FORM NSAR-U
SEMI-ANNUAL REPORT
FOR REGISTERED INVESTMENT COMPANIES
Report for six month period ending: / / (a)
or fiscal year ending: 12 / 31 /1998 (b)
Is this a transition report?: (Y/N) N
--------
Is this an amendment to a previous filing? (Y/N) N
--------
Those items or sub-items with a box "**" after the item number should be
completed only if the answer has changed from the previous filing on this form.
1. A. Registrant Name: AUL American Individual Variable Life Unit Trust
B. File Number: 811-8536
C. Telephone Number: ( 317 ) 285-1877
2. A. Street: One American Square, P.O. Box 368
B. City: Indianapolis C. State: IN D. Zip Code:46206 Zip Ext:0368
E. Foreign Country: Foreign Postal Code:
3. Is this the first filing on this form by Registrant? (Y/N) Y
4. Is this the last filing on this form by Registrant? (Y/N) N
5. Is Registrant a small business investment company (SBIC)? (Y/N) N
[If answer is "Y" (Yes), complete only items 89 through 110.
6. Is Registrant a unit investment trust (UIT)? (Y/N). Y
[If answer is "Y" (Yes) complete only items 111 through 132.]
7. A. Is Registrant a series or multiple portfolio company? (Y/N) N
[If answer is "N" (No), go to item 8.]
B. How many separate series or portfolios did Registrant have at the
end of the period?____________
SCREEN NUMBER: 01 PAGE NUMBER: 01 SEC2100 (S/90)
<PAGE>
For period ending 12/31/1998 If fling more then one
File number 811-08311 Page 2, "X" box: __
C. List the name of each series or portfolio and give a consecutive number to
each series or portfolio starting with the number 1. USE THIS SAME
NUMERICAL DESIGNATION FOR EACH SERIES OR PORTFOLIO IN THE SERIES INFORMATION
BLOCK IN THE TOP RIGHT CORNER OF THE SCREENS SUBMITTED IN THIS FILING AND IN
ALL SUBSEQUENT FILINGS ON THIS FORM. THIS INFORMATION IS REQUIRED EACH TIME
THE FORM IS FILED.
Is this the
Series last fling
Number Series Name for this series?
- ------ ----------- ----------------
1 (Y/N)
(NOTE: See item D(8) of the general instructions to the form for information on
how to complete the form for series companies.)
SCREEN NUMBER: 02 PACE NUMBER: 02 SEC2100 (5/90)
<PAGE>
For period ending 12/3l/1998 If filing more than one
File number 811-08311 Page 47, "X" box:___
UNIT INVESTMENT TRUSTS
111. A. ** Depositor Name:AMERICAN UNITED LIFE INSURANCE COMPANY
B. ** File Number (If any):______________
C. ** City:INDIANAPOLIS State: INDIANA Zip Code:46206
Zip Ext.:0368
** Foreign Country:____________ Foreign Postal Code:_________
111. A. ** Depositor Name:___________________________________________
B. ** File Number (If any):______________
C. ** City:_______ State: __________Zip Code:____ Zip Ext.:_____
** Foreign Country:____________ Foreign Postal Code:_________
112. A. ** Sponsor Name:AMERICAN UNITED LIFE INSURANCE COMPANY
B. ** File Number (If any):______________
C. ** City:INDIANAPOLIS State: INDIANA Zip Code:46206
Zip Ext.:0368
** Foreign Country:____________ Foreign Postal Code:_________
112. A. ** Sponsor Name:_____________________________________________
B. ** File Number (If any):______________
C. ** City:_______ State: __________Zip Code:____ Zip Ext.:_____
** Foreign Country:____________ Foreign Postal Code:_________
SCREEN NUMBER: 55 PAGE NUMBER: 47 SEC2100 (5/90)
<PAGE>
For period ending 12/31/1998 If filing more than one
File number 811-08311 Page 48, "X" box: __
111. A.** Trustee Name:________________________________________________________
B.** City__________ State: __________ Zip Code:_______ Zip Ext.:________
** Foreign Country:____________________ Foreign Postal Code:____________
113. A.** Trustee Name:________________________________________________________
B.** City__________ State: __________ Zip Code:_______ Zip Ext.:________
** Foreign Country:____________________ Foreign Postal Code:____________
114. A.** Principal Underwriter Name: AMERICAN UNITED LIFE INSURANCE COMPANY
B.** File Number: 8-_____________________________________________________
C.** City:INDIANAPOLIS State:INDIANA Zip Code:46206 Zip Ext.:0368
** Foreign Country: __________________ Foreign Postal Code:___________
114. A.** Principal Underwriter Name:_________________________________________
B.** File Number: 8-_____________________________________________________
C.** City:___________ State:____________ Zip Code:________ Zip Ext.:_____
** Foreign Country: __________________ Foreign Postal Code:___________
115. A.** Independent Public Accountant Name:PRICEWATERHOUSECOOPERS, LLP
B.** City:INDIANAPOLIS State:INDIANA Zip Code:46206 Zip Ext.:________
** Foreign Country:____________________ Foreign Postal Code:____________
115. A.** Independent Public Accountant Name:
B.** City__________ State: __________ Zip Code:_______ Zip Ext.:________
** Foreign Country:____________________ Foreign Postal Code:____________
SCREEN NUMBER: 56 PAGE NUMBER:48 SEC2100(5/90)
<PAGE>
For period ending 12/31/1998 If filing more than one
File number 811-08311 Page 49, "X" box: __
116. Family of investment companies information:
A.** Is Registrant part of a family of investment companies? (Y/N)____N____
(Y/N)
B.** Identify the family in 10 letters:__ __ __ __ __ __ __ __ __ __
(NOTE: In filing this form, use this identification
consistently for all investment companies in family. This
designation is for purposes of this form only.)
117. A.** Is Registrant a separate account of an insurance company?(Y/N)___N___
(Y/N)
If answer is "Y" (Yes), are any of the following types of contracts
funded by the Registrant?:
B.** Variable annuity contracts? (Y/N)_________________________N__________
(Y/N)
C.** Scheduled premium variable life contracts? (Y/N)__________Y__________
(Y/N)
D.** Flexible premium variable life contracts? (Y/N)___________Y__________
(Y/N)
E.** Other types of insurance products registered under the
Securities Act of 1933.___________________________________N__________
(Y/N)
118.** State the number of series existing at the end of the period that had
securities registered under the Securities Act of 1933 _____1_________
119.** State the number of new series for which registration statements under
the Securities Act of 1933 became effective during the period___1_______
120.** State the total value of the portfolio securities on the date of deposit
for the new series included in item 119 ($000's omitted)____ $_0________
121.** State the number of series for which a current prospectus was in
existence at the end of the period ______________1_______________________
122.** State the number of existing series for which additional units were
registered under the Securities Act of 1933 during the current period_1_
SCREEN NUMBER: 57 PAGE NUMBER: 49 SEC2100(5/90)
<PAGE>
For period ending 12/31/1998 If filing more than one
File number 811-08311 Page 50 "X" box: __
123.** State the total value of the additional units considered in answering
item 122 ($000's omitted) _______________________________ $_____0________
124.** State the total value of units of prior series that were placed in the
portfolios of subsequent series during the current period (the value
of these units is to be measured on the date they were placed in the
subsequent series)($000'S omitted) ______________________ $______0______
125.** State the total dollar amount of sales loads collected (before
reallowances to other brokers or dealers) by Registrant's principal
underwriter and any underwriter which is an affiliated person of the
principal underwriter during the current period solely from the
sale of units of all series of Registrant ($000's omitted).
$___0________
126. Of the amount shown in item 125 state the total dollar amount of sales
loads collected from secondary market operations in Registrant's units
(include the sales loads, if any, collected on units of a prior series
placed in the portfolio of a subsequent series.) ($000's omitted).
$____0______
127. List opposite the appropriate description below the number of series whose
portfolios are invested primarily (based upon a percentage of NAV) in each
type of security shown, the aggregate total assets at market value as of a
date at or near the end of the current period of each such group of
series and the total income distributions made by each such group of
series during the current period(excluding distributions of realized gains,
if any):
<TABLE>
<S> <C> <C> <C>
Number of Total AssetsTotal Income
Series $000's Distributions
Investing omitted 000s omitted
A.U.S. Treasury direct issue _____________ ______ $________ $___________
B.U.S Government agency ___________________ ______ $________ $___________
C.State and municipal tax-free_____________ ______ $________ $___________
D.Public utility debt _____________________ ______ $________ $___________
E.Brokers or dealers debt or debt of
brokers' or dealers' parent _____________ ______ $________ $___________
F.All other corporate intermed. & long-
term debt _______________________________ ______ $________ $___________
G.All other corporate short-term debt _____ ______ $________ $___________
H.Equity securities of brokers or dealers
or parents of brokers or dealers_________ ______ $________ $___________
I.Investment company equity securities_____ 1 $ 2,951 $___________
J.All other equity securities______________ ______ $________ $___________
K.Other securities_________________________ ______ $________ $___________
L.Total assets of all series of registrant_ ______ $ 2,951 $___________
</TABLE>
SCREEN NUMBER: 58 PAGE NUMBER: 50 SEC2100(5/90)
<PAGE>
For period ending 12/31/1998 If filing more than one
File number 811-8536 Page 51, "X" box: __
128.** Is the timely payment of principal and interest on any of the portfolio
securities held by any of Registrant's series at the end of the
current period insured or guaranteed by an entity other than the issuer?
(Y/N)______N___________
[If answer is "N" (No), go to item 131.] Y/N
129.** Is the issuer of any instrument covered in item 128 delinquent or in
default as to payment of principal or interest at the end of the current
period?(Y/N)____________________________________________________________
[If answer is "N" (No), go to item 131.] Y/N
130.** In computations of NAV or offering price per unit, is any part of the
value attributed to instruments identified in item 129 derived from
insurance or guarantees? (Y/N)__________________________________________
Y/N
131. Total expenses incurred by all series of Registrant during the current
reporting period ($000's omitted) ________121______________
132.** List the "811" (Investment Company Act of 1940) registration number for
all Series of Registrant that are being included in this filing:
811-08311 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
811-____ 811-_____ 811-_____ 811-____ 811-____
SCREEN NUMBER: 59 PAGE NUMBER: 51 SEC2100 (5/90)
<PAGE>
This report is signed on behalf of the registrant in the City of Indianapolis,
State of Indiana, on the 18th day of February, 1999.
AUL AMERICAN INDIVIDUAL UNIT TRUST
(Name of Registrant)
by:\s\ James W. Murphy witness: \s\ Richard A. Wacker
___________________ _____________________
James W. Murphy Richard A. Wacker
Chairman of the Board of Secretary to the Board of
Directors and President, Directors,
AUL American Series Fund AUL American Series Fund
Annual Report
AUL American Individual
Variable Life Unit Trust
December 31, 1998
This report and the financial statements contained herein are for the general
information of the Participants. The report is not to be distributed to
prospective investors as sales literature unless accompanied or preceded by an
effective prospectus of AUL American Series Fund, Inc. and AUL American Unit
Trust, which contains further information concerning the sales charge, expenses
and other pertinent information.
Cover
<PAGE>
A Message
From
The Chairman of the Board
and President of
AUL American Series Fund, Inc
To Participants in AUL American Individual Variable Life Unit Trust
The current economic expansion has been particularly impressive and is now
entering its eighth year, setting a new record as the longest period of
peacetime growth. This expansion has been unique in that it has been accompanied
by low inflation, low interest rates and low unemployment. At the same time,
positive consumer confidence has translated into greater consumer spending and
strong corporate profits have resulted in increased capital spending, both major
drivers to economic growth. However, the playing field changed dramatically
during the third quarter of 1998 when financial difficulties in Russia, Asia and
Latin America and losses incurred by several well-known hedge funds caused a
great deal of concern. In addition, the capital markets had to contend with a
possible credit crunch, increased antagonism with Iraq, and the threat of
political instability here at home.
The stock market experienced a marked downturn during the third quarter in
response to these concerns. To help alleviate market stress, the Federal Reserve
Board intervened on three occasions by cutting the federal funds rate a total of
75 basis points (0 75%). The Fed's actions, coupled with an easing of the global
concerns, provided renewed vigor for the stock market during the last three
months of the year.
Treasury yields declined sharply in the second half of the year as investors
around the world sought the safety and liquidity of U S government-backed,
dollar denominated securities. Yield declines for corporate bonds and
mortgage-backed securities, however, were much smaller. Investors were
particularly leery of smaller, less liquid bond issues, especially those backed
by lower quality credits.
At the present time, most economists are expecting U S economic growth to
decelerate in 1999. The slowdown in foreign economies has led to a decline in
demand for American-made products which results in a contraction in U S exports.
Generally, economists are also expecting consumer spending to ease and the level
of corporate fixed investments to decline. In such an environment, it will be
difficult for the stock market to achieve above average returns in the coming
year.
/S/James W. Murphy
James W Murphy
Chairman of the Board of Directors and President
Indianapolis, Indiana
January 28,1999
1
<PAGE>
(This page is intentionally blank)
2
<PAGE>
Report of Independent Accountants
The Contract Owners of
AUL American Individual Variable Life Unit Trust and
Board of Directors of
American United Life Insurance Company
In our opinion, the accompanying statements of net assets, and the related
statements of operations and of changes in net assets present fairly, in all
material respects, the financial position of AUL American Individual Variable
Life Unit Trust at December 31, 1998, the results of its operations and changes
in its net assets from April 30, 1998 (commencement of operations) to December
31, 1998, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at
December 31, 1998, by correspondence with the custodian, provide a reasonable
basis for the opinion expressed above.
/S/PricewaterhouseCoopers, LLP
Indianapolis, Indiana
February 1, 1999
3
<PAGE>
AUL American Individual Variable Life Unit Trust
Statements of Net Assets
December 31, 1998
AUL American Series Fund Fidelity
------------------------------------------------------ -----------
Equity Money Mkt Bond Managed High Inc Growth
---------- ---------- ---------- ---------- ---------- -----------
Assets:
Investments
at value $ 95,619 $ 131,005 $ 35,741 $ 29,192 $ 26,502 $ 129,171
Net Assets $ 95,619 $ 131,005 $ 35,741 $ 29,192 $ 26,502 $ 129,171
Units
outstanding 19,810 126,861 6,732 5,802 5,852 21,289
Accumulation
Unit Value $ 4.83 $ 1.03 $ 5.31 $ 5.03 $ 4.53 $ 6.07
Fidelity
------------------------------------------------------------------
Overseas Asset Mgr Index 500 Eqty-Inc Contra Money Mkt
---------- ---------- ---------- ---------- ---------- -----------
Assets:
Investments
at value $ 12,832 $ 130,912 $1,417,686 $ 157,771 $ 166,167 $ 25,077
Net Assets $ 12,832 $ 130,912 $1,417,686 $ 157,771 $ 166,167 $ 25,077
Units
outstanding 2,668 24,524 253,822 31,405 29,004 24,203
Accumulation
Unit Value $ 4.81 $ 5.34 $ 5.59 $ 5.02 $ 5.73 $ 1.04
The accompanying notes are an integral part of the financial statements
5
<PAGE>
AUL American Individual Variable Life Unit Trust
Statements of Net Assets (continued)
December 31, 1998
American Century Alger T. Rowe Price
----------------------- --------- --------------
VP Capital VP American
Appreciation Int'l Growth Equity Income
------------ ---------- ----------- -------------
Assets:
Investments
at value $ 4,488 $ 84,292 $ 272,792 $ 231,753
Net Assets $ 4,488 $ 84,292 $ 272,792 $ 231,753
Units
outstanding 986 16,998 43,283 46,062
Accumulation
Unit Value $ 4.55 $ 4.96 $ 6.30 $ 5.03
The accompanying notes are an integral part of the financial statements
6
<PAGE>
AUL American Individual Variable Life Unit Trust
Statements of Operations and Changes in Net Assets
for the period from 4/30/1998 (commencement of operations) through 12/31/1998
AUL American Series Fund Fidelity
------------------------------------------- ----------------------
Equity Money Mkt Bond Managed High Inc Growth
---------- ---------- ---------- ---------- ---------- -----------
Operations:
Dividend
income $ 8,675 $ 1,077 $ 1,028 $ 1,892 $ 0 $ 0
Net Investment
income 8,675 1,077 1,028 1,892 0 0
Gain (Loss) on Investments:
Net realized
gain (loss) (230) 0 390 75 (295) 318
Net change in
unrealized appreciation
(depreciation) 911 0 (649) 608 1,954 17,221
Net Gain (Loss) 681 0 (259) 683 1,659 17,539
Increase
in Net Assets
from Operations 9,356 1,077 769 2,575 1,659 17,539
Contract Owner Transactions:
Proceeds from
units sold 116,012 235,711 140,768 30,838 27,265 118,862
Cost of units
redeemed (26,360) (99,765) (104,420) (2,548) (257) (106)
Account charges (3,389) (6,018) (1,376) (1,673) (2,165) (7,124)
Increase 86,263 129,928 34,972 26,617 24,843 111,632
Net increase 95,619 131,005 35,741 29,192 26,502 129,171
Net Assets,
beginning 0 0 0 0 0 0
Net Assets,
ending $ 95,619 $ 131,005 $ 35,741 $ 29,192 $ 26,502 $ 129,171
========= ========= ========= ========= ========= ==========
Units sold 26,537 229,979 26,926 6,673 6,401 22,644
Units redeemed (6,727) (103,118) (20,194) (871) (549) (1,355)
Net increase 19,810 126,861 6,732 5,802 5,852 21,289
Units outstanding,
beginning 0 0 0 0 0 0
Units outstanding,
ending 19,810 126,861 6,732 5,802 5,852 21,289
========= ========= ========= ========= ========= =========
The accompanying notes are an integral part of the financial statements
7
<PAGE>
AUL American Individual Variable Life Unit Trust
Statements of Operations and Changes in Net Assets (continued)
for the period from 4/30/1998 (commencement of operations) through 12/31/1998
Fidelity
------------------------------------------------------------------
Overseas Asset Mgr Index 500 Eqty-Inc Contra Money Mkt
---------- ---------- ---------- ---------- ---------- -----------
Operations:
Dividend
Income $ 0 $ 0 $ 0 $ 0 $ 0 $ 109
Net Investment
income 0 0 0 0 0 109
Gain (Loss) on Investments:
Net realized
gain (loss) 97 (108) 5,321 382 201 0
Net change in
unrealized appreciation
(depreciation) 704 9,675 133,825 15,629 22,720 0
Net Gain (Loss) 801 9,567 139,146 16,011 22,921 0
Increase
in Net Assets
from Operations 801 9,567 139,146 16,011 22,921 109
Contract Owner Transactions:
Proceeds from
units sold 13,531 130,304 1,314,494 152,705 175,608 40,979
Cost of units
redeemed (60) (2,218) (1,971) (2,283) (20,791) (14,744)
Account charges (1,440) (6,741) (33,983) (8,662) (11,571) (1,267)
Increase 12,031 121,345 1,278,540 141,760 143,246 24,968
Net increase 12,832 130,912 1,417,686 157,771 166,167 25,077
Net Assets,
beginning 0 0 0 0 0 0
Net Assets,
ending $ 12,832 $ 130,912 $1,417,686 $ 157,771 $ 166,167 $ 25,077
========= ========= ========= ========= ========= ==========
Units sold 2,998 26,314 260,809 33,752 35,686 39,905
Units redeemed (330) (1,790) (6,987) (2,347) (6,682) (15,702)
Net increase 2,668 24,524 253,822 31,405 29,004 24,203
Units outstanding,
beginning 0 0 0 0 0 0
Units outstanding,
ending 2,668 24,524 253,822 31,405 29,004 24,203
========= ========= ========= ========= ========= ==========
The accompanying notes are an integral part of the financial statements
8
<PAGE>
AUL American Individual Variable Life Unit Trust
Statements of Operations and Changes in Net Assets (continued)
for the period from 4/30/1998 (commencement of operations) through 12/31/1998
American Century Alger T Rowe Price
--------------------- --------- ------------
VP Capital VP American
Appreciation Int'l Growth Eqty inc
Operations:
Dividend
income $ 0 $ 0 $ 0 $ 7,760
Net Investment
income 0 0 0 7,760
Gain (Loss) on Investments:
Net realized
gain (loss) (18) (2,322) 602 59
Net change in
unrealized appreciation
(depreciation) 595 6,162 43,233 7,033
Net Gain (Loss) 577 3,840 43,835 7,092
Increase
in Net Assets
from Operations 577 3,840 43,835 14,852
Contract Owner Transactions:
Proceeds from
units sold 5,709 111,903 248,390 245,481
Cost of units
redeemed 0 (25,776) (2,128) (17,564)
Account charges (1,798) (5,675) (17,305) (11,016)
Increase 3,911 80,452 228,957 216,901
Net increase 4,488 84,292 272,792 231,753
Net Assets,
beginning 0 0 0 0
Net Assets,
ending $ 4,488 $ 84,292 $ 272,792 $ 231,753
========= ========= ========= ==========
Units sold 1,437 24,233 46,809 52,124
Units redeemed (451) (7,235) (3,526) (6,062)
Net increase 986 16,998 43,283 46,062
Units outstanding,
beginning 0 0 0 0
Units outstanding,
ending 986 16,998 43,283 46,062
======== ======== ======== =========
The accompanying notes are an integral part of the financial statements
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
The AUL American Individual Variable Life Unit Trust (Variable Account) was
established by American United Life Insurance Company (AUL) on July 10, 1997,
under procedures established by Indiana law and is registered as a unit
investment trust under the Investment Company Act of 1940, as amended. The
Variable Account commenced operations on April 30, 1998. The Variable Account is
a segregated investment account for individual variable life insurance contracts
issued by AUL and invests exclusively in shares of mutual fund portfolios
offered by the AUL American Series Fund, Inc (AUL American Series Fund),
Fidelity Variable Insurance Products Fund and Fidelity Variable Insurance
Products Fund II(Fidelity), American Century Variable Portfolios, Inc (American
Century), Alger American Fund (Alger), and T Rowe Price Equity Series, Inc (T
Rowe Price).
Security Valuation Transactions and Related Income
The market value of investments is based on the closing bid prices at December
31, 1998 Investment transactions are accounted for on the trade date and
dividend income is recorded on the ex-dividend date.
Taxes
Operations of the Variable Account are part of, and are taxed with, the
operations of AUL, which is taxed as a "life insurance company" under the
Internal Revenue Code. Under current law, investment income, including realized
and unrealized capital gains of the investment accounts, is not taxed to AUL to
the extent it is applied to increase reserves under the contracts. The Variable
Account has not been charged for federal and state income taxes since none have
been imposed.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates
2. Account Charges
With respect to variable life insurance policies funded by the variable account,
AUL makes certain deductions as follows:
Modified Single Premium Policy: AUL assesses (1) cost of insurance charges, (2)
monthly administrative charges not to exceed 0.40% of the account value on an
annual basis, (3) mortality and expense risk charges of 0.90% per year for the
first 10 policy years and 0.80% per year thereafter, (4) a premium tax charge
equal to 0.25% of the account value annually for the first 10 policy years, (5)
federal tax charges equal to 0.15% of the account value each year for the first
10 years, (6) an annual contract charge of $30.00 each year in which an
individual policy's account value does not exceed a specific amount, and (7) in
the event of a surrender, a surrender charge of 10% reducing to 0% of premium
surrender, depending upon policy duration The cost of additional policy riders
is assessed on a monthly basis and will vary depending upon the riders chosen.
Flexible Premium Adjustable Policy: AUL assesses (1) cost of insurance charges,
(2) monthly administrative charges of $30.00 per month in the first year and
$5.00 per month thereafter, (3) mortality and expense risk charges of 0.75% per
year for the first 10 policy years and 0.25% thereafter, (4) premium tax charges
equal to 0.25% of the account value annually for the first 10 years the policy
is in force, (5) an annual contract charge of $30.00 each year in which an
individual policy's account value does not exceed a specific amount, and (6) in
the event of a surrender, 100% of premium for the first five contract years,
reduced by 10% each year for contract years 6 through 15 The cost of additional
policy riders is assessed on a monthly basis and will vary depending upon the
riders chosen.
10
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
3. Accumulation Unit Value
The change in the Accumulation Unit Value per unit for the period from April 30,
1998 through December 31, 1998 is:
12/31/98 4/30/98 Change
-------- ------- ------
AUL American Series Fund:
Equity $ 4.826818 $ 5.000000 -3.5%
Money Market 1.032790 1.000000 3.3%
Bond 5 309238 5.000000 6.2%
Managed 5 031288 5.000000 0.6%
Fidelity:
High Income 4.528671 5.000000 -9.4%
Growth 6.065156 5.000000 21.3%
Overseas 4.808152 5.000000 -3.8%
Asset Manager 5.338035 5.000000 6.8%
Index 500 5.585215 5.000000 11.7%
Equity Income 5.023715 5.000000 0.5%
Contrafund 5.729026 5.000000 14.6%
MoneyMarket 1.036145 1.000000 3.6%
American Century:
VP Capital
Appreciation 4.550963 5.000000 -9.0%
VP International 4.958841 5.000000 -0.8%
Alger:
American Growth 6.302550 5.000000 26.1%
T Rowe Price:
Equity Income 5.031378 5.000000 0.6%
4. Cost of Investments
The cost of investments at December 31, 1998, is:
AUL American Series Fund:
Equity $ 94,708
Money Market 131,005
Bond 36,391
Managed 28,584
Fidelity:
High Income 24,548
Growth 111,950
Overseas 12,128
Asset Manager 121,237
Index 500 1,283,862
Equity Income 142,142
Contrafund 143,447
Money Market 24,998
American Century:
VP Capital
Appreciation 3,893
VP International 78,130
Alger:
American Growth 229,560
T Rowe Price:
Equity Income 224,720
11
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
5. Net Assets
Net Assets at December 31, 1998, are:
AUL American Series Fund Fidelity
------------------------------------------- -----------
Equity Mon Mkt Bond Managed High Inc
---------- ---------- ---------- ---------- -----------
Proceeds from
units sold $ 116,012 $ 235,711 $ 140,768 $ 30,838 $ 27,265
Cost of
units redeemed (26,360) (99,765) (104,420) (2,548) (257)
Account charges (3,389) (6,018) (1,376) (1,673) (2,165)
Net investment
income 8,675 1,077 1,028 1,892 0
Net realized
gain (loss) (230) 0 390 75 (295)
Unrealized appreciation
(depreciation) 911 0 (649) 608 1,954
$ 95,619 $ 131,005 $ 35,741 $ 29,192 $ 26,502
========== ========== ========== ========== ===========
Fidelity
-------------------------------------------------------
Growth Overseas Asset Mgr Index 500 Eqty-inc
---------- ---------- ---------- ---------- -----------
Proceeds from
units sold $ 118,862 $ 13,531 $ 130,304 $1,314,494 $ 152,705
Cost of
units redeemed (106) (60) (2,218) (1,971) (2,283)
Account charges (7,124) (1,440) (6,741) (33,983) (8,662)
Net investment
income 0 0 0 0 0
Net realized
gain (loss) 318 97 (108) 5,321 382
Unrealized appreciation
(depreciation) 17,221 704 9,675 133,825 15,629
$ 129,171 $ 12,832 $ 130,912 $1,417,686 $ 157,771
========== ========== ========== ========== ===========
Fidelity American Century Alger
--------------------- -------------------- ----------
VP Capital VP American
Contrafund Mon Mkt Apprec. Int'l Growth
---------- --------- --------- ---------- ----------
Proceeds from
units sold $ 175,608 $ 40,979 $ 5,709 $ 111,903 $ 248,390
Cost of
units redeemed (20,791) (14,744) 0 (25,776) (2,128)
Account charges (11,571) (1,267) (1,798) (5,675) (17,305)
Net investment
income 0 109 0 0 0
Net realized
gain (loss) 201 0 (18) (2,322) 602
Unrealized appreciation
(depreciation) 22,720 0 595 6,162 43,233
$ 166,167 $ 25,077 $ 4,488 $ 84,292 $ 272,792
========== ========== ========== ========== ===========
T Rowe Price
------------
Equity income
Proceeds from
units sold $ 245,481
Cost of units
redeemed (17,564)
Account charges (11,016)
Net investment
income 7,760
Net realized
gain (loss) 59
Unrealized appreciation
(depreciation) 7,033
$ 231,753
==========
12
<PAGE>
AUL
American United Life Insurance Company
One American Square
P. O. Box 368
Indianapolis, Indiana 46206-0368
www.aul.com
Back Cover
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