<PAGE>
--------------------------------
SUN LIFE (N.Y.) VARIABLE
ACCOUNT A
ANNUAL REPORT FOR THE
YEAR ENDED DECEMBER 31, 1999
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Participants in Sun Life (N.Y.) Variable Account A and the Board of
Directors of Sun Life Insurance and Annuity Company of New York:
We have audited the accompanying statement of condition of Massachusetts
Investors Trust Sub-Account, Massachusetts Investors Growth Fund Sub-Account,
MFS Total Return Sub-Account, MFS Growth Opportunities Sub-Account, MFS
Research Sub-Account, MFS Bond Sub-Account, MFS Money Market Sub-Account, MFS
Government Money Market Sub-Account, MFS High Income Sub-Account, MFS Global
Governments Sub-Account, and MFS Emerging Growth Sub-Account of Sun Life of
Canada (N.Y.) Variable Account A (the "Sub-Accounts") as of December 31,
1999, the related statement of operations for the year then ended, and the
statements of changes in net assets for the years ended December 31, 1999 and
1998. These financial statements are the responsibility of management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities held as of December 31,
1999 by correspondence with the custodian. An audit also includes assessing
the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of the Sub-Accounts as of December 31, 1999,
the results of its operations and the changes in its net assets for the
respective stated periods in conformity with generally accepted accounting
principles.
Deloitte & Touche LLP
Boston, Massachusetts
February 10, 2000
2
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT A
STATEMENT OF CONDITION
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES COST VALUE
---------------------------------------------
<S> <C> <C> <C>
ASSETS:
Investments in mutual funds:
Massachusetts Investors Trust ("MIT")* 65,030 $1,051,411 $1,362,427
Massachusetts Investors Growth Stock Fund ("MIG")* 55,322 838,495 1,124,864
MFS Total Return Fund ("MTR")* 138,280 2,107,623 1,919,204
MFS Growth Opportunities Fund ("MGO")* 12,012 182,370 229,109
MFS Research Fund ("MFR")* 13,378 286,137 386,066
MFS Bond Fund ("MFB")* 42,462 556,802 517,204
MFS Money Market Fund ("MCM")* 312,499 312,499 312,499
MFS Government Money Market Fund ("MCG")* 30,075 30,075 30,075
MFS High Income Fund ("MFH")* 38,216 198,733 190,589
MFS Global Governments Fund ("MGG")* 12,047 130,848 113,391
MFS Emerging Growth Fund ("MEG")* 14,953 481,900 995,693
-------------------------------
NET ASSETS $6,176,893 $7,181,121
===============================
</TABLE>
<TABLE>
<CAPTION>
NET ASSETS APPLICABLE TO OWNERS OF DEFERRED UNITS UNIT VALUE VALUE
VARIABLE ANNUITY CONTRACTS: ---------------------------------------------
<S> <C> <C> <C>
MIT 19,051 $ 71.5754 $1,362,427
MIG 11,126 101.6219 1,124,864
MTR 42,572 46.5944 1,919,204
MGO 3,458 65.6784 229,109
MFR 5,909 65.3200 386,066
MFB 19,507 25.9887 517,204
MCM 18,016 17.3427 312,499
MCG 1,772 16.9721 30,075
MFH 6,600 29.3372 190,589
MGG 3,806 28.9030 113,391
MEG 9,211 109.1210 995,693
-------------
NET ASSETS $7,181,121
==============
</TABLE>
* Investments are made in Class A shares of the Fund.
See notes to financial statements.
-3-
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT A
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
MIT MIG MTR MGO MFR MFB
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Income and expenses:
Dividend income and capital gain
distributions received $ 45,832 $ 84,410 $ 196,716 $ 26,623 $ 27,673 $ 37,036
Mortality and expense risk charges (19,002) (16,210) (28,447) (4,040) (5,926) (6,980)
--------- --------- --------- --------- --------- ---------
Net investment income (loss) 26,830 68,200 168,269 22,583 21,747 30,056
--------- --------- --------- --------- --------- ---------
Realized and unrealized gains
(losses):
Realized gains (losses) on
investment transactions:
Proceeds from sales 444,580 652,691 449,605 201,961 242,962 90,250
Cost of investments sold (242,931) (387,720) (394,819) (149,708) (145,063) (90,775)
--------- --------- --------- --------- --------- ---------
Net realized gains (losses) 201,649 264,971 54,786 52,253 97,899 (525)
--------- --------- --------- --------- --------- ---------
Net unrealized appreciation
(depreciation) on investments:
End of year 311,016 286,369 (188,419) 46,739 99,929 (39,598)
Beginning of year 465,059 271,399 9,139 62,543 139,939 8,313
--------- --------- --------- --------- --------- ---------
Change in unrealized
appreciation (depreciation) (154,043) 14,970 (197,558) (15,804) (40,010) (47,911)
--------- --------- --------- --------- --------- ---------
Realized and unrealized gains
(losses) 47,606 279,941 (142,772) 36,449 57,889 (48,436)
--------- --------- --------- --------- --------- ---------
Increase (Decrease) in net assets
from operations $ 74,436 $ 348,141 $ 25,497 $ 59,032 $ 79,636 $ (18,380)
========= ========= ========= ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
MCM MCG MFH MGG MEG
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Income and expenses:
Dividend income and capital gain
distributions received $ 13,520 $ 1,245 $ 21,437 $ 10,794 $ 4,789
Mortality and expense risk charges (3,799) (374) (3,017) (2,099) (12,460)
--------- --------- --------- --------- ---------
Net investment income (loss) 9,721 871 18,420 8,695 (7,671)
--------- --------- --------- --------- ---------
Realized and unrealized gains
(losses):
Realized gains (losses) on
investment transactions:
Proceeds from sales 246,495 2,556 94,437 77,483 496,176
Cost of investments sold (246,495) (2,556) (90,872) (85,483) (212,171)
--------- --------- --------- --------- ---------
Net realized gains (losses) -- -- 3,565 (8,000) 284,005
--------- --------- --------- --------- ---------
Net unrealized appreciation
(depreciation) on investments:
End of year -- -- (8,144) (17,457) 513,793
Beginning of year -- -- (456) (8,819) 436,161
--------- --------- --------- --------- ---------
Change in unrealized
appreciation (depreciation) -- -- (7,688) (8,638) 77,632
--------- --------- --------- --------- ---------
Realized and unrealized gains
(losses) -- -- (4,123) (16,638) 361,637
--------- --------- --------- --------- ---------
Increase (Decrease) in net assets
from operations $ 9,721 $ 871 $ 14,297 $ (7,943) $ 353,966
========= ========= ========= ========= =========
</TABLE>
See notes to financial statements.
-4-
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT A
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
MIT MIG MTR
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income $ 26,830 $ 71,748 $ 68,200 $ 82,665 $ 168,269 $ 339,350
Net realized gains (losses) 201,649 75,505 264,971 24,916 54,786 320,975
Net unrealized gains (losses) (154,043) 131,349 14,970 184,814 (197,558) (396,689)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets from
operations 74,436 278,602 348,141 292,395 25,497 263,636
---------- ---------- ---------- ---------- ---------- ----------
Contract Owner Transactions:
Accumulation Activity:
Purchase payments received 31,674 66,096 13,888 22,531 11,466 28,124
Net transfers between Sub-Accounts
and Fixed Accounts (53,038) 58,862 73,789 263,215 (91,840) (8,578)
Withdrawals, surrenders and account fees (310,146) (135,666) (518,546) (66,695) (316,540) (756,937)
---------- ---------- ---------- ---------- ---------- ----------
Net contract owner activity (331,510) (10,708) (430,869) (219,051) (396,914) (737,391)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets (257,074) 267,894 (82,728) 511,446 (371,417) (473,755)
Net Assets:
Beginning of year 1,619,501 1,351,607 1,207,592 696,146 2,290,621 2,764,376
---------- ---------- ---------- ---------- ---------- ----------
End of year $1,362,427 $1,619,501 $1,124,864 $1,207,592 $1,919,204 $2,290,621
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
MGO MFR MFB
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income $ 22,583 $ 32,663 $ 21,747 $ 13,193 $ 30,056 $ 34,726
Net realized gains (losses) 52,253 10,930 97,899 25,727 (525) 9,946
Net unrealized gains (losses) (15,804) 27,444 (40,010) 54,551 (47,911) (23,317)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets from
operations 59,032 71,037 79,636 93,471 (18,380) 21,355
---------- ---------- ---------- ---------- ---------- ----------
Contract Owner Transactions:
Accumulation Activity:
Purchase payments received 4,625 4,092 8,668 17,561 17,484 47,843
Net transfers between Sub-Accounts
and Fixed Accounts 18,954 37,874 (60,889) 36,184 (16,575) (125,568)
Withdrawals, surrenders and account fees (198,135) (28,036) (174,779) (51,835) (49,486) (42,901)
---------- ---------- ---------- ---------- ---------- ----------
Net contract owner activity (174,556) 13,930 (227,000) 1,910 (48,577) (120,626)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets (115,524) 84,967 (147,364) 95,381 (66,957) (99,271)
Net Assets:
Beginning of year 344,633 259,666 533,430 438,049 584,161 683,432
---------- ---------- ---------- ---------- ---------- ----------
End of year $ 229,109 $ 344,633 $ 386,066 $ 533,430 $ 517,204 $ 584,161
========== ========== ========== ========== ========== ==========
</TABLE>
See notes to financial statements.
-5-
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS - (Continued)
YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
MCM MCG MFH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ 9,721 $ 8,684 $ 871 $ 2,431 $ 18,420 $ 23,288
Net realized gains (losses) -- -- -- -- 3,565 9,871
Net unrealized gains (losses) -- -- -- -- (7,688) (28,392)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets from
operations 9,721 8,684 871 2,431 14,297 4,767
---------- ---------- ---------- ---------- ---------- ----------
Contract Owner Transactions:
Accumulation Activity:
Purchase payments received 3,714 21,471 1,823 12,068 1,417 1,602
Net transfers between Sub-Accounts
and Fixed Accounts 235,544 (17,337) -- (54,219) -- (44,464)
Withdrawals, surrenders and account fees (171,604) (58,356) (2,194) (1,371) (89,058) (65,615)
---------- ---------- ---------- ---------- ---------- ----------
Net contract owner activity 67,654 (54,222) (371) (43,522) (87,641) (108,477)
---------- ---------- ---------- ---------- ---------- ----------
Increase (Decrease) in net assets 77,375 (45,538) 500 (41,091) (73,344) (103,710)
Net Assets:
Beginning of year 235,124 280,662 29,575 70,666 263,933 367,643
---------- ---------- ---------- ---------- ---------- ----------
End of year $ 312,499 $ 235,124 $ 30,075 $ 29,575 $ 190,589 $ 263,933
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
MGG MEG
SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Operations:
Net investment income (expense) $ 8,695 $ 8,932 $ (7,671) $ (3,260)
Net realized gains (losses) (8,000) (20,855) 284,005 116,553
Net unrealized gains (losses) (8,638) 21,466 77,632 101,810
---------- ---------- ---------- ----------
Increase (Decrease) in net assets from
operations (7,943) 9,543 353,966 215,103
---------- ---------- ---------- ----------
Contract Owner Transactions:
Accumulation Activity:
Purchase payments received 1,976 5,054 19,249 28,961
Net transfers between Sub-Accounts
and Fixed Accounts (24,901) (112,998) (92,844) (57,971)
Withdrawals, surrenders and account fees (49,021) (81,997) (348,108) (109,475)
---------- ---------- ---------- ----------
Net contract owner activity (71,946) (189,941) (421,703) (138,485)
---------- ---------- ---------- ----------
Increase (Decrease) in net assets (79,889) (180,398) (67,737) 76,618
Net Assets:
Beginning of year 193,280 373,678 1,063,430 986,812
---------- ---------- ---------- ----------
End of year $ 113,391 $ 193,280 $ 995,693 $1,063,430
========== ========== ========== ==========
</TABLE>
See notes to financial statements.
-6-
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT A
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION
Sun Life (N.Y.) Variable Account A (the "Variable Account"), a separate
account of Sun Life Insurance and Annuity Company of New York (the
"Sponsor"), a wholly owned subsidiary of Sun Life Assurance Company of
Canada (U.S.), was established on December 3, 1984 as a funding vehicle
for individual variable annuities. The Variable Account is registered with
the Securities and Exchange Commission under the Investment Company Act of
1940 as a unit investment trust.
The assets of the Variable Account are divided into Sub-Accounts. Each Sub-
Account is invested in shares of a specific mutual fund selected by
contract owners from among available mutual funds (the "Funds") advised by
Massachusetts Financial Services Company ("MFS"), an affiliate of the
Sponsor.
(2) SIGNIFICANT ACCOUNTING POLICIES
GENERAL
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
INVESTMENT VALUATIONS
Investments in the Funds are recorded at their net asset value. Realized
gains and losses on sales of shares of the Funds are determined on the
identified cost basis. Dividend income and capital gain distributions
received by the Sub-Accounts are reinvested in additional Fund shares and
are recognized on the ex-dividend date.
Exchanges between Sub-Accounts requested by contract owners are recorded in
the new Sub-Account upon receipt of the redemption proceeds.
FEDERAL INCOME TAX STATUS
The operations of the Variable Account are part of the operations of the
Sponsor and are not taxed separately. The Variable Account is not taxed as
a regulated investment company. The Sponsor qualifies for the federal
income tax treatment granted to life insurance companies under Subchapter L
of the Internal Revenue Code. Under existing federal income tax law,
investment income and capital gains earned by the Variable Account on
contract owner reserves are not subject to tax.
(3) CONTRACT CHARGES
A mortality and expense risk charge based on the value of the Variable
Account is deducted from the Variable Account at the end of each valuation
period for the mortality and expense risks assumed by the Sponsor. The
deduction is at an effective annual rate of 1.3%.
-7-
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- CONTINUED
Each year on the contract anniversary, a contract maintenance charge
("Account Fee") of $30 is deducted from each contract's accumulation
account to cover administrative expenses relating to the contract. After
the annuity commencement date, the Account Fee is deducted pro rata from
each annuity payment made during the year.
The Sponsor does not deduct a sales charge from purchase payments. However,
a withdrawal charge (contingent deferred sales charge) may be deducted to
cover certain expenses relating to the sale of the contract. In no event
shall the aggregate withdrawal charges exceed 5% of the purchase payments
made under the contract.
-8-
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- CONTINUED
(4) UNIT ACTIVITY FROM PARTICIPANT TRANSACTIONS
<TABLE>
<CAPTION>
MIT MIG MTR
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding, beginning of year 23,908 24,219 16,336 13,024 51,043 67,638
Units purchased 483 1,019 178 360 261 565
Units transferred between Sub-Accounts
and Fixed Accounts (790) 941 1,062 3,998 (1,973) (214)
Units withdrawn and surrendered (4,550) (2,271) (6,450) (1,046) (6,759) (16,946)
---------- ---------- ---------- ---------- ---------- ----------
Units outstanding, end of year 19,051 23,908 11,126 16,336 42,572 51,043
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
MGO MFR MFB
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding, beginning of year 6,850 6,582 9,981 9,945 21,362 25,870
Units purchased 86 93 161 362 682 1,799
Units transferred between Sub-Accounts
and Fixed Accounts 377 793 (1,097) 738 (660) (4,699)
Units withdrawn and surrendered (3,855) (618) (3,136) (1,064) (1,877) (1,608)
---------- ---------- ---------- ---------- ---------- ----------
Units outstanding, end of year 3,458 6,850 5,909 9,981 19,507 21,362
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
MCM MCG MFH
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Units outstanding, beginning of year 14,005 17,324 1,795 4,440 9,605 13,294
Units purchased 219 1,313 109 734 47 58
Units transferred between Sub-Accounts
and Fixed Accounts 13,760 (1,077) -- (3,295) -- (1,518)
Units withdrawn and surrendered (9,968) (3,555) (132) (84) (3,052) (2,229)
---------- ---------- ---------- ---------- ---------- ----------
Units outstanding, end of year 18,016 14,005 1,772 1,795 6,600 9,605
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
MGG MEG
SUB-ACCOUNT SUB-ACCOUNT
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Units outstanding, beginning of year 6,258 12,546 14,523 16,548
Units purchased 90 177 273 452
Units transferred between Sub-Accounts
and Fixed Accounts (873) (3,735) (1,235) (815)
Units withdrawn and surrendered (1,669) (2,730) (4,350) (1,662)
---------- ---------- ---------- ----------
Units outstanding, end of year 3,806 6,258 9,211 14,523
========== ========== ========== ==========
</TABLE>
* * * * *
9
