Washington National Variable Annuity Fund B
Annual Report as of December 31, 1995
We enclose for your information our Annual Report reflecting the financial
condition of Washington National Variable Annuity Fund B at December 31, 1995.
The value of a contract owner's accumulation unit in the Fund in 1995 and 1994
was $13.536518 and $10.200792, respectively. Total contract owners' equity in
1995 and 1994 was $776,751 and $607,119, respectively.
Washington National Variable Annuity Fund B, a segregated investment
account established by Washington National Insurance Company, invests its
funds at net asset value in shares of Fundamental Investors, Inc., a mutual
fund managed by Capital Research and Management Co. of Los Angeles, California.
The principal investment objective of the mutual fund is the increase of
capital and income over the years.
The operating results of Fundamental Investors, Inc., for the year ended
December 31, 1995, may be found in its Annual Report, a copy of which is
enclosed with this report.
January 12, 1996
/c/ Robert W. Patin
Robert W. Patin, Chairman of the Board
Washington National Insurance Company
<PAGE>
Report of Independent Auditors
Contract Owners
Washington National Variable Annuity Fund B
We have audited the accompanying statement of assets and contract owners'
equity of Washington National Variable Annuity Fund B as of December 31, 1995,
and the related statements of operations and changes in contract owners'
equity for each of the two years in the period then ended, and the selected
per share data and ratios for each of the five years in the period then ended.
These financial statements and per share data and ratios are the responsibility
of the Fund's management. Our responsibility is to express an opinion on
these financial statements and per share data and ratios based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and per
share data and ratios are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of the
investment owned as of December 31, 1995 by correspondence with Fundamental
Investors, Inc. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and selected per share data and
ratios referred to above present fairly, in all material respects, the
financial position of Washington National Variable Annuity Fund B at
December 31, 1995, and the results of its operations and changes in contract
owners' equity for each of the two years in the period then ended, and
selected per share data and ratios for each of the five years in the period
then ended, in conformity with generally accepted accounting principles.
/c/ Ernst & Young LLP
Chicago, Illinois
January 12, 1996
<PAGE>
<TABLE>
Washington National Variable Annuity Fund B
STATEMENT OF ASSETS AND CONTRACT OWNERS' EQUITY
<CAPTION>
December 31, 1995
<S> <C>
ASSETS
Investment in Fundamental Investors, Inc.-at net
asset value, $22.29 a share (cost, $262,893)-Note B $ 757,328
Cash 19,423
$ 776,751
CONTRACT OWNERS' EQUITY
Value of 38,604 accumulation units ($13.536518 per unit) $ 522,567
Annuity reserves (18,778 equivalent accumulation units) 254,184
$ 776,751
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN CONTRACT
OWNERS' EQUITY
<CAPTION>
Year Ended December 31
--------------------------
1995 1994
<S> <C> <C>
Additions (deductions):
From investment activities:
Net investment income $ 29,180 $ 23,719
Net realized and unrealized gains (losses) on investment 163,475 (21,766)
INCREASE IN CONTRACT OWNERS' EQUITY
FROM INVESTMENT ACTIVITIES 192,655 1,953
From capital transactions:
Annuity payments (37,058) (32,555)
Mortality assurance adjustment 18,811 11,807
Withdrawals and contracts surrendered (4,776) (23,119)
DECREASE IN CONTRACT OWNERS'
EQUITY FROM CAPITAL TRANSACTIONS (23,023) (43,867)
NET INCREASE (DECREASE) IN
CONTRACT OWNERS' EQUITY 169,632 (41,914)
Contract owners' equity:
Beginning of year 607,119 649,033
End of year $776,751 $607,119
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF OPERATIONS
<CAPTION>
Year Ended December 31
--------------------------
1995 1994
<S> <C> <C>
Investment income:
Dividends $ 13,503 $ 14,884
Capital gains dividends 22,687 15,098
Less mortality and expense assurance-Note C (7,010) (6,263)
NET INVESTMENT INCOME $ 29,180 $ 23,719
Realized and unrealized gains (losses) on investment:
Realized gains $ 4,563 $ 518
Unrealized gains (losses) on investment:
End of year 494,435 335,523
Beginning of year 335,523 357,807
UNREALIZED GAINS (LOSSES) 158,912 (22,284)
NET REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENT $163,475 $(21,766)
<FN>
See notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
SUPPLEMENTARY INFORMATION -
SELECTED PER SHARE DATA AND RATIOS
Selected data for a share of accumulation
unit outstanding throughout each year:
<CAPTION>
Year Ended December 31
-----------------------------------------------
1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Per share data:
Dividend and capital gain dividend income $ .63 $ .50 $ 1.19 $ .64 $ .47
Mortality and expense assurance (.12) (.10) (.10) (.01) (.07)
Net investment income .51 .40 1.09 .63 .40
Net realized and unrealized gains (losses)
on investment 2.83 (.38) .38 .09 1.39
Net increase in accumulation
unit values 3.34 .02 1.47 .72 1.79
Accumulation unit value:
Beginning of year 10.20 10.18 8.71 7.99 6.20
End of year $13.54 $10.20 $10.18 $ 8.71 $ 7.99
Ratios:
Ratio of mortality and expense assurance to
average value of accumulation units 1.01% 1.02% 1.02% .06% 1.02%
Ratio of net investment income to
average value of accumulation units 4.21 3.86 11.53 7.83 5.51%
<FN>
See notes to financial statements.
</TABLE>
<PAGE>
Washington National Variable Annuity Fund B
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
NOTE A - THE FUND
The Washington National Variable Annuity Fund B (the
"Fund") is a segregated investment account of
Washington National Insurance Company ("WNIC").
WNIC is a wholly-owned subsidiary of Washington
National Corporation. The Fund is registered as a unit
investment trust under the Investment Company Act of
1940. The Fund no longer accepts purchase payments.
NOTE B - INVESTMENT
Net asset value of Fund shares represents the year-end
market value of the shares.
Realized gains and losses on investment are determined
on a specific cost basis. The aggregate cost of
purchases of investment in 1995 and 1994 was $36,190 and
$29,983, respectively. The aggregate proceeds from sales
of investment in 1995 and 1994 were $36,856 and $48,274,
respectively.
NOTE C - DEDUCTIONS FOR MORTALITY AND
EXPENSE ASSURANCE
Deductions were made from the current value of the
Fund and paid to WNIC representing .000028 per daily
valuation period (annual basis of 1.022%) of the current
value of the Fund for mortality and expense assurance.
NOTE D - FEDERAL INCOME TAXES
The operations of the Fund form a part of, and are taxed
with, the operations of WNIC, which under the Internal
Revenue Code is taxed as a "life insurance company".
The Fund will not be taxed as a regulated investment
company under subchapter M of the Code. Under
existing federal income tax law, no taxes are payable on
the investment income or on the realized gains of the
Fund.
<PAGE>
NOTES TO FINANCIAL
STATEMENTS - (continued)
NOTE E - ACCUMULATION UNITS
A summary of the additions (deductions) in accumula-
tion units follows:
<TABLE>
<CAPTION>
Year Ended December 31
---------------------------------
1995 1994
<C> <C>
Balance at
beginning
of year 59,516.836 63,779.997
Annuity
payments (3,080.898) (3,188.701)
Withdrawals
and contracts
surrendered (443.644) (2,231.888)
Mortality
assurance
adjustment 1,389.657 1,157.428
BALANCE AT
END OF YEAR 57,381.951 59,516.836
</TABLE>
This report is submitted for the general information of owners
of Washington National Variable Annuity Fund B contracts. The
report is not authorized for distribution to prospective
purchasers of variable annuity contracts unless it
is accompanied by an effective prospectus.
The registrant hereby incorporates by reference the 1995 Annual
Report of Fundamental Investors, file number 811-32, filed with
the Commission on March 4, 1996.
