<PAGE> 1
Semi-Annual Report
STAGECOACH VARIABLE ANNUITIES
June 30, 2000
Stagecoach Variable Annuity(TM)
Stagecoach Variable Annuity Plus(TM)
Stagecoach Extra Credit Variable Annuity(TM)
Stagecoach Variable Annuity Flex(TM)
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
Letter to Contract Holders.................................. 2
Wells Fargo Variable Trust Financial Statements............. 3
American Skandia Trust Financial Statements................. 91
Alger American Fund Financial Statements.................... 171
Montgomery Variable Series.................................. 185
Invesco Variable Fund....................................... 201
</TABLE>
This report has been prepared to provide information to owners of American
Skandia Life Assurance Corporation's Stagecoach Variable Annuity, Stagecoach
Variable Annuity Plus, Stagecoach Extra Credit Variable Annuity and Stagecoach
Variable Annuity Flex. If it is used for any other purpose, it must be
accompanied or preceded by a current prospectus, as applicable, which discloses
any charges and other important information about the Account, together with the
current applicable prospectus for the Wells Fargo Variable Trust, the American
Skandia Trust, the Alger American Fund, the Montgomery Variable Series and the
Invesco Variable Fund.
The financial statements for the sub-accounts that invest in Portfolios of
American Skandia Trust reflect financial activity for the Stagecoach Variable
Annuities and other products that use the same sub-accounts.
VARIABLE ANNUITIES:
---------------------------------------------------------------------
- are NOT insured by the FDIC or U.S. Government
- are NOT obligations or deposits of Wells Fargo Bank nor guaranteed by the
Bank
- involve investment risk, including possible loss of principal [NO FDIC LOGO]
1
<PAGE> 3
STAGECOACH VARIABLE ANNUITY
STAGECOACH VARIABLE ANNUITY PLUS
STAGECOACH EXTRA CREDIT VARIABLE ANNUITY
STAGECOACH VARIABLE ANNUITY FLEX
SEMI-ANNUAL REPORT
August 28, 2000
Dear Investor:
The first half of 2000 has certainly challenged the fortitude of the investing
industry. But as every investor knows, the focus is on the marathon, not the
sprint. A stock market correction in the first half of this year does not
necessarily signal the beginning of the end of a long bull market wave of
prosperity.
When American Skandia witnesses volatility like we've seen this year, we feel
extremely confident with our investment management discipline because of the way
it has been structured. The process provides our investors with the broadest and
most diversified array of world-class portfolio managers in the variable annuity
industry. Our line-up of 48 different sub-accounts offers complete coverage of
the major investment styles as well as international, index, and specialty
equity options.
We believe that the investment managers we have in place today offer you and
your financial professionals the best names, no matter what your investment
discipline might be. We strive to provide you, the investor, with some of the
top names in all asset classes.
In addition, we continually monitor the current fund offerings for performance
and are always looking to provide you, the investor, with new investment
opportunities through your financial professionals.
Our goal is to relentlessly stay the course in driving performance to even
higher levels and continuing our thriving relationship with you and your
financial professional. We hope that you continue to make use of this successful
collaboration in your future financial planning offerings.
Sincerely,
/s/ Wade Dokken
Wade Dokken
Chief Operating Officer
American Skandia
2
<PAGE> 4
WELLS FARGO VARIABLE TRUST
SEMI-ANNUAL REPORT
JUNE 30, 2000
ASSET ALLOCATION FUND
CORPORATE BOND FUND
EQUITY INCOME FUND
EQUITY VALUE FUND
GROWTH FUND
LARGE COMPANY GROWTH FUND
MONEY MARKET FUND
SMALL CAP GROWTH FUND
3
<PAGE> 5
VARIABLE TRUST ASSET ALLOCATION FUND
INVESTMENT OBJECTIVE
The Variable Trust Asset Allocation Fund (the Fund) seeks long-term total
return, consistent with reasonable risk.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Barclays Global Fund Advisors, N.A.
FUND MANAGERS
Team managed
INCEPTION DATE
04/15/94
PERFORMANCE HIGHLIGHTS
The Fund returned 4.04%(1) for the six-month period ended June 30, 2000.
The Fund's benchmark is allocated 60% S&P 500 Index(2), which returned (0.42)%
during the period, and 40% Lehman Brothers Treasury 20+ Year Index(3), which
returned 10.01%, for a combined benchmark return of 3.75% for the period. The
Fund distributed $0.17 per share in dividend income and no capital gains during
the period. Please keep in mind that past performance is no guarantee of future
results.
Equity markets stumbled early in the year on news of impending interest
rate increases designed to slow the nation's fast-growing economy. Large cap
stocks were hardest hit, dragged down by a sell-off in the technology sector. In
contrast, the bond market rallied, with the 30-year U.S. Treasury bond posting a
total return of 9.06% for the second quarter, a significant improvement from a
loss of nearly 15% in 1999. Against this backdrop, the Fund increased its bond
holdings to capture gains in the bond market before ending the period at an
allocation of 62% stocks and 38% fixed-income securities.
The second quarter was significantly more volatile, with the Nasdaq
Composite Index(4) falling 25% during the second week of April. The S&P 500
Index also lost ground following a half-point interest rate increase, while
long-term bonds surrendered part of their first quarter gains. Equity and bond
markets rebounded in June when preliminary economic data pointed to signs of an
economic slowdown, yet stocks remained in negative territory at the end of the
second quarter.
STRATEGIC OUTLOOK
A sustained slowdown in economic growth may convince the Federal Reserve
Board to hold off on additional interest rate increases. Stable or falling
interest rates should prove beneficial for both stocks and bonds.
4
<PAGE> 6
VARIABLE TRUST ASSET ALLOCATION FUND(5)
[ASSET ALLOCATION PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
LEHMAN BROTHERS TREASURY 20+
WFVT ASSET ALLOCATION FUND YEAR INDEX S&P 500 INDEX
-------------------------- ---------------------------- -------------
<S> <C> <C> <C>
10000.00 10000.00 10000.00
9940.00 9917.00 10164.00
6/94 9796.00 9815.00 9915.00
10107.00 10178.00 10241.00
10248.00 10078.00 10660.00
9/94 9964.00 9733.00 10400.00
10055.00 9702.00 10633.00
9954.00 9771.00 10246.00
12/94 10113.00 9932.00 10398.00
10384.00 10202.00 10668.00
10707.00 10488.00 11083.00
3/95 10894.00 10588.00 11409.00
11137.00 10778.00 11745.00
11686.00 11667.00 12214.00
6/95 11870.00 11808.00 12497.00
12031.00 11598.00 12911.00
12127.00 11876.00 12944.00
9/95 12438.00 12111.00 13490.00
12514.00 12475.00 13442.00
12860.00 12799.00 14031.00
12/95 13041.00 13168.00 14301.00
13284.00 13152.00 14788.00
13180.00 12455.00 14925.00
3/96 13256.00 12185.00 15068.00
13233.00 11970.00 15290.00
13350.00 11906.00 15683.00
6/96 13531.00 12172.00 15742.00
13223.00 12171.00 15047.00
13199.00 11997.00 15364.00
9/96 13705.00 12347.00 16227.00
14185.00 12864.00 16675.00
14917.00 13324.00 17934.00
12/96 14535.00 12976.00 17579.00
14815.00 12859.00 18678.00
14853.00 12862.00 18824.00
3/97 14323.00 12508.00 18050.00
14904.00 12827.00 19126.00
15406.00 12975.00 20294.00
6/97 15820.00 13246.00 21197.00
16903.00 14096.00 22883.00
16211.00 13660.00 21601.00
9/97 16822.00 14065.00 22783.00
16849.00 14583.00 22022.00
17232.00 14812.00 23041.00
12/97 17569.00 15075.00 23438.00
17833.00 15391.00 23696.00
18624.00 15268.00 25404.00
3/98 19295.00 15299.00 26705.00
19458.00 15350.00 26977.00
19354.00 15675.00 26513.00
6/98 20075.00 16087.00 27590.00
19881.00 15996.00 27297.00
17985.00 16778.00 23353.00
9/98 18996.00 17396.00 24850.00
20090.00 17100.00 26867.00
21065.00 17258.00 28496.00
12/98 22008.00 17218.00 30137.00
22760.00 17382.00 31406.00
21942.00 16453.00 30426.00
3/99 22567.00 16380.00 31643.00
23208.00 16393.00 32867.00
22715.00 16133.00 32092.00
6/99 23349.00 15935.00 33838.00
22838.00 15845.00 32781.00
22723.00 15770.00 32619.00
9/99 22394.00 15884.00 31725.00
23190.00 15886.00 33733.00
23389.00 15765.00 34418.00
12/99 24060.00 15486.00 36445.00
23560.00 15756.00 34615.00
23726.00 16315.00 33961.00
3/00 25436.00 16926.00 37283.00
24882.00 16758.00 36160.00
24463.00 16673.00 35419.00
6/00 25031.00 17036.00 36294.00
</TABLE>
AVERAGE ANNUAL TOTAL RETURN (%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<CAPTION>
SHARE PERFORMANCE
-----------------
<S> <C>
6-Month* 4.04%
1-Year 7.20%
5-Year 16.09%
Since Inception
(04/15/94) 15.93%
</TABLE>
<TABLE>
<CAPTION>
LEHMAN BROTHERS TREASURY 20+
BENCHMARK S&P 500 INDEX YEAR INDEX
--------- ------------- ----------------------------
<S> <C> <C>
6-Month* (0.42)% 10.01%
1-Year 7.25% 6.91%
5-Year 23.80% 7.61%
</TABLE>
* Returns for periods less than one year are not annualized.
5
<PAGE> 7
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 25%
Number of Holdings 528
Weighted Average Maturity of Bond Portfolio 23.8 Years
Estimated Duration of Bond Portfolio 11.7 Years
NAV $14.83
</TABLE>
TEN LARGEST HOLDINGS (AS OF JUNE 30, 2000)(6)
<TABLE>
<CAPTION>
NAME % OF FUND
---- ---------
<S> <C>
UST Bond, 8.00%, 11/15/21 3.77%
UST Bond, 8.75%, 8/15/20 2.76%
UST Bond, 6.25%, 8/15/23 2.75%
UST Bond, 6.125%, 11/15/27 2.66%
General Electric Company 2.60%
Intel Corporation 2.22%
Cisco Systems, Incorporated 2.20%
Microsoft Corporation 2.09%
UST Bill, due 8/30/00 1.87%
UST Bond, 7.625%, 2/15/25 1.83%
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(7)
[PIE CHART]
<TABLE>
<S> <C>
U.S. Treasury Securities 35%
Technology 21%
Financial 9%
Health Care 7%
Energy 4%
Consumer Non-Cyclical 4%
Consumer Cyclical 4%
Telecommunications 4%
Consumer Services 3%
Cash 3%
Basic Materials 2%
Industrials 2%
Utilities 1%
Commercial Services 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
Performance shown for the Wells Fargo Variable Trust Asset Allocation Fund for
periods prior to September 20, 1999, reflects performance of the Life and
Annuity Trust Asset Allocation Fund, its predecessor fund. Effective at the
close of business September 17, 1999, the Life and Annuity Trust and Norwest
Select Funds were reorganized into the Wells Fargo Variable Trust Funds.
6
<PAGE> 8
(2) The S&P 500 Index is an unmanaged index of 500 widely-held common stocks
representing, among others, industrial, financial, utility, and transportation
companies listed or traded on national exchanges or over-the-counter markets.
You cannot invest directly in an index.
(3) The Lehman Brothers Treasury 20+ Year Index is an unmanaged index composed
of securities in the U.S. Treasury Index with maturities of 20 years or greater.
The U.S. Treasury Index represents public obligations of the U.S. Treasury with
a remaining maturity of one year or more. You cannot invest directly in an
index.
(4) The Nasdaq Composite Index is a broad-based capitalization-weighted index of
all Nasdaq National Market & Small-Cap stocks. Your cannot invest directly in an
index.
(5) The chart compares the performance of the Wells Fargo Variable Trust Asset
Allocation Fund since inception with the S&P 500 Index and the Lehman Brothers
Treasury 20+ Year Index. The chart assumes a hypothetical $10,000 investment and
reflects all operating expenses of the Fund. The Fund is a professionally
managed mutual fund.
(6) The Ten Largest Holdings are calculated based on the market value of the
securities divided by total market value of the portfolio.
(7) Portfolio holdings are subject to change.
7
<PAGE> 9
VARIABLE TRUST CORPORATE BOND FUND
INVESTMENT OBJECTIVE
The Variable Trust Corporate Bond Fund (the Fund) seeks a high level of current
income, consistent with reasonable risk.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGERS
N. Graham Allen, FCMA
John W. (Jack) Burgess
Jacqueline A. Flippin
Daniel J. Kokoszka, CFA
Scott Smith, CFA
INCEPTION DATE
09/20/99
PERFORMANCE HIGHLIGHTS
The Fund returned 2.60%(1) for the six-month period ended June 30, 2000,
slightly underperforming its benchmark, the Lehman Brothers U.S. Credit
Index(2), which returned 2.68%. The Fund distributed $0.32 per share in dividend
income and no capital gains during the period. Please keep in mind that past
performance is no guarantee of future results.
The Fund's defensive structure, which reduced its exposure to
investment-grade corporate bonds in favor of U.S. Treasury securities, benefited
the Fund's performance. Investment-grade bonds initially languished as spreads
widened amid the impact of higher interest rates, investors' appetite for risk
diminished, leveraged-buyout risk increased and monetary policy was tight in the
form of interest rate increases. In contrast, rising default rates combined with
shareholder redemptions contributed to the poor performance of the Fund's
high-yield bonds, which represented nearly 15% of the portfolio holdings at the
end of the period.
In an effort to enhance future performance, the Fund completed several
transactions during the period seeking to improve average credit quality, while
further diversifying its holdings to help offset market risk.
STRATEGIC OUTLOOK
Amid mounting evidence of an economic slowdown, the Fund will seek to
opportunistically extend average maturity to capitalize on stable or declining
interest rates. The Fund will also focus on higher quality bonds, particularly
bonds with maturities of less than 10 years, issued by companies with solid
credit fundamentals.
8
<PAGE> 10
VARIABLE TRUST CORPORATE BOND FUND(3)
[CORPORATE BOND FUND PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
LEHMAN BROTHERS U.S. CREDIT LEHMAN BROTHERS CORPORATE
WFVT CORPORATE BOND FUND INDEX LONG BOND INDEX(4)
------------------------ --------------------------- -------------------------
<S> <C> <C> <C>
8/99 10000 10000 10000
9/99 10005 10109 10106
10/99 10060 10155 10168
11/99 10030 10166 10151
12/99 9984 10112 10058
1/00 9958 10076 10039
2/00 10082 10170 10157
3/00 10252 10257 10245
4/00 10059 10166 10084
5/00 10011 10129 9969
6/00 10244 10383 10323
</TABLE>
TOTAL RETURN (%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<S> <C>
1-month 2.32%
3-month (0.08)%
6-month 2.60%
Since Inception
(09/20/99) 3.11%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK LEHMAN BROTHERS U.S. CREDIT INDEX
--------- ---------------------------------
<S> <C>
1-month 2.51%
3-month 1.23%
6-month 2.68%
1-Year 3.00%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK LEHMAN BROTHERS CORPORATE LONG BOND INDEX
--------- -----------------------------------------
<S> <C>
1-month 3.55%
3-month 0.76%
6-month 2.63%
1-Year 1.63%
</TABLE>
9
<PAGE> 11
<TABLE>
<S> <C> <C>
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
Portfolio Turnover 65%
Number of Holdings 200
Average Credit Quality(5) Baa1
NAV $9.75
Distribution Rate(6) 6.59%
SEC Yield(7) 7.02%
</TABLE>
PORTFOLIO ALLOCATION (AS OF JUNE 30, 2000)(8)
[PIE CHART]
<TABLE>
<S> <C>
Corporate Bonds 52%
US. Treasury Bonds 29%
Non Investment-Grade Bonds (BB or lower) 14%
Mortgage-Backed Securities 3%
Foreign Denominated Securities 1%
Repurchase Agreement 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
(2) The Fund changed its benchmark to the Lehman Brothers U.S. Credit Index,
formerly the Lehman Brothers Corporate Index, because it is more representative
of the Fund's average portfolio maturity and holdings. The Lehman Brothers U.S.
Credit Index is an unmanaged index composed of publicly issued U.S. corporate
and specified foreign debentures and secured notes that meet the specified
maturity, liquidity, and quality requirements. To qualify, bonds must be
SEC-registered. The Fund is a professionally managed mutual fund. You cannot
invest directly in an index.
(3) The chart compares the performance of the Wells Fargo Variable Trust
Corporate Bond Fund since inception with the Lehman Brothers U.S. Credit Index.
The chart assumes a hypothetical $10,000 investment and reflects all operating
expenses of the Fund. The Fund is a professionally managed mutual fund.
(4) The Lehman Brothers Corporate Long Bond Index is a total return index of all
publicly-issued, fixed-rate, non-convertible investment grade domestic corporate
bonds and Yankee Bonds. All bonds have maturities of at least 10 years or more.
The returns are weighted by market value including accrued interest. The bonds
represented in this index are subject to investment risk, including loss of
principal, if sold prior to maturity, and also to default. You cannot invest
directly in an index.
(5) The average credit quality is compiled from the ratings of Standard & Poor's
and/or Moody's Investors Service (together "rating agencies"). Standard & Poor's
is a trademark of McGraw-Hill, Inc., and has been licensed. The Fund is not
sponsored, sold or promoted by these rating agencies and these rating agencies
make no representation regarding the advisability of investing in the Fund.
(6) The distribution rate is based on the actual distributions made by the Fund.
The distribution rate is calculated by annualizing the Fund's most recent income
dividend and dividing that figure by the applicable current public offering
price.
(7) The formula used to calculate the SEC yield is described in detail in the
Fund's Statement of Additional Information and is designed to standardize the
yield calculations so that all mutual fund companies with the same or similar
portfolios quote a uniform yield figure for their non-money market
advertisements. SEC yields include the actual amount of interest earned adjusted
by any gain or loss realized due to the return of principal, less expenses and
the maximum offering price calculated on a 30-day month-end basis.
(8) Portfolio holdings are subject to change.
10
<PAGE> 12
VARIABLE TRUST EQUITY INCOME FUND
INVESTMENT OBJECTIVE
The Variable Trust Equity Income Fund (the Fund) seeks long-term capital
appreciation and above-average dividend income.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGERS
David L. Roberts, CFA
Gary J. Dunn, CFA
INCEPTION DATE
05/06/96
PERFORMANCE HIGHLIGHTS
The Fund returned (4.53)%(1) for the six-month period ended June 30, 2000,
underperforming the S&P 500 Index(2), which returned (0.42)% and the Russell
1000 Value Index(3), which returned (4.23)%. The Fund distributed $0.09 per
share in dividend income and no capital gains during the period. Please keep in
mind that past performance is no guarantee of future results.
Fund performance was affected by several factors, including the negative
impact of a strong U.S. dollar on the portfolio's international holdings and
downturns in the communications, basic materials and consumer-related sectors.
Shares of AT&T, one of the Fund's largest holdings, slid in response to profit
warnings, while May Department Stores struggled amid soft retail sales. Target
Corporation also experienced declining share prices, even though the company's
current fundamentals and growth prospects remain solid.
The Fund benefited from its health care, energy and technology holdings.
Pfizer's merger with Warner-Lambert was well received by investors, while the
launch of new products boosted shares of American Home Products. In addition,
Schlumberger enjoyed strong performance thanks to firming prices and capital
spending in the energy sector.
During the period, the Fund eliminated its position in Pacific, Gas &
Electric and added to existing positions in IBM and Lucent Technologies to
increase its technology weighting. Weakness in Honeywell stock also presented
the Fund with an opportunity to add to its current position.
STRATEGIC OUTLOOK
One aspect of the Fund's strategy is to capitalize on the global economic
recovery. Since the Fund has exposure to many U.S. companies that derive
significant revenues from global operations, the Fund should benefit as foreign
economies continue to improve.
11
<PAGE> 13
VARIABLE TRUST EQUITY INCOME FUND(4)
[EQUITY VALUE PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
WFVT EQUITY VALUE FUND RUSSELL 1000 VALUE INDEX S&P 500 INDEX
---------------------- ------------------------ -------------
<S> <C> <C> <C>
10000 10000 10000
9680 9852 9828
6/98 9739 9978 10227
9268 9801 10119
8156 8343 8656
9/98 8626 8822 9211
9199 9506 9959
9460 9949 10563
12/98 9624 10288 11171
9403 10370 11642
9161 10224 11278
3/99 9380 10436 11729
10188 11410 12183
10087 11285 11896
6/99 10399 11612 12543
10024 11272 12151
9477 10854 12091
9/99 8981 10475 11760
9285 11078 12504
9255 10992 12758
12/99 9386 11044 13510
9142 10684 12831
8715 9891 12589
3/00 9498 11097 13820
9284 10968 13404
9416 11084 13129
6/00 9157 10577 13454
</TABLE>
AVERAGE ANNUAL TOTAL RETURN(%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<S> <C>
6-Month* (4.53)%
1-Year (8.64)%
Since Inception (05/06/96) 13.67%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK RUSSELL 1000 VALUE INDEX S&P 500 INDEX
--------- ------------------------ -------------
<S> <C> <C>
6-Month* (4.23)% (0.42)%
1-Year (8.92)% 7.25%
</TABLE>
---------------
*Returns for periods less than one year are not annualized.
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 3%
Number of Holdings 47
NAV $16.23
</TABLE>
12
<PAGE> 14
TEN LARGEST EQUITY HOLDINGS (AS OF JUNE 30, 2000)(5)
<TABLE>
<CAPTION>
NAME % OF FUND
---- ---------
<S> <C>
PepsiCo 4.66%
Hewlett-Packard Company 4.48%
Lucent Technologies, Incorporated 4.13%
General Electric Company 3.58%
IBM Corporation 3.58%
Tyco International Limited 3.57%
Pfizer, Incorporated 3.47%
St. Paul Companies, Incorporated 3.31%
American Home Products 3.05%
Exxon Mobil Corporation 3.01%
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(6)
[PIE CHART]
<TABLE>
<S> <C>
Technology 16%
Financial 15%
Health Care 12%
Consumer Non-Cyclical 10%
Industrials 8%
Basic Materials 8%
Energy 8%
Consumer Cyclical 6%
Consumer Services 5%
Telecommunications 5%
Commercial Services 4%
Utilities 3%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
Performance shown for the Wells Fargo Variable Trust Equity Income Fund for
periods prior to September 20, 1999, reflects performance of the Norwest Select
Income Equity Fund, its predecessor fund. Effective at the close of business
September 17, 1999, the Life and Annuity Trust and Norwest Select Funds were
reorganized into the Wells Fargo Variable Trust Funds.
(2) The S&P 500 Index is an unmanaged index of 500 widely-held common stocks
representing, among others, industrial, financial, utility and transportation
companies listed or traded on national exchanges or over-the-counter markets.
You cannot invest directly in an index.
(3) The Russell 1000 Value Index measures the performance of those Russell 1000
companies with lower price-to-book ratios and lower forecasted growth values.
You cannot invest directly in an index.
(4) The chart compares the performance of the Wells Fargo Variable Trust Equity
Income Fund since inception with the S&P 500 Index and the Russell 1000 Value
Index. The chart assumes a hypothetical $10,000 investment and reflects all
operating expenses of the Fund. The Fund is a professionally managed mutual
fund.
(5) The Ten Largest Equity Holdings are calculated based on the market value of
the securities divided by total market value of the portfolio.
(6) Portfolio holdings are subject to change.
13
<PAGE> 15
VARIABLE TRUST EQUITY VALUE FUND
INVESTMENT OBJECTIVE
The Variable Trust Equity Value Fund (the Fund) seeks long-term capital
appreciation.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGERS
Allen Wisniewski, CFA
Gregg Giboney, CFA
Allan White
INCEPTION DATE
05/01/98
PERFORMANCE HIGHLIGHTS
The Fund returned (2.44)%(1) for the six-month period ended June 30, 2000.
The Fund underperformed the S&P 500 Index(2), which returned (0.42)%, and
outperformed the Russell 1000 Value Index(3), which returned (4.23)%. The Fund
distributed $0.04 per share in dividend income and no capital gains during the
period. Please keep in mind that past performance is no guarantee of future
results.
Fund performance reflected overall weakness in equity markets, as rising
interest rates and inflationary concerns sent the market into a tailspin during
the first half of the year. A slowing economy hurt the basic materials sector,
while the Fund's extensive holdings of financial services stocks performed
poorly as interest rates climbed. However, with interest rates at or near their
peaks, the outlook for the financial services sector is promising.
The Fund benefited from its energy-related holdings, including Transocean,
Coastal Corporation and Williams Companies. The Fund also profited from several
well-timed purchases in the consumer staples sector, including Best Foods, Pepsi
and Clorox. And despite a volatile marketplace, the Fund's technology stocks
performed well during the period led by positions in American Power Conversion
and Philips Electronics.
STRATEGIC OUTLOOK
The Fund will continue to implement a strategy that focuses on the purchase
of stocks with favorable valuations and performance potential. This strategy has
resulted in three consecutive quarters of outperformance compared to the Russell
1000 Value Index. The Fund is also positioned for the potential to perform well
in an environment of declining interest rates and slower growth.
14
<PAGE> 16
VARIABLE TRUST EQUITY VALUE FUND(4)
[EQUITY VALUE PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
WFVT EQUITY VALUE FUND S&P 500 INDEX RUSSELL 1000 VALUE INDEX
---------------------- ------------- ------------------------
<S> <C> <C> <C>
10000 10000 10000
10000 10257 10125
6/96 10110 10296 10133
9710 9841 9750
9830 10049 10029
9/96 10250 10613 10427
10490 10906 10831
11170 11730 11616
12/96 10995 11497 11467
11540 12216 12023
11691 12311 12200
3/97 11348 11805 11761
11681 12509 12255
12215 13273 12940
6/97 12719 13864 13495
13535 14966 14511
12910 14128 13995
9/97 13525 14901 14840
13132 14403 14426
13716 15070 15063
12/97 13953 15329 15503
13994 15498 15285
14902 16615 16313
3/98 15647 17466 17312
15800 17644 17428
15585 17340 17170
6/98 15830 18044 17389
15381 17853 17082
13545 15273 14540
9/98 14290 16252 15375
15290 17572 16566
15993 18637 17338
12/98 16523 19710 17929
16472 20540 18073
16482 19899 17818
03/99 17091 20695 18187
17959 21496 19885
17917 20989 19667
6/99 18630 22131 20237
18145 21440 19644
17856 21334 18915
9/99 17195 20749 18255
17659 22062 19307
17814 22510 19156
12/99 17829 23836 19248
16911 22640 18620
15607 22212 17237
3/00 17163 24384 19340
17132 23650 19115
17435 23165 19316
6/00 17021 23737 18433
</TABLE>
AVERAGE ANNUAL TOTAL RETURN (%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<CAPTION>
SHARE PERFORMANCE
-----------------
<S> <C>
6-Month* (2.44)%
1-Year (11.94)%
Since Inception (05/01/98) (3.99)%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK S&P 500 INDEX RUSSELL 1000 VALUE INDEX
--------- --------------- --------------------------
<S> <C> <C>
6-Month* (0.42)% (4.23)%
1-Year 7.25% (8.92)%
</TABLE>
---------------
* Returns for periods less than one year are not annualized.
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 65%
Number of Holdings 74
NAV $8.97
</TABLE>
15
<PAGE> 17
TEN LARGEST EQUITY HOLDINGS (AS OF JUNE 30, 2000)(5)
<TABLE>
<CAPTION>
NAME % OF FUND
---- ---------
<S> <C>
Citigroup, Incorporated 5.28
Exxon Mobil Corporation 5.10
American International Group 3.61
Morgan Stanley Dean Witter 2.83
Coastal Corporation 2.68
SBC Communications, Incorporated 2.45
Chase Manhattan Corporation 2.42
MediaOne Group, Incorporated 2.29
IBM Corporation 2.28
Koninklijke Philips Electronics 2.24
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(6)
[PIE CHART]
<TABLE>
<S> <C>
Financial 27%
Energy 15%
Technology 14%
Telecommunications 7%
Cash 6%
Basic Materials 5%
Consumer Non-Cyclical 5%
Industrials 5%
Health Care 5%
Consumer Cyclical 4%
Consumer Services 4%
Commercial Services 2%
Utilities 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
Performance shown for the Wells Fargo Variable Trust Equity Value Fund for
periods prior to September 20, 1999, reflects performance of the Life and
Annuity Trust Equity Value Fund, its predecessor fund. Effective at the close of
business September 17, 1999, the Life and Annuity Trust and Norwest Select Funds
were reorganized into the Wells Fargo Variable Trust Funds.
(2) The S&P 500 Index is an unmanaged index of 500 widely-held common stocks
representing, among others, industrial, financial, utility and transportation
companies listed or traded on national exchanges or over-the-counter markets.
You cannot invest directly in an index.
(3) The Russell 1000 Value Index measures the performance of those Russell 1000
companies with lower price-to-book ratios and lower forecasted growth values.
You cannot invest directly in an index.
(4) The chart compares the performance of the Wells Fargo Variable Trust Equity
Value Fund since inception with the S&P 500 Index and the Russell 1000 Value
Index. The chart assumes a hypothetical $10,000 investment and reflects all
operating expenses of the Fund. The Fund is a professionally managed mutual
fund.
(5) The Ten Largest Equity Holdings are calculated based on the market value of
the securities divided by total market value of the portfolio.
(6) Portfolio holdings are subject to change.
16
<PAGE> 18
VARIABLE TRUST GROWTH FUND
INVESTMENT OBJECTIVE
The Variable Trust Growth Fund (the Fund) seeks long-term capital appreciation.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGER
Kelli Hill
INCEPTION DATE
04/12/94
PERFORMANCE HIGHLIGHTS
The Fund returned (0.17)%(1) for the six-month period ended June 30, 2000.
The Fund outperformed its benchmark, the S&P 500 Index(2), which returned
(0.42)%. The Fund distributed neither dividend income nor capital gains during
the period. Please keep in mind that past performance is no guarantee of future
results.
Strong performance by technology stocks accounted for the majority of the
Fund's gains during the early part of the year. In fact, the Fund's major
technology holdings, including Cisco, Texas Instruments and Intel, posted
double-digit returns in the first quarter. Financial services stocks, such as
Charles Schwab and State Street, were another source of relative outperformance.
In addition, the Fund's consumer cyclical holdings, including Kohl's Department
Stores, fared well.
Markets reversed course during the second quarter as rising interest rates
and investor uncertainty sparked unprecedented volatility. As a result, the
Nasdaq Composite Index(3) shed 38%, with the technology sector--and many of the
Fund's technology holdings--surrendering part of their first quarter gains.
Shares of Chase Manhattan also fell in value due to the impact of rising
interest rates, while Honeywell's disappointing second quarter earnings report
sent the stock downward. The telecommunications and consumer sectors were also
hit hard.
STRATEGIC OUTLOOK
With interest rates expected to stabilize during the second half of the
year, the investment climate for large-cap growth stocks should improve. The
Fund's extensive holdings in the technology, telecommunications and health care
sectors should perform well in this environment.
17
<PAGE> 19
VARIABLE TRUST GROWTH FUND(4)
[GROWTH PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
WFVT GROWTH FUND S&P 500
---------------- -------
<S> <C> <C>
10000 10000
10110 10164
6/94 9888 9915
10189 10241
10511 10660
9/94 10422 10400
10502 10633
10260 10246
12/94 10447 10398
10508 10668
10994 11083
3/95 11237 11409
11390 11745
11930 12214
6/95 12209 12497
12589 12911
12794 12944
9/95 13223 13490
12801 13442
13325 14031
12/95 13497 14301
13748 14788
14260 14925
3/96 14297 15068
14769 15290
15136 15683
6/96 14876 15742
14108 15047
14518 15364
9/96 15247 16227
15659 16675
16662 17934
12/96 16525 17579
17473 18678
16966 18824
3/97 16376 18050
17036 19126
18117 20294
6/97 18506 21197
20013 22883
18853 21601
9/97 19906 22783
18986 22022
19280 23041
12/97 19389 23438
19747 23696
20810 25404
3/98 21809 26705
21959 26977
21624 26513
6/98 22674 27590
22558 27297
19418 23353
9/98 20316 24850
21964 26867
23437 28496
12/98 24975 30137
25935 31406
25063 30426
3/99 26256 31643
27054 32867
26218 32092
6/99 27684 33838
26886 32781
26924 32619
9/99 26202 31725
27737 33733
28348 34418
12/99 30074 36445
28738 34615
28352 33961
3/00 30885 37283
29762 36160
28963 35419
6/00 30024 36294
</TABLE>
AVERAGE ANNUAL TOTAL RETURN (%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<CAPTION>
SHARE PERFORMANCE
-----------------
<S> <C>
6-Month* (0.17)%
1-Year 8.45%
5-Year 19.72%
Since Inception (04/12/94) 19.35%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK S&P 500 INDEX
--------- -------------
<S> <C> <C>
6-Month* (0.42)%
1-Year 7.25%
5-Year 23.80%
</TABLE>
---------------
* Returns for periods less than one year are not annualized.
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 23%
Number of Holdings 98
NAV $24.06
</TABLE>
18
<PAGE> 20
TEN LARGEST EQUITY HOLDINGS (AS OF JUNE 30, 2000)(5)
<TABLE>
<CAPTION>
NAME % OF FUND
---- ---------
<S> <C>
Cisco Systems, Incorporated 5.16%
General Electric Company 4.57%
Intel Corporation 3.88%
Microsoft Corporation 3.55%
Pfizer, Incorporated 3.16%
Exxon Mobil Corporation 2.56%
Citigroup, Incorporated 2.53%
American International Group 2.45%
EMC Corporation 2.44%
Wal-Mart Stores, Incorporated 2.37%
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(6)
[PIE CHART]
<TABLE>
<S> <C>
Technology 36%
Financial 13%
Health Care 11%
Telecommunications 7%
Consumer Cyclical 6%
Consumer Non-Cyclical 6%
Energy 6%
Consumer Services 4%
Basic Materials 3%
Industrials 3%
Commercial Services 2%
Utilities 2%
Cash 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
Performance shown for the Wells Fargo Variable Trust Growth Fund for periods
prior to September 20, 1999, reflects performance of the Life and Annuity Trust
Growth Fund, its predecessor fund. Effective at the close of business September
17, 1999, the Life and Annuity Trust and Norwest Select Funds were reorganized
into the Wells Fargo Variable Trust Funds.
(2) The S&P 500 Index is an unmanaged index of 500 widely-held common stocks
representing, among others, industrial, financial, utility and transportation
companies listed or traded on national exchanges or over-the-counter markets.
You cannot invest directly in an index.
(3) The Nasdaq Composite Index is a broad-based capitalization-weighted index of
all NASDAQ National Market & Small Cap stocks. You cannot invest directly in an
index.
(4) The chart compares the performance of the Wells Fargo Variable Trust Growth
Fund since inception with the S&P 500 Index. The chart assumes a hypothetical
$10,000 investment and reflects all operating expenses for the Fund. The Fund is
a professionally managed mutual fund.
(5) The Ten Largest Equity Holdings are calculated based on the market value of
the securities divided by total market value of the portfolio.
(6) Portfolio holdings are subject to change.
19
<PAGE> 21
VARIABLE TRUST LARGE COMPANY GROWTH FUND
INVESTMENT OBJECTIVE
The Variable Trust Large Company Growth Fund (the Fund) seeks long-term capital
appreciation by investing primarily in large, high-quality domestic companies
that the Advisor believes have superior growth potential.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Peregrine Capital Management, Inc.
FUND MANAGERS
John S. Dale, CFA
Gary E. Nussbaum, CFA
INCEPTION DATE
09/20/99
PERFORMANCE HIGHLIGHTS
The Fund returned 9.14%(1) for the six-month period ended June 30, 2000,
outperforming its benchmark, the S&P 500 Index(2), which returned (0.42)%. The
Fund distributed neither dividend income nor capital gains during the period.
Please keep in mind that past performance is no guarantee of future results.
The Fund performed exceptionally well in the first quarter, as favorable
earnings reports lifted growth stocks above most other market categories. Strong
performance among many of the Fund's top 10 holdings also boosted performance,
with shares of Schwab, Cisco, Medtronic and Intel increasing in value. In
addition, the Fund's health care holdings bounced back after a tumultuous 1999.
Even the Fund's financial-related holdings held up well amid a challenging
environment for financial stocks.
The second quarter was a period of unprecedented volatility in equity
markets. Still, the Fund withstood selling pressures due to the fundamental
earnings strength of its key stock holdings. The Fund took advantage of the
downturn in the technology and telecommunication sectors to build positions in
America Online, Oracle and JDS Uniphase. These companies are industry leaders
with proven track records and attractive earnings growth potential.
STRATEGIC OUTLOOK
The Fund's excellent performance during the first half of the year reflects
its emphasis on a select number of high-quality companies with above-average
earnings growth. The outlook for the Fund remains positive due to the strength
of the companies within its portfolio.
20
<PAGE> 22
VARIABLE TRUST LARGE COMPANY GROWTH FUND(3)
[LARGE COMPANY GROWTH PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
WFVT LARGE COMPANY GROWTH FUND S&P 500 INDEX
------------------------------ -------------
<S> <C> <C>
8/99 10000 10000
9/99 9590 9726
10/99 10420 10342
11/99 10830 10551
12/99 12030 11173
1/00 11800 10612
2/00 12000 10412
3/00 13430 11430
4/00 13020 11086
5/00 12200 10858
6/00 13130 11127
</TABLE>
TOTAL RETURN(%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<S> <C>
1-Month 7.62
3-Month (2.23)
6-Month 9.14
Since Inception
(09/20/99) 31.30%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK S&P 500 INDEX
--------- -------------
<S> <C>
1-Month 2.47
3-Month (2.66)
6-Month (0.42)
</TABLE>
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 6%
Number of Holdings 34
NAV $13.13
</TABLE>
21
<PAGE> 23
TEN LARGEST EQUITY HOLDINGS (AS OF JUNE 30, 2000)(4)
<TABLE>
<CAPTION>
% OF FUND
---------
<S> <C>
Intel Corporation 8.68%
Cisco Systems, Incorporated 7.66%
Pfizer, Incorporated 5.85%
Microsoft Corporation 5.07%
Charles Schwab Corporation 4.75%
Solectron Corporation 4.70%
Medtronic, Incorporated 4.56%
American International Group 4.49%
Goldman Sachs 4.32%
Home Depot, Incorporated 4.17%
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(5)
[SECTOR DISTRIBUTION PIE CHART]
<TABLE>
<S> <C>
Technology 43%
Financial 16%
Health Care 14%
Consumer Services 13%
Consumer Cyclical 8%
Cash 5%
Consumer Non-Cyclical 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
(2) The S&P 500 Index is an unmanaged index of 500 widely-held common stocks
representing, among others, industrial, financial, utility and transportation
companies listed or traded on national exchanges or over-the-counter markets.
You cannot invest directly in an index.
(3) The chart compares the performance of the Wells Fargo Variable Trust Large
Company Growth Fund since inception with the S&P 500 Index. The chart assumes a
hypothetical $10,000 investment and reflects all operating expenses of the Fund.
The Fund is a professionally managed mutual fund.
(4) The Ten Largest Equity Holdings are calculated based on the market value of
the securities divided by total market value of the portfolio.
(5) Portfolio holdings are subject to change.
22
<PAGE> 24
VARIABLE TRUST MONEY MARKET FUND
INVESTMENT OBJECTIVE
The Variable Trust Money Market Fund (the Fund) seeks high current income, while
preserving capital and liquidity.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGERS
Dave Sylvester
Laurie White
Mike Neitzke
INCEPTION DATE
05/19/94
PERFORMANCE HIGHLIGHTS
The Fund returned 2.69%(1) for the six-month period ended June 30, 2000.
The Fund distributed $0.03 per share in dividend income and no capital gains
during the period. Please keep in mind that past performance is no guarantee of
future results.
During the first half of the year, the Federal Reserve Board (the Fed)
raised interest rates on three occasions, including a half-point increase on May
16, 2000. The rate increases were designed to slow the economy and contain
mounting inflationary pressures. All together, short-term interest rates rose a
full percentage point over the period.
Amid a rising interest rate environment, the Fund reinvested assets from
its maturing securities into higher-yielding securities to enhance portfolio
performance. In addition, the Fund continues to selectively seek opportunities
along the yield curve, including longer-term securities, while maintaining its
core positions of securities with one- to three-month maturities. The Fund
believes that the asset-backed sector will provide additional yield while
offering superior credit quality--the best of both worlds.
STRATEGIC OUTLOOK
Looking forward, the Fed may still be in a tightening mode, but investors
are becoming increasingly convinced that interest rates have peaked in this
economic cycle. Growing optimism over the outlook for monetary policy and, more
generally, interest rates, is apparent from recent interest-rate declines and by
a yield curve that is inverted (short-term interest rates are higher than
long-term interest rates). The Fund seeks to maintain a stable net asset value
within any market environment.
23
<PAGE> 25
VARIABLE TRUST MONEY MARKET FUND
AVERAGE ANNUAL TOTAL RETURN (%) (AS OF JUNE 30, 2000)(1)
<TABLE>
<S> <C>
6-Month* 2.69%
1-Year 5.08%
5-Year 4.86%
Since Inception (05/19/94) 4.88%
</TABLE>
---------------
* Returns for periods less than one year are not annualized.
FUND YIELD SUMMARY
<TABLE>
<S> <C>
7-Day Simple Yield 5.89%
30-Day Simple Yield 5.82%
</TABLE>
24
<PAGE> 26
PORTFOLIO ALLOCATION (AS OF JUNE 30, 2000)(2)
[PIE CHART]
<TABLE>
<S> <C>
Commercial Paper 57%
Floating Rate Notes 14%
Short-Term Corporate Bonds 13%
Time Deposits 8%
Certificates of Deposit 6%
Repurchase Agreements 2%
</TABLE>
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Weighted Average Maturity 66 days
</TABLE>
MATURITY DISTRIBUTION (AS OF JUNE 30, 2000)(2)
[PIE CHART]
<TABLE>
<S> <C>
2-14 days 31%
30-59 days 36%
60-89 days 10%
90-179 days 10%
180-365 days 13%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return will fluctuate. The Fund's yield figures more closely
reflect the current earnings of the Fund than the total return figures. The
Fund's Advisor has committed through April 30, 2001 to waive fees and/or
reimburse expenses to the extent necessary to maintain a certain net operating
expense ratio for the Fund. Actual reductions of operating expenses can increase
total return to shareholders. Without these reductions, the Fund's returns would
have been lower. Performance figures of the Fund do not reflect charges pursuant
to the terms of the variable life insurance policies and variable annuity
contracts funded by separate accounts that invest in the Fund's shares.
Performance shown for the Wells Fargo Variable Trust Money Market Fund for
periods prior to September 20, 1999, reflects performance of the Life and
Annuity Trust Money Market Fund, its predecessor fund. Effective at the close of
business September 17, 1999, the Life and Annuity Trust and Norwest Select Funds
were reorganized into the Wells Fargo Variable Trust Funds.
(2) Portfolio holdings are subject to change.
25
<PAGE> 27
VARIABLE TRUST SMALL CAP GROWTH FUND
INVESTMENT OBJECTIVE
The Variable Trust Small Cap Growth Fund (the Fund) seeks long-term capital
appreciation.
ADVISOR
Wells Fargo Bank, N.A.
SUB-ADVISOR
Wells Capital Management Incorporated
FUND MANAGERS
Tom Zeifang, CFA
Chris Greene
INCEPTION DATE
05/01/95
PERFORMANCE HIGHLIGHTS
The Fund returned 8.13%(1) for the six-month period ended June 30, 2000,
outperforming the Russell 2000 Index(2), which returned 3.04%. The Fund
distributed neither dividends nor capital gains during the period. Please keep
in mind that past performance is no guarantee of future results.
The Fund's strategy of owning the best companies within a broadly
diversified portfolio paid off for investors during the period. During the first
half of the year, the Fund benefited from its holdings of New Economy stocks
throughout the technology, media and telecommunication sectors. The Fund's
emphasis on companies with sound business fundamentals and strong cash flow
enabled it to profit from its holdings of Silicon Valley Bancshares, even while
most other financial services stocks fell in value. Shares of Terayon
Communications, another prominent portfolio holding, also soared in value.
Weaker holdings included Cumulus Media, Bindview Development and Harmonic
Lightwave, all of which were sold during the period due to deteriorating growth
prospects. The Fund pursued attractive opportunities in technology sectors,
purchasing shares of Newport Corporation, a company that manufactures precision
components and automated assembly, measurement, and test equipment, plus
Technitrol, a company that sells electronic and metallurgical products to
manufacturers of computers, telecom devices, switches, circuit breakers and
other electronic goods.
STRATEGIC OUTLOOK
The outlook for small-cap stocks remains favorable, reflecting the
long-standing belief that the market increasingly rewards companies that are
able to adapt to continued change.
26
<PAGE> 28
VARIABLE TRUST SMALL CAP GROWTH FUND(3)
[SMALL CAP GROWTH PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
WFVT SMALL CAP GROWTH FUND RUSSELL 2000 INDEX
-------------------------- ------------------
<S> <C> <C>
10000 10000
10040 10172
6/95 10670 10700
11740 11316
11970 11549
9/95 11920 11756
11280 11231
11590 11702
12/95 11595 12011
11636 11999
11957 12374
3/96 12484 12626
13891 13301
14419 13827
6/96 13405 13259
12112 12100
13177 12803
9/96 13819 13303
14088 13099
14750 13638
12/96 15243 13997
15571 14277
14690 13931
3/97 13482 13274
13087 13311
15729 14792
6/97 16011 15426
17039 16143
17468 16513
9/97 18778 17721
17569 16941
16824 16833
12/97 16735 17129
16341 16860
17889 18108
3/98 18387 18856
18427 18962
17089 17941
6/98 17233 17979
15397 16525
11817 13315
9/98 12420 14357
12944 14943
13705 15726
12/98 14312 16699
13865 16921
12563 15550
3/99 12287 15793
12984 17208
12958 17459
6/99 13628 18248
13615 17747
13707 17090
9/99 14234 17093
16325 17163
19061 18188
12/99 23797 20247
24323 19921
30309 23210
3/00 26402 21680
23179 20375
20719 19187
6/00 25731 20861
</TABLE>
AVERAGE ANNUAL TOTAL RETURN% (AS OF JUNE 30, 2000)(2)
<TABLE>
<S> <C>
6-Month* 8.13%
1-Year 88.80%
Since Inception 20.08%
</TABLE>
<TABLE>
<CAPTION>
BENCHMARK RUSSELL 2000 INDEX
--------- ------------------
<S> <C>
6-Month* 3.04%
1-Year 14.32%
</TABLE>
---------------
* Returns for periods less than one year are not annualized.
FUND CHARACTERISTICS (AS OF JUNE 30, 2000)
<TABLE>
<S> <C>
Portfolio Turnover 132%
Number of Holdings 127
NAV $19.56
</TABLE>
27
<PAGE> 29
TEN LARGEST EQUITY HOLDINGS (AS OF JUNE 30, 2000)(4)
<TABLE>
<CAPTION>
NAME % OF FUND
---- ---------
<S> <C>
Diamond Tech Partners, Incorporated 2.27%
Alteon Websystems, Incorporated 2.19%
Vignette Corporation 2.10%
Art Technology Group, Incorporated 2.05%
Entrust Technologies, Incorporated 1.76%
Active Software, Incorporated 1.76%
King Pharmaceuticals, Incorporated 1.69%
Silicon Valley Bancshares 1.65%
Micrel, Incorporated 1.57%
Tut Systems, Incorporated 1.55%
</TABLE>
SECTOR DISTRIBUTION (AS OF JUNE 30, 2000)(5)
[PIE CHART]
<TABLE>
<S> <C>
Technology 45%
Health Care 15%
Commercial Services 9%
Cash 6%
Financial 6%
Consumer Cyclical 5%
Energy 5%
Industrials 3%
Telecommunications 3%
Consumer Services 2%
Transportation 1%
</TABLE>
---------------
(1) FIGURES QUOTED REPRESENT PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE
RESULTS. Investment return and principal value of an investment will fluctuate
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. The Fund's Advisor has committed through April 30, 2001 to
waive fees and/or reimburse expenses to the extent necessary to maintain a
certain net operating expense ratio for the Fund. Actual reductions of operating
expenses can increase total return to shareholders. Without these reductions,
the Fund's returns would have been lower. Performance figures of the Fund do not
reflect charges pursuant to the terms of the variable life insurance policies
and variable annuity contracts funded by separate accounts that invest in the
Fund's shares.
Performance shown for the Wells Fargo Variable Trust Small Cap Growth Fund for
periods prior to September 20, 1999, reflects performance of the Norwest Select
Small Company Stock Fund (the accounting survivor of a merger of the Life and
Annuity Trust Strategic Growth Fund and the Norwest Select Small Company Stock
Fund), its predecessor fund. Effective at the close of business September 17,
1999, the Life and Annuity Trust and Norwest Select Funds were reorganized into
the Wells Fargo Variable Trust Funds.
(2) The Russell 2000 Index is an index subset of the Russell 3000 Index and
includes the 2,000 smallest stocks representing approximately 11% of the U.S.
equity market. You cannot invest directly in an index.
(3) The chart compares the performance of the Wells Fargo Variable Trust Small
Cap Growth Fund since inception with the Russell 2000 Index. The chart assumes a
hypothetical $10,000 investment and reflects all operating expenses of the Fund.
The Fund is a professionally managed mutual fund.
(4) The Ten Largest Equity Holdings are calculated based on the market value of
the securities divided by total market value of the portfolio.
(5) Portfolio holdings are subject to change.
28
<PAGE> 30
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--61.81%
AEROSPACE--0.02%
1,411 B.F. Goodrich Company $ 48,062
AGRICULTURAL PRODUCTION--CROPS--0.04%
4,214 Nabisco Group Holdings $ 109,301
AMUSEMENT & RECREATION SERVICES--0.01%
1,640 Harrah's Entertainment Incorporated+ $ 34,338
APPAREL & ACCESSORY STORES--0.28%
10,958 Gap Incorporated $ 342,438
4,184 Kohls Corporation+ 232,735
5,542 Limited Incorporated 119,845
1,745 Nordstrom Incorporated 42,098
------------
$ 737,116
APPAREL & OTHER FINISHED PRODUCTS MADE FROM FABRICS &
SIMILAR MATERIALS--0.02%
744 Liz Claiborne Incorporated $ 26,225
1,527 V.F. Corporation 36,362
------------
$ 62,587
AUTOMOTIVE DEALERS & GASOLINE SERVICE STATIONS--0.01%
1,748 AutoZone Incorporated+ $ 38,456
AUTOMOTIVE REPAIR, SERVICES & PARKING--0.01%
774 Ryder Systems Incorporated $ 14,658
BUILDING CONSTRUCTION--GENERAL CONTRACTORS & OPERATIVE
BUILDERS--0.06%
793 Centex Corporation $ 18,635
621 Kaufman & Broad Home Corporation 12,304
5,729 Masco Corporation 103,480
561 Pulte Corporation 12,132
------------
$ 146,551
BUILDING MATERIALS, HARDWARE, GARDEN SUPPLY & MOBILE HOME
DEALERS--0.65%
29,768 Home Depot Incorporated $ 1,486,540
4,915 Lowe's Company Incorporated 201,822
------------
$ 1,688,362
</TABLE>
29
<PAGE> 31
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
BUSINESS SERVICES--4.58%
4,499 3COM Corporation+ $ 259,255
1,535 Adobe Systems Incorporated 199,550
29,583 America Online Incorporated+ 1,560,503
780 Autodesk Incorporated 27,056
8,073 Automatic Data Processing 432,410
3,169 BMC Software Incorporated+ 115,619
2,353 Cabletron Systems Incorporated+ 59,413
9,237 Cendant Corporation+ 129,318
1,870 Ceridian Corporation+ 44,997
2,332 Citrix Systems+ 44,162
7,546 Computer Associates International Incorporated 386,261
2,109 Computer Sciences Corporation+ 157,515
1,950 Convergys Corporation+ 101,156
958 Deluxe Corporation 22,573
1,663 Ecolab Incorporated 64,961
6,019 Electronic Data Systems Corporation 248,284
1,847 Equifax Incorporated 48,484
5,335 First Data Corporation 264,749
3,918 IMS Health Incorporated 70,524
3,881 Interpublic Group Companies Incorporated 166,882
3,649 McKesson HBOC Incorporated 76,401
1,000 Mercury Interactive Corporation+ 96,750
1,237 NCR Corporation+ 48,166
4,163 Novell Incorporated+ 38,508
2,260 Omnicom Group 201,281
36,520 Oracle Systems Corporation+ 3,069,963
3,574 Parametric Technology Company+ 39,314
3,521 Peoplesoft Incorporated+ 58,977
750 Sapient Corporation+ 80,203
2,550 Siebel Systems Incorporated+ 417,084
20,395 Sun Microsystems Incorporated+ 1,854,670
3,977 Unisys Corporation+ 57,915
5,052 VERITAS Software Corporation+ 570,955
6,996 Yahoo Incorporated+ 866,630
875 Young & Rubicam Incorporated 50,039
------------
$ 11,930,528
</TABLE>
30
<PAGE> 32
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
CHEMICALS & ALLIED PRODUCTS--6.92%
19,924 Abbott Laboratories $ 887,863
2,939 Air Products & Chemicals Incorporated 90,558
725 Alberto Culver Company Class B 22,158
1,317 Alza Corporation+ 77,868
16,801 American Home Products Corporation 987,058
13,233 Amgen Incorporated+ 929,618
1,471 Avery Dennison Corporation 98,741
3,062 Avon Products Incorporated 136,259
1,904 Biogen Incorporated+ 122,808
25,368 Bristol-Myers Squibb Company 1,477,686
3,061 Clorox Company 137,171
7,416 Colgate-Palmolive Company 444,033
8,667 Dow Chemical Company 261,635
13,431 DuPont (E.I.) de Nemours & Company 587,606
1,006 Eastman Chemical Company 48,037
374 FMC Corporation+ 21,692
13,441 Gillette Company 469,594
745 Great Lakes Chemical Corporation 23,468
1,388 Hercules Incorporated 19,519
1,332 International Flavors & Fragrances Incorporated 40,210
14,515 Lilly (Eli) & Company 1,449,686
910 Mallinckrodt Incorporated 39,528
2,700 MedImmune Incorporated+ 199,800
29,619 Merck & Company Incorporated 2,269,556
81,027 Pfizer Incorporated 3,889,296
16,339 Pharmacia Corporation 844,522
2,260 PPG Industries Incorporated 100,146
2,066 Praxair Incorporated 77,346
16,822 Procter & Gamble Company 963,060
2,827 Rohm & Haas Company 97,532
18,829 Schering-Plough Corporation 950,865
2,116 Sherwin-Williams Company 44,833
1,163 Sigma Aldrich 34,018
1,731 Union Carbide Corporation 85,685
957 W.R. Grace & Company+ 11,604
1,221 Watson Pharmaceuticals Incorporated+ 65,629
------------
$ 18,006,688
</TABLE>
31
<PAGE> 33
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMERCIAL SERVICES--0.01%
1,487 Quintiles Transnational Corporation+ $ 21,003
COMMUNICATIONS--4.40%
4,046 Alltel Corporation $ 250,598
40,822 AT&T Corporation 1,290,995
19,884 Bell Atlantic Corporation+ 1,010,355
24,233 BellSouth Corporation 1,032,931
1,787 Centurytel Incorporated 51,376
4,353 Clear Channel Communications Incorporated+ 326,475
11,543 Comcast Corporation Class A+ 467,492
11,327 Global Crossing Limited+ 298,042
12,363 GTE Corporation 769,597
7,873 MediaOne Group Incorporated+ 522,088
9,752 Nextel Communications Class A+ 596,701
43,767 SBC Communications Incorporated 1,892,905
11,279 Sprint Corporation (FON Group) 575,229
11,793 Sprint Corporation (PCS Group)+ 701,684
36,836 WorldCom Incorporated+ 1,689,852
------------
$ 11,476,320
COMPUTERS--2.08%
67,763 Microsoft Corporation+ $ 5,421,040
CONSUMER PRODUCTS--0.02%
2,097 Fortune Brands Incorporated $ 48,362
</TABLE>
32
<PAGE> 34
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
DOMESTIC DEPOSITORY INSTITUTIONS--3.80%
5,024 AmSouth Bancorp $ 79,128
14,724 Banc One Corporation 391,106
21,308 Bank of America Corporation 916,243
9,473 Bank of New York Incorporated 440,495
4,495 BB&T Corporation 107,318
2,700 Charter One Financial Incorporated 62,100
15,930 Chase Manhattan Corporation 733,775
43,417 Citigroup Incorporated 2,615,873
2,005 Comerica Incorporated 89,974
3,974 Fifth Third Bancorp 251,356
12,602 First Union Corporation 312,687
12,475 Firstar Corporation 262,755
11,584 Fleet Boston Financial Corporation 393,856
2,061 Golden West Financial 84,115
2,986 Huntington Bancshares Incorporated 47,216
2,098 JP Morgan & Company Incorporated 231,042
5,669 KeyCorp 99,916
6,339 Mellon Financial Corporation 230,977
7,821 National City Corporation 133,446
2,888 Northern Trust Corporation 187,901
1,783 Old Kent Financial Corporation 47,693
3,745 PNC Bank Corporation 175,547
2,822 Regions Financial Corporation 56,087
2,175 SouthTrust Corporation 49,209
2,045 State Street Corporation 216,898
2,250 Summit Bancorp 55,406
3,880 Sun Trust Banks Incorporated 177,268
3,614 Synovus Financial Corporation 63,697
9,697 U.S. Bancorp 186,667
1,796 Union Planters Corporation 50,176
2,630 Wachovia Corporation 142,678
7,074 Washington Mutual Incorporated 204,262
20,728 Wells Fargo & Company 803,210
------------
$ 9,900,077
EATING & DRINKING PLACES--0.29%
1,673 Darden Restaurants Incorporated $ 27,186
17,164 McDonald's Corporation 565,338
2,350 Starbucks Corporation+ 89,741
1,966 Tricon Global Restaurants Incorporated+ 55,540
1,562 Wendy's International Incorporated 27,823
------------
$ 765,628
</TABLE>
33
<PAGE> 35
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
ELECTRIC, GAS & SANITARY SERVICES--1.30%
5,510 AES Corporation+ $ 251,393
2,445 Allied Waste Industries Incorporated+ 24,450
1,780 Ameren Corporation 60,075
4,162 American Electric Power Company 123,299
2,064 Carolina Power & Light Company 65,919
2,035 Cinergy Corporation 51,765
1,487 CMS Energy Corporation 32,900
1,047 Columbia Energy Group 68,709
2,739 Consolidated Edison Incorporated 81,143
1,905 Constellation Energy Group 62,032
3,069 Dominion Resources Incorporated 131,583
1,863 DTE Energy Company 56,938
4,711 Duke Energy Corporation 265,582
344 Eastern Enterprises 21,672
4,344 Edison International 89,052
2,923 El Paso Energy Corporation 148,890
2,977 Entergy Corporation 80,937
2,986 First Energy Corporation 69,798
1,275 Florida Progress Corporation 59,766
2,295 FPL Group Incorporated 113,602
1,578 GPU Incorporated 42,705
1,549 New Century Energies Incorporated 46,470
2,287 Niagara Mohawk Holdings Incorporated+ 31,875
617 NICOR Incorporated 20,130
1,974 Northern States Power Company 39,850
395 Oneok Incorporated 10,245
4,939 PG&E Company 121,623
2,192 PECO Energy Company 88,365
457 Peoples Energy Corporation 14,795
1,116 Pinnacle West Capital Corporation 37,805
1,857 PP& L Resources Incorporated 40,738
2,812 Public Service Enterprise Group 97,366
3,798 Reliant Energy Incorporated 112,278
2,612 Sempra Energy 44,404
8,400 Southern Company 195,825
3,435 Texas Utilities Company 101,333
7,963 Waste Management Incorporated 151,297
5,689 Williams Companies Incorporated 237,160
2,333 Unicom Corporation 90,258
------------
$ 3,384,027
</TABLE>
34
<PAGE> 36
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS, EXCEPT
COMPUTER EQUIPMENT--9.61%
1,328 Adaptec Incorporated+ $ 30,212
4,368 ADC Telecommunications Incorporated+ 366,366
1,978 Advanced Micro Devices+ 152,801
2,550 Altera Corporation+ 259,941
2,500 American Power Conversion Corporation+ 102,031
1,060 Andrew Corporation+ 35,576
2,753 Conexant Systems Incorporated+ 133,865
1,192 Cooper Industries Incorporated 38,815
5,484 Emerson Electric Company 331,097
127,362 General Electric Company 6,750,185
43,123 Intel Corporation 5,765,005
3,985 Linear Technology Corporation 254,791
3,939 LSI Logic Corporation+ 213,198
41,917 Lucent Technologies Incorporated 2,483,581
3,650 Maxim Integrated Products Incorporated+ 247,972
1,027 Maytag Corporation 37,871
7,126 Micron Technology Incorporated+ 627,533
2,548 Molex Incorporated 122,623
27,686 Motorola Incorporated 804,624
2,238 National Semiconductor Corporation+ 127,007
552 National Service Industries Incorporated 10,764
3,910 Network Appliance Incorporated+ 314,755
38,140 Nortel Networks Corporation 2,603,054
1,650 Novellus Systems Incorporated+ 93,328
9,519 Qualcomm Incorporated+ 571,140
1,900 Sanmina Corporation+ 162,450
2,061 Scientific-Atlanta Incorporated 153,545
5,273 Tellabs Incorporated+ 360,871
21,072 Texas Instruments Incorporated 1,447,383
757 Thomas & Betts Corporation 14,478
948 Whirlpool Corporation 44,201
1,188 W W Grainger Incorporated 36,605
4,152 Xilink Incorporated+ 342,800
------------
$ 25,040,468
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT & RELATED
SERVICES--0.20%
2,066 Dun & Bradstreet Corporation $ 59,139
5,685 Halliburton Company 268,261
4,751 Paychex Incorporated 199,542
------------
$ 526,942
</TABLE>
35
<PAGE> 37
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
FABRICATED METAL PRODUCTS, EXCEPT MACHINERY & TRANSPORTATION
EQUIPMENT--0.06%
396 Ball Corporation $ 12,746
862 Crane Company 20,957
1,686 Crown Cork & Seal Company 25,290
1,451 Parker-Hannifin Corporation 49,697
751 Snap-On Incorporated 19,995
1,139 Stanley Works 27,051
------------
$ 155,736
FOOD & KINDRED PRODUCTS--2.04%
501 Adolph Coors Company Class B $ 30,311
5,815 Anheuser-Busch Incorporated 434,308
7,814 Archer-Daniels-Midland Company 76,675
3,531 Bestfoods 244,522
877 Brown-Forman Corporation 47,139
5,456 Campbell Soup Company 158,906
31,852 Coca-Cola Company 1,829,498
5,520 Coca-Cola Enterprises Incorporated 90,045
6,349 ConAgra Incorporated 121,028
3,783 General Mills Incorporated 144,700
4,527 H J Heinz Company 198,056
1,741 Hershey Foods Corporation 84,765
5,241 Kellogg Company 155,920
18,556 Pepsico Incorporated 824,581
1,708 Quaker Oats Company 128,314
3,907 Ralston-Purina Group 77,896
11,192 Sara Lee Corporation 216,146
5,608 Seagram Company Limited 325,264
1,482 Wm. Wrigley Jr Company 118,838
------------
$ 5,306,912
FOOD STORES--0.17%
5,469 Albertson's Incorporated $ 181,844
499 Great Atlantic & Pacific Tea Company 8,296
10,781 Kroger Company+ 237,856
1,915 Winn-Dixie Stores Incorporated 27,408
------------
$ 455,404
</TABLE>
36
<PAGE> 38
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
GENERAL MERCHANDISE STORES--1.69%
1,468 Consolidated Stores Corporation+ $ 17,616
1,354 Dillards Incorporated Class A 16,587
4,252 Dollar General Corporation 82,914
2,725 Federated Department Stores Incorporated+ 91,969
913 Harcourt General Incorporated 49,644
3,395 JC Penney Company Incorporated 62,595
6,292 K-Mart Corporation+ 42,864
4,266 May Department Stores Company 102,384
4,573 Sears Roebuck & Company 149,194
5,863 Target Corporation 340,054
950 Tiffany & Company 64,125
3,887 TJX Companies Incorporated 72,881
57,365 Wal-Mart Stores Incorporated 3,305,657
------------
$ 4,398,484
HEALTH SERVICES--0.14%
7,185 Columbia HCA Healthcare Corporation $ 218,244
4,966 Healthsouth Corporation+ 35,693
1,346 Manor Care Incorporated+ 9,422
4,023 Tenet Healthcare Corporation 108,621
------------
$ 371,980
HEAVY CONSTRUCTION OTHER THAN BUILDING
CONSTRUCTION-CONTRACTORS--0.01%
978 Fluor Corporation $ 30,929
HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES--0.16%
2,644 Best Buy Company Incorporated+ $ 167,233
2,584 Circuit City Stores Incorporated 85,757
2,550 Leggett & Platt Incorporated 42,075
2,428 RadioShack Corporation 115,027
------------
$ 410,092
HOTELS, ROOMING HOUSES, CAMPS & OTHER LODGING PLACES--0.06%
4,736 Hilton Hotels Corporation $ 44,400
3,136 Marriott International 113,092
------------
$ 157,492
</TABLE>
37
<PAGE> 39
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--6.83%
4,204 Apple Computer Incorporated+ $ 220,185
10,372 Applied Materials Incorporated+ 939,963
4,244 Baker Hughes Incorporated 135,808
1,119 Black & Decker Corporation 43,991
303 Briggs & Stratton Corporation 10,378
1,225 Brunswick Corporation 20,289
4,509 Caterpillar Incorporated 152,742
89,581 Cisco Systems Incorporated+ 5,693,991
21,844 Compaq Computer Corporation 558,387
4,677 Compuware Corporation+ 48,524
530 Cummins Engine Company Incorporated 14,443
3,033 Deere & Company 112,221
33,160 Dell Computer Corporation+ 1,635,203
2,602 Dover Corporation 105,544
27,914 EMC Corporation+ 2,147,633
4,120 Gateway Incorporated+ 233,810
12,826 Hewlett Packard Company 1,601,647
2,114 Ingersoll-Rand Company 85,089
22,812 International Business Machines Corporation 2,499,340
1,675 Lexmark International Incorporated Class A+ 112,644
753 McDermott International Incorporated 6,636
5,111 Minnesota Mining & Manufacturing Company 421,658
1,601 Pall Corporation 29,619
3,339 Pitney Bowes Incorporated 133,560
2,902 Seagate Technology Incorporated+ 159,610
7,648 Solectron Corporation+ 320,260
824 Timken Company 15,347
6,072 United Technologies Corporation 357,489
------------
$ 17,816,011
INSURANCE AGENTS, BROKERS & SERVICE--0.23%
3,307 AON Corporation $ 102,724
2,233 Humana Incorporated+ 10,886
3,488 Marsh & McLennan Companies Incorporated 364,278
1,361 MGIC Investment Corporation 61,926
1,558 T Rowe Price Associates 66,215
------------
$ 606,029
</TABLE>
38
<PAGE> 40
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
INSURANCE CARRIERS--1.76%
1,821 Aetna Incorporated $ 116,885
3,418 AFLAC Incorporated 157,014
9,593 Allstate Corporation 213,444
3,188 American General Corporation 194,468
19,826 American International Group Incorporated 2,329,555
2,288 Chubb Corporation 140,712
2,098 CIGNA Corporation 196,163
2,130 Cincinnati Financial Corporation 66,962
2,798 Hartford Financial Services Group 156,513
1,336 Jefferson Pilot Corporation 75,401
2,503 Lincoln National Corporation 90,421
1,273 Loews Corporation 76,380
1,286 MBIA Incorporated 61,969
937 Progressive Corporation 69,338
1,808 Providian Financial Corporation 162,720
1,658 Safeco Corporation 32,953
2,756 St. Paul Companies Incorporated 94,049
1,700 Torchmark Corporation 41,969
2,117 United Healthcare Incorporated 181,533
3,077 Unum Provident Corporation 61,732
814 Wellpoint Health Networks+ 58,964
------------
$ 4,579,145
LUMBER & WOOD PRODUCTS, EXCEPT FURNITURE--0.01%
1,356 Louisiana-Pacific Corporation $ 14,747
</TABLE>
39
<PAGE> 41
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
MEASURING, ANALYZING, & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS--1.63%
5,829 Agilent Technologies Incorporated+ $ 429,889
1,687 Allergan Incorporated 125,682
4,530 Analog Devices Incorporated+ 344,280
681 Bausch & Lomb Incorporated 52,692
3,750 Baxter International Incorporated 263,672
3,229 Becton Dickinson & Company 92,632
1,489 Biomet Incorporated 57,233
5,302 Boston Scientific Corporation+ 116,313
663 C R Bard Incorporated 31,907
1,813 Danaher Corporation 89,630
4,019 Eastman Kodak Company 239,131
969 Eaton Corporation 64,923
3,961 Guidant Corporation+ 196,070
10,266 Honeywell International Incorporated 345,836
1,083 Johnson Controls Incorporated 55,571
2,369 KLA-Tencor Corporation+ 138,735
15,380 Medtronic Incorporated 766,116
581 Millipore Corporation 43,793
2,666 PE Biosystems Group 175,623
598 PerkinElmer Incorporated 39,543
582 Polaroid Corporation 10,512
4,337 Raytheon Companies Class B 83,487
1,100 St. Jude Medical Incorporated+ 50,463
608 Tektronix Incorporated 44,992
2,223 Teradyne Incorporated+ 163,391
1,998 Thermo Electron Corporation+ 42,083
8,560 Xerox Corporation 177,620
------------
$ 4,241,819
METAL MINING--0.11%
5,111 Barrick Gold Corporation $ 92,956
2,117 Freeport McMoran Copper & Gold Incorporated Class B+ 19,582
3,448 Homestake Mining Company 23,705
2,462 Inco Limited+ 37,853
2,147 Newmont Mining Corporation 46,429
1,046 Phelps Dodge Corporation 38,898
4,170 Placer Dome Incorporated 39,876
------------
$ 299,299
MINING & QUARRYING OF NONMETALLIC MINERALS, EXCEPT
FUELS--0.02%
1,276 Vulcan Materials Company $ 54,469
MISCELLANEOUS MANUFACTURING INDUSTRIES--0.44%
2,256 Hasbro Incorporated $ 33,981
5,444 Mattel Incorporated 71,793
21,709 Tyco International Limited 1,028,463
------------
$ 1,134,237
</TABLE>
40
<PAGE> 42
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
MISCELLANEOUS RETAIL--0.57%
1,803 Bed Bath & Beyond Incorporated+ $ 65,359
5,756 Costco Wholesale Corporation+ 189,948
5,021 CVS Corporation 200,840
7,143 Kimberly-Clark Corporation 409,830
508 Longs Drug Stores Corporation 11,049
4,266 Office Depot Incorporated+ 26,663
3,435 Rite Aid Corporation 22,542
6,198 Staples Incorporated+ 95,294
2,891 Toys "R" Us Incorporated+ 42,100
12,963 Walgreen's Company 417,247
------------
$ 1,480,872
MOTION PICTURES--0.89%
16,947 Time Warner Incorporated $ 1,287,972
26,737 Walt Disney Company 1,037,730
------------
$ 2,325,702
NONDEPOSITORY CREDIT INSTITUTIONS--1.13%
17,179 American Express Corporation $ 895,455
9,384 Associates First Capital Corporation 209,381
2,545 Capital One Financial Corporation 113,571
4,363 Conseco Incorporated 42,539
1,454 Countrywide Credit Industries Incorporated 44,074
8,963 Federal Home Loan Mortgage Corporation 363,002
12,936 Federal National Mortgage Association 675,098
6,054 Household International Incorporated 251,619
10,337 MBNA Corporation 280,391
2,043 SLM Holding Corporation 76,485
------------
$ 2,951,615
OIL & GAS EXTRACTION--0.71%
1,622 Anadarko Petroleum Corporation $ 79,985
1,447 Apache Corporation 85,102
2,807 Burlington Resources Incorporated 107,368
9,397 Enron Corporation 606,107
1,224 Kerr McGee Corporation 72,140
4,754 Occidental Petroleum Corporation 100,131
1,187 Rowan Companies Incorporated+ 36,055
7,298 Schlumberger Limited 544,613
2,701 Transocean Sedco Forex Incorporated+ 144,335
3,269 Union Pacific Resources Group Incorporated 71,918
------------
$ 1,847,754
</TABLE>
41
<PAGE> 43
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
PAPER & ALLIED PRODUCTS--0.26%
660 Bemis Company Incorporated $ 22,193
740 Boise Cascade Corporation 19,148
2,727 Fort James Corporation 63,062
2,194 Georgia-Pacific Group 57,593
6,192 International Paper Company 184,599
1,303 Mead Corporation 32,901
2,243 Pactiv Corporation+ 17,664
1,069 Sealed Air Corporation+ 55,989
725 Temple-Inland Incorporated 30,450
1,277 Westvaco Corporation 31,686
3,034 Weyerhaeuser Company 130,462
1,426 Willamette Industries Incorporated 38,859
------------
$ 684,606
PERSONAL SERVICES--0.03%
1,264 H&R Block Incorporated $ 40,922
1,688 Sabre Holdings Corporation 48,108
------------
$ 89,030
PETROLEUM REFINING & RELATED INDUSTRIES--2.77%
1,187 Amerada Hess Corporation $ 73,297
915 Ashland Incorporated 32,082
8,352 Chevron Corporation 708,354
8,054 Conoco Incorporated Class B 197,826
44,805 Exxon Mobil Corporation 3,517,193
3,250 Phillips Petroleum Company 164,734
27,607 Royal Dutch Petroleum Company ADR 1,699,541
1,143 Sunoco Incorporated 33,647
7,096 Texaco Incorporated 377,862
2,751 Coastal Corporation 167,467
1,856 Tosco Corporation 52,548
3,130 Unocal Corporation 103,681
4,022 USX-Marathon Group 100,801
------------
$ 7,229,033
PRIMARY METAL INDUSTRIES--0.20%
2,823 Alcan Aluminum Limited $ 87,513
11,104 Alcoa Incorporated 322,016
1,179 Allegheny Technologies Incorporated 21,222
1,646 Bethlehem Steel Corporation+ 5,864
1,594 Engelhard Corporation 27,198
1,122 Nucor Corporation 37,236
1,147 USX-US Steel Group 21,291
1,157 Worthington Industries Incorporated 12,149
------------
$ 534,489
</TABLE>
42
<PAGE> 44
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
PRINTING, PUBLISHING & ALLIED INDUSTRIES--0.81%
809 American Greetings Corporation Class A $ 15,371
1,143 Dow Jones & Company Incorporated 83,725
3,451 Gannett Company Incorporated 206,413
1,045 Knight-Ridder Incorporated 55,581
2,506 McGraw-Hill Incorporated 135,324
648 Meredith Corporation 21,870
2,197 New York Times Company Class A 86,782
1,620 R.R. Donnelley & Sons Company 36,551
3,979 Tribune Company 139,265
19,631 Viacom Incorporated Class B+ 1,338,588
------------
$ 2,119,470
RAILROAD TRANSPORTATION--0.19%
5,558 Burlington Northern Santa Fe $ 127,487
2,801 CSX Corporation 59,346
1,442 Kansas City Southern Industries Incorporated 127,887
4,956 Norfolk Southern Corporation 73,721
3,206 Union Pacific Corporation 119,223
------------
$ 507,664
RUBBER & MISCELLANEOUS PLASTICS PRODUCTS--0.21%
491 Armstrong World Industries Incorporated $ 7,518
1,040 Cooper Tire and Rubber Company 11,570
1,998 Goodyear Tire & Rubber Company 39,960
3,875 Illinois Tool Works Incorporated 220,875
3,464 Newell Rubbermaid Incorporated 89,198
3,556 Nike Incorporated Class B 141,573
690 Reebok International Limited+ 10,997
767 Tupperware Corporation 16,874
------------
$ 538,565
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--1.06%
1,480 Bear Stearns & Company Incorporated $ 61,605
17,530 Charles Schwab Corporation 589,446
3,161 Franklin Resources Incorporated 96,015
1,573 Lehman Brothers Holdings 148,747
5,009 Merrill Lynch & Company Incorporated 576,035
14,524 Morgan Stanley Dean Witter & Company 1,209,123
1,852 Painewebber Group Incorporated 84,266
------------
$ 2,765,237
STONE, CLAY, GLASS & CONCRETE PRODUCTS--0.38%
3,536 Corning Incorporated $ 954,278
769 Owens Corning Fiberglass Corporation 7,113
1,993 Owens-Illinois Incorporated+ 23,293
------------
$ 984,684
</TABLE>
43
<PAGE> 45
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
TELECOMMUNICATIONS--0.28%
1,921 Comverse Technology Incorporated+ $ 178,653
6,523 US West Incorporated 559,347
------------
$ 738,000
TEXTILE MILL PRODUCTS--0.01%
417 Russell Corporation $ 8,340
221 Springs Industries Incorporated Class A 7,113
------------
$ 15,453
TOBACCO PRODUCTS--0.31%
29,440 Philip Morris Companies Incorporated $ 782,000
2,236 UST Incorporated 32,841
------------
$ 814,841
TRANSPORTATION BY AIR--0.11%
1,898 AMR Corporation+ $ 50,178
1,596 Delta Air Lines Incorporated 80,698
6,470 Southwest Airlines Company 122,526
884 US Air Group Incorporated+ 34,476
------------
$ 287,878
TRANSPORTATION EQUIPMENT--0.97%
11,641 Boeing Company $ 486,739
2,046 Dana Corporation 43,350
7,247 Delphi Automotive Systems Corporation 105,535
15,504 Ford Motor Company 666,672
2,610 General Dynamics Corporation 136,373
6,877 General Motors Corporation 399,296
3,905 Harley-Davidson Incorporated 150,343
1,133 ITT Industries Incorporated 34,415
5,125 Lockheed Martin Corporation 127,164
800 Navistar International+ 24,850
886 Northrop Grumman Corporation 58,698
1,029 PACCAR Incorporated 40,838
2,432 Rockwell International Corporation 76,608
1,899 Textron Incorporated 103,139
1,592 TRW Incorporated 69,053
------------
$ 2,523,073
TRANSPORTATION SERVICES--0.05%
3,756 Fedex Corporation+ $ 142,728
WATER TRANSPORTATION--0.06%
7,809 Carnival Corporation Class A $ 152,276
</TABLE>
44
<PAGE> 46
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
WHOLESALE TRADE-DURABLE GOODS--0.73%
2,318 Genuine Parts Company $ 46,360
17,891 Johnson & Johnson 1,822,646
382 Potlatch Corporation 12,654
2,030 Visteon Corporation+ 24,613
------------
$ 1,906,273
WHOLESALE TRADE-NONDURABLE GOODS--0.41%
3,546 Cardinal Health Incorporated $ 262,404
6,414 Safeway Incorporated+ 289,432
1,784 Supervalu Incorporated 34,008
4,257 Sysco Corporation 179,326
7,330 Unilever NV 315,190
------------
$ 1,080,360
TOTAL COMMON STOCK
(Cost $137,144,063) $161,152,902
</TABLE>
45
<PAGE> 47
WELLS FARGO VARIABLE TRUST ASSET ALLOCATION FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS--37.61%
U.S. TREASURY BILLS--2.82%
$2,117,000 U.S. Treasury Bills 5.22++ 07/13/00 $ 2,113,849
4,883,000 U.S. Treasury Bills 5.50 08/03/00 4,859,681
375,000 U.S. Treasury Bills@ 5.78 09/21/00 370,275
-------------
7,343,805
U.S. TREASURY BONDS--34.79%
5,580,000 U.S. Treasury Bonds 8.75 08/15/20 7,158,080
3,220,000 U.S. Treasury Bonds 7.88 02/15/21 3,823,750
1,970,000 U.S. Treasury Bonds 8.13 05/15/21 2,398,475
3,170,000 U.S. Treasury Bonds 8.13 08/15/21 3,865,403
8,100,000 U.S. Treasury Bonds 8.00 11/15/21 9,775,647
1,810,000 U.S. Treasury Bonds 7.25 08/15/22 2,030,585
2,610,000 U.S. Treasury Bonds 7.63 11/15/22 3,047,984
4,210,000 U.S. Treasury Bonds 7.13 02/15/23 4,670,448
7,090,000 U.S. Treasury Bonds 6.25 08/15/23 7,134,313
3,370,000 U.S. Treasury Bonds 7.50 11/15/24 3,919,714
4,020,000 U.S. Treasury Bonds 7.63 02/15/25 4,741,067
3,920,000 U.S. Treasury Bonds 6.88 08/15/25 4,261,746
3,980,000 U.S. Treasury Bonds 6.00 02/15/26 3,890,450
2,710,000 U.S. Treasury Bonds 6.75 08/15/26 2,912,383
2,270,000 U.S. Treasury Bonds 6.50 11/15/26 2,367,882
2,420,000 U.S. Treasury Bonds 6.63 02/15/27 2,565,950
3,360,000 U.S. Treasury Bonds 6.38 08/15/27 3,455,525
6,910,000 U.S. Treasury Bonds 6.13 11/15/27 6,888,372
2,320,000 U.S. Treasury Bonds 5.50 08/15/28 2,127,857
3,520,000 U.S. Treasury Bonds 5.25 11/15/28 3,115,200
2,020,000 U.S. Treasury Bonds 5.25 02/15/29 1,792,104
2,120,000 U.S. Treasury Bonds 6.13 08/15/29 2,143,044
2,500,000 U.S. Treasury Bonds 6.25 05/15/30 2,624,200
$ 90,710,179
-------------
TOTAL U.S. TREASURY OBLIGATIONS 98,053,984
(Cost $96,881,483)
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $234,025,546)* 99.41% $259,206,886
Other Assets and Liabilities, Net 0.59 1,528,314
------ ------------
TOTAL NET ASSETS 100.00% $260,735,200
====== ============
</TABLE>
--------------------------------------------------------------------------------
+ Non-income earning securities.
++ Yield to Maturity.
@ Securities pledged as collateral for Futures transactions.
* Cost for federal income tax purposes is the same as for financial statement
purposes and net unrealized appreciation consists of:
<TABLE>
<S> <C> <C>
Gross Unrealized Appreciation $ 40,699,873
Gross Unrealized Depreciation (15,518,533)
------------
NET UNREALIZED APPRECIATION $ 25,181,340
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
46
<PAGE> 48
WELLS FARGO VARIABLE TRUST CORPORATE BOND FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
CORPORATE BONDS & NOTES--66.21%
AMUSEMENT & RECREATION SERVICES--0.71%
$ 250,000 Hollywood Park Incorporated 9.25% 02/15/07 $ 248,750
250,000 Park Place Entertainment 9.38 02/15/07 250,000
-------------
$ 498,750
BUILDING CONSTRUCTION-GENERAL CONTRACTORS & OPERATIVE
BUILDERS--0.35%
250,000 D.R. Horton Incorporated 10.00% 04/15/06 $ 246,875
BUSINESS SERVICES--2.02%
270,000 Cendant Corporation 7.75% 12/01/03 $ 260,888
500,000 First Data Corporation 6.38 12/15/07 473,125
700,000 Oracle Corporation 6.72 02/15/04 686,000
-------------
$ 1,420,013
CHEMICALS & ALLIED PRODUCTS--4.01%
460,000 American Home Products Corporation 7.25% 03/01/23 $ 438,725
375,000 Georgia Gulf Corporation 10.38 11/01/07 390,000
250,000 Huntsman ICI Chemicals (Euro)(a) 10.13 07/01/09 250,288
375,000 ICN Pharmaceuticals Incorporated 9.25 08/15/05 371,250
250,000 Lyondell Chemical Company 9.63 05/01/07 246,250
1,250,000 Merck & Company Incorporated 6.40 03/01/28 1,126,562
-------------
$ 2,823,075
COMMUNICATIONS--5.24%
250,000 Adelphia Communications 9.38% 11/15/09 $ 231,250
250,000 Adelphia Communications 9.88 03/01/07 239,375
250,000 Charter Communications Holdings Limited Liability
Corporation 8.63 04/01/09 219,688
500,000 Charter Communications Holdings Limited Liability
Corporation 11.75+ 01/15/10 284,375
450,000 Clear Channel Communications Incorporated 7.25 10/15/27 400,500
500,000 CSC Holdings Incorporated 9.25 11/01/05 503,125
500,000 LCI International Incorporated (Qwest) 7.25 06/15/07 480,625
500,000 Sprint Capital Corporation 6.13 11/15/08 445,625
875,000 WorldCom Incorporated 8.00 05/15/06 884,843
-------------
$ 3,689,406
DEPOSITORY INSTITUTIONS--8.67%
500,000 Bank United 8.00% 03/15/09 $ 444,375
500,000 BankBoston Corporation 6.88 07/15/03 490,625
500,000 Bankers Trust New York Company 7.38 05/01/08 481,875
2,500,000 Chase Manhattan Corporation 7.00 11/15/09 2,359,374
750,000 HSBC USA 6.63 03/01/09 690,938
500,000 PNC Bank Corporation 6.50 05/01/08 460,000
700,000 Popular North American 6.63 01/15/04 672,585
500,000 Society Corporation 8.13 06/15/02 505,000
-------------
$ 6,104,772
</TABLE>
47
<PAGE> 49
WELLS FARGO VARIABLE TRUST CORPORATE BOND FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
ELECTRIC, GAS & SANITARY SERVICES--3.88%
$ 250,000 Allied Waste North America 7.88% 01/01/09 $ 213,125
2,000,000 NRG Energy Incorporated 8.00 11/01/03 1,987,500
600,000 Republic Services Incorporated 7.13 05/15/09 531,750
-------------
$ 2,732,375
FABRICATED METAL PRODUCTS, EXCEPT MACHINERY & TRANSPORTATION
EQUIPMENT--0.72%
500,000 Lockheed Martin Corporation 8.50% 12/01/29 $ 509,375
FINANCIAL SERVICES--1.86%
1,350,000 Washington Mutual Incorporated 7.50% 08/15/06 $ 1,311,187
FOOD & KINDRED PRODUCTS--2.88%
1,142,000 Anheuser-Busch Companies 9.00% 12/01/09 $ 1,263,338
500,000 Canandaigua Brands 8.63 08/01/06 493,750
250,000 International Home Foods 10.38 11/01/06 267,500
-------------
$ 2,024,588
FOOD STORES--0.36%
270,000 Marsh Supermarket Incorporated 8.88% 08/01/07 $ 251,100
FURNITURE & FIXTURES--0.52%
375,000 Lear Corporation 8.25% 02/01/02 $ 367,500
GENERAL MERCHANDISE STORES--0.53%
500,000 Saks Incorporated 7.38% 02/15/19 $ 371,250
HEALTH SERVICES--0.34%
250,000 Tenet Healthcare Corporation 8.63% 01/15/07 $ 238,750
HOLDING & OTHER INVESTMENT OFFICES--3.47%
1,750,000 ERP Operating Limited Partnership 7.95% 04/15/02 $ 1,747,813
750,000 Spieker Properties Limited Partnership 7.25 05/01/09 698,437
-------------
$ 2,446,250
HOTELS, ROOMING HOUSES, CAMPS & OTHER LODGING PLACES--0.51%
375,000 Station Casinos 8.88% 12/01/08 $ 357,188
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--2.51%
1,050,000 Dell Computer Corporation 7.10% 04/15/28 $ 938,437
825,000 Hewlett-Packard Company 7.15 06/15/05 828,005
-------------
$ 1,766,442
INDUSTRIAL SERVICES--0.24%
200,000 Gruma SA de CV 7.63% 10/15/07 $ 170,750
INSURANCE CARRIERS--1.10%
700,000 AMBAC Incorporated 9.38% 08/01/11 $ 777,000
</TABLE>
48
<PAGE> 50
WELLS FARGO VARIABLE TRUST CORPORATE BOND FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
MISCELLANEOUS RETAIL--0.66%
$ 500,000 Staples Incorporated 7.13% 08/15/07 $ 466,250
NONDEPOSITORY CREDIT INSTITUTIONS--6.44%
1,350,000 Countrywide Home Loan 6.25% 04/15/09 $ 1,179,561
500,000 Ford Motor Credit Company 5.13 10/15/01 486,875
1,000,000 Ford Motor Credit Company 7.38 10/28/09 967,500
185,000 General Electric Capital Corporation 7.88 12/01/06 190,088
1,592,000 General Electric Capital Corporation 8.63 06/15/08 1,707,420
-------------
$ 4,531,444
OIL & GAS EXTRACTION--2.85%
700,000 Canadian Occidental Petroleum 7.13% 02/04/04 $ 686,875
150,000 Gulf Canada Resource 9.25 01/15/04 150,750
700,000 Kerr-McGee Corporation 8.13 10/15/05 714,875
100,000 Ocean Energy Incorporated 8.88 07/15/07 99,500
100,000 Pioneer Natural Resources 9.63 04/01/10 103,250
150,000 Snyder Oil Corporation 8.75 06/15/07 150,750
100,000 Vintage Petroleum Incorporated 9.00 12/15/05 99,500
-------------
$ 2,005,500
PAPER & ALLIED PRODUCTS--1.83%
500,000 Kappa Beheer BV (Euro)(a) 10.88%+ 07/15/09 $ 306,058
500,000 Playtex Family Products Corporation 9.00 12/15/03 483,750
125,000 Playtex Family Products Corporation 8.88 07/15/04 120,625
375,000 Tembec Finance Corporation 9.88 09/30/05 376,875
-------------
$ 1,287,308
PETROLEUM REFINING & RELATED INDUSTRIES--3.18%
1,430,000 Amoco Company 6.50% 08/01/07 $ 1,374,588
200,000 Atlantic Richfield Company 9.00 04/01/21 231,500
500,000 Coastal Corporation 6.95 06/01/28 441,875
200,000 Tosco Corporation 7.80 01/01/27 190,500
-------------
$ 2,238,463
PRINTING & PUBLICATIONS--0.52%
375,000 Hollinger International Publishing 9.25% 03/15/07 $ 369,375
PRINTING, PUBLISHING & ALLIED INDUSTRIES--0.37%
255,000 News America Holdings 8.88% 04/26/23 $ 261,375
REAL ESTATE--0.72%
500,000 Rouse Company 8.50% 01/15/03 $ 505,625
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--5.37%
2,000,000 Lehman Brothers Holdings 7.00% 05/15/03 $ 1,952,500
2,000,000 Goldman Sachs Group Incorporated 6.65 05/15/09 1,832,500
-------------
$ 3,785,000
TRANSPORTATION BY AIR--1.76%
1,363,444 Continental Airlines 6.54% 02/02/19 $ 1,240,857
</TABLE>
49
<PAGE> 51
WELLS FARGO VARIABLE TRUST CORPORATE BOND FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
TRANSPORTATION EQUIPMENT--1.90%
$1,350,000 General Motors Acceptance Corporation 7.75% 01/19/10 $ 1,339,874
TRANSPORTATION SERVICES--0.18%
125,000 CB Bus AB (Euro)(a) 11.00% 02/15/10 $ 124,017
WHOLESALE TRADE-DURABLE GOODS--0.51%
375,000 Russel Metals Incorporated 10.00% 06/01/09 $ 356,719
TOTAL CORPORATE BONDS & NOTES
(Cost $47,369,181) $ 46,618,453
MUNICIPAL SECURITIES--0.28%
MUNICIPAL NOTES--0.28%
200,000 Denver Colorado City and County School District #1
Educational Facilities Revenue Bonds Taxable Pension School
Facilities Lease AMBAC insured 6.49% 12/15/02 $ 196,750
TOTAL MUNICIPAL SECURITIES
(Cost $199,814) $ 196,750
U.S. GOVERNMENT AGENCY SECURITIES--3.05%
FEDERAL HOME LOAN MORTGAGE CORPORATION--0.43%
300,000 FHLMC 7.10% 04/10/07 $ 300,444
FEDERAL NATIONAL MORTGAGE ASSOCIATION--2.40%
465,907 FNMA #449466 6.50% 11/01/28 $ 439,118
453,096 FNMA #454390 6.00 12/01/28 414,438
918,498 FNMA #455607 6.00 12/01/28 840,132
-------------
$ 1,693,688
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION--0.22%
154,643 GNMA #445071 7.50% 01/15/27 $ 153,531
TOTAL U.S. GOVERNMENT AGENCY SECURITIES
(Cost $2,197,976) $ 2,147,663
U.S. TREASURY SECURITIES--28.84%
U.S. TREASURY BONDS--9.70%
200,000 U.S. Treasury Bonds 11.25% 02/15/15 $ 294,374
300,000 U.S. Treasury Bonds 8.88 02/15/19 385,311
500,000 U.S. Treasury Bonds 8.13 08/15/19 603,125
500,000 U.S. Treasury Bonds 8.13 08/15/21 609,685
750,000 U.S. Treasury Bonds 5.25 11/15/28 663,750
4,250,000 U.S. Treasury Bonds 5.25 02/15/29 3,770,515
500,000 U.S. Treasury Bonds 6.13 08/15/29 505,435
-------------
$ 6,832,195
</TABLE>
50
<PAGE> 52
WELLS FARGO VARIABLE TRUST CORPORATE BOND FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
U.S. TREASURY NOTES--19.14%
$ 750,000 U.S. Treasury Notes 5.75% 11/30/02 $ 738,728
2,475,000 U.S. Treasury Notes 5.88 11/15/04 2,436,365
1,200,000 U.S. Treasury Notes 7.88 11/15/04 1,269,816
2,400,000 U.S. Treasury Notes 6.75 05/15/05 2,456,232
2,200,000 U.S. Treasury Notes 6.50 08/15/05 2,223,364
400,000 U.S. Treasury Notes 6.63 05/15/07 408,248
250,000 U.S. Treasury Notes 6.13 08/15/07 248,515
3,575,000 U.S. Treasury Notes 6.50 02/15/10 3,691,080
-------------
$ 13,472,348
TOTAL U.S. TREASURY SECURITIES
(Cost $20,017,657) $ 20,304,543
SHORT-TERM INVESTMENTS--1.15%
REPURCHASE AGREEMENTS--1.15%
807,000 Goldman Sachs Repurchase Agreement
--102% Collateralized by U.S. Government Securities 6.57% 07/03/00 $ 807,000
TOTAL SHORT-TERM INVESTMENTS (Cost $807,000) $ 807,000
TOTAL INVESTMENTS IN SECURITIES (Cost $70,591,627)* 99.53% $ 70,074,409
Other Assets and Liabilities, Net 0.47 327,991
------- -------------
TOTAL NET ASSETS 100.00% $ 70,402,400
======= =============
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<C> <S>
+ Yield to Maturity.
(a) Foreign bond principal is denominated in U.S. dollars except
as indicated parenthetically.
* Cost for federal income tax purposes is the same as for
financial statement purposes and net unrealized depreciation
consists of:
</TABLE>
<TABLE>
<S> <C> <C>
Gross Unrealized Appreciation $ 530,969
Gross Unrealized Depreciation (1,048,187)
------------
NET UNREALIZED DEPRECIATION $ (517,218)
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
51
<PAGE> 53
WELLS FARGO VARIABLE TRUST EQUITY INCOME FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--99.57%
BUSINESS SERVICES--1.73%
103,200 IMS Health Incorporated $ 1,857,600
CHEMICALS & ALLIED PRODUCTS--14.10%
55,600 American Home Products Corporation $ 3,266,500
45,090 E.I. du Pont de Nemours & Company 1,972,687
35,360 Merck & Company Incorporated 2,709,460
77,440 Pfizer Incorporated 3,717,120
35,650 Procter & Gamble Company 2,040,962
41,394 Rohm & Haas Company 1,428,093
------------
$ 15,134,822
COMMUNICATIONS--4.42%
79,397 AT&T Corporation $ 2,510,930
35,860 GTE Corporation 2,232,285
------------
$ 4,743,215
DEPOSITORY INSTITUTIONS--3.32%
20,465 J.P. Morgan & Company Incorporated $ 2,253,708
68,280 U.S. Bancorp 1,314,390
------------
$ 3,568,098
EATING & DRINKING PLACES--1.64%
53,450 McDonald's Corporation $ 1,760,509
ELECTRIC, GAS & SANITARY SERVICES--3.05%
31,830 Public Service Enterprise Group Incorporated $ 1,102,114
73,603 Texas Utilities Company 2,171,288
------------
$ 3,273,402
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS, EXCEPT
COMPUTER EQUIPMENT--10.29%
46,170 Emerson Electric Company $ 2,787,514
72,480 General Electric Company 3,841,440
74,660 Lucent Technologies Incorporated 4,423,605
------------
$ 11,052,559
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT & RELATED
SERVICES--1.97%
73,870 Dun & Bradstreet Corporation $ 2,114,530
FABRICATED METAL PRODUCTS, EXCEPT MACHINERY & TRANSPORTATION
EQUIPMENT--1.92%
89,670 Fortune Brands Incorporated $ 2,068,014
FOOD & KINDRED PRODUCTS--6.24%
112,440 PepsiCo Incorporated $ 4,996,553
88,200 Sara Lee Corporation 1,703,362
------------
$ 6,699,915
</TABLE>
52
<PAGE> 54
WELLS FARGO VARIABLE TRUST EQUITY INCOME FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
GENERAL MERCHANDISE STORES--5.73%
50,865 J.C. Penney Company Incorporated $ 937,824
72,957 May Department Stores Company 1,750,968
33,080 Sears Roebuck & Company 1,079,235
41,070 Target Corporation 2,382,060
------------
$ 6,150,087
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--8.04%
38,450 Hewlett-Packard Company $ 4,801,444
35,000 IBM Corporation 3,834,687
------------
$ 8,636,131
INSURANCE CARRIERS--7.14%
60,093 Aegon NV ADR $ 2,140,813
32,470 American General Corporation 1,980,670
103,840 St. Paul Companies Incorporated 3,543,540
------------
$ 7,665,023
MEASURING, ANALYZING & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS--3.43%
15,618 Agilent Technologies Incorporated+ $ 1,151,828
26,835 Eastman Kodak Company 1,596,682
45,000 Xerox Corporation 933,750
------------
$ 3,682,260
MISCELLANEOUS MANUFACTURING INDUSTRIES--3.56%
80,768 Tyco International Limited $ 3,826,382
MOTION PICTURES--1.27%
35,000 Walt Disney Company $ 1,358,438
NONDEPOSITORY CREDIT INSTITUTIONS--2.58%
53,070 American Express Company $ 2,766,274
OIL & GAS EXTRACTION--1.97%
28,310 Schlumberger Limited $ 2,112,634
PAPER & ALLIED PRODUCTS--2.02%
26,332 Minnesota Mining and Manufacturing Company $ 2,172,390
PETROLEUM REFINING & RELATED INDUSTRIES--7.77%
39,459 BP Amoco PLC ADR $ 2,231,900
19,625 Chevron Corporation 1,664,445
41,157 Exxon Mobil Corporation 3,230,825
19,760 Royal Dutch Petroleum Company--NY Registered Shares 1,216,475
------------
$ 8,343,645
TOBACCO PRODUCTS--1.46%
59,220 Philip Morris Companies Incorporated $ 1,573,031
</TABLE>
53
<PAGE> 55
WELLS FARGO VARIABLE TRUST EQUITY INCOME FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
TRANSPORTATION EQUIPMENT--3.42%
50,783 Honeywell Incorporated $ 1,710,752
33,280 United Technologies Corporation 1,959,360
------------
$ 3,670,112
WHOLESALE TRADE-DURABLE GOODS--2.50%
26,310 Johnson & Johnson $ 2,680,332
TOTAL COMMON STOCK
(Cost $99,558,742) $106,909,403
</TABLE>
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL RATE DATE
<C> <S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS--0.28%
$301,619 Bear Stearns & Company Incorporated
(Cost $301,619) 6.86% 07/03/00 $ 301,619
TOTAL INVESTMENTS IN SECURITIES
(Cost $99,860,361)* 99.85% $107,211,022
Other Assets and Liabilities, Net 0.15 166,296
----- ------------
TOTAL NET ASSETS 100.00% $107,377,318
====== ============
</TABLE>
<TABLE>
<C> <S> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------
+ Non-income earning securities.
* Cost for federal income tax purposes is the same as for financial statement purposes and net unrealized appreciation
consists of:
Gross Unrealized Appreciation $ 20,020,633
Gross Unrealized Depreciation (12,669,972)
------------
NET UNREALIZED APPRECIATION $ 7,350,661
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
54
<PAGE> 56
WELLS FARGO VARIABLE TRUST EQUITY VALUE FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--93.64%
BUILDING MATERIALS, HARDWARE, GARDEN SUPPLY & MOBILE HOME
DEALERS--0.47%
6,700 Sherwin-Williams Company $ 141,956
CHEMICALS & ALLIED PRODUCTS--5.72%
5,450 American Home Products Corporation $ 320,187
7,100 Clorox Company 318,169
3,950 Dow Chemical Company 119,241
3,850 E.I. du Pont de Nemours & Company 168,437
6,200 Teva Pharmaceutical Industries Limited ADR 343,712
8,300 Watson Pharmaceuticals Incorporated+ 446,125
-----------
$ 1,715,871
COMMUNICATIONS--9.08%
4,300 AT&T Corporation $ 135,987
6,075 Bell Atlantic Corporation+ 308,686
6,725 BellSouth Corporation 286,653
2,775 GTE Corporation 172,744
10,350 MediaOne Group Incorporated+ 686,347
16,962 SBC Communications Incorporated 733,606
7,800 Sprint Corporation (FON Group) 397,800
-----------
$ 2,721,823
DEPOSITORY INSTITUTIONS--12.36%
5,750 Bank of America Corporation $ 247,250
7,600 Bank of New York Company Incorporated 353,400
15,775 Chase Manhattan Corporation 726,636
26,288 Citigroup Incorporated 1,583,852
7,750 Fifth Third Bancorp 490,187
8,400 Mellon Financial Corporation 306,075
-----------
$ 3,707,400
EATING & DRINKING PLACES--0.43%
3,900 McDonald's Corporation $ 128,456
ELECTRIC, GAS & SANITARY SERVICES--3.32%
9,675 Montana Power Company $ 341,648
15,700 Williams Companies Incorporated 654,494
-----------
$ 996,142
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS, EXCEPT
COMPUTER EQUIPMENT--7.69%
14,400 American Power Conversion Corporation+ $ 587,700
4,875 Eaton Corporation 326,625
14,144 Koninklijke (Royal) Philips Electronics NV--NY Shares 671,840
13,100 Molex Incorporated Class A 458,500
9,000 Motorola Incorporated 261,563
-----------
$ 2,306,228
</TABLE>
55
<PAGE> 57
WELLS FARGO VARIABLE TRUST EQUITY VALUE FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
FOOD & KINDRED PRODUCTS--2.10%
2,650 Anheuser-Busch Companies Incorporated $ 197,922
9,700 PepsiCo Incorporated 431,044
-----------
$ 628,966
FURNITURE & FIXTURES--0.86%
5,000 Johnson Controls Incorporated $ 256,563
GENERAL MERCHANDISE STORES--0.68%
3,500 Target Corporation $ 203,000
HEALTH SERVICES--1.07%
11,850 Tenet Healthcare Corporation $ 319,950
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--7.02%
5,400 Apple Computer Incorporated+ $ 282,825
9,650 Compaq Computer Corporation 246,678
2,400 Hewlett-Packard Company 299,700
6,250 IBM Corporation 684,766
2,625 Minnesota Mining and Manufacturing Company 216,563
6,350 United Technologies Corporation 373,856
-----------
$ 2,104,388
INSURANCE AGENTS, BROKERS & SERVICE--1.12%
3,225 Marsh & McLennan Cos. Incorporated $ 336,811
INSURANCE CARRIERS--8.32%
9,212 American International Group Incorporated $ 1,082,410
12,350 AXA Financial Incorporated 419,900
4,400 Chubb Corporation 270,600
1,900 CIGNA Corporation 177,650
9,750 Hartford Financial Services Group 545,391
-----------
$ 2,495,951
MEASURING, ANALYZING & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS--0.56%
1,912 General Motors Corporation--Class H+ $ 167,761
MISCELLANEOUS MANUFACTURING INDUSTRIES--1.81%
11,450 Tyco International Limited $ 542,444
MOTION PICTURES--2.42%
12,600 AT&T Corporation--Liberty Media Corporation+ $ 305,550
10,850 Walt Disney Company 421,116
-----------
$ 726,666
NONDEPOSITORY CREDIT INSTITUTIONS--2.72%
3,000 Federal Home Loan Mortgage Corporation $ 121,500
2,550 Federal National Mortgage Association 133,078
13,500 Household International Incorporated 561,094
-----------
$ 815,672
</TABLE>
56
<PAGE> 58
WELLS FARGO VARIABLE TRUST EQUITY VALUE FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
OIL & GAS EXTRACTION--3.51%
7,400 Anadarko Petroleum Corporation $ 364,913
6,450 Enron Corporation 416,025
5,100 Transocean Sedco Forex Incorporated+ 272,531
-----------
$ 1,053,469
PAPER & ALLIED PRODUCTS--2.22%
8,875 Bowater Incorporated $ 391,609
4,750 Kimberly-Clark Corporation 272,531
-----------
$ 664,140
PETROLEUM REFINING & RELATED INDUSTRIES--9.95%
3,400 Chevron Corporation $ 288,363
13,200 Coastal Corporation 803,550
14,750 Conoco Incorporated--Class B 362,297
19,477 Exxon Mobil Corporation 1,528,944
-----------
$ 2,983,154
PRIMARY METAL INDUSTRIES--0.42%
4,350 Alcoa Incorporated $ 126,150
PRINTING, PUBLISHING & ALLIED INDUSTRIES--0.61%
2,650 Viacom Incorporated--Class A+ $ 181,194
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--2.83%
10,200 Morgan Stanley Dean Witter $ 849,150
STONE, CLAY, GLASS & CONCRETE PRODUCTS--0.45%
2,350 Southdown Incorporated $ 135,713
TECHNOLOGY--1.56%
11,100 Cypress Semiconductor Corporation+ $ 468,975
TOBACCO PRODUCTS--1.17%
13,150 Philip Morris Companies Incorporated $ 349,297
TRANSPORTATION EQUIPMENT--3.15%
3,700 Ford Motor Company $ 159,100
6,950 General Dynamics Corporation 363,138
2,313 General Motors Corporation 134,282
6,650 TRW Incorporated 288,444
-----------
$ 944,964
WHOLESALE TRADE-DURABLE GOODS--0.02%
484 Visteon Corporation+ $ 5,874
TOTAL COMMON STOCK
(Cost $26,823,248) $28,078,128
</TABLE>
57
<PAGE> 59
WELLS FARGO VARIABLE TRUST EQUITY VALUE FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS--6.34%
$ 608,000 Goldman Sachs Pooled Repurchase
Agreement-102% Collateralized by U.S.
Government Securities 6.57% 07/03/00 608,000
1,294,000 J.P. Morgan Securities Incorporated
Repurchase Agreement-102% Collateralized
by U.S. Government Securities 6.58% 07/03/00 1,294,000
TOTAL SHORT-TERM INVESTMENTS
(Cost $1,902,000) $ 1,902,000
TOTAL INVESTMENTS IN SECURITIES
(Cost $28,725,248)* 99.98% $29,980,128
Other Assets and Liabilities, Net 0.02 7,129
----- -----------
TOTAL NET ASSETS 100.00% $29,987,257
====== ===========
</TABLE>
<TABLE>
<C> <S> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------------------------
+ Non-income earning securities.
* Cost for federal income tax purposes is the same as for financial statement purposes and net unrealized appreciation
consists of:
Gross Unrealized Appreciation $ 2,929,123
Gross Unrealized Depreciation (1,674,243)
-----------
NET UNREALIZED APPRECIATION $ 1,254,880
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
58
<PAGE> 60
WELLS FARGO VARIABLE TRUST GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--97.54%
APPAREL & ACCESSORY STORES--0.85%
8,500 Gap Incorporated $ 265,625
14,000 Kohl's Corporation+ 778,750
------------
$ 1,044,375
BUILDING MATERIALS, HARDWARE, GARDEN SUPPLY & MOBILE HOME
DEALERS--1.26%
22,950 Home Depot Incorporated $ 1,146,066
9,750 Lowe's Company Incorporated 400,359
------------
$ 1,546,425
BUSINESS SERVICES--6.15%
22,472 America Online Incorporated+ $ 1,185,398
16,400 Interpublic Group Companies Incorporated 705,200
31,100 Oracle Systems Corporation+ 2,614,344
16,164 Sun Microsystems Incorporated+ 1,469,914
14,000 Veritas Software Corporation+ 1,582,218
------------
$ 7,557,074
CHEMICALS & ALLIED PRODUCTS--11.20%
15,751 Abbott Laboratories $ 701,904
15,264 Amgen Incorporated+ 1,072,296
15,000 Clorox Company 672,188
24,100 Colgate-Palmolive Company 1,442,988
3,250 Genentech Incorporated+ 559,000
22,288 Gillette Company 778,687
15,388 Lilly (Eli) & Company 1,536,876
16,067 Merck & Company Incorporated 1,231,134
80,687 Pfizer Incorporated 3,872,975
14,000 Praxair Incorporated 524,125
10,472 Procter & Gamble Company 599,522
15,290 Schering-Plough Corporation 772,145
------------
$ 13,763,840
COMMUNICATIONS--8.43%
24,000 360networks Incorporated+ $ 366,000
14,223 AT&T Corporation 449,802
20,800 AT&T Wireless Group+ 579,800
28,276 Bell Atlantic Corporation+ 1,436,774
12,000 Clear Channel Communications Incorporated+ 900,000
24,398 GTE Corporation 1,518,775
8,400 Nextel Communications Incorporated+ 513,975
4,000 NEXTLINK Communications Incorporated+ 151,750
15,000 Qwest Communications International Incorporated+ 745,313
45,652 SBC Communications Incorporated 1,974,449
7,178 Sprint Corporation (FON Group) 366,078
29,500 Worldcom Incorporated+ $ 1,353,313
------------
$ 10,356,029
COMPUTERS--3.54%
54,323 Microsoft Corporation+ $ 4,345,840
</TABLE>
59
<PAGE> 61
WELLS FARGO VARIABLE TRUST GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
DOMESTIC DEPOSITORY INSTITUTIONS--4.18%
37,371 Chase Manhattan Corporation $ 1,721,402
51,507 Citigroup Incorporated 3,103,296
5,000 Fifth Third Bancorp 316,250
------------
$ 5,140,948
EATING & DRINKING PLACES--0.50%
18,500 McDonald's Corporation $ 609,344
ELECTRIC, GAS & SANITARY SERVICES--2.46%
46,800 AES Corporation+ $ 2,135,250
14,518 Edison International 297,619
14,190 Williams Companies Incorporated 591,546
------------
$ 3,024,415
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS,
EXCEPT COMPUTER EQUIPMENT--16.21%
2,000 Broadcom Corporation+ $ 437,875
9,000 Celestica Incorporated+ 446,625
105,741 General Electric Company 5,604,272
35,576 Intel Corporation 4,756,067
33,443 Lucent Technologies Incorporated 1,981,498
9,550 Network Appliance Incorporated+ 768,775
40,946 Nortel Networks Corporation 2,794,565
2,000 PMC-Sierra Incorporated+ 355,375
9,000 Sanmina Corporation+ 769,500
29,154 Texas Instruments Incorporated 2,002,515
------------
$ 19,917,067
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT & RELATED
SERVICES--0.25%
6,500 Halliburton Company $ 306,719
FOOD & KINDRED PRODUCTS--2.77%
13,500 Anheuser-Busch Incorporated $ 1,008,281
28,260 Coca-Cola Company 1,623,184
17,400 PepsiCo Incorporated 773,213
------------
$ 3,404,678
GENERAL MERCHANDISE STORES--3.80%
30,460 Target Corporation $ 1,766,680
50,352 Wal-Mart Stores Incorporated 2,901,534
------------
$ 4,668,214
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--12.01%
18,000 Applied Materials Incorporated+ $ 1,631,250
99,510 Cisco Systems Incorporated+ 6,325,104
38,796 EMC Corporation+ 2,984,867
11,249 Hewlett-Packard Company 1,404,719
20,212 International Business Machines Corporation 2,214,477
3,600 Symbol Technologies Incorporated 194,400
------------
$ 14,754,817
INSURANCE AGENTS, BROKERS & SERVICE--0.43%
5,000 Marsh & McLennan Companies Incorporated $ 522,188
</TABLE>
60
<PAGE> 62
WELLS FARGO VARIABLE TRUST GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
INSURANCE CARRIERS--3.12%
25,564 American International Group Incorporated $ 3,003,770
15,000 AXA Financial Incorporated 510,000
9,500 St. Paul Companies Incorporated 324,188
------------
$ 3,837,958
MEASURING, ANALYZING, & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC,
MEDICAL & OPTICAL GOODS--2.55%
19,167 Baxter International Incorporated $ 1,347,679
11,744 Danaher Corporation 580,594
7,650 JDS Uniphase Corporation+ 917,044
5,862 Medtronic Incorporated 292,001
------------
$ 3,137,318
MISCELLANEOUS MANUFACTURING INDUSTRIES--1.25%
32,300 Tyco International Limited $ 1,530,213
MISCELLANEOUS RETAIL--0.24%
8,000 Bed Bath & Beyond Incorporated+ $ 290,000
MOTION PICTURES--1.49%
11,400 Time Warner Incorporated $ 866,400
24,900 Walt Disney Company 966,431
------------
$ 1,832,831
NONDEPOSITORY CREDIT INSTITUTIONS--2.20%
26,169 Federal National Mortgage Association $ 1,365,695
32,281 Household International Incorporated 1,341,679
------------
$ 2,707,374
OIL & GAS EXTRACTION--0.50%
5,600 Schlumberger Limited $ 417,900
3,761 Transocean Sedco Forex Incorporated+ 200,978
------------
$ 618,878
PAPER & ALLIED PRODUCTS--0.62%
16,000 International Paper Company $ 477,000
5,000 Kimberly-Clark Corporation 286,875
------------
$ 763,875
PETROLEUM REFINING & RELATED INDUSTRIES--5.17%
9,700 Coastal Corporation $ 590,488
10,245 Chevron Corporation 868,904
23,602 Conoco Incorporated Class B 579,724
40,009 Exxon Mobil Corporation 3,140,707
18,908 Royal Dutch Petroleum Company ADR 1,164,023
------------
$ 6,343,846
PRIMARY METAL INDUSTRIES--0.90%
38,000 Alcoa Incorporated $ 1,102,000
PRINTING, PUBLISHING & ALLIED INDUSTRIES--0.45%
8,137 Viacom Incorporated Class B+ $ 554,842
</TABLE>
61
<PAGE> 63
WELLS FARGO VARIABLE TRUST GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--1.44%
14,967 Charles Schwab Corporation $ 503,265
6,500 Merrill Lynch & Company Incorporated 747,500
6,204 Morgan Stanley Dean Witter & Company 516,483
------------
$ 1,767,248
STONE, CLAY, GLASS & CONCRETE PRODUCTS--0.44%
2,000 Corning Incorporated $ 539,750
TRANSPORTATION EQUIPMENT--1.77%
44,078 Honeywell International Incorporated $ 1,484,878
11,800 United Technologies Corporation 694,725
------------
$ 2,179,603
WHOLESALE TRADE-DURABLE GOODS--1.36%
16,373 Johnson & Johnson $ 1,667,999
TOTAL COMMON STOCK $119,835,708
(Cost $89,293,890)
UNIT INVESTMENT TRUST--1.01%
8,500 Standard and Poor's Depository Receipts $ 1,234,891
(Cost $1,259,338)
</TABLE>
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL RATE DATE
<C> <S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS--1.21%
$ 260,000 Goldman Sachs Repurchase Agreement
--102% Collateralized by U.S. Government
Securities 6.57% 07/03/00 $ 260,000
1,222,000 J.P. Morgan Securities Repurchase Agreement--102%
Collateralized by U.S. Government Securities 6.58% 07/03/00 1,222,000
TOTAL SHORT-TERM INVESTMENTS
(Cost $1,482,000) $ 1,482,000
TOTAL INVESTMENTS IN SECURITIES
(Cost $92,035,228)* 99.76% $122,552,599
Other Assets and Liabilities, Net 0.24 300,653
----- ------------
TOTAL NET ASSETS 100.00% $122,853,252
------ ------------
------ ------------
</TABLE>
--------------------------------------------------------------------------------
+ Non-income earning securities.
* Cost for federal income tax purposes is the same as for financial statement
purposes and net unrealized appreciation consists of:
<TABLE>
<S> <C> <C>
Gross Unrealized Appreciation $ 34,780,581
Gross Unrealized Depreciation (4,263,210)
------------
NET UNREALIZED APPRECIATION $ 30,517,371
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
62
<PAGE> 64
WELLS FARGO VARIABLE TRUST LARGE COMPANY GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--97.92%
BUILDING MATERIALS, HARDWARE, GARDEN SUPPLY & MOBILE HOME
DEALERS--4.87%
10,600 Fastenal Company $ 536,625
79,300 Home Depot Incorporated 3,960,044
-----------
$ 4,496,669
BUSINESS SERVICES--13.02%
26,100 America Online Incorporated+ $ 1,376,775
24,600 Automatic Data Processing Incorporated 1,317,638
14,000 DST Systems Incorporated+ 1,065,750
46,900 First Data Corporation 2,327,413
33,700 Fiserv Incorporated+ 1,457,525
92,400 IMS Health Incorporated 1,663,200
26,300 Oracle Corporation+ 2,210,843
19,000 Sungard Data Systems Incorporated+ 589,000
-----------
$12,008,144
CHEMICALS & ALLIED PRODUCTS--6.01%
115,550 Pfizer Incorporated $ 5,546,400
COMPUTERS--5.21%
60,100 Microsoft Corporation+ $ 4,808,000
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS,
EXCEPT COMPUTER EQUIPMENT--16.32%
61,600 Intel Corporation $ 8,235,150
74,700 Nokia Corporation ADR 3,730,331
154,900 Telefonaktiebolaget LM Ericsson Series B ADR 3,098,000
-----------
$15,063,481
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT & RELATED
SERVICES--3.07%
67,550 Paychex Incorporated $ 2,837,100
FINANCIAL--1.20%
10,400 State Street Corporation $ 1,103,050
FOOD & KINDRED PRODUCTS--1.43%
23,000 Coca-Cola Company $ 1,321,063
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--16.92%
114,300 Cisco Systems Incorporated+ $ 7,265,193
50,600 EMC Corporation+ 3,893,038
106,450 Solectron Corporation+ 4,457,594
-----------
$15,615,825
INSURANCE CARRIERS--4.61%
36,250 American International Group Incorporated $ 4,259,375
</TABLE>
63
<PAGE> 65
WELLS FARGO VARIABLE TRUST LARGE COMPANY GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
MEASURING, ANALYZING, & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS--5.55%
6,700 JDS Uniphase Corporation+ $ 803,162
86,775 Medtronic Incorporated 4,322,480
-----------
$ 5,125,642
MISCELLANEOUS RETAIL--2.85%
38,400 Costco Wholesale Corporation+ $ 1,267,200
88,700 Staples Incorporated+ 1,363,763
-----------
$ 2,630,963
OIL & GAS EXTRACTION--0.75%
9,300 Schlumberger Limited $ 694,013
PERSONAL SERVICES--1.63%
41,100 Cintas Corporation $ 1,507,856
PHARMACEUTICAL PREPARATIONS--1.89%
22,800 Merck & Company Incorporated $ 1,747,050
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--11.30%
134,050 Charles Schwab Corporation $ 4,507,431
43,175 Goldman Sachs Group Incorporated 4,096,228
42,800 T. Rowe Price 1,819,000
-----------
$10,422,659
WHOLESALE TRADE-NONDURABLE GOODS--1.29%
16,100 Cardinal Health Incorporated $ 1,191,400
TOTAL COMMON STOCK
(Cost $74,910,587) $90,378,690
</TABLE>
64
<PAGE> 66
WELLS FARGO VARIABLE TRUST LARGE COMPANY GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
SHORT-TERM INVESTMENTS--4.88%
$4,503,285 Bear Stearns & Company Incorporated Repurchase Agreement
--102% Collateralized by U.S. Government Securities 6.86% 7/03/00 $ 4,503,285
(Cost $4,503,285)
TOTAL INVESTMENTS IN SECURITIES
(Cost $79,413,872)* 102.80% $ 94,881,975
Other Assets and Liabilities, Net (2.80) (2,584,959)
------ ------------
TOTAL NET ASSETS 100.00% $ 92,297,016
====== ============
</TABLE>
--------------------------------------------------------------------------------
+ Non-income earning securities.
* Cost for federal income tax purposes is the same as for financial statement
purposes and net unrealized appreciation consists of:
<TABLE>
<S> <C> <C>
Gross Unrealized Appreciation $ 18,815,085
Gross Unrealized Depreciation (3,346,982)
------------
NET UNREALIZED APPRECIATION $ 15,468,103
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
65
<PAGE> 67
WELLS FARGO VARIABLE TRUST MONEY MARKET FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
CERTIFICATES OF DEPOSIT--5.74%
$1,200,000 ABN Amro Bank Chicago 6.72 02/12/01 $ 1,199,791
500,000 Canadian Imperial Bank of Commerce 6.57 01/29/01 499,892
500,000 U.S. Bank 6.59 01/16/01 500,000
200,000 Union Bank of Switzerland 6.22 07/18/00 199,937
------------
TOTAL CERTIFICATES OF DEPOSIT (COST $2,399,620) $ 2,399,620
COMMERCIAL PAPER--56.58%
500,000 Ace Overseas Corporation 6.99** 12/04/00 $ 485,561
1,000,000 Australia & New Zealand Incorporated 6.28** 09/07/00 988,852
700,000 Bank of America Corporation 6.47** 08/24/00 693,256
750,000 Bank of America Corporation 6.79** 10/12/00 736,829
1,600,000 Citicorp 6.59** 07/07/00 1,598,836
1,500,000 Compass Securitization 6.70** 08/08/00 1,490,115
1,600,000 Conduit Asset Backed Securities Limited 6.64** 07/17/00 1,595,890
1,000,000 Halogen Capital Corporation Limited Liability Corporation 6.65** 07/17/00 997,426
383,000 International Securitization Corporation 6.61** 07/10/00 382,511
1,500,000 K2 (USA) Limited Liability Corporation 6.94** 09/25/00 1,476,270
1,600,000 Lexington Parker Capital Corporation 6.59** 07/06/00 1,599,127
500,000 MOAT Funding Limited Liability Corporation 6.93** 10/11/00 491,264
400,000 MOAT Funding Limited Liability Corporation 6.94** 12/04/00 388,502
500,000 MOAT Funding Limited Liability Corporation 6.95** 12/13/00 484,833
300,000 MOAT Funding Limited Liability Corporation 6.49** 12/14/00 290,844
1,500,000 Mont Blanc Capital Corporation 6.70** 08/04/00 1,491,213
1,200,000 National Rural Utilities Corporation 6.28** 09/22/00 1,183,585
1,600,000 Neptune Funding Corporation 6.61** 07/07/00 1,598,830
1,600,000 Prudential Funding Corporation 6.58** 07/10/00 1,597,965
900,000 Salomon Smith Barney Holdings 6.78** 08/17/00 892,508
1,600,000 Sydney Capital Corporation 6.68** 08/03/00 1,590,893
1,600,000 Thames Asset Global Securities 6.66** 07/18/00 1,595,587
------------
TOTAL COMMERCIAL PAPER $ 23,650,697
(Cost $23,650,697)
CORPORATE BONDS & NOTES--27.03%
1,500,000 Bear Stearns Company Incorporated++ 6.73 03/29/01 $ 1,500,000
1,000,000 Beta Finance Incorporated 6.15 10/06/00 1,000,000
500,000 Beta Finance Incorporated 6.82 02/15/01 500,000
900,000 Branch Banking & Trust 7.05 05/07/01 897,188
1,500,000 Comerica Bank++ 6.59 01/12/01 1,499,688
500,000 Commerzbank New York 6.77 02/28/01 499,905
1,500,000 Dorada Finance Incorporated 6.77 03/15/01 1,500,000
400,000 First USA Bank 5.99 09/21/00 399,974
1,500,000 J.P. Morgan & Company Incorporated++ 6.64 03/16/01 1,500,000
1,500,000 Morgan Stanley Dean Witter++ 6.63 03/16/01 1,500,000
500,000 Salomon Smith Barney 6.70 07/05/00 500,018
------------
TOTAL CORPORATE BONDS & NOTES $ 11,296,773
(Cost $11,296,773)
</TABLE>
66
<PAGE> 68
WELLS FARGO VARIABLE TRUST MONEY MARKET FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
REPURCHASE AGREEMENTS--2.39%
$1,000,000 Goldman Sachs & Company--102% Collateralized
by U.S. Government Securities (Cost $1,000,000) 7.05% 07/03/00 $ 1,000,000
TIME DEPOSITS--7.86%
1,783,231 Allied Irish Bank PLC 7.00% 07/03/00 $ 1,783,231
1,500,000 Banque Bruxelles Lambert London Branch 6.84% 07/05/00 1,500,000
------------
TOTAL TIME DEPOSITS $ 3,283,231
(Cost $3,283,231)
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $41,630,321)* 99.60% $41,630,321
Other Assets and Liabilities, Net 0.40 165,550
------ -----------
TOTAL NET ASSETS 100.00% $41,795,871
====== ===========
</TABLE>
--------------------------------------------------------------------------------
++ Variable rate securities.
** Yield to maturity.
* Cost for federal income tax purposes is the same as for financial statement
purposes and net unrealized appreciation consists of:
The accompanying notes are an integral part of these financial statements.
67
<PAGE> 69
WELLS FARGO VARIABLE TRUST SMALL CAP GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMON STOCK--96.38%
BUSINESS SERVICES--27.68%
8,850 Active Software Incorporated+ $ 687,534
6,818 Administaff Incorporated+ 432,943
6,711 Agile Software Corporation+ 474,384
8,559 Alteon Websystems Incorporated+ 856,435
8,300 AppNet Incorporated+ 298,800
7,911 Art Technology Group Incorporated+ 798,516
950 Breakaway Solutions Incorporated+ 25,650
4,125 CacheFlow Incorporated+ 253,945
6,800 Click Commerce Incorporated+ 153,850
3,350 Digital Island Incorporated+ 162,894
1,441 E.piphany Incorporated+ 154,457
19,225 eFunds Corporation+ 223,491
8,323 Entrust Technologies Incorporated+ 688,728
10,007 Getty Images Incorporated+ 370,884
300 Inforte Corporation+ 10,800
4,316 ISS Group Incorporated+ 426,138
850 Manugistics Group Incorporated+ 39,738
10,156 MatrixOne Incorporated+ 412,587
26 Mercator Software Incorporated+ 1,788
4,375 Mercury Interactive Corporation+ 423,281
8,897 Metasolv Software Incorporated+ 391,468
3,362 Micromuse Incorporated+ 556,358
11,381 Net Perceptions Incorporated+ 180,673
209 net.Genesis Corporation+ 3,775
5,648 NetIQ Corporation+ 336,762
1,000 Predictive Systems Incorporated+ 35,937
200 StorageNetworks Incorporated+ 18,050
12,893 TeleTech Holdings Incorporated+ 400,489
13,290 Verticalnet Incorporated+ 490,899
11,442 Viant Corporation+ 338,970
15,760 Vignette Corporation+ 819,766
-----------
$10,469,990
CHEMICALS & ALLIED PRODUCTS--9.70%
2,175 Abgenix Incorporated+ $ 260,694
3,604 Alkermes Incorporated+ 169,839
7,549 Alpharma Incorporated 469,925
6,801 Cambrex Corporation 306,045
4,754 Cubist Pharmaceuticals Incorporated+ 234,135
16,788 First Horizon Pharmaceutical Corporation+ 163,683
2,080 Gilead Sciences Incorporated+ 147,940
2,465 Incyte Genomics Incorporated+ 202,592
8,706 Jones Pharma Incorporated 347,696
15,057 King Pharmaceuticals Incorporated+ 660,626
8,446 Medicis Pharmaceutical Corporation+ 481,422
2,589 Pharmacyclics Incorporated+ 157,929
1,288 Shire Pharmaceuticals Group PLC+ 66,815
-----------
$ 3,669,341
</TABLE>
68
<PAGE> 70
WELLS FARGO VARIABLE TRUST SMALL CAP GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
COMMUNICATIONS--8.53%
2,979 AirGate PCS Incorporated+ $ 156,584
8,035 Allied Riser Communications Corporation+ 113,494
8,097 Dobson Communications Corporation+ 155,867
4,000 DSP Group Incorporated+ 224,000
9,316 Entercom Communications Corporation+ 454,155
14,290 Globix Corporation+ 418,876
4,859 Illuminet Holdings Incorporated+ 247,202
3,868 Intermedia Communications Inc+ 115,073
3,496 ITXC Corporation+ 123,780
5,520 MasTec Incorporated+ 210,795
3,448 MGC Communications Incorporated+ 206,681
5,945 SBA Communications Corporation+ 308,768
11,164 True North Communications Incorporated 491,216
-----------
$ 3,226,491
DEPOSITORY INSTITUTIONS--2.20%
4,750 Investors Financial Services Corporation $ 188,516
15,115 Silicon Valley Bancshares+ 644,277
-----------
$ 832,793
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT & COMPONENTS, EXCEPT
COMPUTER EQUIPMENT--15.21%
4,524 Advanced Fibre Communications Incorporated+ $ 204,994
5,601 Ancor Communications Incorporated+ 200,323
4,874 Burr-Brown Corporation+ 422,515
1,948 Capstone Turbine Corporation+ 87,782
9,625 CTC Communications Group Incorporated+ 346,500
7,731 Cypress Semiconductor Corporation+ 326,635
25 DDI Corporation+ 713
4,291 Digital Lightwave Incorporated+ 431,245
5,660 Digital Microwave Corporation+ 215,787
15,567 International FiberCom Incorporated+ 396,959
579 Manufacturers Services Limited+ 11,906
14,090 Micrel Incorporated+ 612,034
4,307 Netro Corporation+ 247,114
8,224 PLX Technology Incorporated+ 341,296
3,711 Semtech Corporation+ 283,834
2,350 Stratos Lightwave Incorporated+ 65,506
2,567 Technitrol Incorporated 248,678
6,527 Terayon Communication Systems Incorporated+ 419,258
2,102 Transwitch Corporation+ 162,248
10,546 Tut Systems Incorporated+ 605,077
7,612 Viasystems Group Incorporated+ 123,219
-----------
$ 5,753,623
</TABLE>
69
<PAGE> 71
WELLS FARGO VARIABLE TRUST SMALL CAP GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT & RELATED
SERVICES--5.01%
1,508 Affymetrix Incorporated+ $ 249,008
4,555 Cephalon Incorporated+ 272,731
10,051 Diamond Technology Partners Incorporated+ 884,488
4,366 Millennium Pharmaceuticals Incorporated+ 488,446
-----------
$ 1,894,673
GENERAL MERCHANDISE STORES--1.80%
11,162 99 Cents Only Stores+ $ 445,085
7,113 BJ's Wholesale Club Incorporated+ 234,729
-----------
$ 679,814
HEALTH SERVICES--1.25%
3,544 Human Genome Science Incorporated+ $ 472,681
HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES--0.42%
5,842 Linens 'N Things Incorporated+ $ 158,464
INDUSTRIAL & COMMERCIAL MACHINERY & COMPUTER
EQUIPMENT--4.44%
2,500 Advanced Digital Information Corporated+ $ 39,844
7,975 Asyst Technologies Incorporated+ 273,143
7,305 Infocus Corporation+ 235,130
11,528 Media 100 Incorporated+ 296,846
4,694 PRI Automation Incorporated+ 306,943
8,632 SanDisk Corporation+ 528,171
-----------
$ 1,680,077
INSURANCE AGENTS, BROKERS & SERVICE--0.93%
8,338 Arthur J. Gallagher & Corporation $ 350,196
INSURANCE CARRIERS--0.59%
9,425 Oxford Health Plans Incorporated+ $ 224,433
MEASURING, ANALYZING & CONTROLLING INSTRUMENTS;
PHOTOGRAPHIC, MEDICAL & OPTICAL GOODS--2.63%
625 Anaren Microwave Incorporated+ $ 82,021
3,591 Aspect Medical Systems Incorporated+ 96,957
2,251 Cerus Corporation+ 115,223
750 ClickSoftware Technologies Limited+ 5,250
200 Exfo Electro-Optical Engineering Incorporated+ 8,775
992 Keithley Instruments Incorporated 86,428
4,754 Newport Corporation 510,461
972 Zygo Corporation+ 88,270
-----------
$ 993,385
MISCELLANEOUS MANUFACTURING INDUSTRIES--0.69%
12,095 Yankee Candle Company Incorporated+ $ 261,554
MISCELLANEOUS RETAIL--1.70%
8,446 Michaels Stores Incorporated+ $ 386,932
13,054 Petco Animal Supplies Incorporated+ 256,185
-----------
$ 643,117
</TABLE>
70
<PAGE> 72
WELLS FARGO VARIABLE TRUST SMALL CAP GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
SHARES SECURITY NAME VALUE
<C> <S> <C>
NONDEPOSITORY CREDIT INSTITUTIONS--2.34%
12,487 AmeriCredit Corporation+ $ 212,279
8,385 CompuCredit Corporation+ 251,550
16,780 Metris Companies Incorporated 421,598
-----------
$ 885,427
OIL & GAS EXTRACTION--4.01%
6,707 Helmerich & Payne Incorporated $ 250,674
14,614 Louis Dreyfus Natural Gas Corporation+ 457,601
13,354 Marine Drilling Corporation Incorporated+ 373,912
5,692 Newfield Exploration Corporation+ 222,700
3,183 OSCA Incorporated+ 53,713
975 Syntroleum Corporation+ 16,697
3,528 UTI Energy Corporation+ 141,561
-----------
$ 1,516,858
PETROLEUM REFINING & RELATED INDUSTRIES--1.01%
12,065 Valero Energy Corporation $ 383,064
PRIMARY METAL INDUSTRIES--1.25%
11,552 CommScope Incorporated+ $ 473,632
SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES &
SERVICES--0.78%
7,377 SEI Investments Corporation $ 293,697
TRANSPORTATION SERVICES--1.11%
8,507 C.H. Robinson Worldwide Incorporated $ 421,097
WHOLESALE TRADE--DURABLE GOODS--2.50%
10,081 ACT Manufacturing Incorporated+ $ 468,136
5,186 Insight Enterprises Incorporated+ 307,595
5,749 Kent Electronics Corporation+ 171,392
-----------
$ 947,123
WHOLESALE TRADE--NONDURABLE GOODS--0.60%
6,876 National-Oilwell Incorporated+ $ 226,049
TOTAL COMMON STOCK
(Cost $31,920,006) $36,457,579
</TABLE>
71
<PAGE> 73
WELLS FARGO VARIABLE TRUST SMALL CAP GROWTH FUND--JUNE 30, 2000
<TABLE>
<CAPTION>
INTEREST MATURITY
PRINCIPAL SECURITY NAME RATE DATE VALUE
<C> <S> <C> <C> <C>
REPURCHASE AGREEMENTS--6.84%
$2,588,572 Bear Stearns and Company Repurchase Agreement
--102% Collateralized by U.S. Government Securities
(Cost $2,588,572) 6.86% 07/03/00 $ 2,588,572
</TABLE>
<TABLE>
<C> <S> <C> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $34,508,578)* 103.22% $39,046,151
Other Assets and Liabilities, Net (3.22) (1,218,641)
------ -----------
TOTAL NET ASSETS 100.00% $37,827,510
====== ===========
</TABLE>
--------------------------------------------------------------------------------
+ Non-income earning securities.
* Cost for federal income tax purposes is the same as for financial statement
purposes and net unrealized appreciation consists of:
<TABLE>
<S> <C> <C>
Gross Unrealized Appreciation $6,457,091
Gross Unrealized Depreciation (1,919,518)
----------
NET UNREALIZED APPRECIATION $4,537,573
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
72
<PAGE> 74
WELLS FARGO VARIABLE TRUST
STATEMENTS OF ASSETS AND LIABILITIES--JUNE 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
Large
Asset Corporate Equity Equity Company
Allocation Bond Income Value Growth Growth
Fund Fund Fund Fund Fund Fund
--------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
In securities, at market value
(see cost below) $259,206,886 $70,074,409 $107,211,022 $29,980,128 $122,552,599 $94,881,975
Cash 5,798 5,274 0 3,812 3,882 0
Receivable for dividends, interest
and other receivables 1,791,117 1,245,741 220,219 26,378 48,608 24,646
Receivable for investments sold 15,456 0 0 0 1,622,087 0
Receivable for Fund shares issued 85,300 29,856 64,712 45,961 7,545 201,102
Receivable from investment advisor
and affiliates 0 0 0 0 0 0
Variation margin on futures
contracts 42,925 0 0 0 0 0
Prepaid expenses and other assets 0 0 371 0 0 0
TOTAL ASSETS 261,147,482 71,355,280 107,496,324 30,056,279 124,234,721 95,107,723
LIABILITIES
Payable for investments purchased 132,098 0 0 0 532,855 2,644,634
Dividends payable 0 0 0 0 0 0
Payable for Fund shares redeemed 741 796,698 23,657 78 691,610 14,621
Payable to investment advisor and
affiliates 130,502 16,749 52,598 4,139 53,043 22,490
Payable to other related parties 119,722 36,205 32,017 28,022 58,531 87,327
Due to custodian 0 0 18 0 0 0
Accrued expenses and other
liabilities 29,219 59,926 10,716 36,783 45,430 41,635
Unrealized depreciation on forward
foreign currency contracts 0 43,302 0 0 0 0
TOTAL LIABILITIES 412,282 952,880 119,006 69,022 1,381,469 2,810,707
TOTAL NET ASSETS $260,735,200 $70,402,400 $107,377,318 $29,987,257 $122,853,252 $92,297,016
NET ASSETS CONSIST OF:
Paid-in capital $224,337,114 $72,167,042 $ 94,228,060 $31,525,545 $ 79,369,497 $77,086,745
Undistributed (overdistributed) net
investment income 85,188 18,058 29,231 4,519 1,712 (142,145)
Undistributed net realized gain
(loss) on investments 11,258,633 (1,222,307) 5,769,366 (2,797,687) 12,964,672 (115,687)
Net unrealized appreciation
(depreciation) of investments 25,181,340 (517,218) 7,350,661 1,254,880 30,517,371 15,468,103
Net unrealized appreciation
(depreciation) of foreign
currency 0 (43,175) 0 0 0 0
Net unrealized appreciation
(depreciation) of futures
contracts (127,075) 0 0 0 0 0
TOTAL NET ASSETS $260,735,200 $70,402,400 $107,377,318 $29,987,257 $122,853,252 $92,297,016
COMPUTATION OF NET ASSET VALUE AND
OFFERING PRICE
Net assets $260,735,200 $70,402,400 $107,377,318 $29,987,257 $122,853,252 $92,297,016
Shares outstanding 17,586,315 7,221,067 6,617,968 3,342,859 5,106,583 7,027,261
Net asset value and offering price $14.83 $9.75 $16.23 $8.97 $24.06 $13.13
INVESTMENTS AT COST $234,025,546 $70,591,627 $ 99,860,361 $28,725,248 $ 92,035,228 $79,413,872
--------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Money Small Cap
Market Growth
Fund Fund
<S> <C> <C>
ASSETS
Investments:
In securities, at market value
(see cost below) $41,630,321 $39,046,151
Cash 0 0
Receivable for dividends, interest
and other receivables 240,900 6,149
Receivable for investments sold 0 1,164,738
Receivable for Fund shares issued 0 24,665
Receivable from investment advisor
and affiliates 0 8,942
Variation margin on futures
contracts 0 0
Prepaid expenses and other assets 0 0
TOTAL ASSETS 41,871,221 40,250,645
LIABILITIES
Payable for investments purchased 0 2,168,764
Dividends payable 13,567 0
Payable for Fund shares redeemed 0 47,503
Payable to investment advisor and
affiliates 18,882 0
Payable to other related parties 16,762 84,276
Due to custodian 0 0
Accrued expenses and other
liabilities 26,139 122,592
Unrealized depreciation on forward
foreign currency contracts 0 0
TOTAL LIABILITIES 75,350 2,423,135
TOTAL NET ASSETS $41,795,871 $37,827,510
NET ASSETS CONSIST OF:
Paid-in capital $41,796,262 $28,164,848
Undistributed (overdistributed) net
investment income 0 (99,320)
Undistributed net realized gain
(loss) on investments (391) 5,224,409
Net unrealized appreciation
(depreciation) of investments 0 4,537,573
Net unrealized appreciation
(depreciation) of foreign
currency 0 0
Net unrealized appreciation
(depreciation) of futures
contracts 0 0
TOTAL NET ASSETS $41,795,871 $37,827,510
COMPUTATION OF NET ASSET VALUE AND
OFFERING PRICE
Net assets $41,795,871 $37,827,510
Shares outstanding 41,796,296 1,933,537
Net asset value and offering price $1.00 $19.56
INVESTMENTS AT COST $41,630,321 $34,508,578
-----------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
73
<PAGE> 75
WELLS FARGO VARIABLE TRUST
STATEMENTS OF OPERATIONS--FOR THE SIX MONTHS ENDED JUNE 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
Large
Asset Corporate Equity Equity Company
Allocation Bond Income Value Growth Growth
Fund Fund Fund Fund Fund Fund
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends $ 824,810 $ 0 $ 1,105,481 $ 192,124 $ 491,590 $ 122,933
Interest 3,349,490 2,656,121 45,864 58,239 121,970 107,982
TOTAL INVESTMENT INCOME 4,174,300 2,656,121 1,151,345 250,363 613,560 230,915
EXPENSES
Advisory fees 681,939 158,779 302,728 75,975 336,258 205,326
Administration fees 185,983 52,926 82,562 20,720 91,706 55,998
Portfolio accounting fees 42,156 34,579 30,823 37,987 33,626 58,985
Custody 0 7,057 11,008 2,763 12,228 7,466
Transfer agent 114,070 63,829 53,941 23,483 89,261 68,318
Distribution fees 309,972 88,210 137,604 34,534 152,844 93,330
Legal and audit fees 39,358 21,253 12,434 12,082 26,225 15,230
Registration fees 1,831 0 0 2,506 584 0
Directors' fees 2,809 2,809 2,809 2,809 2,809 2,809
Shareholder reports 7,157 1,664 4,925 1,461 3,345 9,867
Other 10,818 9,535 8,311 2,026 4,190 16,632
TOTAL EXPENSES 1,396,093 440,641 647,145 216,346 753,076 533,961
Less: Waived fees and reimbursed expenses (156,226) (123,107) (95,772) (78,047) (141,228) (160,901)
Net Expenses 1,239,867 317,534 551,373 138,299 611,848 373,060
NET INVESTMENT INCOME (LOSS) 2,934,433 2,338,587 599,972 112,064 1,712 (142,145)
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net Realized Gain (Loss) from:
Securities 4,004,597 (1,220,178) 3,897,947 (1,164,109) 2,399,961 (32,264)
Foreign currency 0 67,423 0 0 0 0
Financial futures contracts 43,748 0 0 0 0 0
NET REALIZED GAIN (LOSS) FROM INVESTMENTS 4,048,345 (1,152,755) 3,897,947 (1,164,109) 2,399,961 (32,264)
Net Change in Unrealized Appreciation
(Depreciation) of:
Securities 3,101,674 661,946 (10,523,030) 243,198 (2,763,254) 7,261,843
Foreign currency 0 (47,633) 0 0 0 0
Financial futures contracts (199,200) 0 0 0 0 0
Net Change in Unrealized Appreciation
(Depreciation) of Investments 2,902,474 614,313 (10,523,030) 243,198 (2,763,254) 7,261,843
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS 6,950,819 (538,442) (6,625,083) (920,911) (363,293) 7,229,579
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $9,885,252 $ 1,800,145 $ (6,025,111) $ (808,847) $ (361,581) $7,087,434
----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Money Small Cap
Market Growth
Fund Fund
------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME
Dividends $ 0 $ 17,583
Interest 1,229,041 69,586
TOTAL INVESTMENT INCOME 1,229,041 87,169
EXPENSES
Advisory fees 78,839 116,777
Administration fees 29,564 23,356
Portfolio accounting fees 37,054 69,288
Custody 3,942 3,114
Transfer agent 13,797 47,645
Distribution fees 0 38,926
Legal and audit fees 9,804 18,066
Registration fees 224 0
Directors' fees 2,809 2,809
Shareholder reports 643 10,080
Other 324 44,984
TOTAL EXPENSES 177,000 375,045
Less: Waived fees and reimbursed expenses (9,461) (188,556)
Net Expenses 167,539 186,489
NET INVESTMENT INCOME (LOSS) 1,061,502 (99,320)
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net Realized Gain (Loss) from:
Securities (391) 4,248,235
Foreign currency 0 0
Financial futures contracts 0 0
NET REALIZED GAIN (LOSS) FROM INVESTMENTS (391) 4,248,235
Net Change in Unrealized Appreciation
(Depreciation) of:
Securities 0 (2,357,393)
Foreign currency 0 0
Financial futures contracts 0 0
Net Change in Unrealized Appreciation
(Depreciation) of Investments 0 (2,357,393)
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS (391) 1,890,842
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $1,061,111 $1,791,522
------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
74
<PAGE> 76
WELLS FARGO VARIABLE TRUST
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Asset Allocation Fund Corporate Bond Fund
----------------------------- ---------------------------------
(Unaudited) (Unaudited) From
For the For the Sept. 20, 1999
Six Months For the Six Months (commencement
Ended Year Ended Ended of operations) to
June 30, 2000 Dec. 31, 1999 June 30, 2000 Dec. 31, 1999
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
BEGINNING NET ASSETS $240,670,990 $156,240,933 $68,423,018 $ 0
Operations:
Net investment income (loss) 2,934,433 4,046,849 2,338,587 1,146,179
Net realized gain (loss) on sale
of investments and foreign
currency 4,048,345 7,407,467 (1,152,755) (51,484)
Net change in unrealized
appreciation (depreciation) of
investments and translation of
foreign currency 2,902,474 6,276,920 614,313 (1,174,706)
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS 9,885,252 17,731,236 1,800,145 (80,011)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (2,986,255) (3,909,839) (2,338,587) (1,146,189)
Net realized gain on sale of
investments 0 (200,663) 0 0
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 17,291,669 71,043,067 8,398,752 70,873,232
Reinvestment of dividends 2,986,255 4,579,771 2,362,957 1,121,820
Cost of shares redeemed (7,112,711) (4,813,515) (8,243,885) (2,345,834)
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM CAPITAL
SHARE TRANSACTIONS 13,165,213 70,809,323 2,517,824 69,649,218
NET INCREASE (DECREASE) IN NET
ASSETS 20,064,210 84,430,057 1,979,382 68,423,018
NET ASSETS:
ENDING NET ASSETS $260,735,200 $240,670,990 $70,402,400 $68,423,018
SHARE ISSUED AND REDEEMED:
Shares sold 1,187,379 5,092,781 858,275 7,089,778
Shares issued in reinvestment of
dividends 199,016 329,334 242,387 113,155
Shares redeemed (488,756) (351,542) (846,281) (236,247)
NET INCREASE (DECREASE) IN SHARES
OUTSTANDING 897,639 5,070,573 254,381 6,966,686
Ending balance of undistributed
(overdistributed) net investment
income $ 85,188 $ 137,010 $ 18,058 $ 18,058
------------------------------------------------------------------------------------------------------
<CAPTION>
Equity Income Fund Equity Value Fund
----------------------------- -----------------------------
(Unaudited) (Unaudited)
For the For the
Six Months For the Six Months For the
Ended Year Ended Ended Year Ended
June 30, 2000 Dec. 31, 1999 June 30, 2000 Dec. 31, 1999
----------------------------------- -------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
BEGINNING NET ASSETS $127,793,479 $ 86,068,731 $26,567,053 $11,071,528
Operations:
Net investment income (loss) 599,972 1,272,083 112,064 191,302
Net realized gain (loss) on sale
of investments and foreign
currency 3,897,947 1,883,661 (1,164,109) (1,551,864)
Net change in unrealized
appreciation (depreciation) of
investments and translation of
foreign currency (10,523,030) 3,863,205 243,198 569,740
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS (6,025,111) 7,018,949 (808,847) (790,822)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (570,741) (1,284,267) (112,313) (186,534)
Net realized gain on sale of
investments 0 0 0 0
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 6,699,531 38,101,683 9,534,292 19,315,350
Reinvestment of dividends 570,741 1,284,267 112,313 213,190
Cost of shares redeemed (21,090,581) (3,395,884) (5,305,241) (3,055,659)
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM CAPITAL
SHARE TRANSACTIONS (13,820,309) 35,990,066 4,341,364 16,472,881
NET INCREASE (DECREASE) IN NET
ASSETS (20,416,161) 41,724,748 3,420,204 15,495,525
NET ASSETS:
ENDING NET ASSETS $107,377,318 $127,793,479 $29,987,257 $26,567,053
SHARE ISSUED AND REDEEMED:
Shares sold 408,759 2,229,286 1,041,405 2,010,909
Shares issued in reinvestment of
dividends 34,947 75,691 12,127 22,806
Shares redeemed (1,303,739) (205,745) (588,132) (315,799)
NET INCREASE (DECREASE) IN SHARES
OUTSTANDING (860,033) 2,099,232 465,400 1,717,916
Ending balance of undistributed
(overdistributed) net investment
income $ 29,231 $ 0 $ 4,519 $ 4,768
------------------------------------------------------------------------------------------------------
</TABLE>
(1) "Proceeds from shares sold" includes $2,616,673 and "Shares sold" includes
239,403 as a result of the consolidation of the Life & Annuity Trust
Strategic Growth Fund.
The accompanying notes are an integral part of these financial statements.
75
<PAGE> 77
WELL'S FARGO VARIABLE TRUST STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Large Company
Growth Fund Growth Fund
----------------------------- ---------------------------------
(Unaudited) (Unaudited) From
For the For the Sept. 20, 1999
Six Months For the Six Months (commencement
Ended Year Ended Ended of operations) to
June 30, 2000 Dec. 31, 1999 June 30, 2000 Dec. 31, 1999
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
BEGINNING NET ASSETS $128,495,431 $100,926,722 $50,988,017 $ 0
Operations:
Net investment income (loss) 1,712 123,795 (142,145) (55,690)
Net realized gain (loss) on sale
of investments and foreign
currency 2,399,961 10,638,775 (32,264) (83,423)
Net change in unrealized
appreciation (depreciation) of
investments and translation of
foreign currency (2,763,254) 10,407,812 7,261,843 8,206,260
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS (361,581) 21,170,382 7,087,434 8,067,147
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income 0 (143,726) 0 0
Net realized gain on sale of
investments 0 0 0 0
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 3,585,941 13,327,810 36,094,113 44,008,193
Reinvestment of dividends 0 178,395 0 0
Cost of shares redeemed (8,866,539) (6,964,151) (1,872,548) (1,087,323)
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM CAPITAL
SHARE TRANSACTIONS (5,280,598) 6,542,054 34,221,565 42,920,870
NET INCREASE (DECREASE) IN NET
ASSETS (5,642,179) 27,568,710 41,308,999 50,988,017
NET ASSETS:
ENDING NET ASSETS $122,853,252 $128,495,431 $92,297,016 $50,988,017
SHARE ISSUED AND REDEEMED:
Shares sold 150,368 612,846 2,935,817 4,344,118
Shares issued in reinvestment of
dividends 0 8,405 0 0
Shares redeemed (374,678) (325,078) (148,119) (104,555)
NET INCREASE (DECREASE) IN SHARES
OUTSTANDING (224,310) 296,173 2,787,698 4,239,563
Ending balance of undistributed
(overdistributed) net investment
income $ 1,712 $ 0 $ (142,145) $ 0
-----------------------------------------------------------------------------------------------------
<CAPTION>
Money Market Fund Small Cap Growth Fund
----------------------------- --------------------------------
(Unaudited) (Unaudited)
For the For the
Six Months For the Six Months For the
Ended Year Ended Ended Year Ended
June 30, 2000 Dec. 31, 1999 June 30, 2000 Dec. 31, 1999(1)
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
BEGINNING NET ASSETS $ 42,163,569 $ 26,318,825 $ 23,818,991 $13,294,779
Operations:
Net investment income (loss) 1,061,502 1,483,105 (99,320) (49,877)
Net realized gain (loss) on sale
of investments and foreign
currency (391) 11 4,248,235 4,402,871
Net change in unrealized
appreciation (depreciation) of
investments and translation of
foreign currency 0 0 (2,357,393) 5,150,330
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS 1,061,111 1,483,116 1,791,522 9,503,324
DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income (1,061,502) (1,483,116) 0 0
Net realized gain on sale of
investments 0 0 0 0
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 26,633,680 49,943,149 16,061,845 4,726,759
Reinvestment of dividends 1,059,716 1,389,785 0 0
Cost of shares redeemed (28,060,703) (35,488,190) (3,844,848) (3,705,871)
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM CAPITAL
SHARE TRANSACTIONS (367,307) 15,844,744 12,216,997 1,020,888
NET INCREASE (DECREASE) IN NET
ASSETS (367,698) 15,844,744 14,008,519 10,524,212
NET ASSETS:
ENDING NET ASSETS $ 41,795,871 $ 42,163,569 $ 37,827,510 $23,818,991
SHARE ISSUED AND REDEEMED:
Shares sold 26,633,680 49,943,177 818,168 413,588
Shares issued in reinvestment of
dividends 1,059,716 1,389,786 0 0
Shares redeemed (28,060,703) (35,488,190) (201,253) (318,587)
NET INCREASE (DECREASE) IN SHARES
OUTSTANDING (367,307) 15,844,773 616,915 95,001
Ending balance of undistributed
(overdistributed) net investment
income $ 0 $ 0 $ (99,320) $ 0
-----------------------------------------------------------------------------------------------------
</TABLE>
(1) "Proceeds from shares sold" includes $2,616,673 and "Shares sold" includes
239,403 as a result of the consolidation of the Life & Annuity Trust
Strategic Growth Fund.
The accompanying notes are an integral part of these financial statements.
76
<PAGE> 78
WELLS FARGO VARIABLE TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
<CAPTION>
Asset Allocation Fund
-------------------------------------------------------------------
Jan. 1, Jan. 1, Jan. 1, Jan. 1, Jan. 1,
2000 1999 1998 1997 1996
to June 30 to Dec. 31, to Dec. 31, to Dec. 31, to Dec. 31,
2000 1999 1998 1997 1996
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BEGINNING NET ASSET VALUE PER SHARE $ 14.42 $ 13.45 $ 11.99 $ 11.42 $ 11.27
Net investment income (loss) 0.17 0.27 0.34 0.60 0.56
Net realized and unrealized gain (loss) on investments 0.41 0.97 2.60 1.73 0.69
Dividends from net investment income (0.17) (0.26) (0.34) (0.60) (0.56)
Distributions from net realized gains 0.00 (0.01) (1.14) (1.16) (0.54)
Return of capital 0.00 0.00 0.00 0.00 0.00
-------- -------- -------- ------- -------
ENDING NET ASSET VALUE PER SHARE $ 14.83 $ 14.42 $ 13.45 $ 11.99 $ 11.42
======== ======== ======== ======= =======
RATIO TO AVERAGE NET ASSETS (ANNUALIZED):
Net investment income (loss) 2.36% 2.05% 2.62% 5.20% 5.34%
Net expenses 1.00% 0.97% 0.92% 0.80% 0.69%
Gross expenses(1) 1.12% 1.17% 1.11% 0.85% 0.80%
---------------------------------------------------------------------------------------------------------------------------------
Total Return(2) 4.04% 9.33% 25.26% 20.88% 11.46%
Portfolio turnover rate 25% 30% 29% 156% 4%
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD (000'S OMITTED) $260,735 $240,671 $156,241 $86,506 $51,797
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
77
<PAGE> 79
WELLS FARGO VARIABLE TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
<CAPTION>
Corporate
Bond Fund Equity Income Fund
------------------------- -------------------------------------------------------------------
Jan. 1, Sept. 20 Jan. 1, Jan. 1, Jan. 1, Jan. 1, May 6,
2000 1999(3) 2000 1999 1998 1997 1996(3)
to June 30, to Dec. 31, to June 30, to Dec. 31, to Dec. 31, to Dec. 31, to Dec. 31,
2000 1999 2000 1999 1998 1997 1996
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BEGINNING NET ASSET VALUE PER
SHARE $ 9.82 $ 10.00 $ 17.09 $ 16.00 $ 13.68 $ 10.91 $10.00
Net investment income (loss) 0.32 0.16 0.09 0.17 0.18 0.14 0.08
Net realized and unrealized
gain (loss) on investments (0.07) (0.18) (0.86) 1.09 2.34 2.79 0.92
Dividends from net investment
income (0.32) (0.16) (0.09) (0.17) (0.18) (0.14) (0.08)
Distributions from net
realized gains 0.00 0.00 0.00 0.00 (0.02) (0.02) (0.01)
Return of capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- -------- -------- ------- ------- ------
ENDING NET ASSET VALUE PER SHARE $ 9.75 $ 9.82 $ 16.23 $ 17.09 $ 16.00 $ 13.68 $10.91
======= ======= ======== ======== ======= ======= ======
RATIO TO AVERAGE NET ASSETS
(ANNUALIZED):
Net investment income (loss) 6.61% 5.87% 1.09% 1.16% 1.47% 1.85% 2.31%
Net expenses 0.90% 0.90% 1.00% 0.86% 0.80% 0.80% 0.80%
Gross expenses(1) 1.25% 1.25% 1.17% 1.12% 1.10% 1.34% 2.51%
---------------------------------------------------------------------------------------------------------------------------------
Total Return(2) 2.60% (0.16%) (4.53%) 7.90% 18.42% 26.90% 9.95%
Portfolio turnover rate 65% 59% 3% 5% 2% 3% 4%
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD
(000'S OMITTED) $70,402 $68,423 $107,377 $127,793 $86,069 $39,888 $9,415
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
78
<PAGE> 80
WELLS FARGO VARIABLE TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
<CAPTION>
Equity Value Fund Growth Fund
--------------------------------------- ---------------------------------------
Jan. 1, Jan. 1, May 1, Jan. 1, Jan. 1, Jan. 1,
2000 1999 1998(3) 2000 1999 1998
to June 30, to Dec. 31, to Dec. 31, to June 30, to Dec. 31, to Dec. 31,
2000 1999 1998 2000 1999 1998
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BEGINNING NET ASSET VALUE PER SHARE $ 9.23 $ 9.55 $ 10.00 $ 24.10 $ 20.05 $ 16.79
Net investment income (loss) 0.04 0.08 0.07 0.00 0.02 0.09
Net realized and unrealized gain
(loss) on investments (0.26) (0.32) (0.45) (0.04) 4.06 4.65
Dividends from net investment
income (0.04) (0.08) (0.07) 0.00 (0.03) (0.09)
Distributions from net realized
gains 0.00 0.00 0.00 0.00 0.00 (1.39)
Return of capital 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- -------- -------- --------
ENDING NET ASSET VALUE PER SHARE $ 8.97 $ 9.23 $ 9.55 $ 24.06 $ 24.10 $ 20.05
======= ======= ======= ======== ======== ========
RATIO TO AVERAGE NET ASSETS
(ANNUALIZED):
Net investment income (loss) 0.81% 0.96% 1.54% 0.00% 0.11% 0.51%
Net expenses 1.00% 1.06% 1.09% 1.00% 1.07% 1.04%
Gross expenses(1) 1.56% 1.53% 2.52% 1.23% 1.27% 1.18%
----------------------------------------------------------------------------------------------------------------------
Total Return(2) (2.44%) (2.48%) (3.76%) (0.17%) 20.41% 28.81%
Portfolio turnover rate 65% 139% 27% 23% 54% 69%
----------------------------------------------------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD (000'S
OMITTED) $29,987 $26,567 $11,072 $122,853 $128,495 $100,927
----------------------------------------------------------------------------------------------------------------------
<CAPTION>
Growth Fund
-------------------------
Jan. 1, Jan. 1,
1997 1996
to Dec. 31, to Dec. 31,
1997 1996
<S> <C> <C>
BEGINNING NET ASSET VALUE PER SHARE $ 15.34 $ 12.91
Net investment income (loss) 0.19 0.20
Net realized and unrealized gain
(loss) on investments 2.48 2.68
Dividends from net investment
income (0.19) (0.20)
Distributions from net realized
gains (1.03) (0.25)
Return of capital 0.00 0.00
------- -------
ENDING NET ASSET VALUE PER SHARE $ 16.79 $ 15.34
======= =======
RATIO TO AVERAGE NET ASSETS
(ANNUALIZED):
Net investment income (loss) 1.19% 1.53%
Net expenses 0.65% 0.60%
Gross expenses(1) 1.01% 1.12%
--------------------------------------------------------------------------
Total Return(2) 17.33% 22.44%
Portfolio turnover rate 124% 95%
--------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD (000'S
OMITTED) $71,944 $31,381
--------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
79
<PAGE> 81
WELLS FARGO VARIABLE TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
<CAPTION>
Large Company
Growth Fund Money Market Fund
------------------------- -------------------------------------------------------------------
Jan. 1, Sept. 20, Jan. 1, Jan. 1, Jan. 1, Jan. 1, Jan. 1,
2000 1999(3) 2000 1999 1998 1997 1996
to June 30, to Dec. 31, to June 30, to Dec. 31, to Dec. 31, to Dec. 31, to Dec. 31,
2000 1999 2000 1999 1998 1997 1996
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BEGINNING NET ASSET VALUE PER
SHARE $ 12.03 $ 10.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Net investment income (loss) (0.02) (0.01) 0.03 0.04 0.05 0.05 0.05
Net realized and unrealized
gain (loss) on investments 1.12 2.04 0.00 0.00 0.00 0.00 0.00
Dividends from net investment
income 0.00 0.00 (0.03) (0.04) (0.05) (0.05) (0.05)
Distributions from net
realized gains 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Return of capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- ------- ------- ------- -------
ENDING NET ASSET VALUE PER SHARE $ 13.13 $ 12.03 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= ======= =======
RATIO TO AVERAGE NET ASSETS
(ANNUALIZED):
Net investment income (loss) (0.38%) (0.47%) 5.37% 4.45% 4.62% 4.95% 4.64%
Net expenses 1.00% 1.00% 0.85% 0.86% 0.82% 0.53% 0.51%
Gross expenses(1) 1.43% 1.43% 0.90% 1.07% 1.28% 1.07% 1.22%
---------------------------------------------------------------------------------------------------------------------------------
Total Return(2) 9.14% 20.30% 2.69% 4.46% 4.77% 5.04% 4.72%
Portfolio turnover rate 6% 0% N/A N/A N/A N/A N/A
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD
(000'S OMITTED) $92,297 $50,988 $41,796 $42,164 $26,319 $14,788 $12,667
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
80
<PAGE> 82
WELLS FARGO VARIABLE TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
<TABLE>
<CAPTION>
Small Cap Growth Fund
-------------------------------------------------------------------
Jan. 1, Jan. 1, Jan. 1, Jan. 1, Jan. 1,
2000 1999 1998 1997 1996
to June 30, to Dec. 31, to Dec. 31, to Dec. 31, to Dec. 31,
2000 1999 1998 1997 1996
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BEGINNING NET ASSET VALUE PER SHARE $ 18.09 $ 10.88 $ 12.77 $ 13.50 $ 11.21
Net investment income (loss) (0.05) (0.04) 0.03 0.01 0.02
Net realized and unrealized gain (loss) on investments 1.52 7.25 (1.89) 1.24 3.51
Dividends from net investment income 0.00 0.00 (0.03) (0.01) (0.02)
Distributions from net realized gains 0.00 0.00 0.00 (1.59) (1.22)
Return of capital 0.00 0.00 0.00 (0.38) 0.00
------- -------- -------- ------- -------
ENDING NET ASSET VALUE PER SHARE $ 19.56 $ 18.09 $ 10.88 $ 12.77 $ 13.50
======= ======== ======== ======= =======
RATIO TO AVERAGE NET ASSETS (ANNUALIZED):
Net investment income (loss) (0.64%) (0.37%) 0.31% 0.07% 0.16%
Net expenses 1.19% 0.95% 0.80% 0.80% 0.80%
Gross expenses(1) 2.40% 1.94% 1.51% 1.88% 2.82%
---------------------------------------------------------------------------------------------------------------------------------
Total Return(2) 8.13% 66.27% (14.47%) 9.87% 31.47%
Portfolio turnover rate 132% 314% 135% 209% 195%
---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS AT END OF PERIOD (000'S OMITTED) $37,828 $ 23,819 $ 13,295 $11,482 $ 6,091
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
81
<PAGE> 83
WELLS FARGO VARIABLE TRUST
NOTES TO FINANCIAL HIGHLIGHTS (UNAUDITED)
(1) During each period, various fees and expenses were waived and reimbursed.
The ratio of Gross Expenses to Average Net Assets reflects the expense ratio
in the absence of any waivers and reimbursements (Note 9).
(2) Total return calculations do not include any sales charges, and would have
been lower had certain expenses not been waived or reimbursed during the
period shown. Total return figures do not reflect charges pursuant to the
terms of the variable life insurance policies and variable annuity contracts
funded by separate accounts that invest in the Fund's shares. Total returns
for periods less than one year are not annualized.
(3) Commencement of operations.
The accompanying notes are an integral part of these financial statements.
82
<PAGE> 84
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION
Wells Fargo Variable Trust (the "Trust") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end series
management investment company. The Trust consists of eight separate diversified
funds (each, a "Fund", collectively, the "Funds") as of the end of the reporting
period: the Asset Allocation, Corporate Bond, Equity Income, Equity Value,
Growth, Large Company Growth, Money Market, and Small Cap Growth Funds. The
Funds are available exclusively as pooled funding vehicles for certain
participating life insurance companies offering variable annuity contracts and
variable life insurance policies.
2. SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies which are consistently followed by
the Trust in the preparation of its financial statements are in conformity with
generally accepted accounting principles ("GAAP") for investment companies.
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
SECURITY VALUATION
Investments in securities for all Funds, except the Money Market Fund, are
valued each business day as of the close of regular trading on the New York
Stock Exchange which is usually 1:00 p.m. (Pacific Time) 3:00 p.m. (Central
Time). Securities which are traded on a national or foreign securities exchange
or the National Association of Securities Dealers Automated Quotation ("NASDAQ")
National Market are valued at the last reported sales price. In the absence of
any sale of such securities, and in the case of other securities, including U.S.
Government obligations, but excluding debt securities maturing in 60 days or
less, the valuations are based on the latest quoted bid prices. Securities
denominated in foreign currencies are translated into U.S. dollars using the
closing rates of exchange in effect on the day of valuation. Securities for
which quotations are not readily available are valued at fair value as
determined by policies set by the Trust's Board of Trustees.
The Money Market Fund values its shares at 9:00 a.m. (Pacific Time) each
business day. The Money Market Fund invests only in securities with remaining
maturities not exceeding 397 days (13 months). Securities held in the Money
Market Fund and debt securities maturing in 60 days or less are valued using the
amortized cost method which involves valuing a security at its cost, plus
accretion of discount or minus amortization of premium over the period until
maturity, which approximates market value. The Money Market Fund seeks to
maintain a constant net asset value of $1.00 per share, although there is no
assurance that it will be able to do so.
SECURITY TRANSACTIONS AND INCOME RECOGNITION
Securities transactions are recorded on a trade date basis. Realized gains or
losses are reported on the basis of identified cost of securities delivered.
Interest income is accrued daily and bond discounts are accreted and premiums
are amortized under provisions of the Internal Revenue Code of 1986, as amended
(the "Code").
Dividend income is recognized on the ex-dividend date, except for certain
dividends from foreign securities, which are recorded as soon as the Fund is
informed of the ex-dividend date. Dividend income from foreign securities is
recorded net of foreign taxes withheld where recovery of such taxes is not
assured.
Foreign currency amounts are translated into U.S. dollars at the mean of the bid
and ask price of such currencies against U.S. dollars as follows: (i) assets and
liabilities at the rate of exchange at the end of the respective period; and
(ii) purchases and sales of securities and income and expenses at the rate of
exchange prevailing on the dates of such transactions. The portion of the
results of operations arising from changes in the exchange rates and the portion
due to fluctuations arising
83
<PAGE> 85
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
from changes in the market prices of securities are not isolated. Such
fluctuations are included with the net realized and unrealized gain or loss on
investments.
REPURCHASE AGREEMENTS
Each Fund may invest in repurchase agreements and may participate in pooled
repurchase agreement transactions with other funds advised by Wells Fargo Bank,
N.A. ("WFB"). The repurchase agreements must be fully collateralized based on
values that are marked to market daily. The collateral may be held by an agent
bank under a tri-party agreement. It is the Funds' custodians' responsibility to
value collateral daily and to take action to obtain additional collateral as
necessary to maintain market value equal to or greater than the resale price.
The repurchase agreements held by the Funds are collateralized by instruments
such as U.S. Treasury or federal agency obligations.
FUTURES CONTRACTS
The Asset Allocation and Equity Value Funds may purchase futures contracts to
gain exposure to market changes, which may be more efficient or cost effective
than actually buying the securities. A futures contract is an agreement between
parties to buy or sell a security at a set price on a future date. Upon entering
into such a contract, a Fund is required to pledge to the broker an amount of
cash, U.S. Government obligations or other high-quality debt securities equal to
the minimum "initial margin" requirements of the exchange on which the futures
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in the value
of the contract. Such receipts or payments are known as "variation margin" and
are recorded by the Fund as unrealized gains or losses. When the contract is
closed, the Fund records a realized gain or loss equal to the difference between
the value of the contract at the time it was opened and the value at the time it
was closed. Pursuant to regulations and/or published positions of the Securities
and Exchange Commission (the "SEC") for long futures positions, the Fund is
required to segregate highly liquid securities as permitted by the SEC in
connection with futures transactions in an amount generally equal to the entire
value of the underlying contracts. Risks of entering into futures contracts
include the possibility that there may be an illiquid market and that a change
in the value of the contract may not correlate with changes in the value of the
underlying securities. On June 30, 2000, the Asset Allocation Fund held the
following long futures contracts:
<TABLE>
<CAPTION>
Notional Net Unrealized
CONTRACTS Type Expiration Date Contract Value Depreciation
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
17 S&P 500 Index September 2000 $6,239,425 $(127,075)
</TABLE>
The Asset Allocation Fund has pledged to brokers U.S. Treasury bills for initial
margin requirements with a par value of $375,000.
FORWARD FOREIGN CURRENCY CONTRACTS
The Funds may enter into forward currency exchange contracts to protect against
a possible loss resulting from an adverse change in the relationship between
foreign currencies and the U.S. dollar, or between foreign currencies. Risks
arise from the possible inability of counterparties to meet the terms of their
contracts and from movements in currency values. At June 30, 2000, the Corporate
Bond Fund had entered into a forward foreign currency contract under which it is
obligated to exchange currencies at a specified future date. The Fund had an
outstanding contract to sell 743,000 EURO and receive $670,669 on August 14,
2000. Net unrealized depreciation of $(43,302) on this contract is included in
the accompanying financial statements.
DISTRIBUTIONS TO SHAREHOLDERS
Dividends to shareholders from net investment income, if any, for the Growth,
Large Company Growth, and Small Cap Growth Funds are declared and distributed
annually. Dividends to shareholders from net investment income, if any, for the
Asset Allocation, Equity Income, and Equity Value Funds are declared and
distributed quarterly. Dividends to shareholders
84
<PAGE> 86
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
from net investment income, if any, for the Corporate Bond and Money Market
Funds are declared daily and distributed monthly. Distributions to shareholders
from net realized capital gains, if any, are declared and distributed at least
annually.
Distributions are based on amounts calculated in accordance with the applicable
federal income tax regulations, which may differ from generally accepted
accounting principles. The timing and character of distributions made during the
period from net investment income or net realized gains may also differ from
their ultimate characterization for federal income tax purposes. The differences
between the income or gains distributed on a book versus tax basis are shown as
excess distributions of net investment income and net realized gain on sales of
investments in the accompanying Statements of Changes in Net Assets. To the
extent that these differences are permanent in nature, such amounts are
reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassifications.
FEDERAL INCOME TAXES
Each Fund of the Trust is treated as a separate entity for federal income tax
purposes. It is the policy of each Fund to continue to qualify as a regulated
investment company by complying with the provisions applicable to regulated
investment companies, as defined in the Code, and to make distributions of
substantially all of its investment company taxable income and any net realized
capital gains (after reduction for capital loss carryforwards) sufficient to
relieve it from all, or substantially all, federal income taxes. Accordingly, no
provision for federal income taxes was required at June 30, 2000.
The following Funds had estimated net capital loss carryforwards at June 30,
2000, which are available to offset future net realized capital gains:
<TABLE>
<CAPTION>
Capital Loss
FUND Year Expires Carryforwards
-------------------------------------------------------------------------------------------------
<S> <C> <C>
Corporate Bond Fund 2007 $ 34,524
Equity Value Fund 2006 79,556
2007 1,202,701
</TABLE>
3. ADVISORY FEES
The Trust has entered into separate advisory contracts on behalf of the Funds
with WFB. Pursuant to the contracts, WFB has agreed to provide the following
Funds with daily portfolio management, for which, WFB is entitled to be paid a
monthly advisory fee at the following annual rates:
<TABLE>
<CAPTION>
% of Average
FUND Daily Net Assets
-------------------------------------------------------------------------------------------
<S> <C>
Asset Allocation Fund 0.55
Corporate Bond Fund 0.45
Equity Income Fund 0.55
Equity Value Fund 0.55
Growth Fund 0.55
Large Company Growth Fund 0.55
Money Market Fund 0.40
Small Cap Growth Fund 0.75
</TABLE>
Prior to September 20, 1999, the predecessor funds for the Asset Allocation,
Equity Value, Growth and Money Market Funds had also retained WFB as investment
advisor. WFB was entitled to a fee from the Money Market Fund at the annual rate
of 0.45% of the Fund's average daily net assets. WFB was entitled to a fee at
the annual rate of 0.60% of the average daily net assets of the other Funds. The
predecessor funds for the Equity Income and Small Cap Growth Funds had retained
Norwest
85
<PAGE> 87
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Investment Management, Inc. ("NIM"), then a wholly-owned subsidiary of Norwest
Bank Minnesota, N.A. (now known as Wells Fargo Bank Minnesota, N.A. and a
wholly-owned subsidiary of Wells Fargo & Co.) as their investment advisor. NIM
was entitled to a fee at the annual rate of 0.80% of the average daily net
assets of each of these respective Funds. The Corporate Bond and Large Company
Growth Funds are new series of the Trust and did not have predecessor
portfolios.
Wells Capital Management Incorporated ("WCM"), a wholly-owned subsidiary of WFB,
acts as investment sub-advisor to the Corporate Bond, Equity Income, Equity
Value, Growth, Money Market, and Small Cap Growth Funds. WCM is entitled to
receive from WFB, as compensation for its sub-advisory services to the Equity
Income, Equity Value, Growth, and Small Cap Growth Funds, a monthly fee at the
annual rate of 0.25% of each Fund's average daily net assets up to $200 million,
0.20% for the next $200 million and 0.15% of the Fund's average daily net assets
in excess of $400 million. WCM is entitled to receive from WFB, as compensation
for its sub-advisory services to the Corporate Bond Fund, a monthly fee at the
annual rate of 0.15% of the Fund's average daily net assets up to $400 million,
0.125% for the next $400 million and 0.10% of the Fund's average daily net
assets in excess of $800 million. WCM is entitled to receive from WFB, as
compensation for its sub-advisory services to the Money Market Fund, a monthly
fee at the annual rate of 0.05% of the Fund's average daily net assets up to $1
billion and 0.04% of the Fund's average daily net assets in excess of $1
billion. Prior to September 20, 1999, the Equity Value, Growth, and Money Market
Funds were charged at the same annual rates.
Barclays Global Fund Advisors ("BGFA"), a wholly-owned subsidiary of Barclays
Global Investors, N.A. ("BGI") and indirect subsidiary of Barclays Bank PLC,
acts as sub-advisor to the Asset Allocation Fund. BGFA is entitled to receive
from WFB, as compensation for its sub-advisory services, a monthly fee at the
annual rate of 0.15% of the Fund's average daily net assets.
Peregrine Capital Management Incorporated ("Peregrine") acts as sub-advisor to
the Large Company Growth Fund. Peregrine is entitled to receive from WFB, as
compensation for its sub-advisory services, a monthly fee at the annual rate of
0.75% of the Fund's average daily net assets up to $25 million, 0.60% of the
Fund's average daily net assets for the next $25 million, 0.50% of the Fund's
average daily net assets for the next $225 million, and 0.30% of the Fund's
average daily net assets in excess of $275 million.
4. DISTRIBUTION FEES
The Trust has adopted a Distribution Plan ("Plan") for the Funds pursuant to
Rule 12b-1 under the 1940 Act. Distribution fees are charged and paid to
Stephens Inc. ("Stephens") at a rate of 0.25% of the average daily net assets of
each Fund. The distribution fees paid on behalf of the Funds for the period
ended June 30, 2000 are disclosed on the Statement of Operations.
5. ADMINISTRATION FEES
The Trust has entered into an administration agreement on behalf of the Funds
with WFB whereby WFB is entitled to receive monthly fees at the annual rate of
0.15% of each Fund's average daily net assets. Prior to September 20, 1999, the
predecessor Life & Annuity Trust had also retained WFB to provide administration
services to the Asset Allocation, Equity Value, Growth and Money Market Funds at
the rate and under substantially the same terms provided by the current
agreement.
Prior to September 20, 1999, the predecessor Norwest Select Trust had entered
into an administration agreement with Forum Administrative Services, LLC
("FAdS") on behalf of the Equity Income and Small Cap Growth Funds. The Funds
were charged monthly fees at the annual rate of 0.05% of each Fund's average
daily net assets.
6. TRANSFER AGENT FEES
The Trust has entered into a transfer agency agreement on behalf of the Funds
with Boston Financial Data Services ("BFDS"). WFB has been engaged by BFDS to
provide sub-transfer agency services for the Funds.
86
<PAGE> 88
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Prior to September 20, 1999, Norwest provided transfer agency, custody, and
shareholder services for the Equity Income and Small Cap Growth Funds at an
annual rate of 0.08% of the average daily net assets of each Fund. Prior to
September 20, 1999, BFDS provided transfer agency services at the same rates
pursuant to a substantially similar agreement, and prior to July 17, 1999, WFB
provided transfer agency services for the Asset Allocation, Equity Value, and
Growth Funds. WFB was entitled to a fee at an annual rate of 0.14% of the
average daily net assets of each Fund, and for the Money Market Fund, at an
annual rate of 0.10% of the average daily net assets of the Fund.
7. SHAREHOLDER SERVICING FEES
Prior to September 20, 1999, the Asset Allocation, Equity Value, Growth, and
Money Market Funds were charged 0.25% of each Fund's average daily net assets
for shareholder services.
8. OTHER FEES AND TRANSACTIONS WITH AFFILIATES
Forum Accounting Services, LLC ("Forum") provides portfolio accounting services
to the Funds. For these services, Forum is entitled to receive a fixed monthly
per fund fee, a basis point fee of 0.0025% of the average daily net assets of
each Fund, and will be reimbursed for all out-of-pocket expenses reasonably
incurred in providing these services. Prior to September 20, 1999, the
predecessor Life & Annuity Trust entered into contracts on behalf of the Asset
Allocation, Equity Value, Growth, and Money Market Funds with WFB, whereby WFB
was responsible for providing portfolio accounting services for the Funds.
Pursuant to the contract, WFB was entitled to a monthly base fee from each Fund
of $2,000 plus an annual fee of 0.07% of the first $50 million of each Fund's
average daily net assets, 0.045% of the next $50 million, and 0.02% of each
Fund's average daily net assets in excess of $100 million. For the Equity Income
and Small Cap Growth Funds, portfolio accounting services were provided by
Forum.
The Trust has entered into contracts on behalf of each Fund (other than the
Asset Allocation Fund, for which BGI serves as custodian) with Wells Fargo Bank
Minnesota, N.A. ("WFB MN"), an affiliated party, whereby WFB MN is responsible
for providing custody services for the Funds. Pursuant to the contract, WFB MN
is entitled to certain transaction charges plus a monthly fee for custody
services at the annual rate of 0.02% of the average daily net assets of each
Fund. Prior to September 20, 1999, the Equity Value, Growth, and Money Market
Funds had the above services performed by WFB for a fee at an annual rate of
0.0167% of the average daily net assets of each Fund. The Equity Income and
Small Cap Growth Funds also had WFB MN serve as the custodian. For its custody
services, in addition to shareholder servicing and transfer agent services, WFB
MN was entitled to receive a fee at an annual rate of 0.08% of the average daily
net assets of each Fund.
BGI, a wholly-owned subsidiary of Barclays Global Investors Inc., acts as
custodian to the Asset Allocation Fund. BGI is not entitled to receive
compensation for its custodial services to the Fund so long as BGFA is entitled
to receive compensation for providing investment sub-advisory services to the
Fund. Prior to September 20, 1999, this same arrangement was in place.
Certain officers of the Trust were also officers of Stephens for a portion of
the period. As of June 30, 2000, Stephens owned 4,220 shares of the Asset
Allocation Fund, 3,579 shares of the Corporate Bond Fund, 10,209 shares of the
Equity Value Fund, 3,120 shares of the Growth Fund, 33,500 shares of the Money
Market Fund, and 16,148 shares of the Small Cap Growth Fund.
9. WAIVED FEES AND REIMBURSED EXPENSES
All amounts shown as waived fees or reimbursed expenses on the Statement of
Operations, for the six months ended June 30, 2000, were waived by WFB or
reimbursed by Stephens.
87
<PAGE> 89
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
<TABLE>
<CAPTION>
Expenses Reimbursed Fees Waived
FUND by Stephens by WFB Total Fees Waived
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Asset Allocation Fund $0 $156,226 $156,226
Corporate Bond Fund 0 123,107 123,107
Equity Income Fund 0 95,772 95,772
Equity Value Fund 0 78,047 78,047
Growth Fund 0 141,228 141,228
Large Company Growth Fund 0 160,901 160,901
Money Market Fund 0 9,461 9,461
Small Cap Growth Fund 31,676 156,880 188,556
</TABLE>
10. INVESTMENT PORTFOLIO TRANSACTIONS
Purchases and sales of investments, exclusive of short-term securities
(securities with maturities of one year or less at purchase date), for each Fund
for the six months ended June 30, 2000, were as follows:
AGGREGATE PURCHASES AND SALES
<TABLE>
<CAPTION>
Purchases at
FUND Cost Sales Proceeds
-----------------------------------------------------------------------------------------------------
<S> <C> <C>
Asset Allocation Fund $74,372,446 $61,652,509
Corporate Bond Fund 47,855,722 44,702,549
Equity Income Fund 3,711,924 14,565,139
Equity Value Fund 21,304,759 17,527,734
Growth Fund 28,214,775 30,858,930
Large Company Growth Fund 38,992,949 4,550,307
Small Cap Growth Fund 48,837,164 38,112,535
</TABLE>
The Money Market Fund, not reflected in this schedule, trades exclusively in
short-term securities.
11. REORGANIZATION
Concurrent with the establishment of the Trust, the Board of Trustees of the
Life & Annuity Trust ("LAT") and the Board of Trustees of the Norwest Select
Funds ("Select") approved a consolidation agreement providing for the
acquisition of the assets and the assumption of liabilities of certain LAT and
Norwest Select Funds into the Wells Fargo Variable Trust Funds.
88
<PAGE> 90
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Effective at the close of business September 17, 1999, the LAT and/or Select
Funds were consolidated into the respective Wells Fargo Variable Trust Funds
through an exchange of shares as follows:
<TABLE>
<CAPTION>
LIFE & ANNUITY TRUST FUND NORWEST SELECT FUND WELLS FARGO VARIABLE TRUST FUND
------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Asset Allocation Fund* Asset Allocation Fund
U.S. Government Allocation Fund Income Fund Corporate Bond Fund**
Income Equity Fund* Equity Income Fund
Equity Value Fund* Equity Value Fund
Growth Fund* Growth Fund
ValuGrowth Stock Fund Large Company Growth Fund**
Money Market Fund* Money Market Fund
Strategic Growth Fund Small Company Stock Fund* Small Cap Growth Fund
</TABLE>
---------------
* Accounting survivor
** New fund (no accounting survivor)
In the consolidation, the Wells Fargo Variable Trust Small Cap Growth Fund
acquired all of the net assets of the LAT Strategic Growth Fund and Norwest
Select Small Company Stock Fund. The LAT Strategic Growth Fund exchanged its
173,629 shares (valued at $2,616,673) for 239,403 shares of the Wells Fargo
Variable Trust Small Cap Growth Fund. The net assets of the LAT Strategic Growth
Fund included unrealized appreciation of $270,587.
The Wells Fargo Variable Trust Corporate Bond and Large Company Growth Funds did
receive assets from LAT and Select Trust Funds, but have different investment
objectives and other operating differences, and therefore they do not have an
accounting survivor and commenced operations on September 20, 1999 for financial
reporting purposes.
89
<PAGE> 91
LIST OF ABBREVIATIONS
The following is a list of common abbreviations for terms and entities
which may have appeared in this report.
<TABLE>
<S> <C> <C>
ABAG -- Association of Bay Area Governments
ADR -- American Depository Receipts
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
ARM -- Adjustable Rate Mortgages
BART -- Bay Area Rapid Transit
CDA -- Community Development Authority
CDSC -- Contingent Deferred Sales Charge
CGIC -- Capital Guaranty Insurance Company
CGY -- Capital Guaranty Corporation
CMT -- Constant Maturity Treasury
COFI -- Cost of Funds Index
CONNIE LEE -- Connie Lee Insurance Company
COP -- Certificate of Participation
CP -- Commercial Paper
CTF -- Common Trust Fund
DW&P -- Department of Water & Power
DWR -- Department of Water Resources
EDFA -- Education Finance Authority
FGIC -- Financial Guaranty Insurance Corporation
FHA -- Federal Housing Authority
FHLB -- Federal Home Loan Bank
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
FRN -- Floating Rate Notes
FSA -- Financial Security Assurance, Inc.
GNMA -- Government National Mortgage Association
GO -- General Obligation
HFA -- Housing Finance Authority
HFFA -- Health Facilities Financing Authority
IDA -- Industrial Development Authority
LIBOR -- London Interbank Offered Rate
LLC -- Limited Liability Corporation
LOC -- Letter of Credit
LP -- Limited Partnership
MBIA -- Municipal Bond Insurance Association
MFHR -- Multi-Family Housing Revenue
MUD -- Municipal Utility District
MTN -- Medium Term Note
PCFA -- Pollution Control Finance Authority
PCR -- Pollution Control Revenue
PFA -- Public Finance Authority
PLC -- Private Placement
PSFG -- Public School Fund Guaranty
RAW -- Revenue Anticipation Warrants
RDA -- Redevelopment Authority
RDFA -- Redevelopment Finance Authority
R&D -- Research & Development
SFMR -- Single Family Mortgage Revenue
TBA -- To Be Announced
TRAN -- Tax Revenue Anticipation Notes
USD -- Unified School District
V/R -- Variable Rate
WEBS -- World Equity Benchmark Shares
</TABLE>
90
<PAGE> 92
American Skandia Life
Assurance Company
Tower One Corporate Drive
Shelton, CT 06484
__________________
PRSRT
STANDARD
U.S. POSTAGE
PAID
B.F.C.
Mailed from
Zip Code 07102
__________________
This report and the financial statements contained herein are submitted for the
general information of the contract holders of the Stagecoach Variable Annuity,
Stagecoach Variable Annuity Plus, Stagecoach Extra Credit Variable Annuity, and
the Stagecoach Variable Annuity Flex. If this report is used for promotional
purposes, distribution of the report must be accompanied or proceeded by a
current prospectus. For a prospectus containing more complete information,
including charges and expenses, call 1-800-680-8920. Read the prospectus
carefully before you invest.
Printed on Recycled Paper (c) 2000 American Skandia SAR 014 (8/00)
