Dear Shareholder,
The stock and bond market advance continued through the first half of 1998.
However, economic concerns increased throughout the period as the interest rate
decline that has been fueling the bond market advance appeared to bottom out in
mid-June, and the already selective stock market advance narrowed even further.
As a result, although most investors did quite well during the period, very few
investors fared as well as the broadly quoted indexes would indicate, and their
level of discomfort with the markets reached new highs right along with the
market indexes.
A plateauing bond market usually reflects "fears" of accelerating economic
growth. But, the stock market has been more focused on the Asian economic
problems and other possible dampening influences on our economy. As a result,
stock investment dollars have been directed primarily to the companies which
seem to be best able to contend with these challenges -- the largest, most
well-established technology and consumer products companies serving world-wide
markets. This has led to extreme performance and valuation imbalances between
the few very large, growth-oriented companies that have been leading the stock
market's advance and the vast "second tier" of the stock market. These very
sound and well-run companies' stocks have participated to a much lesser extent
in the market advance even though their earnings growth has held up as well as,
or even better than, that of the stock market leaders.
This extreme divergence of performance can be seen in the various stock market
indexes cited elsewhere in this report, but is also evident within the popular
Standard & Poor's 500 stock index. This index represents a cross section of the
nation's larger publicly held companies, and purports to portray the "average"
stock performance of all of these 500 stocks. But, each stock is weighted
according to the total market value of its outstanding shares. So, big companies
dominate the index (the largest, General Electric, is 478 times larger than the
smallest, Armco!). During the second quarter of 1998, the index was up 17.7 %,
but the average stock (equally weighting all 500 stocks) was up "only" 11.1%.
Does this stock performance difference between the largest companies and the
rest of the market represent differences in company earnings performance? Not
lately. Earnings gains have slowed throughout our economy since late-1997, and
most of the large companies propelling the S&P 500 index to new highs have done
no better than many others in maintaining their earnings growth. So, their
stocks' relative valuation levels have expanded. Four of the top five
contributors to the S&P 500's recent gains (Microsoft, Lucent Technologies,
Cisco Systems and Coca Cola) now sell at well over 50 times their currently
estimated 1998 earnings per share (the fifth, Wal-Mart, is at the index's median
multiple of 33 times earnings). And, these four "high priced" stocks, all by
themselves, accounted for over 50% of the index's second quarter gains.
In this environment of continued overall favorable economic performance and low,
stable interest rates, but with clouds on the horizon and a major component of
the stock market valued at significantly higher prices than the average stock,
we see both risk and opportunity. The chances of a stock market shock are
increased, and extreme volatility should be expected. But, much of the market
remains reasonably valued and should provide good long term returns for patient,
prudent investors.
The following pages present a more detailed look at each of the Ultra Series
Fund's performance, how it was achieved and how the portfolios are positioned
for the future. No one can ever know exactly what the future holds, but
understanding the investment approach we pursue on your behalf and developing
reasonable expectations for the various forms of investments is the cornerstone
of successful investing.
We at CIMCO and throughout the CUNA Mutual Group are honored to be your partners
in your pursuit of investment success and ultimate financial security.
Sincerely,
/s/Lawrence R. Halverson
Lawrence R. Halverson, CFA
Vice President
Ultra Series Fund
<PAGE>
CAPITAL APPRECIATION STOCK FUND OF ULTRA SERIES FUND
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
At this place, the shareholder report shows a graphic representation of how the
Capital Appreciation Stock Fund compared to several indexes. $10,000 invested on
the inception date of January 3, 1994 would have the following value as of June
30, 1998.
Capital Appreciation Stock Fund1 $25,030
S&P 500 Stock Index $26,882
Lipper Average2 $21,462
Consumer Price Index $11,146
The scale on this chart is different from the scale on the other charts in this
report because the fund's inception date is January 3, 1994.
- -------------------------------------------------------------------------
Average Annual Total Return
- -------------------------------------------------------------------------
- ---------------------------------- ---------- ---------- ----------------
Since Since Since Inception
12-31-97 12-31-92 of Fund
- ---------------------------------- ---------- ---------- ----------------
- ---------------------------------- ---------- ---------- ----------------
Capital Appreciation Stock Fund3 13.75% N/A 22.64%
S&P 500 Stock Index 17.70% N/A 24.58%
Lipper Average2 15.63% N/A 14.90%
Consumer Price Index 0.68% N/A 2.44%
- ---------------------------------- ---------- ---------- ----------------
TEN LARGEST HOLDINGS (% of Portfolio)
MediaOne Group Inc............ 4.3% Dayton Hudson Corporation...... 2.7%
EMC Corp...................... 3.9% Safeway, Inc................... 2.4%
Owens Illinois, Inc........... 3.7% Interim Services, Inc.......... 2.6%
Airtouch Communications, Inc.. 3.6% Mutual Risk Management Ltd..... 2.5%
Travelers Group, Inc.......... 3.0% Wang Laboratories, Inc......... 2.4%
At this place, the shareholder report contains a pie chart showing a portfolio
mix of 3.9% in foreign stocks, 3.0% in short-term investments and 93.1% in
common stock.
1 Capital Appreciation Stock Fund returns on the graph are from inception,
January 3, 1994.
2 Lipper Performance Summary Average for Capital Appreciation Stock Funds
represents the average annual total return of all the underlying Capital
Appreciation Stock Funds in Lipper Analytical Services Variable Insurance
Products Performance Analysis Service.
3 Fund returns are calculated after mutual fund level expenses have been
subtracted, as described in the prospectus. Market indexes are not actual
investment alternatives; the returns shown reflect just the income from and
changes in value of the securities in the index and do not reflect any
deduction for the transaction costs, bid/asked spreads, management fees or
operating expenses that would be incurred in an actual indexed or managed
fund.
Figures for more than one year reflect a steady compounded rate. Actual returns
fluctuated year by year. Because principal value and investment return
fluctuate, there may be a gain or loss on withdrawal. Past performance is not
predictive of future results. This material must be preceded or accompanied by a
current prospectus. Current prospectuses are mailed to existing policyholders.
<PAGE>
Management's Discussion of First Half 1998 Performance
Capital Appreciation Stock Fund
Investment Objective: Seeks a high level of long-term growth of capital by
investing in common stocks, including those of smaller companies and companies
undergoing significant change.
Management's Discussion: Returns in the U.S. stock market varied widely as the
S&P 500 index was driven by the strong performance of a small number of
mega-capitalization "growth" stocks. Small- and mid-capitalization stock indexes
continued to lag large-capitalization indexes, but still provided attractive
returns. The Capital Appreciation Stock Fund's investment approach of staying
invested in reasonably valued companies across all capitalization segments of
the equity market caused the Fund's return to lag the more widely cited "big
cap" market indexes, but matched or exceeded the mid- and small-cap indexes. The
Fund also modestly lagged the Lipper average of similar variable insurance
products funds due largely to its more conservative, value-oriented management
style in the face of the growth-oriented bias of the market during this six
month period.
USF Capital Appreciation Stock Fund 13.8%
Russell 2000 Index (Small capitalization stocks) 4.9%
Standard & Poor's Mid Cap 400 Index (Middle capitalization stocks) 8.6%
Russell 1000 Index (Large capitalization stocks) 16.2%
Standard & Poor's 500 Index (Large capitalization stocks) 17.7%
Lipper Average of Capital Appreciation Funds 15.6%
First half Fund results benefited from strong performance in the consumer
staples sector, one of the Fund's most heavily weighted areas. Consumer staples
holdings were approximately twice the sector weight of the S&P Mid-Cap Index and
one-and-a-quarter times that of the S&P 500. The Fund's consumer staples
holdings appreciated by approximately 19.6% during the first half of the year,
led by the strong performance of cable industry holdings MediaOne Group and Cox
Communications, as well as supermarket operator Safeway Inc. Drug retailer Rite
Aid also outperformed significantly. We are maintaining our overweighted
position in this sector, though we have been shifting assets toward stocks such
as Tyson Foods and Nabisco Holdings which have been laggards in the sector and
appear to offer better value at this time.
The Fund also benefited from strong stock performance in the consumer cyclical,
technology and communication services sectors. Negative impacts on fund
performance came from the capital goods sector, due to poor performance from
Raychem, a maker of copper and fiber accessory products, and from the
transportation sector.
The Fund enters the third quarter with overweighted positions relative to the
S&P Mid Cap 400 Index in the consumer staples, health care and communication
services sectors, and underweighted positions in the utilities and consumer
cyclical sectors. Sector weights are a function of our "bottom-up" analysis and
reflect the relative attractiveness of individual stocks, not macro-economic
assessments of the broad sectors.
Given current market valuation levels, a period of increased market volatility
or a short term pull-back is quite possible. Occasional corrections, though
unnerving at times, are a normal phase of bull markets and have a relatively
small impact on long term investment results. We continue to believe that
investors should maintain their long-term investment accumulation programs and
not try to time the market.
CIMCO Inc. Common Stock Portfolio Management Team
<PAGE>
GROWTH AND INCOME STOCK FUND OF ULTRA SERIES FUND
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
At this place, the shreholder report shows a graphic representation of how the
Growth and Income Stock Fund compared to several indexes. A $10,000 investment
on the inception date of January 3, 1985, would have the following value as of
June 30, 1998.
Growth and Income Stock Fund $52,621
S&P 500 Stock Index $61,732
Lipper Average1 $49,550
Consumer Price Index $14,084
- -----------------------------------------------------------------------
Average Annual Total Return
- -----------------------------------------------------------------------
- -------------------------------- ------------ ------------ ------------
Since Since Since
12-31-97 12-31-92 12-31-87
- -------------------------------- ------------ ------------ ------------
- -------------------------------- ------------ ------------ ------------
Growth and Income Stock Fund2 12.23% 20.08% 17.13%
S&P 500 Stock Index 17.70% 21.81% 18.93%
Lipper Average1 12.22% 18.10% 16.46%
Consumer Price Index 0.68% 2.49% 3.32%
- -------------------------------- ------------ ------------ ------------
TEN LARGEST HOLDINGS (% of Portfolio)
MediaOne Group Inc. ............ 3.2% Bank One Corporation ............ 2.4%
American Home Products Corp... . 2.9% Int'l Business Machines Corp..... 2.4%
Wal-Mart Stores, Inc............ 2.9% Crown Cork & Seal CO., Inc...... 2.3%
EMC Corp. ...................... 2.8% Travelers Group, Inc. ........... 2.3%
Bristol-Myers Squibb Co. ....... 2.6% Allstate Corporation............. 2.3%
At this place, the shareholder report contains a pie chart showing a portfolio
mix of 2.9% in foreign stocks, 3.4% in short-term investments and 93.7% in
common stock.
1 The Lipper Performance Summary Average for Growth and Income Stock Funds
represents the average annual total return of all the underlying Growth and
Income Stock Funds in Lipper Analytical Services Variable Insurance
Products Performance Analysis Service.
2 Fund returns are calculated after mutual fund level expenses have been
subtracted, as described in the prospectus. Market indexes are not actual
investment alternatives; the returns shown reflect just the income from and
changes in value of the securities in the index and do not reflect any
deduction for the transaction costs, bid/asked spreads, management fees or
operating expenses that would be incurred in an actual indexed or managed
fund.
Figures for more than one year reflect a steady compounded rate. Actual returns
fluctuated year by year. Because principal value and investment return
fluctuate, there may be a gain or loss on withdrawal. Past performance is not
predictive of future results. This material must be preceded or accompanied by a
current prospectus. Current prospectuses are mailed to existing policyholders.
<PAGE>
Management's Discussion of First Half 1998 Performance
Growth and Income Stock Fund
Investment Objective: Seeks long-term growth of capital, with income as a
secondary consideration, by investing primarily in common stocks of companies
with financial and market strengths and long-term records of performance.
Management's Discussion: The bull market marched on through the first six months
of 1998, pushing stock indexes to record levels. However, the gains are becoming
concentrated in fewer and fewer stocks. For instance, the 14 largest performance
contributors among the 500 stocks in the Standard & Poor's 500 index accounted
for 100% of the index's 17.7% gain; the other 486 stocks merely "broke even" on
average for the period! Smaller company stock indexes provided much more modest
returns, but were at least in line with U. S. common stocks' historical
averages. The Growth and Income Fund returned 12.2% during this six month
period, exceeding all but the large company stock indexes and right in line with
the Lipper average of similar variable insurance products underlying mutual
funds.
USF Growth and Income Stock Fund 12.2%
Russell 2000 Index (Small capitalization stocks) 4.9%
Standard & Poor's 400 Index (Middle capitalization stocks) 8.6%
Russell 1000 Index (Large capitalization stocks) 16.2%
Standard & Poor's 500 Index (Large capitalization stocks) 17.7%
Lipper Average of Growth and Income Funds 12.2%
Market performance during the period was driven by outperformance in the
consumer cyclical, healthcare and technology sectors. In the Growth & Income
portfolio, the healthcare and technology sectors did well relative to the
overall index, however they trailed their respective industry groups in the
index. The basic materials and consumer staples sectors had a negative impact on
fund performance. Noteworthy contributors to our good returns during the period
included Echlin, Wal-Mart, Sears, MediaOne Group, Morgan Stanley-Dean Witter,
EMC, American Home Products, and Airtouch Communications.
The Fund enters the third quarter with modestly overweighted positions in the
technology, healthcare, and consumer cyclicals sectors, and underweighted
positions in the capital goods and finance sectors. Sector weights are a
function of our "bottom-up" analysis and reflect the relative attractiveness of
individual stocks, not macro-economic assessments of the broad sectors.
The strength of the bull market in the face of the Asian fallout has surprised
most investors. While there are solid fundamentals that are favorable for the
long-term investor, it is important to recognize what is driving these returns.
As stated above, the returns have been concentrated in a small number of
industry-leading stocks that carry high P/E ratios (high prices of the stocks
relative to their earnings per share). This increasing "narrowness" of the
market returns is further widening the valuation gap between the large company
stocks and the rest of the market.
With the market at these high valuation levels, the likelihood of increased
market volatility or a short term correction is also high. However, the solid
foundation of strong economic fundamentals remains intact, and should continue
to offer support to long term investors who maintain their investment
accumulation discipline and do not try to time the market. It is important to
remember that occasional corrections are a normal phase of bull markets, and
while unnerving in the short term, have a relatively small impact on long term
investment results.
CIMCO Inc. Common Stock Portfolio Management Team
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
At this place, the shareholder report shows a graphic representation of how the
Balanced Fund compared to several indexes. A $10,000 investment on the inception
date of January 3, 1985 would have the following value as of June 30, 1998.
Balanced Fund $32,206
Synthetic Index1 $35,121
Lipper Average2 $34,357
Consumer Price Index $14,084
- ------------------------------------------------------------------------
Average Annual Total Return
- ------------------------------------------------------------------------
- ------------------------------- ------------ ------------- -------------
Since Since Since
12-31-97 12-31-92 12-31-87
- ------------------------------- ------------ ------------- -------------
- ------------------------------- ------------ ------------- -------------
Balanced Fund3 7.59% 12.09% 11.78%
Synthetic Index 9.62% 13.14% 12.71%
Lipper Average2 9.61% 13.26% 12.47%
Consumer Price Index 0.68% 2.49% 3.32%
- ------------------------------- ------------ ------------- -------------
At this place, the shareholder report contains a pie chart showing a portfolio
mix of 5.6% in short-term investments, 11.7% in government & agency bonds, 30.7%
in corporate bonds, 49.5% in common stocks, 1.7% in foreign bonds, and 0.8% in
foreign common stocks.
1 The Synthetic Index represents the average annual total returns of a
portfolio which was annually readjusted to 45% Standard and Poor's 500, 40%
Lehman Intermediate Government/Corporate Index, and 15% 90-Day Treasury
Bills.
2 The Lipper Performance Summary Average for Balanced Funds represents the
average annual total return of all the underlying Balanced Funds in Lipper
Analytical Services Variable Insurance Products Performance Analysis
Service.
3 Fund returns are calculated after mutual fund level expenses have been
subtracted, as described in the prospectus. Market indexes are not actual
investment alternatives; the returns shown reflect just the income from and
changes in value of the securities in the index and do not reflect any
deduction for the transaction costs, bid/asked spreads, management fees or
operating expenses that would be incurred in an actual indexed or managed
fund.
Figures for more than one year reflect a steady compounded rate. Actual returns
fluctuated year by year. Because principal value and investment return
fluctuate, there may be a gain or loss on withdrawal. Past performance is not
predictive of future results. This material must be preceded or accompanied by a
current prospectus. Current prospectuses are mailed to existing policyholders.
<PAGE>
Management's Discussion of First Half 1998 Performance
Balanced Fund
Investment Objective: Seeks a high total return through the combination of
income and capital growth by investing in common stocks of the type owned in the
Growth and Income and Capital Appreciation Stock Funds, bonds of the type owned
in the Bond Fund and money market instruments of the type owned in the Money
Market Fund.
Management's Discussion: With most U. S. stock indexes providing returns ranging
from the low to the high teens, and bond returns generally ranging from 3% to
6%, the first half of 1998 provided a very favorable environment for investors
in diversified portfolios like the Ultra Series Balanced Fund. The Fund's
generally conservative composition dampened returns somewhat relative to common
market indexes and the Lipper average of similar funds, but still provided above
average returns for this six month period relative to the long term historical
investment market averages:
USF Balanced Fund 7.6%
Synthetic Index* 9.6%
Lipper Average of Balanced Funds 9.6%
* 45% Standard & Poor's 500, 40% Lehman Intermediate Government/Corporate
Index and 15% 90-day U. S. Treasury bills.
The key operating factors causing a difference between the Balanced Fund's
return and that of the synthetic index were Fund expenses, which averaged
approximately .34% of Fund assets in this six month period, and transaction
costs. Market indexes are not actual investment funds and do not bear either
expenses or transaction costs.
In addition, although the markets represented in the synthetic index (described
in the footnote above) better represent the types of securities owned in the
Balanced Fund than any other single stock and bond indexes, the Balanced Fund
generally invests in some stocks of smaller capitalization companies than those
represented in the Standard & Poor's 500, and it invests a smaller proportion of
its assets in U. S. Treasury bonds than represented in the Lehman Intermediate
Government/Corporate Index. These differences typically provide higher returns
to the Fund, but that has not been the case in the last several months' "large
cap" stock market and "flight to quality" bond market environment.
Management's discussions of the Bond, Growth and Income Stock and Capital
Appreciation Stock Funds elsewhere in this report provide descriptions of the
various portfolio management activities which were employed for these funds as
well as in the Balanced Fund, explaining the major sources of positive and
negative variances in Fund performance relative to the indexes.
The difference between the performance of the Balanced Fund in the first half of
1998 and that of the average balanced fund in the Lipper universe was primarily
attributable to the long-standing difference in the mix of stocks, bonds and
money market investments. The average balanced fund has a greater proportion of
its assets invested in stocks and less in bonds and money markets than does the
Ultra Series Balanced Fund. This reflects the more aggressive management style
of the average fund relative to the more conservative structure of the Ultra
Series Balanced Fund. This difference has resulted in somewhat lower total
returns in recent periods for the Balanced Fund, but it has also very favorably
impacted the Balanced Fund's stability of returns, a common measure of
investment risk.
Diversified investing always makes good sense, and it makes especially good
sense in periods of heightened risk due to higher market valuation levels or
increased economic uncertainty. Today's economic outlook is about as favorable
as it can be, but this is reflected in today's valuation levels. So, investors'
risks are high, at least in the near-term. We continue to be strong believers in
the long-term attractiveness of the U. S. securities markets, and believe that
the diversified approach pursued by the Ultra Series Balanced Fund will continue
to serve investors very well.
CIMCO Inc. Balanced Portfolio Management Team
<PAGE>
BOND FUND OF ULTRA SERIES FUND
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
At this place, the shareholder report shows a graphic representation of how the
Bond Fund compared to several indexes. A $10,000 investment on the inception
date of January 3, 1985 would have the following value as of June 30, 1998.
Bond Fund $22,219
Lehman Brothers Intermediate Government/Corporate Bond Index $23,046
Lipper Average1 $19,849
Consumer Price Index $14,084
- --------------------------------------------------------------------------
Average Annual Total Return
- --------------------------------------------------------------------------
- -------------------------------- ------------- ------------- -------------
Since Since Since
12-31-97 12-31-92 12-31-87
- -------------------------------- ------------- ------------- -------------
- -------------------------------- ------------- ------------- -------------
Bond Fund2 3.36% 6.35% 7.90%
Lehman Brothers Intermediate
Govt./Corporate Bond Index 3.46% 6.70% 8.28%
Lipper Average1 3.79% 5.49% 6.75%
Consumer Price Index 0.68% 2.49% 3.32%
- -------------------------------- ------------- ------------- -------------
At this place, the shareholder report contains a pie chart showing a portfolio
mix of 1.5% in short-term investments, 14.2% in government & agency bonds, 3.0%
in non-corporate bonds, 4.2% in foreign bonds, and 77.1% in corporate bonds.
1 The Lipper Performance Summary average for Short/Intermediate Investment
Grade Funds represents the average annual total return of all the
underlying Short/Intermediate Investment Grade Funds in Lipper Analytical
Services Variable Insurance Products Performance Analysis Service.
2 Fund returns are calculated after mutual fund level expenses have been
subtracted, as described in the prospectus. Market indexes are not actual
investment alternatives; the returns shown reflect just the income from and
changes in value of the securities in the index and do not reflect any
deduction for the transaction costs, bid/asked spreads, management fees or
operating expenses that would be incurred in an actual indexed or managed
fund.
Figures for more than one year reflect a steady compounded rate. Actual returns
fluctuated year by year. Because principal value and investment return
fluctuate, there may be a gain or loss on withdrawal. Past performance is not
predictive of future results. This material must be preceded or accompanied by a
current prospectus. Current prospectuses are mailed to existing policyholders.
<PAGE>
Management's Discussion of First Half 1998 Performance
Bond Fund
Investment Objective: Seeks a high level of current income, consistent with the
prudent limitation of investment risk, through investment in a diversified
portfolio of fixed income securities with maturities of up to 30 years. The Fund
emphasizes intermediate-term maturities.
Management's Discussion: The bond market has traded in a relatively narrow range
since the beginning of the year. It rallied modestly early in the year only to
give back most of the gains by the end of April, rallied again to mid-June, then
trended a little lower to the end of the month. Intermediate-term Treasury bond
yields ranged between 5.3% and 5.7%, ending the period at about 5.4%, down from
5.6% where they began the year. As a result, bond investors "earned the coupon"
plus a small price gain for the period. The yield curve, which relates yields on
bonds with their years to maturity, remained quite flat -- the yield difference
between two-year and ten-year bonds was only 0.1%.
The Bond Fund provided a return in line with the historical norms for investment
grade, intermediate term bonds during this six month period. This compared well
with the representative Lehman Brothers bond indexes, and was comparable to the
return reported by Lipper Analytical Services for its index of similar variable
insurance products underlying mutual funds.
USF Bond Fund 3.6%
Lehman Brothers Intermediate Government/Corporate Index 3.5%
Lehman Brothers Aggregate Index 3.9%
Lehman Brothers Government/Corporate Index 4.2%
Lipper Average of Intermediate Investment Grade Bond Funds 3.8%
The Bond Fund's return was in line with the intermediate term index even after
fund expenses of about .3% due to the favorable impact of the Fund's
greater-than-index exposure to corporate bonds versus government bonds.
Corporates generally outperformed governments through to first half of the year
as interest rate spreads tightened in response to the continued favorable
economic environment. The slight difference between the Fund's return and that
of the Lipper average of similar funds was due to the average fund's somewhat
longer maturity and lower quality than our fund. The Bond Fund's more
conservative approach adds stability and safety, but can limit returns in
favorable interest rate environments.
The Fund's holdings are well diversified across sectors. Corporate issues,
comprising over 75% of net assets in total, are about 30% industrials, 30%
financials and 15% utilities. The foreign category -- a small amount of
corporates and a few government securities, totaling about 7% of net assets --
provides diversification and higher potential returns than domestic securities
of comparable credit quality. Mortgage-related securities are currently 6% of
the Fund's net assets. Very safe and highly liquid U. S. government securities
and deposits constitute the remainder of net assets. The portfolio of bonds
currently has a 7.5 year average maturity, an effective duration of 4.2 and
provides a 6.4% yield to maturity before expenses.
The Ultra Series Bond Fund's investments will remain focused in issues having
intermediate-term maturities, usually resulting in a portfolio duration of from
three to five years. We have been reducing by consolidation the number of issues
in the portfolio, aiming for about 50 primary holdings to provide the benefits
of diversification yet not dilute either the fund's performance or the
management team's effectiveness in monitoring and managing the portfolio. The
team employs a disciplined, contrarian-oriented investment selection process
designed to identify attractive pricing in the bond markets. Securities
selection is the core of our management efforts; neither large market timing
moves based on interest rate predictions nor heavy reliance on high yielding but
volatile "junk" bonds are employed. We believe the Bond Fund's conservative
investment approach will make it an important source of predictable income and
price stability for many shareholders' diversified investment portfolios.
CIMCO Inc. Bond Portfolio Management Team
<PAGE>
TREASURY 2000 FUND OF ULTRA SERIES FUND
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
At this place, the shareholder report shows a graphic representation of how the
Treasury 2000 Fund compared to several indexes. A $10,000 investment on the
inception date of July 28, 1988 would have the following value as of June 30,
1998.
Treasury 2000 Fund1 $26,330
Lipper Average2 $27,458
Lehman Brothers Intermediate Treasury Bond Index $22,513
Consumer Price Index $14,084
- --------------------------------------------------------------------------
Average Annual Total Return
- --------------------------------------------------------------------------
- ---------------------------------- ---------- ----------- ----------------
Since Since Since
12-31-97 12-31-92 Inception of
Fund
- ---------------------------------- ---------- ----------- ----------------
- ---------------------------------- ---------- ----------- ----------------
Treasury 2000 Fund3 3.20% 7.13% 10.17%
Lehman Brothers Intermediate
Treasury Bond Index 3.47% 6.41% 8.04%
Lipper Average2 4.08% 8.61% 10.10%
Consumer Price Index 0.68% 2.49% 3.32%
- ---------------------------------- ---------- ----------- ----------------
1 Treasury 2000 Fund returns on the graph are from inception, July 28, 1988.
2 The Lipper Performance Summary Average for Target Maturity Funds represents
the average annual total return of all the underlying Target Maturity Funds
in Lipper Analytical Services Variable Insurance Products Performance
Analysis Service. The Lipper Performance Summary Average for Target
Maturity Funds covers the period from January 1, 1988 to December 31, 1997.
This is not exactly the same time frame as the Treasury 2000 Fund which
began on July 29, 1988.
3 Fund returns are calculated after mutual fund level expenses have been
subtracted, as described in the prospectus. Market indexes are not actual
investment alternatives; the returns shown reflect just the income from and
changes in value of the securities in the index and do not reflect any
deduction for the transaction costs, bid/asked spreads, management fees or
operating expenses that would be incurred in an actual indexed or managed
fund.
Figures for more than one year reflect a steady compounded rate. Actual returns
fluctuated year by year. Because principal value and investment return
fluctuate, there may be a gain or loss on withdrawal. Past performance is not
predictive of future results. This material must be preceded or accompanied by a
current prospectus. Current prospectuses are mailed to existing policyholders.
<PAGE>
Management's Discussion of First Half 1998 Performance
Treasury 2000 Fund
Investment Objective: Seeks safety of capital and a relatively predictable
payout upon Portfolio Maturity, primarily by investing in Stripped Treasury
Securities.
Management's Discussion: The first half of 1998 saw interest rates fluctuating
in a relatively narrow range, declining slightly overall. The Treasury 2000
Fund's investment approach of staying invested exclusively in U. S. Treasury
Strips or similar zero coupon securities with a maturity date of November 15,
2000, allowed the Fund to advance along with the bond market and similar funds
as interest rates eased.
USF Treasury 2000 Fund 3.2%
Lehman Intermediate Treasury Bond Index 3.5%
Lipper Average of Target Maturity Funds 4.1%
The key operating factors causing a difference between the Fund's return and
that of the index were Fund expenses, which amounted to .23% of Fund assets in
this period, and transaction costs. Market indexes are not actual investment
funds and do not bear either expenses or transaction costs.
The performance of the Treasury 2000 Fund in the first half of 1998, relative to
the index, was negatively impacted by the Fund's somewhat shorter duration (2.8
versus 3.3 for the index) during a time of modestly declining interest rates.
Similarly, the average target maturity fund in the Lipper universe has a longer
duration than the Fund, producing the slightly higher return for this "peer
group average" in this period.
Between now and the November 15, 2000, maturity and distribution date, the
Fund's returns will reflect changes in market interest rate levels, but will be
primarily impacted by the appreciation of the Fund's investment securities to
their face value at maturity. A Fund share purchased on June 30, 1998, and held
to the November 15, 2000, maturity date would provide a yield to maturity of
5.7%.
As is always the case with target maturity funds like Treasury 2000, the
risk/return nature of the fund changes quite dramatically as the maturity date
of the fund approaches. It will perform more and more like a short term bond
fund or money market fund. Its month-to-month variability of returns will
decrease, as will its overall level of returns (barring an extreme change in
interest rate levels). Investors who selected this fund for its high returns
relative to the certainty of its value at maturity may be better served over the
next couple of years by either the Money Market Fund (for investors seeking high
stability of "principal" and "savings-type" returns, or the Bond Fund (for
investors willing to accept moderate variability in principal values in the
pursuit of higher yields). We encourage you to discuss these alternatives with
your representative or call the CUNA Mutual Life Insurance Company offices at
1-800-798-5500.
CIMCO Inc. Bond Management Team
<PAGE>
<TABLE>
<CAPTION>
ULTRA SERIES FUND
Statement of Assets and Liabilities
June 30, 1998
(Unaudited)
Capital Growth and Money Treasury
Appreciation Income Stock Balanced Bond Market 2000
Assets: Stock Fund Fund Fund Fund Fund Fund
---------- ---- ---- ---- ---- ----
Investments in securities, at value,
(note 2) - see accompanying schedule
<S> <C> <C> <C> <C> <C> <C>
(cost $446,012,486) $562,946,734 $ -- $ -- $ -- $ -- $ --
(cost $550,515,939) -- 742,220,248 -- -- -- --
(cost $324,472,824) -- -- 385,633,295 -- -- --
(cost $200,215,863) -- -- -- 201,810,654 -- --
(cost $42,715,028) -- -- -- -- 42,715,028 --
(cost $1,558,973) -- -- -- -- -- 1,759,666
Receivable for securities sold 708,343 706,681 206,228 1,382 -- --
Accrued interest receivable -- -- 2,495,277 3,394,156 -- --
Accrued dividends receivable 500,987 1,059,637 230,516 -- -- --
----------- ----------- ----------- ---------- ---------- ----------
Total assets 564,156,064 743,986,566 388,565,315 205,206,192 42,715,028 1,759,666
----------- ----------- ----------- ---------- ---------- ----------
Liabilities:
Payable for securities purchased -- -- -- -- -- --
Dividends payable -- -- -- -- 5,824 --
Accrued expenses 360,463 363,081 219,589 92,482 16,000 4,556
----------- ----------- ----------- ----------- ---------- ----------
Total liabilities 360,463 363,081 219,589 92,482 21,824 4,556
----------- ----------- ----------- ----------- ---------- ----------
Net assets applicable to
outstanding capital stock $563,795,601 $743,623,485 $388,345,726 $205,113,710 $42,693,204 $1,755,110
=========== =========== =========== =========== ========== ==========
Represented by:
Capital stock, par value $.01 $263,203 $244,226 $213,700 $191,061 $426,932 $1,841
Additional paid-in capital 445,389,683 547,421,202 325,187,831 200,953,049 42,266,272 1,522,576
Undistributed net investment
income 329,115 2,008,872 3,103,189 3,057,115 -- --
Undistributed net realized
gain (loss)on investments 879,351 2,244,876 (1,319,466) (682,307) -- --
Unrealized appreciation
(depreciation)on investments 116,934,249 191,704,309 61,160,471 1,594,792 -- 200,693
----------- ----------- ----------- ----------- ---------- ----------
Total net assets - representing net
assets applicable to outstanding
capital stock $563,795,601 $743,623,485 $388,345,726 $205,113,710 $42,693,204 $1,755,110
=========== =========== =========== =========== ========== ==========
Number of Class Z Shares issued and
outstanding (note 5) 26,320,320 24,422,578 21,370,036 19,106,131 42,693,204 184,138
=========== =========== =========== =========== ========== ==========
Net asset value per share of
outstanding capital stock (note 2) $21.42 $30.45 $18.17 $10.74 $1.00 $9.53
=========== =========== =========== =========== ========== ==========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CAPITAL APPRECIATION STOCK FUND OF ULTRA SERIES FUND
Investments in Securities
June 30, 1998
(Unaudited)
CAPITAL APPRECIATION STOCK % Net Quality Annualized Maturity Par
FUND INVESTMENTS: Assets Rating* Yield Date Amount Value
------ ------- ----- ---- ------ -----
Short-Term Investments:
<S> <C> <C> <C> <C> <C> <C>
Commercial Paper/Savings: 3.0%
American General Finance A-1/P-1 5.65% July 28, 1998 $2,000,000 $1,991,675
Anheuser Busch Companies A-1+/P-1 6.08% July 01, 1998 3,925,000 3,925,000
Consolidated Natural Gas A-1+/P-1 5.67% July 24, 1998 2,038,000 2,030,748
John Deere Capital Corp. A-1/P-1 5.63% July 14, 1998 2,000,000 1,996,006
Merrill Lynch & Co., Inc. A-1+/P-1 5.66% July 22, 1998 7,000,000 6,991,943
State Street Bank & Trust 5.00% 746 746
----------
TOTAL SHORT-TERM INVESTMENTS,
AT COST $16,936,118
----------
% Net
Long-Term Investments: Assets Shares Value
Common Stocks: 96.9%
Foreign Issues: 3.9%
Elan Corp PLC - ADR*** 118,100 $7,595,306
Glaxo Wellcome PLC - ADR 89,300 5,341,256
Telefonos de Mexico SP ADR - Cl L 191,000 9,179,938
---------
Foreign Issues total 22,116,500
---------
Domestic Issues:
Building Materials: 1.3%
Raychem Corporation 240,500 7,109,780
---------
Forest Products/Paper: 1.7%
Georgia-Pacific 79,400 4,679,638
Willamette Industries Inc. 155,900 4,988,800
---------
Forest Products/Paper total 9,668,438
---------
Insurance: 8.4%
The Allstate Corporation 96,882 8,870,758
Everest Reinsurance Holdings, Inc 189,650 7,289,672
Mutual Risk Management Ltd. 386,464 14,081,782
Travelers Group, Inc. 278,999 16,914,314
---------
Insurance total 47,156,526
---------
Banks: 2.2%
Banc One Corporation 120,320 6,715,360
Bankers Trust Corporation 49,600 5,756,700
---------
Banks total 12,472,060
---------
Investment Banking/Brokerage: 3.2%
A. G. Edwards, Inc. 214,300 9,147,931
Morgan Stanley Dean Witter and Co 98,600 9,009,575
---------
Investment Banking/
Brokerage total 18,157,506
---------
Drugs/Health Care: 8.6%
Aetna Inc. 162,400 12,362,700
ALZA Corporation 153,900 6,656,175
Biogen, Inc.*** 72,200 3,537,800
Bristol-Myers Squibb Company 60,300 6,930,731
Centocor, Inc.*** 131,700 4,774,125
Crescendo Pharmaceuticals
Corporation*** 6,260 79,424
Pharmacia & Upjohn, Inc. 167,500 7,725,938
United HealthCare Corporation 99,400 6,311,900
---------
Drugs/Health Care total 48,378,793
---------
Hospital Management/Supplies: 0.6%
Columbia/HCA Healthcare
Corporation 123,700 3,602,763
---------
<PAGE>
CAPITAL APPRECIATION STOCK FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
CAPITAL APPRECIATION STOCK % Net
FUND INVESTMENTS, CONTINUED: Assets Shares Value
Retail - Discount: 3.0%
Consolidated Stores Corporation*** 146,300 $ 5,303,375
The TJX Companies, Inc. 288,200 6,952,825
Wal-Mart Stores, Inc. 78,700 4,781,025
---------
Retail-Discount total 17,037,225
---------
Retail - Department: 4.0%
Dayton Hudson Corporation 308,600 14,967,100
Tiffany & Co. 155,200 7,449,600
---------
Retail - Department total 22,416,700
---------
Retail - Drug: 1.9%
Rite Aid Corporation 291,600 10,953,225
---------
Retail-Grocery: 2.7%
Safeway Inc.*** 367,600 14,956,725
---------
Media: 8.2%
Cox Communications, Inc.*** 240,100 11,629,844
MediaOne Group Inc.*** 546,500 24,011,844
PRIMEDIA Inc.*** 770,600 10,451,262
---------
Media total 46,092,950
---------
Foods - Products & Service: 4.3%
General Mills, Inc. 70,050 4,789,669
Nabisco Holdings Corp. - Class A 204,500 7,374,781
Sara Lee Corporation 74,400 4,161,750
Tyson Foods, Inc. - Class A 366,100 7,939,794
---------
Foods-Products & Service total 24,265,994
---------
Apparel/Textile: 0.9%
Nine West Group Inc.*** 188,400 5,051,475
---------
Office Equipment/Computers: 10.9%
3Com Corporation*** 183,900 5,643,432
EMC Corporation*** 492,300 22,061,194
Gateway 2000, Inc.*** 185,200 9,375,750
International Business Machines
Corporation 64,250 7,376,703
Seagate Technology, Inc.*** 151,700 3,612,356
Wang Laboratories, Inc.*** 526,250 13,386,484
---------
Office Equipment/Computers total 61,455,919
---------
Electronics-Semiconductors: 3.1%
Dallas Semiconductor Corporation 200,700 6,221,700
Micron Technology, Inc.*** 104,450 2,591,665
Texas Instruments Incorporated 144,300 8,414,494
---------
Electronics-Semiconductors total 17,227,859
---------
Pollution Control: 1.3%
Waste Management, Inc. 204,600 7,161,000
---------
Oil/Oil Service: 6.2%
EVI Weatherford Inc.*** 110,000 4,083,750
Kerr-McGee Corporation 109,000 6,308,375
Occidental Petroleum Corporation 296,550 8,006,850
Unocal Corporation 182,050 6,508,287
USX-Marathon Group 292,600 10,039,838
---------
Oil/Oil Service total 34,947,100
---------
<PAGE>
CAPITAL APPRECIATION STOCK FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
CAPITAL APPRECIATION STOCK % Net
FUND INVESTMENTS, CONTINUED: Assets Shares Value
Containers: 3.7%
Owens-Illinois, Inc.*** 469,400 $21,005,650
---------
Chemicals: 2.4%
The Dow Chemical Company 58,000 5,607,875
Praxair, Inc. 171,500 8,028,345
---------
Chemicals total 13,636,220
---------
Transportation: 3.0%
Delta Air Lines, Inc. 40,150 5,189,388
FDX Corporation*** 106,800 6,701,700
Midwest Express Holdings, Inc.*** 138,675 5,018,301
---------
Transportation total 16,909,389
---------
Telecommunications: 3.6%
AirTouch Communications, Inc.*** 343,550 20,076,202
---------
Utilities-Electric: 0.8%
PG& E Corporation 150,150 4,739,109
---------
Utilities-Natural Gas: 2.2%
Sonat, Inc. 136,800 5,283,900
The Williams Companies, Inc. 207,300 6,996,375
---------
Utilities-Natural Gas total 12,280,275
---------
Diversified Companies: 0.9%
Rockwell International Corporation 100,525 4,831,483
---------
Miscellaneous: 4.0%
Cognizant Corporation 121,300 7,641,900
Interim Services Inc.*** 456,400 14,661,850
---------
Miscellaneous total 22,303,750
---------
TOTAL COMMON STOCKS,
(COST: $429,076,368) $546,010,616
-----------
TOTAL INVESTMENTS, CAPITAL APPRECIATION
STOCK FUND (COST: $446,012,486) $562,946,734
===========
<FN>
See accompanying notes to investments in securities.
*Moody's/Standard & Poors' quality ratings (unaudited). See the current
Prospectus and Statement of Additional Information for a complete description of
these ratings.
**At June 30, 1998, the cost of securities for federal income tax purposes was
$446,052,720. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation.............................................. $133,022,414
Gross unrealized depreciation.............................................. (16,128,400)
-----------
Net unrealized appreciation................................................ $116,894,014
===========
Tax cost and appreciation differ from the financial statement by $40,234 due to
timing of dividend distributions.
***This Security is not income producing.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GROWTH AND INCOME STOCK FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
GROWTH AND INCOME STOCK % Net Quality Annualized Maturity Par
FUND INVESTMENTS: Assets Rating* Yield Date Amount Value
------ ------- ----- ---- ------ -----
<S> <C> <C> <C> <C> <C> <C>
Short-Term Investments:
Commercial Paper/Savings: 3.4%
American General Finance A-1/P-1 5.65% July 21, 1998 $3,000,000 $2,990,800
Anheuser Busch Companies A-1/P-1 5.55% July 07, 1998 4,000,000 3,996,326
Associates Corp NA A-1+/P-1 5.64% Aug 11, 1998 3,000,000 2,981,072
John Deere Capital Corp. A-1/P-1 5.58% July 28, 1998 2,000,000 1,991,720
General Electric Capital Corporation A-1+/P-1 5.64% Aug 04, 1998 300,000 2,984,332
Merrill Lynch & Co., Inc. A-1+/P-1 5.61% July 01, 1998 10,436,000 10,430,620
State Street Bank & Trust 5.00% 1,125 1,125
----------
TOTAL COMMERCIAL PAPER/
SAVINGS, AT COST $25,375,995
----------
% Net
Long-Term Investments: Assets Shares Value
Common Stocks: 94.2%
Foreign Issues: 2.9%
Glaxo Wellcome PLC - ADR 201,350 $12,043,247
Philips Electronics N.V. 113,700 9,664,500
---------
Foreign Issues total 21,707,747
---------
Domestic Issues:
Forest Products/Paper: 2.9%
Georgia-Pacific 152,200 8,970,287
Kimberly-Clark Corporation 269,400 12,358,725
---------
Forest Products/Paper total 21,329,012
---------
Insurance: 5.7%
The Allstate Corporation 183,684 16,818,566
Everest Reinsurance Holdings, Inc. 231,050 8,880,984
Travelers Group, Inc. 278,424 16,879,455
---------
Insurance total 42,579,005
---------
Banks: 6.7%
BankAmerica Corporation 128,200 11,081,288
Banc One Corporation 322,740 18,012,926
Bankers Trust Corporation 86,500 10,039,406
NationsBank Corporation 141,500 10,824,750
---------
Banks total 49,958,370
---------
Investment Banking/Brokerage: 2.7%
A. G. Edwards, Inc. 153,050 6,533,322
Morgan Stanley Dean Witter and Co. 146,400 13,377,300
---------
Investment Banking/Brokerage total 19,910,622
---------
Drugs/Health Care: 10.6%
Aetna Inc. 211,000 16,062,375
American Home Products Corporation 416,200 21,538,350
Bristol-Myers Squibb Company 170,400 19,585,350
Pharmacia & Upjohn, Inc. 201,700 9,303,413
Tenet Healthcare Corporation*** 383,800 11,993,750
---------
Drugs/Health Care total 78,483,238
---------
Retail - Department: 2.0%
Sears, Roebuck & Co. 246,300 15,039,694
---------
Retail - Discount: 2.9%
Wal-Mart Stores, Inc. 354,200 21,517,650
---------
<PAGE>
GROWTH AND INCOME STOCK FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
GROWTH AND INCOME STOCK % Net
FUND INVESTMENTS, CONTINUED: Assets Shares Value
Retail - Drug: 1.6%
CVS Corporation 306,706 $11,942,365
---------
Media: 4.2%
Cox Communications, Inc.*** 156,500 7,580,469
MediaOne Group Inc.*** 545,200 23,954,725
---------
Media total 31,535,194
---------
Foods - Products & Service: 6.1%
General Mills, Inc. 199,100 13,613,463
Nabisco Holdings Corp. - Class A 367,700 13,260,181
Sara Lee Corporation 178,000 9,956,875
Tyson Foods, Inc. - Class A 382,725 8,300,348
---------
Foods - Products & Service total 45,130,867
---------
Auto-Related: 1.7%
Echlin Inc. 147,300 7,226,906
General Motors Corporation 81,150 5,421,834
---------
Auto-Related total 12,648,740
---------
Office Equipment/Computers: 8.7%
Computer Associates
International, Inc. 285,000 15,835,312
EMC Corporation*** 469,100 21,021,544
Hewlett-Packard Company 175,300 10,496,088
International Business
Machines Corporation 153,000 17,566,312
---------
Office Equipment/Computers total 64,919,256
---------
Electronics: 4.5%
Harris Corporation 250,400 11,189,750
Motorola, Inc. 182,200 9,576,888
Texas Instruments Incorporated 219,400 12,793,762
---------
Electronics total 33,560,400
---------
Aerospace/Defense: 1.4%
United Technologies Corporation 115,300 10,665,250
---------
Pollution Control: 1.2%
Waste Management, Inc. 243,750 8,531,250
---------
Oil/Oil Service: 7.8%
Amoco Corporation 185,200 7,708,950
Exxon Corporation 141,200 10,069,325
Occidental Petroleum Corporation 248,150 6,700,050
Schlumberger Limited 139,000 9,495,438
Texaco Inc. 121,100 7,228,156
Unocal Corporation 198,750 7,105,313
USX-Marathon Group 291,550 10,003,809
---------
Oil/Oil Service total 58,311,041
---------
Containers: 4.2%
Crown Cork & Seal Company, Inc. 364,400 17,309,000
Owens-Illinois, Inc.*** 309,500 13,850,125
---------
Containers total 31,159,125
---------
Chemicals: 3.1%
The Dexter Corporation 246,700 7,848,144
The Dow Chemical Company 155,550 15,039,740
---------
Chemicals total 22,887,884
---------
<PAGE>
GROWTH AND INCOME STOCK FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
GROWTH AND INCOME STOCK % Net
FUND INVESTMENTS, CONTINUED: Assets Shares Value
Transportation: 1.0%
Delta Air Lines, Inc. 55,450 $7,166,913
---------
Railroad Equipment: 1.9%
Burlington Northern Santa Fe
Corporation 73,400 7,206,963
Norfolk Southern Corporation 227,700 6,788,306
---------
Railroad Equipment total 13,995,269
---------
Telecommunications: 3.1%
AirTouch Communications, Inc.*** 207,100 12,102,406
Sprint Corporation 157,600 11,110,800
---------
Telecommunications total 23,213,206
---------
Utilities-Telephone: 3.5%
Ameritech Corporation 225,900 10,137,263
Bell Atlantic Corporation 135,300 6,173,063
GTE Corporation 179,950 10,009,718
---------
Utilities-Telephone total 26,320,044
---------
Utilities-Electric: 2.5%
Duke Energy Corporation 100,900 5,978,325
Northern States Power Company 188,400 5,392,950
PG&E Corporation 232,300 7,331,969
---------
Utilities-Electric total 18,703,244
---------
Utilities-Natural Gas: 1.5%
The Williams Companies, Inc. 325,800 10,995,750
---------
Diversified Companies: 2.0%
Rockwell International Corporation 177,875 8,549,117
General Signal Corporation 169,000 6,084,000
---------
Diversified Companies total 14,633,117
---------
TOTAL COMMON STOCKS
(COST: $525,139,944) $716,844,253
-----------
TOTAL INVESTMENTS, GROWTH AND
INCOME STICK FUND (COST: $550,515,939) $742,220,248
===========
See accompanying notes to investments in securities.
<FN>
*Moody's/Standard & Poors' quality ratings (unaudited). See the current
Prospectus and Statement of Additional Information for a complete description of
these ratings.
**At June 30, 1998, the cost of securities for federal income tax purposes was
$550,515,939. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation.............................................. $202,700,643
Gross unrealized depreciation.............................................. (10,996,334)
-----------
Net unrealized appreciation................................................ $191,704,309
===========
***This Security is not income producing.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
% Net Quality Annualized Maturity Par
BALANCED FUND INVESTMENTS: Assets Rating* Yield Date Amount Value
------ ------- ----- ---- ------ -----
Short-Term Investments:
<S> <C> <C> <C> <C> <C> <C>
Commercial Paper/Savings: 5.6%
Anheuser Busch Companies A1/P1 5.61% July 14, 1998 $3,000,000 $2,994,020
Coca-Cola Company A1+/P1 5.61% July 07, 1998 5,000,000 4,995,408
Consolidated Natural Gas A1+/P1 5.66% July 24, 1998 5,000,000 4,982,239
Ford Motor Credit Company A1/P1 5.63% July 01, 1998 3,000,000 3,000,000
Merrill Lynch Capital Markets A1+/P1 6.02% July 01, 1998 5,731,000 5,724,490
State Street Bank & Trust 5.00% 1,247 1,247
----------
TOTAL COMMERCIAL PAPER/
SAVINGS, AT COST $21,697,404
----------
% Net Quality Coupon Maturity Par
U.S. Government & Agency Bonds: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Government Guaranteed: 4.9%
U.S. Treasury Notes AAA 8.500 Feb 15, 2000 $500,000 $ 522,813
U.S. Treasury Notes AAA 7.500 Nov 15, 2001 1,000,000 1,059,376
U.S. Treasury Notes AAA 5.875 Feb 15, 2004 950,000 968,110
U.S. Treasury Notes AAA 5.750 Aug 15, 2003 800,000 808,750
U.S. Treasury Notes AAA 6.500 May 15, 2005 1,100,000 1,161,532
U.S. Treasury Notes AAA 6.500 Aug 15, 2005 700,000 739,156
U.S. Treasury Notes AAA 5.875 Nov 15, 2005 7,000,000 7,137,816
U.S. Treasury Notes AAA 5.750 Apr 30, 2003 4,700,000 4,747,005
U.S. Treasury Notes AAA 5.625 Feb 15, 2006 2,000,000 2,008,752
----------
TOTAL GOVERNMENT GUARANTEED
(COST:$18,910,739) $19,153,310
----------
Quasi-Government/Government Sponsored: 6.8%
Federal Home Loan Bank
CPI Floating Rate AAA 5.421 Feb 20, 2007 $5,000,000 $ 4,752,850
Federal Home Loan Mortgage Corp.
1455 HA AAA 7.900 Jun 15, 2021 3,344,000 3,631,470
Federal Home Loan Mortgage Corp.
1378 H AAA 10.000 Jan 15, 2021 2,250,000 2,534,398
Federal Home Loan Mortgage Corp.
1978 AD AAA 7.000 Apr 15, 2025 2,045,655 2,068,585
Federal National Mortgage Assn.
89-82 G AAA 8.400 Nov 25, 2019 1,600,000 1,667,835
Federal National Mortgage Assn.
Strip 282-2**** AAA 7.000 Sep 01, 2025 7,072,659 1,796,307
Federal National Mortgage Assn.
97-29 PL**** AAA 7.500 Aug 18, 2026 8,000,000 2,601,936
Federal National Mortgage Assn.
96-M6 G AAA 7.750 Sep 17, 2023 4,000,000 4,225,000
Federal National Mortgage Assn.
97-57 PT**** AAA 8.000 Mar 18, 2024 8,000,000 1,795,352
Federal National Mortgage Assn.
Strip 272-2**** AAA 7.500 July 01, 2026 6,322,901 1,149,567
----------
TOTAL QUASI-GOVERNMENT/GOVERNMENT
SPONSORED (COST:$28,100,678) $26,223,300
----------
Sovereign Issues: 1.7%
Brazil - Global B-1/BB 8.875 Nov 05, 2001 $2,500,000 $2,493,750
Columbia, Republic BAA-3/BBB- 7.250 Feb 23, 2004 3,000,000 2,804,055
United Mexican States Ba-2/BB 9.875 Jan 15, 2007 1,300,000 1,362,400
----------
TOTAL SOVEREIGN ISSUES (COST:$6,914,884) $6,660,205
----------
U.S Corporate Bonds: 29.4%
Building Materials: 0.1%
Stanley Works A-2/A 7.375 Dec 15, 2002 $250,000 $263,461
---------
Drug/Health Care: 0.6%
Abbott Laboratories, Inc. AA-1/AAA 6.800 May 15, 2005 500,000 526,292
American Home Products, Corp. A-2/A 7.700 Feb 15, 2000 1,050,000 1,077,737
Bergen Brunswig BAA-1/A- 7.250 Jun 01, 2005 500,000 529,462
Bergen Brunswig BAA-1/A- 7.375 Jan 15, 2003 113,000 118,484
---------
Drug/Health Care total 2,251,975
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Electronics: 0.3%
Motorola Inc AA-3/AA 6.500 Sep 01, 2025 $ 50,000 $ 52,558
Raytheon Co. BAA-1/BBB 6.500 Jul 15, 2005 530,000 541,626
Texas Instruments, Inc. A-3/A 9.000 Mar 15, 2001 500,000 537,453
---------
Electronics total 1,131,637
---------
Forest Products/Paper: 3.6%
Carter Holt Harvery BAA-2/BBB+ 8.875 Dec 01, 2004 2,800,000 3,182,698
Champion International Corp. BAA-1/BBB 6.400 Feb 15, 2026 6,000,000 6,162,828
International Paper A-3/A- 7.500 May 15, 2004 2,800,000 2,983,285
Kimberly Clark Corp. AA-2/AA 9.000 Aug 01, 2000 750,000 794,891
Weyerhaeuser Company A-2/A 8.375 Feb 15, 2007 800,000 912,133
---------
Forest Products/Paper total 14,035,835
---------
Hospital Supplies: 1.0%
Baxter International, Inc. A-3/A 7.625 Nov 15, 2002 250,000 264,469
Columbia/HCA Healthcare Corporation BAA-2/BBB 6.125 Dec 15, 2000 1,000,000 970,339
Columbia/HCA Healthcare Corporation BAA-2/BBB 8.020 Aug 05, 2002 2,000,000 2,007,330
Columbia/HCA Healthcare Corporation BAA-2/BBB 6.910 Jun 15, 2005 700,000 677,201
---------
Hospital Supplies total 3,919,339
---------
Insurance/Casualty: 2.7%
Aetna Services A-2/A 7.125 Aug 15, 2006 2,800,000 2,922,007
Equitable Life Assoc A-2/A 6.950 Dec 01, 2005 1,050,000 1,090,783
Hartford Life A-2 7.100 June 15, 2007 3,500,000 3,682,983
Lincoln National Corp. A-2/A 6.500 Mar 15, 2008 2,400,000 2,428,210
Lincoln National Corp. A-2/A 7.250 May 15, 2005 500,000 526,870
---------
Insurance/Casualty total 10,650,853
---------
Investment Banking/Brokerage: 3.1%
Donaldson, Lufkin Jenrette, Inc. A-3/A- 6.875 Nov 01, 2005 300,000 310,320
Merrill Lynch & Co., Inc. AA-3/AA- 6.250 Jan 15, 2006 650,000 654,914
Merrill Lynch & Co., Inc. AA-3/AA- 7.000 Mar 15, 2006 1,000,000 1,049,450
Merrill Lynch & Co., Inc. AA-3/AA- 7.375 May 15, 2006 3,000,000 3,220,293
Paine Webber Group BAA-1/BBB+ 6.750 Feb 01, 2006 1,000,000 1,022,564
Salomon Inc. A-2/A 7.375 May 15, 2007 3,800,000 4,071,095
Salomon Inc. A-2/A 7.200 Feb 01, 2004 1,500,000 1,567,835
---------
Investment Banking/Brokerage total 11,896,471
---------
Finance Co. - Consumer Loan: 1.7%
American General Finance A-2/A+ 7.125 Dec 01, 1999 500,000 508,048
Household Finance Co. A-2/A 7.125 Sep 01,2005 500,000 523,472
Norwest Financial Inc. AA-3/AA- 7.875 Feb 15, 2002 500,000 531,076
---------
Finance Co. - Consumer Loan total 1,562,596
---------
Mortgage Related Securities: 6.7%
Chase Commerical Mortgage Security A/A 6.600 Dec 19, 2007 4,800,000 4,837,992
Deutsche Mortgage A/A-2 6.861 Mar 15, 2008 5,000,000 5,133,525
First Plus Home Loan Aaa/AAA 6.490 July 10, 2017 4,891,000 4,943,602
First Union Lehman Brothers A/A-2 7.440 Apr 18, 2029 5,500,000 5,827,718
GMAC Commerical Mortgage Baa/BBB 7.730 Oct 15, 2028 5,204,500 5,489,785
Residential Funding Aaa/AAA 6.220 July 25, 2013 4,800,000 4,804,500
---------
Mortgage Related Securities total 31,037,122
---------
Media: 0.2%
Cox Communications BAA-2/A- 6.875 Jun 15, 2005 500,000 519,436
McGraw-Hill, Inc. A-1 9.430 Sep 01, 2000 250,000 266,382
---------
Media total 785,818
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Publishing-News: 0.1%
Knight Ridder, Inc. A-3/A 8.500 Sep 01, 2001 $500,000 $513,836
---------
Retail-Department: 0.1%
Dayton Hudson Corp. BAA-1/BBB+ 9.750 Nov 01, 1998 500,000 505,812
---------
Foods-Products & Services: 0.5%
Nabisco Holdings Corporation BAA-2/BBB 6.850 June 15, 2005 2,000,000 2,041,072
---------
Auto-Related: 1.7%
Borg-Warner Automotive BAA-2/BBB+ 7.000 Nov 01, 2006 1,150,000 1,203,504
Ford Motor Company A-1/A 7.500 Nov 15, 1999 500,000 509,052
Ford Motor Company A-1/A 6.000 Jan 14, 2003 4,800,000 4,787,491
---------
Auto-Related total 6,500,047
---------
Electric Household Appliances: 0.1%
Maytag Corporation A-3/BBB+ 9.750 May 15, 2002 250,000 280,808
---------
Finance-Diversified: 0.1%
Associate Corp of N America AA-3/AA- 5.250 Sep 01, 1998 40,000 39,963
Dow Capital B.V. A-1/A 7.125 Jan 15, 2003 250,000 261,143
---------
Finance-Diversified total 301,106
---------
Engineering/Construction Services: 0.3%
Foster Wheeler Corp. BAA-2/BBB 6.750 Nov 15, 2005 1,020,000 1,031,035
---------
Machinery/Tools: 0.1%
Giddings & Lewis BA-1 7.500 Oct 01, 2005 500,000 532,286
---------
Office Equipment/Computers: 0.1%
Xerox Corporation A-2/A 7.150 Aug 01, 2004 300,000 317,147
---------
Oil/Oil Service: 0.6%
Enron Corp. BAA-2/BBB+ 7.625 Sep 10, 2004 500,000 536,628
Mobil Corporation AA-2/AA 8.375 Feb 12, 2001 500,000 526,875
Shell Canada, Ltd. AA-2/AA 8.875 Jan 14, 2001 500,000 534,905
Union Oil California BAA-1/BBB+ 7.200 May 15, 2005 500,000 528,629
---------
Oil/Oil Service total 2,127,037
---------
Chemicals: 0.3%
PPG Industries, Inc. A-1/A 6.875 Aug 01, 2005 500,000 527,499
Union Carbide Corporation BAA-2/BBB 6.790 Jun 01, 2025 700,000 720,086
---------
Chemicals total 1,247,585
---------
Specialty Chemicals: 0.1%
Praxair, Inc. A-3/BBB+ 6.850 Jun 15, 2005 500,000 519,818
---------
Transportation: 1.9%
American Airlines A-3/BBB 8.040 Sep 16, 2011 1,000,000 1,091,345
Burlington Northern Inc. BAA-2/BBB 7.400 May 15, 1999 500,000 505,874
Delta Air Lines BAA-1/BBB 8.540 Jan 02, 2007 1,408,928 1,527,968
Federal Express A-3/BBB+ 7.850 Jan 30, 2015 977,180 1,085,672
Federal Express A-3/BBB+ 7.890 Sep 23, 2008 500,000 538,073
Golden State Petroleum Transport Corp. AA-2/BB+ 8.040 Feb 01, 2019 2,000,000 2,215,264
United Airlines Baa-1/BBB 9.020 Apr 19, 2012 462,541 537,123
---------
Transportation total 7,501,319
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Aerospace/Defense: 0.8%
Northrop - Grumman BAA-3/BBB+ 7.000 Mar 01, 2006 $3,000,000 $3,117,987
---------
Utilities-Telephone: 1.2%
Alltel Corporation A-2/A+ 7.250 Apr 01, 2004 500,000 525,234
GTE-Hawaii BAA-2/A 7.375 Sept 01, 2003 3,000,000 3,198,936
GTE Corporation BAA-1/A 9.100 Jun 01, 2003 500,000 562,693
Northwestern Bell Telephone Co. AA-3/A 9.500 May 01, 2000 250,000 265,342
---------
Utilities-Telephone total 4,552,205
---------
Utilities-Electric: 0.4%
Midwest Power Systems A-2/AA- 7.125 Feb 01, 2003 250,000 260,835
Pacific Gas & Electric Co. A-1/AA- 6.250 Aug 01, 2003 300,000 303,111
Pacificorp A-2/A 6.750 Apr 01, 2005 500,000 513,958
Wisconsin Public Service, Inc. AA-2/AA+ 7.300 Oct 01, 2002 500,000 525,566
---------
Utilities-Electric total 1,603,470
---------
Utilities-Natural Gas Pipeline: 1.1%
Burlington Resources Inc. A-3/A- 9.625 Jun 15, 2000 250,000 266,437
Cincinnati Gas & Electric A-3/A- 6.450 Feb 15, 2004 1,000,000 1,017,188
Transcontinental Gas A-2/BBB 6.125 Jan 15, 2005 2,800,000 2,795,139
---------
Utilities-Natural Gas Pipeline total 4,078,764
---------
Pollution Control 0.8%
WMX Technologies BAA-1/BBB 7.000 May 15, 2005 2,900,000 2,997,452
---------
Metals/Copper 0.4%
Magma Copper A-2 8.700 May 15, 2005 1,400,000 1,590,548
---------
Diversified Companies: 0.1%
Whitman Corporation BAA-2/BBB+ 7.500 Feb 01, 2003 300,000 315,405
---------
TOTAL U.S. CORPORATE BONDS,
AT COST: ($116,472,410) $119,209,846
-----------
% Net
Assets Shares Value
Common Stocks: 49.6%
Foreign Issues: 1.5%
Glaxo Wellcome PLC - ADR 38,150 $2,281,846
Philips Electronics N.V. 18,500 1,572,500
Telefonos de Mexico SP ADR - Cl L 39,000 1,874,438
---------
Foreign Issues total 5,728,784
---------
Building Materials: 0.6%
Raychem Corporation 72,300 2,137,369
---------
Forest Products/Paper: 1.3%
Georgia-Pacific Group 26,400 1,555,950
Kimberly-Clark Corporation 44,700 2,050,613
Willamette Industries Inc. 49,800 1,593,600
---------
Forest Products/Paper total 5,200,163
---------
Insurance: 2.7%
The Allstate Corporation 45,357 4,153,000
Everest Reinsurance Holdings, Inc. 45,500 1,748,906
Travelers Group, Inc. 73,086 4,430,839
---------
Insurance total 10,332,745
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net
CONTINUED: Assets Shares Value
Banks: 2.9%
Banc One Corporation 62,390 $ 3,482,142
BankAmerica Corporation 23,300 2,013,994
Bankers Trust Corporation 21,000 2,437,312
NationsBank Corporation 42,600 3,258,900
---------
Banks total 11,192,348
---------
Investment Banking/Brokerage: 1.3%
A. G. Edwards, Inc. 54,600 2,330,738
Morgan Stanley Dean Witter and Co. 29,400 2,686,425
---------
Investment Banking/Brokerage total 5,017,163
---------
Drugs/Health Care: 5.1%
Aetna Inc. 58,400 4,445,700
American Home Products Corporation 95,600 4,947,300
Bristol-Myers Squibb Company 40,200 4,620,488
Centocor, Inc.*** 39,100 1,417,375
Pharmacia & Upjohn, Inc. 52,000 2,398,500
United HealthCare Corporation 32,300 2,051,050
---------
Drugs/Health Care total 19,880,413
---------
Hospital Management/Supplies: 0.4%
Columbia/HCA Healthcare Corporation 58,450 1,702,356
---------
Retail-Deptarment: 2.3%
Dayton Hudson Corporation 72,800 3,530,800
Sears, Roebuck & Co. 45,700 2,790,556
Tiffany & Co. 57,000 2,736,000
---------
Retail-Deptarment total 9,057,356
---------
Retail - Discount: 1.0%
Wal-Mart Stores, Inc. 66,200 4,021,650
---------
Retail - Drug: 0.7%
CVS Corporation 74,252 2,891,187
---------
Retail - Grocery: 0.8%
Safeway Inc.*** 72,600 2,953,913
---------
Media: 3.2%
Cox Communications, Inc.*** 66,700 3,230,781
MediaOne Group Inc.*** 159,100 6,990,456
PRIMEDIA Inc. 171,500 2,325,969
---------
Media total 12,547,206
---------
Foods - Products & Services: 2.7%
General Mills, Inc. 38,400 2,625,600
Nabisco Holdings Corp. - Class A 99,900 3,602,644
Sara Lee Corporation 30,300 1,694,906
Tyson Foods, Inc. - Class A 113,825 2,468,580
---------
Foods-Food Products total 10,391,730
---------
Auto-Related: 0.4%
General Motors Corporation 21,600 1,443,150
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net
CONTINUED: Assets Shares Value
Office Equipment/Computers: 5.5%
EMC Corporation*** 127,800 $ 5,727,037
Gateway 2000, Inc.*** 47,200 2,389,500
Hewlett-Packard Company 35,700 2,137,538
International Business Machines Corporation 41,600 4,776,200
Seagate Technology, Inc.*** 38,000 904,875
3Com Corporation*** 82,600 2,534,788
Wang Laboratories, Inc. *** 112,500 2,861,718
---------
Office Equipment/Computers total 21,331,656
---------
Electronics: 1.5%
Micron Technology, Inc.*** 37,450 929,228
Motorola, Inc. 48,400 2,544,025
Texas Instruments Incorporated 40,000 2,332,500
---------
Electronics total 5,805,753
---------
Pollution Control: 0.5%
Waste Management, Inc. 55,900 1,956,500
---------
Oil/Oil Service: 4.0%
Amoco Corporation 45,300 1,885,612
Exxon Corporation 32,000 2,282,000
Kerr-McGee Corporation 30,100 1,742,038
Occidental Petroleum Corporation 56,600 1,528,200
Schlumberger Limited 35,600 2,431,925
Unocal Corporation 86,200 3,081,650
USX-Marathon Group 72,400 2,484,225
---------
Oil/Oil Service total 15,435,650
---------
Containers: 1.7%
Crown Cork & Seal Company, Inc.*** 39,200 1,862,000
Owens-Illinois, Inc.*** 108,500 4,855,375
---------
Containers total 6,717,375
---------
Chemicals: 1.3%
The Dow Chemical Company 24,800 2,397,850
Praxair, Inc. 54,600 2,555,963
---------
Chemicals total 4,953,813
---------
Transportation: 1.0%
Delta Air Lines, Inc. 12,000 1,551,000
FDX Corporation*** 35,900 2,252,725
---------
Transportation total 3,803,725
---------
Railroad Equipment: 0.5%
Norfolk Southern Corporation 60,100 1,791,731
---------
Aerospace/Defense: 0.5%
United Technologies Corporation 21,800 2,016,500
---------
Telecommunications: 1.4%
AirTouch Communications, Inc.*** 95,850 5,601,234
---------
Utilities-Telephone: 1.8%
Ameritech Corporation 53,000 2,378,375
Bell Atlantic Corporation 50,000 2,281,250
GTE Corporation 44,100 2,453,063
---------
Utilities-Telephone total 7,112,688
---------
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BALANCED FUND INVESTMENTS, % Net
CONTINUED: Assets Shares Value
Utilities-Electric: 0.8%
Northern States Power Company 58,200 $1,665,975
PG&E Corporation 48,050 1,516,578
---------
Utilities-Electric total 3,182,553
---------
Utilities-Natural Gas: 0.7%
The Williams Companies, Inc. 79,900 2,696,625
---------
Diversified Companies: 0.4%
Rockwell International Corporation 32,500 1,562,031
---------
Miscellaneous: 1.1%
Cognizant Corporation 31,300 1,971,900
Interim Services Inc.*** 70,100 2,251,963
---------
Miscellaneous total 4,223,863
---------
TOTAL COMMON STOCKS,
AT COST: ($132,376,709) $192,689,230
-----------
TOTAL INVESTMENTS, BALANCED FUND
(COST: $324,472,824) $385,633,295
===========
<FN>
See accompanying notes to investments in securities.
*Moody's/Standard & Poors' quality ratings (unaudited). See the current
Prospectus and Statement of Additional Information for a complete description of
these ratings.
**At June 30, 1998, the cost of securities for federal income tax purposes
was $324,472,824. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation............................................... $67,147,812
Gross unrealized depreciation............................................... (5,987,341)
---------
Net unrealized appreciation................................................. $61,160,471
==========
***This security is not income producing.
****This security provides a claim on the interest component of the underlying
mortgages, but not on their principal component. That is, the security's cash
flows depend on the amount of principal outstanding at the payment date. If
prepayments on the underlying mortgages are higher than expected, the yield on
the security may be adversely affected.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BOND FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
% Net Quality Annualized Maturity Par
BOND FUND INVESTMENTS: Assets Rating* Yield Date Amount Value
------ ------- ----- ---- ------ -----
Short-Term Investments:
<S> <C> <C> <C> <C> <C> <C>
Commercial Paper/Savings: 1.5%
Anheuser Bush Companies A-1/P-1 6.08% July 01,1998 $3,000,000 $3,000,000
State Street Bank & Trust 5.00% 1,221 1,221
---------
TOTAL SHORT-TERM INVESTMENTS,
AT COST $3,001,221
---------
% Net Quality Coupon Maturity Par
Assets Rating* Rate Date Amount Value
U.S. Government & Agency Bonds:
Government Guaranteed: 9.8%
Private Export Funding AAA 5.650 Mar 15, 2003 $250,000 $249,873
U.S. Treasury Note AAA 5.750 Aug 15, 2003 5,300,000 5,357,971
U.S. Treasury Note AAA 5.625 Apr 30, 2000 10,000,000 10,021,880
U.S. Treasury Note AAA 5.500 Mar 31, 2003 4,500,000 4,498,596
----------
Government Guaranteed total
(COST: $20,039,532) $20,128,320
----------
Quasi-Government/Government Sponsored: 4.4%
Federal Home Loan Bank
CPI Floating Rate AAA 5.421 Feb 20, 2007 $2,000,000 $1,901,140
Federal Home Loan Mortgage Corp.
1455 HA AAA 7.900 Jun 15, 2021 836,000 907,868
Federal Home Loan Mortgage Corp.
1378 H AAA 10.000 Jan 15, 2021 750,000 844,799
Federal Home Loan Mortgage Corp.
1978 AD AAA 7.000 Apr 15, 2025 1,000,000 1,011,209
Federal Home Loan Mortgage Corp.
Strip 282 2*** AAA 7.000 Sep 01, 2025 1,768,164 449,076
Federal National Mortgage Association
89-82 G AAA 8.400 Nov 25, 2019 400,000 416,959
Federal National Mortgage Association
96-M6 G AAA 7.750 Sep 17, 2023 1,000,000 1,056,250
Federal National Mortgage Association
97-29 PL*** AAA 7.500 Aug 18, 2026 4,000,000 1,300,968
Federal National Mortgage Association
97-57 PT*** AAA 8.000 Mar 18, 2024 4,000,000 897,676
Federal National Mortgage Association
Strip 272 2*** AAA 7.500 Jul 01, 2026 1,580,725 287,392
---------
Quasi-Government/Government
Sponsored total(COST: $9,905,032) $9,073,337
---------
Non - U.S. Government Bonds:
Canadian Provincials: 2.2%
Nova Scotia Prov of A-3/A- 9.735 Jul 15, 2002 $1,000,000 $1,120,110
Ontario, Province of AA-3/AA- 7.750 Jun 04, 2002 1,000,000 1,064,450
Quebec Province of A-2/A+ 9.125 Mar 01, 2000 250,000 262,730
Saskatchewan Province of A-3/A 7.125 Mar 15, 2008 2,000,000 2,150,820
---------
Canadian Provincials total 4,598,110
---------
Sovereign Issues: 1.9%
Brazil - Global B-1/BB- 8.875 Nov 05, 2001 500,000 498,750
Columbia, Republic BAA-3/BBB- 7.250 Feb 23, 2004 2,000,000 1,869,370
United Mexican States Ba2/BB 9.875 Jan 15, 2007 1,500,000 1,572,000
---------
Sovereign Issues total 3,940,120
---------
TOTAL NON - U.S. GOVERNMENT BONDS,
(COST: $8,559,294) $8,538,230
---------
U.S. Corporate Bonds: 70.3%
Forest Products/Paper: 5.2%
Boise Cascade Corp. BAA-3/BBB- 9.450 Nov 01, 2009 $500,000 $ 602,877
Boise Cascade Corp. BAA-3/BBB- 9.875 Feb 15, 2001 500,000 507,603
Carter Holt Harvey BAA-2/BBB+ 8.875 Dec 01, 2004 1,000,000 1,136,678
Champion International Corp. BAA-1/BBB 6.400 Feb 15, 2026 6,000,000 6,162,828
Chesapeake Corp. BAA-3/BBB 7.200 Mar 15, 2005 1,000,000 1,045,991
Kimberly-Clark Corp. AA-2/AA 9.000 Aug 01, 2000 600,000 635,912
Scott Paper-Defeased AA-3/AA 10.000 Mar 01, 2002 500,000 566,837
---------
Forest Products/Paper total 10,658,726
---------
<PAGE>
BOND FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BOND FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Investment Banking/Brokerage: 13.2%
Bear Stearns A-2/A 6.750 Apr 15, 2003 $1,000,000 $ 1,024,429
Dean Witter Discover A-1/A+ 6.750 Oct 15, 2013 2,500,000 2,587,668
Dean Witter Discover A-1/A+ 6.300 Jan 15, 2006 1,000,000 1,005,755
Donaldson, Lufkin, Jenrette, Inc. A-3/A- 6.875 Nov 01, 2005 700,000 724,080
Lehman Brothers Holdings BAA-1/A 7.125 Sep 15, 2003 1,000,000 1,040,590
Lehman Brothers Holdings BAA-1/A 6.088 Sep 10, 2001 1,000,000 999,425
Merrill Lynch & Co., Inc. AA-3/AA- 6.250 Jan 15, 2006 350,000 352,646
Paine Webber Group BAA-1/BBB+ 6.750 Feb 01, 2006 700,000 715,795
Paine Webber Inc. BAA-1/BBB+ 7.875 Feb 15, 2003 1,000,000 1,065,050
Salomon Inc. A-2/A 7.375 May 15, 2007 1,000,000 1,071,341
Salomon Inc. A-2/A 7.200 Feb 01, 2004 3,500,000 3,658,281
Salomon Inc. A-2/A 7.500 Feb 01, 2003 2,000,000 2,107,900
---------
Investment Banking/Brokerage total 16,352,960
---------
Finance Co. - Consumer Loans: 3.3%
Household Finance Co. A-2/A 7.125 Sep 01, 2005 1,735,000 1,816,446
---------
Finance/Insurance: 1.9%
Aetna Services A-2/A 7.125 Aug 15, 2006 3,000,000 3,130,722
Equitable Life Assurance A-2/A 6.950 Dec 01, 2005 792,000 822,762
---------
Finance/ Insurance total 3,953,484
---------
Finance - Diversified: 1.5%
Ameritech Capital AA-3/AA+ 7.500 Apr 01, 2005 2,000,000 2,166,916
Dow Capital A-1/A 7.125 Jan 15, 2003 900,000 940,115
---------
Finance - Diversified total 3,107,031
---------
Mortgage Related Securities: 2.3%
Chase Commerical Mortgage Security A/A 6.600 Dec 19, 2007 4,800,000 4,837,992
Deutsche Mortgage A/A-2 6.861 June 15, 2031 5,000,000 5,133,525
First Plus Home Loan Aaa/AAA 6.490 July 10, 2017 5,000,000 5,053,775
First Union Lehman Brothers A/A-2 7.440 Apr 18, 2029 5,500,000 5,827,717
GMAC Commerical Mortgage Baa/BBB 7.73 Oct 15, 2028 5,204,500 5,489,785
Residential Funding Aaa/AAA 6.220 July 25, 2013 4,800,000 4,804,500
---------
Mortgage Related Securities total 31,147,294
---------
Drugs/Health Care: 0.3%
American Home Products A-2/A 7.700 Feb 15, 2000 530,000 544,000
---------
Hospital Management/Supplies 2.5%
Columbia/HCA Healthcare Corporation BAA-2/BBB 6.125 Dec 15, 2000 1,800,000 1,746,610
Columbia/HCA Healthcare Corporation BAA-2/BBB 8.020 Aug 05, 2002 3,000,000 3,010,995
Columbia/HCA Healthcare Corporation BAA-2/BBB 6.910 Jun 15, 2005 300,000 290,229
---------
Hospital Management/Supplies total 5,047,834
---------
Media: 0.1%
McGraw-Hill, Inc. A-1 9.430 Sep 01, 2000 100,000 106,553
---------
Publishing-News: 0.3%
Knight Ridder A-3/A 8.500 Sep 01, 2001 530,000 544,666
---------
Packaged Food Products 1.4%
Nabisco, Inc. BAA-2/BBB 6.85 June 15, 2005 2,800,000 2,857,501
---------
Retail-Department: 0.3%
Dayton Hudson Corp. BAA-1/BBB+ 9.750 Nov 01, 1998 250,000 252,906
Dayton Hudson Corp. BAA-1/BBB+ 7.250 Sep 01, 2004 310,000 328,609
---------
Retail-Department total 581,515
<PAGE>
BOND FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BOND FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Auto-Related: 3.7%
Ford Motor Co. A-1/A 7.500 Nov 15, 1999 $1,500,000 $1,527,158
Ford Motor Co. A-1/A 6.000 Jan 14, 2003 4,800,000 4,787,491
Hertz Corp A-3/BBB+ 9.000 Nov 01, 2009 1,000,000 1,252,267
---------
Auto-Related total 7,566,916
---------
Electronics: 1.9%
Motorola Inc. AA-3/AA 6.500 Sep 01, 2025 1,975,000 2,076,027
Xerox Corporation A-2/A 7.150 Aug 01, 2004 1,700,000 1,797,165
---------
Electronics total 3,873,192
---------
Aerospace/Defense: 2.1%
Lockheed Martin A-3/BBB+ 6.500 April 15, 2003 1,150,000 1,170,096
Lockheed Corp A-3/BBB+ 9.375 Oct 15, 1999 500,000 520,080
Northrop Grumman BAA-3/BBB+ 7.000 March 01, 2006 2,000,000 2,078,658
Raytheon Co. BAA-1/BBB 6.500 Jul 15, 2005 500,000 510,968
---------
Aerospace/Defense total 4,279,802
---------
Electric Household Appliance: 0.3%
Maytag Corporation A-3/BBB+ 9.750 May 15, 2002 600,000 673,939
---------
Engineering/Construction Services: 0.8%
Foster Wheeler Corp. BAA-2/BBB 6.750 Nov 15, 2005 1,710,000 1,728,500
---------
Machine Tools: 1.3%
Giddings & Lewis BA-1 7.500 Oct 01, 2005 2,500,000 2,661,433
---------
Oil/Oil Service: 3.7%
Baroid Corp AA-3/A 8.000 Apr 15, 2003 58,000 62,666
Coastal Corp BAA-3/BBB- 10.250 Oct 15, 2004 1,000,000 1,206,694
Enron Corp. BAA-2/BBB+ 7.625 Sep 10, 2004 1,500,000 1,609,884
Enron Corp. BAA-2/BBB+ 6.875 Oct 15, 2007 1,500,000 1,550,553
Lyondell Petrochem BAA-3/BBB- 10.000 Jun 01, 1999 500,000 516,010
Union Oil Co. of California BAA-1/BBB+ 7.200 May 15, 2005 1,400,000 1,480,160
Union Oil Co. of California BAA-1/BBB+ 9.125 Feb 15, 2006 1,000,000 1,177,117
---------
Oil/Oil Service total 7,603,084
---------
Containers: 0.5%
Bemis Co., Inc. A-2/A 6.700 Jul 01, 2005 1,010,000 1,041,149
---------
Chemicals: 1.7%
Union Carbide Corporation BAA-2/BBB 6.790 Jun 01, 2025 3,300,000 3,394,694
---------
Transportation: 6.6%
American Airlines A-3/BBB 8.040 Sep 16, 2011 2,000,000 2,182,690
Burlington Northern, Inc. BAA-2/BBB 7.400 May 15, 1999 200,000 202,350
CSX Corp BAA-2/BBB 9.000 Aug 15, 2006 1,800,000 2,105,591
Delta Air Lines BAA-1/BBB 8.540 Jan 02, 2007 278,816 302,374
Federal Express A-3/BBB+ 7.850 Jan 30, 2015 3,420,130 3,799,850
Golden State Petroleum Transport AA-2/BB+ 8.040 Feb 01, 2019 4,000,000 4,430,528
Southwest Airlines A-1/A 8.700 Jul 01, 2011 19,451 22,631
United Airlines Baa-1/BBB 9.020 Apr 19, 2012 462,541 537,124
---------
Transportation total 13,583,138
---------
Railroad Equipment: 0.2%
Union Pacific RR Aa-3/A 6.540 Jul 01, 2015 434,739 447,214
---------
<PAGE>
BOND FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
BOND FUND INVESTMENTS, % Net Quality Coupon Maturity Par
CONTINUED: Assets Rating* Rate Date Amount Value
------ ------- ---- ---- ------ -----
Utilities-Telephone: 5.6%
BellSouth Telecommunications, Inc. AAA/AAA 6.250 May 15, 2003 $1,500,000 $ 1,523,892
Carolina T&T AA-3/A+ 5.750 Aug 15, 2000 1,000,000 996,651
GTE Corporation BAA-1/A 9.100 Jun 01, 2003 1,000,000 1,125,386
GTE Corporation BAA-1/A 9.375 Dec 01, 2000 500,000 536,349
GTE Hawaiian Telephone BAA-2/A 7.375 Sept 01, 2006 2,000,000 2,132,624
GTE North, Inc. A-1/AA- 6.000 Jan 15, 2004 4,550,000 4,531,377
Northwestern Bell Telephone Co. AA-3/A 9.500 May 01, 2000 600,000 636,822
Pacific NW Bell Telephone AA-3/A 4.375 Sep 01, 2002 35,000 32,942
---------
Utilities-Telephone total 11,516,043
---------
Utilities-Electric: 5.5%
Cincinnati Gas & Electric A-3/A- 5.800 Feb 15, 1999 1,000,000 998,817
Cincinnati Gas & Electric A-3/A- 6.450 Feb 15, 2004 2,000,000 2,034,376
Commonwealth Edison BAA-2/BBB 7.000 Jul 01, 2005 1,000,000 1,040,830
Florida Power A-1 6.720 Jul 01, 2005 2,000,000 2,061,796
Midwest Power Systems A-2/AA- 7.125 Feb 01, 2003 150,000 156,501
Niagara Mohawk Power BA-2/BBB- 9.250 Oct 01, 2001 500,000 539,371
Pacificorp A-2/A 6.750 Apr 01, 2005 250,000 256,979
Wisconsin Power & Light AA-2/AA 7.600 Jul 01, 2005 2,000,000 2,169,070
Wisconsin Public Service, Inc. AA-2/AA+ 7.300 Oct 01, 2002 2,000,000 2,102,262
---------
Utilities-Electric total 11,360,002
---------
Utilities-Natural Gas Pipeline: 2.3%
Burlington Resources, Inc. A-3/A- 9.625 Jun 15, 2000 100,000 106,575
Consolidated Natural Gas A-1/AA- 5.875 Oct 01, 1998 50,000 50,006
El Paso Natural Gas Baa-2/BBB 9.450 Sep 01, 1999 500,000 518,030
Michigan Consolidated Gas A-2/A 5.750 May 01, 2001 1,000,000 994,151
Southwestern Energy BAA-2/BBB+ 6.700 Dec 01, 2005 1,000,000 1,034,537
Transcontinental Gas A-2/BBB 6.125 Jan 15, 2005 2,000,000 1,996,528
---------
Utilities-Natural Gas Pipeline total 4,699,827
---------
Metals/Copper 0.8%
Magma Copper A-2 8.700 May 15, 2005 1,400,000 1,590,548
---------
Pollution Control 1.0%
WMX Technologies BAA-1/BBB 7.000 May 15, 2005 2,000,000 2,067,208
---------
Diversified Companies: 0.1%
Whitman Corporation BAA-2/BBB+ 7.500 Feb 01, 2003 100,000 105,135
-----------
TOTAL U.S. CORPORATE BONDS
(COST: $152,556,010) $154,909,834
-----------
Non - U.S. Corporate Bonds: 5.5%
BHP Finance, Inc. A-2/A 6.420 Mar 01, 2026 $2,000,000 $2,002,962
Falconbridge Ltd. BAA-2/BBB+ 7.350 Nov 01, 2006 2,000,000 2,088,086
Hanson Overseas A-3/A- 6.750 Sep 15, 2005 2,000,000 2,068,664
-----------
TOTAL NON - U.S. CORPORATE BONDS
(COST: $6,154,774) $6,159,712
-----------
TOTAL INVESTMENTS, BOND FUND
(COST: $200,215,863) $201,810,654
===========
See accompanying notes to investments in securities.
<FN>
*Moody's/Standard & Poors' quality ratings (unaudited). See the current
Prospectus and Statement of Additional Information for a complete description of
these ratings.
**At June 30, 1998, the cost of securities for federal income tax purposes was
$200,215,863. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation.............................. $2,771,032
Gross unrealized depreciation.............................. (1,176,241)
---------
Net unrealized depreciation................................ $1,594,791
=========
***This security provides a claim on the interest component of the underlying
mortgages, but not on their principal component. That is, the security's cash
flows depend on the amount of principal outstanding at the payment date. If
prepayments on the underlying mortgages are higher than expected, the yield on
the security may be adversely affected.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MONEY MARKET FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
% Net Quality Annualized Maturity Par
MONEY MARKET FUND INVESTMENTS: Assets Rating* Yield Date Amount Value
------ ------- ----- ---- ------ -----
Short-Term Investments:
<S> <C> <C> <C> <C> <C> <C>
Commercial Paper/Savings: 79.7%
American Express Credit Corp. A-1/P-1 5.64% Aug 18, 1998 $1,786,000 $1,773,317
American General Finance Corp. A-1/P-1 5.62% July 23, 1998 300,000 298,993
American General Finance Corp. A-1/P-1 5.65% July 23, 1998 1,700,000 1,694,276
Ameritech A-1+/P-1 5.90% July 13, 1998 174,000 173,664
Associates Corp NA A-1+/P-1 5.58% July 01, 1998 2,088,000 2,088,000
Bell South Telecom Inc. A-1+/P-1 5.62% Aug 11, 1998 2,100,000 2,089,164
Caterpillar Financial Services A-1/P-1 5.70% Dec 08, 1998 136,000 132,694
Caterpillar Financial Services A-1/P-1 5.65% July 23, 1998 2,000,000 1,993,339
Coca-Cola Co. A-1+/P-1 5.60% Sept 11, 1998 2,135,000 2,111,742
Consolidated Natural Gas A-1+/P-1 5.62% July 10, 1998 1,000,000 998,620
Emerson Electric Company A-1+/P-1 5.68% Nov 30, 1998 2,136,000 2,086,848
Ford Motor Credit Company A-1/P-1 5.64% Aug 03, 1998 2,134,000 2,123,221
General Electric Capital Corporation A-1+/P-1 5.67% Sept 01, 1998 125,000 123,809
General Electric Capital Corporation A-1+/P-1 5.64% July 14, 1998 2,000,000 1,996,028
General Motors Acceptance Corporation A-1/P-1 5.63% Sept 01, 1998 2,125,000 2,112,892
IBM Credit Corporation A-1/P-1 5.63% July 31, 1998 2,085,000 2,075,440
Interstate Power Co. A-1/P-1 5.66% July 17, 1998 1,600,000 1,596,046
John Deere Capital Corporation A-1/P-1 5.65% Sept 01, 1998 1,500,000 1,485,740
Lucent Technologies A-1/P-1 5.71% July 31, 1998 401,000 400,249
McGraw-Hill Companies A-1/P-1 5.65% Sept 23, 1998 2,000,000 1,974,380
MDU Resources Group Inc A-1/P-1 5.94% July 07, 1998 502,000 501,511
Merrill Lynch & Co Inc A-1+/P-1 5.66% July 31, 1998 2,140,000 2,131,218
Walt Disney Company A-1/P-1 5.61% Oct 23, 1998 2,106,000 2,069,854
State Street Bank & Trust 5.00% 1,271 1,271
----------
TOTAL COMMERCIAL PAPER/
SAVINGS AT COST $34,032,316
----------
Quasi-Government/Government Sponsored: 13.4%
Federal Home Loan Discount Notes 5.47% Aug 28, 1998 $3,251,000 $3,245,788
Federal Home Loan Discount Notes 5.49% Aug 20, 1998 1,900,000 1,886,093
Federal Home Loan Discount Notes 5.54% Aug 03, 1998 115,000 114,431
Federal Farm Credit Discount Notes 5.62% Feb 25, 1999 475,000 458,192
----------
TOTAL QUASI-GOVERNMENT/GOVERNMENT
SPONSORED, AT COST $5,704,504
----------
Govenment Guaranteed:
U. S. Treasury Bill 7.0% 5.51% Aug 20, 1998 $3,000,000 $2,978,208
----------
TOTAL INVESTMENTS, MONEY MARKET
FUND AT COST $42,715,028
==========
See accompanying notes to investments in securities.
<FN>
*Moody's/Standard & Poors' quality ratings (unaudited). See the current
Prospectus and Statement of Additional Information for a complete description of
these ratings.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TREASURY 2000 FUND OF ULTRA SERIES FUND
Investments in Securities (Continued)
June 30, 1998
(Unaudited)
% of Interest Maturity Principal
TREASURY 2000 FUND INVESTMENTS: Net Assets Rate Date Amount Value
---------- ---- ---- ------ -----
Government Guaranteed - U.S.:
<S> <C> <C> <C> <C> <C>
U.S. Treasury Strip (Cost $1,558,973)* 100.0% 9.69% Nov 15, 2000 $2,000,000 $1,759,666
=========
See accompanying notes to investments in securities.
<FN>
Notes to investments in securities:
Interest rates on and stripped Treasury Securities represent annualized yield to
maturity at date of purchase. Values of investment securities are determined as
described in Note 2 of the financial statements.
*At June 30, 1998, the cost of securities for federal income tax purposes was
$1,558,973. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation................................... $200,693
Gross unrealized depreciation................................... --
--------
Net unrealized appreciation..................................... $200,693
========
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ULTRA SERIES FUND
Statement of Operations
Six Months Ended June 30, 1998
(Unaudited)
Capital Growth and Money Treasury
Appreciation Income Stock Balanced Bond Market 2000
Stock Fund Fund Fund Fund Fund Fund
Investment income (note 2):
<S> <C> <C> <C> <C> <C> <C>
Interest income $610,218 $819,411 $6,114,378 $6,564,872 $1,157,166 $56,649
Dividend income 2,342,654 5,189,702 1,088,117 -- -- --
---------- ---------- ---------- --------- --------- --------
Total income 2,952,872 6,009,113 7,202,495 6,564,872 1,157,166 56,649
---------- ---------- ---------- --------- --------- --------
Expenses (note 4):
Management fees 2,056,006 2,026,976 1,214,013 536,895 94,413 3,859
Trustees' fees 1,481 3,658 1,987 498 300 --
Audit fees 3,116 6,268 3,343 1,081 471 --
---------- ---------- ---------- --------- --------- --------
Total net expenses 2,060,603 2,036,902 1,219,343 538,474 95,184 3,859
---------- ---------- ---------- --------- --------- --------
Net investment income 892,269 3,972,211 5,983,152 6,026,398 1,061,982 52,790
Realized and unrealized gain (loss)
on investments (notes 2 and 3):
Realized gain (loss) on security
transactions:
Proceeds from sale of securities
and principal pay downs
(notes 2 and 3): 192,336,231 183,211,095 194,907,817 127,044,535 136,473,266 --
Cost of securities sold (191,456,880) (180,966,218) (196,227,283) (127,726,842) (136,473,266) --
---------- ---------- ---------- --------- --------- --------
Net realized gain (loss) on
security transactions 879,351 2,244,877 (1,319,466) (682,307) -- --
---------- ---------- ---------- --------- --------- --------
Net change in unrealized
appreciation or depreciation
on investments 62,919,136 68,332,882 20,056,052 1,173,121 -- 1,643
---------- ---------- ---------- --------- --------- --------
Net gain (loss) on investments 63,798,487 70,577,759 18,736,586 490,814 -- 1,643
---------- ---------- ---------- --------- --------- --------
Net increase in net assets
resulting from operations $64,690,756 $74,549,970 $24,719,738 $6,517,212 $1,061,982 $54,433
========== ========== ========== ========= ========= ========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ULTRA SERIES FUND
Statement of Changes in Net Assets
Six Months Ended June 30, 1998 and the Year Ended December 31, 1997
(Unaudited)
CAPITAL APPRECIATION GROWTH AND INCOME
STOCK FUND STOCK FUND BALANCED FUND
Operations: 1998 1997 1998 1997 1998 1997
<S> <C> <C> <C> <C> <C> <C>
Net investment income $892,269 $1,059,234 $3,972,211 $5,120,623 $5,983,152 $9,624,016
Net realized gain (loss) on security
transaction 879,351 5,517,238 2,244,877 9,499,009 (1,319,466) 3,792,615
Net change in unrealized appreciation
or depreciation on investments 62,919,136 40,907,564 68,332,882 84,642,706 20,056,052 25,504,114
----------- ----------- ----------- ----------- ----------- -----------
Change in net assets from
operations 64,690,756 47,484,036 74,549,970 99,262,338 24,719,738 38,920,745
----------- ----------- ----------- ----------- ----------- -----------
Distributions to shareholders:
From net investment income (570,765) (1,065,876) (1,973,026) (5,180,495) (2,929,949) (9,668,911)
From realized gains on investments -- (5,541,711) (3,132) (9,518,672) (19,797) (3,841,952)
Return of capital -- (43,461) -- (118,470) -- --
----------- ----------- ----------- ----------- ----------- -----------
Change in net assets from
distributions (570,765) (6,651,048) (1,976,158) (14,817,637) (2,949,746) (13,510,863)
----------- ----------- ----------- ----------- ----------- -----------
Class Z Share transactions (note 5):
Proceeds from sale of shares 43,292,274 311,778,406 82,691,068 260,073,329 56,130,224 80,187,804
Net asset value of shares issued in
reinvestment of distributions 570,765 6,651,048 1,976,158 14,817,637 2,949,746 13,510,863
----------- ----------- ----------- ----------- ----------- -----------
43,863,039 318,429,454 84,667,226 274,890,966 59,079,970 93,698,667
Cost of shares repurchased (381,664) (1,742,040) (3,752,986) (2,041,007) (2,307,948) (4,029,711)
----------- ----------- ----------- ----------- ----------- -----------
Change in net assets derived from
capital share transactions 43,481,375 316,687,414 80,914,240 272,849,959 56,772,022 89,668,956
----------- ----------- ----------- ----------- ----------- -----------
Increase in net assets 107,601,366 357,520,402 153,488,052 357,294,660 78,542,014 115,078,838
Net assets:
Beginning of year 456,194,235 98,673,833 590,135,433 232,840,773 309,803,712 194,724,874
----------- ----------- ----------- ----------- ----------- -----------
End of year $563,795,601 $456,194,235 $743,623,485 $590,135,433 $388,345,726 $309,803,712
=========== =========== =========== =========== =========== ===========
Undistributed net investment
income included in net assets $329,115 -- $2,008,872 -- $3,103,189 $ 49,986
=========== =========== =========== =========== =========== ===========
See accompanying notes to financial statements.
<PAGE>
ULTRA SERIES FUND
Statement of Changes in Net Assets (Continued)
Six Months Ended June 30, 1998 and the Year Ended December 31, 1997
(Unaudited)
BOND FUND MONEY MARKET FUND TREASURY 2000 FUND
Operations: 1998 1997 1998 1997 1998 1997
Net investment income $6,026,398 $3,058,282 $1,061,982 $1,475,243 $52,790 $106,851
Net realized gain (loss) on security
transactions (682,307) 22,394 -- -- -- --
Net change in unrealized appreciation
or depreciation on investments 1,173,121 326,623 -- -- 1,643 1,846
---------- ----------- ---------- ---------- ---------- ----------
Change in net assets from
operations 6,517,212 3,407,299 1,061,982 1,475,243 54,433 108,697
----------- ----------- ---------- ---------- ---------- ----------
Distributions to shareholders:
From net investment income (3,031,622) (3,013,977) (1,061,982) (1,475,243) -- --
From realized gains on investments -- (22,394) -- -- -- --
Return of capital -- -- -- -- -- --
----------- ----------- ---------- ---------- ---------- ----------
Change in net assets from
distributions (3,031,622) (3,036,371) (1,061,982) (1,475,243) -- --
----------- ----------- ---------- ---------- ---------- ----------
Class Z Share transactions (note 5):
Proceeds from sale of shares 11,428,348 160,361,652 19,296,201 57,328,276 -- 7,239
Net asset value of shares issued in
reinvestment of distributions 3,031,622 3,036,371 1061,693 1,473,088 -- --
----------- ----------- ---------- ---------- ---------- ----------
14,459,970 163,398,023 20,357,894 58,801,364 -- 7,239
Cost of shares repurchased (1,671,418) (1,501,306) (18,834,842) (38,642,199) -- --
----------- ----------- ---------- ---------- ---------- ----------
Change in net assets derived from
capital share transactions 12,788,552 161,896,717 1,523,052 20,159,165 -- 7,239
----------- ----------- ---------- ---------- ---------- ----------
Increase (decrease) in net assets 16,274,142 162,267,645 1,523,052 20,159,165 54,433 115,936
Net assets:
Beginning of year 188,839,568 26,571,923 41,170,152 21,010,987 1,700,677 1,584,741
----------- ----------- ---------- ---------- ---------- ----------
End of year $205,113,710 $188,839,568 $42,693,204 $41,170,152 $1,755,110 $1,700,677
=========== =========== ========== ========== ========== ==========
Undistributed net investment
income included in net assets $3,057,115 $62,339 -- -- -- --
=========== =========== ========== ========== ========== ==========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CAPITAL APPRECIATION STOCK FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
----------------------- CAPITAL APPRECIATION STOCK FUND ----------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $18.85 $14.60 $12.51 $9.97 $10.00
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income .04 0.07 0.13 0.14 0.16
Net Realized and Unrealized Gain (Loss)
on Investments 2.55 4.52 2.55 2.91 0.37
------ ------ ------ ------ ------
Total from Investment Operations 2.59 4.59 2.68 3.05 0.53
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income .02 (0.07) (0.13) (0.14) (0.15)
Distributions from Realized Capital Gains .00 (0.27) (0.46) (0.37) (0.41)
------ ------ ------ ------ ------
Total Distributions (.02) (0.34) (0.59) (0.51) (0.56)
------------------------------------------------------------------------------------
Net Asset Value, End of Period $21.42 $18.85 $14.60 $12.51 $9.97
====================================================================================================================================
Total Return* 13.75% 31.57% 21.44% 30.75% 5.44%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $563,796 $456,194 $98,674 $38,117 $9,449
Ratio of Expenses to Average Net Assets** 0.79% 0.82% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average
Net Assets 0.34% 0.70% 0.96% 1.37% 1.55%
Portfolio Turnover Rate 3.21% 17.06% 49.77% 61.32% 65.81%
Average Commission Rate $0.06 $0.06 $0.06 $0.06
====================================================================================================================================
<FN>
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
** During the periods shown, prior to May 1, 1997, CUNA Mutual Life Insurance
Company and its affiliates absorbed certain expenses under the terms of an
Expense Reimbursement Agreement between the Ultra Series Fund and CUNA Mutual
Life Insurance Company. If the Expense Reimbursement Agreement had not been
in effect and if the full expenses allowable under the Investment Advisory
Agreement between the Ultra Series Fund and the Investment Adviser had been
charged, the resulting ratio of expenses to average net assets would have
been 0.83%, 0.66%, 0.75%, and 0.85% for 1997, 1996, 1995, and 1994,
respectively.
</FN>
<PAGE>
GROWTH AND INCOME STOCK FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
-------------------------- GROWTH AND INCOME STOCK FUND ----------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $27.20 $21.32 $18.20 $15.06 $15.51
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income .17 0.31 0.34 0.37 0.32
Net Realized and Unrealized Gain (Loss)
on Investments 3.16 6.36 3.93 4.37 (0.04)
------ ------ ------ ------ ------
Total from Investment Operations 3.33 6.67 4.27 4.74 0.28
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income (0.08) (0.32) (0.34) (0.37) (0.32)
Distributions from Realized Capital Gains .00 (0.47) (0.81) (1.23) (0.40)
------ ------ ------ ------ ------
Total Distributions (0.08) (0.79) (1.15) (1.60) (0.73)
------------------------------------------------------------------------------------
Net Asset Value, End of Period $30.45 $27.20 $21.32 $18.20 $15.06
====================================================================================================================================
Total Return* 12.23% 31.42% 22.02% 31.75% 1.42%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $743,623 $590,135 $232,841 $102,138 $48,913
Ratio of Expenses to Average Net Assets** 0.60% 0.61% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average
Net Assets 1.17% 1.39% 1.78% 2.28% 2.19%
Portfolio Turnover Rate 2.51% 20.39% 40.55% 57.80% 45.36%
Average Commission Rate $0.06 $0.06 $0.06 $0.06
====================================================================================================================================
<FN>
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
** During the periods shown, prior to May 1, 1997, CUNA Mutual Life Insurance
Company and its affiliates absorbed certain expenses under the terms of an
Expense Reimbursement Agreement between the Ultra Series Fund and CUNA Mutual
Life Insurance Company. If the Expense Reimbursement Agreement had not been
in effect and if the full expenses allowable under the Investment Advisory
Agreement between the Ultra Series Fund and the Investment Adviser had been
charged, the resulting ratio of expenses to average net assets would have
been 0.61%, 0.65%, 0.69%, and 0.70% for 1997, 1996, 1995, and 1994,
respectively.
</FN>
<PAGE>
BALANCED FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
--------------------------------- BALANCED FUND ------------------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $17.02 $15.29 $14.63 $12.90 $13.70
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income 0.29 0.62 0.58 0.55 0.52
Net Realized and Unrealized Gain (Loss)
on Investments 1.00 1.93 0.98 2.29 (0.56)
------ ------ ------ ------ ------
Total from Investment Operations 1.29 2.55 1.56 2.84 (0.04)
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income (0.15) (0.63) (0.58) (0.55) (0.51)
Distributions from Realized Capital Gains 0.01 (0.19) (0.32) (0.56) (0.25)
------ ------ ------ ------ ------
Total Distributions (0.14) (0.82) (0.90) (1.11) (0.76)
------------------------------------------------------------------------------------
Net Asset Value, End of Period $18.17 $17.02 $15.29 $14.63 $12.90
====================================================================================================================================
Total Return* 7.59% 16.87% 10.79% 22.27% -0.46%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $388,346 $309,804 $194,725 $110,969 $67,468
Ratio of Expenses to Average Net Assets** 0.70% 0.68% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average
Net Assets 3.42% 3.81% 3.91% 4.03% 4.00%
Portfolio Turnover Rate 18.56% 21.15% 33.48% 36.68% 28.53%
Average Commission Rate $0.06 $0.06 $0.06 $0.06
====================================================================================================================================
<FN>
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
** During the periods shown, prior to May 1, 1997, CUNA Mutual Life Insurance
Company and its affiliates absorbed certain expenses under the terms of an
Expense Reimbursement Agreement between the Ultra Series Fund and CUNA Mutual
Life Insurance Company. If the Expense Reimbursement Agreement had not been
in effect and if the full expenses allowable under the Investment Advisory
Agreement between the Ultra Series Fund and the Investment Adviser had been
charged, the resulting ratio of expenses to average net assets would have
been 0.69%, 0.65%, 0.68%, and 0.70% for 1997, 1996, 1995, and 1994,
respectively.
</FN>
<PAGE>
BOND FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
----------------------------------- BOND FUND --------------------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.54 $10.33 $10.63 $9.67 $10.58
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income 0.33 0.29 0.65 0.60 0.59
Net Realized and Unrealized Gain (Loss)
on Investments 0.03 0.45 (0.28) 0.96 (0.90)
------ ------ ------ ------ ------
Total from Investment Operations 0.36 0.74 0.37 1.56 (0.31)
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income (0.16) (0.51) (0.64) (0.59) (0.59)
Distributions from Realized Capital Gains 0.00 (0.02) (0.03) (0.01) (0.01)
------ ------ ------ ------ ------
Total Distributions (0.16) (0.53) (0.67) (0.60) (0.60)
------------------------------------------------------------------------------------
Net Asset Value, End of Period $10.74 $10.54 $10.33 $10.63 $9.67
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return* 3.36% 7.45% 2.86% 16.37% -3.06%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $205,114 $188,840 $26,572 $13,725 $7,867
Ratio of Expenses to Average Net Assets** 0.55% 0.56% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average
Net Assets 6.12% 6.50% 6.25% 6.08% 6.03%
Portfolio Turnover Rate 33.99% 30.71% 25.67% 14.74% 11.97%
====================================================================================================================================
<FN>
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
** During the periods shown, prior to May 1, 1997, CUNA Mutual Life Insurance
Company and its affiliates absorbed certain expenses under the terms of an
Expense Reimbursement Agreement between the Ultra Series Fund and CUNA Mutual
Life Insurance Company. If the Expense Reimbursement Agreement had not been
in effect and if the full expenses allowable under the Investment Advisory
Agreement between the Ultra Series Fund and the Investment Adviser had been
charged, the resulting ratio of expenses to average net assets would have
been 0.57%, 0.67%, 0.68%, and 0.70% for 1997, 1996, 1995, and 1994,
respectively.
</FN>
<PAGE>
MONEY MARKET FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
------------------------------ MONEY MARKET FUND -----------------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income 0.03 0.05 0.05 0.05 0.03
Net Realized and Unrealized Gain (Loss)
on Investments 0.00 0.00 0.00 0.00 0.00
------ ------ ------ ------ ------
Total from Investment Operations 0.03 0.05 0.05 0.05 0.03
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income (0.03) (0.05) (0.05) (0.05) (0.03)
Distributions from Realized Capital Gains 0.00 (0.00) (0.00) (0.00) 0.00
------ ------ ------ ------ ------
Total Distributions (0.03) (0.05) (0.05) (0.05) (0.03)
------------------------------------------------------------------------------------
Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00
====================================================================================================================================
Total Return* 2.53% 4.75% 5.17% 5.21% 3.34%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $42,693 $41,170 $21,011 $11,374 $7,799
Ratio of Expenses to Average Net Assets** 0.45% 0.50% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average
Net Assets 5.01% 5.05% 4.74% 5.17% 3.66%
Portfolio Turnover Rate -- -- -- -- --
====================================================================================================================================
<FN>
For the Money Market Fund, the "seven-day average" yield for the seven days
ended June 30, 1998, was 5.09% and the "effective" yield for that period was
5.22%.
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
** During the periods shown, prior to May 1, 1997, CUNA Mutual Life Insurance
Company and its affiliates absorbed certain expenses under the terms of an
Expense Reimbursement Agreement between the Ultra Series Fund and CUNA Mutual
Life Insurance Company. If the Expense Reimbursement Agreement had not been
in effect and if the full expenses allowable under the Investment Advisory
Agreement between the Ultra Series Fund and the Investment Adviser had been
charged, the resulting ratio of expenses to average net assets would have
been 0.51%, 0.67%, 0.73%, and 0.78% for 1997, 1996, 1995, and 1994,
respectively.
</FN>
<PAGE>
TREASURY 2000 FUND OF ULTRA SERIES FUND
Financial Highlights
Six Months Ended June 30, 1998 and the Year Ended December 31
(Unaudited)
------------------------------ TREASURY 2000 FUND ----------------------------------
(For a share outstanding throughout the period): 1998 1997 1996 1995 1994
------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $9.24 $8.64 $8.47 $7.00 $7.53
------ ------ ------ ------ ------
Income from Investment Operations
Net Investment Income 0.00 0.58 0.58 0.58 0.53
Net Realized and Unrealized Gain (Loss)
on Investments 0.29 0.02 (0.41) 0.89 (1.06)
------ ------ ------ ------ ------
Total from Investment Operations 0.29 0.60 0.17 1.47 (0.53)
------------------------------------------------------------------------------------
Distributions
Distributions from Net Investment Income 0.00 0.00 0.00 0.00 0.00
Distributions from Realized Capital Gains 0.00 0.00 0.00 0.00 0.00
------ ------ ------ ------ ------
Total Distributions 0.00 0.00 0.00 0.00 0.00
------------------------------------------------------------------------------------
Net Asset Value, End of Period $9.53 $9.24 $8.64 $8.47 $7.00
====================================================================================================================================
Total Return* 3.19% 6.85% 2.10% 20.99% -7.12%
====================================================================================================================================
Ratio/Supplemental Data
Net Assets, End of Period (000s Omitted) $1,755 $1,701 $1,585 $1,545 $1,272
Ratio of Expenses to Average Net Assets 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of Net Investment Income to Average
Net Assets 6.10% 6.56% 7.03% 7.40% 7.50%
Portfolio Turnover Rate -- -- -- -- --
====================================================================================================================================
<FN>
*These returns are after all charges at the mutual fund level have been
subtracted. These returns are higher than the returns at the separate account
level because charges made at the separate account level have not been
subtracted.
</FN>
</TABLE>
<PAGE>
ULTRA SERIES FUND
Notes to Financial Statements
(1) Description of the Fund
The Ultra Series Fund (the "Fund"), a Massachusetts Business Trust, is
registered under the Investment Company Act of 1940 (the "1940 Act"), as
amended, as a diversified, open-end management investment company. The Fund
is a series fund with six investment portfolios (the "funds"), each with
different investment objectives and policies and each having available two
separate classes of common stock with a par value of $.01 per share. Fund
shares are sold and redeemed at a price equal to the shares' net asset
value (note 2(b)). The assets of each fund are held separate from the
assets of the other funds.
Effective May 1, 1997, the shares of each fund were divided into Class Z
and Class C Shares. Class Z Shares are offered to all insurance company
separate accounts issued by, and all qualified retirement plans sponsored
by, CUNA Mutual Life Insurance Company or its affiliates ("CUNA Mutual
Life"). Class C Shares are offered to separate accounts of insurance
companies other than CUNA Mutual Life, and to qualified retirement plans of
companies not affiliated with the Fund or CUNA Mutual Life. Both classes of
shares are identical in all respects except that: Class C Shares may be
subject to a distribution fee (note 4); each class will have exclusive
voting rights with respect to matters that affect just that class; and each
class will bear a different name or designation. All income earned and
expenses incurred by the Fund are borne on a pro-rata basis by each
outstanding share of each class based on the daily net asset value of
shares of that class. As of June 30, 1998, no Class C Shares have been
issued.
(2) Significant Accounting Policies
(a) Valuation of Investment Securities
Value of securities, including call options, which are traded on
exchanges are valued at the last sales price on the principal exchange
as of the close of the New York Stock Exchange or 3:00 p.m. Central
Standard Time, whichever is earlier, on the day the securities are
being valued. Securities not traded on a stock exchange on a given day
or traded over-the-counter are valued using a procedure determined in
good faith to represent a fair value and which is authorized by the
Board of Trustees. Pursuant to Rule 2A-7 of the 1940 Act, all money
market instruments in the Money Market Fund are valued on an amortized
cost basis. Money Market Instruments in the other funds are valued on
an amortized cost basis if there are less than 60 days to maturity.
(b) Share Valuation and Dividends to Shareholders
The net asset value of the shares of each fund is determined on a daily
basis based on the valuation of the net assets of the funds divided by
the number of shares of the fund outstanding. Expenses, including the
investment advisory, advisory/administrative, and distribution fees
(note 4), are accrued daily and reduce the net asset value per share.
Dividends on the Money Market Fund will be declared and reinvested
daily in additional full and fractional shares of the Money Market
Fund. Dividends of ordinary income from the Capital Appreciation Stock
Fund, Growth and Income Stock Fund, Bond Fund, and Balanced Fund will
be declared and reinvested quarterly in additional full and fractional
shares of the respective funds. All net realized capital gains of these
funds, if any, will be declared and reinvested at least annually. The
Treasury 2000 Fund will utilize an annual consent dividend procedure
which provides the fund with the deduction for dividends constructively
paid to shareholders.
(c) Federal Income and Excise Taxes
The Fund intends to distribute all of its taxable income and to comply
with the other requirements of the Internal Revenue Code applicable to
regulated investment companies. Accordingly, no provision for income or
excise taxes is required. Net investment income and net realized gains
(losses) for the funds may differ for financial statement and tax
purposes. The character of distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains
(losses) were recorded by the funds.
<PAGE>
(d) Security Transactions and Investment Income
Security transactions are recorded on the trade date basis. Realized
gains and losses from security transactions are reported on the
identified cost basis. Interest, including amortization of premium and
discount, is accrued daily and dividend income is recorded on the
ex-dividend date.
(e) 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.
(3) Purchase and Sales of Investment Securities
<TABLE>
<CAPTION>
The cost of securities purchased and the proceeds from securities sold
(including maturities, excluding short-term securities for all funds except
Money Market) for each fund during the six-month period ended June 30,
1998, were as follows:
Capital Growth and Money Treasury
Appreciation Income Stock Balanced Bond Market 2000
Stock Fund Fund Fund Fund Fund Fund
------------ ------------ -------- ---- ------ --------
<S> <C> <C> <C> <C> <C> <C>
Total costs of securities purchased $63,719,284 $107,157,165 $123,344,644 $91,662,933 $136,914,740 $ --
========== =========== =========== ========== =========== ========
Total proceeds received on security
sales and principal paydowns $192,336,231 $183,211,095 $194,907,817 $127,044,535 $136,473,266 $ --
=========== =========== =========== ========== =========== ========
</TABLE>
(4) Transactions with Affiliates
Fees and Expenses
The Fund has entered into an investment advisory agreement with CIMCO Inc.
(the "Investment Adviser"), an affiliated company. For the four-month
period ended April 30, 1997, the Investment Adviser received monthly
advisory or advisory/ administrative fees, based on average daily net
assets, at an annual rate of .5 percent of the Capital Appreciation Stock,
Growth and Income Stock, Balanced, Bond and Money Market Funds and .45
percent of the Treasury 2000 Fund. On May 1, 1997, a new advisory agreement
with the Investment Advisor changed this fee structure and provides for a
different fee for each portfolio within the Fund. The fees, paid monthly,
are calculated as a percentage of the average daily net assets for each
portfolio at the following annual rates:
Capital Appreciation Stock 0.80%
Balanced 0.70%
Growth and Income Stock 0.60%
Bond 0.55%
Money Market 0.45%
Treasury 2000 0.45%
Under the new unitary fee structure, the Investment Adviser is responsible
for providing or obtaining services and paying certain expenses including
custodian fees, transfer agent fees, pricing costs, and accounting and
legal fees as indicated in the investment advisory agreement.
In addition to the unitary investment advisor fee, each fund also pays
certain expenses including trustees fees, brokerage commis-sions, interest
expense, audit fees, and other extraordinary expenses.
For the four-month period ended April 30, 1997, the Investment Adviser was
required to reimburse the funds for the amount, if any, by which the
aggregate expenses of any fund (including the Investment Adviser's fee, but
excluding brokerage commissions, interest, taxes, and extraordinary
expenses) in any calendar year exceed 2.0 percent of the average daily net
assets of the funds. In addition, for the four-month period ended April 30,
1997, CUNA Mutual Life has voluntarily agreed to reimburse the Capital
Appreciation Stock, Growth and Income Stock, Balance, Bond and Money Market
Funds for ordinary business expenses in excess of .65 percent (of which .5
percent is the advisory fee and .15 percent is general and administrative
expenses) of the average daily net assets of these funds. Also, for the
four-month period ended April 30, 1997, the Investment Advisor has agreed
to assume responsibility for providing all administrative services and
paying all ordinary business expenses of the Treasury 2000 Fund which
exceed .45 percent (all of which is the advisory/administrative fee) of
average daily net assets. Currently, CUNA Mutual Life and CUNA Mutual
Insurance Society, affiliated companies, are providing administrative
services on behalf of the Investment Advisor.
<PAGE>
All capital shares outstanding at June 30, 1998, are owned by separate
investment accounts of CUNA Mutual Life.
Certain officers and directors of the Fund are also officers of CUNA Mutual
Life or CIMCO Inc. During the six-month period ended June 30, 1998, the
Fund made no direct payments to its officers and paid trustees' fees of
approximately $7,924 to its unaffiliated trustees.
Distribution Plan
All shares are distributed through CUNA Brokerage Service, Inc.("CBS"), and
affiliated company, or other registered broker-dealers authorized by CBS.
Class C Shares may also be subject to an asset-based distribution fee
pursuant to Rule 12b-1 under the 1940 Act, equal to not more than 0.25%, on
an annual basis, of the average value of the daily net assets of each
series of the Fund attributable to Class C Shares on an annual basis.
(5) Share Activity
<TABLE>
<CAPTION>
Transactions in Class Z Shares of each fund for the year ended December 31, 1997 and for the six-month period ended June 30,
1998, were as follows:
Capital Growth and Money Treasury
Appreciation Income Stock Balanced Bond Market 2000
Stock Fund Fund Fund Fund Fund Fund
------------ ------------ -------- ---- ------ --------
<S> <C> <C> <C> <C> <C> <C>
Shares outstanding at December 31, 1996 6,759,264 10,919,647 12,737,422 2,573,070 21,010,987 183,351
Shares sold, including reinvestment
of dividends 17,535,010 10,850,472 5,705,061 15,479,381 58,801,364 787
Shares repurchased (93,915) (77,316) (243,133) (143,139) (38,642,199) --
--------- --------- --------- --------- ---------- -------
Shares outstanding at December 31, 1997 24,200,359 21,692,803 18,199,350 17,909,312 41,170,152 184,138
Shares sold, including reinvestment
of dividends 2,137,755 2,861,358 3,302,102 1,353,189 20,357,894 --
Shares repurchased (17,794) (131,583) (131,416) (156,370) (18,834,842) --
--------- --------- --------- --------- ---------- -------
Shares outstanding at June 30, 1998 26,320,320 24,422,578 21,370,036 19,106,131 42,693,204 184,138
--------- --------- --------- --------- ---------- -------
</TABLE>
<PAGE>
ULTRA SERIES FUND
Officers and Trustees
OFFICERS
Michael S. Daubs, President
Lawrence R. Halverson, Vice President/Secretary
Michael G. Joneson, Chief Accounting Officer, Treasurer and Assistant Secretary
Robert M. Buckingham, Chief Financial Officer/Assistant Secretary
BOARD OF TRUSTEES
Gwendolyn M. Boeke
Michael S. Daubs
Alfred L. Disrud
Lawrence R. Halverson
Keith S. Noah
Thomas C. Watt
