<PAGE> 1
MFS
VARIABLE
ACCOUNT
SEMI-ANNUAL REPORT
TO
CONTRACT OWNERS
JUNE 30, 1996
NATIONWIDE LIFE INSURANCE COMPANY
HOME OFFICE: COLUMBUS, OHIO [NATIONWIDE LOGO]
APO-719-U (6/96)
<PAGE> 2
[NATIONWIDE LOGO]
NATIONWIDE LIFE INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43215
[PHOTO]
PRESIDENT'S MESSAGE
We are pleased to present the 1996 semi-annual report of the MFS Variable
Account.
Equity investments provided a respectable return for the first half of 1996 with
the major market indices holding comfortably in double digits. Fixed-income
investments, however, did not perform as well with the average bond fund showing
slightly negative performance for the period. This was due to rising interest
rates and lingering inflation fears.
The U.S. economy showed signs of increasing strength during the first half of
the year. The question remains: will growth fall back to the perceived
inflation-free path by itself or will the Federal Reserve have to step in and
enforce moderation? Recent economic statistics, such as the July unemployment
report, point in the direction of some moderation. Also, fierce competition in
all consumer-goods markets make inflationary price increases very difficult. One
way or the other, we expect slower economic growth in the near future.
Financial assets will remain the preferred individual investment option because
they will continue providing security, liquidity, and income and growth.
We appreciate your confidence in the Nationwide Insurance Enterprise and in our
life and annuity products. You have our assurance that your personal
satisfaction with our products and service is our highest priority.
/s/ Joseph J. Gasper
Joseph J. Gasper, President
3
<PAGE> 3
MFS VARIABLE ACCOUNT
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS' EQUITY
JUNE 30, 1996
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments at market value:
MFS Series Trust IV - MFS(R) Money Market Fund (MFSMyMkt)
62,360,184 shares (cost $62,360,184) ....................... $ 62,360,184
Massachusetts Investors Growth Stock Fund - Class A (MFSGrStk)
3,171,000 shares (cost $35,305,778) ........................ 38,273,972
Massachusetts Investors Trust - Class A (MFSInvTr)
2,691,987 shares (cost $32,858,920) ........................ 37,553,219
MFS(R) Bond Fund - Class A (MFSBdFd)
2,742,286 shares (cost $36,944,735) ........................ 35,156,103
MFS(R) Emerging Growth Fund - Class A (MFSEmGro)
500,598 shares (cost $10,699,826) .......................... 15,253,209
MFS(R) Growth Opportunities Fund - Class A (MFSGrOpp)
8,731,590 shares (cost $97,796,888) ........................ 117,527,198
MFS(R) High Income Fund - Class A (MFSHiInc)
6,470,078 shares (cost $33,265,647) ........................ 33,385,604
MFS(R) Research Fund - Class A (MFSRsrch)
2,408,773 shares (cost $32,270,698) ........................ 42,900,246
MFS(R) Total Return Fund - Class A (MFSTotRe)
4,694,138 shares (cost $59,285,462) ........................ 69,426,295
MFS(R) World Governments Fund - Class A (MFSWdGvt)
831,860 shares (cost $9,779,091) ........................... 9,083,909
Nationwide Separate Account Trust-Money Market Fund (NSATMyMkt)
2,063,989 shares (cost $2,063,989) ......................... 2,063,989
------------
Total investments ....................................... 462,983,928
Accounts receivable .............................................. 165,532
------------
Total assets ............................................ 463,149,460
ACCOUNTS PAYABLE .................................................... 3,913
------------
CONTRACT OWNERS' EQUITY (NOTE 4) .................................... $463,145,547
============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 4
MFS VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995 1994
------------ ------------ ------------
<S> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested capital gains and dividends ........... $ 6,118,259 6,980,030 6,460,711
------------ ------------ ------------
Gain (loss) on investments:
Proceeds from redemptions of mutual fund shares 56,505,987 54,954,049 65,315,354
Cost of mutual fund shares sold ............... (52,669,337) (54,493,977) (62,650,783)
------------ ------------ ------------
Realized gain (loss) on investments ........... 3,836,650 406,072 2,664,571
Change in unrealized gain (loss) on investments 24,016,926 46,388,643 (32,029,253)
------------ ------------ ------------
Net gain (loss) on investments ............. 27,853,576 46,848,715 (29,364,682)
------------ ------------ ------------
Net investment activity ................. 33,971,835 53,828,745 (22,903,971)
------------ ------------ ------------
EQUITY TRANSACTIONS:
Purchase payments received from contract owners .. 10,517,484 9,396,786 8,455,123
Redemptions ...................................... (32,532,427) (38,892,976) (40,513,572)
Annuity benefits ................................. (287,998) (253,123) (267,199)
Adjustments to maintain reserves ................. 29,011 36,989 (1,463)
------------ ------------ ------------
Net equity transactions ................. (22,273,930) (29,712,324) (32,327,111)
------------ ------------ ------------
EXPENSES:
Contract charges ................................. (3,239,835) (3,027,855) (3,317,358)
Contingent deferred sales charges ................ (74,416) (117,137) (119,530)
------------ ------------ ------------
Total expenses .......................... (3,314,251) (3,144,992) (3,436,888)
------------ ------------ ------------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............... 8,383,654 20,971,429 (58,667,970)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ......... 454,761,893 416,902,565 491,495,453
------------ ------------ ------------
CONTRACT OWNERS' EQUITY END OF PERIOD ............... $ 463,145,547 437,873,994 432,827,483
============ ============ ============
</TABLE>
See accompanying notes to financial statements.
5
<PAGE> 5
MFS VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
(1) Summary of Significant Accounting Policies
(a) Organization and Nature of Operations
MFS Variable Account (the Account) was established by resolution of the
Board of Directors of Nationwide Life Insurance Company (the Company) on March
3, 1976. The Account has been registered as a unit investment trust under the
Investment Company Act of 1940.
The Company offers tax qualified and non-tax qualified Individual Deferred
Variable Annuity Contracts through the Account. The primary distribution for the
contracts is through Massachusetts Financial Services. Presently, the
contracts are not actively marketed.
(b) The Contracts
Prior to February 12, 1979, the contracts purchased provided for a
front-end sales charge and certain other fees. Beginning February 12, 1979, only
contracts (Spectrum) without a front-end sales charge but with a contingent
deferred sales charge and certain other fees were offered for purchase. See note
2 for a discussion of contract expenses.
With certain exceptions, contract owners in either the accumulation or
payout phase may invest in any of the following funds:
MFS Series Trust IV - MFS(R) Money Market Fund (MFSMyMkt)
(formerly Massachusetts Cash Management Trust - MFS(R) Money
Market Fund)
Massachusetts Investors Growth Stock Fund - Class A (MFSGrStk)
Massachusetts Investors Trust - Class A (MFSInvTr)
MFS(R) Bond Fund - Class A (MFSBdFd)
MFS(R) Emerging Growth Fund - Class A (MFSEmGro)
MFS(R) Growth Opportunities Fund - Class A (MFSGrOpp)
MFS(R) High Income Fund - Class A (MFSHiInc)
MFS(R) Research Fund - Class A (MFSRsrch)
MFS(R) Total Return Fund - Class A (MFSTotRe)
MFS(R) World Governments Fund - Class A (MFSWdGvt)
Nationwide Separate Account Trust-Money Market Fund (NSATMyMkt)
(managed for a fee by an affiliated investment advisor)
At June 30, 1996, contract owners have invested in all of the above funds.
The contract owners' equity is affected by the investment results of each fund,
equity transactions by contract owners and certain contract expenses (see note
2). The accompanying financial statements include only contract owners' purchase
payments pertaining to the variable portions of their contracts and exclude any
purchase payments for fixed dollar benefits, the latter being included in the
accounts of the Company.
(c) Security Valuation, Transactions and Related Investment Income
The market value of the underlying mutual funds is based on the closing
net asset value per share at June 30, 1996. The cost of investments sold is
determined on the specific identification basis. Investment transactions are
accounted for on the trade date (date the order to buy or sell is executed) and
dividend income is recorded on the ex-dividend date.
6
<PAGE> 6
(d) Federal Income Taxes
Operations of the Account form a part of, and are taxed with, operations
of the Company which is taxed as a life insurance company under the Internal
Revenue Code.
The Internal Revenue Service issued Rev. Rul. 81-225 on September 25, 1981
and IR-82-19 on February 3, 1982. The effect of Rev. Rul. 81-225 was to treat
non-tax qualified contract holders, who purchased contracts or made purchase
payments after December 31, 1980, as the owners of the underlying mutual
fund shares for Federal income tax purposes. However, for 1981, IR-82-19 did
provide limited relief from the ruling. Therefore, the Company maintained a
capital gain reserve liability, for all realized and unrealized capital gains
existing on or before December 31, 1981.
During 1982 and most of 1983, the Company continued to maintain contract
values which reflected a capital gain reserve liability for those contracts and
contract values affected by Rev. Rul. 81-225. On December 16, 1983, the Company
adjusted the affected (81-225) contract values in order to treat the respective
contract owners as the owners of the underlying shares for Federal income tax
purposes, as intended by the ruling. As a result of this adjustment, contract
owners equity was restored with amounts previously deducted to maintain the
capital gain reserve liability.
Because of the aforementioned, the Company no longer provides for income
taxes within the Account. Presently, taxes are the responsibility of the
contract owner upon termination or withdrawal.
(e) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles may require management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities, if any, 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.
(2) Expenses
Net purchase payments received on contracts issued before February 12,
1979 represent gross contributions by the contract owners less a charge of 7.75%
by the Company to cover sales expenses.The Company does not deduct a sales
charge from purchase payments made for contracts issued beginning February 12,
1979. However, if any part of the contract value of such contracts is
surrendered the Company will, with certain exceptions, deduct from the owner's
contract value a contingent deferred sales charge equal to 5% of the lesser of
the total of all purchase payments made within 96 months prior to the date of
the request for surrender, or the amount surrendered; no sales charges are
deducted on redemptions used to purchase units in the fixed investment options
of the Company.
The following administrative charges are deducted by the Company on each
contract issued prior to February 12, 1979: (a) a contract issue charge of $15
assessed against the initial purchase payment and a $15 annual contract
maintenance charge assessed against each contract by surrendering units; and (b)
a charge for mortality and expense risk assessed through the daily unit value
calculation equal to an annual rate of 0.80% and 0.20%, respectively.
Administrative charges on contracts issued beginning February 12, 1979 include:
(a) an annual contract maintenance charge of $30 which is satisfied by
surrendering units; and (b) a charge for mortality and expense risk assessed
through the daily unit value calculation equal to an annual rate of 0.80% and
0.50%, respectively.
7
<PAGE> 7
(3) Schedule I
Schedule I presents the components of the change in the unit values, which
are the basis for contract owners' equity. This schedule is presented for each
series, as applicable, in the following format:
- Beginning unit value - Jan. 1
- Reinvested capital gains and dividends
(This amount reflects the increase in the unit value due to
capital gains and dividend distributions from the underlying
mutual funds.)
- Unrealized gain (loss)
(This amount reflects the increase (decrease) in the unit value
resulting from the market appreciation (depreciation) of the
underlying mutual funds.)
- Contract charges
(This amount reflects the decrease in the unit value due to the
mortality and expense risk fee discussed in note 2.)
- Ending unit value - June 30
- Percentage increase (decrease) in unit value.
For contracts in the payout phase, an assumed investment return of 3.5%,
used in the calculation of the annuity benefit payment amount, results in a
corresponding reduction in the components of the unit values as shown in
Schedule I.
8
<PAGE> 8
(4) Components of Contract Owners' Equity
The following is a summary of contract owners' equity at June 30, 1996,
for each series, in both the accumulation and payout phases. Due to the nature
of money market funds, an 81-225 adjustment (See note 1(d)) was not required for
either the MFS Series Trust IV - MFS(R) Money Market Fund or the Nationwide
Separate Account Trust - Money Market Fund.
Contract owners' equity represented by:
<TABLE>
<CAPTION>
UNITS UNIT VALUE
--------- ------------
<S> <C> <C> <C>
Contracts in accumulation phase:
MFS Series Trust IV - MFS(R) Money Market Fund:
Non-tax qualified................................. 4,058 $ 34.587684 $ 140,357
Tax qualified spectrum............................ 1,455,102 29.542162 42,986,859
Non-tax qualified spectrum........................ 628,756 29.562691 18,587,719
Massachusetts Investors Growth Stock Fund - Class A:
Non-tax qualified................................. 1,043 87.944302 91,726
Tax qualified spectrum............................ 327,135 93.213973 30,493,553
Non-tax qualified spectrum........................ 93,365 79.096823 7,384,875
Non-tax qualified spectrum (81-225)............... 2,113 86.165785 182,068
Massachusetts Investors Trust - Class A:
Tax qualified..................................... 16 111.117617 1,778
Tax qualified spectrum............................ 337,304 89.312562 30,125,484
Non-tax qualified spectrum........................ 89,050 80.134822 7,136,006
Non-tax qualified spectrum (81-225)............... 2,380 85.135305 202,622
MFS(R) Bond Fund - Class A:
Non-tax qualified................................. 596 49.242174 29,348
Tax qualified spectrum............................ 580,519 42.298368 24,555,006
Non-tax qualified spectrum........................ 237,623 42.263789 10,042,848
Non-tax qualified spectrum (81-225)............... 2,381 42.429074 101,024
MFS(R) Emerging Growth Fund - Class A:
Tax qualified spectrum............................ 443,432 34.281371 15,201,457
Non-tax qualified spectrum (81-225)............... 1,516 34.281371 51,971
MFS(R) Growth Opportunities Fund - Class A:
Non-tax qualified................................. 3,137 116.154368 364,376
Tax qualified spectrum............................ 890,636 108.187179 96,355,396
Non-tax qualified spectrum........................ 198,700 91.898835 18,260,299
Non-tax qualified spectrum (81-225................ 14,963 101.400023 1,517,249
MFS(R) High Income Fund - Class A:
Non-tax qualified................................. 358 59.893130 21,442
Tax qualified spectrum............................ 445,493 52.585403 23,426,429
Non-tax qualified spectrum........................ 174,942 51.787636 9,059,833
Non-tax qualified spectrum (81-225)............... 6,427 52.585403 337,966
MFS(R) Research Fund - Class A:
Non-tax qualified................................. 599 114.414551 68,534
Tax qualified spectrum............................ 279,812 113.152375 31,661,392
Non-tax qualified spectrum........................ 108,227 98.869044 10,700,300
Non-tax qualified spectrum (81-225)............... 1,734 111.831595 193,916
MFS(R) Total Return Fund - Class A:
Tax qualified..................................... 131 83.254731 10,906
Tax qualified spectrum............................ 723,319 76.435952 55,287,576
Non-tax qualified spectrum........................ 185,988 73.987452 13,760,778
Non-tax qualified spectrum (81-225)............... 1,641 75.692333 124,211
MFS(R) World Governments Fund - Class A:
Tax qualified spectrum............................ 159,852 48.156115 7,697,851
Non-tax qualified spectrum........................ 25,492 46.949100 1,196,826
Non-tax qualified spectrum (81-225)............... 2,553 48.081257 122,751
Nationwide Separate Account Trust - Money Market Fund:
Tax qualified spectrum............................ 58,494 22.366524 1,308,307
Non-tax qualified spectrum........................ 33,760 22.381071 755,585
========= ==========
Reserves for annuity contracts in payout phase:
Tax qualified..................................... 50,906
Non-tax qualified................................. 72,954
Tax qualified spectrum............................ 2,387,241
Non-tax qualified spectrum........................ 1,080,701
Non-tax qualified spectrum (81-225)............... 7,121
------------
$ 463,145,547
============
</TABLE>
9
<PAGE> 9
SCHEDULE I
MFS VARIABLE ACCOUNT
TAX QUALIFIED
SCHEDULES OF CHANGES IN UNIT VALUE
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
MFSINVTR MFSBDFD MFSTOTRE
-------- ------- --------
<S> <C> <C> <C>
1996***
Beginning unit value - Jan. 1 $101.007177 ** 79.840336
- ----------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .793267 1.683144
- ----------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 9.848696 2.139837
- ----------------------------------------------------------------------------------------------------------------------
Contract charges (.531523) (.408586)
- ----------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $111.117617 83.254731
- ----------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 10% 4%
======================================================================================================================
1995***
Beginning unit value - Jan. 1 $ 73.217470 ** 63.581031
- ----------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .893498 1.596993
- ----------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 12.873592 7.266893
- ----------------------------------------------------------------------------------------------------------------------
Contract charges (.400338) (.342854)
- ----------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $ 86.584222 72.102063
- ----------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 18% 13%
======================================================================================================================
1994***
Beginning unit value - Jan. 1 $ 74.716077 42.399834 65.964662
- ----------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .778857 1.303901 1.357255
- ----------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (2.529846) (3.745988) (3.374094)
- ----------------------------------------------------------------------------------------------------------------------
Contract charges (.372841) (.205447) (.319270)
- ----------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $ 72.592247 39.752300 63.628553
- ----------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* (3)% (6)% (4)%
======================================================================================================================
<FN>
* This is not an annualized rate of return as it is the change for a six month period and contract charges do not
include the annual contract maintenance charge discussed in note 2.
** This investment option was not being utilized.
*** No other investment options were being utilized.
</TABLE>
10
<PAGE> 10
SCHEDULE I, CONTINUED
MFS VARIABLE ACCOUNT
NON-TAX QUALIFIED
SCHEDULES OF CHANGES IN UNIT VALUE
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
MFSMYMKT MFSGRSTK MFSBDFD MFSGROPP MFSHIINC MFSRSRCH MFSTOTRE
-------- -------- ------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1996***
Beginning unit value - Jan. 1 $33.966291 77.839871 50.922705 103.553065 57.870879 100.977005 **
- ---------------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .792058 .000000 1.805894 .000000 2.516857 .000000
- ---------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 10.519829 (3.239733) 13.154927 (.199371) 13.977335
- ---------------------------------------------------------------------------------------------------------------------------------
Contract charges (.170665) (.415398) (.246692) (.553624) (.295235) (.539789)
- ---------------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $34.587684 87.944302 49.242174 116.154368 59.893130 114.414551
- ---------------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 13% (3)% 12% 3% 13%
=================================================================================================================================
1995***
Beginning unit value - Jan. 1 $32.595660 61.261465 42.342529 77.773322 49.895862 73.593263 62.479885
- ---------------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .859590 .000000 1.699492 .000000 2.293809 .000000 1.569331
- ---------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 10.292436 4.037530 15.479139 2.727424 12.750101 7.141045
- ---------------------------------------------------------------------------------------------------------------------------------
Contract charges (.165444) (.322256) (.225017) (.420941) (.265101) (.395948) (.336918)
- ---------------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $33.289806 71.231645 47.854534 92.831520 54.651994 85.947416 70.853343
- ---------------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 16% 13% 19% 10% 17% 13%
=================================================================================================================================
1994***
Beginning unit value - Jan. 1 $31.804010 66.343035 44.767184 81.961605 51.758789 74.327082 64.822235
- ---------------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .435996 .000000 1.376701 .000000 2.195292 .000000 1.333756
- ---------------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 (8.878516) (3.955140) (7.416311) (4.007914) (3.061263) (3.315670)
- ---------------------------------------------------------------------------------------------------------------------------------
Contract charges (.159309) (.311402) (.216918) (.399107) (.254196) (.371460) (.313737)
- ---------------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $32.080697 57.153117 41.971827 74.146187 49.691971 70.894359 62.526584
- ---------------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 1% (14)% (6)% (10)% (4)% (5)% (4)%
=================================================================================================================================
<FN>
* This is not an annualized rate of return as it is the change for a six month
period and contract charges do not include the annual contract maintenance
charge discussed in note 2.
** This investment option was not being utilized.
*** No other investment options were being utilized.
</TABLE>
11
<PAGE> 11
SCHEDULE I, CONTINUED
MFS VARIABLE ACCOUNT
TAX QUALIFIED SPECTRUM
SCHEDULES OF CHANGES IN UNIT VALUE
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
MFSMYMKT MFSGRSTK MFSINVTR MFSBDFD MFSEMGRO MFSGROPP MFSHIINC
-------- -------- -------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
1996
Beginning unit value - Jan. 1 $29.055232 82.628565 81.308640 43.808005 30.247061 96.595726 50.886631
- -----------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .676858 .000000 .637857 1.552557 .000000 .000000 2.211694
- -----------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 11.159074 7.922710 (2.786090) 4.246060 12.263307 (.175161)
- -----------------------------------------------------------------------------------------------------------------------------
Contract charges (.189928) (.573666) (.556645) (.276104) (.211750) (.671854) (.337761)
- -----------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $29.542162 93.213973 89.312562 42.298368 34.281371 108.187179 52.585403
- -----------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 13% 10% (3)% 13% 12% 3%
=============================================================================================================================
1995
Beginning unit value - Jan. 1 $27.967294 65.227303 59.116939 36.536936 21.706658 72.767772 44.007083
- -----------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .737063 .000000 .720618 1.465521 .000000 .000000 2.021820
- -----------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 10.947366 10.386873 3.480954 3.658108 14.470225 2.404312
- -----------------------------------------------------------------------------------------------------------------------------
Contract charges (.184672) (.446385) (.420519) (.252597) (.151697) (.512387) (.304214)
- -----------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $28.519685 75.728284 69.803911 41.230814 25.213069 86.725610 48.129001
- -----------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 16% 18% 13% 16% 19% 9%
=============================================================================================================================
1994
Beginning unit value - Jan. 1 $27.370768 70.852048 60.509797 38.746280 20.977490 76.918993 45.788518
- -----------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .374971 .000000 .630073 1.190642 .000000 .000000 1.940884
- -----------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 (9.473776) (2.045676) (3.420446) (1.809190) (6.952028) (3.542839)
- -----------------------------------------------------------------------------------------------------------------------------
Contract charges (.178372) (.432675) (.392841) (.244267) (.136982) (.487298) (.292569)
- -----------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $27.567367 60.945597 58.701353 36.272209 19.031318 69.479667 43.893994
- -----------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 1% (14)% (3)% (6)% (9)% (10)% (4)%
=============================================================================================================================
<CAPTION>
MFSRSRCH MFSTOTRE MFSWDGVT NSATMYMKT
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
1996
Beginning unit value - Jan. 1 100.013750 73.411912 48.914346 21.961256
- ------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.546679 .000000 .548975
- ------------------------------------------------------------------------------------
Unrealized gain (loss) 13.834171 1.966134 (.446821) .000000
- ------------------------------------------------------------------------------------
Contract charges (.695546) (.488773) (.311410) (.143707)
- ------------------------------------------------------------------------------------
Ending unit value - June 30 113.152375 76.435952 48.156115 22.366524
- ------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 13% 4% (2)% 2%
====================================================================================
1995
Beginning unit value - Jan. 1 73.111959 58.638949 42.911877 21.058716
- ------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.471900 .000000 .595236
- ------------------------------------------------------------------------------------
Unrealized gain (loss) 12.656116 6.697606 5.177061 .000000
- ------------------------------------------------------------------------------------
Contract charges (.511753) (.411359) (.297662) (.139205)
- ------------------------------------------------------------------------------------
Ending unit value - June 30 85.256322 66.397096 47.791276 21.514747
- ------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 17% 13% 11% 2%
====================================================================================
1994
Beginning unit value - Jan. 1 74.064821 61.021714 46.532702 20.538004
- ------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.254926 .581237 .324441
- ------------------------------------------------------------------------------------
Unrealized gain (loss) (3.045345) (3.120266) (4.518205) .000000
- ------------------------------------------------------------------------------------
Contract charges (.481567) (.384236) (.283499) (.133993)
- ------------------------------------------------------------------------------------
Ending unit value - June 30 70.537909 58.772138 42.312235 20.728452
- ------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* (5)% (4)% (9)% 1%
====================================================================================
<FN>
* This is not an annualized rate of return as it is the change for a six month
period and contract charges do not include the annual contract maintenance
charge discussed in note 2.
</TABLE>
12
<PAGE> 12
SCHEDULE I, CONTINUED
MFS VARIABLE ACCOUNT
NON-TAX QUALIFIED SPECTRUM
SCHEDULES OF CHANGES IN UNIT VALUE
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
MFSMYMKT MFSGRSTK MFSINVTR MFSBDFD MFSGROPP MFSHIINC
-------- -------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1996
Beginning unit value - Jan. 1 $29.075421 70.114570 72.953374 43.772192 82.052560 50.114634
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .677334 .000000 .572311 1.551287 .000000 2.178115
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 9.469034 7.108580 (2.783806) 10.416991 (.172490)
- ------------------------------------------------------------------------------------------------------------------------
Contract charges (.190064) (.486781) (.499443) (.275884) (.570716) (.332623)
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $29.562691 79.096823 80.134822 42.263789 91.898835 51.787636
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 13% 10% (3)% 12% 3%
========================================================================================================================
1995
Beginning unit value - Jan. 1 $27.986728 55.348697 53.042089 36.507070 61.812074 43.339456
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .737579 .000000 .646567 1.464324 .000000 1.991133
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 9.289403 9.319525 3.478098 12.291632 2.367840
- ------------------------------------------------------------------------------------------------------------------------
Contract charges (.184805) (.378778) (.377310) (.252384) (.435245) (.299589)
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $28.539502 64.259322 62.630871 41.197108 73.668461 47.398840
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 2% 16% 18% 13% 19% 9%
========================================================================================================================
1994
Beginning unit value - Jan. 1 $27.389788 60.121583 54.291825 38.714601 65.338300 45.093866
- ------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .375226 .000000 .565326 1.189669 .000000 1.911426
- ------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) .000000 (8.038978) (1.835464) (3.417644) (5.905353) (3.489080)
- ------------------------------------------------------------------------------------------------------------------------
Contract charges (.178491) (.367150) (.352472) (.244065) (.413932) (.288128)
- ------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $27.586523 51.715455 52.669215 36.242561 59.019015 43.228084
- ------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 1% (14)% (3)% (6)% (10)% (4)%
========================================================================================================================
<CAPTION>
MFSRSRCH MFSTOTRE MFSWDGVT NSATMYMKT
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
1996
Beginning unit value - Jan. 1 87.388917 71.060281 47.688325 21.975540
- ---------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.497102 .000000 .549336
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss) 12.087871 1.903172 (.435630) .000000
- ---------------------------------------------------------------------------------------------
Contract charges (.607744) (.473103) (.303595) (.143805)
- ---------------------------------------------------------------------------------------------
Ending unit value - June 30 98.869044 73.987452 46.949100 22.381071
- ---------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 13% 4% (2)% 2%
=============================================================================================
1995
Beginning unit value - Jan. 1 63.882963 56.760546 41.836304 21.072414
- ---------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.424774 .000000 .595624
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss) 11.058518 6.483046 5.047305 .000000
- ---------------------------------------------------------------------------------------------
Contract charges (.447154) (.398192) (.290208) (.139296)
- ---------------------------------------------------------------------------------------------
Ending unit value - June 30 74.494327 64.270174 46.593401 21.528742
- ---------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 17% 13% 11% 2%
=============================================================================================
1994
Beginning unit value - Jan. 1 64.715547 59.066983 45.366368 20.551361
- ---------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.214739 .566669 .324652
- ---------------------------------------------------------------------------------------------
Unrealized gain (loss) (2.660931) (3.020319) (4.404950) .000000
- ---------------------------------------------------------------------------------------------
Contract charges (.420777) (.371934) (.276394) (.134079)
- ---------------------------------------------------------------------------------------------
Ending unit value - June 30 61.633839 56.889469 41.251693 20.741934
- ---------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* (5)% (4)% (9)% 1%
=============================================================================================
<FN>
* This is not an annualized rate of return as it is the change for a six month
period and contract charges do not include the annual contract maintenance
charge discussed in note 2.
</TABLE>
13
<PAGE> 13
SCHEDULE I, CONTINUED
MFS VARIABLE ACCOUNT
NON-TAX QUALIFIED SPECTRUM (81-225)
SCHEDULES OF CHANGES IN UNIT VALUE
SIX MONTH PERIODS ENDED JUNE 30, 1996, 1995 AND 1994
(UNAUDITED)
<TABLE>
<CAPTION>
MFSGRSTK MFSINVTR MFSBDFD MFSEMGRO MFSGROPP MFSHIINC
-------- -------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
1996
Beginning unit value - Jan. 1 $76.380777 77.505736 43.943375 30.247061 90.535764 50.886631
- -------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 .608023 1.557354 .000000 .000000 2.211694
- -------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 10.315288 7.552164 (2.794690) 4.246060 11.493969 (.175161)
- -------------------------------------------------------------------------------------------------------------------------
Contract charges (.530280) (.530618) (.276965) (.211750) (.629710) (.337761)
- -------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $86.165785 85.135305 42.429074 34.281371 101.400023 52.585403
- -------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 13% 10% (3)% 13% 12% 3%
=========================================================================================================================
1995
Beginning unit value - Jan. 1 $60.295273 56.351973 36.649839 21.706658 68.202665 44.007083
- -------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 .686914 1.470051 .000000 .000000 2.021820
- -------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) 10.119603 9.901063 3.491702 3.658108 13.562430 2.404312
- -------------------------------------------------------------------------------------------------------------------------
Contract charges (.412631) (.400851) (.253373) (.151697) (.480244) (.304214)
- -------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $70.002245 66.539099 41.358219 25.213069 81.284851 48.129001
- -------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 16% 18% 13% 16% 19% 9%
=========================================================================================================================
1994
Beginning unit value - Jan. 1 $65.494712 57.679687 38.865999 20.977490 72.093454 45.788518
- -------------------------------------------------------------------------------------------------------------------------
Reinvested capital gains
and dividends . .000000 .600603 1.194322 .000000 .000000 1.940884
- -------------------------------------------------------------------------------------------------------------------------
Unrealized gain (loss) (8.757424) (1.949990) (3.431015) (1.809190) (6.515890) (3.542839)
- -------------------------------------------------------------------------------------------------------------------------
Contract charges (.399966) (.374468) (.245017) (.136982) (.456727) (.292569)
- -------------------------------------------------------------------------------------------------------------------------
Ending unit value - June 30 $56.337322 55.955832 36.384289 19.031318 65.120837 43.893994
- -------------------------------------------------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* (14)% (3)% (6)% (9)% (10)% (4)%
=========================================================================================================================
<CAPTION>
MFSRSRCH MFSTOTRE MFSWDGVT
-------- -------- --------
<S> <C> <C> <C>
1996
Beginning unit value - Jan. 1 98.846334 72.697711 48.838310
- ---------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.531610 .000000
- ---------------------------------------------------------------------------------
Unrealized gain (loss) 13.672688 1.947028 (.446134)
- ---------------------------------------------------------------------------------
Contract charges (.687427) (.484016) (.310919)
- ---------------------------------------------------------------------------------
Ending unit value - June 30 111.831595 75.692333 48.081257
- ---------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 13% 4% (2)%
=================================================================================
1995
Beginning unit value - Jan. 1 72.258548 58.068470 42.845163
- ---------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.457625 .000000
- ---------------------------------------------------------------------------------
Unrealized gain (loss) 12.508389 6.632404 5.169023
- ---------------------------------------------------------------------------------
Contract charges (.505783) (.407358) (.297204)
- ---------------------------------------------------------------------------------
Ending unit value - June 30 84.261154 65.751141 47.716982
- ---------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* 17% 13% 11%
=================================================================================
1994
Beginning unit value - Jan. 1 73.200301 60.428053 46.460353
- ---------------------------------------------------------------------------------
Reinvested capital gains
and dividends .000000 1.242742 .580334
- ---------------------------------------------------------------------------------
Unrealized gain (loss) (3.009804) (3.089929) (4.511175)
- ---------------------------------------------------------------------------------
Contract charges (.475948) (.380503) (.283058)
- ---------------------------------------------------------------------------------
Ending unit value - June 30 69.714549 58.200363 42.246454
- ---------------------------------------------------------------------------------
Percentage increase (decrease)
in unit value* (5)% (4)% (9)%
=================================================================================
<FN>
* This is not an annualized rate of return as it is the change for a six month
period and contract charges do not include the annual contract maintenance
charge discussed in note 2.
See note 3.
</TABLE>
14
<PAGE> 14
[THIS PAGE LEFT BLANK INTENTIONALLY]
15
<PAGE> 15
Bulk Rate
U.S. Postage
PAID
Columbus, Ohio
Permit No. 521
NATIONWIDE LIFE INSURANCE COMPANY
HOME OFFICE: ONE NATIONWIDE PLAZA - COLUMBUS, OHIO 43215-2220
Nationwide(R) is a registered federal service mark of Nationwide Mutual
Insurance Company
