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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 59 (File No. 2-29081) X
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940
Amendment No. 20 (File No. 811-1653) X
IDS Life Variable Annuity Fund A (Individual and Employer)
IDS Tower 10, Minneapolis, Minnesota 55440-0010
(612) 671-3678
Mary Ellyn Minenko - IDS Tower 10, Minneapolis 55440-0010
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b)
X on April 30, 1996 pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)
on (date) pursuant to paragraph (a) of rule 485
The Registrant has registered an indefinite number or amount of
securities under the Securities Act of 1933 pursuant to section
24-F of the Investment Company Act of 1940. Registrant's Rule
24f-2 Notice for its most recent fiscal year was filed on February
20, 1996.
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IDS Life Variable Annuity Fund A Post-Effective
(Individual and Employer) Amendment No. 59
Registration Form N-1
Cross reference sheet showing location in the prospectus of the
information called for by the items enumerated in Part I of Form
N-1.
Negative answers omitted from prospectus are so indicated.
IDS LIFE VARIABLE ANNUITY FUND A (INDIVIDUAL AND EMPLOYER)
Section
Item No. In Prospectus
1 Cover
2 Summary of Contents
3 Financial Highlights
4(a) History
(b) Not Applicable
(c) Not Applicable
5(a) Investment Objective
(b) Investments the Fund will not make
(c) Investment objective
(d) Financial Highlights; Investment objective
6(a) Tax charges
(b) Tax charges; What about your taxes?
(c) Not Applicable
(d) Not Applicable
7(a) Brokerage
(b) Brokerage
(c) Brokerage
(d) Not Applicable
8 Not Applicable
9(a) Ownership of IDS Life and American Express
Financial Corporation
(b) Not Applicable
(c) Members of the Board of Managers and Officers of
the Fund
10 Members of the Board of Managers and Officers of
the Fund
11 Not Applicable
12(a) Custodian
(b) Not Applicable
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13(a) Investment agreements; Brokerage; Ownership of
IDS Life and American Express Financial
Corporation
(b) Not Applicable
(c) Not Applicable
(d) Not Applicable
14(a) Voting rights
(b) Not Applicable
15(a) Measuring the value of your contract; Dates we
revalue-Valuation date; The Valuation period;
Valuing Fund assets; The charges you pay
(b) Automated transfers and partial surrenders;
Valuing an annuity unit; Annuity payment starting
date; Table of settlement rates; Annuity payment
plans; Determination of monthly annuity payments
for deferred contracts; Determination of monthly
annuity payments for immediate contracts;
Surrendering your contract; Making withdrawals on
your contract; Special rules if the annuitant
dies before the annuity payment starting date;
Your right to cancel installment contracts
(c) Not Applicable
16(a) Investment agreements; Brokerage; Cover; Annuity
payment plans; The charges you pay; Making
withdrawals on your contract
(b) Directors and officers of IDS Life Insurance
Company; Other affiliations
(c) The charges you pay
(d) Not Applicable
17 Not Applicable
18 Financial statements; IDS Life Financial
Information
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IDS Life Variable Annuity Fund A
Individual Variable Annuity Contracts and Variable Annuity
Contracts for Employer Plans
Prospectus/April 30, 1996
IDS Life Variable Annuity Fund A (the Fund) is a segregated asset
account of IDS Life Insurance Company (IDS Life). The investment
objective of the Fund is long-term capital appreciation. The Fund
invests primarily in common stocks of U.S. corporations. The Fund
also may invest in preferred stocks and in corporate and government
bonds.
This prospectus describes the following types of individual
non-tax-qualified, variable annuity contracts offered by IDS Life:
1) an annuity for use in connection with non-qualified retirement
or deferred compensation plans or programs adopted by an employer
that are not intended to qualify under Sections 401, 403, or 408 of
the Internal Revenue Code (the Code); 2) an installment payment
deferred annuity; 3) a single payment deferred annuity; and 4) a
single payment immediate annuity.
New contracts are not currently being offered. This prospectus
gives you facts about the Fund. You should read it and keep it
with your investment records for future reference.
The Fund is responsible only for statements included in this
prospectus or in authorized sales material.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
IDS Life Variable Annuity Fund A
IDS Tower 10
Minneapolis, Minnesota 55440-0010
General Information (612) 671-3733
Annuity Service (612) 671-4738
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IDS Life Variable Annuity Fund A
IDS Life Insurance Company
IDS Tower 10
Minneapolis, Minnesota 55440-0010
Prospectus, April 30, 1996
Individual Variable Annuity Contracts and Variable Annuity
Contracts For Employer Plans
Table of Contents Page
Summary of Contents...........................................
Financial Highlights..........................................
The variable annuity..........................................
Investment objective..........................................
Investments the Fund will not make............................
Portfolio manager.............................................
Investment agreements.........................................
Brokerage.....................................................
The contracts.................................................
The fixed account.............................................
Automated transfers and partial surrenders....................
Measuring the value of your contract..........................
Valuing Fund assets...........................................
When we credit your purchase payments.........................
The investment factor.........................................
Valuing an accumulation unit..................................
Valuing an annuity unit.......................................
Annuity payment starting date.................................
Table of settlement rates.....................................
Annuity payment plans.........................................
The charges you pay...........................................
Surrendering your contract....................................
Making withdrawals on your contract...........................
Special rules if annuitant dies before
the annuity payment starting date.............................
Your right to cancel installment contracts....................
What about your taxes?........................................
Voting rights.................................................
Management....................................................
Directors and officers of IDS Life Insurance Company..........
Other Information.............................................
Insurance regulation..........................................
Financial statements..........................................
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Summary of Contents
About the variable annuity - The variable annuities are offered for
sale through the Fund, a diversified open-end management investment
company. Variable annuity contracts guarantee regular payments to
contract purchasers. The amount of these payments is influenced by
the performance of the securities in which the Fund invests (page
__).
Financial Highlights - This table shows important financial
information you will need to evaluate the Fund's performance (page
__).
Investment objective - The Fund's investment objective is long-term
capital appreciation in order to build up values and to make
annuity payments. The Fund invests primarily in common stock and
also may invest in preferred stock and in government and corporate
bonds. The Fund may invest in foreign securities, futures
contracts and options. There can be no guarantee the Fund will
achieve its investment objective because any investment involves
risk (page __).
Portfolio manager - The Fund is managed by senior portfolio manager
Mitzi Malevich (page __).
Investment agreements - The Fund is a segregated asset account of
IDS Life Insurance Company, a stock life insurance company. The
investments of the Fund are managed by IDS Life pursuant to an
Investment Management Agreement. Under this agreement, IDS Life
receives a management fee equal to 0.4% of the Fund's average daily
net assets for each year. Pursuant to a Distribution and Services
Agreement, IDS Life also serves as principal underwriter of the
Fund. IDS Life annually pays 0.25% of the Fund's net assets to
American Express Financial Corporation for investment advice
regarding management of the Fund's investments (page __).
Contracts - This prospectus describes the following types of
individual non-tax-qualified variable annuity contracts:
o An individual variable annuity contract for use in connection
with non-qualified retirement or deferred compensation plans
or programs adopted by an employer. These plans or programs
are not intended to qualify under Sections 401, 403, or 408
of the Code. Under this contract, you make an annual
purchase payment. This payment must be at least equal to the
larger of an amount which, when multiplied by the number of
contract years between the application date and the
retirement date, equals (1) $3,000 or (2) $300 a year. This
contract also provides several optional settlement plans
which may be elected, except that if at the annuity payment
starting date the accumulation value of the contract is less
than $2,000, the accumulation value may be paid in a lump sum
(page __);
o A single payment deferred annuity that can be purchased by
making an initial payment of at least $3,000 (page __);
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PAGE 7
o A single payment immediate annuity that can be purchased by
making an initial payment of at least $3,000 (page __); and
o An installment payment deferred annuity that may be purchased
by making 10 or more annual payments that total at least $300
(page __).
Who owns the contract? - The annuitant is the owner, unless your
application says otherwise, or if ownership of the contract is
later transferred to someone else. Transfers go into effect when
recorded by IDS Life at its corporate office (page __).
If the contract described in this prospectus is purchased by an
employer in connection with a deferred compensation plan, the
employer becomes the exclusive owner of all rights under the
contract. Any employee referred to in the contract as an annuitant
is called an annuitant solely for purposes of identification. All
funds payable under the contract are paid to and are the exclusive
property of the employer. No certificates are issued by IDS Life
to any employee with whom an employer has entered into a deferred
compensation agreement. Any employee participating in a deferred
compensation plan should refer to the deferred compensation
agreement with his employer for information on any additional
charges in connection with the plan.
Transfers between accounts - Before the annuity payment starting
date, you may give IDS Life written or telephone instructions to
transfer the contract value of your investment between the fixed
account and the variable account. Transfers must be at least for
$50 (page __).
Charges you pay - IDS Life will deduct a combined sales and
administrative charge from payments you make into the Fund.
For the individual variable annuity contract intended for use with
non-qualified plans adopted by an employer, the deduction is 5.75%
of the first $10,000 paid into the Fund, 4% of the next $40,000 and
2% of all amounts in excess of $50,000 (page __).
For the other three individual annuity contracts, if you make a
single payment, the deduction is 8% of the first $15,000, 5% of the
next $10,000 and 2% of any further amounts. If you choose to make
installment payments, the deductions average 8.7% over the first 10
years. You may lose money if you surrender your individual
installment contract too soon because the percentage that is
deducted is higher in the earlier years (20% for the first year of
an installment payment contract, 18% for the second and third
contract years, 7% for the fourth year and 4% thereafter)
(page __).
Additionally, IDS Life may deduct for premium taxes. Most states
don't have premium taxes but in those that do, IDS Life may make a
deduction. State premium taxes range from 0 to 3.5% of the gross
purchase payments. You may receive some money in excess of the
amount requested if, as a result of your surrender, the Fund's
state premium tax liability is reduced (page __).
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Surrendering your contract - You can surrender all or part of a
deferred annuity contract any time before the annuity payment
starting date by giving IDS Life written or telephone instructions.
IDS Life will cash in the number of accumulation units or fixed
dollar accumulation value required for the amount of money you
request. The accumulation units will be given the accumulation
unit value determined on the date your request is received.
However, you can't surrender part of your contract if the remaining
accumulation value is less than $20. There can be no surrenders of
any type after annuity payments have started. You will pay income
tax on the taxable part of your surrender and you may have to pay
an IRS penalty tax on early withdrawal if you surrender part or all
of your contract before reaching age 59-1/2.
A surrender may result in adverse tax consequences. You should
consult a tax advisor before making a surrender request (page __).
Additional Information
For information about the Fund's history, organization and
headquarters as well as information about IDS Life and American
Express Financial Corporation (see page __).
<TABLE><CAPTION>
Financial Highlights From Jan 1, 1986 to Dec. 31, 1995
Years ended Dec. 31, 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
__________________________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Accumulation unit value at
beginning of year $10.27 $10.70 $ 9.77 $9.13 $6.10 $5.98 $4.58 $4.26 $3.35 $2.88
__________________________________________________________________________________________________________________________________
Income from investment operations:
Net investment income (loss) (.02) .03 (.02) (.03) .02 .06 .05 .05 .03 .01
Net gains (losses) on securities,
both realized and unrealized 3.68 (0.46) 0.95 0.67 3.01 .06 1.35 .27 .88 .46
__________________________________________________________________________________________________________________________________
Total from investment operations 3.66 (0.43) 0.93 0.64 3.03 .12 1.40 .32 .91 .47
__________________________________________________________________________________________________________________________________
Accumulation unit value at end
of year $13.93 $10.27 $10.70 $9.77 $9.13 $6.10 $5.98 $4.58 $4.26 $3.35
__________________________________________________________________________________________________________________________________
Total Return* 35.64% (4.01)% 9.50% 6.97% 49.83% 1.97% 30.60% 7.56% 26.90% 16.34%
__________________________________________________________________________________________________________________________________
Ratios/Supplemental Data
__________________________________________________________________________________________________________________________________
Total contract owner's equity
at end of year (000 omitted) $284,407 $223,317 $241,623 $228,366 $222,205 $155,426 $163,568 $136,141 $140,773 $121,189
Ratio of operating expenses
to average net assets 1.40% 1.40% 1.40% 1.40% 1.41% 1.41% 1.43% 1.40% 1.40% 1.40%
Ratio of net investment income
(loss) to average net assets (0.19)% 0.27% (0.17)% (0.30)% 0.22% 0.97% 0.99% 1.22% 0.67% 0.47%
Portfolio turnover rate 46% 63% 64% 74% 68% 56% 55% 66% 87% 110%
___________________________________________________________________________________________________________________________________
*Total return does not reflect payment of a sales charge.
This table pertains to accumulation units only. When you begin to receive your annuity payments, accumulation units change to
annuity units. The value of an annuity unit (assuming a 3.5% investment rate) was $5.39 as of Dec. 31, 1995, $4.11 as of Dec. 31,
1994, $4.44 as of Dec. 31, 1993, $4.19 as of Dec. 31, 1992, $4.06 as of Dec. 31, 1991, $2.80 as of Dec. 31, 1990, $2.84 as of Dec.
31, 1989, $2.25 as of Dec. 31, 1988, $2.17 as of Dec. 31, 1987, and $1.77 as of Dec. 31, 1986. The value of an annuity unit
(assuming a 5% investment rate) was $3.61 as of Dec. 31, 1995, $2.80 as of Dec. 31, 1994, $3.06 as of Dec. 31, 1993, $2.93 as of
Dec. 31, 1992, $2.88 as of Dec. 31, 1991, $2.02 as of Dec. 31, 1990, $2.08 as of Dec. 31, 1989, $1.67 as of Dec. 31, 1988, $1.63 as
of Dec. 31, 1987, and $1.35 as of Dec. 31, 1986.
The information in this table has been derived from financial statements of the Fund that have been audited by Ernst & Young LLP,
independent auditors. The independent auditor's report and additional information about the performance of the Fund are contained
in the Fund's annual report, which if not included with this prospectus, may be obtained without charge.
</TABLE>
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The variable annuity
An annuity is a contract with a life insurance company that
guarantees regular income to the purchaser. Most people buy
annuities to provide income in their retirement years. When most
people think of an annuity, they are thinking of a fixed dollar
annuity. With a fixed dollar annuity, the insurance company bears
the risk of investment gain or loss and guarantees payment of an
exact monthly amount. A variable annuity also guarantees you
regular payments. However, the amount of the payments will
fluctuate with the performance of the securities in which the
annuity fund invests. So if the securities go up in value, you may
receive larger annuity payments. If they go down, the amount of
the annuity payments you receive may be reduced.
Investment objective
The Fund's investment objective is long-term capital appreciation
so that the Fund can build up values and increase the size of
annuity payments. There can be no guarantee the Fund will achieve
its investment objective because any investment involves risk. The
Fund's investment objective can be changed by IDS Life without the
approval of the Fund's contract holders, but IDS Life has no
intention of doing so.
The Fund invests primarily in U.S. common stocks. The Fund also
may invest in preferred stocks and in corporate and government
bonds. Some bonds issued by agencies of the U.S. government are
not supported by the full faith and credit of the United States.
The Fund may invest up to 30% of its total assets at the time of
purchase in foreign securities. In selecting foreign investments,
the Fund generally will seek to invest in companies that it
anticipates will experience economic growth at least as great as
that anticipated in the U.S. companies in which it invests. The
securities that the Fund believes offer attractive opportunities
for investment may change from time to time. Foreign investments
may be subject to additional risks, including future political and
economic developments, the possible imposition of withholding taxes
on dividend income, the seizure or nationalization of companies,
the establishment of exchange controls or the adoption of other
restrictions that might adversely affect an investment.
The Fund may invest in the securities of foreign issuers directly
or in the form of American Depository Receipts (ADRs). ADRs are
receipts typically issued by an American bank or trust company that
evidence ownership of underlying securities issued by a foreign
corporation. Since investments in foreign securities will involve
currencies of foreign countries, the value of the Fund's assets as
measured in U.S. dollars may be affected favorably or unfavorably
by changes in currency rates and in exchange control regulations.
The Fund also may enter into forward commitments for the purchase
or sale of foreign currencies, but only in connection with the
settlement of foreign securities transactions and not for
speculative purposes.
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The Fund may enter into a forward contract to buy or sell foreign
currencies. For example, if the Fund believes the value of the
U.S. dollar will decline in relationship to a foreign currency, the
Fund will buy the foreign currency at today's price in U.S. dollars
agreeing to pay for the currency at a future date. If the U.S.
dollar declines, then the foreign currency can be sold for more
U.S. dollars than it cost and the Fund realizes a profit. The Fund
will not enter into forward contracts in excess of an offsetting
position of cash and investment in U.S. dollars. If the U.S.
dollar does not decline as expected, the Fund will sustain a loss
because of having entered into the forward contract.
The Fund may buy or write (sell) options traded on any U.S. or
foreign exchange or in the over-the-counter market. It may write
covered call options on individual securities. Options in the
over-the-counter market will be purchased only when the investment
manager believes a liquid secondary market exists for the options
and only from dealers and institutions the investment manager
believes present a minimal credit risk. Some options are
exercisable only on a specific date. In that case, or if a liquid
secondary market does not exist, the Fund could be required to buy
or sell securities at disadvantageous prices, thereby incurring
losses. In covered call options, the seller owns the underlying
security required to be sold upon exercise of the option.
Options can be used to produce incremental earnings, protect gains
and facilitate buying and selling securities. The writer of an
option agrees to buy or sell a security at a fixed price and could
forgo a profit or incur a loss from a change in the market price of
the security. The purchaser of an option pays a premium whether or
not the option is exercised. If a liquid secondary market does not
exist at a particular time, it might not be possible to close an
option position when it is desirable to do so. The Fund may buy
put and call options as a trading technique.
For temporary purposes, the Fund may make certain investments. It
may buy short-term U.S. and Canadian government securities. It may
invest in bank obligations including negotiable certificates of
deposit, non-negotiable fixed time deposits, bankers' acceptances
and documented discount notes (letters of credit). The Fund may
buy short-term corporate notes and obligations rated in the top two
classifications by Standard and Poor's, Moody's or the equivalent.
The Fund does not look to buy and sell stocks for the short-term,
but will do so if it is appropriate. The Fund may use repurchase
agreements with broker-dealers registered under the Securities
Exchange Act of 1934 and commercial banks. Repurchase agreements
involve investments in debt securities where the seller agrees to
repurchase the securities at cost plus an agreed-to interest rate
within a specified time. A risk of a repurchase agreement is that
if the seller seeks the protection of the bankruptcy laws the
Fund's ability to liquidate the security involved could be
impaired, and it might subsequently incur a loss if the value of
the securities declines or if the other party to a repurchase
agreement defaults on its obligation.
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PAGE 11
The Fund may enter into stock index futures contracts traded on any
U.S. or foreign exchange. The Fund may buy or write put and call
options on these futures and on stock indexes. These instruments
may be considered speculative and may expose the Fund to greater
risk. Stock index futures contracts, options on futures contracts
and options on stock indexes must be used as a hedge. This means
they must be used to offset changes in the value of some or all the
Fund's existing investments in stocks or be offset by the Fund's
cash position. The futures contracts and related options may help
the Fund to gain rapid exposure or protect itself from changes in
the market. Successful hedges depend on the portfolio manager's
ability to predict the future direction of stock prices or interest
rates. If the portfolio manager's prediction is incorrect, the
Fund would have been better off if no hedge had been made. Also,
skills and techniques necessary to arrive at such predictions are
different from those needed for predicting changes in individual
stocks.
No more than 5% of the Fund's net assets can be used at any one
time for good faith deposits on futures and premiums for options on
futures that do not offset existing investment positions.
No securities will be bought on margin, nor will the Fund make any
short sales of securities.
The Fund will not invest in securities that are not readily
marketable without registration or the filing of a notification
under the Securities Act of 1933 (1933 Act), or the taking of
similar action under other securities laws relating to the sale of
securities, if immediately after the making of any such investment
more than 10% of the Fund's net assets (taken at market or other
current value) is invested in these securities. For valuation, see
page __ of this prospectus.
The Fund will not buy securities of any investment trust or
investment company, except by purchase in the open market where no
commission or profit to a sponsor or dealer results from a purchase
other than customary broker's commission. The Fund does not intend
to invest in these securities but may do so to the extent of not
more than 15% of the Fund's net assets (taken at market or other
current value). The Fund will not invest in other mutual funds.
Notwithstanding any of the Fund's other investment policies, the
Fund may invest its assets in an open-end management investment
company having substantially the same investment objectives,
policies and restrictions as the Fund for the purpose of having
those assets managed as part of a combined pool.
The investment policies described above may be changed by the board
of managers.
For 1995, the Fund's portfolio turnover rate was 46%. For 1994,
the Fund's portfolio turnover rate was 63%, and for 1993, the
Fund's portfolio turnover rate was 64%. Portfolio turnover results
in brokerage costs and may affect the taxes the Fund must pay.
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PAGE 12
The prices of the securities in which the Fund invests fluctuate
daily. This means that the value of your contract goes up and
down. If values go down, your contract may be worth less than what
you paid for it.
Investments the Fund will not make
The Fund observes the following fundamental investment
restrictions, that may not be changed without approval by a vote of
the contract holders:
o The Fund will not borrow money or property except as a
temporary measure for extraordinary or emergency purposes,
and in an amount not exceeding one third of the market value
of its total assets (including borrowings) less liabilities
(other than borrowings) immediately after the borrowing.
o The Fund shall not underwrite securities of other issuers.
However, this shall not preclude the purchase of securities
for investment, on original issue or otherwise, and shall not
preclude the acquisition of portfolio securities under
circumstances where the Fund would not be free to sell them
without being deemed an underwriter for purposes of the 1933
Act and without registration of these securities or the
filing of a notification under the 1933 Act, or the taking of
similar action under other securities laws relating to the
sale of securities.
o The Fund does not intend to concentrate investments in any
particular industry, but reserves freedom of action to do so
provided that not more than 25% of its total assets, taken at
cost, may be so invested at any one time.
o The Fund may invest up to 10% of its total assets, taken at
cost, in real properties, but will not do so as a principal
activity.
o The Fund will not invest more than 5% of its total assets, at
market value, in securities of any one company, government or
political subdivision thereof, except that the limitation
will not apply to investments in securities issued by the
U.S. government, its agencies or instrumentalities and except
that up to 25% of the Fund's total assets may be invested
without regard to this 5% limitation.
o The Fund will not buy securities of any issuer if immediately
after, and as a result of a purchase, the Fund would own more
than 10% of the outstanding voting securities of the issuer.
o The Fund may not make cash loans if the total commitment
amount exceeds 5% of the Fund's total assets.
o The Fund will not buy or sell physical commodities unless
acquired as a result of ownership of securities or other
instruments, except this shall not prevent the Fund from
buying or selling options and futures contracts or from
investing in securities or other instruments backed by, or
whose value is derived from, physical commodities.<PAGE>
PAGE 13
Portfolio manager
Mitzi Malevich joined American Express Financial Corporation in
1983 and serves as vice president and senior portfolio manager.
She was appointed to manage this fund and IDS Life Variable Annuity
Fund B (Fund B) in January 1995, and has managed IDS Growth Fund
since 1992. Prior to that, she was a portfolio manager of pension
fund accounts.
Investment agreements
IDS Life is the Fund's investment manager. Under the Investment
Management Agreement between IDS Life and the Fund, IDS Life
charges a fee for managing the Fund's investments. This amounts to
0.4% of the Fund's average daily net assets for the year.
IDS Life does not keep all of this fee. IDS Life and American
Express Financial Corporation have an Investment Advisory Agreement
that calls for IDS Life to pay American Express Financial
Corporation a fee for serving as investment advisor for the Fund.
The fee is 0.25% of the Fund's average daily net assets for the
year.
In addition to paying its own management fee, the Fund also pays
all brokerage commissions and charges in the purchase and sale of
assets. Brokerage charges are paid to IDS Life for reimbursement
of charges incurred in the purchase and sale of foreign securities.
An Investment Management Agreement and an Advisory Agreement were
approved by the contract holders on Dec. 30, 1983, as a result of
the IDS/American Express Company merger. Both agreements will
continue each year as long as they are approved:
o by a majority of the Board of Managers of the Fund or a
majority of the outstanding votes of the Fund, and
o by a majority of the Board of Managers of the Fund who are
not "interested persons" of IDS Life or American Express
Financial Corporation.
All votes by the Board of Managers must be taken at a meeting
called specifically to approve or disapprove the agreements and all
votes must be cast in person.
IDS Life may cancel either of its agreements without penalty,
provided it gives 60 days' notice in writing. American Express
Financial Corporation and the Fund may do the same. If the Fund
decides to cancel its management agreement with IDS Life, it must
have the approval of either the Board of Managers or a majority of
the votes of contract holders. If there is any assignment of
either agreement it ends immediately.
Brokerage
Under the Investment Management Agreement, IDS Life has
responsibility for making the Fund's investment decisions, for
effecting the execution of trades for the Fund's portfolio and for
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PAGE 14
negotiating any brokerage commissions. IDS Life intends to direct
American Express Financial Corporation to execute trades and
negotiate commissions on its behalf. These services are covered by
the Investment Advisory Agreement between American Express
Financial Corporation and IDS Life. When American Express
Financial Corporation acts on IDS Life's behalf for the Fund, it
follows the rules described here for IDS Life. Total brokerage
commissions paid by the Fund for each of the last three
years were as follows: $225,653 for 1995, $310,227 for 1994 and
$327,804 for 1993. IDS Life intends to continue to examine and
consider ways available to reduce brokerage costs.
The Investment Management Agreement generally requires IDS Life to
use its best efforts to obtain the best available price and the
most favorable execution. However, brokerage firms may provide
some extra services, including economic or investment research and
analysis. Sometimes it may be desirable to compensate a broker for
research or brokerage services by paying a commission that might
not otherwise be charged, or a commission in excess of what another
broker might charge. The Board of Managers has adopted a policy
authorizing IDS Life to do so to the extent authorized by law, if
IDS Life determines, in good faith, that the amount of commission
is reasonable in relation to the value of the brokerage or research
services provided by the broker.
In purchases and sales of securities involving transactions not
listed on an exchange or in listed securities that are traded off
of the exchange, the Fund will deal with a market maker as
principal, or a broker as agent, depending upon the method believed
to produce the best available price and most favorable execution as
described above. In transactions with a broker who acts as
principal, commissions are generally not stated separately, but are
included in the price of the securities.
American Express Financial Corporation gives investment advice to a
number of investment companies and mutual funds. Where more than
one of these companies or funds are interested in the same
securities at the same time, American Express Financial Corporation
carries out the sale or purchase in a way that all agree in advance
is fair.
Sharing in a large transaction may affect the price or volume of
shares acquired. But by these transactions, the Fund hopes to gain
an advantage in execution.
The Fund may pay brokerage commissions to broker-dealer affiliates
of IDS Life, American Express Financial Corporation and American
Express Company.
The contracts
This prospectus describes the following types of individual
non-tax-qualified variable annuity contracts:
<PAGE>
PAGE 15
o An individual variable annuity contract offered for sale in
connection with an employer plan that, as of Dec. 8, 1981,
had already purchased one or more Fund annuity contracts.
These plans or programs are not intended to qualify under
Sections 401, 403, or 408 of the Code. Your purchase payment
for this contract is made by a number of annual payments;
o Installment payment - deferred annuity. You make purchase
payments in installments over a number of years. Annuity
payments will begin at some future date after all
installments have been paid;
o Single payment - deferred annuity. You make a single purchase
payment. Annuity payments are deferred until some future
date; and
o Single payment - immediate annuity. You make a single
purchase payment. Annuity payments will start within 60 days
after IDS Life approves your application.
The fixed account
The fixed account is an additional account to which you may choose
to allocate purchase payments and contract values. It provides
guaranteed values and periodically adjusted interest-crediting
rates.
If you have a deferred annuity contract, you can change your mind
from time to time and apply all or part of your future purchase
payments to the fixed account.
Also, the contract provides that once each contract year, you can
transfer accumulation values of at least $250 from the variable
account to the fixed account or from the fixed account to the
variable account. This right ends 30 days before annuity payments
begin. Presently, IDS Life does not intend to limit the number of
transfers from the variable account to the fixed account; however,
transfers from the fixed account to the variable account are
limited to one per contract year. Just write or telephone IDS Life
and indicate the dollar amount, percentage of, or number of
variable accumulation units to transfer from the Fund or the amount
of fixed dollar accumulation value to transfer to the Fund.
Automated transfers and partial surrenders
IDS Life currently allows deferred annuity contract holders to
establish: (1) automated transfers of contract values between the
fixed account and variable account; or (2) automated partial
surrenders of contract values. Both services can be in effect at
the same time and may be established through a one-time written or
telephone request to IDS Life.
The minimum transfer amount from any account or partial surrender
amount from the contract is $50 and such transfer or surrender can
be made on a monthly, quarterly, semi-annual or annual basis. You
may start or stop this service at any time but you must give IDS
<PAGE>
PAGE 16
Life 30 days' notice to change any automated transfer or surrender
instructions that are currently in place. Automated transfers or
partial surrenders are subject to all of the other contract
provisions and terms including provisions relating to the transfer
of money between accounts. They are not available for 1969 Series
Contracts that were issued prior to May 1971.
Automated transfers from the fixed account may not exceed an amount
that will deplete the fixed account within 24 months. If you have
made any type of transfer from the fixed account, you may not
transfer contract values from the variable account back to the
fixed account until the next contract anniversary.
Automated partial surrenders may be restricted by applicable law in
some contracts. In addition, the payment of additional purchase
payments, if allowed under the contract, while automated partial
surrenders are in effect, may not be appropriate and therefore, is
not permitted.
IDS Life has the authority to honor any telephone requests believed
to be authentic and will use reasonable procedures to confirm that
they are. This includes asking identifying questions and tape
recording calls. As long as the procedures are followed, neither
IDS Life nor its affiliates will be liable for any loss resulting
from fraudulent requests. If IDS Life receives your transfer
and/or variable surrender request before its close of business
(normally 3 p.m. Central time), it will be processed that day.
Calls received after its close of business will be processed the
next business day. At times when the volume of telephone requests
is unusually high, IDS Life will take special measures to ensure
that your call is answered as promptly as possible. A telephone
surrender request will not be allowed within 30 days of a phoned-in
address change.
You may request that telephone withdrawals not be authorized from
your account by writing IDS Life.
Automated partial surrenders may result in income taxes and IRS
penalty taxes being applied to all or a portion of the amount
surrendered. See the sections on Tax charges and Surrendering your
contract (page __).
Consult your tax advisor if you have any questions about the
taxation of your annuity.
Measuring the value of your contract
Because values are always changing with the performance of the
Fund's investments, it is not easy to measure value with a variable
annuity contract. For this reason, we use a technique that
involves "units." The performance of the Fund is measured by
changes in the value of a single unit, rather than the total value
of the Fund. There are two kinds of units. As long as you are
paying into the Fund they are called "accumulation units." When
you begin to receive your annuity payments, they change to "annuity
units."
<PAGE>
PAGE 17
o Accumulation units are used to measure the value of deferred
annuity contracts during the period before annuity payments
are made.
number of your value of one total
accumulation x accumulation = accumulation
units unit value
When you buy a deferred annuity contract, your purchase payments
will be credited as accumulation units to your contract.
o Annuity units determine the value of each annuity payment.
When you buy an immediate annuity contract, your purchase
payment will be credited as annuity units to your account.
Under a deferred annuity contract, when annuity payments are to
start, your accumulation value will be converted into annuity
units. From then on, your annuity payments are based on the
current annuity unit value.
number of your x annuity = value of one
annuity units unit value annuity payment
Dates we revalue units - Valuation date
Your units are valued at least once every seven days. At the
present time, your units are revalued each business day at the
close of trading on the New York Stock Exchange (NYSE). The Fund's
securities also will be valued on any business day there is a
sufficient degree of trading in the Fund's portfolio securities
such that the current net asset value of units might be materially
affected (if on that day the Fund is required to sell or redeem
securities). The net asset value per share generally changes each
day. During an emergency, the Fund can suspend redemption. Such
emergency situations would occur if:
o The NYSE closes for reasons other than the usual weekend and
holiday closings, or trading on the NYSE is restricted;
o Disposal of the Fund's securities is not reasonably
practicable, or it is not reasonably practicable for the Fund
to determine the fair value of its net assets, or
o The Securities and Exchange Commission under the provisions
of the Investment Company Act of 1940 (1940 Act) declares a
period of emergency to exist.
Splitting units
IDS Life can split accumulation or annuity units. It will only do
so if it is in the best interests of the contract holders, the
annuitants and IDS Life.
The valuation period
The valuation period starts after the close of business on one
valuation date and ends with the close of business on the next
valuation date.<PAGE>
PAGE 18
Valuing Fund assets
The net value of the Fund's assets is determined at the start of
each valuation period by taking the total value of the Fund's
assets and subtracting liabilities. The Fund's portfolio
securities are valued as follows:
o Securities traded on national securities exchanges are valued
at the last quoted sales price on that day. If a particular
security hasn't been traded on a certain day, we take the
average price between the last bid (offer to buy) and the
last asked (offer to sell) price.
o Securities with readily available market quotations but
without a listing on an exchange also are valued at the
average between the last bid and the last asked price.
o Short-term securities maturing more than 60 days from the
valuation date are valued at the market price or approximate
market value based on current interest rates. Short-term
securities maturing in 60 days or less but that originally
had maturities of more than 60 days at the acquisition date
are valued on an amortized cost basis using the market value
on the 61st day before maturity. Short-term securities
maturing in 60 days or less at the acquisition date are
valued at amortized cost. (Amortized cost is an approximation
of market value determined by systematically increasing the
carrying value of a security if acquired at a discount, or
systematically reducing the carrying value if acquired at a
premium, so that the carrying value is equal to maturity
value on the maturity date.)
o Securities and other assets without a ready market price are
valued at fair value. The Board of Managers is responsible
for using valuation methods that they believe give fair
value. In cases like this, they may use an outside
organization to value these securities. These organizations
may use methods that take into consideration yields, trading
characteristics and other market data.
When we credit your purchase payments
IDS Life credits each purchase payment at the end of the valuation
period during which it received the payment at its corporate
office.
The investment factor
On each valuation date, an investment factor is calculated for the
valuation period. This factor measures the Fund's investment
performance during the period. Here is how the investment factor
is determined:
First, the investment income for the period is determined by
combining the Fund's income (interest and any dividends), net
realized and unrealized capital gains or losses on investments and
<PAGE>
PAGE 19
expenses. Then, the net investment rate is determined by dividing
the Fund's net investment income by the net value of the Fund's
assets at the beginning of the valuation period.
Finally, the investment factor for any valuation period is the sum
of 1 plus the net investment rate. If the Fund has a negative
investment rate for a period, the investment factor will be less
than 1.
Valuing an accumulation unit
Accumulation units are used to measure the value of your contract
during the period before annuity payments begin. The value of an
accumulation unit is determined by multiplying the accumulation
unit value for the last valuation period by the investment factor
for the current period.
Here is an example: Assume the Fund's assets at the start of the
day were $1 million and the investment income for the day was
$2,000. The total expenses were $398.35 and the value of an
accumulation unit the day before was $1.101000.
Step 1. First, the net investment income is determined. This is
income minus expenses or $1,601.65 ($2,000 - $398.35).
Step 2. Next the investment rate is determined. This is the net
investment income divided by the assets at the start of the day or
0.001602 ($1,601.65 divided by 1,000,000).
Step 3. The investment factor is one plus the investment rate, or
1.001602.
Step 4. Finally, the value of an accumulation unit is determined
by multiplying yesterday's accumulation unit by the investment
factor. The current value of an accumulation unit comes out to
$1.102764 (1.101000 x 1.001602).
Valuing an annuity unit
When you are ready to receive annuity payments, your accumulation
units are exchanged for annuity units. Annuity units measure each
variable annuity payment. To determine the value of an annuity
unit, the annuity unit value on the last valuation date is
multiplied by the product of (1) the investment factor for the
current period, and (2) the neutralizing factor.
The neutralizing factor removes the assumed investment rate that is
built into the variable annuity tables in your contract. The
neutralizing factor for a one-day valuation period is 0.999866,
when the usual 5% assumed investment rate is used.
Here is a shortcut for calculating the value of an annuity unit:
Substitute the term "annuity unit" for the term "accumulation unit"
each time it appears in the example used for calculating
accumulation unit values.
<PAGE>
PAGE 20
Then take the answer in Step 4 ($1.102764) and multiply it by the
neutralizing factor (0.999866). The answer is the current value of
an annuity unit, or $1.102616.
The assumed investment rate is not always 5%. For example,
contracts subject to Texas law cannot use more than a 3.5%
investment rate. You can request a 3.5% investment rate by sending
a written request to IDS Life at its home office. The current
policy of IDS Life is to grant a request received no later than 30
days before settlement.
Why would you want a lower assumed investment rate? The value of
an annuity unit will rise or fall to the extent that the actual
investment rate for the period is more or less than the assumed
investment rate. A lower assumed rate produces a lower initial
annuity payment, but later payments will rise faster if unit values
are going up. Later payments will fall more slowly if unit values
are dropping.
Annuity payment starting date
For individual deferred contracts paid for in annual installments,
the annuity payment starting date selected must be at least 10
years after the date of your application. You can change the
payment date at any time not less than 30 days before annuity
payments are to start.
For single payment deferred contracts, the annuity payment starting
date must be at least 60 days after the application date.
For immediate contracts, the annuity payment starting date must be
no later than 60 days after the application date.
For employer plans, the annuity starting date must be at least so
many years after the application date that the number of years
multiplied by the annual purchase payment equals or exceeds $3,000.
For all contracts the annuity payment starting date must come
before (whichever one is later):
o the contract anniversary nearest the annuitant's 75th
birthday, or
o the 30th contract anniversary.
Table of settlement rates
Settlement rates are based on the Progressive Annuity Table
assuming all births in 1900. To determine the rate applicable at
settlement, we look at the annuitant's birthday nearest the
settlement date and subtract an adjustment according to the
following chart.
<PAGE>
PAGE 21
Calendar year of Adjustment for
annuitant's birth Male Female
______________________________________________________
Prior to 1920...................... 0 4
1920 through 1939.................. 1 5
1940 through 1954.................. 2 6
1955 through 1969.................. 3 7
After 1969......................... 4 8
______________________________________________________
In Arizona Governing Committee for Tax Deferred Annuity and
Deferred Compensation Plans, etc. et al. v. Nathalie Norris, etc.,
the United States Supreme Court decided that Title VII of the Civil
Rights Act of 1964 prohibits an employer from offering its
employees the option of receiving retirement benefits from one of
several companies selected by the employer, all of which pay a
woman lower monthly retirement benefits than a similarly situated
man. The Court ordered that all retirement benefits derived from
contributions made on and after Aug. 1, 1983, must be calculated
without regard to the sex of the annuitant.
IDS Life has been administering contributions received since Aug.
1, 1983, on the company's in-force annuity contracts to provide
retirement benefits without regard to the sex of the annuitant in
those markets which are affected by the Norris decision. Annuity
contract amendments also have been developed for new contracts in
order to assure continued compliance by employers with the
obligations imposed on them by the Norris decision.
Annuity payment plans
You may select on the application how you want annuity payments
made and when the payments are to begin. If you have a deferred
annuity contract you may change your payment plan at any time at
least 30 days before the annuity payment starting date.
Here are the plans available for all annuity contracts as described
in this prospectus:
Plan A - An annuity is paid each month during the lifetime of the
annuitant. No payments are made after the annuitant's death,
therefore, it is possible to receive only one annuity payment if
the annuitant dies shortly after annuity payments begin.
Plan B - An annuity is paid each month during the lifetime of the
annuitant with the additional guarantee that payments will be made
for at least five, 10, or 15 years as you select.
Plan C - An annuity is paid each month during the lifetime of the
annuitant with the additional guarantee that payments will be made
for a period not less than the number of months determined by
dividing the amount applied to Plan C by the amount of the first
monthly annuity payment.
<PAGE>
PAGE 22
Plan D - An annuity is paid each month during the lifetimes of two
named annuitants. When the first annuitant dies, payments continue
for the lifetime of the survivor. No payments are made after the
survivor's death unless you ask for the Plan D option. This
provides payments for a guaranteed period as in Plan B or Plan C.
A beneficiary of a variable annuity contract may ask for a lump-sum
payment under Plan B or Plan C. IDS Life will not grant the
request if you asked us not to.
If no plan has been selected by the annuity payment starting date,
Plan B with 120 guaranteed monthly payments will be used.
If the value of the contract is less than $2,000 on the annuity
payment starting date, the accumulation value may be paid in a
lump-sum.
Determination of monthly annuity payments for deferred contracts
When annuity payments are to begin, the first monthly variable
annuity payment is computed on the valuation date on or right
before the seventh day before the annuity payment starting date.
The computations are made using the table of settlement rates in
your contract unless an optional table is agreed upon. A different
table is used if you have elected a 3.5% assumed investment rate.
The amount of the first payment is divided by the annuity unit
value to give the number of annuity units for your contract.
Each monthly payment after the first one will be determined by
multiplying the number of annuity units by the current annuity unit
value. Payouts made by check will be computed on the valuation
date on or right before the fifth day before the annuity payment
date. Payouts made by a transfer to another IDS fund account will
be computed on the valuation date on or right before the annuity
payment date.
Here is an example: Assume the variable accumulation value on the
valuation date seven days before the annuity payment starting date
was $30,000 and the plan you selected produces an initial payment
of $6 for each $1,000 of accumulation value.
Ignoring premium taxes, if any, the first payment would be $180 (30
x $6 = $180).
Now assume the annuity unit value on the valuation date seven days
before the annuity payment starting date is $1.800000. The number
of annuity units for your contract is 100 ($180 divided by
$1.800000 = 100). Ordinarily, the value of the same number of
annuity units will be paid each month.
Determination of monthly annuity payments for immediate contracts
The number of your annuity units is multiplied by the value of one
unit. The value of one unit is determined on the valuation date on
or right before the seventh day before the annuity payment is due.
The following example shows how the number of your annuity units is
determined:<PAGE>
PAGE 23
Assume the net purchase payment is $30,000 and the conversion
factor, based on actuarial tables and the contract you selected, is
$5.50.
Assume the value of one annuity unit on the valuation date is
$1.500000.
First divide the net purchase payments by $1,000: $30,000 divided
by $1,000 = $30. Next, multiply the answer by the conversion
factor: $30 x $5.50 = $165.
Divide the answer by the value of one unit. This gives the number
of annuity units paid out each month: $165 divided by $1.500000 =
110 units.
The charges you pay
1) Sales and administrative charges
The tables below show the deductions from your purchase payments
for sales and administrative charges. The net amount invested is
the total purchase payments minus the deduction for sales and
administrative charges.
<TABLE><CAPTION>
Single payment contracts
____________________________________________________________________________________________________
Total charge Total deduction
Part of the Deduction Deduction for as percentage of as percentage of
total purchase for sales administrative total purchase net amount
payment charge charge payment invested
____________________________________________________________________________________________________
<S> <C> <C> <C> <C>
First $15,000 6% 2% 8% 8.70%
Next $10,000 4 1 5 5.26
Over $25,000 1.5 0.5 2 2.04
____________________________________________________________________________________________________
</TABLE>
<TABLE><CAPTION>
Installment payment contracts (other than employer plan contracts)
____________________________________________________________________________________________________
Total charge Total deduction
Deduction Deduction for as percentage of as percentage of
for sales administrative total purchase net amount
Contract year charge charge payments invested
____________________________________________________________________________________________________
<S> <C> <C> <C> <C>
1st 18% 2% 20% 25.00%
2nd & 3rd 16 2 18 21.95
4th 5 2 7 7.53
5th and after 2 2 4 4.17
If kept through 10 years 6.7 2 8.7 9.53
____________________________________________________________________________________________________
</TABLE>
<TABLE><CAPTION>
Employer plan -- annual purchase contracts
____________________________________________________________________________________________________
Part of Deduction Deduction Total Total
the total for for charge as deduction as
purchase sales administrative percentage of total percentage of net
payment charge charge purchase payments amount invested
____________________________________________________________________________________________________
<S> <C> <C> <C> <C>
First $10,000 3.75% 2% 5.75% 6.10%
Next $40,000 2 2 4 4.17
Excess over $50,000 0.5 1.5 2 2.04
____________________________________________________________________________________________________
</TABLE>
<PAGE>
PAGE 24
Pursuant to a Distribution and Services Agreement with the Fund,
IDS Life is the principal underwriter and performs all sales and
administrative duties. It pays salaries, sales commissions, legal,
accounting, auditing or actuarial fees and death benefits under
deferred variable annuity contracts. The deductions for sales and
administrative charges came to $91,903 for 1995, $91,643 for 1994
and $100,741 for 1993.
The sales and administrative charge may be reduced or eliminated,
but only to the extent IDS Life anticipates that it will incur
lower sales and administrative expenses or perform fewer services
due to economies arising from the size of the particular group, the
average contribution per participant and the utilization of mass
enrollment procedures. Generally, this will occur with programs
established by an employer for all employees or for all employees
in a class, wherein employees do not individually elect to
participate in the program.
2) Premium taxes
Some states may charge a premium tax in an amount of up to 3.5%.
If a state requires payment of a premium tax on your contract, a
deduction will be made from your purchase payments or from your
contract's accumulation value.
3) Increases in life expectancy and administrative expenses
IDS Life will bear any expenses that occur because of an increase
in administrative expenses, or because of an increase in the life
expectancy of people receiving variable annuity payments. But, it
is not responsible for increases in brokers' fees and transfer
taxes on the purchase and sale of assets.
For bearing this risk, IDS Life charges the Fund a fee equal to 1%
of the Fund's average daily net assets for the year. This came to
$2,556,131 for 1995, $2,323,727 for 1994 and $2,330,759 for 1993.
If the fee is more than enough to cover the increases, IDS Life
will keep the difference. If the fee is not enough, IDS Life bears
the loss.
4) Charge for investment management
For acting as investment manager, IDS Life charges the Fund a fee
equal to 0.4% of the Fund's average net assets for the year, less
any brokerage credits. This came to $1,022,508 for 1995, $929,540
for 1994 and $932,353 for 1993.
5) Tax charges
IDS Life is taxed as a life insurance company under Subchapter L of
the Code. The Fund is treated as part of IDS Life for federal
income tax purposes. IDS Life must pay all taxes that come about
because of the Fund. For this reason, IDS Life can charge the Fund
for tax charges. Under current federal income tax law, no taxes
are payable with respect to any income of the Fund.
Investment results credited to a contract are not taxed until
annuity benefits are received.<PAGE>
PAGE 25
Surrendering your contract
You can surrender all or part of your annuity contract any time
before the annuity payment starting date. There can be no
surrender in whole or in part after annuity payments have started.
For a discussion of automated partial surrenders, see page __.
Make your request to IDS Life in writing. IDS Life will cash in
the number of accumulation units for the amount you request. The
units are valued on the day your request is received in our
Minneapolis home office. You cannot surrender part of your
contract if the remaining accumulation value will be less than $20,
and you cannot repay any amount you surrender. A check usually
will be mailed to you within seven days after we process your
request. However, IDS Life can delay sending your check until we
are sure we have received good payment for the accumulation units
you want to surrender.
You may receive extra money if the Fund's state premium tax
liability is reduced as a result of your surrender. If it is, you
will receive either the amount of the reduction or the amount
already deducted from your purchase payments for premium taxes,
whichever is less.
Your surrender may result in adverse tax consequences. Consult a
qualified tax advisor before requesting a surrender.
Making withdrawals on your contract
You can make a temporary withdrawal on your contract any time
before the annuity payment starting date. The least you can
withdraw, including charges, is $250. The most you can withdraw is
the sum of your purchase payments less any amounts you previously
surrendered. There may be no more than one temporary withdrawal
outstanding at any one time. A charge of 2% of your withdrawal
will be made at the time of withdrawal in order to cover the
administrative costs of IDS Life.
You must pay your withdrawal back within two years. Your repayment
will be used to buy accumulation units at their current price.
However, you cannot make a repayment after the annuity payment
starting date. There are no sales charges. If you do not pay your
withdrawal back within two years, IDS Life will regard it as if
you surrendered that part of your contract.
How do you repay your withdrawal? Inform IDS Life in writing.
Otherwise your regular purchase payments will be used toward
repayment. What is left after you fully repay your withdrawal will
go toward your regular purchase payments. Any amount of your
purchase payment left over after repayment must be at least $10.
o Example: You make a withdrawal of $295 and your next purchase
payment is $300. Instead of applying $295 toward the withdrawal
and $5 toward the purchase payment, we will apply $290 toward the
withdrawal and $10 toward the purchase payment. Now you owe $5 on
your withdrawal. This amount will be taken out next time.<PAGE>
PAGE 26
Keep track of all your withdrawals and surrenders. If your
accumulation value falls to zero, your account will be closed.
Special rules if the annuitant dies before the annuity payment
starting date
Under a deferred annuity contract, if the annuitant dies before
annuity payments begin, the beneficiary will receive the greater
of:
o the sum of all purchase payments minus surrenders and unrepaid
withdrawals; or
o the accumulation value of the contract.
If the annuitant dies on or after the contract anniversary date
nearest his or her 75th birthday, only the accumulation value will
be paid to the beneficiary.
Your right to cancel installment contracts
You will receive a Statement of Charges and a Notice of
Cancellation Rights within 60 days after the contract is sent to
you. You will have 45 days from the time this notice was sent to
you to cancel your installment contract. You will receive the
current accumulation value of your account plus any amounts
deducted for taxes and charges.
What about your taxes?
Part of the annuity payment you receive is taxed as ordinary income
and part is excluded from income as your investment in the contract
under Section 72 of the Code.
The income earned on an annuity contract held by such entities as
corporations, partnerships or trusts generally will be treated as
ordinary income received during that year. This provision is
effective for annuity contract purchase payments made after Feb.
28, 1986.
If you surrender all or part of the contract before your annuity
payment starting date, the federal income tax consequences will
depend on when you made your purchase payments. For amounts
allocable to purchase payments made after Aug. 13, 1982, the amount
of any partial surrender will be taxed as ordinary income to the
extent that contract value exceeds the owner's investment in the
contract. In addition, a 10% penalty tax will be imposed on the
amount of any surrender proceeds that is includable in the owner's
income. However, the penalty tax would not affect any surrender
occurring after (1) the owner reaches age 59-1/2, (2) death of the
owner, (3) the owner's disability, or (4) if the distribution is
part of a series of substantially equal periodic payments over the
life or life expectancy of the owner (or joint lives or life
expectancy of the owner and beneficiary).
<PAGE>
PAGE 27
Any amount received as a withdrawal and the value of any part of an
annuity contract pledged or assigned as collateral is taxed as a
cash withdrawal to the extent allocable to investment in annuity
contracts after Aug. 13, 1982.
Amounts allocable to earlier purchase payments will be taxed as
ordinary income to the extent the amount surrendered exceeds the
owner's investment in the contract and will not be subject to the
10% penalty tax.
Unlike life insurance proceeds, the death benefit under an annuity
contract is not tax exempt. The gain, if any, is taxable as
ordinary income to the beneficiary in the year(s) he or she
receives the payments.
The contract is intended to qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract
are to be interpreted to ensure or maintain such tax qualification,
notwithstanding any other provisions of the contract. We reserve
the right to amend the contract to reflect any clarifications that
may be needed or are appropriate to maintain such qualification or
to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such
amendment.
Important: This discussion of federal tax laws is based upon IDS
Life's understanding of these laws as they are currently
interpreted. Federal tax laws or current interpretations of them
may change. For this reason and because tax consequences are
complex and highly individual and cannot always be anticipated, you
should consult a tax advisor if you have any questions about
taxation of your contract.
Voting rights
Voting rights of contract holders are granted and defined by the
regulations of the Fund. To the extent permitted under the 1940
Act, these voting rights may be modified by IDS Life without
submission to a vote of a majority of the outstanding voting units.
Variable contract holders can vote on:
o any changes in fundamental investment restrictions;
o the approval of and any changes to the investment management and
advisory agreements;
o the election of the Board of Managers; and
o the acceptance of the Fund's independent auditors.
A variable contract holder with accumulation units has a number of
votes equal to the number of accumulation units owned. Under a
contract where annuity payments have started, the number of votes
is determined by dividing the present value of all future annuity
payments by the value of one accumulation unit on the record date.
So there may be a gradual decline in the number of votes to which a
<PAGE>
PAGE 28
contract holder is entitled as annuity payments continue to be made
under the contract. The record date will be set by the Board of
Managers not more than 60 days before the regular meeting or any
special meeting of variable contract holders. Cumulative voting is
not authorized.
Management
Members of the Board of Managers and officers of the Fund
Richard W. Kling*
Chairman of the Board of Managers
IDS Tower 10
Minneapolis, MN
Director since February 1984; President since March 1994.
Executive Vice President, Marketing and Products from January 1988
to March 1994. Vice President, American Express Financial
Corporation, since January 1988. Director of IDS Life Series Fund,
Inc. and Member of the Board of Managers of IDS Life Variable
Annuity Funds A & B.
Edward Landes
Member of the Board of Managers
30 South 9th Street
Minneapolis, MN
Development consultant. Director of Endowment Development, YMCA of
Metropolitan Minneapolis. Former sales manager - Supplies Division
and district manager - Data Processing Division of IBM Corporation.
Retired 1983.
Janis E. Miller*
Member of the Board of Managers
IDS Tower 10
Minneapolis, MN
Director and Executive Vice President - Variable Assets, IDS Life,
since March 1994; Vice President, American Express Financial
Corporation, since June 1990. Director, Mutual Funds Product
Development and Marketing, American Express Financial Corporation,
from May 1987 to May 1990. Director of IDS Life Series Fund, Inc.
since March 1994.
Carl N. Platou
Member of the Board of Managers
312 South 6th Street
Minneapolis, MN
President Emeritus and Chief Executive Officer, Fairview Hospital
and Healthcare Services.
<PAGE>
PAGE 29
Gordon H. Ritz
Member of the Board of Managers
404 WCCO Radio Building
Minneapolis, MN
Director, Mid-America Publishing and Atrix International, Inc.
Former president, Com Rad Broadcasting Corp. Former director,
Sunstar Foods.
Morris Goodwin Jr.*
Vice President and Treasurer
IDS Tower 10
Minneapolis, MN
Vice President and Corporate Treasurer, American Express Financial
Corporation, since July 1989; Chief Financial Officer and
Treasurer, American Express Trust Company, from January 1988 to
July 1989.
Lorraine R. Hart*
Vice President, Investments
IDS Tower 10
Minneapolis, MN
Vice President - Insurance investments of American Express
Financial Corporation since 1989. Vice President - Investments of
IDS Life Insurance Company since 1992.
Timothy S. Meehan*
Secretary
IDS Tower 10
Minneapolis, MN
Secretary of American Express Financial Corporation, American
Express Financial Advisors Inc. and IDS Life Series Fund, Inc.
since October 1995. Senior counsel to American Express Financial
Corporation since 1995. Counsel from 1990 to 1995.
William A. Stoltzmann*
General Counsel and Assistant Secretary
IDS Tower
Minneapolis, MN
Vice President and Assistant General Counsel, American Express
Financial Corporation, since November 1985 and Vice President,
General Counsel and Secretary, IDS Life, since December 1989.
*Interested person of the Fund by reason of being an employee of
IDS Life or American Express Financial Corporation.
You vote at each regular meeting for the Fund's Board of Managers.
Members who are not salaried employees of IDS Life or one of its
affiliates receive up to $4,000 annually for serving on the Board.
<PAGE>
PAGE 30
All officers of the Fund are salaried employees of IDS Life or
American Express Financial Corporation and receive no remuneration
from the Fund. The officers and managers of the Fund aggregately
hold less than 1% of the outstanding voting units.
Directors and officers of IDS Life Insurance Company*
The Directors:
David R. Hubers
Director since September 1989; President and Chief Executive
Officer, American Express Financial Corporation, since August 1993
and Director, American Express Financial Corporation, since January
1984. Senior Vice President, Finance, and Chief Financial Officer,
American Express Financial Corporation, from January 1984 to August
1993.
Richard W. Kling
Director since February 1984; President since March 1994.
Executive Vice President, Marketing and Products from January 1988
to March 1994. Vice President, American Express Financial
Corporation, since January 1988. Director of IDS Life Series Fund,
Inc. and Member of the Board of Managers of IDS Life Variable
Annuity Funds A & B.
Paul F. Kolkman
Director since May 1984; Executive Vice President since March 1994;
Vice President, Finance from May 1984 to March 1994; Vice
President, American Express Financial Corporation, since January
1987.
Janis E. Miller
Director and Executive Vice President, Variable Assets since March
1994; Vice President, American Express Financial Corporation, since
June 1990. Director, Mutual Funds Product Development and
Marketing, American Express Financial Corporation, from May 1987 to
May 1990. Director of IDS Life Series Fund, Inc. and Manager of
IDS Life Variable Annuity Funds A & B.
James A. Mitchell
Chairman of the Board since March 1994; Director since July 1984;
Chief Executive Officer since November 1986; President from July
1984 to March 1994; Executive Vice President, American Express
Financial Corporation, since March 1994; Director, American Express
Financial Corporation, since July 1984. Senior Vice President,
American Express Financial Corporation, from July 1984 to March
1994.
Barry J. Murphy
Director and Executive Vice President, Client Service since March
1994; Senior Vice President, Operations, Travel Related Services
(TRS), a subsidiary of American Express Company, since July 1992;
Vice President, TRS, from November 1989 to July 1992; Chief
Operating Officer, TRS, from March 1988 to November 1989.
<PAGE>
PAGE 31
Stuart A. Sedlacek
Director and Executive Vice President, Assured Assets since March
1994; Vice President, American Express Financial Corporation, since
September 1988.
Melinda S. Urion
Director and Controller since September 1991; Executive Vice
President since March 1994; Vice President and Treasurer from
September 1991 to March 1994; Vice President, American Express
Financial Corporation, since September 1991; Chief Accounting
Officer, American Express Financial Corporation, from July 1988 to
September 1991.
Officers Other Than Directors
Morris Goodwin Jr.
Vice President and Treasurer since March 1994; Vice President and
Corporate Treasurer, American Express Financial Corporation, since
July 1989; Chief Financial Officer and Treasurer, American Express
Trust Company, from January 1988 to July 1989.
William A. Stoltzmann
Vice President, General Counsel and Secretary since 1985.
*The address for all of the directors and principal officers is:
IDS Tower 10, Minneapolis, MN 55440-0010.
Other Information
History
The Fund is an open-end diversified investment company as defined
under the 1940 Act. It was organized as a segregated asset account
by IDS Life under Minnesota law on May 10, 1968.
IDS Life is a stock life insurance company organized under
Minnesota law on Aug. 7, 1957. It conducts a conventional life
insurance business in addition to its variable annuity business.
IDS Life Insurance Company is not a bank, and the securities it
offers are not backed or guaranteed by any bank nor are they
insured by the FDIC.
Assets of the Fund
On Dec. 31, 1995, there were 11,446 outstanding contracts. The
assets were $284,495,712.
The assets of the Fund are held solely for the variable contract
holders. The assets are not used to pay liabilities of any other
business of IDS Life.
<PAGE>
PAGE 32
Headquarters
The corporate office of IDS Life is located in the IDS Tower in
Minneapolis, Minnesota.
Ownership of IDS Life and American Express Financial Corporation
All of the capital stock of IDS Life is owned by American Express
Financial Corporation. On Jan. 12, 1984, Investors Diversified
Services, Inc., of which IDS Life was a wholly owned subsidiary,
was merged into a wholly owned subsidiary of American Express
Company to form IDS Financial Services Inc. On Jan. 1, 1995, IDS
Financial Corporation's name was changed to American Express
Financial Corporation, and IDS Financial Services Inc.'s name was
changed to American Express Financial Advisors Inc. American
Express Financial Corporation serves as investment advisor for the
Fund. American Express Financial Corporation is an investment
advisor for a number of open-end investment companies and for its
subsidiaries. The headquarters of American Express Financial
Corporation is IDS Tower, Minneapolis, Minnesota.
Other affiliations
IDS Life also distributes different variable annuity contracts
including: Fund B, IDS Life Variable Retirement Annuity, IDS Life
Combination Retirement Annuity, IDS Life Flexible Annuity, IDS Life
Flexible Portfolio Annuity, IDS Life Real Estate Variable Annuity,
IDS Life Group Variable Annuity Contract and IDS Life Employee
Benefit Annuity.
The members of the Fund's Board of Managers also serve on the Board
of Managers of Fund B and on the Board of Directors of IDS Life
Series Fund, Inc.
IDS Life manages Fund A, Fund B and nine mutual funds existing
within the IDS MUTUAL FUND GROUP advised by American Express
Financial Corporation. These nine mutual funds are available for
purchase only through variable annuity contracts which are
distributed by IDS Life and its subsidiaries, IDS Life Insurance
Company of New York, American Enterprise Life Insurance Company and
American Partners Life Insurance Company. The names of these funds
are: IDS Life Capital Resource Fund, IDS Life Aggressive Growth
Fund, IDS Life International Equity Fund, IDS Life Special Income
Fund, IDS Life Managed Fund, IDS Life Moneyshare Fund, IDS Life
Growth Dimensions Fund, IDS Life Global Yield Fund and IDS Life
Income Advantage Fund. IDS Life also manages IDS Life Series Fund,
Inc., which is available for purchase only through policies
distributed by IDS Life and IDS Life Insurance Company of New York.
Custodian
Pursuant to a custodian agreement, the Fund's securities and cash
are held by American Express Trust Company, 1200 Northstar Center
West, 625 Marquette Ave., Minneapolis, MN 55402-2307.
<PAGE>
PAGE 33
The custodian has entered into a sub-custodian arrangement with
Morgan Stanley Trust Company, One Pierrepont Plaza, Brooklyn, NY
11201. As part of this arrangement, portfolio securities purchased
outside the United States may be held in custody and deposit
accounts that have been established by Morgan Stanley with one or
more domestic or foreign banks, or through the facilities of one or
more clearing agencies or central securities depositories as may be
permitted by law and by the Fund's sub-custodian agreement.
Insurance regulation
IDS Life is regulated by the Department of Commerce of the State of
Minnesota. From time to time, the department examines the
company's liabilities and reserves and certifies their correctness.
IDS Life also is subject to insurance laws and regulations of other
states where it is licensed to do business.
Financial statements
The Report of Independent Auditors and the Financial Statements,
including Notes to Financial Statements and the schedule of
investments in securities, contained in the 1995 Annual Report to
IDS Life Variable Annuity Fund A contract holders, pursuant to
Section 30(d) of the 1940 Act, are hereby incorporated in this
Prospectus by reference. No other portion of the Annual Report,
however, is incorporated by reference.
<PAGE>
PAGE 34
IDS Life Financial Information
The financial statements shown below are those of the insurance
company and not those of any other entity. They are included in
the prospectus for the purpose of informing investors as to the
financial condition of the insurance company and its ability to
carry out its obligations under its variable contracts.
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
CONSOLIDATED BALANCE SHEETS
Dec. 31, Dec. 31,
ASSETS 1995 1994
(thousands)
<S> <C> <C>
Investments:
Fixed maturities:
Held to maturity, at amortized cost (Fair value:
1995, $11,878,377; 1994 $10,694,800) $11,257,591 $11,269,861
Available for sale, at fair value (Amortized cost:
1995, $10,146,136; 1994 $8,459,128) 10,516,212 8,017,555
Mortgage loans on real estate
(Fair value: 1995, $3,184,666; 1994, $2,342,520) 2,945,495 2,400,514
Policy loans 424,019 381,912
Other investments 146,894 51,795
Total investments 25,290,211 22,121,637
Cash and cash equivalents 72,147 267,774
Receivables:
Reinsurance 114,387 80,304
Amounts due from brokers - 7,933
Other accounts receivable 33,667 49,745
Premiums due 5,441 1,594
Total receivables 153,495 139,576
Accrued investment income 348,008 317,510
Deferred policy acquisition costs 2,025,725 1,865,324
Deferred income taxes - 124,061
Other assets 36,410 30,426
Separate account assets 14,974,082 10,881,235
Total assets $42,900,078 $35,747,543
========== ==========
<PAGE>
PAGE 35
IDS LIFE INSURANCE COMPANY
CONSOLIDATED BALANCE SHEETS (continued)
Dec. 31, Dec. 31,
LIABILITIES AND STOCKHOLDER'S EQUITY 1995 1994
(thousands)
Liabilities:
Fixed annuities--future policy benefits $21,404,836 $19,361,979
Universal life-type insurance--future policy benefits 3,076,847 2,896,100
Traditional life insurance--future policy benefits 209,249 206,754
Disability income, health and long-term care
insurance--future policy benefits 327,157 244,077
Policy claims and other policyholders' funds 56,323 50,068
Deferred income taxes 112,904 -
Amounts due to brokers 121,618 226,737
Other liabilities 285,354 291,902
Separate account liabilities 14,974,082 10,881,235
Total liabilities 40,568,370 34,158,852
Stockholder's equity:
Capital stock, $30 par value per share;
100,000 shares authorized, issued and outstanding 3,000 3,000
Additional paid-in capital 278,814 222,000
Net unrealized gain (loss) on investments 230,129 (275,708)
Retained earnings 1,819,765 1,639,399
Total stockholder's equity 2,331,708 1,588,691
Total liabilities and stockholder's equity $42,900,078 $35,747,543
========== ==========
Commitments and contingencies (Note 6)
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
PAGE 36
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF INCOME
Years ended Dec. 31,
1995 1994 1993
(thousands)
<S> <C> <C> <C>
Revenues:
Premiums:
Traditional life insurance $ 50,193 $ 48,184 $ 48,137
Disability income and long-term care insurance 111,337 96,456 79,108
Total premiums 161,530 144,640 127,245
Policyholder and contractholder charges 256,454 219,936 184,205
Management and other fees 215,581 164,169 120,139
Net investment income 1,907,309 1,781,873 1,783,219
Net realized loss on investments (4,898) (4,282) (6,737)
Total revenues 2,535,976 2,306,336 2,208,071
Benefits and expenses:
Death and other benefits - Traditional life
insurance 29,528 28,263 32,136
Death and other benefits - Universal life-type
insurance and investment contracts 71,691 52,027 49,692
Death and other benefits - Disability income,
health and long-term care insurance 16,259 13,393 13,148
Increase (decrease) in liabilities for future
policy benefits:
Traditional life insurance (1,315) (3,229) (4,513)
Disability income, health and
long-term care insurance 51,279 37,912 32,528
Interest credited on universal life-type
insurance and investment contracts 1,315,989 1,174,985 1,218,647
Amortization of deferred policy acquisition costs 280,121 280,372 211,733
Other insurance and operating expenses 211,642 210,101 241,974
Total benefits and expenses 1,975,194 1,793,824 1,795,345
Income before income taxes 560,782 512,512 412,726
Income taxes 195,842 176,343 142,647
Net income $ 364,940 $ 336,169 $ 270,079
========= ========= =========
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
PAGE 37
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
Three years ended December 31, 1995 (thousands)
Additional Net Unrealized
Capital Paid-In Gain (Loss) on Retained
Stock Capital Investments Earnings Total
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1992 $3,000 $ 22,000 $ 214 $1,223,151 $1,248,365
Net income 270,079 270,079
Change in net unrealized
gain (loss) on investments - - (100) - (100)
Capital contribution from parent - 200,000 - - 200,000
Cash dividends - - - (25,000) (25,000)
Balance, December 31, 1993 3,000 222,000 114 1,468,230 1,693,344
Net income - - - 336,169 336,169
Change in net unrealized
gain (loss) on investments - - (275,822) - (275,822)
Cash dividends - - - (165,000) (165,000)
Balance, December 31, 1994 3,000 222,000 (275,708) 1,639,399 1,588,691
Net income - - - 364,940 364,940
Change in net unrealized
gain (loss) on investments - - 505,837 - 505,837
Capital contribution from parent - 56,814 - - 56,814
Loss on reinsurance transaction
with affiliate - - - (4,574) (4,574)
Cash dividends - - - (180,000) (180,000)
Balance, December 31, 1995 $3,000 $278,814 $230,129 $1,819,765 $2,331,708
====== ======== ======== ========== ==========
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
PAGE 38
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended Dec. 31,
1995 1994 1993
(thousands)
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ 364,940 $ 336,169 $ 270,079
Adjustments to reconcile net income to
net cash provided by operating activities:
Issuance-policy loans, excluding universal
life-type insurance: (46,011) (37,110) (35,886)
Policy loan repayments, excluding universal
life-type insurance 36,416 33,384 29,557
Change in reinsurance receivable (34,083) (25,006) (55,298)
Change in other accounts receivable 16,078 (28,286) (1,364)
Change in accrued investment income (30,498) (10,333) (22,057)
Change in deferred policy acquisition costs, net (196,963) (192,768) (211,509)
Change in liabilities for future policy
benefits for traditional life, disability income,
health and long-term care insurance 85,575 55,354 79,695
Change in policy claims and other policyholders' funds 6,255 5,552 (5,383)
Change in deferred income taxes (33,810) (19,176) (44,237)
Change in other liabilities (6,548) (122) 56,515
Amortization of premium (accretion
of discount), net (22,528) 30,921 (27,438)
Net loss on investments 4,898 4,282 6,737
Premiums related to universal life--type insurance 465,631 409,035 397,883
Surrenders and death benefits related to
universal life--type insurance (306,600) (290,427) (255,133)
Interest credited to account balances related
to universal life--type insurance 162,222 150,955 156,885
Policyholder and contractholder charges, non-cash (140,506) (126,918) (115,140)
Other, net 2 (8,974) (1,907)
Net cash provided by operating activities $ 324,470 $ 286,532 $ 221,999
<PAGE>
PAGE 39
IDS LIFE INSURANCE COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
Years ended Dec. 31,
1995 1994 1993
(thousands)
Cash flows from investing activities:
Fixed maturities held to maturity:
Purchases $(1,007,208) $ (879,740) $ -
Maturities, sinking fund payments and calls 538,219 1,651,762 -
Sales 332,154 58,001 -
Fixed maturities available for sale:
Purchases (2,452,181) (2,763,278) -
Maturities, sinking fund payments and calls 861,545 1,234,401 -
Sales 136,825 374,564 -
Fixed maturities:
Purchases - - (6,548,852)
Maturities, sinking fund payments and calls - - 3,934,055
Sales - - 487,983
Other investments, excluding policy loans:
Purchases (823,131) (634,807) (553,694)
Sales 160,521 243,862 123,352
Change in amounts due from brokers 7,933 (2,214) 14,483
Change in amounts due to brokers (105,119) (124,749) 92,832
Net cash used in investing activities (2,350,442) (842,198) (2,449,841)
Cash flows from financing activities:
Activity related to investment contracts:
Considerations received 3,723,894 3,157,778 2,843,668
Surrenders and death benefits (2,834,804) (3,311,965) (1,765,869)
Interest credited to account balances 1,153,767 1,024,031 1,071,917
Policy loan issuances, universal
life-type insurance (84,700) (78,239) (70,304)
Policy loan repayments, universal
life-type insurance 52,188 50,554 46,148
Capital contribution from parent - - 200,000
Cash dividend to parent (180,000) (165,000) (25,000)
Net cash provided by financing activities 1,830,345 677,159 2,300,560
Net (decrease) increase in cash and
cash equivalents (195,627) 121,493 72,718
Cash and cash equivalents at
beginning of year 267,774 146,281 73,563
Cash and cash equivalents at
end of year $ 72,147 $ 267,774 $ 146,281
========== ========== ==========
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
PAGE 40
IDS LIFE INSURANCE COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
($ thousands)
1. Summary of significant accounting policies
Nature of business
IDS Life Insurance Company (the Company) is a stock life insurance
company organized under the laws of the State of Minnesota. The
Company is a wholly owned subsidiary of American Express Financial
Corporation, which is a wholly owned subsidiary of American Express
Company. The Company serves residents of all states except New
York. IDS Life Insurance Company of New York is a wholly owned
subsidiary of the Company and serves New York State residents. The
Company also wholly owns American Enterprise Life Insurance
Company, American Centurion Life Assurance Company (ACLAC), and
American Partners Life Insurance Company.
The Company's principal products are deferred annuities and
universal life insurance, which are issued primarily to
individuals. It offers single premium and annual premium deferred
annuities on both a fixed and variable dollar basis. Immediate
annuities are offered as well. The Company's insurance products
include universal life (fixed and variable), whole life, single
premium life and term products (including waiver of premium and
accidental death benefits). The Company also markets disability
income and long-term care insurance.
The Company's principal annuity product in terms of amount in force
is the fixed deferred annuity. The annuity contract guarantees a
minimum interest rate during the accumulation period (the time
before annuity payments begin), although the Company normally pays
a higher rate reflective of current market rates. The fixed
annuity provides for a surrender charge during the first seven to
ten years after a purchase payment is made. The Company has also
adopted a practice whereby the higher current rate is guaranteed
for a specified period. The Company also offers a variable annuity
product under the name Flexible Annuity. This is a fixed/variable
annuity offering the purchasers a choice among mutual funds with
portfolios of equities, bonds, managed assets and/or short-term
securities, and the Company's general account, as the underlying
investment vehicles. With respect to funds applied to the variable
portion of the annuity, the purchaser, rather than the Company,
assumes the investment risks and receives the rewards inherent in
the ownership of the underlying investment. The Flexible Annuity
provides for a surrender charge during the first six years after a
purchase payment is made.
The Company's principal insurance product is the flexible-premium,
adjustable-benefit universal life insurance policy. In this type
of insurance policy, each premium payment accumulates interest in
a cash value account. The policyholder has access to the cash
surrender value in whole or in part after the first year. The size
of the cash value of the fund can also be controlled by the
policyholder by increasing or decreasing premiums, subject only to
<PAGE>
PAGE 41
1. Summary of significant accounting policies (continued)
maintaining a required minimum to keep the policy in force.
Monthly deductions from the cash value of the policy are made for
the cost of insurance, expense charges and any policy riders.
Basis of presentation
The accompanying consolidated financial statements include the
accounts of the Company and its wholly owned subsidiaries, IDS Life
Insurance Company of New York, American Enterprise Life Insurance
Company, American Centurion Life Assurance Company and American
Partners Life Insurance Company. All material intercompany
accounts and transactions have been eliminated in consolidation.
The accompanying consolidated financial statements have been
prepared in conformity with generally accepted accounting
principles which vary in certain respects from reporting practices
prescribed or permitted by state insurance regulatory authorities.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities 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.
Investments
Fixed maturities that the Company has both the positive intent and
the ability to hold to maturity are classified as held to maturity
and carried at amortized cost. All other fixed maturities and all
marketable equity securities are classified as available for sale
and carried at fair value. Unrealized gains and losses on
securities classified as available for sale are carried as a
separate component of stockholder's equity.
Management determines the appropriate classification of fixed
maturities at the time of purchase and reevaluates the
classification at each balance sheet date.
Mortgage loans on real estate are carried principally at the unpaid
principal balances of the related loans. Policy loans are carried
at the aggregate of the unpaid loan balances which do not exceed
the cash surrender values of the related policies. Other
investments include interest rate caps, equity securities and real
estate investments. When evidence indicates a decline, which is
other than temporary, in the underlying value or earning power of
individual investments, such investments are written down to the
fair value by a charge to income. Equity securities are carried
at market value and the related net unrealized appreciation or
depreciation is reported as a credit or charge to stockholder's
equity.
Realized investment gain or loss is determined on an identified
cost basis.
<PAGE>
PAGE 42
1. Summary of significant accounting policies (continued)
Prepayments are anticipated on certain investments in mortgage-
backed securities in determining the constant effective yield used
to recognize interest income. Prepayment estimates are based on
information received from brokers who deal in mortgage-backed
securities.
Statement of cash flows
The Company considers investments with a maturity at the date of
their acquisition of three months or less to be cash equivalents.
These securities are carried principally at amortized cost which
approximates fair value.
Supplementary information to the consolidated statement of cash
flows for the years ended Dec. 31 is summarized as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Cash paid during the year for:
Income taxes $191,011 $226,365 $188,204
Interest on borrowings 5,524 1,553 2,661
</TABLE>
Recognition of profits on fixed annuity contracts and insurance
policies
The Company issues single premium deferred annuity contracts that
provide for a service fee (surrender charge) at annually decreasing
rates upon withdrawal of the annuity accumulation value by the
contract owner. No sales fee is deducted from the contract
considerations received on these contracts ("no load" annuities).
All of the Company's single premium deferred annuity contracts
provide for crediting the contract owners' accumulations at
specified rates of interest. Such rates are revised by the Company
from time to time based on changes in the market investment yield
rates for fixed-income securities.
Profits on single premium deferred annuities and installment
annuities are recognized by the Company over the lives of the
contracts and represent the excess of investment income earned from
investment of contract considerations over interest credited to
contract owners and other expenses.
The retrospective deposit method is used in accounting for
universal life-type insurance. This method recognizes profits over
the lives of the policies in proportion to the estimated gross
profits expected to be realized.
Premiums on traditional life, disability income, health and long-
term care insurance policies are recognized as revenue when
collected or due, and related benefits and expenses are associated
with premium revenue in a manner that results in recognition of
profits over the lives of the insurance policies. This association
is accomplished by means of the provision for future policy
benefits and the deferral and subsequent amortization of policy
acquisition costs.
<PAGE>
PAGE 43
1. Summary of significant accounting policies (continued)
Deferred policy acquisition costs
The costs of acquiring new business, principally sales
compensation, policy issue costs, underwriting and certain sales
expenses, have been deferred on insurance and annuity contracts.
The deferred acquisition costs for single premium deferred
annuities and installment annuities are amortized based upon
surrender charge revenue and a portion of the excess of investment
income earned from investment of the contract considerations over
the interest credited to contract owners. The costs for universal
life-type insurance are amortized over the lives of the policies as
a percentage of the estimated gross profits expected to be realized
on the policies. For traditional life, disability income, health
and long-term care insurance policies, the costs are amortized over
an appropriate period in proportion to premium revenue.
Liabilities for future policy benefits
Liabilities for universal life-type insurance, single premium
deferred annuities and installment annuities are accumulation
values.
Liabilities for fixed annuities in a benefit status are based on
the Progressive Annuity Table with interest at 5 percent, the 1971
Individual Annuity Table with interest at 7 percent or 8.25
percent, or the 1983a Table with various interest rates ranging
from 5.5 percent to 9.5 percent, depending on year of issue.
Liabilities for future benefits on traditional life insurance have
been computed principally by the net level premium method, based on
anticipated rates of mortality (approximating the 1965-1970 Select
and Ultimate Basic Table for policies issued after 1980 and the
1955-1960 Select and Ultimate Basic Table for policies issued prior
to 1981 and the 1975-1980 Select and Ultimate Basic Table for term
insurance policies issued after 1984), policy persistency derived
from Company experience data (first year rates ranging from
approximately 70 percent to 90 percent and increasing rates
thereafter), and estimated future investment yields of 4 percent
for policies issued before 1974 and 5.25 percent for policies
issued from 1974 to 1980. Cash value plans issued in 1980 and
later assume future investment rates that grade from 9.5 percent to
5 percent over 20 years. Term insurance issued from 1981 to 1984
assumes an 8 percent level investment rate, term insurance issued
from 1985-1993 assumes investment rates that grade from 10 percent
to 6 percent over 20 years and term insurance issued after 1993
assumes investment rates that grade from 8 percent to 6.5 percent
over 7 years.
Liabilities for future disability income policy benefits have been
computed principally by the net level premium method, based on the
1964 Commissioners Disability Table with the 1958 Commissioners
Standard Ordinary Mortality Table at 3 percent interest for persons
disabled in 1980 and prior, 8 percent interest for persons disabled
from 1981 to 1991, 7 percent interest for persons disabled in 1992
and 6 percent interest for persons disabled after 1992.
<PAGE>
PAGE 44
1. Summary of significant accounting policies (continued)
Liabilities for future benefits on long-term care insurance have
been computed principally by the net level premium method, using
morbidity rates based on the 1985 National Nursing Home Survey and
mortality rates based on the 1983a Table. The interest rate basis
is 9.5 percent grading to 7 percent over ten years for policies
issued from 1989 to 1992, 7.75 percent grading to 7 percent over
four years for policies issued after 1992, 8 percent for claims
incurred in 1989 to 1991, 7 percent for claims incurred in 1992 and
6 percent for claims incurred after 1992.
Reinsurance
The maximum amount of life insurance risk retained by the Company
on any one life is $750 of life and waiver of premium benefits plus
$50 of accidental death benefits. The maximum amount of disability
income risk retained by the Company on any one life is $6 of
monthly benefit for benefit periods longer than three years. The
excesses are reinsured with other life insurance companies on a
yearly renewable term basis. Graded premium whole life and long-
term care policies are primarily reinsured on a coinsurance basis.
Federal income taxes
The Company's taxable income is included in the consolidated
federal income tax return of American Express Company. The Company
provides for income taxes on a separate return basis, except that,
under an agreement between American Express Financial Corporation
and American Express Company, tax benefit is recognized for losses
to the extent they can be used on the consolidated tax return. It
is the policy of American Express Financial Corporation to
reimburse a subsidiary for any tax benefit.
Included in other liabilities at Dec. 31, 1995 is $13,415 payable
to American Express Financial Corporation for federal income taxes.
Included in other receivables at Dec. 31, 1994 is $22,034
receivable from American Express Financial Corporation for federal
income taxes.
Separate account business
The separate account assets and liabilities represent funds held
for the exclusive benefit of the variable annuity and variable life
insurance contract owners. The Company receives investment
management and mortality and expense assurance fees from the
variable annuity and variable life insurance mutual funds and
separate accounts. The Company also deducts a monthly cost of
insurance charge and receives a minimum death benefit guarantee fee
and issue and administrative fee from the variable life insurance
separate accounts.
The Company makes contractual mortality assurances to the variable
annuity contract owners that the net assets of the separate
accounts will not be affected by future variations in the actual
life expectancy experience of the annuitants and the beneficiaries
from the mortality assumptions implicit in the annuity contracts.
<PAGE>
PAGE 45
1. Summary of significant accounting policies (continued)
The Company makes periodic fund transfers to, or withdrawals from,
the separate accounts for such actuarial adjustments for variable
annuities that are in the benefit payment period. The Company
guarantees, for the variable life insurance policyholders, the
contractual insurance rate and that the death benefit will never be
less than the death benefit at the date of issuance.
Accounting changes
The Financial Accounting Standards Board's (FASB) SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to Be Disposed Of," is effective January 1, 1996. The
new rule is not expected to have a material impact on the Company's
results of operations or financial condition.
The Company's adoption of SFAS No. 114 as of January 1, 1995 is
discussed in Note 2.
The Company adopted SFAS No. 115, "Accounting for Certain
Investments in Debt and Equity Securities." The effect of adopting
the new rule was to increase stockholder's equity by approximately
$181 million, net of tax, as of January 1, 1994, but the adoption
had no impact on the Company's net income.
Reclassification
Certain 1994 and 1993 amounts have been reclassified to conform to
the 1995 presentation.
2. Investments
Fair values of investments in fixed maturities represent quoted
market prices and estimated values when quoted prices are not
available. Estimated values are determined by established
procedures involving, among other things, review of market indices,
price levels of current offerings of comparable issues, price
estimates and market data from independent brokers and financial
files.
Net realized gain (loss) on investments for the years ended Dec. 31
is summarized as follows:
1995 1994 1993
Fixed maturities $ 9,973 $(1,575) $ 20,583
Mortgage loans (13,259) (3,013) (25,056)
Other investments (1,612) 306 (2,264)
$ (4,898) $(4,282) $ (6,737)
Changes in net unrealized appreciation (depreciation) of
investments for the years ended Dec. 31 are summarized as follows:
1995 1994 1993
Fixed maturities:
Held to maturity $1,195,847 $(1,329,740) $ --
Available for sale 811,649 (720,449) --
Investment securities -- -- 323,060
Equity securities 3,118 (2,917) (156)<PAGE>
PAGE 46
2. Investments (continued)
The amortized cost, gross unrealized gains and losses and fair
values of investments in fixed maturities and equity securities at
Dec. 31, 1995 are as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Held to maturity Cost Gains Losses Value
<S> <C> <C> <C> <C>
U.S. Government agency
obligations $ 64,523 $ 3,919 $ -- $ 68,442
State and municipal obligations 11,936 362 32 12,266
Corporate bonds and obligations 8,921,431 620,327 36,786 9,504,972
Mortgage-backed securities 2,259,701 42,684 9,688 2,292,697
$11,257,591 $667,292 $46,506 $11,878,377
Gross Gross
Amortized Unrealized Unrealized Fair
Available for sale Cost Gains Losses Value
U.S. Government agency
obligations $ 84,082 $ 3,248 $ 50 $ 87,280
State and municipal obligations 11,020 1,476 -- 12,496
Corporate bonds and obligations 2,514,308 186,596 3,451 2,697,453
Mortgage-backed securities 7,536,726 206,288 24,031 7,718,983
Total fixed maturities 10,146,136 397,608 27,532 10,516,212
Equity securities 3,156 361 -- 3,517
$10,149,292 $397,969 $27,532 $10,519,729
</TABLE>
The amortized cost, gross unrealized gains and losses and fair
values of investments in fixed maturities and equity securities at
Dec. 31, 1994 are as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Held to maturity Cost Gains Losses Value
<S> <C> <C> <C> <C>
U.S. Government agency
obligations $ 21,500 $ 43 $ 4,372 $ 17,171
State and municipal obligations 9,687 132 -- 9,819
Corporate bonds and obligations 8,806,707 100,468 459,568 8,447,607
Mortgage-backed securities 2,431,967 10,630 222,394 2,220,203
$11,269,861 $111,273 $686,334 $10,694,800
Gross Gross
Amortized Unrealized Unrealized Fair
Available for sale Cost Gains Losses Value
U.S. Government agency
obligations $ 128,093 $ 756 $ 1,517 $ 127,332
State and municipal obligations 11,008 702 -- 11,710
Corporate bonds and obligations 1,142,321 24,166 7,478 1,159,009
Mortgage-backed securities 7,177,706 9,514 467,716 6,719,504
Total fixed maturities 8,459,128 35,138 476,711 8,017,555
Equity securities 4,663 -- 2,757 1,906
$8,463,791 $ 35,138 $479,468 $ 8,019,461
</TABLE>
The amortized cost and fair value of investments in fixed
maturities at Dec. 31, 1995 by contractual maturity are shown
below. Expected maturities will differ from contractual maturities
because borrowers may have the right to call or prepay obligations
with or without call or prepayment penalties.
<PAGE>
PAGE 47
2. Investments (continued)
Amortized Fair
Held to maturity Cost Value
Due in one year or less $ 268,363 $ 272,808
Due from one to five years 1,692,030 1,783,047
Due from five to ten years 5,467,302 5,833,309
Due in more than ten years 1,570,195 1,696,516
Mortgage-backed securities 2,259,701 2,292,697
$11,257,591 $11,878,377
Amortized Fair
Available for sale Cost Value
Due in one year or less $ 118,996 $ 120,019
Due from one to five years 849,800 913,175
Due from five to ten years 1,301,191 1,397,237
Due in more than ten years 339,423 366,798
Mortgage-backed securities 7,536,726 7,718,983
$10,146,136 $10,516,212
During the year ended Dec. 31, 1995, fixed maturities classified as
held to maturity were sold with proceeds of $332,154 and gross
realized gains and losses on such sales were $14,366 and $15,720,
respectively. The sale of these fixed maturities was due to
significant deterioration in the issuers' creditworthiness. As a
result of adopting the FASB Special Report, "A Guide to
Implementation of Statement 115 on Accounting for Certain
Investments in Debt and Equity Securities," the Company
reclassified securities with a book value of $91,760 and net
unrealized gains of $881 from held to maturity to available for
sale in December 1995.
In addition, fixed maturities available for sale were sold during
1995 with proceeds of $136,825 and gross realized gains and losses
on such sales were $nil and $5,781, respectively.
During the year ended Dec. 31, 1994, fixed maturities classified as
held to maturity were sold with proceeds of $58,001 and gross
realized gains and losses on such sales were $226 and $3,515,
respectively. The sale of these fixed maturities was due to
significant deterioration in the issuers' creditworthiness.
In addition, fixed maturities available for sale were sold during
1994 with proceeds of $374,564 and gross realized gains and losses
on such sales were $1,861 and $7,602, respectively.
At Dec. 31, 1995, bonds carried at $12,761 were on deposit with
various states as required by law.
Net investment income for the years ended Dec. 31 is summarized as
follows:
<PAGE>
PAGE 48
2. Investments (continued)
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Interest on fixed maturities $1,656,136 $1,556,756 $1,589,802
Interest on mortgage loans 232,827 196,521 175,063
Other investment income 35,936 38,366 29,345
Interest on cash equivalents 5,363 6,872 2,137
1,930,262 1,798,515 1,796,347
Less investment expenses 22,953 16,642 13,128
$1,907,309 $1,781,873 $1,783,219
</TABLE>
At Dec. 31, 1995, investments in fixed maturities comprised 86
percent of the Company's total invested assets. These securities
are rated by Moody's and Standard & Poor's (S&P), except for
securities carried at approximately $2.3 billion which are rated by
American Express Financial Corporation internal analysts using
criteria similar to Moody's and S&P. A summary of investments in
fixed maturities, at amortized cost, by rating on Dec. 31 is as
follows:
Rating 1995 1994
Aaa/AAA $ 9,907,664 $ 9,708,047
Aaa/AA 3,112 --
Aa/AA 279,403 242,914
Aa/A 154,846 119,952
A/A 3,104,122 2,567,947
A/BBB 871,782 725,755
Baa/BBB 4,417,654 3,849,188
Baa/BB 657,633 796,063
Below investment grade 2,007,511 1,719,123
$21,403,727 $19,728,989
At Dec. 31, 1995, 95 percent of the securities rated Aaa/AAA are
GNMA, FNMA and FHLMC mortgage-backed securities. No holdings of
any other issuer are greater than 1 percent of the Company's total
investments in fixed maturities.
At Dec. 31, 1995, approximately 11.6 percent of the Company's
invested assets were mortgage loans on real estate. Summaries of
mortgage loans by region of the United States and by type of real
estate at Dec. 31, 1995 and 1994 are as follows:
<TABLE>
<CAPTION>
Dec. 31, 1995 Dec. 31, 1994
On Balance Commitments On Balance Commitments
Region Sheet to Purchase Sheet to Purchase
<S> <C> <C> <C> <C>
East North Central $ 720,185 $ 67,206 $ 581,142 $ 62,291
West North Central 303,113 34,411 257,996 7,590
South Atlantic 732,529 111,967 597,896 63,010
Middle Atlantic 508,634 37,079 408,940 34,478
New England 244,816 40,452 209,867 23,087
Pacific 168,272 23,161 138,900 --
West South Central 61,860 27,978 50,854 --
East South Central 58,462 10,122 67,503 --
Mountain 184,964 16,774 122,668 18,750
2,982,835 369,150 2,435,766 209,206
Less allowance
for losses 37,340 -- 35,252 --
$2,945,495 $369,150 $2,400,514 $209,206
<PAGE>
PAGE 49
2. Investments (continued)
Dec. 31, 1995 Dec. 31, 1994
On Balance Commitments On Balance Commitments
Property type Sheet to Purchase Sheet to Purchase
Apartments $1,038,446 $ 84,978 $ 904,012 $ 56,964
Department/retail stores 985,660 134,538 802,522 88,325
Office buildings 464,381 62,664 321,761 21,691
Industrial buildings 255,469 22,721 232,962 18,827
Nursing/retirement homes 80,864 4,378 89,304 4,649
Mixed Use 53,169 -- -- --
Hotels/motels 31,335 48,816 32,666 --
Medical buildings 57,772 2,495 36,490 15,651
Other 15,739 8,560 16,049 3,099
2,982,835 369,150 2,435,766 209,206
Less allowance
for losses 37,340 -- 35,252 --
$2,945,495 $369,150 $2,400,514 $209,206
</TABLE>
Mortgage loan fundings are restricted by state insurance regulatory
authorities to 80 percent or less of the market value of the real
estate at the time of origination of the loan. The Company holds
the mortgage document, which gives the right to take possession of
the property if the borrower fails to perform according to the
terms of the agreement. The fair value of the mortgage loans is
determined by a discounted cash flow analysis using mortgage
interest rates currently offered for mortgages of similar
maturities. Commitments to purchase mortgages are made in the
ordinary course of business. The fair value of the mortgage
commitments is $nil.
As of January 1, 1995, the Company adopted Statement of Financial
Accounting Standards No. 114, "Accounting by Creditors for
Impairment of a Loan" (SFAS No. 114), as amended by Statement of
Financial Accounting Standards No. 118, "Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosures".
The adoption of the new rules did not have a material impact on the
Company's results of operations or financial condition.
SFAS No. 114 applies to all loans except for smaller-balance
homogeneous loans, that are collectively evaluated for impairment.
Impairment is measured as the excess of the loan's recorded
investment over its present value of expected principal and
interest payments discounted at the loan's effective interest rate,
or the fair value of collateral. The amount of the impairment is
recorded as a reserve for investment losses.
Based on management's judgment as to the ultimate collectibility of
principal, interest payments received are either recognized as
income or applied to the recorded investment in the loan until it
has been recovered. Once the recorded investment has been
recovered, any additional payments are recognized as interest
income.
The reserve for investment losses is maintained at a level that
management believes is adequate to absorb estimated credit losses
in the portfolio. The level of the reserve account is determined
based on several factors, including historical experience, expected
future principal and interest payments, estimated collateral
values, and current and anticipated economic and political
conditions. Management regularly evaluates the adequacy of the
reserve for investment losses.
<PAGE>
PAGE 50
2. Investments (continued)
At Dec. 31, 1995, the Company's recorded investment in impaired
loans was $83,874 with a reserve of $19,307. During the year, the
average recorded investment in impaired loans was $74,567.
The Company recognized $5,014 of interest income related to
impaired loans for the year ended Dec. 31, 1995.
The following table presents changes in the reserve for investment
losses related to all loans:
1995
Balance, January 1 $35,252
Provision for investment losses 15,900
Sales of related loans (6,600)
Loan payoffs (5,300)
Other (1,912)
Balance, Dec. 31 $37,340
At Dec. 31, 1995, the Company had commitments to purchase real
estate investments for $54,897. Commitments to purchase real
estate investments are made in the ordinary course of
business. The fair value of these commitments is $nil.
3. Income taxes
The Company qualifies as a life insurance company for federal
income tax purposes. As such, the Company is subject to the
Internal Revenue Code provisions applicable to life insurance
companies.
Income tax expense consists of the following:
1995 1994 1993
Federal income taxes:
Current $218,040 $186,508 $180,558
Deferred (33,810) (19,175) (44,237)
184,230 167,333 136,321
State income taxes-current 11,612 9,010 6,326
Income tax expense $195,842 $176,343 $142,647
Increases (decreases) to the federal tax provision applicable to
pretax income based on the statutory rate are attributable to:
<PAGE>
PAGE 51
3. Income taxes (continued)
<TABLE>
<CAPTION>
1995 1994 1993
Provision Rate Provision Rate Provision Rate
<S> <C> <C> <C> <C> <C> <C>
Federal income
taxes based on
the statutory rate $196,274 35.0% $179,379 35.0% $144,454 35.0%
Increases (decreases)
are attributable to:
Tax-excluded interest
and dividend income (8,524) (1.5) (9,939) (2.0) (11,002) (2.7)
Other, net (3,520) (0.6) (2,107) (0.4) 2,869 0.7
Federal income taxes $184,230 32.9% $167,333 32.6% $136,321 33.0%
</TABLE>
A portion of life insurance company income earned prior to 1984 was
not subject to current taxation but was accumulated, for tax
purposes, in a policyholders' surplus account. At Dec. 31, 1995,
the Company had a policyholders' surplus account balance of
$20,114. The policyholder's surplus account balance increased in
1995 due to the acquisition of ACLAC. The policyholders' surplus
account is only taxable if dividends to the stockholder exceed the
stockholder's surplus account or if the Company is liquidated.
Deferred income taxes of $7,040 have not been established because
no distributions of such amounts are contemplated.
Significant components of the Company's deferred tax assets and
liabilities as of Dec. 31 are as follows:
1995 1994
Deferred tax assets:
Policy reserves $ 600,176 $533,433
Investments -- 116,736
Life insurance guarantee
fund assessment reserve 26,785 32,235
Total deferred tax assets 626,961 682,404
Deferred tax liabilities:
Derred policy acquisition costs 590,762 553,722
Investments 146,805 --
Other 2,298 4,621
Total deferred tax
liabilities 739,865 558,343
Net deferred tax assets
(liabilities) $(112,904) $124,061
The Company is required to establish a valuation allowance for any
portion of the deferred tax assets that management believes will
not be realized. In the opinion of management, it is more
likely than not that the Company will realize the benefit of the
deferred tax assets, and, therefore, no such valuation allowance
has been established.
<PAGE>
PAGE 52
4. Stockholder's equity
During 1995, the Company received a $39,700 capital contribution
from its parent, American Express Financial Corporation, in the
form of investments in fixed maturities and mortgage loans. In
addition, effective January 1, 1995, the Company began
consolidating the financial results of ACLAC. This change
reflected the transfer of ownership of ACLAC from Amex Life
Assurance Company (Amex Life), a former affiliate, to the Company
prior to the sale of Amex Life to an unaffiliated third party on
October 2, 1995. This transfer of ownership to the Company has
been reflected as a capital contribution of $17,114 in the
accompanying financial statements. The effect of this change in
reporting entity was not significant and prior periods have not
been restated.
As discussed in Note 5, the Company entered into a reinsurance
agreement with Amex Life during 1995. As a result of this
transaction, a loss of $4,574 was realized and reported as a
direct charge to retained earnings.
Retained earnings available for distribution as dividends to the
parent are limited to the Company's surplus as determined in
accordance with accounting practices prescribed by state
insurance regulatory authorities. Statutory unassigned surplus
aggregated $1,103,993 as of Dec. 31, 1995 and $1,020,981 as of Dec.
31, 1994 (see Note 3 with respect to the income tax effect of
certain distributions). In addition, any dividend distributions in
1996 in excess of approximately $290,988 would require approval of
the Department of Commerce of the State of Minnesota.
Statutory net income for the years ended Dec. 31 and capital and
surplus as of Dec. 31 are summarized as follows:
1995 1994 1993
Statutory net income $ 326,799 $ 294,699 $ 275,015
Statutory capital and surplus 1,398,649 1,261,958 1,157,022
Dividends paid to American Express Financial Corporation were
$180,000 in 1995, $165,000 in 1994, and $25,000 in 1993.
5. Related party transactions
The Company has loaned funds to American Express Financial
Corporation under two loan agreements. The balance of the first
loan was $25,800 and $40,000 at Dec. 31, 1995 and 1994,
respectively. This loan can be increased to a maximum of $75,000
and pays interest at a rate equal to the preceding month's
effective new money rate for the Company's permanent investments.
It is collateralized by equities valued at $122,978 at Dec. 31,
1995. The second loan was used to fund the construction of the IDS
Operations Center. This loan was paid off during 1994. The loan
was secured by a first lien on the IDS Operations Center property
and had an interest rate of 9.89 percent. The Company also had a
loan to an affiliate which was used to fund construction of the IDS
Learning Center. This loan was sold to the American Express
<PAGE>
PAGE 53
5. Related party transactions (continued)
Financial Corporation during 1994. The loan was secured by a first
lien on the IDS Learning Center property and had an interest rate
of 9.82 percent. Interest income on the above loans totaled
$1,371, $2,894 and $11,116 in 1995, 1994 and 1993, respectively.
The Company purchased a five year secured note from an affiliated
company which had an outstanding balance of $19,444 and $23,333 at
Dec. 31, 1995 and 1994, respectively. The note bears a fixed rate
of 8.42 percent. Interest income on the above note totaled $1,937,
$2,278 and $2,605 in 1995, 1994 and 1993, respectively.
The Company has a reinsurance agreement whereby it assumed 100
percent of a block of single premium life insurance business from
Amex Life. The accompanying consolidated balance sheets at Dec.
31, 1995 and 1994 include $764,663 and $765,366, respectively, of
future policy benefits related to this agreement.
The Company has a reinsurance agreement to cede 50 percent of its
long-term care insurance business to Amex Life. The accompanying
consolidated balance sheets at Dec. 31, 1995 and 1994 include
$95,484 and $65,123, respectively, of reinsurance receivables
related to this agreement. Premiums ceded amounted to $25,553,
$20,360 and $16,230 and reinsurance recovered from reinsurers
amounted to $760, $62 and $404 for the years ended Dec. 31, 1995,
1994 and 1993, respectively.
The Company has a reinsurance agreement to assume deferred annuity
contracts from Amex Life. At October 1, 1995 a $803,618 block of
deferred annuities and $28,327 of deferred policy acquisition costs
were transferred to the Company. The accompanying consolidated
balance sheet at Dec. 31, 1995 includes $828,298 of future policy
benefits related to this agreement.
Until July 1, 1995 the Company participated in the IDS Retirement
Plan of American Express Financial Corporation which covered all
permanent employees age 21 and over who had met certain employment
requirements. Effective July 1, 1995, the IDS Retirement Plan was
merged with American Express Company's American Express Retirement
Plan, which simultaneously was amended to include a cash balance
formula and a lump sum distribution option. Employer contributions
to the plan are based on participants' age, years of service
and total compensation for the year. Funding of retirement costs
for this plan complies with the applicable minimum funding
requirements specified by ERISA. The Company's share of the total
net periodic pension cost was $nil in 1995, 1994 and 1993.
The Company also participates in defined contribution pension plans
of American Express Company which cover all employees who have met
certain employment requirements. Company contributions to the
plans are a percent of either each employee's eligible compensation
or basic contributions. Costs of these plans charged to operations
in 1995, 1994 and 1993 were $815, $957 and $2,008, respectively.
<PAGE>
PAGE 54
5. Related party transactions (continued)
The Company participates in defined benefit health care plans of
American Express Financial Corporation that provide health care and
life insurance benefits to retired employees and retired financial
advisors. The plans include participant contributions and service
related eligibility requirements. Upon retirement, such employees
are considered to have been employees of American Express Financial
Corporation. American Express Financial Corporation expenses these
benefits and allocates the expenses to its subsidiaries.
Accordingly, costs of such benefits to the Company are included in
employee compensation and benefits and cannot be identified on a
separate company basis. At Dec. 31, 1995 and 1994, the total
accumulated post retirement benefit obligation has been recorded as
a liability by American Express Financial Corporation.
Charges by American Express Financial Corporation for use of joint
facilities, marketing services and other services aggregated
$377,139, $335,183, and $243,346 for 1995, 1994 and 1993,
respectively. Certain of these costs are included in deferred
policy acquisition costs. In addition, the Company rents its home
office space from American Express Financial Corporation on an
annual renewable basis.
6. Commitments and contingencies
At Dec. 31, 1995 and 1994, traditional life insurance and universal
life-type insurance in force aggregated $59,683,532 and
$52,666,567, respectively, of which $3,771,204 and $3,246,608
were reinsured at the respective year ends. The Company also
reinsures a portion of the risks assumed under disability income
policies. Under the agreements, premiums ceded to reinsurers
amounted to $29,146, $29,489 and $28,276 and reinsurance recovered
from reinsurers amounted to $5,756, $5,505, and $3,345 for the
years ended Dec. 31, 1995, 1994 and 1993.
Reinsurance contracts do not relieve the Company from its primary
obligation to policyholders.
The Company is a defendant in various lawsuits, none of which, in
the opinion of Company counsel, will result in a material
liability.
The IRS has completed its audit of the Company's 1987 through 1989
tax years. The Company is currently contesting one issue at the
IRS Appeals Level. Management does not believe there will be a
material impact as a result of this audit.
7. Lines of credit
The Company has available lines of credit with three banks
aggregating $100,000 at 40 to 80 basis points over the banks' cost
of funds or equal to the prime rate, depending on which line of
credit agreement is used. Borrowings outstanding under these
agreements were $nil at Dec. 31, 1995 and 1994, respectively.
<PAGE>
PAGE 55
8. Derivative financial instruments
The Company enters into transactions involving derivative financial
instruments to manage its exposure to interest rate risk, including
hedging specific transactions. The Company manages risks
associated with these instruments as described below. The Company
does not hold derivative instruments for trading purposes.
Market risk is the possibility that the value of the derivative
financial instruments will change due to fluctuations in a factor
from which the instrument derives its value, primarily an interest
rate. The Company is not impacted by market risk related to
derivatives held for non-trading purposes beyond that inherent in
cash market transactions. Derivatives held for purposes other than
trading are largely used to manage risk and, therefore, the cash
flow and income effects of the derivatives are inverse to the
effects of the underlying transactions.
Credit risk is the possibility that the counterparty will not
fulfill the terms of the contract. The Company monitors credit
exposure related to derivative financial instruments through
established approval procedures, including setting concentration
limits by counterparty and industry, and requiring collateral,
where appropriate. A vast majority of the Company's counterparties
are rated A or better by Moody's and Standard & Poor's.
The notional or contract amount of a derivative financial
instrument is generally used to calculate the cash flows that are
received or paid over the life of the agreement. Notional
amounts are not recorded on the balance sheet. Notional amounts
far exceed the related credit exposure.
Credit exposure related to interest rate caps is measured by the
replacement cost of the contracts. The replacement cost
represents the fair value of the instruments. Financial futures
contracts are settled in cash daily.
<TABLE>
<CAPTION>
Notional Carrying Fair Total Credit
Dec. 31, 1995 Amount Value Value Exposure
<S> <C> <C> <C> <C>
Assets:
Interest rate caps $5,100,000 $26,680 $ 8,366 $ 8,366
Dec. 31, 1994
Assets:
Financial futures
contracts $ 159,800 $ 2,072 $ 2,072 $ --
Interest rate caps 4,400,000 29,054 42,365 42,365
$4,559,800 $31,126 $44,437 $42,365
</TABLE>
The fair values of derivative financial instruments are based on
market values, dealer quotes or pricing models. The financial
futures contracts expired in 1995. The interest rate caps expire
on various dates from 1996 to 2000.
<PAGE>
PAGE 56
8. Derivative financial instruments (continued)
Financial futures contracts and interest rate caps are used
principally to manage the Company's exposure to rising interest
rates. These instruments are used primarily to protect the margin
between interest rates earned on investments and the interest rates
credited to related annuity contract holders.
Changes in the fair value of financial futures contracts are
accounted for as adjustments to the carrying amount of the hedged
investments and amortized over the remaining lives of such
investments. The cost of interest rate caps is amortized to
interest expense over the life of the contracts and payments
received as a result of these agreements are recorded as a
reduction of interest expense when realized. The amortized cost of
interest rate cap contracts is included in other investments.
9. Fair values of financial instruments
The Company discloses fair value information for most on- and
off-balance sheet financial instruments for which it is practical
to estimate that value. Fair values of life insurance obligations,
receivables and all non-financial instruments, such as deferred
acquisition costs are excluded. Off-balance sheet intangible
assets, such as the value of the field force, are also excluded.
Management believes the value of excluded assets is significant.
The fair value of the Company, therefore, cannot be estimated by
aggregating the amounts presented.
<TABLE>
<CAPTION>
1995 1994
Carrying Fair Carrying Fair
Financial Assets Value Value Value Value
<S> <C> <C> <C> <C>
Investments:
Fixed maturities (Note 2):
Held to maturity $11,257,591 $11,878,377 $11,269,861 $10,694,800
Available for sale 10,516,212 10,516,212 8,017,555 8,017,555
Mortgage loans on
real estate (Note 2) 2,945,495 3,184,666 2,400,514 2,342,520
Other:
Equity securities (Note 2) 3,517 3,517 1,906 1,906
Derivative financial
instruments (Note 8) 26,680 8,366 31,126 44,437
Other 52,182 52,182 -- --
Cash and cash
equivalents (Note 1) 72,147 72,147 267,774 267,774
Separate account assets
(Note 1) 14,974,082 14,974,082 10,881,235 10,881,235
Financial Liabilities
Future policy benefits
for fixed annuities 20,259,265 19,603,114 18,325,870 17,651,897
Separate account
liabilities 14,208,619 13,665,636 10,398,861 9,943,672
</TABLE>
At Dec. 31, 1995 and 1994, the carrying amount and fair value of
future policy benefits for fixed annuities exclude life
insurance-related contracts carried at $1,070,598 and $971,897,
respectively, and policy loans of $74,973 and $64,212,
respectively. The fair value of these benefits is based on the
status of the annuities at Dec. 31, 1995 and 1994. The fair value
of deferred annuities is estimated as the carrying amount less any
<PAGE>
PAGE 57
9. Fair values of financial instruments (continued)
applicable surrender charges and related loans. The fair value for
annuities in non-life contingent payout status is estimated as the
present value of projected benefit payments at rates appropriate
for contracts issued in 1995 and 1994.
At Dec. 31, 1995 and 1994, the fair value of liabilities related to
separate accounts is estimated as the carrying amount less any
applicable surrender charges and less variable insurance contracts
carried at $765,463 and $482,374, respectively.
10. Segment information
The Company's operations consist of two business segments; first,
individual and group life insurance, disability income, health and
long-term care insurance, and second, annuity products designed for
individuals, pension plans, small businesses and employer-sponsored
groups. The consolidated condensed statements of income for the
years ended Dec. 31, 1995, 1994 and 1993 and total assets at Dec.
31, 1995, 1994 and 1993 by segment are summarized as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Net investment income:
Life, disability income, health
and long-term care insurance $ 256,242 $ 247,047 $ 250,224
Annuities 1,651,067 1,534,826 1,532,995
$ 1,907,309 $ 1,781,873 $ 1,783,219
Premiums, charges and fees:
Life, disability income, health
and long-term care insurance $ 384,008 $ 335,375 $ 287,713
Annuities 249,557 193,370 143,876
$ 633,565 $ 528,745 $ 431,589
Income before income taxes:
Life, disability income, health
and long-term care insurance $ 125,402 $ 122,677 $ 104,127
Annuities 440,278 394,117 315,336
Net loss on investments (4,898) (4,282) (6,737)
$ 560,782 $ 512,512 $ 412,726
Total assets:
Life, disability income, health
and long-term care insurance $ 6,195,870 $ 5,269,188 $ 4,810,145
Annuities 36,704,208 30,478,355 28,247,608
$42,900,078 $35,747,543 $33,057,753
</TABLE>
Allocations of net investment income and certain general expenses
are based on various assumptions and estimates.
Assets are not individually identifiable by segment and have been
allocated principally based on the amount of future policy benefits
by segment.
Capital expenditures and depreciation expense are not material, and
consequently, are not reported.
<PAGE>
PAGE 58
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company
We have audited the accompanying consolidated balance sheets of IDS
Life Insurance Company (a wholly owned subsidiary of American
Express Financial Corporation) as of December 31, 1995 and 1994,
and the related consolidated statements of income, stockholder's
equity and cash flows for each of the three years in the period
ended December 31, 1995. These financial statements are the
responsibility of the Company'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 consolidated financial
position of IDS Life Insurance Company at December 31, 1995 and
1994, and the consolidated results of its operations and its cash
flows for each of the three years in the period ended December 31,
1995, in conformity with generally accepted accounting principles.
As discussed in Note 1 to the consolidated financial statements,
the Company changed its method of accounting for certain
investments in debt and equity securities in 1994.
Ernst & Young LLP
February 2, 1996
Minneapolis, Minnesota
<PAGE>
PAGE 59
PART II. OTHER INFORMATION
Item 1. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
List of financial statements filed as part of this Post-
Effective Amendment to the Registration Statement.
Financial statements included in the prospectus, Part I:
IDS Life Insurance Company:
Consolidated Balance Sheets as of December 31, 1995,
and December 31, 1994.
Consolidated Statements of Income for the years ended
December 31, 1995, 1994 and 1993.
Consolidated Statements of Stockholder's Equity for the
years ended December 31, 1995, 1994 and 1993.
Consolidated Statements of Cash Flows for the years
ended December 31, 1995, 1994 and 1993.
Notes to Consolidated Financial Statements.
Report of Independent Auditors dated February 2, 1996.
Exhibits to Financial Statements included in Part II:
IDS Life Insurance Company Schedules I, III, IV and V as
required by Regulation S-X.
(b) Exhibits
(1) Resolution of the Executive Committee of the Board of
Directors of Investors Syndicate Life Insurance and Annuity
Company dated May 10, 1968, filed as Exhibit 1 to
Registrant's Registration Statement No. 2-29081 filed on May
16, 1968, and refiled electronically April 27, 1994 as
Exhibit 1 with Post-effective Amendment No. 56, is
incorporated herein by reference.
(2) Regulations of IDS Life Variable Annuity Fund A as Amended
and Restated, dated June 22, 1979, filed as Exhibit 2 to
Registrant's Post-Effective Amendment No. 32 to Registration
Statement No. 2-29081 filed on December 10, 1979, and refiled
electronically on or about April 11, 1995 are incorporated
herein by reference.
(3) Not applicable.
(4) Contracts filed as Exhibit 4 to Registrant's Post-Effective
Amendment No. 32 to Registration Statement No. 2-29081 filed
on December 10, 1979, are incorporated herein by reference.
<PAGE>
PAGE 60
(5) (a) Investment Advisory Agreement between IDS Life
Insurance Company and IDS/American Express dated
January 12, 1984, filed as Exhibit 5(a) to Registrant's
Post-Effective Amendment No. 44, and refiled
electronically April 27, 1994 as Exhibit 5(a) with
Post-Effective Amendment No. 56, is incorporated herein
by reference.
(b) Investment Management and Advisory Agreements between
IDS Life Insurance Company and IDS Life Variable
Annuity Fund A dated January 12, 1984, filed as Exhibit
5(b) to Registrant's Post-Effective Amendment No. 44,
and refiled electronically April 27, 1994 as Exhibit
5(b) with Post-Effective Amendment No. 56, are
incorporated herein by reference.
(6) Distribution and Services Agreement between Registrant and
IDS Life Insurance Company, dated January 12, 1984, filed as
Exhibit 6 to Registrant's Post-Effective Amendment No. 44,
and refiled electronically April 27, 1994 as Exhibit 6 with
Post Effective Amendment No. 56, is incorporated herein by
reference.
(7) None.
(8) (a) Custodian Agreement between Registrant, IDS Life
Insurance Company, and American Express Bank & Trust,
dated July 12, 1990, filed as Exhibit 8(a) to
Registrant's Post-Effective Amendment No. 53 to this
Registration Statement, filed April 15, 1991, and
refiled electronically April 27, 1994 as Exhibit 8(a)
with Post-Effective Amendment No. 56, is incorporated
herein by reference.
(8) (b) Custody Agreement between Morgan Stanley Trust Company
and IDS Bank & Trust dated May, 1993 filed
electronically on or about April 11, 1995 as Exhibit
No. 8(b) to Post-Effective Amendment No. 58 is
incorporated herein by reference.
(9) Not applicable.
(10) Opinion and Consent of Counsel as to the legality of the
securities registered was filed with Registrant's 24f-2
Notice.
(11) Consent of Independent Auditors is filed electronically
herewith.
(12) Financial statement schedules omitted from Item 17 of Part I:
Schedule I - Consolidated Summary of Investments
Other than Investments in Related
Parties
Schedule III - Supplementary Insurance Information
<PAGE>
PAGE 61
Schedule IV - Reinsurance
Schedule V - Valuation and Qualifying Accounts
Report of Independent Auditors, dated February 2, 1996, on
IDS Life Insurance Company financial statement schedules.
(13) through (15) not applicable.
(16) Financial Data Schedule is filed electronically herewith.
(17)(a) IDS Life Insurance Company Power of Attorney to sign
Amendments to this Registration Statement, dated April
1, 1996 is filed electronically herewith as Exhibit
17(a).
(17)(b) Board of Managers Power of Attorney to sign Amendments
to this Registration Statement, dated February 9, 1995,
filed electronically on or about April 11, 1995 as
Exhibit 17(b) to Post-Effective Amendment No. 58 is
incorporated herein by reference.
Item 2. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT
Both the Registrant and IDS Life Variable Annuity Fund B are
separate accounts of IDS Life. Consequently, the securities and
funds of the Registrant and Fund B are technically those of IDS
Life, even though the securities and funds of the two Funds are
maintained as separate accounts under Minnesota Law pursuant to a
safekeeping agreement with American Express Bank & Trust. As
separate Accounts, Minnesota Law provides that the assets of the
Funds are not chargeable with liabilities arising out of any other
business of IDS Life and are held for the exclusive benefit of
owners of variable annuity contracts based on the Funds.
Item 3. NUMBER OF HOLDERS OF SECURITIES
Number of Record Holders
Title of Class as of March 31, 1996
Variable Annuities 11,378
Item 4. INDEMNIFICATION
The Regulations of the Registrant provide that each member of
the Board of Managers and each Officer of the Fund shall be
indemnified by IDS Life, of which the Fund is a separate account,
for reasonable costs and expenses actually and necessarily incurred
in defense of any action, suit or proceedings where the defendant
is a party by reason of being a Manager or Officer. No
indemnification will be forthcoming in the event of an adjudication
of willful misfeasance, bad faith, gross negligence or reckless
disregard by the Officer or Manager of the duties of his office.
In the absence of an adjudication expressly absolving the Office or
Manager of the afore-detailed wrongful conduct, indemnification may
still be advanced should 2/3 of the members of the Board of
Directors of IDS Life who were not involved in the processing
resolve there was no instance of such wrongful conduct. In the
instance of such a resolution, the indemnification claim still must
<PAGE>
PAGE 62
be found to be reasonable in amount and proper in presentation by
independent counsel of IDS Life. Should any proceeding be settled,
indemnification shall not exceed the costs, fees and expenses which
would have been incurred had the proceeding been litigated. The
payment of indemnification by IDS Life will not prevent a variable
contract holder from challenging the payment by appropriate legal
action on the basis that the payment was improper because of
willful misfeasance, bad faith, gross negligence or reckless
disregard by an Officer or Manager of his duties.
The By-Laws of the Registrant's investment management
underwriter, IDS Life, also contains an indemnification clause.
The clause provides that IDS Life shall indemnify any person who
was or is a party or is threatened to be made a party, by reason of
the fact that he is or was a Manager of Variable Annuity Funds A
and B, director, officer, employee or agent of IDS Life, or is or
was serving at the direction of IDS Life as a Manager of Variable
Annuity Funds A and B, Director, Officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, to any threatened, pending or completed action, suit or
proceeding, wherever brought, to the fullest extent permitted by
the laws of the State of Minnesota, as now existing or hereafter
amended, provided that this Article shall not indemnify or protect
any such Manager of Variable Annuity Funds A and B, Director,
Officer, employee or agent against any liability to IDS Life or its
security holders to which he would otherwise be subject by reason
of willful misfeasance, bad faith, or gross negligence, in the
performance of his duties or by reason of his reckless disregard of
his obligations and duties.
At the time of the filing of the Registration Statement of the
Registrant, IDS Life included the following undertaking with regard
to the foregoing indemnification procedures:
"Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant
to the foregoing provision, or otherwise ISL [si__. IDS
Life] has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against
public policy as expressed in the Act, and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment of ISL
[si__. IDS Life] of expenses incurred or paid by a director,
officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, ISL [si__.
IDS Life] will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed
in the Act and will be governed by the final adjudication of
such issue."
<PAGE>
PAGE 63
<TABLE><CAPTION>
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)
Directors and officers of American Express Financial Corporation who are directors and/or
officers of one or more other companies:
Ronald G. Abrahamson, Vice President--Service Quality and Reengineering
<S> <C> <C>
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Service Quality
and Reengineering
Douglas A. Alger, Vice President--Total Compensation
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Total Compensation
Peter J. Anderson, Director and Senior Vice President--Investments
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Investments
IDS Advisory Group Inc. Director and Chairman
of the Board
IDS Capital Holdings Inc. Director and President
IDS International, Inc. Director, Chairman of the
Board and Executive Vice
President
IDS Securities Corporation Executive Vice President-
Investments
NCM Capital Management Group, Inc. 2 Mutual Plaza Director
501 Willard Street
Durham, NC 27701
Ward D. Armstrong, Vice President-Sales and Marketing, American Express Institutional Services
American Express Financial Advisors IDS Tower 10 Vice President-Sales and
Minneapolis, MN 55440 Marketing, American
Express Institutional
Services
Joseph M. Barsky III, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-Senior
Minneapolis, MN 55440 Portfolio Manager
IDS Advisory Group Inc. Vice President
Robert C. Basten, Vice President--Tax and Business Services
American Express Financial Advisors IDS Tower 10 Vice President-Tax
Minneapolis, MN 55440 and Business Services
American Express Tax & Business Director, President and
Services Inc. Chief Executive Officer
<PAGE>
PAGE 64
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Timothy V. Bechtold, Vice President--Risk Management Products
American Express Financial Advisors IDS Tower 10 Vice President-Risk
Minneapolis, MN 55440 Management Products
IDS Life Insurance Company Vice President-Risk
Management Products
Carl E. Beihl, Vice President--Strategic Technology Planning
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Strategic Technology
Planning
Alan F. Bignall, Vice President--Technology and Development
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Technology and
Development
John C. Boeder, Vice President--Mature Market Group
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Mature Market Group
IDS Life Insurance Company of New York Box 5144 Director
Albany, NY 12205
Karl J. Breyer, Director, Senior Vice President--Corporate Affairs and General Counsel
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Corporate Affairs and
Special Counsel
American Express Minnesota Foundation Director
IDS Aircraft Services Corporation Director and President
Daniel J. Candura, Vice President--Marketing Support
American Express Financial Advisors IDS Tower 10 Vice President-Marketing
Minneapolis, MN 55440 Support
Cynthia M. Carlson, Vice President--American Express Securities Services
American Enterprise Investment IDS Tower 10 Director, President and
Services Inc. Minneapolis, MN 55440 Chief Executive Officer
American Express Financial Advisors Vice President-American
Express Securities Services
Orison Y. Chaffee III, Vice President--Field Real Estate
American Express Financial Advisors IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Real Estate
<PAGE>
PAGE 65
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
James E. Choat, Director and Senior Vice President--Field Management
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Field Management
American Express Insurance Agency of Nevada Inc. Vice President--North
Central Region
American Express Minnesota Foundation Director
IDS Insurance Agency of Alabama Inc. Vice President--North
Central Region
IDS Insurance Agency of Arkansas Inc. Vice President--North
Central Region
IDS Insurance Agency of Massachusetts Inc. Vice President--North
Central Region
IDS Insurance Agency of New Mexico Inc. Vice President--North
Central Region
IDS Insurance Agency of North Carolina Inc. Vice President--North
Central Region
IDS Insurance Agency of Ohio Inc. Vice President--North
Central Region
IDS Insurance Agency of Wyoming Inc. Vice President-- North
Central Region
Kenneth J. Ciak, Vice President and General Manager--IDS Property Casualty
AMEX Assurance Co. Director and President
American Express Financial Advisors IDS Tower 10 Vice President and General
Minneapolis, MN 55440 Manager-IDS Property
Casualty
IDS Property Casualty Insurance Co. 1400 Lombardi Ave. Director and President
Green Bay, WI 54344
Colleen Curran, Vice President and Assistant General Counsel
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
American Express Service Corporation Vice President and Chief
Legal Counsel
Alan R. Dakay, Vice President--Institutional Products Group
American Centurion Life Assurance Co. IDS Tower 10 Director and Vice Chairman
Minneapolis, MN 55440 and President, Financial
Institutions Division
American Enterprise Life Insurance Co. Director and President
IDS Life Insurance Company Vice President -
Institutional Insurance
Marketing
American Express Financial Advisors Vice President -
Institutional Products
Group
Regenia David, Vice President--Systems Services
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Systems Services
<PAGE>
PAGE 66
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
William H. Dudley, Director and Executive Vice President--Investment Operations
American Express Financial Advisors IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-
Investment Operations
IDS Advisory Group Inc. Director
IDS Capital Holdings Inc. Director
IDS Futures Corporation Director
IDS Futures III Corporation Director
IDS International, Inc. Director
IDS Securities Corporation Director, Chairman of the
Board, President and
Chief Executive Officer
Gordon L. Eid, Director, Senior Vice President and Deputy General Counsel
American Express Financial Advisors IDS Tower 10 Senior Vice President and
Minneapolis, MN 55440 General Counsel
American Express Insurance Agency of Nevada Inc. Director and Vice President
IDS Insurance Agency of Alabama Inc. Director and Vice President
IDS Insurance Agency of Arkansas Inc. Director and Vice President
IDS Insurance Agency of Massachusetts Inc. Director and Vice President
IDS Insurance Agency of New Mexico Inc. Director and Vice President
IDS Insurance Agency of North Carolina Inc. Director and Vice President
IDS Insurance Agency of Ohio Inc. Director and Vice President
IDS Insurance Agency of Wyoming Inc. Director and Vice President
IDS Real Estate Services, Inc. Vice President
Investors Syndicate Development Corp. Director
Robert M. Elconin, Vice President--Government Relations
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Government Relations
IDS Life Insurance Company Vice President
Mark A. Ernst, Vice President--Retail Services
American Enterprise Investment IDS Tower 10 Director
Services Inc. Minneapolis, MN 55440
American Express Financial Advisors Vice President-
Retail Services
American Express Tax & Business Director and Chairman of
Services Inc. the Board
Gordon M. Fines, Vice President--Mutual Fund Equity Investments
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Mutual Fund Equity
Investments
IDS Advisory Group Inc. Executive Vice President
Robert G. Gilbert, Vice President--Real Estate
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Real Estate
<PAGE>
PAGE 67
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
John J. Golden, Vice President--Field Compensation Development
American Express Financial Advisors IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Compensation Development
Harvey Golub, Director
American Express Company American Express Tower Chairman and Chief
World Financial Center Executive Officer
New York, New York 10285
American Express Travel Chairman and Chief
Related Services Company, Inc. Executive Officer
Morris Goodwin Jr., Vice President and Corporate Treasurer
American Centurion Life Assurance Co. Vice President and
Treasurer
American Enterprise Investment IDS Tower 10 Vice President and
Services Inc. Minneapolis, MN 55440 Treasurer
American Enterprise Life Insurance Vice President and
Company Treasurer
American Express Financial Advisors Vice President and
Corporate Treasurer
American Express Insurance Agency of Nevada Inc. Vice President and
Treasurer
American Express Minnesota Foundation Vice President and
Treasurer
American Express Tax & Business Vice President and
Services Inc. Treasurer
American Partners Life Insurance Co. Vice President and
Treasurer
AMEX Assurance Co. Vice President and
Treasurer
IDS Advisory Group Inc. Vice President and
Treasurer
IDS Aircraft Services Corporation Vice President and
Treasurer
IDS Cable Corporation Director, Vice President
and Treasurer
IDS Cable II Corporation Director, Vice President
and Treasurer
IDS Capital Holdings Inc. Vice President and
Treasurer
IDS Certificate Company Vice President and
Treasurer
IDS Deposit Corp. Director, President
and Treasurer
IDS Futures Corp. Director
IDS Futures III Corp. Director
IDS Insurance Agency of Alabama Inc. Vice President and
Treasurer
IDS Insurance Agency of Arkansas Inc. Vice President and
Treasurer
IDS Insurance Agency of Massachusetts Inc. Vice President and
Treasurer
<PAGE>
PAGE 68
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
IDS Insurance Agency of New Mexico Inc. Vice President and
Treasurer
IDS Insurance Agency of North Carolina Inc. Vice President and
Treasurer
IDS Insurance Agency of Ohio Inc. Vice President and
Treasurer
IDS Insurance Agency of Wyoming Inc. Vice President and
Treasurer
IDS International, Inc. Vice President and
Treasurer
IDS Life Insurance Company Vice President and
Treasurer
IDS Life Series Fund, Inc. Vice President and
Treasurer
IDS Life Variable Annuity Funds A&B Vice President and
Treasurer
IDS Management Corporation Director, Vice President
and Treasurer
IDS Partnership Services Corporation Director, Vice President
and Treasurer
IDS Plan Services of California, Inc. Vice President and
Treasurer
IDS Property Casualty Insurance Co. Vice President and
Treasurer
IDS Real Estate Services, Inc Vice President and
Treasurer
IDS Realty Corporation Director, Vice President
and Treasurer
IDS Sales Support Inc. Director, Vice President
and Treasurer
IDS Securities Corporation Vice President and
Treasurer
Investors Syndicate Development Corp. Vice President and
Treasurer
National Computer Systems, Inc. 11000 Prairie Lakes Drive Director
Minneapolis, MN 55440
NCM Capital Management Group, Inc. 2 Mutual Plaza Director
501 Willard Street
Durham, NC 27701
Sloan Financial Group, Inc. Director
Suzanne Graf, Vice President--Systems Services
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Systems Services
David A. Hammer, Vice President and Marketing Controller
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Marketing Controller
IDS Plan Services of California, Inc. Director and Vice President
<PAGE>
PAGE 69
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Lorraine R. Hart, Vice President--Insurance Investments
American Enterprise Life IDS Tower 10 Vice President-Investments
Insurance Company Minneapolis, MN 55440
American Express Financial Advisors Vice President-Insurance
Investments
American Partners Life Insurance Co. Director and Vice
President-Investments
AMEX Assurance Co. Vice President-Investments
IDS Certificate Company Vice President-Investments
IDS Life Insurance Company Vice President-Investments
IDS Life Series Fund, Inc. Vice President-Investments
IDS Life Variable Annuity Funds A and B Vice President-Investments
IDS Property Casualty Insurance Company Vice President-Investment
Officer
Investors Syndicate Development Corp. Director and Vice
President-Investments
Scott A. Hawkinson, Vice President--Assured Assets Product Development and Management
American Express Financial Advisors IDS Tower 10 Vice President-Assured
Minneapolis, MN 55440 Assets Product
Development & Management
James G. Hirsh, Vice President and Assistant General Counsel
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
IDS Securities Corporation Director, Vice President
and General Counsel
Darryl G. Horsman, Vice President--Product Development and Technology, American Express
Institutional Retirement Services
American Express Trust Company IDS Tower 10 Director and President
Minneapolis, MN 55440
Kevin P. Howe, Vice President--Government and Customer Relations and Chief Compliance Officer
American Enterprise Investment IDS Tower 10 Vice President and Chief
Services Inc. Minneapolis, MN 55440 Compliance Officer
American Express Financial Advisors Vice President-
Government and
Customer Relations
American Express Service Corporation Vice President and Chief
Compliance Officer
IDS Securities Corporation Vice President and Chief
Compliance Officer
David R. Hubers, Director, President and Chief Executive Officer
American Express Financial Advisors IDS Tower 10 Chairman, Chief Executive
Minneapolis, MN 55440 Officer and President
American Express Service Corporation Director and Executive Vice
President
<PAGE>
PAGE 70
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
AMEX Assurance Co. Director
IDS Aircraft Services Corporation Director
IDS Certificate Company Director
IDS Life Insurance Company Director
IDS Plan Services of California, Inc. Director and President
IDS Property Casualty Insurance Co. Director
Marietta L. Johns, Director and Senior Vice President--Field Management
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Field Management
James E. Kaare, Vice President--Marketing Promotions
American Express Financial Advisors IDS Tower 10 Vice President-Marketing
Minneapolis, MN 55440 Promotions
Linda B. Keene, Vice President--Market Development
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Market Development
G. Michael Kennedy, Vice President--Investment Services and Investment Research
American Express Financial Advisors IDS Tower 10 Vice President-Investment
Minneapolis, MN 55440 Services and Investment
Research
Susan D. Kinder, Director and Senior Vice President--Human Resources
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Human Resources
American Express Minnesota Foundation Director
Richard W. Kling, Director and Senior Vice President--Risk Management Products
American Centurion Life Assurance Co. Director
American Enterprise Life Insurance Co. IDS Tower 10 Director and Chairman of
Minneapolis, MN 55440 the Board
American Express Financial Advisors Senior Vice President-
Risk Management Products
American Express Insurance Agency of Nevada Inc. Director and President
American Express Service Corporation Vice President
American Partners Life Insurance Co. Director and Chairman of
the Board
AMEX Assurance Co. Director and Chairman of
the Board
IDS Certificate Company Director and Chairman of
the Board
IDS Insurance Agency of Alabama Inc. Director and President
IDS Insurance Agency of Arkansas Inc. Director and President
IDS Insurance Agency of Massachusetts Inc. Director and President
IDS Insurance Agency of New Mexico Inc. Director and President
IDS Insurance Agency of North Carolina Inc. Director and President
IDS Insurance Agency of Ohio Inc. Director and President<PAGE>
PAGE 71
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
IDS Insurance Agency of Wyoming Inc. Director and President
IDS Life Insurance Company Director and President
IDS Life Series Fund, Inc. Director and President
IDS Life Variable Annuity Funds A and B Director and Chairman of
the Board and President
IDS Property Casualty Insurance Co. Director and Chairman of
the Board
IDS Life Insurance Company P.O. Box 5144 Director, Chairman of the
of New York Albany, NY 12205 Board and President
Paul F. Kolkman, Vice President--Actuarial Finance
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Actuarial Finance
IDS Life Insurance Company Director and Executive
Vice President
IDS Life Series Fund, Inc. Vice President and Chief
Actuary
IDS Property Casualty Insurance Company Director
Claire Kolmodin, Vice President--Service Quality
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Service Quality
Steven C. Kumagai, Director and Senior Vice President--Field Management and Business Systems
American Express Financial Advisors IDS Tower 10 Director and Senior Vice
Minneapolis, MN 55440 President-Field
Management and Business
Systems
Edward Labenski, Jr., Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio
Manager
IDS Advisory Group Inc. Senior Vice President
Kurt A. Larson, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio Manager
Lori J. Larson, Vice President--Variable Assets Product Development
American Express Financial Advisors IDS Tower 10 Vice President-Variable
Minneapolis, MN 55440 Assets Product
Development
IDS Cable Corporation Director and Vice President
IDS Cable II Corporation Director and Vice President
IDS Futures Brokerage Group Assistant Vice President-
General Manager/Director
IDS Futures Corporation Director and Vice President
IDS Futures III Corporation Director and Vice President
IDS Management Corporation Director and Vice President<PAGE>
PAGE 72
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
IDS Partnership Services Corporation Director and Vice President
IDS Realty Corporation Director and Vice President
Ryan R. Larson, Vice President--IPG Product Development
American Centurion Life Assurance Co. Director and
Vice President-Product
Development
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 IPG Product Development
IDS Life Insurance Company Vice President-
Annuity Product
Development
Daniel E. Laufenberg, Vice President and Chief U.S. Economist
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Chief U.S. Economist
Richard J. Lazarchic, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-Senior
Minneapolis, MN 55440 Portfolio Manager
Peter A. Lefferts, Director and Senior Vice President--Corporate Strategy and Development
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Corporate Strategy and
Development
American Express Trust Company Director
IDS Plan Services of California, Inc. Director
Investors Syndicate Development Corp. Director
Douglas A. Lennick, Director and Executive Vice President--Private Client Group
American Express Financial Advisors IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President-Private
Client Group
Jonathan S. Linen, Director
Mary J. Malevich, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio
Manager
Fred A. Mandell, Vice President--Field Marketing Readiness
American Express Financial Advisors IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Marketing Readiness
<PAGE>
PAGE 73
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
William J. McKinney, Vice President--Field Management Support
American Express Financial Advisors IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Management Support
Thomas W. Medcalf, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-Senior
Minneapolis, MN 55440 Portfolio Manager
William C. Melton, Vice President-International Research and Chief International Economist
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 International Research
and Chief International
Economist
Janis E. Miller, Vice President--Variable Assets
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Variable Assets
IDS Cable Corporation Director and President
IDS Cable II Corporation Director and President
IDS Futures Corporation Director and President
IDS Futures III Corporation Director and President
IDS Life Insurance Company Director and Executive
Vice President-Variable
Assets
IDS Life Series Fund, Inc. Director
IDS Life Variable Annuity Funds A&B Director
IDS Management Corporation Director and President
IDS Partnership Services Corporation Director and President
IDS Realty Corporation Director and President
IDS Life Insurance Company of New York Box 5144 Executive Vice President
Albany, NY 12205
James A. Mitchell, Director and Executive Vice President--Marketing and Products
American Enterprise Investment IDS Tower 10 Director
Services Inc. Minneapolis, MN 55440
American Express Financial Advisors Executive Vice President-
Marketing and Products
American Express Service Corporation Senior Vice President
American Express Tax and Business Director
Services Inc.
AMEX Assurance Co. Director
IDS Certificate Company Director
IDS Life Insurance Company Director, Chairman of
the Board and Chief
Executive Officer
IDS Plan Services of California, Inc. Director
IDS Property Casualty Insurance Co. Director
<PAGE>
PAGE 74
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Pamela J. Moret, Vice President--Services
American Express Financial Advisors IDS Tower 10 Vice President-Services
Minneapolis, MN 55440
American Express Minnesota Foundation Director and President
Barry J. Murphy, Director and Senior Vice President--Client Service
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Client Service
IDS Life Insurance Company Director and Executive
Vice President-Client
Service
Mary Owens Neal, Vice President--Mature Market Segment
American Express Financial Advisors Inc. IDS Tower 10 Vice President-
Minneapolis, MN 55440 Mature Market Segment
Robert J. Neis, Vice President--Technology Services
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Technology Services
James R. Palmer, Vice President--Taxes
American Express Financial Advisors IDS Tower 10 Vice President-Taxes
Minneapolis, MN 55440
IDS Aircraft Services Corp. Vice President
IDS Life Insurance Company Vice President-Taxes
Carla P. Pavone, Vice President--Specialty Service Teams and Emerging Business
American Express Financial Advisors IDS Tower 10 Vice President-Specialty
Minneapolis, MN 55440 Service Teams and
Emerging Business
Susan B. Plimpton, Vice President--Segmentation Development and Support
American Express Financial Advisors IDS Tower 10 Vice President--
Minneapolis, MN 55440 Segmentation Development
and Support
Ronald W. Powell, Vice President and Assistant General Counsel
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
IDS Cable Corporation Vice President and
Assistant Secretary
IDS Cable II Corporation Vice President and
Assistant Secretary
IDS Management Corporation Vice President and
Assistant Secretary
IDS Partnership Services Corporation Vice President and
Assistant Secretary<PAGE>
PAGE 75
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
IDS Plan Services of California, Inc. Vice President and
Assistant Secretary
IDS Realty Corporation Vice President and
Assistant Secretary
James M. Punch, Vice President--Geographic Service Teams
American Express Financial Advisors IDS Tower 10 Vice President-Geographic
Minneapolis, MN 55440 Services Teams
Frederick C. Quirsfeld, Vice President--Taxable Mutual Fund Investments
American Express Financial Advisors IDS Tower 10 Vice President--
Minneapolis, MN 55440 Taxable Mutual Fund
Investments
IDS Advisory Group Inc. Vice President
ReBecca K. Roloff, Vice President--Private Client Group
American Express Financial Advisors IDS Tower 10 Vice President-Private
Minneapolis, MN 55440 Client Group
Stephen W. Roszell, Vice President--Advisory Institutional Marketing
American Express Financial Advisors IDS Tower 10 Vice President-Advisory
Minneapolis, MN 55440 Institutional Marketing
IDS Advisory Group Inc. President and Chief
Executive Officer
IDS International, Inc. Director
IDS Fund Management Limited Director
Robert A. Rudell, Vice President--American Express Institutional Retirement Services
American Express Financial Advisors IDS Tower 10 Vice President-American
Minneapolis, MN 55440 Express Institutional
Services
American Express Trust Company Director and Chairman of
the Board
IDS Sales Support Inc. Director and President
John P. Ryan, Vice President and General Auditor
American Express Financial Advisors IDS Tower 10 Vice President and General
Minneapolis, MN 55440 Auditor
Erven A. Samsel, Director and Senior Vice President--Field Management
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Field Management
American Express Insurance Agency of Nevada Inc. Vice President-
New England Region
IDS Insurance Agency of Alabama Inc. Vice President-
New England Region
IDS Insurance Agency of Arkansas Inc. Vice President-
New England Region
<PAGE>
PAGE 76
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
IDS Insurance Agency of Massachusetts Inc. Vice President-
New England Region
IDS Insurance Agency of New Mexico Inc. Vice President-
New England Region
IDS Insurance Agency of North Carolina Inc. Vice President-
New England Region
IDS Insurance Agency of Ohio Inc. Vice President-
New England Region
IDS Insurance Agency of Wyoming Inc. Vice President-
New England Region
Stuart A. Sedlacek, Vice President--Assured Assets
American Centurion Life Assurance Co. Director and Chairman
and President
American Enterprise Life Insurance Co. IDS Tower 10 Director and Executive
Minneapolis, MN 55440 Vice President, Assured
Assets
American Express Financial Advisors Vice President-
Assured Assets
American Partners Life Insurance Co. Director and President
IDS Certificate Company Director and President
IDS Life Insurance Company Director and Executive
Vice President, Assured
Assets
Investors Syndicate Development Corp. Director and Chairman of
the Board and President
Donald K. Shanks, Vice President--Property Casualty
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Property Casualty
IDS Property Casualty Insurance Co. Senior Vice President
F. Dale Simmons, Vice President--Senior Portfolio Manager, Insurance Investments
American Enterprise Life Insurance Co. IDS Tower 10 Vice President-Real
Minneapolis, MN 55440 Estate Loan Management
American Express Financial Advisors Vice President-Senior
Portfolio Manager,
Insurance Investments
American Partners Life Insurance Co. Vice President-Real
Estate Loan Management
AMEX Assurance Co. Vice President
IDS Certificate Company Vice President-Real
Estate Loan Management
IDS Life Insurance Company Vice President-Real
Estate Loan Management
IDS Partnership Services Corporation Vice President
IDS Real Estate Services Inc. Director and Vice President
IDS Realty Corporation Vice President
IDS Life Insurance Company of New York Box 5144 Vice President and
Albany, NY 12205 Assistant Treasurer
<PAGE>
PAGE 77
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Judy P. Skoglund, Vice President--Human Resources and Organization Development
American Express Financial Advisors IDS Tower 10 Vice President-Human
Minneapolis, MN 55440 Resources and
Organization Development
Ben C. Smith, Vice President--Workplace Marketing
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Workplace Marketing
William A. Smith, Vice President and Controller--Private Client Group
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Controller-Private
Client Group
Bridget Sperl, Vice President--Human Resources Management Services
American Express Financial Advisors IDS Tower 10 Vice President-Human
Minneapolis, MN 55440 Resources Management
Services
William A. Stoltzmann, Vice President and Assistant General Counsel
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
American Partners Life Insurance Co. Director, Vice President,
General Counsel and
Secretary
IDS Life Insurance Company Vice President, General
Counsel and Secretary
American Enterprise Life Insurance P.O. Box 534 Director, Vice President,
Company Minneapolis, MN 55440 General Counsel
and Secretary
James J. Strauss, Vice President--Corporate Planning and Analysis
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Corporate Planning and
Analysis
Jeffrey J. Stremcha, Vice President--Information Resource Management/ISD
American Express Financial Advisors IDS Tower 10 Vice President-Information
Minneapolis, MN 55440 Resource Management/ISD
John R. Thomas, Director and Senior Vice President--Information and Technology
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Information and
Technology
<PAGE>
PAGE 78
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Melinda S. Urion, Director, Senior Vice President and Chief Financial Officer
American Enterprise Life IDS Tower 10 Vice President and
Insurance Company Minneapolis, MN 55440 Controller
American Express Financial Advisors Senior Vice President and
Chief Financial Officer
American Express Trust Company Director
American Partners Life Insurance Co. Director and Vice President
IDS Life Insurance Company Director, Executive Vice
President and Controller
IDS Life Series Fund, Inc. Vice President and
Controller
Wesley W. Wadman, Vice President--Senior Portfolio Manager
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Senior Portfolio Manager
IDS Advisory Group Inc. Executive Vice President
IDS Fund Management Limited Director and Vice Chairman
IDS International, Inc. Senior Vice President
Norman Weaver Jr., Director and Senior Vice President--Field Management
American Express Financial Advisors IDS Tower 10 Senior Vice President--
Minneapolis, MN 55440 Field Management
American Express Insurance Agency of Nevada Inc. Vice President-Southeast
Region
IDS Insurance Agency of Alabama Inc. Vice President-Pacific
Region
IDS Insurance Agency of Arkansas Inc. Vice President-Pacific
Region
IDS Insurance Agency of Massachusetts Inc. Vice President-Pacific
Region
IDS Insurance Agency of New Mexico Inc. Vice President-Pacific
Region
IDS Insurance Agency of North Carolina Inc. Vice President-Pacific
Region
IDS Insurance Agency of Ohio Inc. Vice President-Pacific
Region
IDS Insurance Agency of Wyoming Inc. Vice President-Pacific
Region
Michael L. Weiner, Vice President--Tax Research and Audit
American Express Financial Advisors IDS Tower 10 Vice President-Tax Research
Minneapolis, MN 55440 and Audit
American Express Service Corporation Assistant Treasurer
IDS Capital Holdings Inc. Vice President
IDS Futures Brokerage Group Vice President
IDS Futures Corporation Vice President, Treasurer
and Secretary
IDS Futures III Corporation Vice President, Treasurer
and Secretary
<PAGE>
PAGE 79
Item 5. Business and Other Connections of Investment Adviser (American Express Financial
Corporation)(cont'd)
Lawrence J. Welte, Vice President--Investment Administration
American Express Financial Advisors IDS Tower 10 Vice President-
Minneapolis, MN 55440 Investment Administration
IDS Securities Corporation Director, Executive Vice
President and Chief
Operating Officer
Jeffry F. Welter, Vice President--Equity and Fixed Income Trading
American Express Financial Advisors IDS Tower 10 Vice President-Equity
Minneapolis, MN 55440 and Fixed Income Trading
William N. Westhoff, Director, Senior Vice President and Global Chief Investment Officer
American Enterprise Life Insurance IDS Tower 10 Director
Company Minneapolis, MN 55440
American Express Financial Advisors Senior Vice President and
Global Chief Investment
Officer
IDS Fund Management Limited Director
IDS International, Inc. Director
IDS Partnership Services Corporation Director and Vice President
IDS Real Estate Services Inc. Director, Chairman of the
Board and President
IDS Realty Corporation Director and Vice President
Investors Syndicate Development Corp. Director
Edwin M. Wistrand, Vice President and Assistant General Counsel
American Express Financial Advisors IDS Tower 10 Vice President and
Minneapolis, MN 55440 Assistant General Counsel
Michael R. Woodward, Director and Senior Vice President--Field Management
American Express Financial Advisors IDS Tower 10 Senior Vice President-
Minneapolis, MN 55440 Field Management
American Express Insurance Agency of Nevada Inc. Vice President-
North Region
IDS Insurance Agency of Alabama Inc. Vice President-
North Region
IDS Insurance Agency of Arkansas Inc. Vice President-
North Region
IDS Insurance Agency of Massachusetts Inc. Vice President-
North Region
IDS Insurance Agency of New Mexico Inc. Vice President-
North Region
IDS Insurance Agency of North Carolina Inc. Vice President-
North Region
IDS Insurance Agency of Ohio Inc. Vice President-
North Region
IDS Insurance Agency of Wyoming Inc. Vice President-
North Region
IDS Life Insurance Company Box 5144 Director
of New York Albany, NY 12205
/TABLE
<PAGE>
PAGE 80
PART II. OTHER INFORMATION (Continued)
Item 6. PRINCIPAL UNDERWRITERS
(a) IDS Life is the Principal underwriter for IDS Life
Variable Annuity Fund A, IDS Life Variable Annuity
Fund B, IDS Life Accounts F, IZ, JZ, G, H, and N,
IDS Life Account RE, IDS Life Account MGA and IDS
Life Account SBS.
Item 6(b). Principal Underwriter (IDS Life Insurance Company)
<TABLE><CAPTION>
Name and Principal Position and Offices Positions and Offices
Business Address with Underwriter with Registrant
<S> <C> <C>
Timothy V. Bechtold Vice President-Risk None
IDS Tower 10 Management Products
Minneapolis, MN 55440
David J. Berry Vice President None
IDS Tower 10
Minneapolis, MN 55440
Alan R. Dakay Vice President- None
IDS Tower 10 Institutional Insurance
Minneapolis, MN 55440 Marketing
Robert M. Elconin Vice President None
IDS Tower 10
Minneapolis, MN 55440
Morris Goodwin Jr. Vice President and Treasurer Vice President and
IDS Tower 10 Treasurer
Minneapolis, MN 55440
Lorraine R. Hart Vice President-Investments Vice President,
IDS Tower 10 Investments
Minneapolis, MN 55440
David R. Hubers Director None
IDS Tower 10
Minneapolis, MN 55440
James M. Jensen Vice President-Insurance None
IDS Tower 10 Product Development
Minneapolis, MN 55440
Richard W. Kling Director and President Chairman of the
IDS Tower 10 Board of Managers
Minneapolis, MN 55440 and President
Paul F. Kolkman Director and Executive None
IDS Tower 10 Vice President
Minneapolis, MN 55440
Ryan R. Larson Vice President None
IDS Tower 10
Minneapolis, MN 55440
<PAGE>
PAGE 81
Item 6(b). Principal Underwriter (IDS Life Insurance Company)(cont'd)
Name and Principal Position and Offices Positions and Offices
Business Address with Underwriter with Registrant
Janis E. Miller Director and Executive Member of the Board
IDS Tower 10 Vice President- of Managers
Minneapolis, MN 55440 Variable Assets
James A. Mitchell Director, Chairman of None
IDS Tower 10 the Board and Chief
Minneapolis, MN 55440 Executive Officer
Barry J. Murphy Director and Executive None
IDS Tower 10 Vice President-
Minneapolis, MN 55440 Client Service
James R. Palmer Vice President-Taxes None
IDS Tower 10
Minneapolis, MN 55440
Stuart A. Sedlacek Director and Executive None
IDS Tower 10 Vice President-Assured
Minneapolis, MN 55440 Assets
F. Dale Simmons Vice President- None
IDS Tower 10 Real Estate
Minneapolis, MN 55440 Loan Management
William A. Stoltzmann Vice President, General General Counsel and
IDS Tower 10 Counsel and Secretary Assistant Secretary
Minneapolis, MN 55440
Melinda S. Urion Director, Executive None
IDS Tower 10 Vice President and
Minneapolis, MN 55440 Controller
</TABLE>
Item 7. LOCATION OF ACCOUNTS AND RECORDS
IDS Life Insurance Company
IDS Tower
Minneapolis, Minnesota
Item 8. MANAGEMENT SERVICES
Not Applicable.
<PAGE>
PAGE 82
Item 9. DISTRIBUTION EXPENSES
Not Applicable.
Item 10. UNDERTAKINGS
(a) and (b) These undertakings were filed in Registrant's
initial Registration Statement.
<PAGE>
PAGE 83
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant IDS Life Variable
Annuity Fund A, certifies that it meets all of the requirements for
effectiveness of this Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this
Amendment to its Registration Statement to be signed on its behalf
by the undersigned thereunto duly authorized, in the city of
Minneapolis, and State of Minnesota on the 23rd day of April, 1996.
IDS LIFE VARIABLE ANNUITY FUND A
By: /s/ Richard W. Kling**
Richard W. Kling**
Chairman of the Board
of Managers
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by
the following persons in the capacities indicated on the 23rd day
of April, 1996.
Signature Title
/s/ Edward Landes** Member, Board of Managers
Edward Landes
/s/ Carl N. Platou** Member, Board of Managers
Carl N. Platou
/s/ Gordon H. Ritz** Member, Board of Managers
Gordon H. Ritz
/s/ R. W. Kling** Chairman of the Board
Richard W. Kling of Managers
/s/ Janis E. Miller** Member, Board of Managers
Janis E. Miller
Vice President, Investments
Lorraine R. Hart
Secretary
Timothy S. Meehan
/s/ Morris Goodwin Jr.** Vice President and Treasurer
Morris Goodwin Jr.
/s/ William A. Stoltzmann** General Counsel and
William A. Stoltzmann Assistant Secretary
<PAGE>
PAGE 84
** Signed pursuant to IDS Life Variable Annuity Fund A Board of
Managers Power of Attorney filed electronically on April 11, 1995
as Exhibit 17(b) to this Registration Statement No. 29081.
by
Mary Ellyn Minenko
<PAGE>
PAGE 85
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, IDS Life Insurance Company, on
behalf of the Registrant, certifies that it meets all of the
requirements for effectiveness of this Amendment to its
Registration Statement pursuant to Rule 485(b) under the Securities
Act of 1933 and has duly caused this Amendment to its Registration
Statement to be signed on its behalf by the undersigned thereunto
duly authorized, in the city of Minneapolis, and State of Minnesota
on the 23rd day of April, 1996.
IDS LIFE INSURANCE COMPANY
By: /s/ Richard W. Kling*
Richard W. Kling
President
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by
the following persons in the capacities indicated on the 23rd day
of April, 1996.
Signature Title
/s/ James A. Mitchell* Chairman of the Board
James A. Mitchell and Chief Executive
Officer
/s/ Richard W. Kling* Director and President
Richard W. Kling
/s/ David R. Hubers* Director
David R. Hubers
/s/ Paul F. Kolkman* Director and Executive Vice
Paul F. Kolkman President
/s/ Janis E. Miller* Director and Executive Vice
Janis E. Miller President, Variable Assets
/s/ Barry J. Murphy* Director and Executive Vice
Barry J. Murphy President, Client Service
/s/ Stuart A. Sedlacek* Director and Executive Vice
Stuart A. Sedlacek President, Assured Assets
/s/ Melinda S. Urion* Director, Executive Vice
Melinda S. Urion President and Controller
<PAGE>
PAGE 86
* Signed pursuant to Power of Attorney, dated April 1, 1996, filed
electronically herewith as Exhibit 17(a).
by
Mary Ellyn Minenko
<PAGE>
PAGE 87
CONTENTS OF THIS
POST-EFFECTIVE AMENDMENT NO. 59
TO REGISTRATION STATEMENT NO. 2-29081
This Post-Effective Amendment comprises the following papers and
documents.
The facing sheet.
Part I.
Cross Reference Sheet.
Prospectus.
Part II.
Other Information.
Signatures.
<PAGE>
PAGE 1
EXHIBIT INDEX
IDS Life Variable Annuity Fund A
Registration No. 2-29081/811-1653
Exhibit 11 Consent of Independent Auditors.
Exhibit 12 Financial Statement Schedules and Report of
Independent Auditors, dated February 3, 1995.
Exhibit 16 Financial Data Schedule.
<PAGE>
PAGE 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our reports dated February 2, 1996 on the
financial statements and schedules of IDS Life Insurance Company
and the incorporation by reference of our report dated February 1,
1996 on the financial statements of IDS Life Variable Annuity Fund
A in Post-Effective Amendment No. 59 to the Registration Statement
(Form N-1, No. 2-29081) and related Prospectus for the registration
of IDS Life Variable Account Fund A interests to be offered by IDS
Life Insurance Company.
ERNST & YOUNG LLP
Minneapolis, Minnesota
April 23, 1996
OF INDEPENDENT AUDITORS
<PAGE>
PAGE 1
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE I - CONSOLIDATED SUMMARY OF INVESTMENTS
OTHER THAN INVESTMENTS IN RELATED PARTIES ($ thousands)
AS OF DECEMBER 31, 1995
Column A Column B Column C Column D
Type of Investment Cost Value Amount at which
shown in the
balance sheet
<S> <C> <C> <C>
Fixed maturities:
Held to maturity:
United States Government and
government agencies and
authorities (a) $ 1,237,093 $ 1,253,115 $ 1,237,093
States, municipalities and
political subdivisions 11,936 12,266 11,936
All other corporate bonds 10,008,562 10,612,996 10,008,562
Total held to maturity 11,257,591 11,878,377 11,257,591
Available for sale:
United States Government and
government agencies and
authorities (b) 4,092,563 4,176,080 4,176,080
States, municipalities and
political subdivisions 11,020 12,496 12,496
All other corporate bonds 6,042,553 6,327,636 6,327,636
Total available for sale 10,146,136 10,516,212 10,516,212
Mortgage loans on real estate 2,945,495 XXXXXXXXX 2,945,495
Policy loans 424,019 XXXXXXXXX 424,019
Other investments 146,894 XXXXXXXXX 146,894
Total investments $24,920,135 $ XXXXXXXXX $25,290,211
(a) - Includes mortgage-backed securities with a cost and market value of $1,172,570 and
$1,184,673, respectively.
(b) - Includes mortgage-backed securities with a cost and market value of $4,008,481 and
$4,088,800, respectively.
</TABLE>
<PAGE>
PAGE 2
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE III - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1995
Column A Column B Column C Column D Column E Column F Column G
Segment Deferred Future Unearned Other policy Premium Net
policy policy premiums claims and revenue investment
acquisition benefits, benefits income
cost losses, payable
claims and
loss
expenses
<S> <C> <C> <C> <C> <C> <C>
Annuities $1,227,169 $21,404,836 $ - $28,191 $ - $1,651,067
Life, DI,
Long-term Care and
Health Insurance 798,556 3,613,253 - 28,132 161,530 256,242
Total $2,025,725 $25,018,089 $ - $56,323 $161,530 $1,907,309
Column H Column I Column J Column K
Benefits, Amortization Other Premiums
claims, of deferred operating written
losses and policy expenses
settlement acquisition
expenses costs
Annuities $ 2,693 $ 189,626 $166,191 N/A
Life, DI,
Long-term Care and
Health Insurance 164,749 90,495 45,451 N/A
Total $ 167,442 $ 280,121 $211,642 N/A
</TABLE>
<PAGE>
PAGE 3
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE III - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1994
Column A Column B Column C Column D Column E Column F Column G
Segment Deferred Future Unearned Other policy Premium Net
policy policy premiums claims and revenue investment
acquisition benefits, benefits income
cost losses, payable
claims and
loss
expenses
<S> <C> <C> <C> <C> <C> <C>
Annuities $1,150,585 $19,361,979 $ - $23,888 $ - $1,534,826
Life, DI,
Long-term Care and
Health Insurance 714,739 3,346,931 - 26,180 144,640 247,047
Total $1,865,324 $22,708,910 $ - $50,068 $144,640 $1,781,873
Column H Column I Column J Column K
Benefits, Amortization Other Premiums
claims, of deferred operating written
losses and policy expenses
settlement acquisition
expenses costs
Annuities $ (5,762) $ 194,060 $131,515 N/A
Life, DI,
Long-term Care and
Health Insurance 134,128 86,312 78,586 N/A
Total $ 128,366 $ 280,372 $210,101 N/A
</TABLE>
<PAGE>
PAGE 4
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE III - SUPPLEMENTARY INSURANCE INFORMATION ($ thousands)
FOR THE YEAR ENDED DECEMBER 31, 1993
Column A Column B Column C Column D Column E Column F
Segment Deferred Future Unearned Other policy Premium
policy policy premiums claims and revenue
acquisition benefits, benefits
cost losses, payable
claims and
loss
expenses
<S> <C> <C> <C> <C> <C>
Annuities $1,008,378 $18,492,135 $ - $ 21,508 $ -
Life, DI,
Long-term Care and
Health Insurance 644,006 3,148,932 - 23,008 127,245
Total $1,652,384 $21,641,067 $ - $ 44,516 $127,245
Column G Column H Column I Column J Column K
Net Benefits, Amortization Other Premiums
investment claims, of deferred operating written
income losses and policy expenses
settlement acquisition
expenses costs
Annuities $1,532,995 $ 3,656 $139,602 $122,999 N/A
Life, DI,
Long-term Care and
Health Insurance 250,224 119,335 72,131 118,975 N/A
Total $1,783,219 $ 122,991 $211,733 $241,974 N/A
</TABLE>
<PAGE>
PAGE 5
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE IV - REINSURANCE ($ thousands)
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
Column A Column B Column C Column D Column E Column F
Gross amount Ceded to other Assumed from Net % of amount
companies other companies Amount assumed to net
<S> <C> <C> <C> <C> <C>
For the year ended
December 31, 1995
Life insurance in force $57,895,180 $3,771,204 $1,788,352 $55,912,328 3.20%
Premiums:
Life insurance $ 53,089 $ 2,648 $ (248) $ 50,193 -0.49%
DI & health insurance 137,016 25,679 -- 111,337 0.00%
Total premiums $ 190,105 $ 28,327 $ (248) $ 161,530 -0.15%
For the year ended
December 31, 1994
Life insurance in force $50,814,651 $3,246,608 $1,851,916 $49,419,959 3.75%
Premiums:
Life insurance $ 51,219 $ 3,354 $ 319 $ 48,184 0.66%
DI & health insurance 114,049 17,593 -- 96,456 0.00%
Total premiums $ 165,268 $ 20,947 $ 319 $ 144,640 0.22%
For the year ended
December 31, 1993
Life insurance in force $44,188,493 $3,038,426 $1,937,022 $43,087,089 4.50%
Premiums:
Life insurance $ 51,764 $ 3,627 $ -- $ 48,137 0.00%
DI & health insurance 96,250 17,142 -- 79,108 0.00%
Total premiums $ 148,014 $ 20,769 $ -- $ 127,245 0.00%
</TABLE>
<PAGE>
PAGE 6
<TABLE>
<CAPTION>
IDS LIFE INSURANCE COMPANY
SCHEDULE V - VALUATION AND QUALIFYING ACCOUNTS ($ thousands)
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
Column A Column B Column C Column D Column E
Additions
---------
Balance at Charged to
Description Beginning Charged to Other Accounts- Deductions- Balance at End
of Period Costs & Expenses Describe Describe * of Period
<S> <C> <C> <C> <C> <C>
For the year ended
December 31, 1995
- -------------------------
Reserve for Mortgage Loans $35,252 $ 1,088 $0 ($1,000) $37,340
Reserve for Other Investments $ 7,515 ($ 2,802) $0 $ 0 $ 4,713
For the year ended
December 31, 1994
- -------------------------
Reserve for Mortgage Loans $35,020 $ 232 $0 $ 0 $35,252
Reserve for Fixed Maturities $22,777 ($16,777) $0 $6,000 $ 0
Reserve for Other Investments $10,700 ($ 3,185) $0 $ 0 $ 7,515
For the year ended
December 31, 1993
- -------------------------
Reserve for Mortgage Loans $23,595 $13,635 $0 $2,210 $35,020
Reserve for Fixed Maturities $37,899 ($15,122) $0 $22,777
Reserve for Other Investments $12,834 ($ 4,344) $0 ($2,210) $10,700
* 1995 amount represents a reserve on mortgage loans which were transferred from an affiliate. 1994 amount represents
a direct writedown of the related investments in fixed maturities. 1993 amounts represent transfers between reserve accounts.
</TABLE>
<PAGE>
PAGE 7
Report of Independent Auditors
The Board of Directors
IDS Life Insurance Company
We have audited the consolidated financial statements of IDS Life
Insurance Company as of December 31, 1995 and 1994, and for each of
the three years in the period ended December 31, 1995, and have
issued our report thereon dated February 2, 1996 (included
elsewhere in this Registration Statement).
Our audits also included the financial statement schedules listed
in Item 1(a) of this Registration Statement. These schedules are
the responsibility of the Company's management. Our responsibility
is to express an opinion based on our audits.
In our opinion, the financial statement schedules referred to
above, when considered in relation to the basic financial
statements taken as a whole, present fairly, in all material
respects, the information set forth therein.
Ernst & Young LLP
Minneapolis, Minnesota
February 2, 1996
<PAGE>
[ARTICLE] 7
[CIK] 0000768836
[NAME] IDS Life Insurance Company
[MULTIPLIER] 1000
[CURRENCY] U.S. DOLLAR
[FISCAL-YEAR-END] DEC-31-1994 DEC-31-1995
[PERIOD-START] JAN-01-1994 JAN-01-1995
[PERIOD-END] DEC-31-1994 DEC-31-1995
[PERIOD-TYPE] YEAR YEAR
[EXCHANGE-RATE] 1 1
[DEBT-HELD-FOR-SALE] 8017555 10516212
[DEBT-CARRYING-VALUE] 11269861 11257591
[DEBT-MARKET-VALUE] 10694800 11878377
[EQUITIES] 1906 3517
[MORTGAGE] 2400514 2945495
[REAL-ESTATE] 20835 28796
[TOTAL-INVEST] 22121637 25290211
[CASH] 267774 72147
[RECOVER-REINSURE] 1110 1849
[DEFERRED-ACQUISITION] 1865324 2025725
[TOTAL-ASSETS] 35747543 42900078
[POLICY-LOSSES] 22708910 25018089
[UNEARNED-PREMIUMS] 0 0
[POLICY-OTHER] 0 0
[POLICY-HOLDER-FUNDS] 50068 56323
[NOTES-PAYABLE] 0 0
[COMMON] 3000 3000
[PREFERRED-MANDATORY] 0 0
[PREFERRED] 0 0
[OTHER-SE] 1585691 2328708
[TOTAL-LIABILITY-AND-EQUITY] 35747543 42900078
[PREMIUMS] 144640 161530
[INVESTMENT-INCOME] 1781873 1907309
[INVESTMENT-GAINS] (4282) (4898)
[OTHER-INCOME] 384105 472035
[BENEFITS] 1303351 1483431
[UNDERWRITING-AMORTIZATION] 280372 280121
[UNDERWRITING-OTHER] 210101 211642
[INCOME-PRETAX] 512512 560782
[INCOME-TAX] 176343 195842
[INCOME-CONTINUING] 336169 364940
[DISCONTINUED] 0 0
[EXTRAORDINARY] 0 0
[CHANGES] 0 0
[NET-INCOME] 336169 364940
[EPS-PRIMARY] 0 0
[EPS-DILUTED] 0 0
[RESERVE-OPEN] 20636 23228
[PROVISION-CURRENT] 93683 117478
[PROVISION-PRIOR] 0 0
[PAYMENTS-CURRENT] 91091 116514
[PAYMENTS-PRIOR] 0 0
[RESERVE-CLOSE] 23228 24192
[CUMULATIVE-DEFICIENCY] 0 0
<PAGE>
PAGE 1
IDS LIFE INSURANCE COMPANY
POWER OF ATTORNEY
City of Minneapolis
State of Minnesota
Each of the undersigned, as directors of the below listed unit
investment trusts that previously have filed registration
statements and amendments thereto pursuant to the requirements of
the Securities Act of 1933 and the Investment Company Act of 1940
with the Securities and Exchange Commission:
<TABLE><CAPTION>
1933 Act 1940 Act
Reg. Number Reg. Number
<S> <C> <C>
IDS Life Variable Account 10
IDS Life Flexible Portfolio Annuity 33-62407 811-07355
IDS Life Accounts F, IZ, JZ, G, H, N, KZ, LZ and MZ
IDS Life Flexible Annuity 33-4173 811-3217
IDS Life Accounts F, IZ, JZ, G, H, N, KZ, LZ and MZ
IDS Life Variable and Combination
Retirement Annuities 2-73114 811-3217
IDS Life Accounts F, IZ, JZ, G, H, N, KZ, LZ and MZ
IDS Life Employee Benefit Annuity 33-52518 811-3217
IDS Life Accounts F, IZ, JZ, G, H, N, KZ, LZ and MZ
IDS Life Group Variable Annuity Contract 33-47302 811-3217
IDS Life Insurance Company
IDS Life Group Variable Annuity Contract
(Fixed Account) 33-48701 N/A
IDS Life Insurance Company
IDS Life Single Payment Market Value Annuity 33-28976 N/A
IDS Life Insurance Company
IDS Life Flexible Payment Market Value Annuity 33-50968 N/A
IDS Life Variable Life Separate Account
Flexible Premium Variable Life Insurance Policy 33-11165 811-4298
IDS Life Variable Life Separate Account
IDS Life Single Premium Variable Life 2-97637 811-4298
IDS Life Variable Account for Smith Barney
LifeVest Single Premium Variable Life 33-5210 811-4652
IDS Life Account SBS
IDS Life Symphony Annuity 33-40779 812-7731
IDS Life Account RE
IDS Life Real Estate Variable Annuity 33-13375 N/A
IDS Life Variable Annuity Fund A 2-29081 811-1653
IDS Life Variable Annuity Fund B 2-47430 811-1674
</TABLE>
hereby constitutes and appoints William A. Stoltzmann, Mary Ellyn
Minenko, Eileen J. Newhouse and Timothy S. Meehan or any one of
them, as her or his attorney-in-fact and agent, to sign for her or
him in her or his name, place and stead any and all filings,
applications (including applications for exemptive relief),
periodic reports, registration statements (with all exhibits and
other documents required or desirable in connection therewith)
other documents, and amendments thereto and to file such filings,
applications, periodic reports, registration statements other
<PAGE>
PAGE 2
documents, and amendments thereto with the Securities and Exchange
Commission, and any necessary states, and grants to any or all of
them the full power and authority to do and perform each and every
act required or necessary in connection therewith.
Dated the 1st day of April, 1996.
/s/ David R. Hubers March 21, 1996
David R. Hubers
Director
/s/ Richard W. Kling March 21, 1996
Richard W. Kling
Director and President
/s/ Paul F. Kolkman March 21, 1996
Paul F. Kolkman
Director and Executive Vice
President
/s/ Janis E. Miller March 25, 1996
Janis E. Miller
Director and Executive Vice
President, Variable Assets
/s/ James A. Mitchell March 25, 1996
James A. Mitchell
Director, Chairman of the
Board and Chief Executive Officer
/s/ Barry J. Murphy April 1, 1996
Barry J. Murphy
Director and Executive Vice
President, Client Service
/s/ Stuart A. Sedlacek March 27, 1996
Stuart A. Sedlacek
Director and Executive Vice
President, Assured Assets
/s/ Melinda S. Urion March 29, 1996
Melinda S. Urion
Director, Executive Vice
President and Controller
