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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-17f-2
Certificate of Accounting of Securities and Similar
Investments in the Custody of
Management Investment Companies
Pursuant to Rule 17f-2 [17 CFR 270.17f-2]
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1. Investment Company Act File Number: Date ex
811-8979 6-9-00
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2. State identification Number:
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AL AK AZ AR
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CT DE DC FL
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ID IL IN IA
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LA ME MD MA
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MS MO MT NE
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NJ NM NY NC
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OK OR PA RI
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TN TX UT VT
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WV WI WY PUERTO RICO
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Other (specify):
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3. Exact name of investment company as specified in representation statement:
The Victory Variable Insurance Funds
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5. Address of principal executive office (number, street, city, state, zip
code):
BISYS FUND SERVICES, 3435 STELZER ROAD, COLUMBUS, OHIO 43219-8001
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INSTRUCTIONS
This form must be completed by investment companies that have custody of
securities or similar investments.
Accountant
3. Submit this Form to the Securities and Exchange Commission and appropriate
state securities administrators when filing the certificate of accounting
required by Rule 17f-2 under the Act and applicable state law. File the
original and one copy with the Securities and Exchange Commission's
principal office in Washington, D.C., one copy with the regional office for
the region in which the investment company's principal business operations
are conducted, and one copy with the appropriate state administrator(s), if
applicable.
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[LETTERHEAD OF PRICEWATERHOUSECOOPERS]
Report of Independent Accountants
To the Trustees of
The Victory Variable Insurance Funds:
We have examined management's assertion, included in the accompanying Management
Statement Regarding Compliance with Certain Provisions of the Investment Company
Act of 1940, about The Victory Variable Insurance Funds' (constituting The
Victory Variable Investment Quality Bond Fund, The Victory Variable Investment
Diversified Stock Fund, and The Victory Variable Investment Small Company
Opportunity Fund) compliance with the requirements of subsections (b) and (c) of
Rule 17f-2 under the Investment Company Act of 1940 ("the Act") as of June 9,
2000. Management is responsible for The Victory Variable Insurance Funds'
compliance with those requirements. Our responsibility is to express an opinion
on management's assertion about The Victory Variable Insurance Funds' compliance
based on our examination.
Our examination was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants and,
accordingly, included examining, on a test basis, evidence about The Victory
Variable Insurance Funds' compliance with those requirements and performing such
other procedures as we considered necessary in the circumstances. Included
among our procedures were the following tests performed as of June 9, 2000, and
with respect to agreement of security purchases and sales, for the period from
October 31, 1999 (the date of our last examination), through June 9, 2000:
- Count and inspection of all securities located in the vault of Key Trust
Company of Ohio, N.A. in Cleveland, Ohio, without prior notice to
management;
- Confirmation of all securities held by institutions in book entry form the
Federal Reserve Bank of Cleveland, the Depository Trust Company, or Bank of
New York;
- Confirmation of all securities out for transfer with brokers;
- Reconciliation of all such securities to the books and records of The
Victory Variable Insurance Funds and the Custodian;
We believe that our examination provided a reasonable basis for our opinion. Our
examination does not provide a legal determination on The Victory Variable
Insurance Funds' compliance with specified requirements.
In our opinion, management's assertion that The Victory Variable Insurance Funds
were in compliance with the requirements of subsections (b) and (c) of Rule
17f-2 of the Investment Company Act of 1940 as of June 9, 2000, with respect to
securities reflected in the investment account of The Victory Variable Insurance
Funds are fairly stated, in all material respects.
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[LOGO]
This report is intended solely for the information and use of the Trustees,
management, and the Securities and Exchange Commission and is not intended to be
and should not be used by anyone other than these specified parties.
/s/PriceWaterhouseCoopers LLP
August 23, 2000
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Management Statement Regarding Compliance with Certain Provisions of the
Investment Company Act of 1940
We, as members of management of The Victory Variable Insurance Funds
(constituting The Victory Variable Investment Quality Bond Fund, The Victory
Variable Investment Diversified Stock Fund, and The Victory Variable Investment
Small Company Opportunity Fund), are responsible for complying with the
requirements of subsections (b) and (c) of Rule 17f-2, Custody of Investments by
Registered Management Investment Companies, of the Investment Company Act of
1940. We are also responsible for establishing and maintaining effective
internal controls over compliance with those requirements. We have performed an
evaluation of The Victory Variable Insurance Funds' compliance with the
requirements of subsections (b) and (c) of Rule 17f-2 as of June 9, 2000, and
from October 31, 1999 through June 9, 2000.
Based on this evaluation, we assert that The Victory Variable Insurance Funds
were in compliance with the requirements of subsections (b) and (c) of Rule
17f-2 of the Investment Company Act of 1940 as of June 9, 2000, and from October
31, 1999, through June 9, 2000, with respect to securities reflected in the
investment account of The Victory Variable Insurance Funds.
The Victory Variable Funds.
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