<PAGE>
CML VARIABLE ANNUITY ACCOUNT B
B
ANNUAL REPORT
AT DECEMBER 31, 1995
<PAGE>
Dear Connecticut Mutual Investor:
We are pleased to report to you on the performance of your CML Variable Annuity
Account B. As of December 31, 1995, the accumulation unit value for the Account
was $13.91.
As you know, Account B is invested in the Growth Portfolio (the same Growth
Portfolio included in our Panorama Variable Annuity) which has as its objective
providing investors with long-term growth of capital through investment
primarily in a diversified portfolio of common stocks with low price-earnings
ratios and better than anticipated earnings reports. Using this discipline, our
investment professionals select undervalued stocks that have demonstrated an
ability to increase in a relatively short time frame.
Our Growth Portfolio has enjoyed strong performance over the years. So now
might be an opportune time to make an additional investment in Account B! Of
course, past performance does not guarantee future results. We've enclosed a
self-addressed envelope for your convenience. Please be sure to write your
contract number on your check.
The following Annual Report for CML Variable Annuity Account B contains the
financial statements for your annuity. The Annual Report for Panorama, which is
also included, contains a full report and schedule of investments for the Growth
Portfolio.
The Growth Portfolio is just one of the four top-quality investment portfolios
in Panorama. We've enclosed a brochure that introduces you to the Panorama
features. With Panorama, investors can choose among the Growth Portfolio, the
Total Return Portfolio, the Income Portfolio and the Money Market Portfolio.
Also, with Panorama there is no initial sales charge, so each premium dollar
immediately goes to work for you (a surrender charge may apply to withdrawals).
If your needs change, Panorama lets you transfer your money among its four
Portfolios whenever you want, with no penalties or tax repercussions.
To learn how you can increase your investment flexibility with Panorama, call
1-800-234-5606 and press three to speak to a Sales Associate. A prospectus,
describing Panorama's features and charges, along with information on how to
transfer your current contract assets, will be sent to you free of charge.
Please read the prospectus carefully before you invest or send money.
We at Connecticut Mutual Financial Services enjoy serving you and are committed
to helping you achieve your financial goals.
Sincerely,
/s/ Donald H. Pond, Jr.
Donald H. Pond, Jr.
President
Connecticut Mutual Financial Services Series Fund I, Inc.
1
<PAGE>
CML VARIABLE ANNUITY
ACCOUNT B
STATEMENT OF NET ASSETS
December 31, 1995
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Investments, at market:
Connecticut Mutual Financial Services
Series Fund I, Inc.
Growth Portfolio
332,656 shares (Cost $552,756) $840,111
Due from affiliates 18,942
Cash 16
--------
TOTAL ASSETS 859,069
--------
LIABILITIES
Due to Affiliates 356
--------
NET ASSETS, applicable to:
46,887 accumulation units
outstanding at $13.913055 per unit 652,341
Annuity reserves, 14,833 units
outstanding at $13.913055 per unit 206,372
--------
TOTAL NET ASSETS $858,713
--------
--------
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
CML VARIABLE ANNUITY
ACCOUNT B
STATEMENT OF OPERATIONS
For the Year Ended
December 31, 1995
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C>
Income:
Dividends $ 58,653
Expenses:
Mortality and expense risk fees 3,789
--------
NET INVESTMENT INCOME 54,864
--------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Realized gain from investment transactions 32,515
--------
Unrealized appreciation on investments:
Beginning of year 133,282
End of year 287,355
--------
Net unrealized appreciation during the year 154,073
--------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS 186,588
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $241,452
--------
--------
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
CML VARIABLE ANNUITY
ACCOUNT B
STATEMENTS OF CHANGES
IN NET ASSETS
For the Years Ended
December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
FROM OPERATIONS
Net investment income $ 54,864 $ 29,170
Net Realized gain from investment transactions 32,515 14,103
Net unrealized appreciation (depreciation) during
the year 154,073 (52,017)
-------- ---------
Net increase (decrease) in net assets resulting
from operations 241,452 (8,744)
-------- ---------
FROM UNIT TRANSACTIONS
Purchases by contract holders 2,800 2,800
Less: Sales and administrative expenses and
applicable premium taxes 224 217
-------- ---------
Net purchase payments 2,576 2,583
Withdrawals by contract holders (66,577) (62,242)
-------- ---------
Net decrease in net assets from unit transactions (64,001) (59,659)
-------- ---------
Net increase (decrease) in net assets 177,451 (68,403)
NET ASSETS
Beginning of year 681,262 749,665
-------- ---------
End of year $858,713 $681,262
-------- ---------
-------- ---------
</TABLE>
The accompanying notes are an integral part of these financial statements
4
<PAGE>
CML VARIABLE ANNUITY
ACCOUNT B
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. ORGANIZATION:
CML Variable Annuity Account B (the Account) is a separate account within
Connecticut Mutual Life Insurance Company (Connecticut Mutual). Although the
Account is an integral part of Connecticut Mutual, it is registered as a unit
investment trust under the Investment Company Act of 1940, as amended. The
assets attributable to contracts participating in the Account are held for the
benefit of the participants and are not chargeable with liabilities arising out
of any other business that Connecticut Mutual may conduct.
The Account is invested exclusively in the Growth Portfolio of Connecticut
Mutual Financial Services Series Fund I, Inc. (the Fund). Net purchase payments
are applied to purchase Fund shares at the net asset value determined as of the
end of the valuation period during which the payments were received.
2. SIGNIFICANT ACCOUNTING POLICIES:
(a) Fund Share Transactions --
Fund share transactions are recorded on the trade date. The cost of Fund
shares sold is determined on the basis of identified cost.
(b) Valuation of Investments --
The investment in shares of the Fund is valued at the closing net asset
value per share on December 31, 1995. Valuation of securities of the Fund
is discussed in Note 1 of the Fund's December 31, 1995 Notes to Financial
Statements.
(c) Federal Income Taxes --
The operations of the Account form a part of Connecticut Mutual's total
operations and are not taxed separately. Connecticut Mutual is taxed as a
life insurance company under the life insurance tax provisions of the
Internal Revenue Code of 1986, as amended. The Account will not be taxed
as a regulated investment company under Subchapter M of the Internal
Revenue Code. Accordingly, no provision for income taxes has been
required in the accompanying financial statements.
(d) Annuity Reserves --
Annuity reserves are computed according to the Progressive Annuity Table
at 3 1/2% interest, adjusted for the investment performance of the
Account.
3. CONTRACT CHARGES:
For assuming mortality and expense risks, and any income tax liability which may
be incurred by Connecticut Mutual with regard to non-qualified assets,
Connecticut Mutual makes a daily charge equal to .00135% (.49275% on an annual
basis assuming 365 days per year) of the value of the Account's assets.
4. SUBSEQUENT EVENT:
On September 8, 1995, the Board of Directors of Connecticut Mutual approved the
merger of Connecticut Mutual and Massachusetts Mutual Life Insurance Company.
Thereafter, a definitive agreement was signed by both companies. On January 27,
1996, Connecticut Mutual and its insurance subsidiary policyholders and other
insureds and annuitants approved the merger. The merger was subsequently
reviewed by the insurance regulatory authorities in Connecticut and
Massachusetts and approved. It is anticipated that the merger will be effective
on March 1, 1996.
5
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Owners of Variable Annuity Contracts of CML
Variable Annuity Account B:
We have audited the accompanying statement of net assets of CML Variable
Annuity Account B (the Account) as of December 31, 1995, and the related
statement of operations for the year then ended and the statements of changes in
net assets for each of the two years in the period then ended. These financial
statements are the responsibility of the Account's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of CML Variable Annuity Account
B as of December 31, 1995, the results of its operations for the year then ended
and the changes in its net assets for each of the two years in the period then
ended, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Hartford, Connecticut
February 15, 1996
6
<PAGE>
This report is prepared for the general information of contract holders and is
not an offer of shares of this Account. It should not be used in connection
with any offer except in conjunction with the Prospectus which contains all
pertinent information including the applicable sales charges.
Distributed through
G.R. Phelps & Co., Inc.
a subsidiary of
[LOGO]CONNECTICUT MUTUAL
The Blue Chip Company-Registered Trademark-
Connecticut Mutual
Life Insurance Company
140 Garden Street
Hartford, CT 06154
(203) 987-6500
L996
