfolio:
Qualified V 32.01% 908.3 $ 13,092
Qualified VI 32.23% 4,796,643.6 69,282,701
Qualified VIII 30.12% (3) 107.6 1,553
Qualified X (1.15) 26.80% (1) 10,120.7 146,372
Qualified X (1.25) 32.23% 159,460.5 2,303,246
Qualified XI 32.62% 159,317.9 2,310,148
Qualified XII (0.95) 32.62% 62,360.0 904,235
Qualified XII (1.00) 1.41% (10) 28.5 414
Qualified XII (1.05) 3.12% (6) 1,083.2 15,686
Qualified XII (1.10) 2.80% (10) 215.4 3,117
Qualified XII (1.15) 24.01% (1) 5,516.5 79,784
Qualified XII (1.20) 5.95% (6) 24.0 346
Qualified XII (1.25) 2.66% (8) 9.5 137
Qualified XII (1.30) 25.85% (3) 8,664.6 125,071
Qualified XII (1.50) 26.58% (1) 3,155.7 45,434
Qualified XIII 32.62% 190,347.5 2,760,085
Qualified XIV (0.34%) (11) 17,770.7 256,680
Qualified XV 32.62% 293,222.5 4,248,634
Qualified XVI 27.09% (3) 27,945.1 402,902
Qualified XVII 13.37% (5) 13,747.5 198,682
Annuity contracts in payment period 76,758
- ---------------------------------------------------------------------------------------------------------
Aetna Variable Small Company Portfolio:
Qualified VI 11.02% (6) 253,548.2 3,462,032
Qualified X (1.15) 18.40% (5) 13,842.7 189,151
Qualified X (1.25) 26.24% (4) 71,910.5 981,889
Qualified XI 4.31% (11) 1,097.9 15,024
Qualified XII (0.95) 4.31% (11) 2,123.7 29,061
Qualified XII (1.05) 9.52% (6) 125.0 1,709
Qualified XII (1.10) 2.54% (10) 650.4 8,890
Qualified XII (1.15) (0.33%) (8) 119.1 1,627
Qualified XII (1.50) (2.31%) (8) 46.5 634
Qualified XIII 3.29% (11) 12,602.6 172,458
Qualified XV 3.29% (11) 4,992.9 68,325
Qualified XVI 0.00% (11) 81.9 1,117
Qualified XVII 4.29% (11) 1,779.3 24,295
- ---------------------------------------------------------------------------------------------------------
Calvert Social Balanced Portfolio:
Qualified III 18.59% 929,281.7 22,000,966
Qualified V 18.40% 3,857.9 70,344
Qualified VI 18.59% 1,499,988.7 26,759,958
Qualified VIII 18.58% 5,209.5 84,430
Qualified XI 18.94% 66,427.5 1,192,083
Qualified XII (0.95) 18.95% 93,905.0 1,220,160
Qualified XII (1.00) 0.01% (9) 25,620.1 332,625
Qualified XII (1.05) 5.65% (6) 766.1 9,938
Qualified XII (1.15) 16.98% (1) 37,415.9 484,572
Qualified XII (1.25) 1.09% (10) 5.6 72
Qualified XII (1.30) 10.02% (5) 43.8 566
Qualified XII (1.50) 17.54% (1) 1,007.0 12,967
Qualified XIII 18.94% 40,783.0 731,079
Qualified XV 18.94% 62,327.5 1,115,433
Qualified XVI 19.24% (3) 20,521.0 365,429
Qualified XVII 10.27% (5) 3,575.6 63,789
- ---------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fidelity Investments Variable
Insurance Products Fund:
Equity-Income Portfolio:
Qualified III $13.110 $16.587 26.52% 2,139,177.6 $ 35,481,646
Qualified V 12.447 15.723 26.32% 4,197.8 66,002
Qualified VI 12.518 15.837 26.52% 7,111,490.4 112,626,559
Qualified VIII 12.474 15.781 26.51% 2,316.4 36,554
Qualified X (1.15) 15.705 19.890 26.64% 162,627.2 3,234,589
Qualified X (1.25) 15.664 19.818 26.52% 1,311,210.7 25,985,915
Qualified XI 12.554 15.931 26.90% 196,920.7 3,137,126
Qualified XII (0.95) 10.819 13.729 26.90% 125,668.9 1,725,295
Qualified XII (1.00) 13.438 13.718 2.08% (9) 29,808.4 408,902
Qualified XII (1.05) 11.435 13.706 19.86% (2) 34,009.6 466,149
Qualified XII (1.10) 13.343 13.695 2.64% (10) 588.5 8,059
Qualified XII (1.15) 10.805 13.684 26.64% 40,977.4 560,732
Qualified XII (1.25) 13.299 13.661 2.73% (10) 5.7 78
Qualified XII (1.30) 10.942 13.650 24.75% (3) 7,816.6 106,699
Qualified XII (1.50) 10.905 13.606 24.77% (1) 9,207.0 125,267
Qualified XIII 12.541 15.914 26.90% 121,280.5 1,930,007
Qualified XV 12.520 15.887 26.90% 114,725.2 1,822,656
Qualified XVI 12.711 15.808 24.37% (3) 117,588.2 1,858,877
Qualified XVII 14.065 15.837 12.60% (5) 49,883.8 790,023
Qualified XVIII 17.600 19.818 12.60% (5) 18,377.8 364,215
- ------------------------------------------------------------------------------------------------------------------------------
Growth Portfolio:
Qualified I 10.770 13.142 22.02% 448.8 5,899
Qualified III 11.843 14.087 18.95% (1) 29.0 408
Qualified V 11.516 14.021 21.75% 2,634.3 36,936
Qualified VI 11.402 13.904 21.95% 6,586,697.8 91,584,543
Qualified VIII 11.541 14.073 21.94% 2,933.8 41,287
Qualified X (1.15) 15.900 19.409 22.07% 83,442.2 1,619,514
Qualified X (1.25) 15.858 19.339 21.95% 1,110,078.7 21,467,567
Qualified XI 11.435 13.987 22.31% 181,487.1 2,538,408
Qualified XII (0.95) 10.362 12.674 22.31% 150,611.8 1,908,832
Qualified XII (1.00) 10.358 12.663 22.25% 61,042.9 773,016
Qualified XII (1.05) 10.988 12.653 15.16% (2) 22,425.0 283,745
Qualified XII (1.10) 12.740 12.643 (0.77%) (10) 415.7 5,256
Qualified XII (1.15) 10.348 12.632 22.07% 43,952.9 555,227
Qualified XII (1.25) 11.704 12.612 7.76% (5) 214.3 2,703
Qualified XII (1.30) 10.724 12.601 17.51% (4) 2,030.9 25,592
Qualified XII (1.50) 10.537 12.560 19.20% (1) 2,792.8 35,077
Qualified XIII 11.423 13.972 22.31% 176,877.0 2,471,239
Qualified XV 11.404 13.948 22.31% 191,150.6 2,666,223
Qualified XVI 11.373 13.879 22.03% (3) 104,982.3 1,457,059
Qualified XVII 12.498 13.904 11.26% (5) 31,476.9 437,670
Qualified XVIII 17.382 19.339 11.26% (5) 17,640.4 341,144
- ------------------------------------------------------------------------------------------------------------------------------
Overseas Portfolio:
Qualified V 11.111 12.222 9.99% 444.7 5,435
Qualified VI 11.137 12.269 10.17% 718,565.0 8,816,124
Qualified VIII 11.370 12.267 7.89% (2) 108.7 1,334
Qualified X (1.15) 11.503 12.686 10.28% 23,720.7 300,912
Qualified X (1.25) 11.473 12.640 10.17% 221,450.4 2,799,098
Qualified XI 11.169 12.342 10.50% 22,046.7 272,093
Qualified XII (0.95) 10.664 11.783 10.50% 20,272.6 238,881
Qualified XII (1.00) 11.818 11.774 (0.37%) (10) 1,294.3 15,239
Qualified XII (1.05) 10.798 11.764 8.95% (2) 3,858.4 45,390
Qualified XII (1.10) 11.651 11.754 0.89% (11) 5.0 59
Qualified XII (1.15) 10.662 11.745 10.15% (1) 6,203.4 72,856
Qualified XII (1.25) 12.512 11.726 (6.28%) (8) 22.0 258
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Overseas Portfolio (continued):
Qualified XII (1.30) $11.785 $11.716 (0.58%) (4) 348.0 $ 4,077
Qualified XII (1.50) 10.566 11.678 10.52% (1) 107.0 1,250
Qualified XIII 11.157 12.328 10.50% 40,515.7 499,486
Qualified XV 11.138 12.308 10.50% 19,948.5 245,521
Qualified XVI 11.253 12.247 8.83% (3) 8,098.0 99,173
Qualified XVII 12.518 12.269 (1.99%) (5) 1,206.3 14,800
Qualified XVIII 12.896 12.640 (1.99%) (5) 1,362.3 17,220
- --------------------------------------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance
Products Fund II:
Asset Manager Portfolio:
Qualified III 12.349 14.715 19.16% 1,576,602.6 23,199,341
- --------------------------------------------------------------------------------------------------------------------------
Contrafund Portfolio:
Qualified III 14.092 17.276 22.59% 2,706,862.3 46,764,938
Qualified V 12.511 15.315 22.40% 5,306.1 81,260
Qualified VI 12.455 15.270 22.60% 11,399,666.0 174,069,650
Qualified VIII 12.538 15.371 22.59% 2,547.5 39,158
Qualified X (1.15) 14.016 17.201 22.72% 16,983.4 292,137
Qualified X (1.25) 13.994 17.156 22.60% 811,557.1 13,923,305
Qualified XI 12.491 15.360 22.97% 171,832.1 2,639,339
Qualified XII (0.95) 11.243 13.825 22.97% 266,396.4 3,682,924
Qualified XII (1.00) 11.239 13.814 22.91% 139,417.2 1,925,863
Qualified XII (1.05) 12.865 13.802 7.28% (6) 9,649.8 133,189
Qualified XII (1.10) 13.502 13.791 2.14% (10) 110.0 1,517
Qualified XII (1.15) 11.228 13.780 22.72% 56,042.0 772,242
Qualified XII (1.20) 12.889 13.768 6.82% (6) 27.1 373
Qualified XII (1.25) 11.902 13.757 15.59% (4) 390.4 5,371
Qualified XII (1.30) 11.031 13.746 24.61% (3) 7,727.9 106,227
Qualified XII (1.50) 11.436 13.701 19.81% (1) 8,703.5 119,245
Qualified XIII 12.477 15.343 22.97% 320,225.7 4,913,319
Qualified XV 12.457 15.318 22.97% 263,158.5 4,031,017
Qualified XVI 12.388 15.242 23.04% (3) 146,380.6 2,231,110
Qualified XVII 13.443 15.270 13.59% (5) 29,364.8 448,392
Qualified XVIII 15.104 17.156 13.59% (5) 21,463.2 368,229
- --------------------------------------------------------------------------------------------------------------------------
Index 500 Portfolio:
Qualified III 14.240 18.662 31.05% 3,093,080.3 57,721,771
- --------------------------------------------------------------------------------------------------------------------------
Janus Aspen Series:
Aggressive Growth Portfolio:
Qualified III 16.334 18.174 11.26% 1,939,607.0 35,251,208
Qualified V 14.151 15.720 11.09% 3,915.3 61,549
Qualified VI 14.202 15.801 11.26% 9,271,525.1 146,503,800
Qualified VIII 14.199 15.798 11.26% 4,916.8 77,674
Qualified X (1.15) 13.733 15.295 11.38% 13,372.5 204,530
Qualified X (1.25) 13.710 15.254 11.27% 493,462.1 7,527,331
Qualified XI 14.243 15.895 11.60% 253,315.5 4,026,449
Qualified XII (0.95) 9.510 10.613 11.60% 416,099.6 4,416,132
Qualified XII (1.00) 9.507 10.604 11.54% 106,350.0 1,127,785
Qualified XII (1.05) 8.894 10.596 19.14% (2) 38,784.8 410,954
Qualified XII (1.10) 10.337 10.587 2.42% (10) 268.5 2,843
Qualified XII (1.15) 9.498 10.578 11.38% 77,340.2 818,132
Qualified XII (1.25) 9.646 10.561 9.48% (5) 262.2 2,769
Qualified XII (1.30) 8.944 10.552 17.98% (4) 2,526.5 26,660
Qualified XII (1.50) 9.477 10.518 10.99% 12,647.8 133,025
Qualified XIII 14.227 15.878 11.60% 211,782.7 3,362,627
Qualified XV 14.204 15.851 11.60% 294,622.8 4,670,152
Qualified XVI 12.594 15.773 25.24% (3) 85,304.1 1,345,470
Qualified XVII 14.156 15.801 11.62% (5) 26,177.0 413,636
Qualified XVIII 13.666 15.254 11.62% (5) 14,272.7 217,718
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balanced Portfolio:
Qualified III $12.453 $15.016 20.58% 7,873.2 $ 118,223
Qualified V 12.421 14.954 20.39% 165.9 2,480
Qualified VI 12.449 15.012 20.58% 1,911,788.7 28,699,149
Qualified VIII 12.448 15.009 20.58% 1,216.5 18,258
Qualified X (1.15) 12.938 15.616 20.70% 24,214.0 378,137
Qualified X (1.25) 12.917 15.576 20.58% 241,028.4 3,754,372
Qualified XI 12.485 15.100 20.95% 45,502.8 687,112
Qualified XII (0.95) 11.105 13.431 20.95% 42,699.3 573,480
Qualified XII (1.00) 13.490 13.420 (0.52%) (9) 5,845.8 78,489
Qualified XII (1.05) 11.587 13.409 15.73% (2) 14,526.6 194,782
Qualified XII (1.10) 13.138 13.398 1.98% (10) 256.2 3,433
Qualified XII (1.15) 11.090 13.387 20.71% 15,460.7 206,968
Qualified XII (1.30) 12.113 13.354 10.24% (5) 369.4 4,932
Qualified XII (1.50) 11.136 13.310 19.52% (1) 2,801.1 37,283
Qualified XIII 12.472 15.084 20.95% 58,998.8 889,938
Qualified XV 12.451 15.059 20.95% 78,052.1 1,175,384
Qualified XVI 12.760 14.984 17.43% (3) 19,967.4 299,196
Qualified XVII 13.573 15.012 10.60% (5) 8,662.8 130,043
Qualified XVIII 14.084 15.576 10.60% (5) 12,860.5 200,322
- -----------------------------------------------------------------------------------------------------------------------------
Flexible Income Portfolio:
Qualified III 13.074 14.430 10.37% 5,211.3 75,197
Qualified V 12.976 14.299 10.20% 241.4 3,452
Qualified VI 13.022 14.373 10.37% 934,053.2 13,425,300
Qualified VIII 13.020 14.370 10.36% 200.7 2,884
Qualified XI 13.060 14.458 10.70% 13,925.3 201,335
Qualified XII (0.95) 10.902 12.069 10.70% 29,665.3 358,027
Qualified XII (1.00) 10.857 12.059 11.07% (1) 12,526.9 151,061
Qualified XII (1.05) 11.571 12.049 4.13% (6) 700.0 8,434
Qualified XII (1.10) 11.872 12.039 1.41% (10) 12.2 147
Qualified XII (1.15) 10.882 12.029 10.54% (1) 4,139.8 49,800
Qualified XII (1.50) 10.955 11.960 9.18% (3) 117.6 1,406
Qualified XIII 13.046 14.442 10.70% 11,145.1 160,962
Qualified XV 13.024 14.418 10.70% 13,586.8 195,900
Qualified XVI 13.025 14.347 10.15% (3) 8,189.2 117,489
Qualified XVII 13.448 14.373 6.88% (5) 323.2 4,546
- -----------------------------------------------------------------------------------------------------------------------------
Growth Portfolio:
Qualified III 13.872 16.816 21.22% 1,109,942.2 18,664,665
Qualified V 12.698 15.368 21.03% 1,586.1 24,375
Qualified VI 12.716 15.414 21.22% 3,100,436.3 47,790,860
Qualified VIII 12.725 15.424 21.21% 1,431.9 22,086
Qualified X (1.15) 13.621 16.528 21.34% 7,407.3 122,428
Qualified X (1.25) 13.599 16.485 21.22% 376,501.1 6,206,793
Qualified XI 12.753 15.505 21.59% 83,855.4 1,300,210
Qualified XII (0.95) 10.891 13.242 21.59% 92,666.4 1,227,056
Qualified XII (1.00) 10.929 13.231 21.07% (1) 17,097.5 226,214
Qualified XII (1.05) 13.078 13.220 1.08% (6) 7,726.4 102,143
Qualified XII (1.10) 12.995 13.209 1.65% (10) 497.7 6,574
Qualified XII (1.15) 11.138 13.198 18.49% (1) 22,178.5 292,718
Qualified XII (1.25) 13.270 13.177 (0.70%) (8) 32.1 423
Qualified XII (1.30) 10.962 13.166 20.11% (3) 637.0 8,386
Qualified XII (1.50) 11.002 13.123 19.27% (1) 5,724.1 75,116
Qualified XIII 12.739 15.489 21.59% 86,733.2 1,343,371
Qualified XV 12.718 15.463 21.59% 93,385.9 1,444,008
Qualified XVI 12.975 15.386 18.58% (3) 53,181.5 818,255
Qualified XVII 13.985 15.414 10.22% (5) 6,389.4 98,487
Qualified XVIII 14.957 16.485 10.22% (5) 13,238.9 218,249
Annuity contracts in payment period 35,986
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- ---------------------------------------------------------------
Value
Per Unit
--------
Beginning End of
of Year Year
- ---------------------------------------------------------------
<S> <C> <C>
Worldwide Growth Portfolio:
Qualified III $15.493 $18.690
Qualified V 13.934 16.782
Qualified VI 13.860 16.720
Qualified VIII 13.819 16.670
Qualified X (1.15) 15.592 18.828
Qualified X (1.25) 15.566 18.779
Qualified XI 13.900 16.819
Qualified XII (0.95) 11.370 13.757
Qualified XII (1.00) 11.366 13.746
Qualified XII (1.05) 12.089 13.735
Qualified XII (1.10) 13.565 13.724
Qualified XII (1.15) 11.355 13.712
Qualified XII (1.20) 13.856 13.701
Qualified XII (1.25) 13.125 13.690
Qualified XII (1.30) 11.961 13.679
Qualified XII (1.50) 11.483 13.634
Qualified XIII 13.885 16.800
Qualified XV 13.862 16.773
Qualified XVI 14.439 16.689
Qualified XVII 15.828 16.720
Qualified XVIII 17.777 18.779
Annuity contracts in payment period
- ---------------------------------------------------------------
Lexington Emerging Markets Fund:
Qualified III 8.832 7.715
- ---------------------------------------------------------------
Lexington Natural Resources Trust Fund:
Qualified III 13.611 14.403
Qualified V 15.132 15.987
Qualified VI 14.686 15.541
Qualified VIII 11.847 13.472
Qualified XI 14.729 15.633
Qualified XII (0.95) 11.383 12.082
Qualified XII (1.00) 13.838 12.072
Qualified XII (1.05) 12.407 12.062
Qualified XII (1.15) 11.865 12.042
Qualified XII (1.25) 11.717 12.022
Qualified XII (1.30) 10.678 12.012
Qualified XII (1.50) 11.712 11.973
Qualified XIII 14.713 15.616
Qualified XV 14.688 15.590
Qualified XVI 13.756 15.512
Qualified XVII 15.221 15.541
- ---------------------------------------------------------------
Portfolio Partners, Inc.:
PPI MFS Emerging Equities Portfolio:
Qualified III 15.236 15.046
Qualified V 15.082 14.893
Qualified VI 15.114 14.927
Qualified VIII 15.834 15.638
Qualified X (1.15) 15.178 14.991
Qualified X (1.25) 15.114 14.927
Qualified XI 15.199 15.015
Qualified XII (0.95) 10.062 9.940
Qualified XII (1.00) 10.054 9.932
Qualified XII (1.05) 10.046 9.923
Qualified XII (1.10) 10.039 9.915
Qualified XII (1.15) 10.031 9.907
Qualified XII (1.25) 10.015 9.891
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Increase (Decrease) Units
in Value of Outstanding Reserves
Accumulation at End at End
Unit of Year of Year
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Worldwide Growth Portfolio:
Qualified III 20.64% 3,873,510.8 $ 72,396,192
Qualified V 20.44% 6,494.4 108,991
Qualified VI 20.64% 17,194,687.4 287,493,006
Qualified VIII 20.63% 3,606.0 60,112
Qualified X (1.15) 20.76% 59,450.3 1,119,319
Qualified X (1.25) 20.64% 1,206,175.4 22,650,509
Qualified XI 21.00% 511,940.2 8,610,186
Qualified XII (0.95) 21.00% 555,448.3 7,641,464
Qualified XII (1.00) 20.94% 207,630.2 2,854,094
Qualified XII (1.05) 13.61% (2) 59,673.2 819,597
Qualified XII (1.10) 1.17% (10) 971.1 13,327
Qualified XII (1.15) 20.76% 77,286.3 1,059,767
Qualified XII (1.20) (1.12%) (6) 27.2 372
Qualified XII (1.25) 4.30% (5) 273.4 3,743
Qualified XII (1.30) 14.36% (3) 2,017.9 27,601
Qualified XII (1.50) 18.73% (1) 16,827.5 229,421
Qualified XIII 21.00% 586,164.3 9,847,823
Qualified XV 21.00% 538,280.6 9,028,338
Qualified XVI 15.59% (3) 168,191.2 2,807,002
Qualified XVII 5.64% (5) 63,534.2 1,062,283
Qualified XVIII 5.64% (5) 67,097.8 1,260,016
Annuity contracts in payment period 116,838
- ---------------------------------------------------------------------------------------------------------
Lexington Emerging Markets Fund:
Qualified III 12.65% 750,329.90 5,788,593
- ---------------------------------------------------------------------------------------------------------
Lexington Natural Resources Trust Fund:
Qualified III 5.82% 650,485.7 9,369,171
Qualified V 5.65% 2,417.3 38,644
Qualified VI 5.82% 1,786,408.7 27,762,116
Qualified VIII 13.71% (3) 795.3 10,714
Qualified XI 6.14% 73,257.7 1,145,213
Qualified XII (0.95) 6.14% 85,577.1 1,033,914
Qualified XII (1.00) (12.77%) (9) 12,962.5 156,481
Qualified XII (1.05) (2.78%) (6) 790.8 9,538
Qualified XII (1.15) 1.50% (1) 12,454.4 149,977
Qualified XII (1.25) 2.60% (5) 34.6 416
Qualified XII (1.30) 12.49% (3) 5.1 61
Qualified XII (1.50) 2.23% (1) 626.5 7,501
Qualified XIII 6.14% 72,475.3 1,131,749
Qualified XV 6.14% 103,603.9 1,615,158
Qualified XVI 12.77% (3) 26,425.6 409,924
Qualified XVII 2.10% (5) 8,052.9 125,148
- ---------------------------------------------------------------------------------------------------------
Portfolio Partners, Inc.:
PPI MFS Emerging Equities Portfolio:
Qualified III (1.24%) (10) 2,707,903.5 40,744,426
Qualified V (1.24%) (10) 7,291.4 108,591
Qualified VI (1.24%) (10) 16,549,321.9 247,025,339
Qualified VIII (1.24%) (10) 10,982.3 171,736
Qualified X (1.15) (1.23%) (10) 97,555.0 1,462,430
Qualified X (1.25) (1.24%) (10) 1,368,373.2 20,425,179
Qualified XI (1.21%) (10) 573,527.6 8,611,492
Qualified XII (0.95) (1.21%) (10) 795,375.0 7,905,852
Qualified XII (1.00) (1.21%) (10) 180,890.4 1,796,534
Qualified XII (1.05) (1.22%) (10) 26,576.8 263,734
Qualified XII (1.10) (1.23%) (10) 15.5 154
Qualified XII (1.15) (1.23%) (10) 165,667.5 1,641,297
Qualified XII (1.25) (1.24%) (10) 98.6 975
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PPI MFS Emerging Equities Portfolio (continued):
Qualified XII (1.30) $10.007 $ 9.883 (1.25%) (10) 3,595.1 $ 35,529
Qualified XII (1.50) 9.976 9.850 (1.26%) (10) 2,412.5 23,764
Qualified XIII 15.183 14.999 (1.21%) (10) 586,517.3 8,796,970
Qualified XV 15.158 14.974 (1.21%) (10) 703,652.8 10,536,276
Qualified XVI 15.090 14.899 (1.26%) (10) 131,564.6 1,960,230
Qualified XVII 15.114 14.927 (1.24%) (10) 56,818.5 848,109
Qualified XVIII 15.114 14.927 (1.24%) (10) 40,758.2 608,382
Annuity contracts in payment period 23,166
- --------------------------------------------------------------------------------------------------------------------------
PPI MFS Research Growth Portfolio:
Qualified I 9.218 9.041 (1.93%) (10) 603.1 5,452
Qualified III 12.195 11.960 (1.93%) (10) 232,418.3 2,779,715
Qualified III* 13.339 13.082 (1.93%) (10) 1,105,890.0 14,467,144
Qualified V 13.953 13.682 (1.94%) (10) 9,637.0 131,852
Qualified VI 14.067 13.795 (1.93%) (10) 11,539,850.1 159,197,136
Qualified VII 11.855 11.627 (1.93%) (10) 37,934.1 441,067
Qualified VIII 11.865 11.636 (1.93%) (10) 11,790.2 137,194
Qualified IX 11.659 11.436 (1.91%) (10) 923.1 10,556
Qualified X (1.15) 14.124 13.852 (1.92%) (10) 1,447.4 20,050
Qualified X (1.25) 14.067 13.795 (1.93%) (10) 1,200,982.1 16,568,059
Qualified XI 14.147 13.877 (1.90%) (10) 418,964.5 5,814,029
Qualified XII (0.95) 8.897 8.727 (1.90%) (10) 484,407.2 4,227,485
Qualified XII (1.00) 8.890 8.720 (1.91%) (10) 55,615.9 484,969
Qualified XII (1.05) 8.883 8.713 (1.91%) (10) 1,465.3 12,766
Qualified XII (1.15) 8.869 8.698 (1.92%) (10) 122,863.4 1,068,726
Qualified XII (1.30) 8.848 8.677 (1.94%) (10) 1,788.0 15,515
Qualified XII (1.50) 8.821 8.649 (1.95%) (10) 442.0 3,823
Qualified XIII 14.131 13.862 (1.90%) (10) 317,032.5 4,394,718
Qualified XV 14.108 13.839 (1.90%) (10) 627,658.4 8,686,148
Qualified XVI 14.044 13.770 (1.95%) (10) 149,522.6 2,058,960
Qualified XVII 14.067 13.795 (1.93%) (10) 55,233.0 761,962
Qualified XVIII 14.067 13.795 (1.93%) (10) 91,612.6 1,263,835
Qualified XIX 9.218 9.041 (1.93%) (10) 40,144.2 362,939
Qualified XX 12.195 11.960 (1.93%) (10) 31,573.2 377,615
Qualified XXI 12.217 11.984 (1.90%) (10) 311,937.7 3,738,282
- --------------------------------------------------------------------------------------------------------------------------
PPI MFS Value Equity Portfolio:
Qualified III 23.106 23.440 1.45% (10) 2,018,219.2 47,308,001
Qualified V 18.976 19.248 1.43% (10) 8,823.9 169,842
Qualified VI 19.016 19.291 1.45% (10) 2,879,845.0 55,555,378
Qualified VIII 16.348 16.585 1.45% (10) 10,793.8 179,011
Qualified XI 19.123 19.405 1.47% (10) 192,553.3 3,736,539
Qualified XII (0.95) 12.296 12.478 1.47% (10) 96,338.0 1,202,064
Qualified XII (1.00) 12.287 12.467 1.47% (10) 68,968.3 859,852
Qualified XII (1.05) 12.277 12.457 1.47% (10) 1,514.2 18,862
Qualified XII (1.15) 12.258 12.437 1.46% (10) 79,382.1 987,249
Qualified XII (1.30) 12.230 12.406 1.44% (10) 237.4 2,945
Qualified XII (1.50) 12.192 12.365 1.42% (10) 79.6 984
Qualified XIII 19.102 19.384 1.47% (10) 84,592.2 1,639,745
Qualified XV 19.071 19.352 1.47% (10) 206,191.4 3,990,191
Qualified XVI 18.985 19.256 1.42% (10) 25,830.0 497,380
Qualified XVII 19.016 19.291 1.45% (10) 7,187.8 138,661
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Value
Per Unit Increase (Decrease) Units
-------- in Value of Outstanding Reserves
Beginning End of Accumulation at End at End
of Year Year Unit of Year of Year
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PPI Scudder International
Growth Portfolio:
Qualified III $17.490 $17.709 1.25% (10) 3,237,710.4 $ 57,336,876
Qualified V 16.577 16.782 1.24% (10) 4,333.3 72,721
Qualified VI 16.776 16.986 1.25% (10) 6,242,298.8 106,032,911
Qualified VIII 14.135 14.312 1.25% (10) 19,010.7 272,079
Qualified X (1.15) 16.844 17.056 1.26% (10) 34,029.9 580,423
Qualified X (1.25) 16.776 16.986 1.25% (10) 516,231.0 8,768,802
Qualified XI 16.871 17.087 1.28% (10) 295,952.2 5,056,840
Qualified XII (0.95) 11.376 11.522 1.28% (10) 351,150.2 4,045,783
Qualified XII (1.00) 11.367 11.512 1.27% (10) 80,978.2 932,228
Qualified XII (1.05) 11.358 11.503 1.27% (10) 8,780.0 100,993
Qualified XII (1.15) 11.341 11.484 1.26% (10) 77,528.2 890,314
Qualified XII (1.25) 11.323 11.465 1.25% (10) 189.0 2,167
Qualified XII (1.30) 11.314 11.456 1.25% (10) 200.2 2,294
Qualified XII (1.50) 11.279 11.418 1.23% (10) 2,664.8 30,426
Qualified XIII 16.853 17.068 1.28% (10) 273,402.1 4,666,454
Qualified XV 16.825 17.040 1.28% (10) 457,354.4 7,793,198
Qualified XVI 16.749 16.955 1.23% (10) 48,384.8 820,373
Qualified XVII 16.776 16.986 1.25% (10) 6,969.6 118,388
Qualified XVIII 16.776 16.986 1.25% (10) 10,054.0 170,779
Qualified XXI 17.521 17.745 1.28% (10) 282,098.1 5,005,766
- -----------------------------------------------------------------------------------------------------------------------
PPI T. Rowe Price Growth Equity
Portfolio:
Qualified III 16.276 16.608 2.04% (10) 1,317,058.3 21,873,787
Qualified V 14.357 14.647 2.03% (10) 2,583.0 37,834
Qualified VI 14.112 14.400 2.04% (10) 8,296,963.7 119,477,015
Qualified VIII 14.408 14.701 2.04% (10) 2,699.3 39,684
Qualified X (1.15) 15.848 16.172 2.04% (10) 44,362.1 717,444
Qualified X (1.25) 15.809 16.131 2.04% (10) 701,951.7 11,323,404
Qualified XI 14.192 14.485 2.07% (10) 212,653.8 3,080,351
Qualified XII (0.95) 13.062 13.332 2.07% (10) 238,562.3 3,180,516
Qualified XII (1.00) 13.052 13.321 2.06% (10) 65,906.1 877,941
Qualified XII (1.05) 13.042 13.310 2.06% (10) 18,428.7 245,289
Qualified XII (1.15) 13.021 13.288 2.05% (10) 42,110.3 559,576
Qualified XII (1.30) 12.991 13.256 2.04% (10) 1,649.4 21,864
Qualified XII (1.50) 12.951 13.212 2.02% (10) 3,802.0 50,233
Qualified XIII 14.176 14.470 2.07% (10) 227,469.2 3,291,368
Qualified XV 14.153 14.445 2.07% (10) 200,373.9 2,894,493
Qualified XVI 14.090 14.374 2.02% (10) 79,799.1 1,147,016
Qualified XVII 14.112 14.400 2.04% (10) 24,650.4 354,967
Qualified XVIII 15.809 16.131 2.04% (10) 17,219.3 277,771
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
*Applies only to participants of the Opportunity Plus program and Multiple
Options Portfolio
Qualified I Individual contracts issued prior to May 1, 1975 in
connection with "Qualified Corporate Retirement Plans"
established pursuant to Section 401 of the Internal Revenue
Code ("Code"); Tax-Deferred Annuity Plans established by the
public school systems and tax-exempt organizations pursuant
to Section 403(b) of the Code, and certain Individual
Retirement Annuity Plans established by or on behalf of
individuals pursuant to section 408(b) of the Code;
Individual contracts issued prior to November 1, 1975 in
connection with "H.R. 10 Plans" established by persons
entitled to the benefits of the Self-Employed Individuals
Tax Retirement Act of 1962, as amended; allocated group
contracts issued prior to May 1, 1975 in connection with
Qualified Corporate Retirement Plans; and group contracts
issued prior to October 1, 1978 in connection with
Tax-Deferred Annuity Plans.
Qualified III Individual contracts issued in connection with Tax-Deferred
Annuity Plans and Individual Retirement Annuity Plans since
May 1, 1975, H.R. 10 Plans since November 1, 1975; group
contracts issued since October 1, 1978 in connection with
Tax-Deferred Annuity Plans and group contracts issued since
May 1, 1979 in connection with "Deferred Compensation Plans"
adopted by state and local governments and H.R. 10 Plans.
Qualified V Group AetnaPlus contracts issued since August 28, 1992 in
connection with "Optional Retirement Plans" established
pursuant to Section 403(b) or 401(a) of the Internal Revenue
Code.
Qualified VI Group AetnaPlus contracts issued in connection with
Tax-Deferred Annuity Plans and Retirement Plus Plans since
August 28, 1992.
<PAGE>
Variable Annuity Account C
Condensed Financial Information - Year Ended December 31, 1997 (continued):
Qualified VII Certain existing contracts that were converted to ACES, an
administrative system (previously valued under Qualified I).
Qualified VIII Group AetnaPlus contracts issued in connection with
Tax-Deferred Annuity Plans and "Deferred Compensation Plans"
adopted by state and local governments since June 30, 1993.
Qualified IX Certain large group contracts (Jumbo) that were converted to
ACES, an administrative system (previously valued under
Qualified VI).
Qualified X Individual Retirement Annuity and Simplified Employee
Pension Plans issued or converted to ACES, an administrative
system.
Qualified XI Certain large group contracts issued in connection with
"Deferred Compensation Plans" adopted by state and local
governments since January 1996.
Qualified XII Group "Deferred Compensation Plan" contracts shown
separately by applicable daily charge.
Qualified XIII Certain existing contracts issued in connection with
Tax-Deferred Annuity Plans and Retirement Plus Plans issued
through product exchange (previously valued under Qualified
VI).
Qualified XIV Certain existing contracts issued in connection with
Tax-Deferred Annuity Plans that were converted to ACES, an
administrative system (previously valued under Qualified
III).
Qualified XV Certain existing contracts issued in connection with
Tax-Deferred Annuity Plans (previously valued under
Qualified VI).
Qualified XVI Group AetnaPlus contracts issued in connection with
"Deferred Compensation Plans" having contract modifications
effective April 7, 1997.
Qualified XVII Group AetnaPlus contracts issued in connection with
"Deferred Compensation Plans" having contract modifications
effective May 29, 1997.
Qualified XVIII Group AetnaPlus contracts issued in connection with
"Deferred Compensation Plans" having contract modifications
effective May 29, 1997.
Qualified XIX Group AetnaPlus contracts issued in connection with
"Deferred Compensation Plans" having contract modifications
effective May 29, 1997.
Qualified XX Group AetnaPlus contracts issued in connection with
"Deferred Compensation Plans" having contract modifications
effective May 29, 1997.
Qualified XXI Group 457 contracts issued in connection with "Deferred
Compensation Plans" issued to employees of the County of San
Jose.
Notes to Condensed Financial Information
(1) - Reflects less than a full year of performance activity. Funds were first
received in this option during January 1997.
(2) - Reflects less than a full year of performance activity. Funds were first
received in this option during February 1997.
(3) - Reflects less than a full year of performance activity. Funds were first
received in this option during April 1997.
(4) - Reflects less than a full year of performance activity. Funds were first
received in this option during May 1997.
(5) - Reflects less than a full year of performance activity. Funds were first
received in this option during June 1997.
(6) - Reflects less than a full year of performance activity. Funds were first
received in this option during July 1997.
(7) - Reflects less than a full year of performance activity. Funds were first
received in this option during August 1997.
(8) - Reflects less than a full year of performance activity. Funds were first
received in this option during September 1997.
(9) - Reflects less than a full year of performance activity. Funds were first
received in this option during October 1997.
(10) - Reflects less than a full year of performance activity. Funds were first
received in this option during November 1997.
(11) - Reflects less than a full year of performance activity. Funds were first
received in this option during December 1997.
See Notes to Financial Statements
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997
1. Summary of Significant Accounting Policies
Variable Annuity Account C (the "Account") is a separate account
established by Aetna Life Insurance and Annuity Company (the "Company") and
is registered under the Investment Company Act of 1940 as a unit investment
trust. The Account is sold exclusively for use with variable annuity
contracts that are qualified under the Internal Revenue Code of 1986, as
amended.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect amounts reported therein. Although actual results
could differ from these estimates, any such differences are expected to be
immaterial to the net assets of the Account.
a. Valuation of Investments
Investments in the following Funds are stated at the closing net asset
value per share as determined by each Fund on December 31, 1997:
Aetna Variable Fund
Aetna Income Shares
Aetna Variable Encore Fund
Aetna Investment Advisers Fund, Inc.
Aetna GET Fund, Series B
Aetna GET Fund, Series C
Aetna Ascent Variable Portfolio
Aetna Crossroads Variable Portfolio
Aetna Legacy Variable Portfolio
Aetna Variable Portfolios, Inc.:
[bullet] Aetna Variable Capital Appreciation Portfolio
[bullet] Aetna Variable Growth Portfolio
[bullet] Aetna Variable Index Plus Portfolio
[bullet] Aetna Variable Small Company Portfolio
Calvert Social Balanced Portfolio
Fidelity Investments Variable Insurance Products Fund:
[bullet] Equity-Income Portfolio
[bullet] Growth Portfolio
[bullet] Overseas Portfolio
Fidelity Investments Variable Insurance Products
Fund II:
[bullet] Asset Manger Portfolio
[bullet] Contrafund Portfolio
[bullet] Index 500 Portfolio
Janus Aspen Series:
[bullet] Aggressive Growth Portfolio
[bullet] Balanced Portfolio
[bullet] Flexible Income Portfolio
[bullet] Growth Portfolio
[bullet] Worldwide Growth Portfolio
Lexington Emerging Markets Fund
Lexington Natural Resources Trust Fund
Portfolio Partners, Inc.:
[bullet] PPI MFS Emerging Equities Portfolio
[bullet] PPI MFS Research Growth Portfolio
[bullet] PPI MFS Value Equity Portfolio
[bullet] PPI Scudder International Growth Portfolio
[bullet] PPI T. Rowe Price Growth Equity Portfolio
b. Other
Investment transactions are accounted for on a trade date basis and
dividend income is recorded on the ex-dividend date. The cost of
investments sold is determined by specific identification.
c. Federal Income Taxes
The operations of the Account form a part of, and are taxed with, the total
operations of the Company which is taxed as a life insurance company under
the Internal Revenue Code of 1986, as amended.
d. Annuity Reserves
Annuity reserves held in the Account are computed for currently payable
contracts according to the Progressive Annuity, a49, 1971 Individual
Annuity Mortality, 1971 Group Annuity Mortality, 83a, and 1983 Group
Annuity Mortality tables using various assumed interest rates not to exceed
seven percent. Mortality experience is monitored by the Company. Charges to
annuity reserves for mortality experience are reimbursed to the Company if
the reserves required are less than originally estimated. If additional
reserves are required, the Company reimburses the Account.
2. Valuation Period Deductions
Deductions by the Account for mortality and expense risk charges are made
in accordance with the terms of the contracts and are paid to the Company.
3. Dividend Income
On an annual basis, the Funds distribute substantially all of their taxable
income and realized capital gains to their shareholders. Distributions to
the Account are automatically reinvested in shares of the Funds. The
Account's proportionate share of each Fund's undistributed net investment
income (distributions in excess of net investment income) and accumulated
net realized gain (loss) on investments is included in net unrealized gain
(loss) in the Statements of Operations and Changes in Net Assets.
4. Purchases and Sales of Investments
The cost of purchases and proceeds from sales of investments other than
short-term investments for the years ended December 31, 1997 and 1996
aggregated $4,059,988,283 and $2,013,561,413; $3,462,016,312 and
$2,060,808,031, respectively.
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997 (continued):
5. Supplemental Information to Statements of Operations and Changes in Net
Assets
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
Year Ended December 31, 1997
Valuation
Period
Dividends Deductions
- ---------------------------------------------------------------------------------------
<S> <C> <C>
Aetna Variable Fund: $1,291,034,822 ($ 68,500,273)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
Aetna Income Shares: 22,258,737 (4,263,839)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
Aetna Variable Encore Fund: 9,635,587 (2,938,575)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Investment Advisers Fund, Inc.: 128,304,517 (10,844,018)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
Aetna GET Fund, Series B: 13,341,021 (1,078,816)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna GET Fund, Series C: 3,678,012 (3,257,441)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Ascent Variable Portfolio: 4,541,482 (578,657)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Crossroads Variable Portfolio: 3,316,159 (392,434)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Legacy Variable Portfolio: 1,788,369 (229,584)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
Aetna Variable Portfolios Inc:
Aetna Variable Capital Appreciation Portfolio: 312,433 (2,197)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Variable Growth Portfolio: 249,335 (1,093)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Aetna Variable Index Plus Portfolio: 3,327,658 (542,532)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
Aetna Variable Small Company Portfolio: 269,004 (5,868)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Alger American Funds:
Growth Portfolio: (1) 1,199,482 (1,526,918)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------
Small Capitalization Portfolio: 11,721,861 (3,575,543)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------
<CAPTION>
- --------------------------------------------------------------------------------------------------
Year Ended December 31, 1997
Proceeds Cost of Net
from Investments Realized
Sales Sold Gain (Loss)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Aetna Variable Fund: $205,088,291 $150,120,010 $ 54,968,281
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
Aetna Income Shares: 46,789,033 49,260,722 (2,471,689)
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
Aetna Variable Encore Fund: 206,958,669 210,166,945 (3,208,276)
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Investment Advisers Fund, Inc.: 37,558,168 27,770,494 9,787,674
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
Aetna GET Fund, Series B: 7,648,728 4,940,723 2,708,005
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna GET Fund, Series C: 13,972,003 11,896,317 2,075,686
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Ascent Variable Portfolio: 498,613 380,091 118,522
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Crossroads Variable Portfolio: 409,248 325,568 83,680
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Legacy Variable Portfolio: 2,265,127 2,019,840 245,287
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
Aetna Variable Portfolios Inc:
Aetna Variable Capital Appreciation Portfolio: 123,165 113,851 9,314
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Variable Growth Portfolio: 80,207 72,190 8,017
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Aetna Variable Index Plus Portfolio: 29,980,862 29,823,433 157,429
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
Aetna Variable Small Company Portfolio: 478,457 428,319 50,138
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Alger American Funds:
Growth Portfolio: (1) 169,481,196 134,718,793 34,762,403
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------
Small Capitalization Portfolio: 403,516,606 343,440,431 60,076,175
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Net Unrealized Net
Gain (Loss) Net Increase (Decrease) Net Assets
----------- Change in In Net Assets ----------
Beginning End Unrealized from Unit Beginning End
of Year of Year Gain (Loss) Transactions of Year of Year
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$327,744,944 $438,575,885 $110,830,941 $ 75,435,966
$4,694,078,344 $6,078,549,136
212,746,872 292,045,818
- -----------------------------------------------------------------------------------------------------------------------
(9,314,233) (1,128,028) 8,186,205 (4,710,418)
5,616,023 6,218,756
- -----------------------------------------------------------------------------------------------------------------------
(750,036) 5,712,842 6,462,878 (14,909,883)
245,304,466 240,346,197
- -----------------------------------------------------------------------------------------------------------------------
97,219,569 141,499,248 44,279,679 2,724,400
800,532,626 968,354,403
14,762,802 21,193,276
- -----------------------------------------------------------------------------------------------------------------------
17,286,695 22,946,346 5,659,651 (6,139,082)
65,062,153 79,552,932
- -----------------------------------------------------------------------------------------------------------------------
2,983,885 46,742,374 43,758,489 (8,490,216)
199,058,163 236,822,693
- -----------------------------------------------------------------------------------------------------------------------
1,716,824 5,507,794 3,790,970 42,582,396
21,660,591 72,115,304
- -----------------------------------------------------------------------------------------------------------------------
838,329 2,614,303 1,775,974 30,197,010
14,758,921 49,739,310
- -----------------------------------------------------------------------------------------------------------------------
112,482 588,337 475,855 21,455,983
9,067,002 32,749,254
0 53,658
- -----------------------------------------------------------------------------------------------------------------------
0 (274,002) (274,002) 1,994,092
0 2,039,640
- -----------------------------------------------------------------------------------------------------------------------
0 (237,223) (237,223) 1,079,447
0 1,098,483
- -----------------------------------------------------------------------------------------------------------------------
80,325 6,964,574 6,884,249 62,694,836
10,653,437 83,098,319
0 76,758
- -----------------------------------------------------------------------------------------------------------------------
0 (166,700) (166,700) 4,809,638
0 4,956,212
- -----------------------------------------------------------------------------------------------------------------------
6,730,808 0 (6,730,808) (132,576,331)
104,872,172 0
- -----------------------------------------------------------------------------------------------------------------------
39,364,541 0 (39,364,541) (352,729,122)
323,871,170 0
0 0
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997 (continued):
5. Supplemental Information to Statements of Operations and Changes in Net
Assets (continued):
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Year Ended December 31, 1997
Valuation
Period
Dividends Deductions
- -------------------------------------------------------------------------------------------
<S> <C> <C>
American Century Investments -
Capital Appreciation Fund: (2) $ 5,882,464 ($ 2,974,651)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Calvert Social Balanced Portfolio: 3,787,208 (578,804)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio: 11,536,379 (1,844,101)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Growth Portfolio: 3,033,640 (1,277,878)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Overseas Portfolio: 762,691 (144,474)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio: 2,134,313 (253,981)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Contrafund Portfolio: 4,376,096 (2,382,593)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Index 500 Portfolio: 890,215 (515,853)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Franklin Government Securities Trust: (3) 1,578,341 (279,189)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Janus Aspen Series:
Aggressive Growth Portfolio: 0 (2,188,842)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Balanced Portfolio: 940,676 (329,511)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Flexible Income Portfolio: 757,640 (131,213)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Growth Portfolio: 1,871,919 (768,752)
Annuity contracts in accumulation
Annuity contracts in payment period
- -------------------------------------------------------------------------------------------
Short-Term Bond Portfolio: (4) 64,108 (25,465)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------
Worldwide Growth Portfolio: 5,510,563 (4,109,527)
Annuity contracts in accumulation
Annuity contracts in payment period
- -------------------------------------------------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
Year Ended December 31, 1997
Proceeds Cost of Net
from Investments Realized
Sales Sold Gain (Loss)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
American Century Investments -
Capital Appreciation Fund: (2) $347,378,690 $348,986,817 ($ 1,608,127)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Calvert Social Balanced Portfolio: 1,767,421 1,342,657 424,764
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio: 2,876,456 2,187,102 689,354
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Growth Portfolio: 1,967,157 1,268,813 698,344
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Overseas Portfolio: 6,265,740 5,529,606 736,134
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio: 1,353,806 1,132,813 220,993
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Contrafund Portfolio: 989,526 754,795 234,731
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Index 500 Portfolio: 2,042,782 1,517,607 525,175
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Franklin Government Securities Trust: (3) 35,001,358 34,302,739 698,619
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Janus Aspen Series:
Aggressive Growth Portfolio: 16,697,333 12,596,723 4,100,610
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Balanced Portfolio: 1,236,230 981,509 254,721
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Flexible Income Portfolio: 4,035,296 3,816,553 218,743
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Growth Portfolio: 1,933,431 1,461,183 472,248
Annuity contracts in accumulation
Annuity contracts in payment period
- -------------------------------------------------------------------------------------------------------------
Short-Term Bond Portfolio: (4) 5,452,797 5,400,161 52,636
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------------------------------
Worldwide Growth Portfolio: 16,620,763 10,266,465 6,354,298
Annuity contracts in accumulation
Annuity contracts in payment period
- -------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Net Unrealized Net
Gain (Loss) Net Increase (Decrease) Net Assets
----------- Change in In Net Assets ----------
Beginning End Unrealized from Unit Beginning End
of Year of Year Gain (Loss) Transactions of Year of Year
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 8,139,519 $0 ($8,139,519) ($339,404,560)
$346,244,393 $0
- ----------------------------------------------------------------------------------------------------------------
2,963,927 7,196,636 4,232,709 6,589,199
39,989,335 54,444,411
- ----------------------------------------------------------------------------------------------------------------
10,675,870 33,998,298 23,322,428 50,561,862
106,469,428 190,735,350
- ----------------------------------------------------------------------------------------------------------------
5,256,264 22,394,599 17,138,335 28,222,857
80,442,047 128,257,345
- ----------------------------------------------------------------------------------------------------------------
649,630 225,478 (424,152) 4,069,619
8,449,388 13,449,206
- ----------------------------------------------------------------------------------------------------------------
2,502,591 3,922,056 1,419,465 2,575,422
17,103,129 23,199,341
- ----------------------------------------------------------------------------------------------------------------
15,161,493 50,217,979 35,056,486 100,377,564
118,886,521 256,548,805
- ----------------------------------------------------------------------------------------------------------------
2,304,865 11,512,547 9,207,682 26,383,649
21,230,903 57,721,771
- ----------------------------------------------------------------------------------------------------------------
405,959 0 (405,959) (24,948,755)
23,356,943 0
- ----------------------------------------------------------------------------------------------------------------
17,668,916 36,485,267 18,816,351 16,995,758
172,876,567 210,600,444
- ----------------------------------------------------------------------------------------------------------------
751,567 4,804,494 4,052,927 17,251,901
15,281,267 37,451,981
- ----------------------------------------------------------------------------------------------------------------
140,666 381,113 240,447 5,252,958
8,417,464 14,756,039
- ----------------------------------------------------------------------------------------------------------------
2,192,571 11,683,190 9,490,619 28,161,560
40,800,809 79,992,417
0 35,986
- ----------------------------------------------------------------------------------------------------------------
(6,468) 0 6,468 (1,788,353)
1,690,606 0
- ----------------------------------------------------------------------------------------------------------------
16,710,390 62,504,868 45,794,478 203,261,915
172,398,274 429,093,163
0 116,838
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997 (continued):
5. Supplemental Information to Statements of Operations and Changes in Net
Assets (continued):
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
Year Ended December 31, 1997
Valuation
Period
Dividends Deductions
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Lexington Emerging Markets Fund: $4,375 ($79,412)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
Lexington Natural Resources Trust Fund: 1,239,038 (531,930)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
Neuberger and Berman Advisers Management Trust -
Growth Portfolio: (5) 8,158,940 (1,195,227)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
Portfolio Partners, Inc.:
PPI MFS Emerging Equities Portfolio: 0 (406,682)
Annuity contracts in accumulation
Annuity contracts in payment period
- -----------------------------------------------------------------------------------------
PPI MFS Research Growth Portfolio: 0 (262,081)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
PPI MFS Value Equity Portfolio: 0 (133,426)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
PPI MFS Scudder International Growth Portfolio: 0 (235,626)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
PPI MFS T. Rowe Price Growth Equity Portfolio: 0 (193,734)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
Scudder Variable Life Investment Fund -
International Portfolio: (6) 4,599,123 (2,286,635)
Annuity contracts in accumulation
- -----------------------------------------------------------------------------------------
Total Variable Annuity Account C $1,552,106,208 ($ 120,867,375)
========================================================================================
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Year Ended December 31, 1997
Proceeds Cost of Net
from Investments Realized
Sales Sold Gain (Loss)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Lexington Emerging Markets Fund: $1,639,618 $1,424,729 $214,889
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
Lexington Natural Resources Trust Fund: 14,866,827 11,618,994 3,247,833
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
Neuberger and Berman Advisers Management Trust -
Growth Portfolio: (5) 128,039,479 103,983,767 24,055,712
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
Portfolio Partners, Inc.:
PPI MFS Emerging Equities Portfolio: 3,797,005 3,880,012 (83,007)
Annuity contracts in accumulation
Annuity contracts in payment period
- ---------------------------------------------------------------------------------------------------------
PPI MFS Research Growth Portfolio: 1,453,829 1,486,006 (32,177)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
PPI MFS Value Equity Portfolio: 928,145 929,114 (969)
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
PPI MFS Scudder International Growth Portfolio: 13,091,485 12,881,912 209,573
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
PPI MFS T. Rowe Price Growth Equity Portfolio: 891,088 887,544 3,544
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
Scudder Variable Life Investment Fund -
International Portfolio: (6) 278,386,778 238,895,623 39,491,155
Annuity contracts in accumulation
- ---------------------------------------------------------------------------------------------------------
Total Variable Annuity Account C $2,013,561,413 $1,773,010,971 $240,550,442
=========================================================================================================
</TABLE>
(1) Effective November 28, 1997, this funds assets were transferred to the PPI
T. Rowe Price Growth Equity Portfolio.
(2) Effective November 28, 1997, this funds assets were transferred to the PPI
MFS Research Growth Portfolio.
(3) Effective November 28, 1997, this funds assets were transferred to Aetna
Income Shares.
(4) Effective November 28, 1997, this funds assets were transferred to the Aetna
Variable Encore Fund.
(5) Effective November 28, 1997, this funds assets were transferred to the PPI
MFS Value Equity Portfolio.
(6) Effective November 28, 1997, this funds assets were transferred to the PPI
Scudder International Growth Portfolio.
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Net Unrealized Net
Gain (Loss) Net Increase (Decrease) Net Assets
----------- Change in In Net Assets ----------
Beginning End Unrealized from Unit Beginning End
of Year of Year Gain (Loss) Transactions of Year of Year
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$102,991 ($968,279) ($1,071,270) $1,874,530
$4,845,481 $5,788,593
- ------------------------------------------------------------------------------------------------------------------------
3,997,171 1,786,893 (2,210,278) 17,376,715
23,844,347 42,965,725
- ------------------------------------------------------------------------------------------------------------------------
9,459,521 0 (9,459,521) (116,641,588)
95,081,684 0
- ------------------------------------------------------------------------------------------------------------------------
0 (3,901,193) (3,901,193) 357,381,047
0 352,966,999
0 23,166
- ------------------------------------------------------------------------------------------------------------------------
0 (4,166,217) (4,166,217) 231,490,472
0 227,029,997
- ------------------------------------------------------------------------------------------------------------------------
0 1,637,084 1,637,084 114,784,015
0 116,286,704
- ------------------------------------------------------------------------------------------------------------------------
0 3,033,630 3,033,630 199,692,238
0 202,699,815
- ------------------------------------------------------------------------------------------------------------------------
0 3,371,568 3,371,568 166,269,175
0 169,450,553
- ------------------------------------------------------------------------------------------------------------------------
29,299,509 0 (29,299,509) (204,019,879)
191,515,746 0
- ------------------------------------------------------------------------------------------------------------------------
$612,391,085 $915,465,761 $303,074,676 $615,188,037 $8,565,202,363 $11,155,254,351
========================================================================================================================
</TABLE>
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997 (continued):
5. Supplemental Information to Statements of Operations and Changes in Net
Assets (continued):
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------
Year Ended December 31, 1996
Valuation
Period
Dividends Deductions
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
Aetna Variable Fund: $515,238,366 ($54,321,686)
Annuity contracts in accumulation
Annuity contracts in payment period
- ----------------------------------------------------------------------------------------------
Aetna Income Shares: 23,144,319 (4,611,478)
Annuity contracts in accumulation
Annuity contracts in payment period
- ----------------------------------------------------------------------------------------------
Aetna Variable Encore Fund: 14,058,252 (2,878,790)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna Investment Advisers Fund, Inc.: 72,699,670 (9,562,496)
Annuity contracts in accumulation
Annuity contracts in payment period
- ----------------------------------------------------------------------------------------------
Aetna GET Fund, Series B: 5,304,368 (1,100,778)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna GET Fund, Series C: 969,084 (280,865)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna Ascent Variable Portfolio: 963,171 (137,931)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna Crossroads Variable Portfolio: 797,511 (106,179)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna Legacy Variable Portfolio: 595,666 (63,355)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Aetna Variable Index Plus Portfolio: 57,328 (16,537)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Alger American Funds:
Growth Portfolio: 2,138,198 (966,404)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Small Capitalization Portfolio: 1,173,212 (3,731,877)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Calvert Responsibly Invested Balanced Fund: 3,000,539 (425,159)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio: 2,269,871 (994,896)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Growth Portfolio: 2,304,888 (707,334)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Overseas Portfolio: 115,737 (82,498)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio: 955,910 (196,386)
Annuity contracts in accumulation
- ----------------------------------------------------------------------------------------------
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
Year Ended December 31, 1996
Proceeds Cost of Net
from Investments Realized
Sales Sold Gain (Loss)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Aetna Variable Fund: $1,237,963,630 $841,837,896 $396,125,734
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------------------
Aetna Income Shares: 155,474,786 153,469,788 2,004,998
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------------------
Aetna Variable Encore Fund: 175,207,017 167,163,639 8,043,378
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna Investment Advisers Fund, Inc.: 223,353,174 160,905,519 62,447,655
Annuity contracts in accumulation
Annuity contracts in payment period
- --------------------------------------------------------------------------------------------------------------
Aetna GET Fund, Series B: 25,117,816 18,596,857 6,520,959
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna GET Fund, Series C: 229,569 224,240 5,329
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna Ascent Variable Portfolio: 514,612 443,710 70,902
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna Crossroads Variable Portfolio: 755,620 679,118 76,502
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna Legacy Variable Portfolio: 1,206,903 1,119,490 87,413
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Aetna Variable Index Plus Portfolio: 356,603 338,531 18,072
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Alger American Funds:
Growth Portfolio: 3,326,813 3,149,890 176,923
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Small Capitalization Portfolio: 24,333,106 17,577,100 6,756,006
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Calvert Responsibly Invested Balanced Fund: 1,793,014 1,429,393 363,621
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund:
Equity-Income Portfolio: 3,851,613 3,166,678 684,935
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Growth Portfolio: 623,639 453,561 170,078
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Overseas Portfolio: 2,280,928 2,065,136 215,792
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
Fidelity Investments Variable Insurance Products Fund II:
Asset Manager Portfolio: 2,016,939 1,797,456 219,483
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
Net Unrealized Net
Gain (Loss) Net Increase (Decrease) Net Assets
----------- Change in In Net Assets ----------
Beginning End Unrealized from Unit Beginning End
of Year of Year Gain (Loss) Transactions of Year of Year
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$267,567,573 $327,744,944 $60,177,371 $39,664,335
$3,805,891,355 $4,694,078,344
144,049,741 212,746,872
- --------------------------------------------------------------------------------------------------------------------------
3,230,862 (9,314,233) (12,545,095) (34,151,027)
380,937,626 354,233,289
5,069,969 5,616,023
- --------------------------------------------------------------------------------------------------------------------------
9,204,418 (750,036) (9,954,454) 5,744,394
230,291,686 245,304,466
- --------------------------------------------------------------------------------------------------------------------------
122,622,603 97,219,569 (25,403,034) (7,904,062)
713,304,833 800,532,626
9,712,862 14,762,802
- --------------------------------------------------------------------------------------------------------------------------
13,423,804 17,286,695 3,862,891 (22,661,545)
73,136,258 65,062,153
- --------------------------------------------------------------------------------------------------------------------------
0 2,983,885 2,983,885 195,380,730
0 199,058,163
- --------------------------------------------------------------------------------------------------------------------------
105,405 1,716,824 1,611,419 14,244,294
4,908,736 21,660,591
- --------------------------------------------------------------------------------------------------------------------------
68,967 838,329 769,362 9,552,968
3,668,757 14,758,921
- --------------------------------------------------------------------------------------------------------------------------
36,214 112,482 76,268 6,451,330
1,919,680 9,067,002
- --------------------------------------------------------------------------------------------------------------------------
0 80,325 80,325 10,514,249
0 10,653,437
- --------------------------------------------------------------------------------------------------------------------------
(285,937) 6,730,808 7,016,745 58,052,710
38,454,000 104,872,172
- --------------------------------------------------------------------------------------------------------------------------
38,038,924 39,364,541 1,325,617 77,101,765
241,246,447 323,871,170
- --------------------------------------------------------------------------------------------------------------------------
2,175,908 2,963,927 788,019 7,573,554
28,688,761 39,989,335
- --------------------------------------------------------------------------------------------------------------------------
2,759,687 10,675,870 7,916,183 58,569,396
38,023,939 106,469,428
- --------------------------------------------------------------------------------------------------------------------------
505,388 5,256,264 4,750,876 46,205,811
27,717,728 80,442,047
- --------------------------------------------------------------------------------------------------------------------------
163,196 649,630 486,434 3,994,936
3,718,987 8,449,388
- --------------------------------------------------------------------------------------------------------------------------
1,530,985 2,502,591 971,606 782,358
14,370,158 17,103,129
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Variable Annuity Account C
Notes to Financial Statements - December 31, 1997 (continued):
5. Supplemental Information to Statements of Operations and Changes in Net
Assets (continued):
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
Year Ended December 31, 1996
Valuation
Period
Dividends Deductions
- -------------------------------------------------------------------------------------
<S> <C> <C>
Contrafund Portfolio: $357,388 ($910,633)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Index 500 Portfolio: 219,199 (139,391)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Franklin Government Securities Trust: 1,223,061 (290,354)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Janus Aspen Series:
Aggressive Growth Portfolio: 1,589,459 (1,739,222)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Balanced Portfolio: 238,807 (87,725)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Flexible Income Portfolio: 499,929 (72,736)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Growth Portfolio: 630,364 (245,877)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Short-Term Bond Portfolio: 61,378 (14,453)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Worldwide Growth Portfolio: 1,725,690 (1,035,043)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Lexington Emerging Markets Fund: 0 (55,554)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Lexington Natural Resources Trust Fund: 80,144 (231,100)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Neuberger and Berman Advisers Management Trust -
Growth Portfolio: 8,437,018 (1,199,983)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Scudder Variable Life Investment Fund -
International Portfolio: 4,063,525 (2,264,627)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
TCI Portfolios, Inc. - Growth Fund: 47,942,547 (4,974,984)
Annuity contracts in accumulation
- -------------------------------------------------------------------------------------
Total Variable Annuity Account C $712,854,599 ($ 93,446,331)
=====================================================================================
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Year Ended December 31, 1996
Proceeds Cost of Net
from Investments Realized
Sales Sold Gain (Loss)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Contrafund Portfolio: $1,299,964 $1,078,898 $221,066
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Index 500 Portfolio: 1,105,697 943,071 162,626
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Franklin Government Securities Trust: 5,788,894 5,646,267 142,627
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Janus Aspen Series:
Aggressive Growth Portfolio: 4,803,682 3,702,615 1,101,067
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Balanced Portfolio: 1,671,701 1,511,274 160,427
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Flexible Income Portfolio: 1,541,843 1,429,353 112,490
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Growth Portfolio: 1,130,979 963,703 167,276
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Short-Term Bond Portfolio: 726,351 729,002 (2,651)
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Worldwide Growth Portfolio: 1,942,344 1,492,553
449,791
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Lexington Emerging Markets Fund: 905,228 870,164 35,064
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Lexington Natural Resources Trust Fund: 7,649,108 6,026,027 1,623,081
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Neuberger and Berman Advisers Management Trust -
Growth Portfolio: 15,336,623 13,853,081 1,483,542
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Scudder Variable Life Investment Fund -
International Portfolio: 26,981,873 22,523,390 4,458,483
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
TCI Portfolios, Inc. - Growth Fund: 131,517,962 112,052,109 19,465,853
Annuity contracts in accumulation
- --------------------------------------------------------------------------------------------------------
Total Variable Annuity Account C $2,060,808,031 $1,547,239,509 $513,568,522
========================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
Net Unrealized Net
Gain (Loss) Net Increase (Decrease) Net Assets
----------- Change in In Net Assets ----------
Beginning End Unrealized from Unit Beginning End
of Year of Year Gain (Loss) Transactions of Year of Year
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$285,166 $15,161,493 $14,876,327 $73,985,256
$30,357,117 $118,886,521
- ----------------------------------------------------------------------------------------------------------------------
223,865 2,304,865 2,081,000 15,496,325
3,411,144 21,230,903
- ----------------------------------------------------------------------------------------------------------------------
831,241 405,959 (425,282) 664,776
22,042,115 23,356,943
- ----------------------------------------------------------------------------------------------------------------------
13,091,398 17,668,916 4,577,518 79,952,029
87,395,716 172,876,567
- ----------------------------------------------------------------------------------------------------------------------
60,530 751,567 691,037 12,773,551
1,505,170 15,281,267
- ----------------------------------------------------------------------------------------------------------------------
167,581 140,666 (26,915) 4,046,573
3,858,123 8,417,464
- ----------------------------------------------------------------------------------------------------------------------
145,978 2,192,571 2,046,593 33,135,966
5,066,487 40,800,809
- ----------------------------------------------------------------------------------------------------------------------
(354) (6,468) (6,114) 1,108,236
544,210 1,690,606
- ----------------------------------------------------------------------------------------------------------------------
786,497 16,710,390 15,923,893 139,287,080
16,046,863 172,398,274
- ----------------------------------------------------------------------------------------------------------------------
(46,118) 102,991 149,109 1,627,816
3,089,046 4,845,481
- ----------------------------------------------------------------------------------------------------------------------
1,277,740 3,997,171 2,719,431 5,442,307
14,210,484 23,844,347
- ----------------------------------------------------------------------------------------------------------------------
11,656,721 9,459,521 (2,197,200) (937,272)
89,495,579 95,081,684
- ----------------------------------------------------------------------------------------------------------------------
12,783,439 29,299,509 16,516,070 4,017,712
164,724,583 191,515,746
- ----------------------------------------------------------------------------------------------------------------------
91,671,503 8,139,519 (83,531,984) (57,916,538)
425,259,499 346,244,393
- ----------------------------------------------------------------------------------------------------------------------
$ 594,083,184 $612,391,085 $ 18,307,901 $ 781,800,013 $6,632,117,659 $8,565,202,363
======================================================================================================================
</TABLE>
<PAGE>
Independent Auditors' Report
The Board of Directors of Aetna Life Insurance and Annuity Company and
Contract Owners of Variable Annuity Account C:
We have audited the accompanying statement of assets and liabilities of Aetna
Life Insurance and Annuity Company Variable Annuity Account C (the "Account")
as of December 31, 1997, and the related statements of operations and changes
in net assets for each of the years in the two-year period then ended and
condensed financial information for the year ended December 31, 1997. These
financial statements and condensed financial information are the responsibility
of the Account's management. Our responsibility is to express an opinion on
these financial statements and condensed financial information based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and condensed
financial information are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and condensed financial information. Our procedures
included confirmation of securities owned as of December 31, 1997, by
correspondence with the custodian. 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 and condensed financial information
referred to above present fairly, in all material respects, the financial
position of Aetna Life Insurance and Annuity Company Variable Annuity Account C
as of December 31, 1997, the results of its operations and changes in its net
assets for each of the years in the two-year period then ended and condensed
financial information for the year ended December 31, 1997 in conformity with
generally accepted accounting principles.
KPMG Peat Marwick LLP
Hartford, Connecticut
February 27, 1998
