IDS Life
Variable
Annuity
Fund A
Invests in a wide range of securities with the objective of long-term capital
appreciation for contract owners.
1998 annual report
Managed by IDS Life Insurance Company
American Express Financial Advisors
<PAGE>
IDSLife Variable Annuity Fund A
Message From the Executive Vice President
If you're an experienced investor, you know that the past 12 months was a highly
volatile period in many financial markets. But history tells us that substantial
market moves are nothing new. Though they're often unpredictable, declines --
whether they're brief or long-lasting, moderate or substantial -- are always a
possibility.
The potential for such volatility reinforces the need for investors to
periodically review their long-term financial goals and examine whether their
investment program remains on track to achieving them. Your quarterly investment
statements are one part of that monitoring process. The other is a meeting with
your American Express financial advisor. That becomes even more important if
there's a major change in your financial situation or in the financial markets.
Pamela J. Moret
(picture of) Pamela J. Moret
Executive Vice President, Variable Assets
IDS Life Insurance Company
<PAGE>
IDS Life Variable Annuity Fund A
From Your Portfolio Manager: A Perspective
It was a roller-coaster year for the U.S. stock market and the Fund. In the end,
though, it also proved to be a very productive one.
On Dec. 31, 1998, the accumulation unit value of IDS Life Variable Annuity Fund
A was $24.53, compared with $20.91 at the beginning of the year. The increase
represented a gain of 17.31% for the 12 months. (If you purchased additional
accumulation units during the period, your return would have been affected by
the sales and administrative charges, as described in the Fund's prospectus.)
The year began on an uncertain note, as investors continued to sort out the
potential impact of the financial crisis that first hit Asian markets in the
fall of 1997. By February, they evidently had decided that the U.S. market would
weather the storm relatively well, and, with support from ongoing reports of
subdued inflation and a growing economy, they sent stocks soaring into the
spring.
The environment changed dramatically in mid-summer, however. By that time, the
"Asian flu" had made its way to Russia and Latin America, re-igniting fear that
American companies' profits would decline as a result of reduced overseas
business. The result was a market decline of nearly 20%. But, with the
remarkable resilience it has shown in recent years, the market staged a furious
comeback during the final three months that more than made up for the downturn.
The Fund's performance roughly tracked that of the broad market over the 12
months. Working in the Fund's favor was the ongoing strength of
large-capitalization growth stocks -- the core of its investment portfolio.
Within that broad category, the Fund's largest area of investment was in
technology-related stocks, which were extremely volatile but, on the whole,
highly productive. Consumer-related stocks, including those of health care
companies and retail chains, constituted another substantial area of investment
and proved to be comparatively consistent, positive performers. Financial
services stocks also provided good overall results for the period, thanks to
declining interest rates. Looking at individual stocks, there were a number of
very strong performers for the Fund. In no particular order, they included
Microsoft, Intel, IBM, MCI WorldCom, Cisco Systems, Pfizer, Travelers and
Tellabs.
As is the norm for this Fund, there was little portfolio turnover during the 12
months -- a reflection of my buy-and-hold management style. Also, I maintained
only a small amount of cash reserves, preferring instead to keep the great
majority of assets working in stocks. While this low-cash strategy makes the
Fund's performance more volatile, I believe it results in a higher return over
the long term.
At this time (mid-January), the stock market continues to draw support from the
favorable factors of tame inflation, low interest rates and ongoing economic
growth. Assuming no major change in those fundamentals, I think the strength of
corporate profits will ultimately be the key to the market's performance in
1999. Therefore, I continue to concentrate investments in stocks of companies
that impress me as having excellent profit potential.
Mitzi Malevich
(picture of) Mitzi Malevich
Mitzi Malevich
Portfolio Manager
<PAGE>
IDS Life Variable Annuity Fund A
The 10 Largest Holdings
Percent Value
(of net (as of
assets) Dec. 31, 1998)
Cisco Systems......................... 6.16% $25,059,374
MCI WorldCom.......................... 5.29 21,525,000
Tellabs............................... 5.05 20,568,750
Microsoft............................. 4.77 19,416,250
Intl Business Machines................ 4.54 18,475,000
Guidant............................... 4.06 16,537,500
Pfizer................................ 3.70 15,052,500
Intel................................. 3.50 14,227,500
Tyco Intl............................. 3.34 13,578,750
Coca-Cola............................. 3.27 13,321,500
For further detail about these holdings, please refer to the section entitled
"Investments in Securities" herein.
(icon of) pie chart
The 10 holdings listed here make up 43.68% of net assets
<PAGE>
IDS Life Variable Annuity Fund A
Investment Illustration
On the chart below you can see how IDS Life Variable Annuity Fund A's total
return compared to the Standard & Poor's 500 Index (S&P 500), an unmanaged list
of common stocks, frequently used as a general measure of market performance. In
comparing the Fund to the S&P 500, you should take into account the fact that
the Fund's performance reflects an 8 percent total sales and administrative
charge, while no such sales charge is reflected in the performance of the S&P
500. Investment performance of the Fund, after charges, is reflected in the unit
value calculation. There are no dividend or capital gain distributions,
therefore, the assumed units purchased would remain constant throughout the
period.
How your $10,000 has grown in IDS Life Variable Annuity Fund A
$9,200 12,015 12,253 18,358 19,638 21,503 20,641 27,984 34,240 42,013 49,305
$4.578 5.979 6.097 9.135 9.772 10.700 10.271 13.925 17.038 20.906 24.534
Dec. 31
Unit Value
The above represents an assumed investment of $10,000 into a single payment
annuity contract on Dec. 31, 1988. Values are calculated on Dec. 31 of each
year. (No new contracts are currently being sold.)
Average Annual Total Return on Each of Three Investments
Date of Period Fund A
investment: investment Annuity
held in years: Value
Dec. 31, 1988 10 +17.30%
Dec. 31, 1993 5 +16.10%
Dec. 31, 1997 1 + 7.97%
The returns reflect the deduction of a sales and administrative charge and
mortality and expense risk charges.
Your investment and return values fluctuate so that your accumulation units,
when redeemed, may be worth more or less than their original cost. This was a
period of fluctuating security prices. Past performance is no guarantee of
future results.
<PAGE>
IDS Life Variable Annuity Fund A
Annual Financial Information
Report of Independent Auditors
The Board of Managers and Contract Owners
IDS Life Variable Annuity Fund A:
We have audited the accompanying statement of assets, liabilities and contract
owners' equity of IDS Life Variable Annuity Fund A, including the schedule of
investments in securities, as of December 31, 1998, the related statement of
operations for the year then ended, the statements of changes in contract
owners' equity for each of the two years in the period then ended, and the
selected per unit data and ratios presented under "Financial highlights" for
each of the five years in the period then ended. These financial statements and
per unit data and ratios are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and per
unit data and ratios 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 and per unit data
and ratios are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments owned at
December 31, 1998, by correspondence with the custodian. 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 and selected per unit data and ratios
referred to above present fairly, in all material respects, the financial
position of IDS Life Variable Annuity Fund A at December 31, 1998, the results
of its operations for the year then ended, the changes in its contract owners'
equity for each of the two years in the period then ended, and the selected per
unit data and ratios for each of the five years in the period then ended in
conformity with generally accepted accounting principles.
Ernst & Young LLP
Minneapolis, Minnesota
February 5, 1999
<PAGE>
<TABLE>
<CAPTION>
IDS Life Variable Annuity Fund A
Statement of assets, liabilities and contract owners' equity Dec. 31, 1998
Assets
<S> <C>
Investments in securities, at value (Note 1)
(identified cost, $202,033,714) $406,961,879
Cash in bank on demand deposit 93,240
Dividends and interest receivable 161,098
Receivable from IDS Life Insurance Company for contract purchase payments 8,785,549
---------
Total assets $416,001,766
============
Liabilities
Payable for contract terminations $ 8,999,419
Payable to IDS Life Insurance Company for:
Mortality and expense assurance fee 4,661
Investment management fee 10,973
------
Total liabilities $ 9,015,053
============
Contract owners' equity
Contracts in accumulation period-- 16,299,010 units at $24.53 per unit (Note 5) $399,887,251
Contracts in payment period 7,099,462
---------
Total contract owners' equity 406,986,713
===========
Total liabilities and contract owners' equity $416,001,766
============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life Variable Annuity Fund A
Statement of operations Year ended Dec. 31, 1998
Investment income (loss) -- net
Income:
<S> <C>
Dividends $ 2,230,116
Interest 790,596
-------
Total income 3,020,712
---------
Expenses:
Mortality and expense assurance fee (Note 2) 3,919,255
Investment management fee (Note 3) 1,567,787
---------
Total expenses 5,487,042
---------
Investment income (loss) -- net (2,466,330)
==========
Realized and unrealized gain (loss) -- net
Net realized gain (loss) on investments 29,234,208
Net change in unrealized appreciation (depreciation) on investments 35,513,564
----------
Net gain (loss) on investments 64,747,772
----------
Net increase (decrease) in contract owners' equity from operations $62,281,442
===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
IDS Life Variable Annuity Fund A
Statements of changes in contract owners' equity
Year ended Dec. 31,
Operations 1998 1997
<S> <C> <C>
Investment income (loss)-- net $ (2,466,330) $ (2,268,845)
Net realized gain (loss) on investments 29,234,208 45,417,991
Net change in unrealized appreciation (depreciation) on investments 35,513,564 29,771,785
---------- ----------
Net increase (decrease) in contract owners' equity from operations 62,281,442 72,920,931
========== ==========
Contract transactions
Net contract purchase payments (Note 2) 1,715,061 1,936,783
Repayment of temporary withdrawals 25,885 15,682
Net transfers from (to) fixed annuities (3,139,872) (539,306)
Actuarial adjustment for mortality assurance on annuities
in payment period -- (60,462)
Contract termination payments and temporary withdrawals (32,599,118) (21,690,813)
Annuity payments (849,610) (808,071)
-------- --------
Net increase (decrease) from contract transactions (34,847,654) (21,146,187)
----------- -----------
Net increase (decrease) in contract owners' equity 27,433,788 51,774,744
---------- ----------
Contract owners' equity at beginning of year 379,552,925 327,778,181
=========== ===========
Contract owners' equity at end of year $406,986,713 $379,552,925
============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
IDS Life Variable Annuity Fund A
Notes to financial statements
1. Organization and summary of significant accounting policies IDS Life Variable
Annuity Fund A (the Fund) is organized as a segregated asset account of IDS Life
Insurance Company (IDS Life) under Minnesota law and is registered under the
Investment Company Act of 1940 as a diversified, open-end management investment
company. The Fund's assets are held for the exclusive benefit of its variable
annuity contract owners and are not chargeable with any liabilities arising from
the other business activities of IDS Life. The significant accounting policies
followed by the Fund are summarized as follows:
Use of estimates
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 increase and decrease in net assets from operations
during the period. Actual results could differ from those estimates.
Investments in securities
Securities traded on national securities exchanges are valued at the last quoted
sales price on the principal exchange on which traded. Securities traded in the
over-the-counter market are valued at the mean of the last quoted bid and asked
price. Short-term securities that mature in 60 days or less are valued at
amortized cost. Those maturing in 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 originally purchased with maturities of more than
60 days but which currently mature in 60 days or less are valued on an amortized
cost basis using the market value or approximate market value on the 61st day
before maturity. Bonds and other securities are valued at fair value as
determined by the Board of Managers when market quotations are not readily
available. Determination of fair value involves, among other things, references
to market indexes, matrices and data from independent brokers. Security
transactions are accounted for on the date the securities are purchased and
sold. Dividend income is recorded on the ex-dividend date.
Option contracts
In order to produce incremental earnings, protect gains and facilitate buying
and selling of securities for investment purposes, the Fund may buy and sell put
and call options and write covered call options on portfolio securities. The
risk in writing a call option is that the Fund gives up the opportunity of
profit if the market price of the security increases. The risk in writing a put
option is that the Fund may incur a loss if the market price of the security
decreases and the option is exercised. The risk in buying an option is that the
Fund pays a premium whether or not the option is exercised. The Fund also has
the additional risk of not being able to enter into a closing transaction if a
liquid secondary market does not exist.
Option contracts are valued daily at the closing prices on their primary
exchanges and unrealized appreciation or depreciation is recorded. The Fund will
realize a gain or loss upon expiration or closing of the option transaction.
When an option is exercised, the proceeds on sales for a written call option,
the purchase cost for a written put option or the cost of a security for a
purchased put or call option is adjusted by the amount of premium received or
paid.
During the year ended Dec. 31, 1998, the Fund did not buy or sell any put or
call options or write any covered call or put options. There were no option
contracts outstanding at Dec. 31, 1998.
Futures contracts
In order to gain exposure to or protect itself from changes in the market, the
Fund may buy and sell stock index futures contracts and related options. Risks
of entering into futures contracts and related options include the possibility
that there may be an illiquid market and that a change in the value of the
contract or option may not correlate with the changes in the value of the
underlying securities.
Upon entering into a futures contract, the Fund is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Fund each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the contract is closed
or expires.
During the year ended Dec. 31, 1998, the Fund did not buy or sell stock index
futures contracts and related options. There were no stock index futures
contracts outstanding at Dec. 31, 1998.
Foreign currency translations and foreign currency contracts
Securities and other assets and liabilities denominated in foreign currencies
are translated daily into U.S. dollars at the closing rate of exchange. Foreign
currency amounts related to the purchase or sale of securities and income and
expenses are translated at the rate of exchange on the transaction date. It is
not practicable to identify that portion of realized and unrealized gain or loss
arising from changes in the exchange rates from the portion arising from changes
in the market value of investments.
The Fund may also enter into forward foreign currency exchange contracts for
operational purposes and to protect against adverse exchange rate fluctuation.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using foreign currency exchange rates from an
independent pricing service. The Fund is subject to the credit risk that the
other party will not complete the obligations of the contract.
There were no forward foreign currency exchange contracts outstanding at Dec.
31, 1998.
Federal income taxes
IDS Life is taxed as a life insurance company. The Fund is treated as part of
IDS Life for federal income tax purposes. Under current federal income tax law,
no taxes are payable with respect to any income of the Fund.
2. Mortality and expense assurance fee and sales charges
IDS Life makes contractual assurances to the Fund that possible future adverse
changes in administrative expenses and mortality experience of the annuitants
and beneficiaries will not affect the Fund. The mortality and expense assurance
fee paid to IDS Life is computed daily and is equal on an annual basis to 1% of
the average daily net assets of the Fund.
Charges by IDS Life for its sales and administrative services applicable to the
variable annuity contracts amounted to $72,458 for the year ended Dec. 31, 1998,
and $80,608 for the year ended Dec. 31, 1997.
Such charges are not an expense of the Fund. They are deducted from contract
purchase payments and are not included in the net contract purchase payments to
the Fund.
3. Investment management agreement
The Fund has an Investment Management Agreement with IDS Life. For its services,
IDS Life is paid a fee based on the aggregate average daily net assets of the
Fund. The investment management fee paid to IDS Life is computed daily and is
equal on an annual basis to 0.4% of the average daily net assets of the Fund.
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.
<PAGE>
<TABLE>
<CAPTION>
4. Security transactions and basis for determining realized gain and loss
Cost of purchases and proceeds from sales of securities, (other than short-term
obligations) aggregated $70,966,280 and $100,927,732 for the year ended Dec. 31,
1998. Net realized gain on investments has been determined on the basis of
identified costs.
5. Accumulation units
The changes in number of outstanding units applicable to contracts in the
accumulation period were as follows:
Year ended Year ended
Dec. 31, 1998 Dec. 31, 1997
<S> <C> <C>
Units outstanding at beginning of year 17,871,071 18,939,349
Additions for contract purchase payments and repayments 78,469 97,242
Net transfers from (to) fixed annuities (145,269) (31,919)
Deductions for contract terminations and withdrawals (1,505,261) (1,133,601)
---------- ----------
Units outstanding at end of year 16,299,010 17,871,071
========== ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
6. Financial highlights
The table below shows certain important
financial information for evaluating the Fund's results. Fiscal year ended Dec. 31,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Accumulation unit value at beginning of year $20.91 $17.04 $13.93 $10.27 $10.70
Income from investment operations:
Net investment income (loss) (.14) (.12) (.07) (.02) .03
Net gains (losses)(both realized and unrealized) 3.76 3.99 3.18 3.68 (.46)
Total from investment operations 3.62 3.87 3.11 3.66 (.43)
Accumulation unit value at end of year $24.53 $20.91 $17.04 $13.93 $10.27
Total returna 17.31% 22.71% 22.33% 35.64% (4.01%)
Ratios/supplemental data
Total contract owner's equity at end of year
(000 omitted) $406,987 $379,553 $327,778 $284,407 $223,317
Ratio of operating expenses to average net assets 1.40% 1.40% 1.40% 1.40% 1.40%
Ratio of net investment income (loss) to average
net assets (.63%) (.62%) (.43%) (.19%) .27%
Portfolio turnover rate 19% 33% 13% 46% 63%
a Total return does not reflect payment of a sales charge.
The foregoing table pertains to accumulation units only. There are two kinds of
units. As long as contract holders are paying into the Fund they are called
"accumulation" units. When contract owners begin to receive the annuity, they
change to "annuity" units.
The value of an annuity unit (assuming a 3.5% investment rate) was $8.56 as of
Dec. 31, 1998, $7.55 as of Dec. 31, 1997, $6.37 as of Dec. 31, 1996, $5.39 as of
Dec. 31, 1995 and $4.11 as of Dec. 31, 1994. The value of an annuity unit
(assuming a 5% investment rate) was $5.49 as of Dec. 31, 1998, $4.92 as of Dec.
31, 1997, $4.21 as of Dec. 31, 1996, $3.61 as of Dec. 31, 1995 and $2.80 as of
Dec. 31, 1994.
</TABLE>
<PAGE>
Annual Report
IDSLife Variable Annuity Fund A
Notes to financial statements (continued)
7. Year 2000 (unaudited)
The Year 2000 issue is the result of computer programs having been written using
two digits rather than four to define a year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than 2000. This could result in the failure of major systems or miscalculations,
which could have a material impact on the operations of the Fund. The Fund has
no computer systems of its own but is dependent upon the systems of IDSLife
Insurance Company (IDSLife), American Express Financial Corporation (AEFC) and
certain other third parties.
Acomprehensive review of IDSLife's and AEFC's computer systems and business
processes has been conducted to identify the major systems that could be
affected by the Year 2000 issue. Steps are being taken to resolve any potential
problems including modification to existing software and the purchase of new
software. These measures are scheduled to be completed and tested on a timely
basis. IDSLife's and AEFC's target date for substantially completing corrective
measures on business critical systems was Dec. 31, 1998. Testing of these
systems is targeted for completion early in 1999. IDSLife and AEFC are currently
on track with this schedule and are also on track to finish the work on
non-critical systems by June 30, 1999. The Year 2000 readiness of other third
parties whose system failures could have an impact on the Fund's operations
continues to be evaluated. The potential materiality of any such impact is not
known at this time.
IDSLife's and AEFC's Year 2000 project includes establishing Year 2000
contingency plans for all key business units. These plans are being developed
and are expected to be substantially complete by the end of the first quarter of
1999. These plans will continue to be refined throughout 1999 as additional
information related to potential Year 2000 exposure is gathered.
<PAGE>
Annual Report
IDSLife Variable Annuity Fund A
Investments in securities, Dec. 31, 1998
(Percentages represent value of investments compared to net assets)
Common stocks (98.1%)
Issuer Shares Value(a)
Banks and savings & loans (3.9%)
BankBoston.................. 80,000 $3,115,000
Washington Mutual........... 330,000 12,601,875
Total 15,716,875
Beverages & tobacco (3.3%)
Coca-Cola................... 199,200 13,321,500
Chemicals (2.9%)
Waste Management............ 250,000 11,656,250
Communications equipment & services (8.5%)
Andrew Corp................. 263,300(b) 4,344,450
Ericsson (LM) ADR Cl B...... 300,000(c) 7,181,250
MasTec...................... 120,000(b) 2,520,000
Tellabs..................... 300,000(b) 20,568,750
Total 34,614,450
Computers & office equipment (24.2%)
Cisco Systems............... 270,000(b) 25,059,374
Compaq Computer............. 300,000 12,581,250
EMC......................... 150,000(b) 12,750,000
Hewlett-Packard............. 100,000 6,831,250
Intl Business Machines...... 100,000 18,475,000
Microsoft................... 140,000(b) 19,416,250
Solectron................... 40,000(b) 3,717,500
Total 98,830,624
Electronics (8.6%)
Applied Materials........... 195,600(b) 8,349,675
Intel....................... 120,000 14,227,500
Maxim Integrated Products... 140,000(b) 6,116,250
Texas Instruments........... 75,000 6,417,188
Total 35,110,613
Energy (2.3%)
Anadarko Petroleum.......... 300,000 9,262,500
Energy equipment & services (2.9%)
Halliburton................. 160,000 4,740,000
Schlumberger................ 150,000(c) 6,918,750
Total 11,658,750
Financial services (11.5%)
Associates First Capital Cl A 200,000 8,475,000
Citigroup................... 175,000 8,662,500
Franklin Resources.......... 200,000 6,400,000
Household Intl.............. 240,000 9,510,000
Merrill Lynch & Co.......... 120,000 8,010,000
Providian Financial......... 76,950 5,771,250
Total 46,828,750
Health care (11.4%)
Boston Scientific........... 100,000(b) 2,681,250
Guidant..................... 150,000 16,537,500
Johnson & Johnson........... 30,000 2,516,250
Medtronic................... 70,000 5,197,500
Pfizer...................... 120,000 15,052,500
Warner-Lambert.............. 60,000 4,511,250
Total 46,496,250
Health care services (3.1%)
HEALTHSOUTH Rehabilitation.. 489,200(b) 7,552,025
Service Corp Intl........... 130,000 4,948,125
Total 12,500,150
Issuer Shares Value(a)
Household products (1.8%)
ServiceMaster............... 340,050 $7,502,353
Industrial equipment & services (1.4%)
Deere & Co.................. 171,000 5,664,375
Insurance (1.7%)
American Intl Group......... 70,000 6,763,750
Leisure time & entertainment (0.6%)
Mattel...................... 106,300 2,424,969
Multi-industry conglomerates (3.3%)
Tyco Intl................... 180,000(c) 13,578,750
Utilities -- telephone (6.7%)
MCI WorldCom................ 300,000(b) 21,525,000
Sprint...................... 60,000 5,047,500
Sprint PCS.................. 30,000(b) 693,750
Total 27,266,250
Total common stocks
(Cost: $194,330,789) $399,197,159
Bond (0.1%)
Issuer Coupon Principal Value(a)
rate amount
U.S. government obligation
U.S. Treasury
05-15-16 7.25% $250,000 $302,940
Total bond
(Cost: $241,145) $302,940
Short-term securities (1.8%)
Issuer Annualized Amount Value(a)
yield on date payable at
of purchase maturity
U.S. government agencies (1.7%)
Federal Home Loan Bank Disc Nt
01-20-99 5.07% $500,000 $498,665
Federal Home Loan Mtge Corp Disc Nts
01-14-99 5.15 200,000 199,630
02-10-99 5.04 5,700,000 5,668,270
02-16-99 5.07 700,000 695,501
Total 7,062,066
Commercial paper (0.1%)
Intl Lease Finance
01-06-99 5.19 400,000 399,714
Total short-term securities
(Cost: $7,461,780) $7,461,780
Total investments in securities
(Cost: $202,033,714)(d) $406,961,879
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial
statements.
(b) Non-income producing.
(c) Foreign security values are stated in U.S. dollars. As of Dec. 31, 1998,
the value of foreign securities represented 6.80%of net assets.
(d) At Dec. 31, 1998, the cost of securities for federal income tax purposes
was $202,032,880 and the aggregate gross unrealized appreciation and
depreciation based on that cost was:
Unrealized appreciation.....................$217,620,019
Unrealized depreciation..................... (12,691,020)
Net unrealized appreciation.................$204,928,999
<PAGE>
Annual Report
IDSLife Variable Annuity Fund A
Managers and Officers
Board of Managers
Gumer C. Alvero
vice president, American Express Financial Corporation
Richard W. Kling
president, IDSLife Insurance Company
Edward Landes
retired, former development consultant
Carl N. Platou
president emeritus, Fairview Hospital
and Healthcare Services
Gordon H. Ritz
president, Con Rad Broadcasting Corp.
Principal Officers
Richard W. Kling
chairman of the board and president
Lorraine R. Hart
vice president, investments
Jeffrey S. Horton
vice president and treasurer
Timothy S. Meehan
secretary
William A. Stoltzmann
general counsel and assistant secretary
Philip C. Wentzel
controller
Additional Information
The investment objective of IDSLife Variable Annuity Fund A is to invest in
securities that offer opportunities for long-term capital appreciation
consistent with accumulating Fund value and providing annuity payments under
variable annuity contracts issued by IDSLife.
There is a sales and administrative charge to the contract owner included in the
purchase payment.
This report is for the information of contract owners of IDSLife Variable
Annuity Fund A, but it may be used as sales literature when preceded or
accompanied by the current prospectus. For details and other material
information, see the current prospectus.
Issuer and Investment Manager:
IDSLife Insurance Company,
Minneapolis, Minn.
Custodian:
American Express Trust Company
Minneapolis, Minn.
Sub-Custodian:
First Bank National Association
St. Paul, Minn.
<PAGE>
Annual Report
IDS Life
Variable
Annuity
Fund A
1998 annual report
S-6447 N (2/99)
Bulk Rate
U.S. POSTAGE
PAID
Permit No. 85
Spencer, IA
IDSLife Insurance Company
IDS Tower 10
Minneapolis, MN 55440-0010
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<NAME> VARIABLE ANNUITY FUND A
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