<PAGE> 1
[NATIONWIDE(R) LOGO]
NATIONWIDE(R)
VARIABLE
ACCOUNT
SEMI-ANNUAL REPORT
TO
CONTRACT OWNERS
JUNE 30, 1997
NATIONWIDE LIFE INSURANCE COMPANY
HOME OFFICE: COLUMBUS, OHIO
<PAGE> 2
[NATIONWIDE(R) LOGO]
NATIONWIDE LIFE INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43215-2220
[PICTURE]
PRESIDENT'S MESSAGE
We are pleased to present the 1997 semi-annual report of the Nationwide Variable
Account.
Our Enterprise Vision statement states: "We exist to serve our customers."
Everything we do is focused on you, our customer, and on your needs.
We recognize that your expectations have changed and your standards for value
and service are higher than ever before. You are being asked to take more
responsibility for your own financial future, as employers and government
programs provide fewer guarantees.
We know that you expect service and products customized to fit your needs -
including financial advice - and you expect to receive service at any time,
anywhere and any way you choose.
We are responding to your changing needs and expectations with innovative
product offerings, continuing investment in the training and professional
development of our people, and our investment in technology to enable us to
serve you faster, better and more cost effectively.
Equity investments produced solid gains for the first half of 1997 with the Dow
Jones Industrial Average breaking the 8,000 mark on July 16. The U.S. economy,
in its seventh year of expansion, is growing vigorously and corporate profits
are better than anticipated.
Interest rates and inflation are still at very low levels. However, the risk of
a temporary spike remains as the Federal Reserve might be forced to raise
interest rates in order to keep our economy on an inflation-free growth path.
Even such policy actions are not expected to end the prosperous times which we
now enjoy. In the long run, equity valuations will reflect these excellent
economic conditions.
Thank you for giving Nationwide Life Insurance Company the opportunity to meet
your investment needs.
/s/ Joseph J. Gasper
Joseph J. Gasper, President
2
<PAGE> 3
NATIONWIDE VARIABLE ACCOUNT
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS' EQUITY
June 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments at market value:
American Century: Benham Short-Term Government Fund (ACBenSTGvt)
325,544 shares (cost $3,086,052)................................................................ $ 3,069,880
American Century: Income & Growth Fund (ACIncGro)
30,926 shares (cost $658,749)................................................................... 728,002
American Century: Twentieth Century Growth Fund (ACTCGro)
395,562 shares (cost $8,105,866)................................................................ 10,181,775
American Century: Twentieth Century International Growth Fund (ACTCIntlGr)
60,415 shares (cost $502,039)................................................................... 576,360
American Century: Twentieth Century Ultra Fund (ACTCUltra)
286,757 shares (cost $7,862,513)................................................................ 9,376,964
Delaware Group Delchester High-Yield Bond Fund, Inc. -
Delchester Fund Institutional Class (DeHYBd)
198,237 shares (cost $1,241,758)................................................................ 1,280,614
Dreyfus A Bonds Plus, Inc. (DryABds)
125,239 shares (cost $1,791,408)................................................................ 1,802,189
Dreyfus S&P 500 Index Fund (Dry500Ix)
191,281 shares (cost $4,476,183)................................................................ 5,111,040
The Dreyfus Third Century Fund, Inc. (Dry3dCen)
52,758 shares (cost $488,316)................................................................... 546,577
Evergreen Income and Growth Fund - Class Y (EvIncGro)
41,670 shares (cost $814,274)................................................................... 959,668
Federated Investment Series Funds, Inc. - Federated Bond Fund - Class F (FedBdFd)
29,794 shares (cost $289,491)................................................................... 290,487
Fidelity Advisor Balanced Fund - Class T (FABal)
5,232 shares (cost $89,353)..................................................................... 96,368
Fidelity Advisor Equity-Income Fund - Class T (FAEqInc)
38,051 shares (cost $819,273)................................................................... 960,030
Fidelity Advisor Growth Opportunities Fund - Class T (FAGrOpp)
96,799 shares (cost $3,519,296)................................................................. 3,931,956
Fidelity Advisor High Yield Fund - Class T (FAHiYld)
126,676 shares (cost $1,544,123)................................................................ 1,574,584
Fidelity Asset Manager(TM) (FidAsMgr)
178,462 shares (cost $2,815,248)................................................................ 3,217,672
Fidelity Capital & Income Fund (FidCapInc)
129,122 shares (cost $1,172,846)................................................................ 1,229,240
Fidelity Equity-Income Fund (FidEqInc)
323,914 shares (cost $11,542,296)............................................................... 15,933,309
Fidelity Magellan(R) Fund (FidMgln)
142,931 shares (cost $11,745,373)............................................................... 13,013,832
Fidelity Puritan(R) Fund (FidPurtn)
527,425 shares (cost $8,913,372)................................................................ 10,189,843
</TABLE>
3
<PAGE> 4
<TABLE>
<S> <C>
Fidelity VIP - High Income Portfolio (FidVIPHI)
21,107 shares (cost $236,870)................................................................... 262,359
Janus Fund (JanFund)
104,994 shares (cost $2,703,635)................................................................ 2,899,932
Janus Twenty Fund (Jan20Fd)
148,200 shares (cost $4,416,506)................................................................ 4,871,343
Janus Worldwide Fund (JanWrldwde)
59,349 shares (cost $2,117,247)................................................................. 2,378,695
MFS(R) World Governments Fund - Class A (MFSWdGvt)
73,901 shares (cost $833,080)................................................................... 815,132
Nationwide(R) Bond Fund (NWBdFd)
165,629 shares (cost $1,546,166)................................................................ 1,525,447
Nationwide(R) Fund (NWFund)
134,533 shares (cost $2,381,072)................................................................ 3,331,037
Nationwide(R) Growth Fund (NWGroFd)
264,825 shares (cost $3,115,840)................................................................ 4,155,107
Nationwide(R) Money Market Fund (NWMyMkt)
8,399,906 shares (cost $8,399,906).............................................................. 8,399,906
Nationwide(R) U.S. Government Income Fund (NWUSGvt)
4,527 shares (cost $45,012)..................................................................... 45,319
Neuberger & Berman Guardian Fund (NBGuard)
241,508 shares (cost $5,982,050)................................................................ 6,984,402
Neuberger & Berman Limited Maturity Bond Fund (NBLtdMat)
80,176 shares (cost $798,088)................................................................... 798,556
Neuberger & Berman Partners Fund (NBPartFd)
200,754 shares (cost $5,017,687)................................................................ 5,870,038
Oppenheimer Global Fund - Class A (OppGlob)
111,143 shares (cost $4,149,888)................................................................ 5,056,991
Phoenix Balanced Fund Series - Class A (PhxBalFd)
31,992 shares (cost $529,056)................................................................... 553,776
Strong Total Return Fund, Inc. (StTotRet)
48,337 shares (cost $1,400,958)................................................................. 1,474,761
Templeton Foreign Fund - Class I (TemForFd)
411,792 shares (cost $4,114,789)................................................................ 4,743,845
Warburg Pincus Emerging Growth Fund - Common Shares (WPEmGro)
102,696 shares (cost $3,337,581)................................................................ 3,699,094
-------------
Total investments............................................................................ 141,936,130
Accounts receivable................................................................................... 74,820
-------------
Total assets................................................................................. 142,010,950
ACCOUNTS PAYABLE......................................................................................... 148
-------------
CONTRACT OWNERS' EQUITY (NOTE 3)......................................................................... $ 142,010,802
=============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 5
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
<TABLE>
<CAPTION>
TOTAL ACBenSTGvt ACIncGro
---------------------------- ------------------------ --------------------
1997 1996 1997 1996 1997 1996
------------- ----------- ---------- ---------- -------- ------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ...................... $ 1,181,299 1,014,822 91,925 117,233 3,655 --
Mortality, expense and administration
charges (note 2) ........................ (826,587) (555,812) (21,758) (28,776) (2,870) --
------------- ----------- ---------- ---------- -------- ---
Net investment activity ................. 354,712 459,010 70,167 88,457 785 --
------------- ----------- ---------- ---------- -------- ---
Proceeds from mutual fund shares sold ..... 26,655,100 14,617,261 693,417 509,287 146,680 --
Cost of mutual fund shares sold ........... (24,092,908) (13,597,151) (687,086) (517,177) (137,531) --
------------- ----------- ---------- ---------- -------- ---
Realized gain (loss) on investments ..... 2,562,192 1,020,110 6,331 (7,890) 9,149 --
Change in unrealized gain (loss) on
investments ............................. 12,623,122 856,306 (14,721) (72,229) 78,624 --
------------- ----------- ---------- ---------- -------- ---
Net gain (loss) on investments .......... 15,185,314 1,876,416 (8,390) (80,119) 87,773 --
------------- ----------- ---------- ---------- -------- ---
Reinvested capital gains .................. 374,659 1,691,249 -- -- -- --
------------- ----------- ---------- ---------- -------- ---
Net increase (decrease) in contract
owners' equity resulting from
operations ......................... 15,914,685 4,026,675 61,777 8,338 88,558 --
------------- ----------- ---------- ---------- -------- ---
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds . 18,534,519 18,154,988 36,005 212,450 448,748 --
Redemptions ............................... (7,012,541) (4,925,767) (337,412) (258,868) (406) --
Annuity benefits .......................... (11,540) (10,994) (467) (468) -- --
Annual contract maintenance charge (note 2) (62,190) (51,263) (1,282) (1,657) (42) --
Contingent deferred sales charges (note 2) (149,519) (38,145) (14,178) (638) -- --
Adjustments to maintain reserves .......... 8,971 (1,335) (65) (33) (63) --
------------- ----------- ---------- ---------- -------- ---
Net equity transactions ............... 11,307,700 13,127,484 (317,399) (49,214) 448,237 --
------------- ----------- ---------- ---------- -------- ---
Net change in contract owners' equity ....... 27,222,385 17,154,159 (255,622) (40,876) 536,795 --
Contract owners' equity beginning of period . 114,788,417 77,226,376 3,326,874 4,438,464 191,329 --
------------- ----------- ---------- ---------- -------- ---
Contract owners' equity end of period ....... $ 142,010,802 94,380,535 3,071,252 4,397,588 728,124 --
============= =========== ========== ========== ======== =====
ACTCGro
--------------------------
1997 1996
----------- -----------
<S> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ...................... -- --
Mortality, expense and administration
charges (note 2) ........................ (64,242) (66,090)
----------- -----------
Net investment activity ................. (64,242) (66,090)
----------- -----------
Proceeds from mutual fund shares sold ..... 1,805,710 1,886,264
Cost of mutual fund shares sold ........... (1,740,608) (2,096,221)
----------- -----------
Realized gain (loss) on investments ..... 65,102 (209,957)
Change in unrealized gain (loss) on
investments ............................. 1,514,468 916,970
----------- -----------
Net gain (loss) on investments .......... 1,579,570 707,013
----------- -----------
Reinvested capital gains .................. -- --
----------- -----------
Net increase (decrease) in contract
owners' equity resulting from
operations ......................... 1,515,328 640,923
----------- -----------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds . (104) (290,213)
Redemptions ............................... (991,041) (1,209,021)
Annuity benefits .......................... (5,584) (5,405)
Annual contract maintenance charge (note 2) (12,733) (13,858)
Contingent deferred sales charges (note 2) (13,749) (3,240)
Adjustments to maintain reserves .......... 10,290 (4,455)
----------- -----------
Net equity transactions ............... (1,012,921) (1,526,192)
----------- -----------
Net change in contract owners' equity ....... 502,407 (885,269)
Contract owners' equity beginning of period . 9,690,046 10,571,646
----------- -----------
Contract owners' equity end of period ....... 10,192,453 9,686,377
=========== ===========
</TABLE>
<PAGE> 6
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
<TABLE>
<CAPTION>
ACTCIntlGr ACTCUltra DeHYBd
--------------------- ------------------------ ----------------------
1997 1996 1997 1996 1997 1996
--------- -------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .......................... $ -- -- -- -- 56,298 42,025
Mortality, expense and administration
charges (note 2) ............................ (3,270) (2,701) (52,857) (28,516) (7,835) (5,421)
--------- -------- ---------- ---------- ---------- --------
Net investment activity ..................... (3,270) (2,701) (52,857) (28,516) 48,463 36,604
--------- -------- ---------- ---------- ---------- --------
Proceeds from mutual fund shares sold ......... 138,636 370,371 1,034,165 244,994 113,265 175,064
Cost of mutual fund shares sold ............... (128,229) (350,622) (688,761) (190,379) (112,153) (199,832)
--------- -------- ---------- ---------- ---------- --------
Realized gain (loss) on investments ......... 10,407 19,749 345,404 54,615 1,112 (24,768)
Change in unrealized gain (loss) on investments 83,319 2,625 981,999 318,881 21,697 12,026
Net gain (loss) on investments .............. 93,726 22,374 1,327,403 373,496 22,809 (12,742)
--------- -------- ---------- ---------- ---------- --------
Reinvested capital gains ...................... -- -- -- -- -- --
--------- -------- ---------- ---------- ---------- --------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 90,456 19,673 1,274,546 344,980 71,272 23,862
--------- -------- ---------- ---------- ---------- --------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... (13,361) 125,226 1,099,186 2,175,394 344,409 (13,407)
Redemptions ................................... (596) (403) (313,857) (137,267) (90,798) (3,979)
Annuity benefits .............................. -- -- -- -- -- --
Annual contract maintenance charge (note 2) ... (115) (30) (3,446) (1,597) (219) (134)
Contingent deferred sales charges (note 2) .... (15) -- (9,285) (6,454) (2,252) (117)
Adjustments to maintain reserves .............. (2) (147) 51 1,288 80 (39)
--------- -------- ---------- ---------- ---------- --------
Net equity transactions ................... (14,089) 124,646 772,649 2,031,364 251,220 (17,676)
--------- -------- ---------- ---------- ---------- --------
Net change in contract owners' equity ........... 76,367 144,319 2,047,195 2,376,344 322,492 6,186
Contract owners' equity beginning of period ..... 499,996 299,327 7,329,827 3,275,899 958,214 799,336
--------- -------- ---------- ---------- ---------- --------
Contract owners' equity end of period ........... $ 576,363 443,646 9,377,022 5,652,243 1,280,706 805,522
========= ======== ========== ========== ========== ========
DRyABds
------------------------
1997 1996
---------- ----------
<S> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .......................... 45,006 19,010
Mortality, expense and administration
charges (note 2) ............................ (11,416) (4,891)
---------- ----------
Net investment activity ..................... 33,590 14,119
---------- ----------
Proceeds from mutual fund shares sold ......... 520,491 140,436
Cost of mutual fund shares sold ............... (533,026) (130,627)
---------- ----------
Realized gain (loss) on investments ......... (12,535) 9,809
Change in unrealized gain (loss) on investments 9,729 (40,725)
Net gain (loss) on investments .............. (2,806) (30,916)
---------- ----------
Reinvested capital gains ...................... -- --
---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 30,784 (16,797)
---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... (6,458) 697,681
Redemptions ................................... (74,949) (70,892)
Annuity benefits .............................. -- --
Annual contract maintenance charge (note 2) ... (480) (251)
Contingent deferred sales charges (note 2) .... (1,364) (483)
Adjustments to maintain reserves .............. 2 --
---------- ----------
Net equity transactions ................... (83,249) 626,055
---------- ----------
Net change in contract owners' equity ........... (52,465) 609,258
Contract owners' equity beginning of period ..... 1,854,653 573,471
---------- ----------
Contract owners' equity end of period ........... 1,802,188 1,182,729
========== ==========
</TABLE>
<PAGE> 7
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Dry500Ix Dry3dCen EvIncGro
------------------------- -------------------- --------------------
1997 1996 1997 1996 1997 1996
----------- ---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .......................... $ -- -- -- -- 22,364 21,125
Mortality, expense and administration
charges (note 2) ............................ (25,708) (5,018) (3,168) (1,170) (5,924) (5,141)
Net investment activity ..................... (25,708) (5,018) (3,168) (1,170) 16,440 15,984
----------- ---------- -------- -------- -------- --------
Proceeds from mutual fund shares sold ......... 1,554,236 44,207 332,261 29,468 101,520 31,665
Cost of mutual fund shares sold ............... (1,330,477) (33,884) (306,366) (25,583) (98,118) (31,990)
----------- ---------- -------- -------- -------- --------
Realized gain (loss) on investments ......... 223,759 10,323 25,895 3,885 3,402 (325)
Change in unrealized gain (loss) on investments 528,461 56,665 63,307 12,800 67,374 22,541
----------- ---------- -------- -------- -------- --------
Net gain (loss) on investments .............. 752,220 66,988 89,202 16,685 70,776 22,216
----------- ---------- -------- -------- -------- --------
Reinvested capital gains ...................... -- -- -- -- -- --
----------- ---------- -------- -------- -------- --------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 726,512 61,970 86,034 15,515 87,216 38,200
----------- ---------- -------- -------- -------- --------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... 1,214,350 996,322 149,306 36,368 (2,595) 10,389
Redemptions ................................... (108,026) (7,181) (21,806) (2,281) (40,973) (3,212)
Annuity benefits .............................. -- -- -- -- -- --
Annual contract maintenance charge (note 2) ... (869) (154) (215) (145) (187) (182)
Contingent deferred sales charges (note 2) .... (1,955) (266) (385) (135) (942) (5)
Adjustments to maintain reserves .............. (5) 13 (5) 8 1 81
----------- ---------- -------- -------- -------- --------
Net equity transactions ................... 1,103,495 988,734 126,895 33,815 (44,696) 7,071
----------- ---------- -------- -------- -------- --------
Net change in contract owners' equity ........... 1,830,007 1,050,704 212,929 49,330 42,520 45,271
Contract owners' equity beginning of period ..... 3,281,066 483,367 333,645 157,701 917,152 765,636
----------- ---------- -------- -------- -------- --------
Contract owners' equity end of period ........... $ 5,111,073 1,534,071 546,574 207,031 959,672 810,907
=========== ========== ======== ======== ======== ========
<CAPTION>
FedBdFd
---------------------
1997 1996
-------- ------
<S> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .......................... 9,498 --
Mortality, expense and administration
charges (note 2) ............................ (1,627) --
Net investment activity ..................... 7,871 --
-------- ------
Proceeds from mutual fund shares sold ......... 17,330 --
Cost of mutual fund shares sold ............... (17,533) --
-------- ------
Realized gain (loss) on investments ......... (203) --
Change in unrealized gain (loss) on investments 1,889 --
-------- ------
Net gain (loss) on investments .............. 1,686 --
Reinvested capital gains ...................... -- --
-------- ------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 9,557 --
-------- ------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... 186,439 --
Redemptions ................................... (3,667) --
Annuity benefits .............................. -- --
Annual contract maintenance charge (note 2) ... (5) --
Contingent deferred sales charges (note 2) .... -- --
Adjustments to maintain reserves .............. (13) --
-------- ------
Net equity transactions ................... 182,754 --
-------- ------
Net change in contract owners' equity ........... 192,311 --
Contract owners' equity beginning of period ..... 99,894 --
-------- ------
Contract owners' equity end of period ........... 292,205 --
======== ======
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION>
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
FABal FAEqInc
------------------------------ ------------------------------
1997 1996 1997 1996
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ 1,021 104 4,735 782
Mortality, expense and administration
charges (note 2)..................... (426) (63) (5,330) (462)
-------------- -------------- -------------- --------------
Net investment activity.............. 595 41 (595) 320
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 15,243 14,622 75,743 27,598
Cost of mutual fund shares sold........ (14,365) (15,104) (64,906) (26,938)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 878 (482) 10,837 660
Change in unrealized gain (loss) on investments 6,758 - 114,103 (925)
-------------- -------------- -------------- --------------
Net gain (loss) on investments....... 7,636 (482) 124,940 (265)
-------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 8,231 (441) 124,345 55
-------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 64,677 441 166,620 208,312
Redemptions............................ (5,952) - (13,671) (429)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (53) - (164) (3)
Contingent deferred sales charges (note 2) (348) - (589) -
Adjustments to maintain reserves....... (25) - (7) (2)
-------------- -------------- -------------- --------------
Net equity transactions............ 58,299 441 152,189 207,878
-------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 66,530 - 276,534 207,933
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 29,841 - 683,495 -
-------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 96,371 - 960,029 207,933
============== ============== ============== ==============
<CAPTION>
FAGrOpp FAHiYld
------------------------------ ------------------------------
1997 1996 1997 1996
------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ - - 42,970 13,534
Mortality, expense and administration
charges (note 2)..................... (18,867) (1,860) (7,596) (2,236)
------------- -------------- -------------- --------------
Net investment activity.............. (18,867) (1,860) 35,374 11,298
------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 529,346 21,694 61,592 312,740
Cost of mutual fund shares sold........ (460,076) (21,358) (60,780) (313,496)
------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 69,270 336 812 (756)
Change in unrealized gain (loss) on investments 364,207 21,532 24,133 (1,501)
------------- -------------- -------------- --------------
Net gain (loss) on investments....... 433,477 21,868 24,945 (2,257)
------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 414,610 20,008 60,319 9,041
------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 1,489,475 839,071 745,207 461,067
Redemptions............................ (95,097) - (27,763) (6,041)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (576) (19) (121) (20)
Contingent deferred sales charges (note 2) (3,001) - (474) (302)
Adjustments to maintain reserves....... 26 2 9 (7)
------------- -------------- -------------- --------------
Net equity transactions............ 1,390,827 839,054 716,858 454,697
------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 1,805,437 859,062 777,177 463,738
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 2,126,543 - 797,492 -
------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 3,931,980 859,062 1,574,669 463,738
============= ============== ============== ==============
</TABLE>
<PAGE> 9
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
<TABLE>
<CAPTION>
FidAsMgr FidCapInc
--------------------------- --------------------------
1997 1996 1997 1996
----------- ---------- ---------- ----------
INVESTMENT ACTIVITY:
<S> <C> <C> <C> <C>
Reinvested dividends .......................... $ 50,181 37,151 49,215 73,071
Mortality, expense and administration
charges (note 2) ............................ (20,098) (15,940) (7,149) (8,797)
----------- ---------- ---------- ----------
Net investment activity ..................... 30,083 21,211 42,066 64,274
----------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ......... 614,319 236,192 79,058 274,880
Cost of mutual fund shares sold ............... (519,825) (221,440) (67,951) (203,400)
----------- ---------- ---------- ----------
Realized gain (loss) on investments ......... 94,494 14,752 11,107 71,480
Change in unrealized gain (loss) on investments 188,211 47,315 9,667 (83,275)
----------- ---------- ---------- ----------
Net gain (loss) on investments .............. 282,705 62,067 20,774 (11,795)
----------- ---------- ---------- ----------
Reinvested capital gains ...................... -- -- -- --
----------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 312,788 83,278 62,840 52,479
----------- ---------- ---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... 80,323 314,017 (19) (16,019)
Redemptions ................................... (212,727) (19,952) (69,355) (238,756)
Annuity benefits .............................. -- -- (531) (506)
Annual contract maintenance charge (note 2) ... (1,057) (794) (1,792) (2,245)
Contingent deferred sales charges (note 2) .... (5,873) (636) (280) (528)
Adjustments to maintain reserves .............. 17 (84) (883) (60)
----------- ---------- ---------- ----------
Net equity transactions ................... (139,317) 292,551 (72,860) (258,114)
----------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ........... 173,471 375,829 (10,020) (205,635)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ..... 3,044,222 2,220,460 1,238,341 1,421,302
----------- ---------- ---------- ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ........... $ 3,217,693 2,596,289 1,228,321 1,215,667
=========== ========== ========== ==========
<CAPTION>
FidEqInc FidMgln
--------------------------- ---------------------------
1997 1996 1997 1996
----------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .......................... 169,340 161,239 108,309 59,156
Mortality, expense and administration
charges (note 2) ............................ (96,415) (83,823) (78,838) (64,509)
----------- ---------- ---------- ----------
Net investment activity ..................... 72,925 77,416 29,471 (5,353)
----------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ......... 1,526,472 1,438,215 1,651,101 1,954,931
Cost of mutual fund shares sold ............... (1,018,509) (891,004) (1,363,490) (1,631,108)
----------- ---------- ---------- ----------
Realized gain (loss) on investments ......... 507,963 547,211 287,611 323,823
Change in unrealized gain (loss) on investments 1,554,107 221,542 1,232,780 (1,645,529)
----------- ---------- ---------- ----------
Net gain (loss) on investments .............. 2,062,070 768,753 1,520,391 (1,321,706)
----------- ---------- ---------- ----------
Reinvested capital gains ...................... 161,586 163,388 210,841 1,520,319
----------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 2,296,581 1,009,557 1,760,703 193,260
----------- ---------- ---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ..... 543,699 1,173,679 65,340 1,201,935
Redemptions ................................... (1,144,153) (1,060,619) (482,354) (140,477)
Annuity benefits .............................. (1,584) (1,380) -- --
Annual contract maintenance charge (note 2) ... (12,538) (12,469) (6,133) (3,646)
Contingent deferred sales charges (note 2) .... (12,777) (3,654) (17,472) (5,805)
Adjustments to maintain reserves .............. 48 145 52 150
----------- ---------- ---------- ----------
Net equity transactions ................... (627,305) 95,702 (440,567) 1,052,157
----------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ........... 1,669,276 1,105,259 1,320,136 1,245,417
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ..... 14,264,106 12,222,053 11,693,770 9,110,875
----------- ---------- ---------- ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ........... 15,933,382 13,327,312 13,013,906 10,356,292
=========== ========== ========== ==========
</TABLE>
9
<PAGE> 10
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
<TABLE>
<CAPTION>
FidPurtn FidVIPHI
---------------------------- --------------------------
1997 1996 1997 1996
------------ ------------ ------------ ----------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ........................................ $ 158,246 89,608 18,061 33,607
Mortality, expense and administration
charges (note 2) .......................................... (57,211) (34,423) (1,529) (2,453)
------------ ------------ ------------ ----------
Net investment activity ................................... 101,035 55,185 16,532 31,154
------------ ------------ ------------ ----------
Proceeds from mutual fund shares sold ....................... 609,642 235,870 27,147 144,855
Cost of mutual fund shares sold ............................. (531,404) (214,299) (25,560) (146,997)
------------ ------------ ------------ ----------
Realized gain (loss) on investments ....................... 78,238 21,571 1,587 (2,142)
Change in unrealized gain (loss) on investments ............. 947,544 166,695 (2,226) (11,439)
------------ ------------ ------------ ----------
Net gain (loss) on investments ............................ 1,025,782 188,266 (639) (13,581)
------------ ------------ ------------ ----------
Reinvested capital gains .................................... -- -- 2,232 6,575
------------ ------------ ------------ ----------
Net increase (decrease) in contract owners'
equity resulting from operations ...................... 1,126,817 243,451 18,125 24,148
------------ ------------ ------------ ----------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ................... 1,472,626 1,458,398 (4,194) (129,318)
Redemptions ................................................. (190,582) (90,430) (21,184) (12,887)
Annuity benefits ............................................ -- -- -- --
Annual contract maintenance charge (note 2) ................. (2,683) (1,525) (124) (178)
Contingent deferred sales charges (note 2) .................. (5,951) (3,592) (95) (24)
Adjustments to maintain reserves ............................ 34 89 (185) 13
------------ ------------ ------------ ----------
Net equity transactions ................................. 1,273,444 1,362,940 (25,782) (142,394)
------------ ------------ ------------ ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ......................... 2,400,261 1,606,391 (7,657) (118,246)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ................... 7,789,643 4,344,394 269,844 444,801
------------ ------------ ------------ ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ......................... $ 10,189,904 5,950,785 262,187 326,555
============ ============ ============ ==========
<CAPTION>
JanFund Jan20Fd
----------------------- -------------------------
1997 1996 1997 1996
--------- ------- --------- ---------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ........................................ -- -- -- --
Mortality, expense and administration
charges (note 2) .......................................... (15,077) (2,201) (27,452) (10,075)
--------- ------- --------- ---------
Net investment activity ................................... (15,077) (2,201) (27,452) (10,075)
--------- ------- --------- ---------
Proceeds from mutual fund shares sold ....................... 336,177 20,021 1,581,620 90,463
Cost of mutual fund shares sold ............................. (314,835) (18,025) (1,445,719) (79,749)
--------- ------- --------- ---------
Realized gain (loss) on investments ....................... 21,342 1,996 135,901 10,714
Change in unrealized gain (loss) on investments ............. 266,838 24,665 631,562 179,351
--------- ------- --------- ---------
Net gain (loss) on investments ............................ 288,180 26,661 767,463 190,065
--------- ------- --------- ---------
Reinvested capital gains .................................... -- -- -- --
--------- ------- --------- ---------
Net increase (decrease) in contract owners'
equity resulting from operations ...................... 273,103 24,460 740,011 179,990
--------- ------- --------- ---------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds ................... 1,083,334 738,220 980,704 878,124
Redemptions ................................................. (64,103) (514) (243,098) (29,864)
Annuity benefits ............................................ -- -- -- --
Annual contract maintenance charge (note 2) ................. (362) (15) (1,129) (561)
Contingent deferred sales charges (note 2) .................. (1,142) -- (4,758) (975)
Adjustments to maintain reserves ............................ (4) 7 33 1,656
--------- ------- --------- ---------
Net equity transactions ................................. 1,017,723 737,698 731,752 848,380
--------- ------- --------- ---------
NET CHANGE IN CONTRACT OWNERS' EQUITY ......................... 1,290,826 762,158 1,471,763 1,028,370
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ................... 1,609,117 -- 3,399,603 1,130,058
--------- ------- --------- ---------
CONTRACT OWNERS' EQUITY END OF PERIOD ......................... 2,899,943 762,158 4,871,366 2,158,428
========= ======= ========= =========
</TABLE>
10
<PAGE> 11
<TABLE>
<CAPTION>
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
JANWRLDWDE MFSWDGVT
------------------------------ ------------------------------
1997 1996 1997 1996
-------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ - - - -
Mortality, expense and administration
charges (note 2)..................... (9,942) - (6,285) (7,389)
-------------- -------------- -------------- --------------
Net investment activity.............. (9,942) - (6,285) (7,389)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 309,800 - 339,743 210,742
Cost of mutual fund shares sold........ (297,970) - (366,667) (228,307)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 11,830 - (26,924) (17,565)
Change in unrealized gain (loss) on
investments.......................... 284,944 - (319) 5,379
-------------- -------------- -------------- --------------
Net gain (loss) on investments....... 296,774 - (27,243) (12,186)
-------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
-------------- -------------- -------------- --------------
Net increase (decrease) in contract
owners' equity resulting from
operations....................... 286,832 - (33,528) (19,575)
-------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 1,639,228 - (113,043) (87,721)
Redemptions............................ (12,516) - (74,976) (54,175)
Annuity benefits....................... - - (1,301) (1,315)
Annual contract maintenance charge (note 2) (148) - (873) (1,342)
Contingent deferred sales charges (note 2) (5) - (1,161) (315)
Adjustments to maintain reserves....... 5 - (1) (10)
-------------- -------------- -------------- --------------
Net equity transactions............ 1,626,564 - (191,355) (144,878)
-------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 1,913,396 - (224,883) (164,453)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 465,306 - 1,044,394 1,219,461
-------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 2,378,702 - 819,511 1,055,008
============== ============== ============== ==============
<CAPTION>
NWBDFD NWFUND
------------------------------ ------------------------------
1997 1996 1997 1996
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. 50,589 47,527 20,071 17,596
Mortality, expense and administration
charges (note 2)..................... (10,063) (9,379) (18,174) (12,762)
------------- -------------- -------------- --------------
Net investment activity.............. 40,526 38,148 1,897 4,834
------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 250,075 203,805 254,019 50,871
Cost of mutual fund shares sold........ (273,436) (207,123) (158,378) (31,998)
------------- -------------- -------------- --------------
Realized gain (loss) on investments.. (23,361) (3,318) 95,641 18,873
Change in unrealized gain (loss) on
investments.......................... 7,935 (98,422) 490,047 147,465
------------- -------------- -------------- --------------
Net gain (loss) on investments....... (15,426) (101,740) 585,688 166,338
------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
------------- -------------- -------------- --------------
Net increase (decrease) in contract
owners' equity resulting from
operations....................... 25,100 (63,592) 587,585 171,172
------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds (93,456) 209,302 293,395 139,649
Redemptions............................ (21,775) (13,267) (41,895) 13,625
Annuity benefits....................... (100) (101) (586) (491)
Annual contract maintenance charge (note 2) (521) (399) (948) (747)
Contingent deferred sales charges (note 2) (625) (208) (183) (4)
Adjustments to maintain reserves....... (13) (71) (844) (30)
------------- -------------- -------------- --------------
Net equity transactions............ (116,490) 195,256 248,939 152,002
------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... (91,390) 131,664 836,524 323,174
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 1,616,821 1,493,256 2,488,828 1,788,791
------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... 1,525,431 1,624,920 3,325,352 2,111,965
============== ============== ============== ==============
</TABLE>
<PAGE> 12
<TABLE>
<CAPTION>
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
NWGROFD NWMYMKT
------------------------------ ------------------------------
1997 1996 1997 1996
-------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ 18,800 19,412 206,059 209,032
Mortality, expense and administration
charges (note 2)..................... (25,136) (21,789) (54,634) (56,354)
-------------- -------------- -------------- --------------
Net investment activity.............. (6,336) (2,377) 151,425 152,678
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 508,855 382,729 7,885,564 4,782,020
Cost of mutual fund shares sold........ (306,509) (267,313) (7,885,564) (4,782,020)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 202,346 115,416 - -
Change in unrealized gain (loss) on investments 445,355 105,136 - -
-------------- -------------- -------------- --------------
Net gain (loss) on investments....... 647,701 220,552 - -
-------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 641,365 218,175 151,425 152,678
-------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 60,694 143,664 1,730,014 278,296
Redemptions............................ (225,679) (289,613) (1,070,376) (1,128,739)
Annuity benefits....................... (612) (554) (775) (774)
Annual contract maintenance charge (note 2) (1,492) (1,307) (4,846) (4,947)
Contingent deferred sales charges (note 2) (2,616) (1,771) (18,493) (4,027)
Adjustments to maintain reserves....... (46) (20) 216 (321)
-------------- -------------- -------------- --------------
Net equity transactions............ (169,751) (149,601) 635,740 (860,512)
-------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 471,614 68,574 787,165 (707,834)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 3,683,393 3,217,540 7,675,383 9,264,318
-------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 4,155,007 3,286,114 8,462,548 8,556,484
============== ============== ============== ==============
<CAPTION>
NWUSGVT NBGUARD
------------------------------ ------------------------------
1997 1996 1997 1996
------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. 1,086 42 16,044 12,782
Mortality, expense and administration
charges (note 2)..................... (238) (8) (39,603) (16,986)
------------- -------------- -------------- --------------
Net investment activity.............. 848 34 (23,559) (4,204)
------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 46,252 303 432,748 140,734
Cost of mutual fund shares sold........ (46,295) (313) (320,754) (111,236)
------------- -------------- -------------- --------------
Realized gain (loss) on investments.. (43) (10) 111,994 29,498
Change in unrealized gain (loss) on investments 260 22 627,893 44,241
------------- -------------- -------------- --------------
Net gain (loss) on investments....... 217 12 739,887 73,739
------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 1,065 46 716,328 69,535
------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds (16,974) 5,654 1,248,605 1,764,923
Redemptions............................ (4,312) - (199,249) (23,851)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (20) (6) (1,600) (412)
Contingent deferred sales charges (note 2) (206) - (5,979) (893)
Adjustments to maintain reserves....... (6) (3) 38 280
------------- -------------- -------------- --------------
Net equity transactions............ (21,518) 5,645 1,041,815 1,740,047
------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... (20,453) 5,691 1,758,143 1,809,582
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 65,790 - 5,226,230 1,747,951
------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... 45,337 5,691 6,984,373 3,557,533
============= ============== ============== ==============
</TABLE>
12
<PAGE> 13
<TABLE>
<CAPTION>
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
NBLtDMat NBPArtFd
------------------------------ ------------------------------
1997 1996 1997 1996
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ 26,152 31,856 - -
Mortality, expense and administration
charges (note 2)..................... (5,295) (6,874) (31,260) (11,189)
-------------- -------------- -------------- --------------
Net investment activity.............. 20,857 24,982 (31,260) (11,189)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 368,717 163,884 431,852 42,766
Cost of mutual fund shares sold........ (369,101) (164,369) (313,974) (37,376)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments.. (384) (485) 117,878 5,390
Change in unrealized gain (loss) on
investments.......................... (605) (25,701) 609,613 145,155
-------------- -------------- -------------- --------------
Net gain (loss) on investments....... (989) (26,186) 727,491 150,545
-------------- -------------- -------------- --------------
Reinvested capital gains............... - - - -
-------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 19,868 (1,204) 696,231 139,356
-------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 42,300 197,520 1,122,162 1,034,828
Redemptions............................ (82,046) (15,499) (91,442) (26,128)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (175) (144) (1,243) (697)
Contingent deferred sales charges (note 2) (2,247) (239) (2,099) (883)
Adjustments to maintain reserves....... 3 102 65 255
-------------- -------------- -------------- --------------
Net equity transactions............ (42,165) 181,740 1,027,443 1,007,375
-------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... (22,297) 180,536 1,723,674 1,146,731
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 820,873 987,369 4,146,403 1,097,022
-------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 798,576 1,167,905 5,870,077 2,243,753
============== ============== ============== ==============
<CAPTION>
OppGlob PhxBalFd
------------------------------ ------------------------------
1997 1996 1997 1996
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ - - 6,504 6,306
Mortality, expense and administration
charges (note 2)..................... (29,996) (18,894) (3,267) (2,659)
------------- -------------- -------------- --------------
Net investment activity.............. (29,996) (18,894) 3,237 3,647
------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 868,740 180,513 172,594 18,588
Cost of mutual fund shares sold........ (729,148) (183,147) (177,663) (16,732)
------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 139,592 (2,634) (5,069) 1,856
Change in unrealized gain (loss) on
investments.......................... 579,090 247,692 55,799 487
------------- -------------- -------------- --------------
Net gain (loss) on investments....... 718,682 245,058 50,730 2,343
------------- -------------- -------------- --------------
Reinvested capital gains............... - - - 303
------------- -------------- -------------- --------------
Net increase (decrease) in contract owners'
equity resulting from operations. 688,686 226,164 53,967 6,293
------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 535,585 593,888 (27,460) 226,885
Redemptions............................ (272,745) (72,506) (4,557) (1,388)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (2,015) (1,363) (151) (37)
Contingent deferred sales charges (note 2) (9,156) (2,276) (132) (38)
Adjustments to maintain reserves....... 65 37 2 (3)
------------- -------------- -------------- --------------
Net equity transactions............ 251,734 517,780 (32,298) 225,419
------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 940,420 743,944 21,669 231,712
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 4,116,590 2,499,750 532,110 270,523
------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $5,057,010 3,243,694 553,779 502,235
============= ============== ============== ==============
</TABLE>
<PAGE> 14
<TABLE>
<CAPTION>
NATIONWIDE VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS' EQUITY
SIX MONTH PERIODS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
StTotRet TemForFd
------------------------------ -----------------------------
1997 1996 1997 1996
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ 5,170 2,624 - -
Mortality, expense and administration
charges (note 2)..................... (8,743) (4,616) (26,580) (9,869)
-------------- -------------- -------------- --------------
Net investment activity.............. (3,573) (1,992) (26,580) (9,869)
-------------- -------------- -------------- --------------
Proceeds from mutual fund shares sold.. 216,379 44,466 324,966 39,906
Cost of mutual fund shares sold........ (197,877) (37,651) (291,346) (35,972)
-------------- -------------- -------------- --------------
Realized gain (loss) on investments.. 18,502 6,815 33,620 3,934
Change in unrealized gain (loss) on
investments......................... 134,426 24,635 417,356 115,889
-------------- -------------- -------------- --------------
Net gain (loss) on investments....... 152,928 31,450 450,976 119,823
-------------- -------------- -------------- --------------
Reinvested capital gains............... - 664 - -
-------------- -------------- -------------- --------------
Net increase (decrease) in contract
owners' equity resulting from
operations....................... 149,355 30,122 424,396 109,954
-------------- -------------- -------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 415,217 179,777 1,014,748 1,454,943
Redemptions............................ (155,445) (6,410) (134,025) (14,219)
Annuity benefits....................... - - - -
Annual contract maintenance charge (note 2) (278) (162) (967) (175)
Contingent deferred sales charges (note 2) (3,990) (233) (3,754) (404)
Adjustments to maintain reserves....... 157 10 (36) 26
-------------- -------------- -------------- --------------
Net equity transactions............ 255,661 172,982 875,966 1,440,171
-------------- -------------- -------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 405,016 203,104 1,300,362 1,550,125
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 1,069,749 614,955 3,443,497 766,650
-------------- -------------- -------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $ 1,474,765 818,059 4,743,859 2,316,775
============== ============== ============== ==============
<CAPTION>
WPEmGro
-----------------------------
1997 1996
------------- --------------
<S> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .................. $ - -
Mortality, expense and administration
charges (note 2)..................... (20,708) (2,478)
------------- --------------
Net investment activity.............. (20,708) (2,478)
------------- --------------
Proceeds from mutual fund shares sold.. 679,625 152,097
Cost of mutual fund shares sold........ (690,918) (134,361)
------------- --------------
Realized gain (loss) on investments.. (11,293) 17,736
Change in unrealized gain (loss) on
investments.......................... 297,498 (3,657)
------------- --------------
Net gain (loss) on investments....... 286,205 14,079
------------- --------------
Reinvested capital gains............... - -
------------- --------------
Net increase (decrease) in contract
owners' equity resulting from
operations....................... 265,497 11,601
------------- --------------
EQUITY TRANSACTIONS:
Purchase payments received from contract
owners - net of transfers between funds 539,787 935,243
Redemptions............................ (67,933) (524)
Annuity benefits....................... - -
Annual contract maintenance charge (note 2) (588) (42)
Contingent deferred sales charges (note 2) (1,988) -
Adjustments to maintain reserves....... (20) (212)
------------- --------------
Net equity transactions............ 469,258 934,465
------------- --------------
NET CHANGE IN CONTRACT OWNERS' EQUITY.... 734,755 946,066
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD 2,964,337 -
------------- --------------
CONTRACT OWNERS' EQUITY END OF PERIOD.... $3,699,092 946,066
============= ==============
</TABLE>
14
<PAGE> 15
================================================================================
NATIONWIDE VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
June 30, 1997 and 1996
(UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Organization and Nature of Operations
The Nationwide Variable Account (the Account) was established pursuant
to a 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 Individual Deferred Variable Annuity Contracts
through the Account. As of December 25, 1982, only tax qualified
contracts are issued. The primary distribution for the contract is
through the Company for Individual Retirement Account rollovers;
however, other distributors may be utiized.
(b) The Contracts
Only contracts without a front-end sales charge, but with a contingent
deferred sales charge and certain other fees, are offered for purchase.
See note 2 for a discussion of contract charges.
With certain exceptions, contract owners in either the accumulation or
the payout phase may invest in the following:
American Century: Benham Short-Term Government Fund (ACBenSTGvt)
(formerly Twentieth Century Investors, Inc. - U.S. Governments
Short-Term (TCUSGvt))
American Century: Income & Growth Fund (ACIncGro)
American Century: Twentieth Century Growth Fund (ACTCGro)
(formerly Twentieth Century Investors, Inc. - Growth Investors
(TCGroInv))
American Century: Twentieth Century International Growth Fund
(ACTCIntlGr) (formerly Twentieth Century World Investors, Inc.
- International Equity (TCIntlEq))
American Century: Twentieth Century Ultra Fund (ACTCUltra)
(formerly Twentieth Century Investors, Inc. - Ultra Investors
(TCUltra))
Delaware Group Delchester High-Yield Bond Fund, Inc. - Delchester
Fund Institutional Class (DeHYBd)
Dreyfus A Bonds Plus, Inc. (DryABds)
Dreyfus S&P 500 Index Fund (Dry500Ix)
The Dreyfus Third Century Fund, Inc. (Dry3dCen)
Evergreen Income and Growth Fund - Class Y (EvIncGro)
(formerly The Evergreen Total Return Fund - Class Y (EvTotRet))
Federated Investment Series Funds, Inc. - Federated Bond Fund -
Class F (FedBdFd)
Fidelity Advisor Balanced Fund - Class T (FABal)
(formerly Fidelity Advisor Income & Growth Fund - Class T
(FAIncGr)
Fidelity Advisor Equity-Income Fund - Class T (FAEqInc)
Fidelity Advisor Growth Opportunities Fund - Class T (FAGrOpp)
Fidelity Advisor High Yield Fund - Class T (FAHiYld)
Fidelity Asset Manager(TM) (FidAsMgr)
Fidelity Capital & Income Fund (FidCapInc)
(not available for additional purchase payments or exchanges
after May 1, 1991)
Fidelity Equity-Income Fund (FidEqInc)
15
<PAGE> 16
Fidelity Magellan(R) Fund (FidMgln)
Fidelity Puritan(R) Fund (FidPurtn)
Portfolio of the Fidelity Variable Insurance Products Fund
(Fidelity VIP);
Fidelity VIP - High Income Portfolio (FidVIPHI)
(not available for additional purchase payments or exchanges
after December 1, 1993)
Janus Fund (JanFund) Janus Twenty Fund (Jan20Fd)
Janus Worldwide Fund (JanWrldwde)
MFS(R) World Governments Fund - Class A (MFSWdGvt)
Nationwide(R) Bond Fund (NWBdFd) (managed for a fee by an
affiliated investment advisor)
Nationwide(R) Fund (NWFund) (managed for a fee by an affiliated
investment advisor)
Nationwide(R) Growth Fund (NWGroFd) (managed for a fee by an
affiliated investment advisor)
Nationwide(R) Money Market Fund (NWMyMkt) (managed for a fee by
an affiliated investment advisor)
Nationwide(R) U.S. Government Income Fund (NWUSGvt)
(managed for a fee by an affiliated investment advisor)
Neuberger & Berman Guardian Fund (NBGuard)
Neuberger & Berman Limited Maturity Bond Fund (NBLtdMat)
Neuberger & Berman Partners Fund (NBPartFd)
Oppenheimer Global Fund - Class A (OppGlob)
Phoenix Balanced Fund Series - Class A (PhxBalFd)
Strong Total Return Fund, Inc. (StTotRet)
Templeton Foreign Fund - Class I (TemForFd)
Warburg Pincus Emerging Growth Fund - Common Shares
(WPEmGro)
At June 30, 1997, 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, 1997. 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.
(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 Company does not provide for income taxes within the Account.
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.
(f) Reclassifications
Certain 1996 amounts have been reclassified to conform with the current
year presentation.
16
<PAGE> 17
(2) EXPENSES
The Company does not deduct a sales charge from purchase payments received
from the contract owners. However, if any part of the contract value of
such contracts is surrendered, the Company will, with certain exceptions,
deduct from a contract owner's contract value a contingent deferred sales
charge. For contracts issued prior to January 1, 1993, the contingent
deferred sales charge will be 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. For contracts issued on or after
January 1, 1993, the Company will deduct a contingent deferred sales charge
not to exceed 7% of the lesser of purchase payments or the amount
surrendered, such charge declining 1% per year, to 0%, after the purchase
payment has been held in the contract for 84 months. No sales charges are
deducted on redemptions used to purchase units in the fixed investment
options of the Company.
The following contract charges are deducted by the Company: (a) an annual
contract maintenance charge of $30, with certain exceptions, which is
satisfied by surrendering units; and (b) for contracts issued prior to
January 1, 1993, 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; for contracts issued on or after January 1, 1993, a
mortality risk charge, an expense risk charge and an administration charge
assessed through the daily unit value calculation equal to an annual rate
of 0.80%, 0.45% and 0.05%, respectively.
17
<PAGE> 18
<TABLE>
<CAPTION>
(3) COMPONENTS OF CONTRACT OWNERS'S EQUITY
The following is a summary of contract owners' equity at June 30, 1997, for
each series, in both the accumulation and payout phases.
Contract owners' equity represented by: UNITS UNIT VALUE
------- ----------
<S> <C> <C> <C>
Contracts in accumulation phase:
American Century: Benham Short-Term Government Fund:
Tax qualified .................................. 143,074 $ 21.411922 $ 3,063,489
American Century: Income & Growth Fund:
Tax qualified .................................. 58,967 12.347988 728,124
American Century: Twentieth Century Growth Fund:
Tax qualified .................................. 167,576 60.064246 10,065,326
American Century: Twentieth Century International
Growth Fund:
Tax qualified .................................. 36,480 15.799415 576,363
American Century: Twentieth Century Ultra Fund:
Tax qualified .................................. 587,159 15.970158 9,377,022
Delaware Group Delchester High-Yield Bond Fund, Inc. -
Delchester Fund Institutional Class:
Tax qualified ................................. 88,659 14.445299 1,280,706
Dreyfus A Bonds Plus, Inc.:
Tax qualified ................................. 161,545 11.155948 1,802,188
Dreyfus S&P 500 Index Fund, Inc.:
Tax qualified ................................. 244,322 20.919413 5,111,073
The Dreyfus Third Century Fund, Inc.:
Tax qualified ................................. 29,751 18.371612 546,574
Evergreen Income and Growth Fund - Class Y:
Tax qualified ................................. 62,220 15.423843 959,672
Federated Investment Series Funds, Inc. -
Federated Bond Fund - Class F:
Tax qualified ................................. 28,041 10.420617 292,205
Fidelity Advisor Balanced Fund - Class T:
Tax qualified ................................. 7,805 12.347336 96,371
Fidelity Advisor Equity-Income Fund - Class T:
Tax qualified ................................. 72,278 13.282446 960,029
Fidelity Advisor Growth Opportunities Fund - Class T:
Tax qualified ................................. 286,656 13.716720 3,931,980
Fidelity Advisor High Yield Fund - Class T:
Tax qualified ................................. 133,356 11.808007 1,574,669
Fidelity Asset Manager(TM):
Tax qualified ................................. 233,994 13.751176 3,217,693
Fidelity Capital & Income Fund:
Tax qualified ................................. 28,071 43.434703 1,219,256
Fidelity Equity-Income Fund:
Tax qualified ................................. 246,894 64.473989 15,918,241
Fidelity Magellan(R)Fund:
Tax qualified ................................. 634,544 20.509068 13,013,906
Fidelity Puritan(R)Fund:
Tax qualified ................................. 549,341 18.549323 10,189,904
</TABLE>
18
<PAGE> 19
<TABLE>
<S> <C> <C> <C>
Fidelity VIP - High Income Portfolio:
Tax qualified ................................. 11,243 23.320029 262,187
Janus Fund:
Tax qualified ................................. 213,760 13.566351 2,899,943
Janus Twenty Fund:
Tax qualified ................................. 277,567 17.550234 4,871,366
Janus Worldwide Fund:
Tax qualified ................................. 195,055 12.195030 2,378,702
MFS(R)World Governments Fund - Class A:
Tax qualified ................................. 22,644 35.765728 809,879
Nationwide(R)Bond Fund:
Tax qualified ................................. 39,382 38.510870 1,516,635
Non-tax qualified ............................. 177 38.345774 6,787
Nationwide(R) Fund:
Tax qualified ................................. 37,845 86.766810 3,283,690
Non-tax qualified ............................. 314 90.376443 28,378
Nationwide(R) Growth Fund:
Tax qualified ................................. 46,390 88.806418 4,119,730
Non-tax qualified ............................. 230 93.768413 21,567
Nationwide(R) Money Market Fund:
Tax qualified - Pre 12/25/82 .................. 46,306 25.105010 1,162,513
Tax qualified ................................. 364,018 19.937325 7,257,545
Non-tax qualified 1,070 25.263671 27,032
Nationwide(R) U.S. Government Income Fund:
Tax qualified ................................. 4,287 10.575346 45,337
Neuberger & Berman Guardian Fund:
Tax qualified ................................. 424,883 16.438344 6,984,373
Neuberger & Berman Limited Maturity Bond Fund:
Tax qualified ................................. 70,469 11.332296 798,576
Neuberger & Berman Partners Fund:
Tax qualified ................................. 273,192 21.487003 5,870,077
Oppenheimer Global Fund - Class A:
Tax qualified ................................. 242,259 20.874396 5,057,010
Phoenix Balanced Fund Series - Class A:
Tax qualified ................................. 41,412 13.372440 553,779
Strong Total Return Fund, Inc.:
Tax qualified ................................. 78,726 18.732879 1,474,765
Templeton Foreign Fund - Class I:
Tax qualified ................................. 332,251 14.277936 4,743,859
Warburg Pincus Trust Emerging Growth Fund -
Common Shares:
Tax qualified ................................. 290,645 12.727183 3,699,092
======= =========
Reserves for annuity contracts in payout phase:
Tax qualified ................................. 213,189
----------
$ 142,010,802
=============
</TABLE>
See accompanying notes to financial statements.
================================================================================
19
<PAGE> 20
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
