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Previous: DREYFUS APPRECIATION FUND INC, 497, 1997-05-01 |
Next: FIDELITY INTERNATIONAL LTD, SC 13D/A, 1997-05-01 |
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
ANNUAL REPORT
DECEMBER 31, 1996
The investment results presented in this report are historical and are no
indication of future performance.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Receiver of Monarch Life Insurance Company
and Policyholders of Variable Account A of Monarch Life Insurance Company
In our opinion, the accompanying statements of net assets and the related
statements of operations and changes in net assets present fairly, in all
material respects, the financial position of the Money Reserve, Intermediate
Government Bond, Long-Term Corporate Bond, Capital Stock, Growth Stock, Multiple
Strategy, High Yield, Natural Resources, Global Strategy, Balanced, and U.S.
Treasury Securities, Series A through K 1994 Trust through 2011 Trust, 2013
Trust and 2014 Trust Divisions (constituting Variable Account A of Monarch Life
Insurance Company) at December 31, 1996 and 1995 and the results of each of
their operations and changes in their net assets for each of the three years in
the period ended December 31, 1996, in conformity with generally accepted
accounting principles. These financial statements are the responsibility of
Monarch Life Insurance Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which 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, assessing the
accounting principles used and significant estimates made by management and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of investments at December 31, 1996, by
correspondence with the Series Fund and Trusts, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
March 21, 1997
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS AT DECEMBER 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS Cost Shares/Units Market Value
------------------ ------------------ ------------------
<S> <C> <C> <C>
Investment in Merrill Lynch Series Fund, Inc.,
at Market Value (Note 2):
Money Reserve Portfolio $ 32,782,533 32,782,533 $ 32,782,534
Intermediate Government Bond Portfolio 10,710,820 938,924 10,262,439
Long-Term Corporate Bond Portfolio 8,628,059 730,109 8,418,154
Capital Stock Portfolio 21,420,378 996,889 23,177,677
Growth Stock Portfolio 17,234,106 741,320 20,601,277
Multiple Strategy Portfolio 72,868,181 4,428,346 75,857,566
High Yield Portfolio 14,676,800 1,633,180 14,943,600
Natural Resources Portfolio 1,704,081 194,791 1,790,132
Global Strategy Portfolio 6,713,405 450,834 7,574,011
Balanced Portfolio 3,795,929 269,851 4,144,916
------------------ ------------------
190,534,292 199,552,306
------------------ ------------------
Investment in The Merrill Lynch Fund of Stripped U.S. Treasury Securities,
Series A through K at Market Value (Note 2):
1997 Trust 986,447 1,235,894 1,232,063
1998 Trust 516,908 628,708 591,709
1999 Trust 152,093 202,729 179,519
2000 Trust 726,220 1,037,653 864,749
2001 Trust 701,583 1,241,477 973,641
2002 Trust 20,166 36,256 26,608
2003 Trust 834,915 1,849,560 1,227,886
2004 Trust 32,818 55,389 35,449
2005 Trust 760,870 1,467,750 885,758
2006 Trust 138,561 325,580 186,746
2007 Trust 217,711 645,991 345,004
2008 Trust 488,259 1,710,870 835,503
2009 Trust 183,746 395,894 180,567
2010 Trust 169,671 411,798 173,660
2011 Trust 21,067 65,042 25,848
2013 Trust 28,315 90,199 30,937
2014 Trust 1,384,112 4,564,249 1,442,896
------------------ ------------------
7,363,462 9,238,543
------------------ ------------------
Total Invested Assets $ 197,897,754 $ 208,790,849
================== ==================
</TABLE>
The accompanying Notes are an integral part of these financial statments.
2
<PAGE>
<TABLE>
<CAPTION>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS AT DECEMBER 31, 1996 (Continued)
================================================================================
<S> <C>
Total Invested Assets, at Market Value $ 208,790,849
Pending Trades 279,264
------------------
Total Assets 209,070,113
------------------
LIABILITIES
Payable to Monarch Life Insurance Company 2,794,098
------------------
Total Liabilities 2,794,098
------------------
Net Assets $ 206,276,015
==================
NET ASSETS
For Variable Life Insurance Policies $ 205,878,054
Retained in the Account by Monarch Life Insurance Company (Note 6) 397,961
------------------
Total Net Assets $ 206,276,015
==================
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS AT DECEMBER 31, 1995
================================================================================
ASSETS Cost Shares/Units Market Value
------------------ ------------------ -----------------
<S> <C> <C> <C>
Investment in Merrill Lynch Series Fund, Inc.,
at Market Value (Note 2):
Money Reserve Portfolio $ 37,035,827 37,035,827 $ 37,035,827
Intermediate Government Bond Portfolio 11,964,048 1,035,110 11,810,605
Long-Term Corporate Bond Portfolio 9,376,494 790,261 9,498,943
Capital Stock Portfolio 20,315,941 915,020 21,850,682
Growth Stock Portfolio 15,218,628 764,814 18,401,420
Multiple Strategy Portfolio 70,996,781 4,328,376 74,621,200
High Yield Portfolio 12,804,445 1,440,014 12,945,730
Natural Resources Portfolio 1,148,071 144,007 1,176,541
Global Strategy Portfolio 6,749,853 456,416 6,960,345
Balanced Portfolio 3,927,891 281,932 4,189,516
------------------ -----------------
189,537,979 198,490,809
------------------ -----------------
Investment in The Merrill Lynch Fund of Stripped U.S. Treasury Securities,
Series A through K at Market Value (Note 2):
1996 Trust 531,655 605,300 602,146
1997 Trust 1,118,126 1,456,639 1,380,996
1998 Trust 546,738 676,098 607,630
1999 Trust 228,248 314,851 268,035
2000 Trust 832,269 1,227,313 991,460
2001 Trust 725,660 1,391,971 1,066,834
2002 Trust 20,610 37,110 26,809
2003 Trust 838,162 1,991,659 1,316,287
2004 Trust 39,358 66,426 42,497
2005 Trust 858,112 1,728,449 1,050,153
2006 Trust 82,886 236,533 137,350
2007 Trust 221,679 664,538 361,808
2008 Trust 558,265 2,002,621 1,003,313
2009 Trust 156,363 431,929 203,447
2010 Trust 145,396 400,400 175,231
2011 Trust 72,114 253,105 104,515
2013 Trust 21,491 92,826 33,422
2014 Trust 1,179,340 3,817,366 1,275,229
------------------ -----------------
8,176,472 10,647,162
------------------ -----------------
Total Invested Assets $ 197,714,451 $ 209,137,971
================== =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS AT DECEMBER 31, 1995 (Continued)
================================================================================
<S> <C>
Total Invested Assets, at Market Value $ 209,137,971
Receivable from Securities Sold 301,028
-----------------
Total Assets 209,438,999
-----------------
LIABILITIES
Payable to Monarch Life Insurance Company 2,787,716
Pending Trades 23,267
-----------------
Total Liabilities 2,810,983
-----------------
Net Assets $ 206,628,016
=================
NET ASSETS
For Variable Life Insurance Policies $ 205,460,641
Retained in the Account by Monarch Life Insurance Company (See Note 6) 1,167,375
-----------------
Total Net Assets $ 206,628,016
=================
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 and 1994
================================================================================
<TABLE>
<CAPTION>
TOTALS - ALL DIVISIONS
----------------------------------------------------------------
1996 1995 1994
------------------ ------------------ -----------------
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 18,987,183 $ 15,629,614 $ 25,996,668
Risk Charges and Administrative Expenses (Note 3) (1,187,489) (1,205,355) (1,805,685)
Transaction Charges (Note 4) (33,193) (39,856) (46,666)
------------------ ------------------ ------------------
Net Investment Income 17,766,501 14,384,403 24,144,317
------------------ ------------------ ------------------
Net Realized Gains 3,392,898 2,794,966 2,602,180
Net Unrealized Gains (Losses) (530,425) 14,248,391 (35,959,961)
------------------ ------------------ ------------------
Net Realized and Unrealized Gains (Losses) 2,862,473 17,043,357 (33,357,781)
------------------ ------------------ ------------------
Net Decrease in Net Assets
Resulting from Operations 20,628,974 31,427,760 (9,213,464)
------------------ ------------------ ------------------
Transfers of Net Premiums 6,678,446 7,752,891 10,286,389
Transfers of Policy Loading, Net (826,215) (1,338,207) (1,949,708)
Transfers Due to Deaths (2,089,356) (1,923,390) (1,079,467)
Transfers Due to Other Terminations (15,546,388) (27,239,633) (41,501,886)
Transfers Due to Policy Loans (3,202,534) (5,682,987) (8,424,647)
Transfers of Cost of Insurance (5,420,400) (4,122,936) (6,692,074)
Transfers of Loan Processing Charges (574,528) (560,865) (113,254)
Transfers Among Investment Divisions -- -- --
------------------ ------------------ ------------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (20,980,975) (33,115,127) (49,474,647)
------------------ ------------------ ------------------
Total Decreases in Net Assets (352,001) (1,687,367) (58,688,111)
Net Assets - Beginning Balance 206,628,016 208,315,383 267,003,494
------------------ ------------------ ------------------
Net Assets - Ending Balance $ 206,276,015 $ 206,628,016 $ 208,315,383
================== ================== ==================
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 and 1994
================================================================================
<TABLE>
<CAPTION>
Intermediate
Money Government
Reserve Bond
Total Division Division
--------------------- ----------------- ----------------
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 18,987,183 $ 1,953,814 $ 740,427
Risk Charges and Administrative Expenses (Note 3) (1,187,489) (218,895) (60,260)
Transaction Charges (Note 4) (33,193) -- --
--------------------- ----------------- ----------------
Net Investment Income (Loss) 17,766,501 1,734,919 680,167
--------------------- ----------------- ----------------
Net Realized Gains (Losses) 3,392,898 -- (205,868)
Net Unrealized Gains (Losses) (530,425) -- (294,938)
--------------------- ----------------- ----------------
Net Realized and Unrealized Gains (Losses) 2,862,473 -- (500,806)
--------------------- ----------------- ----------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 20,628,974 1,734,919 179,361
--------------------- ----------------- ----------------
Transfers of Net Premiums 6,678,446 1,390,653 376,810
Transfers of Policy Loading, Net (826,215) (186,546) (30,199)
Transfers Due to Deaths (2,089,356) (539,195) (320,149)
Transfers Due to Other Terminations (15,546,388) (4,071,685) (622,483)
Transfers Due to Policy Loans (3,202,534) (808,391) (199,883)
Transfers of Cost of Insurance (5,420,400) (1,096,123) (197,432)
Transfers of Loan Processing Charges (574,528) (148,506) (22,179)
Transfers Among Investment Divisions -- (707,280) (707,920)
--------------------- ----------------- ----------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (20,980,975) (6,167,073) (1,723,435)
--------------------- ----------------- ----------------
Total Increase (Decrease) in Net Assets (352,001) (4,432,154) (1,544,074)
Net Assets - Beginning Balance 206,628,016 34,550,651 11,812,232
--------------------- ----------------- ----------------
Net Assets - Ending Balance $ 206,276,015 $ 30,118,497 $ 10,268,158
===================== ================= ================
<CAPTION>
Long-Term
Corporate Capital Growth
Bond Stock Stock
Division Division Division
---------------- ------------------ --------------------
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 606,161 $ 3,648,547 $ 630,799
Risk Charges and Administrative Expenses (Note 3) (47,967) (127,867) (105,641)
Transaction Charges (Note 4) -- -- --
---------------- ------------------ --------------------
Net Investment Income (Loss) 558,194 3,520,680 525,158
---------------- ------------------ --------------------
Net Realized Gains (Losses) (58,852) (553,576) 2,366,424
Net Unrealized Gains (Losses) (332,355) 222,558 184,380
---------------- ------------------ --------------------
Net Realized and Unrealized Gains (Losses) (391,207) (331,018) 2,550,804
---------------- ------------------ --------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 166,987 3,189,662 3,075,962
---------------- ------------------ --------------------
Transfers of Net Premiums 469,719 983,546 589,029
Transfers of Policy Loading, Net (22,352) (74,123) (70,623)
Transfers Due to Deaths (150,387) (288,823) (130,987)
Transfers Due to Other Terminations (493,596) (1,656,408) (1,218,537)
Transfers Due to Policy Loans (207,878) (364,439) (543,659)
Transfers of Cost of Insurance (291,535) (657,865) (558,150)
Transfers of Loan Processing Charges (25,695) (52,769) (52,671)
Transfers Among Investment Divisions (516,212) 362,333 1,109,839
---------------- ------------------ --------------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (1,237,936) (1,748,548) (875,759)
---------------- ------------------ --------------------
Total Increase (Decrease) in Net Assets (1,070,949) 1,441,114 2,200,203
Net Assets - Beginning Balance 9,499,738 21,803,966 18,401,073
---------------- ------------------ --------------------
Net Assets - Ending Balance $ 8,428,789 $ 23,245,080 $ 20,601,276
================ ================== ====================
</TABLE>
<TABLE>
<CAPTION>
Multiple High
Strategy Yield
Division Division
----------------- -------------------
<S> <C> <C>
Investment Income:
Dividends (Note 2) $ 9,895,507 $ 1,013,989
Risk Charges and Administrative Expenses (Note 3) (425,770) (65,968)
Transaction Charges (Note 4) -- --
----------------- -------------------
Net Investment Income (Loss) 9,469,737 948,021
----------------- -------------------
Net Realized Gains (Losses) 657,056 320,976
Net Unrealized Gains (Losses) (635,033) 125,517
----------------- -------------------
Net Realized and Unrealized Gains (Losses) 22,023 446,493
----------------- -------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 9,491,760 1,394,514
----------------- -------------------
Transfers of Net Premiums 2,304,353 85,778
Transfers of Policy Loading, Net (267,746) (55,165)
Transfers Due to Deaths (627,831) --
Transfers Due to Other Terminations (5,392,022) (598,006)
Transfers Due to Policy Loans (917,996) (192,457)
Transfers of Cost of Insurance (1,908,400) (206,994)
Transfers of Loan Processing Charges (168,573) (35,076)
Transfers Among Investment Divisions (1,267,633) 1,605,252
----------------- -------------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (8,245,848) 603,332
----------------- -------------------
Total Increase (Decrease) in Net Assets 1,245,912 1,997,846
Net Assets - Beginning Balance 74,611,642 12,945,754
----------------- -------------------
Net Assets - Ending Balance $ 75,857,554 $ 14,943,600
================= ===================
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1996 (Continued)
================================================================================
<TABLE>
<CAPTION>
Natural Global
Resources Strategy Balanced 1996
Division Division Division Division
-------------- ---------------- =============== ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 27,129 $ 221,559 $ 249,251 $ --
Risk Charges and Administrative Expenses (Note 3) (9,175) (44,704) (25,918) (446)
Transaction Charges (Note 4) -- -- -- (258)
-------------- ---------------- --------------- --------------
Net Investment Income (Loss) 17,954 176,855 223,333 (704)
-------------- ---------------- --------------- --------------
Net Realized Gains (Losses) 117,627 97,571 56,553 73,608
Net Unrealized Gains (Losses) 57,580 650,114 87,362 (70,492)
-------------- ---------------- --------------- --------------
Net Realized and Unrealized Gains (Losses) 175,207 747,685 143,915 3,116
-------------- ---------------- --------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 193,161 924,540 367,248 2,412
-------------- ---------------- --------------- --------------
Transfers of Net Premiums 33,315 206,976 172,212 205
Transfers of Policy Loading, Net (9,483) (39,817) (18,958) (1,313)
Transfers Due to Deaths -- (21,707) -- --
Transfers Due to Other Terminations (54,938) (501,822) (205,624) 3,707
Transfers Due to Policy Loans 26,230 3,943 (92,423) --
Transfers of Cost of Insurance (37,113) (166,307) (105,104) 3,002
Transfers of Loan Processing Charges (8,291) (25,441) (8,428) (243)
Transfers Among Investment Divisions 488,528 251,982 (153,712) (609,681)
-------------- ---------------- --------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 438,248 (292,193) (412,037) (604,323)
-------------- ---------------- --------------- --------------
Total Increase (Decrease) in Net Assets 631,409 632,347 (44,789) (601,911)
Net Assets - Beginning Balance 1,176,526 6,989,618 4,189,705 601,911
-------------- ---------------- --------------- --------------
Net Assets - Ending Balance $ 1,807,935 $ 7,621,965 $ 4,144,916 $ --
============== ================ =============== ==============
</TABLE>
<TABLE>
<CAPTION>
1997 1998 1999 2000
Division Division Division Division
============== ============== ============= =============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (7,711) (3,161) (1,089) (5,303)
Transaction Charges (Note 4) (4,581) (2,016) (718) (3,212)
------------- -------------- ------------- -------------
Net Investment Income (Loss) (12,292) (5,177) (1,807) (8,515)
------------- -------------- ------------- -------------
Net Realized Gains (Losses) 84,336 13,159 19,268 47,545
Net Unrealized Gains (Losses) (17,253) 13,909 (12,362) (20,662)
------------- -------------- ------------- -------------
Net Realized and Unrealized Gains (Losses) 67,083 27,068 6,906 26,883
------------- -------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 54,791 21,891 5,099 18,368
------------- -------------- ------------- -------------
Transfers of Net Premiums 15,705 468 666 171
Transfers of Policy Loading, Net (5,073) (1,859) (324) (4,263)
Transfers Due to Deaths (2,014) -- -- --
Transfers Due to Other Terminations (172,040) (25,336) (48,988) (120,722)
Transfers Due to Policy Loans 18,991 (4,085) 53 9,478
Transfers of Cost of Insurance (22,897) (10,246) (3,089) (16,487)
Transfers of Loan Processing Charges (2,009) (1,455) 58 (1,431)
Transfers Among Investment Divisions (34,403) 4,702 (41,993) (11,822)
------------- -------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (203,740) (37,811) (93,617) (145,076)
------------- -------------- ------------- -------------
Total Increase (Decrease) in Net Assets (148,949) (15,920) (88,518) (126,708)
Net Assets - Beginning Balance 1,380,980 607,615 268,016 991,436
------------- -------------- ------------- -------------
Net Assets - Ending Balance $1,232,031 $ 591,695 $ 179,498 $ 864,728
============== ============== ============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1995 (Continued)
================================================================================
<TABLE>
<CAPTION>
2001 2002 2003 2004 2005
Division Division Division Division Division
============== ============= ============== ============= ==============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (5,445) (161) (7,458) (193) (5,050)
Transaction Charges (Note 4) (3,424) (89) (4,297) (126) (3,067)
-------------- ------------- -------------- ------------- --------------
Net Investment Income (Loss) (8,869) (250) (11,755) (319) (8,117)
-------------- ------------- -------------- ------------- --------------
Net Realized Gains (Losses) 89,217 162 87,312 338 51,549
Net Unrealized Gains (Losses) (69,116) 244 (85,155) (509) (67,154)
-------------- ------------- -------------- ------------- --------------
Net Realized and Unrealized Gains (Losses) 20,101 406 2,157 (171) (15,605)
-------------- ------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 11,232 156 (9,598) (490) (23,722)
-------------- ------------- -------------- ------------- --------------
Transfers of Net Premiums 1,235 -- 7,967 122 2,530
Transfers of Policy Loading, Net (3,230) (22) (5,073) (700) (603)
Transfers Due to Deaths (2,479) -- (2,735) -- --
Transfers Due to Other Terminations (131,950) 4 (144,534) 41 321
Transfers Due to Policy Loans 34,414 -- 93,036 -- (11,564)
Transfers of Cost of Insurance (19,122) (332) (18,976) (4,131) (12,069)
Transfers of Loan Processing Charges (2,186) 1 (1,375) (1,772) (947)
Transfers Among Investment Divisions 18,896 (12) (7,112) (116) (118,339)
-------------- ------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (104,422) (361) (78,802) (6,556) (140,671)
-------------- ------------- -------------- ------------- --------------
Total Increase (Decrease) in Net Assets (93,190) (205) (88,400) (7,046) (164,393)
Net Assets - Beginning Balance 1,066,808 26,789 1,316,254 42,479 1,050,127
-------------- ------------- -------------- ------------- --------------
Net Assets - Ending Balance $ 973,618 $ 26,584 $1,227,854 $ 35,433 $ 885,734
============== ============= ============== ============= ==============
<CAPTION>
2006 2007 2008
Division Division Division
============== ============= =============
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (883) (2,076) (4,519)
Transaction Charges (Note 4) (547) (1,145) (3,014)
-------------- ------------- -------------
Net Investment Income (Loss) (1,430) (3,221) (7,533)
-------------- ------------- -------------
Net Realized Gains (Losses) 6,992 5,571 67,938
Net Unrealized Gains (Losses) (6,280) (12,835) (97,804)
-------------- ------------- -------------
Net Realized and Unrealized Gains (Losses) 712 (7,264) (29,866)
-------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (718) (10,485) (37,399)
-------------- ------------- -------------
Transfers of Net Premiums 1,172 4,854 7,502
Transfers of Policy Loading, Net (1,478) (1,392) (636)
Transfers Due to Deaths (3,049) -- --
Transfers Due to Other Terminations (10,922) 39 182
Transfers Due to Policy Loans -- 1,733 (7,994)
Transfers of Cost of Insurance (2,983) (9,363) (32,110)
Transfers of Loan Processing Charges (216) (2,114) (4,719)
Transfers Among Investment Divisions 67,591 (110) (92,632)
-------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 50,115 (6,353) (130,407)
-------------- ------------- -------------
Total Increase (Decrease) in Net Assets 49,397 (16,838) (167,806)
Net Assets - Beginning Balance 137,343 361,833 1,003,290
-------------- ------------- -------------
Net Assets - Ending Balance $ 186,740 $ 344,995 $ 835,484
============== ============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1995 (Continued)
================================================================================
<TABLE>
<CAPTION>
2009 2010 2011 2013 2014
Division Division Division Division Division
============== ============= ============== ============= ==============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (1,599) (1,164) (262) (183) (8,621)
Transaction Charges (Note 4) (895) (653) (134) (106) (4,911)
-------------- ------------- -------------- ------------- --------------
Net Investment Income (Loss) (2,494) (1,817) (396) (289) (13,532)
-------------- ------------- -------------- ------------- --------------
Net Realized Gains (Losses) 22,760 13,518 19,215 6,649 (14,150)
Net Unrealized Gains (Losses) (50,263) (25,847) (27,619) (9,308) (37,104)
-------------- ------------- -------------- ------------- --------------
Net Realized and Unrealized Gains (Losses) (27,503) (12,329) (8,404) (2,659) (51,254)
-------------- ------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (29,997) (14,146) (8,800) (2,948) (64,786)
-------------- ------------- -------------- ------------- --------------
Transfers of Net Premiums 4,254 620 1,911 -- 16,673
Transfers of Policy Loading, Net (3,766) (5,610) (306) 601 (16,156)
Transfers Due to Deaths -- -- -- -- --
Transfers Due to Other Terminations (151) (134) (57,880) (40) (22,864)
Transfers Due to Policy Loans 60 1,795 (12,439) -- (29,059)
Transfers of Cost of Insurance (6,636) (2,047) (348) (305) (37,238)
Transfers of Loan Processing Charges (1,957) (363) 72 (10) (6,233)
Transfers Among Investment Divisions 15,313 18,338 (871) 204 326,870
-------------- ------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 7,117 12,599 (69,861) 450 231,993
-------------- ------------- -------------- ------------- --------------
Total Increase (Decrease) in Net Assets (22,880) (1,547) (78,661) (2,498) 167,207
Net Assets - Beginning Balance 203,442 175,227 104,493 33,415 1,275,653
-------------- ------------- -------------- ------------- --------------
Net Assets - Ending Balance $ 180,562 $ 173,680 $ 25,832 $ 30,917 $ 1,442,860
============== ============= ============== ============= ==============
The accompanying notes are an integral part of these financial statements.
</TABLE>
10
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1995 (Continued)
================================================================================
<TABLE>
<CAPTION>
Intermediate Long-Term
Money Government Corporate
Reserve Bond Bond
Total Division Division Division
================= ================ =============== ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 15,629,614 $ 2,393,549 $ 881,130 $ 662,908
Risk Charges and Administrative Expenses (Note 3) (1,205,355) (248,845) (68,433) (49,407)
Transaction Charges (Note 4) (39,856) -- -- --
----------------- ---------------- --------------- --------------
Net Investment Income 14,384,403 2,144,704 812,697 613,501
----------------- ---------------- --------------- --------------
Net Realized Gains (Losses) 2,794,966 -- (116,529) (91,306)
Net Unrealized Gains (Losses) 14,248,391 -- 1,339,195 1,133,794
----------------- ---------------- --------------- --------------
Net Realized and Unrealized Gains 17,043,357 -- 1,222,666 1,042,488
----------------- ---------------- --------------- --------------
Net Increase in Net Assets
Resulting from Operations 31,427,760 2,144,704 2,035,363 1,655,989
----------------- ---------------- --------------- --------------
Transfers of Net Premiums 7,752,891 1,654,257 418,910 521,103
Transfers of Policy Loading, Net (1,338,207) (498,785) (58,553) (29,413)
Transfers Due to Deaths (1,923,390) (504,352) (67,458) (105,191)
Transfers Due to Other Terminations (27,239,633) (7,195,392) (1,740,884) (1,085,390)
Transfers Due to Policy Loans (5,682,987) (830,160) (307,187) (309,937)
Transfers of Cost of Insurance (4,122,936) 7,514 (286,848) (330,600)
Transfers of Loan Processing Charges (560,865) (162,739) (23,972) (27,343)
Transfers Among Investment Divisions -- (3,188,763) 241,980 431,116
----------------- ---------------- --------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (33,115,127) (10,718,420) (1,824,012) (935,655)
----------------- ---------------- --------------- --------------
Total Increase (Decrease) in Net Assets (1,687,367) (8,573,716) 211,351 720,334
Net Assets - Beginning Balance 208,315,383 43,124,367 11,600,881 8,779,404
----------------- ---------------- --------------- --------------
Net Assets - Ending Balance $ 206,628,016 $ 34,550,651 $ 11,812,232 $ 9,499,738
================= ================ =============== ==============
<CAPTION>
Capital Growth Multiple High
Stock Stock Strategy Yield
Division Division Division Division
============== ================ =============== ===============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 1,844,220 $ 1,017,841 $ 7,113,129 $ 947,625
Risk Charges and Administrative Expenses (Note 3) (125,066) (90,670) (419,263) (59,652)
Transaction Charges (Note 4) -- -- -- --
-------------- ---------------- --------------- ---------------
Net Investment Income 1,719,154 927,171 6,693,866 887,973
-------------- ---------------- --------------- ---------------
Net Realized Gains (Losses) 33,100 (155,280) 1,181,375 534,784
Net Unrealized Gains (Losses) 2,251,298 4,012,236 3,579,711 203,166
-------------- ---------------- --------------- ---------------
Net Realized and Unrealized Gains 2,284,398 3,856,956 4,761,086 737,950
-------------- ---------------- --------------- ---------------
Net Increase in Net Assets
Resulting from Operations 4,003,552 4,784,127 11,454,952 1,625,923
-------------- ---------------- --------------- ---------------
Transfers of Net Premiums 1,091,133 659,703 2,747,978 90,251
Transfers of Policy Loading, Net (97,153) (74,068) (368,908) (52,219)
Transfers Due to Deaths (224,327) (141,518) (475,912) (106,172)
Transfers Due to Other Terminations (3,384,750) (2,461,771) (8,414,165) (265,484)
Transfers Due to Policy Loans (1,131,109) (406,176) (1,330,002) (428,919)
Transfers of Cost of Insurance (612,948) (447,075) (1,801,898) (169,062)
Transfers of Loan Processing Charges (45,598) (46,515) (160,359) (31,242)
Transfers Among Investment Divisions 1,042,518 2,733,312 388,435 227,947
-------------- ---------------- --------------- ---------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (3,362,234) (184,108) (9,414,831) (734,900)
-------------- ---------------- --------------- ---------------
Total Increase (Decrease) in Net Assets 641,318 4,600,019 2,040,121 891,023
Net Assets - Beginning Balance 21,162,648 13,801,054 72,571,521 12,054,731
-------------- ---------------- --------------- ---------------
Net Assets - Ending Balance $ 21,803,966 $ 18,401,073 $ 74,611,642 $ 12,945,754
============== ================ =============== ===============
</TABLE>
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
Natural Global
Resources Strategy Balanced 1995
Division Division Division Division
============== ============= ============= ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 25,061 $ 444,315 $ 299,836 $ --
Risk Charges and Administrative Expenses (Note 3) (7,254) (47,738) (23,603) (8,949)
Transaction Charges (Note 4) -- -- -- (5,852)
-------------- ------------- ------------- --------------
Net Investment Income 17,807 396,577 276,233 (14,801)
-------------- ------------- ------------- --------------
Net Realized Gains (Losses) 35,772 (276,686) 54,721 548,146
Net Unrealized Gains (Losses) 81,456 589,623 401,879 (432,073)
-------------- ------------- ------------- --------------
Net Realized and Unrealized Gains 117,228 312,937 456,600 116,073
-------------- ------------- ------------- --------------
Net Increase in Net Assets
Resulting from Operations 135,035 709,514 732,833 101,272
-------------- ------------- ------------- --------------
Transfers of Net Premiums 38,032 269,695 193,695 8,095
Transfers of Policy Loading, Net (12,686) (63,489) (26,682) (11,465)
Transfers Due to Deaths (236) (34,995) (168) --
Transfers Due to Other Terminations (105,770) (1,181,864) (386,284) (237,910)
Transfers Due to Policy Loans 19,901 (306,809) (262,728) (62,738)
Transfers of Cost of Insurance (27,011) (155,716) (110,740) (11,266)
Transfers of Loan Processing Charges (6,809) (21,094) (8,517) (3,035)
Transfers Among Investment Divisions (71,471) (1,394,953) 481,889 (1,898,379)
-------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (166,050) (2,889,225) (119,535) (2,216,698)
-------------- ------------- ------------- --------------
Total Increase (Decrease) in Net Assets (31,015) (2,179,711) 613,298 (2,115,426)
Net Assets - Beginning Balance 1,207,541 9,169,329 3,576,407 2,115,426
-------------- ------------- ------------- --------------
Net Assets - Ending Balance $ 1,176,526 $ 6,989,618 $ 4,189,705 $ --
============== ============= ============= ==============
<CAPTION>
1996 1997 1998 1999
Division Division Division Division
============= ============== ============= ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (4,692) (8,118) (4,299) (1,345)
Transaction Charges (Note 4) (2,817) (4,824) (2,677) (862)
------------- -------------- ------------- --------------
Net Investment Income (7,509) (12,942) (6,976) (2,207)
------------- -------------- ------------- --------------
Net Realized Gains (Losses) 110,733 91,641 121,899 5,510
Net Unrealized Gains (Losses) (47,668) 53,188 (19,935) 32,729
------------- -------------- ------------- --------------
Net Realized and Unrealized Gains 63,065 144,829 101,964 38,239
------------- -------------- ------------- --------------
Net Increase in Net Assets
Resulting from Operations 55,556 131,887 94,988 36,032
------------- -------------- ------------- --------------
Transfers of Net Premiums 680 17,202 1,005 666
Transfers of Policy Loading, Net (8,414) (8,088) (3,139) (1,286)
Transfers Due to Deaths -- (950) -- --
Transfers Due to Other Terminations (142,529) (110,739) (43,179) (105)
Transfers Due to Policy Loans (169,822) (14,258) (65,676) 51
Transfers of Cost of Insurance (12,479) (20,768) (8,913) (3,721)
Transfers of Loan Processing Charges (2,605) (1,879) (581) (89)
Transfers Among Investment Divisions (44,067) 3,428 (138,211) 15,059
------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (379,236) (136,052) (258,694) 10,575
------------- -------------- ------------- --------------
Total Increase (Decrease) in Net Assets (323,680) (4,165) (163,706) 46,607
Net Assets - Beginning Balance 925,591 1,385,145 771,321 221,409
------------- -------------- ------------- --------------
Net Assets - Ending Balance $ 601,911 $1,380,980 $ 607,615 $ 268,016
============== ============== ============= ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
2000 2001 2002 2003 2004
Division Division Division Division Division
============= ============== ============= ============= ==============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ -- --
Risk Charges and Administrative Expenses (Note 3) (6,594) (5,903) (182) (7,050) (242)
Transaction Charges (Note 4) (3,948) (3,666) (101) (4,068) (154)
------------- -------------- ------------- ------------- --------------
Net Investment Income (10,542) (9,569) (283) (11,118) (396)
------------- -------------- ------------- ------------- --------------
Net Realized Gains (Losses) 95,254 123,075 2,371 16,061 7,026
Net Unrealized Gains (Losses) 105,966 83,458 3,879 275,061 3,822
------------- -------------- ------------- ------------- --------------
Net Realized and Unrealized Gains 201,220 206,533 6,250 291,122 10,848
------------- -------------- ------------- ------------- --------------
Net Increase in Net Assets
Resulting from Operations 190,678 196,964 5,967 280,004 10,452
------------- -------------- ------------- ------------- --------------
Transfers of Net Premiums 577 1,658 -- 10,836 122
Transfers of Policy Loading, Net (6,853) (5,699) (232) (5,399) (1,336)
Transfers Due to Deaths (262,111) -- -- -- --
Transfers Due to Other Terminations (933) (61,890) (1,372) (4,496) 48
Transfers Due to Policy Loans (16,644) 4,689 -- (1,252) --
Transfers of Cost of Insurance (16,097) (16,373) (411) (16,352) (3,561)
Transfers of Loan Processing Charges (1,212) (1,483) 1 (1,428) (1,690)
Transfers Among Investment Divisions 18,899 (14,788) (664) 6,524 (11,409)
-------------- -------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (284,374) (93,886) (2,678) (11,567) (17,826)
------------- -------------- ------------- ------------- --------------
Total Increase (Decrease) in Net Assets (93,696) 103,078 3,289 268,437 (7,374)
Net Assets - Beginning Balance 1,085,132 963,730 23,500 1,047,817 49,853
------------- -------------- ------------- ------------- --------------
Net Assets - Ending Balance $ 991,436 $1,066,808 $ 26,789 $1,316,254 $ 42,479
============= ============== ============= ============= ==============
<CAPTION>
2005 2006 2007
Division Division Division
============= ============== =============
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3 (3,597) ) (644) (1,980)
Transaction Charges (Note 4) (2,213) (410) (1,095)
------------- -------------- -------------
Net Investment Income (5,810) (1,054) (3,075)
------------- -------------- -------------
Net Realized Gains (Losses) 81,322 1,072 20,325
Net Unrealized Gains (Losses) 96,375 34,117 78,995
------------- -------------- -------------
Net Realized and Unrealized Gains 177,697 35,189 99,320
------------- -------------- -------------
Net Increase in Net Assets
Resulting from Operations 171,887 34,135 96,245
------------- -------------- -------------
Transfers of Net Premiums 2,830 1,172 4,853
Transfers of Policy Loading, Net (5,690) (538) (2,658)
Transfers Due to Deaths -- -- --
Transfers Due to Other Terminations (271,318) 93 (42,338)
Transfers Due to Policy Loans 55,216 -- --
Transfers of Cost of Insurance (11,457) (1,713) (7,493)
Transfers of Loan Processing Charges (925) (143) (1,923)
Transfers Among Investment Divisions 380,277 854 2,088
------------- -------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 148,933 (275) (47,471)
------------- -------------- -------------
Total Increase (Decrease) in Net Assets 320,820 33,860 48,774
Net Assets - Beginning Balance 729,307 103,483 313,059
------------- -------------- -------------
Net Assets - Ending Balance $1,050,127 $ 137,343 $ 361,833
============= ============== =============
The accompanying notes are an integral part of these financial statements.
</TABLE>
13
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
2008 2009 2010 2011 2013
Division Division Division Division Division
============= ============== ============= ============== =============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (4,784) (1,167) (1,114) (575) (172)
Transaction Charges (Note 4) (3,170) (645) (641) (307) (100)
-------------- ------------- ------------- -------------- -------------
Net Investment Income (7,954) (1,812) (1,755) (882) (272)
-------------- ------------- ------------- -------------- -------------
Net Realized Gains (Losses) 86,673 38,209 48,554 1,915 2,053
Net Unrealized Gains (Losses) 213,611 25,291 16,877 31,623 9,915
-------------- ------------- ------------- -------------- -------------
Net Realized and Unrealized Gains 300,284 63,500 65,431 33,538 11,968
-------------- ------------- ------------- -------------- -------------
Net Increase in Net Assets
Resulting from Operations 292,330 61,688 63,676 32,656 11,696
-------------- ------------- ------------- -------------- -------------
Transfers of Net Premiums 7,477 5,147 596 -- --
Transfers of Policy Loading, Net (2,095) (5,296) 5,297 (376) (272)
Transfers Due to Deaths -- -- -- -- --
Transfers Due to Other Terminations (29,801) (13,614) (38,065) 19 85
Transfers Due to Policy Loans (79,679) 58 964 -- --
Transfers of Cost of Insurance (26,281) (5,745) (1,245) (1,145) (96)
Transfers of Loan Processing Charges (3,706) (1,832) (99) (1) (40)
Transfers Among Investment Divisions (14,585) (6,819) (90,277) (5,745) (15,552)
-------------- ------------- ------------- -------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (148,670) (28,101) (122,829) (7,248) (15,875)
-------------- ------------- ------------- -------------- -------------
Total Increase (Decrease) in Net Assets 143,660 33,587 (59,153) 25,408 (4,179)
Net Assets - Beginning Balance 859,630 169,855 234,380 79,085 37,594
-------------- ------------- ------------- -------------- -------------
Net Assets - Ending Balance $1,003,290 $ 203,442 $ 175,227 $ 104,493 $ 33,415
============== ============= ============= ============== =============
<CAPTION>
2014
Division
=============
<S> <C>
Investment Income:
Dividends (Note 2) $ --
Risk Charges and Administrative Expenses (Note 3) (4,017)
Transaction Charges (Note 4) (2,306)
-------------
Net Investment Income (6,323)
-------------
Net Realized Gains (Losses) 193,176
Net Unrealized Gains (Losses) 90,802
-------------
Net Realized and Unrealized Gains 283,978
-------------
Net Increase in Net Assets
Resulting from Operations 277,655
-------------
Transfers of Net Premiums 5,218
Transfers of Policy Loading, Net 7,288
Transfers Due to Deaths --
Transfers Due to Other Terminations (19,835)
Transfers Due to Policy Loans (40,770)
Transfers of Cost of Insurance (23,436)
Transfers of Loan Processing Charges (4,007)
Transfers Among Investment Divisions 921,357
-------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 845,815
-------------
Total Increase (Decrease) in Net Assets 1,123,470
Net Assets - Beginning Balance 152,183
-------------
Net Assets - Ending Balance $1,275,653
=============
The accompanying notes are an integral part of these financial statements.
</TABLE>
14
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
Intermediate Long-Term
Money Government Corporate
Reserve Bond Bond
Total Division Division Division
=================== ================= ================ ================
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $25,996,668 $ 2,038,461 $ 1,544,282 $ 1,191,230
Risk Charges and Administrative Expenses (Note 3) (1,805,685) (445,941) (97,899) (76,277)
Transaction Charges (Note 4) (46,666) -- -- --
------------------- ----------------- ---------------- ----------------
Net Investment Income (Loss) 24,144,317 1,592,520 1,446,383 1,114,953
------------------- ----------------- ---------------- ----------------
Net Realized Gains (Losses) 2,602,180 -- (177,834) (211,500)
Net Unrealized Gains (Losses) (35,959,961) -- (2,150,352) (1,582,492)
------------------- ----------------- ---------------- ----------------
Net Realized and Unrealized Gains (Losses) (33,357,781) -- (2,328,186) (1,793,992)
------------------- ----------------- ---------------- ----------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (9,213,464) 1,592,520 (881,803) (679,039)
------------------- ----------------- ---------------- ----------------
Transfers of Net Premiums 10,286,389 2,105,076 595,882 717,976
Transfers of Policy Loading, Net (1,949,708) (647,197) (85,864) (62,953)
Transfers Due to Deaths (1,079,467) 188,317 (189,094) (113,385)
Transfers Due to Other Terminations (41,501,886) (11,512,781) (1,787,286) (2,060,010)
Transfers Due to Policy Loans (8,424,647) (2,713,350) (374,708) (410,329)
Transfers of Cost of Insurance (6,692,074) (1,444,557) (373,425) (417,776)
Transfers of Loan Processing Charges (113,254) (28,459) (5,648) (6,978)
Transfers Among Investment Divisions -- 11,110,047 (2,038,610) (584,158)
------------------- ----------------- ---------------- ----------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (49,474,647) (2,942,904) (4,258,753) (2,937,613)
------------------- ----------------- ---------------- ----------------
Total Increase (Decrease) in Net Assets (58,688,111) (1,350,384) (5,140,556) (3,616,652)
Net Assets - Beginning Balance 267,003,494 44,474,751 16,741,437 12,396,056
------------------- ----------------- ---------------- ----------------
Net Assets - Ending Balance $ 208,315,383 $ 43,124,367 $ 11,600,881 $ 8,779,404
=================== ================= ================ ================
<CAPTION>
Capital Growth Multiple High
Stock Stock Strategy Yield
Division Division Division Division
================ =============== =================== =================
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 3,142,899 $ 3,093,238 $ 13,388,248 $ 795,450
Risk Charges and Administrative Expenses (Note 3) (176,499) (112,823) (606,543) (57,005)
Transaction Charges (Note 4) -- -- -- --
---------------- --------------- ------------------- -----------------
Net Investment Income (Loss) 2,966,400 2,980,415 12,781,705 738,445
---------------- --------------- ------------------- -----------------
Net Realized Gains (Losses) 208,644 (2,584,380) 2,550,408 10,390
Net Unrealized Gains (Losses) (4,842,483) (1,882,402) (20,570,153) (391,761)
---------------- --------------- ------------------- -----------------
Net Realized and Unrealized Gains (Losses) (4,633,839) (4,466,782) (18,019,745) (381,371)
---------------- --------------- ------------------- -----------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (1,667,439) (1,486,367) (5,238,040) 357,074
---------------- --------------- ------------------- -----------------
Transfers of Net Premiums 1,445,062 804,922 3,681,144 110,037
Transfers of Policy Loading, Net (167,633) (100,545) (554,156) (52,361)
Transfers Due to Deaths (153,228) (111,062) (527,570) (12,948)
Transfers Due to Other Terminations (3,966,493) (2,024,930) (13,654,052) (595,600)
Transfers Due to Policy Loans (556,554) (214,557) (2,991,108) (198,064)
Transfers of Cost of Insurance (739,746) (421,693) (2,516,739) (118,329)
Transfers of Loan Processing Charges (11,158) (10,236) (31,615) (4,116)
Transfers Among Investment Divisions (702,846) (1,837,221) (1,795,752) (2,062,458)
---------------- --------------- ------------------- -----------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (4,852,596) (3,915,322) (18,389,848) (2,933,839)
---------------- --------------- ------------------- -----------------
Total Increase (Decrease) in Net Assets (6,520,035) (5,401,689) (23,627,888) (2,576,765)
Net Assets - Beginning Balance 27,682,683 19,202,743 96,199,409 14,631,496
---------------- --------------- ------------------- -----------------
Net Assets - Ending Balance $ 21,162,648 $ 13,801,054 $ 72,571,521 $ 12,054,731
================ =============== =================== =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
Natural Global
Resources Strategy Balanced 1994
Division Division Division Division
============== ============= ============= ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ 30,546 $ 499,770 $ 272,544 $ --
Risk Charges and Administrative Expenses (Note 3) (10,553) (89,027) (35,488) (11,313)
Transaction Charges (Note 4) -- -- -- (5,952)
-------------- ------------- ------------- --------------
Net Investment Income (Loss) 19,993 410,743 237,056 (17,265)
-------------- ------------- ------------- --------------
Net Realized Gains (Losses) (34,704) 650,378 133,302 737,888
Net Unrealized Gains (Losses) 5,696 (1,333,212) (637,932) (677,612)
-------------- ------------- ------------- --------------
Net Realized and Unrealized Gains (Losses) (29,008) (682,834) (504,630) 60,276
-------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (9,015) (272,091) (267,574) 43,011
-------------- ------------- ------------- --------------
Transfers of Net Premiums 45,732 408,394 263,760 6,489
Transfers of Policy Loading, Net (13,452) (104,953) (62,126) (14,008)
Transfers Due to Deaths (11,577) (22,195) (68,291) --
Transfers Due to Other Terminations (231,264) (2,117,745) (1,412,845) (49,981)
Transfers Due to Policy Loans (67,859) (493,831) (147,174) (964)
Transfers of Cost of Insurance (30,032) (239,462) (137,339) (23,527)
Transfers of Loan Processing Charges (1,175) (6,030) (1,447) (460)
Transfers Among Investment Divisions 130,897 (361,205) (200,288) (2,798,545)
-------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (178,730) (2,937,027) (1,765,750) (2,880,996)
-------------- ------------- ------------- --------------
Total Increase (Decrease) in Net Assets (187,745) (3,209,118) (2,033,324) (2,837,985)
Net Assets - Beginning Balance 1,395,286 12,378,447 5,609,731 2,837,985
-------------- ------------- ------------- --------------
Net Assets - Ending Balance $1,207,541 $9,169,329 $3,576,407 $ 0
============== ============= ============= ==============
<CAPTION>
1995 1996 1997 1998
Division Division Division Division
============= ============== ============= ==============
<S> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (17,838) (7,412) (10,614) (5,066)
Transaction Charges (Note 4) (8,838) (3,274) (5,122) (2,816)
------------- -------------- ------------- --------------
Net Investment Income (Loss) (26,676) (10,686) (15,736) (7,882)
------------- -------------- ------------- --------------
Net Realized Gains (Losses) 501,434 70,547 282,853 83,398
Net Unrealized Gains (Losses) (456,096) (60,955) (305,703) (112,421)
------------- -------------- ------------- --------------
Net Realized and Unrealized Gains (Losses) 45,338 9,592 (22,850) (29,023)
------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 18,662 (1,094) (38,586) (36,905)
------------- -------------- ------------- --------------
Transfers of Net Premiums 12,284 3,206 19,020 1,427
Transfers of Policy Loading, Net (19,384) (11,563) (18,743) (2,856)
Transfers Due to Deaths (758) (322) (482) (47,511)
Transfers Due to Other Terminations (601,606) (231,579) (640,424) (85,418)
Transfers Due to Policy Loans (168,335) 8,226 (43,306) 2,136
Transfers of Cost of Insurance (50,462) (15,410) (23,900) (13,237)
Transfers of Loan Processing Charges (1,589) (950) (506) (131)
Transfers Among Investment Divisions 82,301 156,738 263,312 52,833
------------- -------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (747,549) (91,654) (445,029) (92,757)
------------- -------------- ------------- --------------
Total Increase (Decrease) in Net Assets (728,887) (92,748) (483,615) (129,662)
Net Assets - Beginning Balance 2,844,313 1,018,339 1,868,760 900,983
------------- -------------- ------------- --------------
Net Assets - Ending Balance $2,115,426 $ 925,591 $1,385,145 $ 771,321
============= ============== ============= ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
16
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
1999 2000 2001 2002 2003
Division Division Division Division Division
============= ============== ============= ============= ==============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (1,394) (6,794) (6,834) (150) (7,713)
Transaction Charges (Note 4) (841) (3,295) (3,547) (82) (3,591)
------------- -------------- ------------- ------------- --------------
Net Investment Income (Loss) (2,235) (10,089) (10,381) (232) (11,304)
------------- -------------- ------------- ------------- --------------
Net Realized Gains (Losses) 23,507 33,346 94,772 282 34,499
Net Unrealized Gains (Losses) (33,751) (92,171) (172,080) (2,301) (129,920)
------------- -------------- ------------- ------------- --------------
Net Realized and Unrealized Gains (Losses) (10,244) (58,825) (77,308) (2,019) (95,421)
------------- -------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (12,479) (68,914) (87,689) (2,251) (106,725)
------------- -------------- ------------- ------------- --------------
Transfers of Net Premiums 950 989 6,604 576 12,306
Transfers of Policy Loading, Net (1,153) (5,475) (6,279) (126) (6,122)
Transfers Due to Deaths (7,325) (378) (336) (8) (365)
Transfers Due to Other Terminations 25 201 (112,058) 1 (44,914)
Transfers Due to Policy Loans 295 21,349 (19,794) -- (25,550)
Transfers of Cost of Insurance (3,479) (13,189) (21,350) (487) (16,570)
Transfers of Loan Processing Charges (26) (73) (533) (1) (107)
Transfers Among Investment Divisions (86,671) 268,010 19,510 (1,913) 86,674
------------- -------------- ------------- ------------- --------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (97,384) 271,434 (134,236) (1,958) 5,352
------------- -------------- ------------- ------------- --------------
Total Increase (Decrease) in Net Assets (109,863) 202,520 (221,925) (4,209) (101,373)
Net Assets - Beginning Balance 331,272 882,612 1,185,655 27,709 1,149,190
------------- -------------- ------------- ------------- --------------
Net Assets - Ending Balance $ 221,409 $1,085,132 $ 963,730 $ 23,500 $1,047,817
============= ============== ============= ============= ==============
<CAPTION>
2004 2005 2006
Division Division Division
============= ============== =============
<S> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (285) (4,350) (701)
Transaction Charges (Note 4) (76) (2,271) (382)
------------- -------------- -------------
Net Investment Income (Loss) (361) (6,621) (1,083)
------------- -------------- -------------
Net Realized Gains (Losses) (14) 12,064 5,861
Net Unrealized Gains (Losses) (682) (73,754) (18,694)
------------- -------------- -------------
Net Realized and Unrealized Gains (Losses) (696) (61,690) (12,833)
------------- -------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (1,057) (68,311) (13,916)
------------- -------------- -------------
Transfers of Net Premiums -- 5,091 1,172
Transfers of Policy Loading, Net (310) (3,200) (684)
Transfers Due to Deaths (17) (254) (36)
Transfers Due to Other Terminations 9 (14,921) (6,758)
Transfers Due to Policy Loans 248 (5,950) (9,949)
Transfers of Cost of Insurance (1,428) (12,551) (1,723)
Transfers of Loan Processing Charges (64) (141) (5)
Transfers Among Investment Divisions 52,472 113,825 (3,687)
------------- -------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 50,910 81,899 (21,670)
------------- -------------- -------------
Total Increase (Decrease) in Net Assets 49,853 13,588 (35,586)
Net Assets - Beginning Balance -- 715,719 139,069
------------- -------------- -------------
Net Assets - Ending Balance $ 49,853 $ 729,307 $ 103,483
============= ============== =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
17
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994 (Continued)
================================================================================
<TABLE>
<CAPTION>
2007 2008 2009 2010 2011
Division Division Division Division Division
============== ============= ============== ============= =============
<S> <C> <C> <C> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ -- $ -- $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (3,662) (8,086) (3,476) (1,113) (535)
Transaction Charges (Note 4) (1,148) (3,398) (1,013) (560) (292)
-------------- ------------- -------------- ------------- -------------
Net Investment Income (Loss) (4,810) (11,484) (4,489) (1,673) (827)
-------------- ------------- -------------- ------------- -------------
Net Realized Gains (Losses) 17,744 114,790 36,594 7,576 4,943
Net Unrealized Gains (Losses) (59,883) (237,968) (104,889) (26,744) (16,374)
-------------- ------------- -------------- ------------- -------------
Net Realized and Unrealized Gains (Losses) (42,139) (123,178) (68,295) (19,168) (11,431)
-------------- ------------- -------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (46,949) (134,662) (72,784) (20,841) (12,258)
-------------- ------------- -------------- ------------- -------------
Transfers of Net Premiums 6,495 19,407 7,971 596 3,821
Transfers of Policy Loading, Net (1,851) (2,027) (2,746) (1,049) (463)
Transfers Due to Deaths (109) (299) (59) (82) (27)
Transfers Due to Other Terminations (1,593) (61,711) (283,275) 43 (5,319)
Transfers Due to Policy Loans (1,035) (10,182) 51 (4,353) --
Transfers of Cost of Insurance (9,626) (34,455) (8,422) (1,306) (1,661)
Transfers of Loan Processing Charges (387) (1,387) (8) (11) (4)
Transfers Among Investment Divisions (15,508) (81,540) (10,478) 79,893 (22,278)
-------------- ------------- -------------- ------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions (23,614) (172,194) (296,966) 73,731 (25,931)
-------------- ------------- -------------- ------------- -------------
Total Increase (Decrease) in Net Assets (70,563) (306,856) (369,750) 52,890 (38,189)
Net Assets - Beginning Balance 383,622 1,166,486 539,605 181,490 117,274
-------------- ------------- -------------- ------------- -------------
Net Assets - Ending Balance $ 313,059 $ 859,630 $ 169,855 $ 234,380 $ 79,085
============== ============= ============== ============= =============
<CAPTION>
2013 2014
Division Division
============== =============
<S> <C> <C>
Investment Income:
Dividends (Note 2) $ -- $ --
Risk Charges and Administrative Expenses (Note 3) (151) (143)
Transaction Charges (Note 4) (85) (83)
-------------- -------------
Net Investment Income (Loss) (236) (226)
-------------- -------------
Net Realized Gains (Losses) (5,309) 701
Net Unrealized Gains (Losses) 2,041 5,087
-------------- -------------
Net Realized and Unrealized Gains (Losses) (3,268) 5,788
-------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (3,504) 5,562
-------------- -------------
Transfers of Net Premiums -- --
Transfers of Policy Loading, Net (252) (177)
Transfers Due to Deaths (13) (53)
Transfers Due to Other Terminations 7 391
Transfers Due to Policy Loans -- --
Transfers of Cost of Insurance (148) (45)
Transfers of Loan Processing Charges (2) (7)
Transfers Among Investment Divisions 40,134 146,512
-------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Principal Transactions 39,726 146,621
-------------- -------------
Total Increase (Decrease) in Net Assets 36,222 152,183
Net Assets - Beginning Balance 1,372 --
-------------- -------------
Net Assets - Ending Balance $ 37,594 $ 152,183
============== =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
18
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
================================================================================
NOTE 1-ORGANIZATION
Variable Account A of Monarch Life Insurance Company (the Account) is a
segregated account of Monarch Life Insurance Company (Monarch Life) and is
registered as a unit investment trust under the Investment Company Act of 1940,
as amended (1940 Act), and is currently comprised of twenty-seven investment
divisions. Ten of the divisions each invest solely in the shares of the ten
corresponding portfolios of the Merrill Lynch Series Fund, Inc. (Series Fund), a
no-load, open-end, diversified, series management investment company registered
under the 1940 Act. The Series Fund's investment advisor is Merrill Lynch Asset
Management, L.P. Seventeen of the divisions each invest solely in the units of
the seventeen corresponding series trusts of The Merrill Lynch Fund of Stripped
(AZero@) U.S. Treasury Securities, Series A through K (the Trusts), which is
registered under the 1940 Act as a unit investment trust. The sponsor of the
Trusts is Merrill Lynch, Pierce, Fenner & Smith Inc. Under applicable insurance
law, the assets and liabilities of the Account are clearly identified and
distinguished from the other assets and liabilities of Monarch Life. The portion
of the Account's assets applicable to the variable life insurance policies is
not chargeable with liabilities arising out of any other business Monarch Life
may conduct.
The change in net assets maintained in the Account provides the basis for the
periodic determination of the amount of increased or decreased benefits under
the policies. The net assets may not be less than the amount required under
state insurance law to provide for death benefits (without regard to the minimum
death benefit guarantee) and other policy benefits. Additional assets are held
in Monarch Life's general account to cover the contingency that the guaranteed
minimum death benefit might exceed the death benefit which would have been
payable in the absence of such guarantee.
Monarch Life is a wholly-owned subsidiary of Regal Reinsurance Company (Regal
Re). On June 9, 1994, the Insurance Commissioner of the Commonwealth of
Massachusetts (the Commissioner) was appointed receiver (the Receiver) of
Monarch Life in a rehabilitation proceeding pending before the Supreme Judicial
Court for Suffolk County, Massachusetts (the Court). A term sheet dated July 19,
1994 (the Term Sheet) among the Commissioner (in her capacity as Commissioner
and Receiver) and certain of Regal Re shareholders and noteholders and holders
of Monarch Life's surplus notes (representing approximately 85% of both the
total outstanding Regal Re notes and common stock) (the Holders) was approved by
the Court on September 1, 1994. Pursuant to the Term Sheet, the Holders
transferred their notes and stock into voting trusts for which the Commissioner
is the sole trustee, which effectively vests control of Monarch Life and Regal
Re in the Commissioner.
On January 31, 1997, the Receiver, with Court approval, appointed a Special
Deputy Receiver for Monarch Life. The Special Deputy Receiver is responsible for
the management of Monarch Life=s operations and reports to the Receiver as has
been the case with Monarch Life=s President, who recently announced plans to
retire at the end of the first quarter of 1997. The Receiver=s active
involvement in the rehabilitation of Monarch Life will not change.
Insurance departments of various jurisdictions have either suspended Monarch
Life's certificate of authority, ordered Monarch Life to cease writing new
business, or have requested a voluntary suspension of sales. In addition,
Monarch Life's certificate of authority has been revoked by the insurance
departments of the states of Louisiana (1994), Michigan (1995), Missouri (1994),
and Wyoming (1992).
Monarch Life currently limits its business to maintaining its existing
disability income insurance, variable life, and annuity business. Monarch Life
ceased issuing new variable life insurance policies and new annuity contracts
effective May 1, 1992, and new disability income insurance policies effective
June 15, 1993.
The assets of the Account are not available to meet the general obligations of
Monarch Life or Regal Re and are held for the exclusive benefit of the
policyholders participating in the Account.
19
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
================================================================================
NOTE 2-SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Account in preparation of its financial statements. Preparation
of financial statements requires the use of estimates made by management. Actual
results may differ from these estimates. The policies are in conformity with
generally accepted accounting principles.
INVESTMENTS: The investments in shares of the Series Fund and units of
the Trusts are stated at the net asset value per share and per unit of
the respective portfolios and series trusts of the Series Fund and the
Trusts. Investment transactions are accounted for on the date the
shares and units are purchased or sold. The cost of shares and units
sold and redeemed is determined on the first-in, first-out method.
Dividend and capital gain distributions received from the Series Fund
and the Trusts are reinvested in additional shares and units of the
Series Fund and the Trusts and are recorded as income by the Account on
the ex-dividend date. Capital gains distributions are included in
dividend income in the statements of operations and changes in net
assets.
FEDERAL INCOME TAXES: For federal income tax purposes, operations of
the Account are combined with those of Monarch Life which is taxed as a
life insurance company. Under existing federal income tax law,
investment income (dividends) and capital gains attributable to the
Account are not taxed.
NOTE 3 - EXPENSES
Monarch Life assumes mortality and expense risks related to the operations of
the Account and deducts a daily charge from the assets of the Account to cover
these risks. The daily charge varies by policy form and is currently equal to a
rate of .50% to .90% (on an annual basis) of the policyholders' investment base.
Monarch Life makes certain deductions from the annual or single premium before
such amounts are transferred to the Account. The deductions are for (1) premiums
for optional benefits, (2) additional premiums for extra mortality risks, (3)
sales load, and (4) state premium taxes.
For certain single premium policies, the sum of deductions (3) and (4) is
included in the investment base of a policyholder in the Account on the policy
issue date. Thereafter, this allocated policy loading is subtracted from that
policyholder's investment base in equal installments at the beginning of the
second through eleventh policy years.
NOTE 4-TRANSACTION CHARGES
Monarch Life pays all transaction charges to Merrill Lynch, Pierce, Fenner &
Smith Inc., on the sale of units of the Trusts to the Account and deducts a
daily asset charge against the assets of each series trust division in the
Account for the reimbursement of these transaction charges. The daily charge is
currently equal to a rate of .34% (on annual basis) of the policyholders'
investment base.
NOTE 5-PRINCIPAL UNDERWRITING AND GENERAL DISTRIBUTOR
Since June 13, 1995, Baystate Capital Services, Inc. (BCSI), has been the
principal underwriter and general distributor of the contracts maintained in the
Account. BCSI is a wholly-owned subsidiary of Monarch Life. Prior to June 13,
1995, the function of principal underwriter and general distributor was
performed by First Variable Capital Services, Inc., a wholly-owned subsidiary of
First Variable Life Insurance Company (FVL). Prior to September 22, 1994, FVL
was a wholly-owned subsidiary of Monarch Life. Effective September 22, 1994, FVL
is no longer an affiliate of Monarch Life.
20
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
================================================================================
NOTE 6-AMOUNTS RETAINED
The amount retained by Monarch Life in the Account includes unamortized
allocated policy loading (see Note 3), in part and may be transferred in future
periods by Monarch Life to its general account. The total unamortized allocated
policy loading ($745,587 at December 31, 1996 and $1,571,802 at December 31,
1995) is in excess of the amount retained by Monarch Life because of amounts
provided for future policy benefits ($347,626 at December 31, 1996 and $404,427
at December 31, 1995) which are included in the net assets for variable life
policies at December 31, 1996 and December 31, 1995.
NOTE 7-PURCHASES AND SALES OF SECURITIES
Total cost of purchases and proceeds from sales of shares of the Series Fund and
units of the Trusts by the Account during the year ended December 31, 1996, are
shown below:
<TABLE>
<CAPTION>
Purchases Sales
--------- -----
<S> <C> <C>
Money Reserve Portfolio $ 44,768,300 $ 49,021,594
Intermediate Government Bond Portfolio 1,166,830 2,214,189
Long-Term Corporate Bond Portfolio 840,296 1,529,880
Capital Stock Portfolio 8,386,201 6,728,197
Growth Stock Portfolio 9,270,805 9,621,752
Multiple Strategy Portfolio 10,792,520 9,578,177
High Yield Bond Portfolio 34,227,267 32,675,889
Natural Resources Portfolio 1,913,332 1,474,948
Global Strategy Portfolio 3,028,594 3,162,612
Balanced Portfolio 1,004,960 1,193,475
1996 Trust 148 605,411
1997 Trust 27,400 243,415
1998 Trust 24,377 67,366
1999 Trust 539 95,962
2000 Trust 33,495 187,089
2001 Trust 100,751 214,045
2002 Trust -- 607
2003 Trust 111,468 202,026
2004 Trust 96 6,973
2005 Trust 28,090 176,881
2006 Trust 66,868 18,185
2007 Trust 2,662 12,200
2008 Trust 4,116 142,064
2009 Trust 196,887 192,264
2010 Trust 80,118 69,362
2011 Trust 1,796 72,062
2013 Trust 79,861 79,687
2014 Trust 2,960,419 2,741,498
----------------- ------------------
Totals $ 119,118,196 $ 122,327,810
================= =================
</TABLE>
21
<PAGE>
VARIABLE ACCOUNT A
OF MONARCH LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
================================================================================
NOTE 8-DIVERSIFICATION REQUIREMENTS
Under the provisions of Section 817(h) of the Internal Revenue Code (the Code),
a variable life insurance policy, other than a policy issued in connection with
certain types of employee benefit plans, will not be treated as a life insurance
policy for federal tax purposes for any period for which the investments of the
segregated asset account, on which the policy is based, are not adequately
diversified. The Code provides that the "adequately diversified" requirement may
be met if the underlying investments satisfy either a statutory safe harbor test
or diversification requirements set forth in regulations issued by the Secretary
of the Treasury.
The Internal Revenue Service has issued regulations under Section 817(h) of the
Code. Monarch Life believes, based on assurances from the Series Fund and the
Trusts, that the Account satisfies the current requirements of the regulations.
22
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