MUTUAL OF AMERICA
SEPARATE ACCOUNT NO. 3
SEMI-ANNUAL REPORT
JUNE 30, 2000
This report is not to be construed as an offering for sale of any
Variable Product. No offering is made except in conjunction with a prospectus
which must precede or accompany this report.
<PAGE>
MUTUAL OF AMERICA
Separate Account No. 3
Semi-Annual Report
June 30, 2000
Dear Policyowner:
We are pleased to send you the 2000 Semi-Annual Report of Mutual of
America's Separate Account No. 3. This Account, which commenced operations April
3, 2000, is an investment vehicle for owners of our Variable Universal Life
policies. Separate Account No. 3 consists of seventeen distinct funds. Each
invests in shares of one of nine funds of Mutual of America Investment
Corporation ("Investment Company"): the Money Market, All America, Equity Index,
Mid-Cap Equity Index, Bond, Short-Term Bond, Mid-Term Bond, Composite and
Aggressive Equity Funds; three portfolios of Scudder Variable Life Investment
Fund ("Scudder"): The Bond, Capital Growth and International Portfolios; the VP
Capital Appreciation Fund of American Century Variable Portfolios, Inc.
("American Century"); the Calvert Social Balanced Portfolio of Calvert Variable
Series, Inc. ("Calvert"); the Equity-Income Portfolio of Fidelity Investments
Variable Insurance Products Fund ("Fidelity VIP"); and the Contrafund and Asset
Manager Portfolios of Fidelity Investments Variable Insurance Products Fund II
("Fidelity VIP II").
Each of the Funds of Separate Account No. 3 owns shares in a similarly
named fund of the Investment Company, portfolio of Scudder, fund of American
Century, portfolio of Calvert, portfolio of Fidelity VIP and portfolio of
Fidelity VIP II. The investment results of each of the Funds of Separate Account
No. 3 are based on the performance of the corresponding funds or portfolios of
the Investment Company, Scudder, American Century, Calvert, Fidelity VIP and
Fidelity VIP II.
The investment objectives and primary investments of the funds and
portfolios in which the Separate Account Funds invested in 2000 are summarized
as follows:
Investment Company Money Market Fund: This Fund seeks to realize high
current income to the extent consistent with the maintenance of liquidity,
investment quality and stability of capital through investments in money market
instruments and other short-term debt securities.
Investment Company All America Fund: This Fund seeks to outperform the
Standard & Poor's Composite Index of 500 Stocks (the "S&P 500 Index") by
investing in a diversified portfolio of primarily common stocks. The Fund
invests approximately 60% of its assets (the "Indexed Assets") to provide
investment results that correspond to the performance of the S&P 500 Index. The
remaining approximately 40% of its assets (the "Active Assets") seek to achieve
a high level of total return, through both appreciation of capital and, to a
lesser extent, current income, by means of a diversified portfolio of primarily
common stocks with a broad exposure to the market. ("Standard & Poor's",
"S&P" and "S&P 500" are trademarks of The McGraw-Hill Companies, Inc.)
Investment Company Equity Index Fund: This Fund seeks to provide
investment results that correspond to the performance of the S&P 500 Index by
investing primarily in the common stocks that comprise the S&P 500 Index.
Investment Company Mid-Cap Equity Index Fund: This Fund seeks to provide
investment results that correspond to the performance of the S&P MidCap 400
Index by investing primarily in the common stocks that comprise the S&P MidCap
400 Index. ("S&P MidCap 400" is a trademark of The McGraw-Hill Companies, Inc.)
Investment Company Bond Fund: This Fund seeks to provide as high a level
of current income over time as is believed consistent with prudent investment
risk, with preservation of capital a secondary objective, by investing primarily
in publicly-traded, investment grade debt securities.
Investment Company Short-Term Bond Fund: This Fund seeks to provide as
high a level of current income over time as is believed consistent with prudent
investment risk, with preservation of capital a secondary objective, by
investing primarily in publicly-traded, investment grade debt securities and
money market instruments. The average maturity of the Fund is between one and
three years.
1
<PAGE>
Investment Company Mid-Term Bond Fund: This Fund seeks to provide as high
a level of current income over time as is believed consistent with prudent
investment risk, with preservation of capital a secondary objective, by
investing primarily in publicly-traded, investment grade debt securities. The
average maturity of the Fund is between three and seven years.
Investment Company Composite Fund: This Fund seeks to achieve as high a
total rate of return, through both appreciation of capital and current income,
as is consistent with prudent investment risk, by investing in a diversified
portfolio of publicly-traded common stocks, bonds and money market instruments.
Investment Company Aggressive Equity Fund: This Fund's investment
objective is capital appreciation, by investing in companies believed to possess
above-average growth potential and in companies believed to possess valuable
assets or whose securities are believed to be undervalued in the marketplace.
Scudder Bond Portfolio: This Portfolio seeks a high level of income
consistent with a high quality portfolio of primarily investment grade debt
securities.
Scudder Capital Growth Portfolio: This Portfolio seeks to maximize
long-term capital growth through a broad and flexible investment program, by
investing in marketable securities, principally common stocks and, consistent
with its objective of long-term capital growth, preferred stocks. The Portfolio
may invest up to 20% of its assets in intermediate to longer-term debt
instruments depending on market and economic conditions.
Scudder International Portfolio: This Portfolio seeks long-term growth of
capital primarily through a diversified portfolio of foreign equity securities,
by investing primarily in established companies that do business principally
outside of the United States and that are listed on foreign exchanges.
American Century VP Capital Appreciation Fund: This Fund seeks capital
growth by investing primarily in common stocks that meet certain fundamental and
technical standards and are considered by the Fund's management to have
better-than-average prospects for appreciation.
Calvert Social Balanced Portfolio: This Portfolio seeks a competitive
total return through an actively managed, non-diversified portfolio of stocks,
bonds and money market instruments that offer income and growth opportunity and
satisfy the Portfolio's investment and social concern criteria established for
the Portfolio.
Fidelity VIP Equity-Income Portfolio: This Portfolio seeks reasonable
income by investing primarily in income-producing equity securities, while
considering the potential for capital appreciation, and it also seeks to achieve
a yield that exceeds the composite yield on the securities comprising the S&P
500 Index.
Fidelity VIP II Contrafund Portfolio: This Portfolio seeks capital
appreciation over the long term by investing in securities of companies whose
value, the Portfolio's adviser believes, is not fully recognized by the public.
These securities may be issued by domestic or foreign companies and many may not
be well known. The Portfolio normally invests primarily in common stocks.
Fidelity VIP II Asset Manager Portfolio: This Portfolio seeks high total
return with reduced risk over the long term by allocating its assets among
domestic and foreign stocks, bonds and short-term/money market instruments, with
an expected "neutral mix" over the long term of 10% in short-term/money market
instruments, 40% in bonds and 50% in stocks.
2
<PAGE>
For the six months ended June 30, 2000, the following total returns were
experienced in these seventeen Separate Account Funds:
Investment Company Money Market Fund(1) ...................... + 1.9%
Investment Company All America Fund .......................... + 3.9%
Investment Company Equity Index Fund ......................... - 1.5%
Investment Company Mid-Cap Equity Index Fund ................. + 7.0%
Investment Company Bond Fund ................................. + 2.5%
Investment Company Short-Term Bond Fund ...................... + 2.2%
Investment Company Mid-Term Bond Fund ........................ + 0.6%
Investment Company Composite Fund ............................ - 0.9%
Investment Company Aggressive Equity Fund .................... + 2.7%
Scudder Bond Fund ............................................ + 2.2%
Scudder Capital Growth Fund .................................. + 2.3%
Scudder International Fund ................................... -11.9%
American Century VP Capital Appreciation Fund ................ +16.4%
Calvert Social Balanced Fund ................................. + 1.6%
Fidelity VIP Equity-Income Fund .............................. - 3.7%
Fidelity VIP II Contrafund ................................... - 2.3%
Fidelity VIP II Asset Manager Fund ........................... - 1.7%
----------
(1) The seven-day net annualized effective yield as of 8/15/00 was 4.7% and is
not necessarily indicative of future actual yields.
Total return is equal to the changes in the value of a unit of
participation in a Fund from the beginning to the end of the specified period.
It reflects investment income earned and reinvested plus the changes in the
market value (whether realized or unrealized) of the securities in the
respective fund or portfolio of the Investment Company, Scudder, American
Century, Calvert or Fidelity during the indicated period. Results are net of all
charges, including a monthly service charge (assessed against an average account
balance for all policyowners) based upon a hypothetical $1,000 invested at the
beginning of the period. These returns are not guaranteed and are not
necessarily indicative of the future investment performance of the particular
fund. Withdrawals and contributions made within a period would experience
different rates of return based on the respective unit values on the dates of
such transactions.
This report includes financial statements for each Fund of Separate
Account No. 3. Accompanying this report are the financial statements for each
similarly named fund of the Investment Company, portfolios of Scudder, fund of
American Century, portfolio of Calvert and portfolios of Fidelity VIP and
Fidelity VIP II.
Total Return Separate Account Performance Notes for extended time periods
and other services are available by calling 1-800-468-3785.
I hope you will find this report helpful and informative.
Sincerely,
/s/ Manfred Altstadt
----------------------------------------
Manfred Altstadt
Senior Executive Vice President
and Chief Financial Officer,
Mutual of America Life Insurance Company
3
<PAGE>
CONTENTS
Page
----
Semi-Annual Report of Mutual of America Separate Account No. 3 .......... 1
Statement of Assets and Liabilities .................................. 5
Statement of Operations .............................................. 7
Statements of Changes in Net Assets .................................. 9
Notes to Financial Statements ........................................ 12
4
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Investment Company
----------- -------------- ------------ -------------- --------
Money All Equity Mid-Cap
Market America Index Equity Index Bond
Fund Fund Fund Fund Fund
----------- -------------- ------------ -------------- --------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments in Mutual of America Investment Corporation
at market value
(Cost:
Money Market Fund -- $12,119
All America Fund -- $1,141,427
Equity Index Fund -- $538,556
Mid-Cap Equity Index Fund -- $1,204
Bond Fund -- $113,303)
(Notes 1 and 2) ...................................... $12,266 $1,096,292 $524,725 $ 1,169 $113,357
Due From (To) General Account ........................... 4,611 118,358 121,104 205,455 (86,475)
------- ---------- -------- -------- --------
NET ASSETS .............................................. $16,877 $1,214,650 $645,829 $206,624 $ 26,882
======= ========== ======== ======== ========
UNIT VALUE AT JUNE 30, 2000 (Note 5) .................... $ 2.16 $ 10.50 $ 3.38 $ 1.19 $ 3.17
======= ========== ======== ======== ========
NUMBER OF UNITS OUTSTANDING AT
JUNE 30, 2000 (Note 5) ............................... 7,819 115,721 191,122 173,492 8,490
======= ========== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Investment Company
----------------------------------------------------
Aggressive-
Short-Term Mid-Term Composite Equity
Bond Fund Bond Fund Fund Fund
---------- ---------- -------- ----------
<S> <C> <C> <C> <C>
ASSETS:
Investments in Mutual of America Investment Corporation
at market value
(Cost:
Short-Term Bond Fund -- $7,791
Mid-Term Bond Fund -- $9,215
Composite Fund -- $834,151
Aggressive Equity Fund -- $581,763
(Notes 1 and 2) ................................................ $ 7,826 $ 9,229 $ 818,075 $555,842
Due From (To) General Account ..................................... (4,233) (5,119) (617,595) (79,019)
------- ------- --------- --------
NET ASSETS ........................................................ $ 3,593 $ 4,110 $ 200,480 $476,823
======= ======= ========= ========
UNIT VALUE AT JUNE 30, 2000 (Note 5) .............................. $ 1.32 $ 1.34 $ 5.58 $ 2.94
======= ======= ========= ========
NUMBER OF UNITS OUTSTANDING AT
JUNE 30, 2000 (Note 5) ......................................... 2,731 3,070 35,900 161,971
======= ======= ========= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
American
Scudder Century
---------------------------------------------- ------------
Capital VP Capital
Bond Growth International Appreciation
Fund Fund Fund Fund
---------------------------------------------- ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in Scudder Portfolios and American Century VP
Capital Appreciation Fund at market value
(Cost:
Scudder Bond Fund -- $3,650
Scudder Capital Growth Fund -- $923,064
Scudder International Fund -- $242,046
American Century VP capital
Appreciation Fund -- $133,402)
(Notes 1 and 2) ..................................... $3,678 $ 944,601 $238,900 $138,685
Due From (To) General Account .......................... 3,388 70,252 11,265 19,833
------ ---------- -------- --------
NET ASSETS: ............................................ $7,066 $1,014,853 $250,165 $158,518
====== ========== ======== ========
UNIT VALUE AT JUNE 30, 2000 (NOTE 5) ................... $13.07 $ 49.52 $ 22.89 $ 20.33
====== ========== ======== ========
NUMBER OF UNITS OUTSTANDING AT
JUNE 30, 2000 (Note 5) .............................. 541 20,493 10,930 7,798
====== ========== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Calvert Fidelity
-------- -----------------------------------------
Social VIP VIP II VIP II
Balanced Equity-Income Contra Asset Manager
Fund Fund Fund Fund
-------- ------------- -------- -------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in Calvert Social Balance Portfolio
and Fidelity Portfolios at market value
(Cost:
Calvert Social Balanced Fund -- $36,006
VIP Equity-Income -- $127,525
VIP II Contra Fund -- $460,440
VIP II Asset Manager -- $42,412)
(Notes 1 and 2) ................................................ $36,561 $121,988 $462,677 $42,355
Due From (To) General Account .................................. 17,288 62,312 99,800 28,701
------- -------- -------- -------
NET ASSETS: ....................................................... $53,849 $184,300 $562,477 $71,056
======= ======== ======== =======
UNIT VALUE AT JUNE 30, 2000 (Note 5) .............................. $ 3.44 $ 31.19 $ 31.55 $ 26.09
======= ======== ======== =======
NUMBER OF UNITS OUTSTANDING AT
JUNE 30, 2000 (Note 5) ......................................... 15,643 5,908 17,831 2,724
======= ======== ======== =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENT OF OPERATIONS
For the Period April 3, 2000 (Commencement of Operations)
to June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Investment Company
-------------------------------------------------------------
Mid-Cap
Money Market All America Equity Index Equity Index
Fund Fund Fund Fund
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES:
Income (Notes 1 and 4):
Dividend Income .................................... $ -- $ -- $ -- $ --
---- -------- -------- ----
Expenses (Note 3):
Fees and administrative expenses ................... 57 714 475 13
---- -------- -------- ----
NET INVESTMENT INCOME (LOSS) .......................... (57) (714) (475) (13)
---- -------- -------- ----
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (Note 1):
Net realized gain (loss) on investments ............ 1 (67) (16) --
Net unrealized appreciation
(depreciation) of investments .................... 147 (45,135) (13,831) (35)
---- -------- -------- ----
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS ......................... 148 (45,202) (13,847) (35)
---- -------- -------- ----
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS .......................... $ 91 $(45,916) $(14,322) $(48)
==== ======== ======== ====
</TABLE>
<TABLE>
<CAPTION>
Investment Company
----------------------------------------------------------
Aggressive
Bond Short-Term Mid-Term Composite Equity
Fund Bond Fund Bond Fund Fund Fund
-------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES:
Income (Notes 1 and 4):
Dividend Income ........................................... $ -- $ -- $ -- $ -- $ --
----- ---- ---- -------- --------
Expenses (Note 3):
Fees and administrative expenses .......................... 147 3 18 454 187
----- ---- ---- -------- --------
NET INVESTMENT INCOME (LOSS) ................................. (147) (3) (18) (454) (187)
----- ---- ---- -------- --------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS (Note 1):
Net realized gain (loss) on investments ................... (1) -- -- (13) (32)
Net unrealized appreciation
(depreciation) of investments ........................... 54 35 14 (16,076) (25,921)
----- ---- ---- -------- --------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS ................................ 53 35 14 (16,089) (25,953)
----- ---- ---- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ................................. $ (94) $ 32 $ (4) $(16,543) $(26,140)
===== ==== ==== ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENT OF OPERATIONS
For the Period April 3, 2000 (Commencement of Operations)
to June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
American
Scudder Century
----------------------------------------------- -------------
Capital VP Capital
Bond Growth International Appreciation
Fund Fund Fund Fund
----------------------------------------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES:
Income (Notes 1 and 4):
Dividend Income .................................... $ -- $ -- $ -- $ --
----- ------- ------- ---------
Expenses (Note 3):
Fees and administrative expenses ................... 43 63 28 30
----- ------- ------- ---------
NET INVESTMENT INCOME (LOSS) .......................... (43) (63) (28) (30)
----- ------- ------- ---------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS (Note 1):
Net realized gain (loss) on investments ............ -- 26 9 --
Net unrealized appreciation
(depreciation) of investments .................... 28 21,537 (3,146) 5,283
----- ------- ------- ---------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS ......................... 28 21,563 (3,137) 5,283
----- ------- ------- ---------
Net Increase (Decrease) in Net Assets
Resulting from Operations .......................... $ (15) $21,500 $(3,165) $ 5,253
===== ======= ======= =========
</TABLE>
<TABLE>
<CAPTION>
Calvert Fidelity
---------- -----------------------------------------
Social VIP VIP II VIP II
Balanced Equity-Income Contra Asset Manager
Fund Fund Fund Fund
---------- ------------- -------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES:
Income (Notes 1 and 4):
Dividend Income ............................................... $ -- $ -- $ -- $ --
---- ------- ------ -----
Expenses (Note 3):
Fees and administrative expenses .............................. 102 577 231 222
---- ------- ------ -----
NET INVESTMENT INCOME (LOSS) ..................................... (102) (577) (231) (222)
---- ------- ------ -----
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS (Note 1):
Net realized gain (loss) on investments ....................... -- (19) -- (1)
Net unrealized appreciation
(depreciation) of investments ............................... 555 (5,537) 2,237 (57)
---- ------- ------ -----
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS .................................... 555 (5,556) 2,237 (58)
---- ------- ------ -----
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ..................................... $453 $(6,133) $2,006 $(280)
==== ======= ====== =====
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENTS OF CHANGES IN NET ASSETS
For the Period April 3, 2000 (Commencement of Operations)
to June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Investment Company
-----------------------------------------------------
Money Market Fund All America Fund Equity Index Fund
----------------- ---------------- -----------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) ................... $ (57) $ (714) $ (475)
Net realized gain (loss) on investments ........ 1 (67) (16)
Net unrealized appreciation (depreciation)
of investments ............................... 147 (45,135) (13,831)
-------- ----------- ---------
Net Increase (Decrease) in net assets resulting
from operations ................................ 91 (45,916) (14,322)
-------- ----------- ---------
From Unit Transactions:
Contributions .................................. 1,068 54,332 33,426
Withdrawals .................................... (3,870) (524) (7,896)
Net Transfers (Note 6) ......................... 19,588 1,206,758 634,621
-------- ----------- ---------
Net Increase (Decrease) from unit transactions .... 16,786 1,260,566 660,151
-------- ----------- ---------
NET INCREASE (DECREASE) IN NET ASSETS ............. 16,877 1,214,650 645,829
NET ASSETS:
Beginning of Period ............................... -- -- --
-------- ----------- ---------
End of Period ..................................... $ 16,877 $ 1,214,650 $ 645,829
======== =========== =========
</TABLE>
<TABLE>
<CAPTION>
Investment Company
-----------------------------------------------------
Mid-Cap
Equity Index Fund Bond Fund Short-Term Fund
----------------- --------- ---------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) .................................. $ (13) $ (147) $ (3)
Net realized gain (loss) on investments ....................... -- (1) --
Net unrealized appreciation (depreciation)
of investments .............................................. (35) 54 35
-------- ------- ------
Net Increase (Decrease) in net assets resulting
from operations ............................................... (48) (94) 32
-------- ------- ------
From Unit Transactions:
Contributions ................................................. 1,577 3,565 237
Withdrawals ................................................... -- -- --
Net Transfers (Note 6) ........................................ 205,095 23,411 3,324
-------- ------- ------
Net Increase (Decrease) from unit transactions ................... 206,672 26,976 3,561
-------- ------- ------
NET INCREASE (DECREASE) IN NET ASSETS ............................ 206,624 26,882 3,593
NET ASSETS:
Beginning of Period .............................................. -- -- --
-------- ------- ------
End of Period .................................................... $206,624 $26,882 $3,593
======== ======= ======
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENTS OF CHANGES IN NET ASSETS
For the Period April 3, 2000 (Commencement of Operations)
to June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Investment Company
-----------------------------------------------
Mid-Term Aggressive
Bond Fund Composite Fund Equity Fund
---------- -------------- -----------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) ..................................... $ (18) $ (454) $ (187)
Net realized gain (loss) on investments .......................... -- (13) (32)
Net unrealized appreciation (depreciation)
of investments ................................................. 14 (16,076) (25,921)
------ -------- --------
Net Increase (Decrease) in net assets resulting
from operations .................................................. (4) (16,543) (26,140)
------ -------- --------
From Unit Transactions:
Contributions .................................................... 637 38,909 --
Withdrawals ...................................................... -- (793) (10,707)
Net Transfers (Note 6) ........................................... 3,477 178,907 513,670
------ -------- --------
Net Increase (Decrease) from unit transactions ...................... 4,114 217,023 502,963
------ -------- --------
NET INCREASE (DECREASE) IN NET ASSETS ............................... 4,110 200,480 476,823
NET ASSETS:
Beginning of Period ................................................. -- -- --
------ -------- --------
End of Period ....................................................... $4,110 $200,480 $476,823
====== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Scudder
---------------------------------------------------
Capital Growth
Bond Fund Fund International Fund
---------- -------------- ------------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) ..................................... $ (43) $ (63) $ (28)
Net realized gain (loss) on investments .......................... -- 26 9
Net unrealized appreciation (depreciation)
of investments ................................................... 28 21,537 (3,146)
------ ---------- --------
Net Increase (Decrease) in net assets resulting
from operations .................................................. (15) 21,500 (3,165)
------ ---------- --------
From Unit Transactions:
Contributions .................................................... 1,723 31,067 8,452
Withdrawals ...................................................... -- (1,343) (5,779)
Net Transfers (Note 6) ........................................... 5,358 963,629 250,657
------ ---------- --------
Net Increase (Decrease) from unit transactions ...................... 7,081 993,353 253,330
------ ---------- --------
NET INCREASE (DECREASE) IN NET ASSETS ............................... 7,066 1,014,853 250,165
NET ASSETS:
Beginning of Period ................................................. -- -- --
------ ---------- --------
End of Period ....................................................... $7,066 $1,014,853 $250,165
====== ========== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
STATEMENTS OF CHANGES IN NET ASSETS
For the Period April 3, 2000 (Commencement of Operations)
to June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
American Century Calvert
----------------- -------------
VP Capital Social
Appreciation Fund Balanced Fund
----------------- -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) ..................................................... $ (30) $ (102)
Net realized gain (loss) on investments .......................................... -- --
Net unrealized appreciation (depreciation) of investments ........................ 5,283 555
-------- -------
Net Increase (Decrease) in net assets resulting
from operations .................................................................. 5,253 453
-------- -------
From Unit Transactions:
Contributions .................................................................... 3,783 5,039
Withdrawals ...................................................................... (157) (4,694)
Net Transfers (Note 6) ........................................................... 149,639 53,051
-------- -------
Net Increase (Decrease) from unit transactions ...................................... 153,265 53,396
-------- -------
NET INCREASE (DECREASE) IN NET ASSETS ............................................... 158,518 53,849
NET ASSETS:
Beginning of Period ................................................................. -- --
-------- -------
End of Period ....................................................................... $158,518 $53,849
======== =======
</TABLE>
<TABLE>
<CAPTION>
Fidelity
--------------------------------------------------
VIP VIP II VIP II
Equity-Income Contra Asset Manager
Fund Fund Fund
------------- ---------- -------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income (loss) ..................................... $ (577) $ (231) $ (222)
Net realized gain (loss) on investments .......................... (19) -- (1)
Net unrealized appreciation (depreciation)
of investments ................................................. (5,537) 2,237 (57)
-------- ------- -------
Net Increase (Decrease) in net assets resulting
from operations ................................................ (6,133) 2,006 (280)
-------- ------- -------
From Unit Transactions:
Contributions .................................................... 18,751 40,833 6,729
Withdrawals ...................................................... (4,468) (5,549) (34)
Net Transfers (Note 6) ........................................... 176,150 525,187 64,641
-------- ------- -------
Net Increase (Decrease) from unit transactions ...................... 190,433 560,471 71,336
-------- ------- -------
NET INCREASE (DECREASE) IN NET ASSETS ............................... 184,300 562,477 71,056
NET ASSETS:
Beginning of Period ................................................. -- -- --
-------- ------- -------
End of Period ....................................................... $184,300 $562,477 $71,056
======== ======== =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
Separate Account No. 3 of Mutual of America Life Insurance Company ("the
Company") was established in conformity with New York Insurance Law and
commenced operations on April 3, 2000 as a unit investment trust. On that date,
the following Mutual of America Separate Account No. 3 funds became available as
investment alternatives: Money Market Fund, All America Fund, Equity Index Fund,
Mid-Cap Equity Index Fund, Bond Fund, Short-Term Bond Fund, Mid-Term Bond Fund,
Composite Fund, Aggressive Equity Fund, Scudder Bond Fund, Scudder Capital
Growth Fund, Scudder International Fund, American Century VP Capital
Appreciation Fund, Calvert Social Balanced Fund, Fidelity Investments
Equity-Income, Contrafund and Asset Manager Funds. The Mutual of America
Separate Account No. 3 funds invest in a corresponding fund of Mutual of America
Investment Corporation ("Investment Company"), portfolios of Scudder Variable
Life Investment Fund ("Scudder"), fund of American Century Variable Portfolios
Inc. ("American Century") a corresponding fund of Calvert Social Balanced
Portfolio of Calvert Variable Series, Inc. ("Calvert"), in the corresponding
portfolio of Fidelity Variable Insurance Products Fund ("Fidelity VIP") and in
corresponding portfolios of Fidelity Variable Insurance Products Fund II
("Fidelity VIP II") (collectively, "Fidelity").
Separate Account No. 3 was formed by the Company to support the operations
of the Company's variable universal life insurance policies. The assets of
Separate Account No. 3 are the property of the Company. The portion of Separate
Account No. 3's assets applicable to the policies will not be charged with
liabilities arising out of any other business the Company may conduct.
The significant accounting policies of Separate Account No. 3 are as
follows:
Investment Valuation -- Investments are made in shares of the Investment
Company, Scudder, American Century, Calvert and Fidelity and are valued at the
reported net asset values of the respective funds and portfolios.
Investment Transactions -- Investment transactions are recorded on the
trade date. Realized gains and losses on sales of investments are determined
based on the average cost of the investment sold.
Federal Income Taxes -- Separate Account No. 3 will be treated as a part
of the Company and will not be taxed separately as a "regulated investment
company" under existing law. The Company is taxed as a life insurance company
under the life insurance tax provisions of the Internal Revenue Code of 1986. No
provision for income taxes is required in the accompanying financial statements.
2. INVESTMENTS
The number of shares owned by Separate Account No. 3 and the respective
net asset values (rounded to the nearest cent) per share at June 30, 2000 are as
follows:
Number of Net Asset
Shares Value
--------- --------
Investment Company Funds:
Money Market Fund: ............................. 10,040 $ 1.22
All America Fund ............................... 309,973 3.54
Equity Index Fund .............................. 182,859 2.87
Mid-Cap Equity Index Fund ...................... 976 1.20
Bond Fund ...................................... 84,339 1.34
Short-Term Bond Fund ........................... 7,634 1.03
Mid-Term Bond Fund ............................. 10,482 0.88
Composite Fund ................................. 428,696 1.91
Aggressive Equity Fund ......................... 247,829 2.24
Scudder Portfolios:
Bond Portfolio ................................. 580 6.34
Capital Growth Portfolio--Class "A" ............ 35,686 26.47
International Portfolio--Class "A" ............. 14,720 16.23
12
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
2. INVESTMENTS (CONTINUED)
Number of Net Asset
Shares Value
--------- ---------
American Century VP Capital Appreciation Fund ........ 8,163 $16.99
Calvert Social Balanced Portfolio .................... 16,410 2.23
Fidelity Portfolios:
Equity-Income--"Initial" Class .................... 5,325 22.91
Contrafund--"Initial" Class ....................... 18,441 25.09
Asset Manager--"Initial" Class .................... 2,561 16.55
3. EXPENSES
Administrative Fees and Expenses and Cost of Insurance -- In connection
with its administrative functions, the Company deducts daily charges at an
annual rate of .40% (except for American Century for which the rate charged is
.20% and each Fidelity fund, for which the rate is .30%) from the value of the
net assets of each Fund. Monthly charges equaling the lesser of $2.00 or 1/12 of
1% of account value may also be deducted. The cost of insurance, to compensate
the Company for life insurance coverage provided under the policies, is deducted
monthly and reflected as net transfers in the accompanying financial statements.
Mortality and Expense Risk Fees -- The Company assumes the risk that
insureds may live for a shorter period of time than estimated for purposes of
current or guaranteed cost of insurance rates; for this it deducts a mortality
risk charge daily, at an annual rate of .35% (.70% before May 1, 2000), from the
value of the net assets of each Fund. An expense risk charge, deducted daily, at
an annual rate of .15% from the value of the net assets of each Fund,
compensates the Company for the risk that administrative expenses incurred will
be greater than estimated.
4. DIVIDENDS
All dividend distributions are reinvested in additional shares of the
respective funds or portfolios at net asset value. No dividend distributions
have been declared and none have been paid by the Investment Company during the
first six months of 2000. It is the Investment Company's practice to declare and
pay dividends at the end of the year.
13
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
5. FINANCIAL HIGHLIGHTS
Shown below are financial highlights for a Unit outstanding for the six
months ended June 30, 2000:
<TABLE>
<CAPTION>
Investment Company
-----------------------------------------------
Money All Equity
Market America Index
Fund Fund Fund
------- -------- ------
2000 2000 2000
---- ---- ----
<S> <C> <C> <C>
Unit value, beginning of period .................................. $ 2.11 $ 10.05 $ 3.41
====== ======== ========
Unit value, end of period ........................................ $ 2.16 $ 10.50 $ 3.38
====== ======== ========
Units outstanding, end of period ................................. 7,819 115,721 191,122
====== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Investment Company
-------------------------------------------------
Mid-Cap Short-Term
Equity Index Bond Bond
Fund Fund Fund
------------ -------- ----------
2000 2000 2000
---- ---- ----
<S> <C> <C> <C>
Unit value, beginning of period .................................. $ 1.11 $ 3.07 $ 1.28
-======= ====== ======
Unit value, end of period ........................................ $ 1.19 $ 3.17 $ 1.32
======== ====== ======
Unit outstanding, end of period .................................. 173,492 8,490 2,731
======== ====== ======
</TABLE>
<TABLE>
<CAPTION>
Investment Company
-------------------------------------------------
Mid-Term Aggressive
Bond Composite Equity
Fund Fund Fund
---------- -------- ----------
2000 2000 2000
---- ---- ----
<S> <C> <C> <C>
Unit value, beginning of period .................................. $ 1.32 $ 5.61 $ 2.85
====== ======= ========
Unit value, end of period ........................................ $ 1.34 $ 5.58 $ 2.94
====== ======= ========
Unit outstanding, end of period .................................. 3,070 35,900 161,971
====== ======= ========
</TABLE>
<TABLE>
<CAPTION>
Scudder
---------------------------------------------------
Capital
Bond Growth International
Fund Fund Fund
---------- -------- -------------
2000 2000 2000
------- ------ ----
<S> <C> <C> <C>
Unit value, beginning of period .................................. $12.73 $ 48.17 $ 25.83
====== ======= =======
Unit value, end of period ........................................ $13.07 $ 49.52 $ 22.89
====== ======= =======
Unit outstanding, end of period .................................. 541 20,493 10,930
====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
American Century Calvert
---------------- -------
VP Capital Social
Appreciation Balance
Fund Fund
---------------- -------
2000 2000
------ ------
<S> <C> <C>
Unit value, beginning of period ......................................... $17.40 $ 3.37
====== =======
Unit value, end of period ............................................... $20.33 $ 3.44
====== =======
Unit outstanding, end of period ......................................... 7,798 15,643
====== =======
</TABLE>
14
<PAGE>
MUTUAL OF AMERICA SEPARATE ACCOUNT NO. 3
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
5. FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
Fidelity
----------------------------------------------------
VIP Equity- VIP II VIP II Asset
Income Contra Manager
Fund Fund Fund
---------- ------ ------------
2000 2000 2000
------- ------ ------
<S> <C> <C> <C>
Unit value, beginning of period .................................... $32.21 $ 32.13 $ 26.40
====== ======= =======
Unit value, end of period .......................................... $31.19 $ 31.55 $ 26.09
====== ======= =======
Unit outstanding, end of period .................................... 5,908 17,831 2,724
====== ======= =======
</TABLE>
6. ASSUMPTION OF BUSINESS FROM AN AFFILIATED ENTITY
In September 1999, Mutual of America Life Insurance Company ("the
Company"), submitted to the New York Insurance Department a Plan of
Reorganization whereby the Company would prepare for the sale of its wholly
owned subsidiary, The American Life Insurance Company of New York ("American
Life"). In preparation for such sale the Company has assumed (via an assumption
reinsurance agreement) virtually all of American Life's in force business.
On April 3, 2000 the Company, upon obtaining approval from a substantial
number of American Life's policyowners, assumed these contracts, and all of the
related assets and obligations, and replaced American Life as the issuer.
Total transfers related to these contracts amounted to $4.2 million and
are included in Net Transfers on the Statements of Changes in Net Assets for
each fund. The amounts transferred for each fund for the six months ended June
30, 2000 is as follows:
Investment Company Money Market Fund ....................... $ 9,342
Investment Company All America Fund ........................ 1,065,521
Investment Company Equity Index Fund ....................... 536,403
Investment Company Mid-Cap Equity Index Fund ............... 933
Investment Company Bond Fund ............................... 26,237
Investment Company Short-Term Bond Fund .................... 1,191
Investment Company Mid-Term Bond Fund ...................... 2,814
Investment Company Composite Fund .......................... 357,426
Investment Company Aggressive Equity Fund .................. 338,824
Scudder Bond Fund .......................................... 3,650
Scudder Capital Growth Fund ................................ 862,704
Scudder International Fund ................................. 196,485
American Century VP Capital Appreciation Fund .............. 132,433
Calvert Social Balanced Fund ............................... 35,528
Fidelity VIP Equity-Income Fund ............................ 126,986
Fidelity VIP II Contra Fund ................................ 459,285
Fidelity VIP II Asset Manager Fund ......................... 42,426
15
<PAGE>
MUTUAL OF AMERICA
LIFE INSURANCE COMPANY
320 PARK AVENUE
NEW YORK, NY 10022-6839
212-224-1600
www.mutualofamerica.com
