<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
STATEMENT OF CONDITION
-- December 31, 1999
<TABLE>
<CAPTION>
ASSETS:
<S> <C> <C> <C>
Investments in mutual funds: Shares Cost Value
--------- ------------ ------------
Massachusetts Investors Trust
(MIT)*............................... 1,697,160 $ 28,704,601 $ 35,556,867
Massachusetts Investors Growth Stock
Fund (MIG)*.......................... 949,976 13,684,303 19,315,840
MFS Total Return Fund (MTR)*.......... 1,749,395 26,445,364 24,279,987
MFS Growth Opportunities Fund
(MGO)*............................... 332,879 4,959,648 6,349,221
MFS Bond Fund (MFB)*.................. 124,537 1,642,269 1,516,924
MFS Global Governments Fund (MGG)*.... 78,265 843,786 736,693
MFS/Sun Life Series Trust:
Capital Appreciation Series (CAS)... 1,251,355 49,318,393 67,718,018
Government Securities Series
(GSS).............................. 656,963 8,345,165 8,196,928
High Yield Series (HYS)............. 489,217 4,478,219 4,410,862
Money Market Series (MMS)........... 5,374,271 5,374,271 5,374,271
------------ ------------
$143,796,019 $173,455,611
============
LIABILITY:
Payable to sponsor............................................... (7,594)
------------
Net Assets................................................. $173,448,017
============
</TABLE>
NET ASSETS:
<TABLE>
<CAPTION>
Applicable to Owners of
Deferred Variable Annuity Contracts Reserve for
------------------------------------- Variable
Units Unit Value Value Annuities Total
---------- ---------- ------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
MIT-Level 2................... 465,628 $57.7053 $ 26,391,503 $ 107,209 $ 26,498,712
MIT-Level 3................... 130,779 57.3100 7,385,119 -- 7,385,119
MIT-Level 4................... 39,282 42.5116 1,671,047 -- 1,671,047
MIG-Level 2................... 149,986 83.2189 12,481,832 -- 12,481,832
MIG-Level 3................... 52,563 92.2740 4,847,829 -- 4,847,829
MIG-Level 4................... 41,629 47.7261 1,986,179 -- 1,986,179
MTR-Level 2................... 520,185 37.1635 19,270,520 -- 19,270,520
MTR-Level 3................... 109,723 33.9969 3,715,582 -- 3,715,582
MTR-Level 4................... 49,629 26.0389 1,293,885 -- 1,293,885
MGO-Level 2................... 91,428 54.2319 4,990,759 -- 4,990,759
MGO-Level 3................... 21,491 58.4225 1,260,166 -- 1,260,166
MGO-Level 4................... 2,443 39.0855 98,296 -- 98,296
MFB-Level 2................... 51,937 21.1036 1,127,894 -- 1,127,894
MFB-Level 3................... 16,174 21.4275 361,582 -- 361,582
MFB-Level 4................... 803 17.7753 27,448 -- 27,448
MGG-Level 2................... 27,807 21.1751 588,578 -- 588,578
MGG-Level 3................... 4,822 18.8106 90,879 -- 90,879
MGG-Level 4................... 4,339 13.2346 57,236 -- 57,236
CAS-Level 2................... 582,574 72.1308 42,006,756 183,689 42,190,445
CAS-Level 3................... 102,101 76.9872 7,852,631 3,780 7,856,411
CAS-Level 4................... 234,710 75.3209 17,667,295 -- 17,667,295
GSS-Level 2................... 244,048 20.9090 5,100,752 2,867 5,103,619
GSS-Level 3................... 100,588 20.4157 2,055,873 1,522 2,057,395
GSS-Level 4................... 51,168 20.2049 1,034,035 -- 1,034,035
HYS-Level 2................... 125,543 25.8500 3,245,453 2,597 3,248,050
HYS-Level 3................... 29,465 24.1576 712,263 1,416 713,679
HYS-Level 4................... 18,908 23.7071 449,195 -- 449,195
MMS-Level 2................... 211,856 16.9810 3,590,866 2,500 3,593,366
MMS-Level 3................... 74,923 15.8614 1,186,553 -- 1,186,553
MMS-Level 4................... 38,024 15.6123 594,431 -- 594,431
------------ -------- ------------
Net Assets $173,142,437 $ 305,580 $173,448,017
============ ======== ============
</TABLE>
* Investments are made in Class A shares of the Fund
See notes to financial statements
1
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
STATEMENT OF OPERATIONS
-- Year Ended December 31, 1999
<TABLE>
<CAPTION>
MIT MIG MTR MGO MFB MGG
Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
INCOME AND EXPENSES:
Dividend income and capital gain
distributions received............... $ 1,226,792 $1,509,560 $ 2,586,765 $ 589,813 $ 148,468 $ 56,411
Mortality and expense risk charges.... (484,413) (216,603) (362,178) (65,839) (25,053) (14,987)
----------- ----------- ------------ ----------- ----------- -----------
Net investment income (loss)...... $ 742,379 $1,292,957 $ 2,224,587 $ 523,974 $ 123,415 $ 41,424
----------- ----------- ------------ ----------- ----------- -----------
REALIZED AND UNREALIZED GAINS (LOSSES):
Realized gains (losses) on investment
transactions:
Proceeds from sales................. $14,561,104 $8,520,345 $ 12,804,508 $1,426,391 $1,287,515 $ 1,092,443
Cost of investments sold............ (10,439,707) (5,721,364) (12,994,319) (1,196,553) (1,363,549) (1,179,952)
----------- ----------- ------------ ----------- ----------- -----------
Net realized gains (losses)....... $ 4,121,397 $2,798,981 $ (189,811) $ 229,838 $ (76,034) $ (87,509)
----------- ----------- ------------ ----------- ----------- -----------
Net unrealized appreciation
(depreciation) on investments:
End of year......................... $ 6,852,266 $5,631,537 $ (2,165,377) $1,389,573 $ (125,345) $ (107,093)
Beginning of year................... 9,682,996 3,947,317 (559,144) 606,768 (4,549) (82,136)
----------- ----------- ------------ ----------- ----------- -----------
Change in unrealized appreciation
(depreciation)................... $(2,830,730) $1,684,220 $ (1,606,233) $ 782,805 $ (120,796) $ (24,957)
----------- ----------- ------------ ----------- ----------- -----------
Realized and unrealized gains
(losses)........................... $ 1,290,667 $4,483,201 $ (1,796,044) $1,012,643 $ (196,830) $ (112,466)
----------- ----------- ------------ ----------- ----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS............................. $ 2,033,046 $5,776,158 $ 428,543 $1,536,617 $ (73,415) $ (71,042)
=========== =========== ============ =========== =========== ===========
<CAPTION>
CAS GSS HYS MMS
Sub-Account Sub-Account Sub-Account Sub-Account
----------- ----------- ------------ -----------
INCOME AND EXPENSES:
<S> <C> <C> <C> <C> <C> <C>
Dividend income and capital gain
distributions received............... $ 6,455,363 $ 473,835 $ 383,875 $ 273,757
Mortality and expense risk charges.... (658,857) (106,902) (55,610) (70,964)
----------- ----------- ------------ -----------
Net investment income (loss)...... $ 5,796,506 $ 366,933 $ 328,265 $ 202,793
----------- ----------- ------------ -----------
REALIZED AND UNREALIZED GAINS (LOSSES):
Realized gains (losses) on investment
transactions:
Proceeds from sales................. $11,456,990 $2,877,093 $ 1,368,628 $5,613,109
Cost of investments sold............ (8,838,975) (2,796,203) (1,323,619) (5,613,109)
----------- ----------- ------------ -----------
Net realized gains (losses)....... $ 2,618,015 $ 80,890 $ 45,009 $ --
----------- ----------- ------------ -----------
Net unrealized appreciation
(depreciation) on investments:
End of year......................... $18,399,625 $ (148,237) $ (67,357) $ --
Beginning of year................... 10,408,666 597,563 41,951 --
----------- ----------- ------------ -----------
Change in unrealized appreciation
(depreciation)................... $ 7,990,959 $ (745,800) $ (109,308) $ --
----------- ----------- ------------ -----------
Realized and unrealized gains
(losses)........................... $10,608,974 $ (664,910) $ (64,299) $ --
----------- ----------- ------------ -----------
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS............................. $16,405,480 $ (297,977) $ 263,966 $ 202,793
=========== =========== ============ ===========
</TABLE>
See notes to financial statements
2
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MIT MIG MTR
Sub-Account Sub-Account Sub-Account
-------------------------- -------------------------- --------------------------
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
-------------------------- -------------------------- --------------------------
1999 1998 1999 1998 1999 1998
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss).......... $ 742,379 $ 2,158,411 $ 1,292,957 $ 1,293,592 $ 2,224,587 $ 5,114,145
Net realized gains (losses)........... 4,121,397 5,509,297 2,798,981 1,702,339 (189,811) 2,000,585
Net unrealized gains (losses)......... (2,830,730) 702,599 1,684,220 2,483,740 (1,606,233) (3,555,136)
------------ ------------ ------------ ------------ ------------ ------------
Increase (Decrease) in net assets from
operations........................... $ 2,033,046 $ 8,370,307 $ 5,776,158 $ 5,479,671 $ 428,543 $ 3,559,594
------------ ------------ ------------ ------------ ------------ ------------
PARTICIPANT TRANSACTIONS:
Accumulation Activity:
Purchase payments received.......... $ 3,466,618 $ 4,615,049 $ 1,776,775 $ 1,648,663 $ 2,409,795 $ 3,371,244
Net transfers between Sub-Accounts
and Fixed Account.................. (850,973) (179,472) 1,475,098 583,305 (1,161,027) (1,254,402)
Withdrawals, surrenders,
annuitizations and contract
charges............................ (13,807,883) (13,124,763) (8,189,434) (4,889,909) (11,448,302) (9,074,024)
------------ ------------ ------------ ------------ ------------ ------------
Net accumulation activity......... $(11,192,238) $ (8,689,186) $ (4,937,561) $ (2,657,941) $(10,199,534) $ (6,957,182)
------------ ------------ ------------ ------------ ------------ ------------
Annuitization Activity:
Annuitizations...................... $ -- $ 117,436 $ -- $ -- $ -- $ --
Annity payments and contract
charges............................ (29,851) (6,831) -- -- -- --
Adjustments to annuity reserve...... (1,550) (439) -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------
Net annuitization activity........ $ (31,401) $ 110,166 $ -- $ -- $ -- $ --
------------ ------------ ------------ ------------ ------------ ------------
Increase (Decrease) in net assets from
participant transactions............. $(11,223,639) $ (8,579,020) $ (4,937,561) $ (2,657,941) $(10,199,534) $ (6,957,182)
------------ ------------ ------------ ------------ ------------ ------------
Increase (Decrease) in net assets... $ (9,190,593) $ (208,713) $ 838,597 $ 2,821,730 $ (9,770,991) $ (3,397,588)
NET ASSETS:
Beginning of year..................... 44,745,471 44,954,184 18,477,243 15,655,513 34,050,978 37,448,566
------------ ------------ ------------ ------------ ------------ ------------
End of year........................... $ 35,554,878 $ 44,745,471 $ 19,315,840 $ 18,477,243 $ 24,279,987 $ 34,050,978
============ ============ ============ ============ ============ ============
</TABLE>
See notes to financial statements
3
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
STATEMENTS OF CHANGES IN NET ASSETS
-- continued
<TABLE>
<CAPTION>
MGO MFB MGG
Sub-Account Sub-Account Sub-Account
------------------------ ----------------------- -------------------------
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
------------------------ ----------------------- -------------------------
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss).......... $ 523,974 $ 514,502 $ 123,415 $ 148,154 $ 41,424 $ 91,080
Net realized gains (losses)........... 229,838 246,705 (76,034) 48,083 (87,509) (38,711)
Net unrealized gains (losses)......... 782,805 391,771 (120,796) (116,828) (24,957) 5,053
---------- ---------- ----------- ---------- ------------ ----------
Increase (Decrease) in net assets
from operations.................. $1,536,617 $1,152,978 $ (73,415) $ 79,409 $ (71,042) $ 57,422
---------- ---------- ----------- ---------- ------------ ----------
PARTICIPANT TRANSACTIONS:
Accumulation Activity:
Purchase payments received.......... $ 663,514 $ 497,233 $ 245,793 $ 314,355 $ 122,908 $ 257,208
Net transfers between Sub-Accounts
and Fixed Account.................. 82,341 225,820 (220,519) (108,141) (85,033) (382,786)
Withdrawals, surrenders,
annuitizations and contract
charges............................ (1,264,444) (860,467) (1,023,830) (461,894) (986,749) (317,138)
---------- ---------- ----------- ---------- ------------ ----------
Net accumulation activity......... $ (518,589) $ (137,414) $ (998,556) $ (255,680) $ (948,874) $ (442,716)
---------- ---------- ----------- ---------- ------------ ----------
Increase (Decrease) in net assets
from participant transactions...... $ (518,589) $ (137,414) $ (998,556) $ (255,680) $ (948,874) $ (442,716)
---------- ---------- ----------- ---------- ------------ ----------
Increase (Decrease) in net assets... $1,018,028 $1,015,564 $(1,071,971) $ (176,271) $ (1,019,916) $ (385,294)
NET ASSETS:
Beginning of year..................... 5,331,193 4,315,629 2,588,895 2,765,166 1,756,609 2,141,903
---------- ---------- ----------- ---------- ------------ ----------
End of year........................... $6,349,221 $5,331,193 $ 1,516,924 $2,588,895 $ 736,693 $1,756,609
========== ========== =========== ========== ============ ==========
</TABLE>
See notes to financial statements
4
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
STATEMENTS OF CHANGES IN NET ASSETS
-- continued
<TABLE>
<CAPTION>
CAS GSS HYS MMS
Sub-Account Sub-Account Sub-Account Sub-Account
------------------------ ------------------------ ----------------------- ------------------------
Year Ended Year Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
------------------------ ------------------------ ----------------------- ------------------------
1999 1998 1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income
(loss)................. $ 5,796,506 $ 5,538,986 $ 366,933 $ 481,238 $ 328,265 $ 309,508 $ 202,793 $ 238,825
Net realized gains
(losses)............... 2,618,015 7,762,453 80,890 138,735 45,009 269,156 -- --
Net unrealized gains
(losses)............... 7,990,959 (725,520) (745,800) 165,097 (109,308) (593,830) -- --
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Increase (Decrease)
in net assets from
operations......... $16,405,480 $12,575,919 $ (297,977) $ 785,070 $ 263,966 $ (15,166) $ 202,793 $ 238,825
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
PARTICIPANT TRANSACTIONS:
Accumulation Activity:
Purchase payments
received............. $ 3,444,322 $ 4,587,562 $ 557,289 $ 924,333 $ 368,095 $ 507,550 $ 484,411 $ 802,246
Net transfers between
Sub-Accounts and
Fixed Account........ (539,704) (174,891) 42,123 (179,536) (147,327) (454,744) 1,766,578 1,431,968
Withdrawals,
surrenders,
annuitizations and
contract charges..... (9,183,402) (9,072,386) (2,407,705) (3,281,848) (970,623) (1,191,705) (3,577,347) (2,316,756)
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Net accumulation
activity........... $(6,278,784) $(4,659,715) $(1,808,293) $(2,537,051) $ (749,855) $(1,138,899) $(1,326,358) $ (82,542)
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Annuitization Activity:
Annuitizations........ $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
Annity payments and
contract charges..... (15,883) (13,867) (2,092) (2,138) (1,882) (1,925) (220) (221)
Adjustments to annuity
reserve.............. (2,645) (1,562) 67 (133) 28 7 (2) (7)
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Net annuitization
activity........... $ (18,528) $ (15,429) $ (2,025) $ (2,271) $ (1,854) $ (1,918) $ (222) $ (228)
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Increase (Decrease) in
net assets from
participant
transactions........... $(6,297,312) $(4,675,144) $(1,810,318) $(2,539,322) $ (751,709) $(1,140,817) $(1,326,580) $ (82,770)
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
Increase (Decrease) in
net assets........... $10,108,168 $ 7,900,775 $(2,108,295) $(1,754,252) $ (487,743) $(1,155,983) $(1,123,787) $ 156,055
NET ASSETS
Beginning of year....... 57,605,983 49,705,208 10,303,344 12,057,596 4,898,667 6,054,650 6,498,137 6,342,082
----------- ----------- ----------- ----------- ---------- ----------- ----------- ----------
End of year............. $67,714,151 $57,605,983 $ 8,195,049 $10,303,344 $4,410,924 $ 4,898,667 $ 5,374,350 $6,498,137
=========== =========== =========== =========== ========== =========== =========== ==========
</TABLE>
See notes to financial statements
5
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION
Sun Life of Canada (U.S.) Variable Account D (the "Variable Account"), a
separate account of Sun Life Assurance Company of Canada (U.S.) (the "Sponsor"),
was established on August 20, 1985 as a funding vehicle for the variable portion
of group combination fixed/variable annuities. The Variable Account is
registered with the Securities and Exchange Commission under the Investment
Company Act of 1940 as a unit investment trust.
The assets of the Variable Account are divided into Sub-Accounts. Each
Sub-Account is invested in shares of a specific mutual fund or series thereof
selected by contract owners from among available mutual funds (the "Funds")
advised by Massachusetts Financial Services Company ("MFS"), an affiliate of the
Sponsor.
(2) SIGNIFICANT ACCOUNTING POLICIES
GENERAL
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Sponsor's 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.
INVESTMENT VALUATIONS
Investments in the Funds are recorded at their net asset value. Realized gains
and losses on sales of shares of the Funds are determined on the identified cost
basis. Dividend income and capital gain distributions received by the
Sub-Accounts are reinvested in additional Fund shares and are recognized on the
ex-dividend date.
Exchanges between Sub-Accounts requested by contract owners are recorded in the
new Sub-Account upon receipt of the redemption proceeds.
FEDERAL INCOME TAX STATUS
The operations of the Variable Account are part of the operations of the Sponsor
and are not taxed separately. The Variable Account is not taxed as a regulated
investment company. The Sponsor qualifies for the federal income tax treatment
granted to life insurance companies under Subchapter L of the Internal Revenue
Code. Under existing federal income tax law, investment income and capital gains
earned by the Variable Account on contract owner reserves are not taxable and,
therefore, no provision has been made for federal income taxes.
6
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
NOTES TO FINANCIAL STATEMENTS -- continued
(3) CONTRACT CHARGES
A mortality and expense risk charge is deducted from the Variable Account at the
end of each valuation period for the mortality and expense risks assumed by the
Sponsor. These deductions are transferred periodically to the Sponsor. The rate
of this deduction varies, based on total purchase payments credited to all
participants' accounts under a contract as follows:
<TABLE>
<CAPTION>
Mortality
and Expense
Level Purchase Payments Risk Charge
- ----- ----------------- -----------
<S> <C> <C>
1 up to $250,000 1.30 %
2 $250,000 to $1,499,999 1.25 %
3 $1,500,000 to $4,999,999 1.10 %
4 $5,000,000 and over 0.95 %
</TABLE>
Since 1987, the Sponsor has reduced the Level 1 mortality and expense risk
charge to 1.25% and, therefore, has been accounting for all Level 1 units as
Level 2 units.
Each year on the account anniversary, an account administration fee is deducted
from the participant's account to cover administrative expenses relating to the
contract and the participant's account. The amount of the fee varies from $12 to
$25 and is based on total purchase payments credited to all participants'
accounts under a contract. After the annuity commencement date, the account fee
is deducted pro rata from each annuity payment made during the year.
The Sponsor does not deduct a sales charge from purchase payments. However, a
withdrawal charge (contingent deferred sales charge) may be deducted to cover
certain expenses relating to the sale of the contract. In no event shall the
aggregate withdrawal charges exceed 6% of the purchase payments made under the
contract.
A deduction, when applicable, is made for premium taxes or similar state or
local taxes. It is currently the policy of the Sponsor to deduct the taxes from
the amount applied to provide an annuity at the time annuity payments commence;
however, the Sponsor reserves the right to deduct such taxes when incurred.
(4) ANNUITY RESERVES
Annuity reserves are calculated using the 1983 Individual Annuitant Mortality
Table and an assumed interest rate of 4%. Required adjustments to the reserve
are accomplished by transfers to or from the Sponsor.
7
<PAGE>
SUN LIFE OF CANADA (U.S.) VARIABLE ACCOUNT D
NOTES TO FINANCIAL STATEMENTS -- continued
(5) UNIT ACTIVITY FROM PARTICIPANT TRANSACTIONS
<TABLE>
<CAPTION>
Units Transferred
Units Outstanding Between Sub-Accounts
Beginning of Year Units Purchased and Fixed Account
----------------- ---------------- --------------------
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
----------------- ---------------- --------------------
Sub-Accounts 1999 1998 1999 1998 1999 1998
- ------------ -------- -------- -------- ------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
MIT-Level 2 567,275 668,603 44,337 62,980 (12,590) (16,795)
MIT-Level 3 196,235 347,926 13,588 17,821 (6,224) (45,958)
MIT-Level 4 90,975 -- 13,148 18,926 (785) 77,367
MIG-Level 2 165,654 225,178 13,201 15,127 17,140 112
MIG-Level 3 89,584 118,801 8,105 9,647 2,290 (20,150)
MIG-Level 4 69,102 -- 10,657 11,428 2,394 60,010
MTR-Level 2 628,337 759,684 43,886 63,621 (18,021) (29,130)
MTR-Level 3 206,850 403,015 14,979 17,807 (12,441) (115,565)
MTR-Level 4 157,727 17 16,875 23,626 (8,784) 141,628
MGO-Level 2 95,086 100,623 8,656 9,995 1,152 1,211
MGO-Level 3 23,225 29,668 5,359 2,401 2,088 (2,227)
MGO-Level 4 11,370 -- 2,041 1,670 47 9,880
MFB-Level 2 76,030 86,309 6,257 8,189 (2,595) (4,987)
MFB-Level 3 23,254 41,360 3,408 3,535 (5,387) (14,129)
MFB-Level 4 19,478 -- 2,141 3,393 (2,840) 16,625
MGG-Level 2 35,699 50,083 2,182 4,145 (1,759) (9,529)
MGG-Level 3 16,947 55,415 782 2,132 (2,786) (34,966)
MGG-Level 4 45,525 -- 5,753 9,171 (740) 37,118
CAS-Level 2 628,268 680,351 34,983 52,252 (9,439) (7,521)
CAS-Level 3 111,749 431,268 4,961 13,268 1,153 (280,709)
CAS-Level 4 284,604 5,247 23,210 27,865 (4,525) 288,727
GSS-Level 2 317,889 377,706 19,457 27,776 (11,993) (8,985)
GSS-Level 3 107,677 225,343 5,826 13,066 15,145 (71,055)
GSS-Level 4 56,137 2,450 4,795 4,162 (4,404) 71,003
HYS-Level 2 147,334 161,891 10,902 14,548 (9,140) (13,379)
HYS-Level 3 32,554 89,331 2,861 3,878 423 (38,390)
HYS-Level 4 24,009 102 2,604 2,247 1,468 33,560
MMS-Level 2 254,576 246,919 19,791 32,188 67,567 55,799
MMS-Level 3 113,042 158,492 8,292 17,325 16,457 (8,342)
MMS-Level 4 39,132 6,803 2,910 1,532 23,818 44,744
<CAPTION>
Units Withdrawn,
Surrendered and Units Outstanding
Annuitized End of Year
----------------- -----------------
Year Ended Year Ended
December 31, December 31,
----------------- -----------------
Sub-Accounts 1999 1998 1999 1998
- ------------ -------- -------- -------- --------
<S> <C> <C> <C> <C>
MIT-Level 2 (133,394) (147,513) 465,628 567,275
MIT-Level 3 (72,820) (123,554) 130,779 196,235
MIT-Level 4 (64,056) (5,318) 39,282 90,975
MIG-Level 2 (46,009) (74,763) 149,986 165,654
MIG-Level 3 (47,416) (18,714) 52,563 89,584
MIG-Level 4 (40,524) (2,336) 41,629 69,102
MTR-Level 2 (134,017) (165,838) 520,185 628,337
MTR-Level 3 (99,665) (98,407) 109,723 206,850
MTR-Level 4 (116,189) (7,544) 49,629 157,727
MGO-Level 2 (13,466) (16,743) 91,428 95,086
MGO-Level 3 (9,181) (6,617) 21,491 23,225
MGO-Level 4 (11,015) (180) 2,443 11,370
MFB-Level 2 (27,755) (13,481) 51,937 76,030
MFB-Level 3 (5,101) (7,512) 16,174 23,254
MFB-Level 4 (17,976) (540) 803 19,478
MGG-Level 2 (8,315) (9,000) 27,807 35,699
MGG-Level 3 (10,121) (5,634) 4,822 16,947
MGG-Level 4 (46,199) (764) 4,339 45,525
CAS-Level 2 (71,238) (96,814) 582,574 628,268
CAS-Level 3 (15,762) (52,078) 102,101 111,749
CAS-Level 4 (68,579) (37,235) 234,710 284,604
GSS-Level 2 (81,305) (78,608) 244,048 317,889
GSS-Level 3 (28,060) (59,677) 100,588 107,677
GSS-Level 4 (5,360) (21,478) 51,168 56,137
HYS-Level 2 (23,553) (15,726) 125,543 147,334
HYS-Level 3 (6,373) (22,265) 29,465 32,554
HYS-Level 4 (9,173) (11,900) 18,908 24,009
MMS-Level 2 (130,078) (80,330) 211,856 254,576
MMS-Level 3 (62,868) (54,433) 74,923 113,042
MMS-Level 4 (27,836) (13,947) 38,024 39,132
</TABLE>
8
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Participants in Sun Life of Canada (U.S.) Variable Account D
and the Board of Directors of Sun Life Assurance Company of Canada (U.S.):
We have audited the accompanying statement of condition of Massachusetts
Investors Trust Sub-Account, Massachusetts Investors Growth Stock Sub-Account,
MFS Total Return Sub-Account, MFS Growth Opportunities Sub-Account, MFS Bond
Sub-Account, MFS Global Governments Sub-Account, MFS Capital Appreciation
Sub-Account, MFS Government Securities Sub-Account, MFS High Yield Sub-Account,
and MFS Money Market Sub-Account of Sun Life of Canada (U.S.) Variable Account D
(the "Sub-Accounts") as of December 31, 1999, the related statement of
operations for the year then ended and the statements of changes in net assets
for the years ended December 31, 1999 and 1998. These financial statements are
the responsibility of 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. Our procedures included
confirmation of securities held at December 31, 1999 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, such financial statements present fairly, in all material
respects, the financial position of the Sub-Accounts as of December 31, 1999,
the results of their operations and the changes in their net assets for the
respective stated periods in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
February 10, 2000
<PAGE>
COMPASS-G
DIRECTORS AND OFFICERS OF
SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)
DONALD A. STEWART, Chairman and Director
C. JAMES PRIEUR, President and Director
JAMES A. McNULTY, III, Senior Vice President,
General Manager and Director
S. CAESAR RABOY, Director
RICHARD B. BAILEY, Director
M. COLYER CRUM, Director
DAVID D. HORN, Director
ANGUS A. MacNAUGHTON, Director
GREGORY W. GEE, Director
PETER F. DEMUTH, Vice President, Chief
Counsel and Assistant Secretary
DAVEY S. SCOON, Vice President, Finance
and Treasurer
JAMES M. A. ANDERSON, Vice President, Investments
ROBERT P. VROLYK, Vice President and Actuary
ELLEN B. KING, Counsel and Secretary
SUN LIFE ASSURANCE COMPANY
OF CANADA (U.S.)
ANNUITY SERVICE MAILING ADDRESS:
Sun Life Retirement Products and Services
P.O. Box 1024, Boston, Massachusetts 02103-9986
GENERAL DISTRIBUTOR
Clarendon Insurance Agency, Inc.
One Sun Life Executive Park
Wellesley Hills, Massachusetts 02481
CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street, Boston, Massachusetts 02110-2875
AUDITORS
Deloitte & Touche LLP
200 Berkeley Street, Boston, Massachusetts 02116
ACCOUNT INFORMATION
For account information, call toll free: 1-800-752-7218 anytime from a
touch-tone telephone.
To speak with a customer service representative,
please call toll free 1-800-752-7215 from
8 a.m. to 6 p.m. Eastern time on any business day.
This report is prepared for the general information of
contract owners and participants. It is authorized for
distribution to prospective purchasers only if
preceded or accompanied by an effective prospectus.
COG2 2/00 23M
[LOGO]
PROFESSIONALLY MANAGED COMBINATION
FIXED/VARIABLE GROUP ANNUITY
FOR QUALIFIED AND NON-QUALIFIED
RETIREMENT PLANS
---------------------------------------------
ANNUAL REPORT, DECEMBER 31, 1999
[LOGO]
ISSUED BY
SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)
A WHOLLY OWNED SUBSIDIARY OF
SUN LIFE OF CANADA (U.S.) HOLDINGS, INC.
