<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENT OF CONDITION-- June 30, 1999
<TABLE>
<CAPTION>
ASSETS:
Investments in MFS/Sun Life Series Trust: Shares Cost Value
---------- ------------ ------------
<S> <C> <C> <C>
Capital Appreciation Series ("CAS")...... 1,698,316 $ 64,356,597 $ 75,056,921
Government Securities Series ("GSS")..... 1,636,197 20,711,954 20,382,609
High Yield Series ("HYS")................ 1,048,415 9,534,183 9,292,037
Money Market Series ("MMS").............. 12,826,762 12,826,762 12,826,762
Managed Sectors Series ("MSS")........... 434,682 11,868,944 14,231,720
Total Return Series ("TRS").............. 2,015,192 37,214,727 38,581,569
Global Governments Series ("GGS")........ 320,210 3,491,856 3,250,286
------------ ------------
$160,005,023 $173,621,904
------------
------------
LIABILITY:
Payable to sponsor................................................... (98,576)
------------
Net assets..................................................... $173,523,328
------------
------------
</TABLE>
<TABLE>
<CAPTION>
Applicable to Owners of
Deferred Variable Annuity Contracts Reserve for
NET ASSETS: ----------------------------------- Variable
COMPASS 2 CONTRACTS: Units Unit Value Value Annuities Total
--------- ---------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
CAS................................................ 813,120 $ 80.9105 $ 65,786,174 $ 333,274 $ 66,119,448
GSS................................................ 766,787 25.2278 19,341,966 83,000 19,424,966
HYS................................................ 278,430 30.0852 8,379,601 38,249 8,417,850
MMS................................................ 688,583 17.4792 12,027,635 10,107 12,037,742
MSS................................................ 219,339 53.0962 11,675,190 50,755 11,725,945
TRS................................................ 964,038 33.5584 32,447,983 552,373 33,000,356
GGS................................................ 147,912 19.0683 2,833,353 -- 2,833,353
------------ ----------- ------------
$152,491,902 $1,067,758 $153,559,660
------------ ----------- ------------
<CAPTION>
COMPASS 3 CONTRACTS:
<S> <C> <C> <C> <C> <C>
CAS................................................ 343,690 $ 26.0157 $ 8,940,971 $ -- $ 8,940,971
GSS................................................ 76,415 12.5484 958,365 -- 958,365
HYS................................................ 58,704 14.7982 869,150 -- 869,150
MMS................................................ 64,741 12.0365 778,958 -- 778,958
MSS................................................ 112,591 22.3348 2,503,716 -- 2,503,716
TRS................................................ 294,115 18.6882 5,495,575 -- 5,495,575
GGS................................................ 36,142 11.5561 416,933 -- 416,933
------------ ----------- ------------
$ 19,963,668 $ -- $ 19,963,668
------------ ----------- ------------
Net assets............................................................ $172,455,570 $1,067,758 $173,523,328
------------ ----------- ------------
------------ ----------- ------------
</TABLE>
See notes to financial statements
1
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENT OF OPERATIONS-- Six Months Ended June 30, 1999
<TABLE>
<CAPTION>
CAS GSS HYS MMS
Sub-Account Sub-Account Sub-Account Sub-Account
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
INCOME AND EXPENSES:
Dividend income and capital gain distributions
received...................................... $ 8,163,482 $ 995,583 $ 787,775 $ 298,873
Mortality and expense risk charges.............. (469,260) (128,358) (64,734) (89,329)
Distribution expense charges.................... (6,174) (687) (650) (557)
------------ ----------- ------------ ------------
Net investment income (loss)................ $ 7,688,048 $ 866,538 $ 722,391 $ 208,987
------------ ----------- ------------ ------------
REALIZED AND UNREALIZED GAINS (LOSSES):
Realized gains (losses) on investment
transactions
Proceeds from sales........................... $ 9,527,130 $2,003,846 $ 4,115,085 $ 5,052,096
Cost of investments sold...................... (5,872,980) (1,954,228) (4,015,051) (5,052,096)
------------ ----------- ------------ ------------
Net realized gains (losses)................. $ 3,654,150 $ 49,618 $ 100,034 $ --
------------ ----------- ------------ ------------
Net unrealized appreciation (depreciation) on
investments
End of period................................. $ 10,700,324 $ (329,345) $ (242,146) $ --
Beginning of period........................... 16,605,335 1,126,376 124,357 --
------------ ----------- ------------ ------------
Change in unrealized appreciation
(depreciation)............................ $ (5,905,011) $(1,455,721) $ (366,503) $ --
------------ ----------- ------------ ------------
Realized and unrealized gains (losses)........ $ (2,250,861) $(1,406,103) $ (266,469) $ --
------------ ----------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS....................................... $ 5,437,187 $ (539,565) $ 455,922 $ 208,987
------------ ----------- ------------ ------------
------------ ----------- ------------ ------------
</TABLE>
<TABLE>
<CAPTION>
MSS TRS GGS
Sub-Account Sub-Account Sub-Account
----------- ----------- ----------
<S> <C> <C> <C> <C>
INCOME AND EXPENSES:
Dividend income and capital gain distributions
received...................................... $ -- $ 5,628,541 $ 368,146
Mortality and expense risk charges.............. (85,920 ) (243,341) (22,385 )
Distribution expense charges.................... (1,744 ) (3,962) (323 )
----------- ----------- ----------
Net investment income (loss)................ $ (87,664 ) $ 5,381,238 $ 345,438
----------- ----------- ----------
REALIZED AND UNREALIZED GAINS (LOSSES):
Realized gains (losses) on investment
transactions
Proceeds from sales........................... $1,776,521 $ 4,446,039 $ 317,938
Cost of investments sold...................... (1,479,799 ) (3,323,323) (326,278 )
----------- ----------- ----------
Net realized gains (losses)................. $ 296,722 $ 1,122,716 $ (8,340 )
----------- ----------- ----------
Net unrealized appreciation (depreciation) on
investments
End of period................................. $2,362,776 $ 1,366,842 $(241,570 )
Beginning of period........................... 641,306 6,224,618 377,097
----------- ----------- ----------
Change in unrealized appreciation
(depreciation)............................ $1,721,470 $(4,857,776) $(618,667 )
----------- ----------- ----------
Realized and unrealized gains (losses)........ $2,018,192 $(3,735,060) $(627,007 )
----------- ----------- ----------
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS....................................... $1,930,528 $ 1,646,178 $(281,569 )
----------- ----------- ----------
----------- ----------- ----------
</TABLE>
See notes to financial statements
2
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
CAS GSS
Sub-Account Sub-Account
------------------------------- -------------------------------
Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31,
June 30, 1999 1998 June 30, 1999 1998
--------------- ------------- -------------- --------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss).............................. $ 7,688,048 $ 7,202,019 $ 866,538 $ 898,057
Net realized gains (losses)............................... 3,654,150 10,266,206 49,618 521,218
Net unrealized gains (losses)............................. (5,905,011) 86,450 (1,455,721) 75,036
--------------- ------------- -------------- --------------
Increase (Decrease) in net assets from operations..... $ 5,437,187 $17,554,675 $ (539,565) $ 1,494,311
--------------- ------------- -------------- --------------
CONTRACT OWNER TRANSACTIONS:
Accumulation Activity:
Purchase payments received.............................. $ 972,052 $ 2,540,950 $ 197,321 $ 664,851
Net transfers between Sub-Accounts and Fixed Account.... (1,502,313) (3,626,538) 2,057,260 (871,865)
Withdrawals, surrenders, annuitizations and contract
charges............................................... (4,622,750) (9,568,674) (1,393,889) (3,638,620)
--------------- ------------- -------------- --------------
Net accumulation activity............................. $ (5,153,011) $(10,654,262) $ 860,692 $ (3,845,634)
--------------- ------------- -------------- --------------
Annuitization Activity:
Annuitizations.......................................... $ -- $ 52,914 $ -- $ --
Annuity payments and contract charges................... (19,181) (30,074) (5,627) (12,398)
Adjustments to annuity reserve.......................... (1,845) (2,453) (294) 666
--------------- ------------- -------------- --------------
Net annuitization activity............................ $ (21,026) $ 20,387 $ (5,921) $ (11,732)
--------------- ------------- -------------- --------------
Increase (Decrease) in net assets from contract owner
transactions............................................ $ (5,174,037) $(10,633,875) $ 854,771 $ (3,857,366)
--------------- ------------- -------------- --------------
Increase (Decrease) in net assets....................... $ 263,150 $ 6,920,800 $ 315,206 $ (2,363,055)
NET ASSETS:
Beginning of period....................................... 74,797,269 67,876,469 20,068,125 22,431,180
--------------- ------------- -------------- --------------
End of period............................................. $ 75,060,419 $74,797,269 $20,383,331 $ 20,068,125
--------------- ------------- -------------- --------------
--------------- ------------- -------------- --------------
</TABLE>
See notes to financial statements
3
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENTS OF CHANGES IN NET ASSETS -- continued
<TABLE>
<CAPTION>
HYS MMS
Sub-Account Sub-Account
------------------------------ -------------------------------
Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31,
June 30, 1999 1998 June 30, 1999 1998
-------------- ------------- -------------- --------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss).............................. $ 722,391 $ 632,722 $ 208,987 $ 456,307
Net realized gains (losses)............................... 100,034 346,052 -- --
Net unrealized gains (losses)............................. (366,503) (1,027,552) -- --
-------------- ------------- -------------- --------------
Increase (Decrease) in net assets from operations..... $ 455,922 $ (48,778) $ 208,987 $ 456,307
-------------- ------------- -------------- --------------
CONTRACT OWNER TRANSACTIONS:
Accumulation Activity:
Purchase payments received.............................. $ 90,906 $ 210,963 $ 182,055 $ 307,131
Net transfers between Sub-Accounts and Fixed Account.... (216,523) (1,472,620) 836,631 7,369,452
Withdrawals, surrenders, annuitizations and contract
charges............................................... (1,371,920) (1,495,462) (1,861,689) (7,077,196)
-------------- ------------- -------------- --------------
Net accumulation activity............................. $(1,497,537) $(2,757,119) $ (843,003) $ 599,387
-------------- ------------- -------------- --------------
Annuitization Activity:
Annuity payments and contract charges................... $ (2,412) $ (4,897) $ (532) $ (1,057)
Adjustments to annuity reserves......................... (81) 56 (231) (471)
-------------- ------------- -------------- --------------
Net annuitization activity............................ $ (2,493) $ (4,841) $ (763) $ (1,528)
-------------- ------------- -------------- --------------
Increase (Decrease) in net assets from contract owner
transactions............................................ $(1,500,030) $(2,761,960) $ (843,766) $ 597,859
-------------- ------------- -------------- --------------
Increase (Decrease) in net assets....................... $(1,044,108) $(2,810,738) $ (634,779) 1,054,166
NET ASSETS:
Beginning of period....................................... 10,331,108 13,141,846 13,451,479 12,397,313
-------------- ------------- -------------- --------------
End of period............................................. $ 9,287,000 $10,331,108 $12,816,700 $ 13,451,479
-------------- ------------- -------------- --------------
-------------- ------------- -------------- --------------
</TABLE>
See notes to financial statements
4
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENTS OF CHANGES IN NET ASSETS -- continued
<TABLE>
<CAPTION>
MSS TRS
Sub-Account Sub-Account
------------------------------ -----------------------------
Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31,
June 30, 1999 1998 June 30, 1999 1998
--------------- ------------ -------------- ------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss)......................... $ (87,664) $ 1,746,947 $ 5,381,238 $ 4,241,657
Net realized gains (losses).......................... 296,722 894,798 1,122,716 3,450,365
Net unrealized gains (losses)........................ 1,721,470 (1,357,946) (4,857,776) (3,487,755 )
--------------- ------------ -------------- ------------
Increase (Decrease) in net assets from
operations..................................... $ 1,930,528 $ 1,283,799 $ 1,646,178 $ 4,204,267
--------------- ------------ -------------- ------------
CONTRACT OWNER TRANSACTIONS:
Accumulation Activity:
Purchase payments received......................... $ 267,701 $ 828,932 $ 442,182 $ 1,457,947
Net transfers between Sub-Accounts and Fixed
Account.......................................... 355,919 179,600 (1,186,403) (1,063,470 )
Withdrawals, surrenders, annuitizations and
contract charges................................. (1,216,231) (2,473,049) (2,985,019) (8,364,694 )
--------------- ------------ -------------- ------------
Net accumulation activity........................ $ (592,611) $(1,464,517) $ (3,729,240) $(7,970,217 )
--------------- ------------ -------------- ------------
Annuitization Activity:
Annuitizations................................... $ -- $ 52,940 $ -- $ --
Annuity payments and contract charges............ (3,962) (3,921) (47,043) (92,029 )
Adjustments to annuity reserves.................. (619) (564) (7,293) (14,828 )
--------------- ------------ -------------- ------------
Net annuitization activity....................... $ (4,581) $ 48,455 $ (54,336) $ (106,857 )
--------------- ------------ -------------- ------------
Increase (Decrease) in net assets from contract owner
transactions....................................... $ (597,192) $(1,416,062) $ (3,783,576) $(8,077,074 )
--------------- ------------ -------------- ------------
Increase (Decrease) in net assets.................. $ 1,333,336 $ (132,263) $ (2,137,398) $(3,872,807 )
NET ASSETS:
Beginning of period.................................. 12,896,325 13,028,588 40,633,329 44,506,136
--------------- ------------ -------------- ------------
End of period........................................ $14,229,661 $12,896,325 $ 38,495,931 $40,633,329
--------------- ------------ -------------- ------------
--------------- ------------ -------------- ------------
</TABLE>
See notes to financial statements
5
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
STATEMENTS OF CHANGES IN NET ASSETS -- continued
<TABLE>
<CAPTION>
GGS
Sub-Account
------------------------------
Six Months Year Ended
Ended December 31,
June 30, 1999 1998
--------------- ------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss)......................... $ 345,438 $ (289)
Net realized gains (losses).......................... (8,340) (239,837)
Net unrealized gains (losses)........................ (618,667) 738,143
--------------- ------------
Increase (Decrease) in net assets from
operations..................................... $ (281,569) $ 498,017
--------------- ------------
CONTRACT OWNER TRANSACTIONS:
Accumulation Activity:
Purchase payments received......................... $ 65,841 $ 172,382
Net transfers between Sub-Accounts and Fixed
Account.......................................... (118,005) (760,745)
Withdrawals, surrenders, annuitizations and
contract charges................................. (160,778) (1,301,883)
--------------- ------------
Net accumulation activity........................ $ (212,942) $(1,890,246)
--------------- ------------
Annuitization Activity:
Annuitizations..................................... $ -- $ --
Annuity payments and contract charges.............. -- --
Adjustments to annuity reserves.................... -- --
--------------- ------------
Net annuitization activity....................... $ -- $ --
--------------- ------------
Increase (Decrease) in net assets from contract owner
transactions....................................... $ (212,942) $(1,890,246)
--------------- ------------
Increase (Decrease) in net assets.................. $ (494,511) $(1,392,229)
NET ASSETS:
Beginning of period.................................. 3,744,797 5,137,026
--------------- ------------
End of period........................................ $ 3,250,286 $ 3,744,797
--------------- ------------
--------------- ------------
</TABLE>
See notes to financial statements
6
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION
Sun Life (N.Y.) Variable Account B (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 series of MFS/Sun Life Series
Trust (the "Series Trust") as selected by contract owners. The Series Trust is
an open-end management investment company registered under the Investment
Company Act of 1940. Massachusetts Financial Services Company ("MFS"), an
affiliate of Sun Life Assurance Company of Canada (U.S.), is investment adviser
to the Series Trust.
(2) SIGNIFICANT ACCOUNTING POLICIES
GENERAL
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Sponsor's management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
INVESTMENT VALUATIONS
Investments in shares of the Series Trust are recorded at their net asset value.
Realized gains and losses on sales of shares of the Series Trust are determined
on the identified cost basis. Dividend income and capital gain distributions
received by the Sub-Accounts are reinvested in additional Series Trust shares
and are recognized on the ex-dividend date.
Exchanges between Sub-Accounts requested by contract owners are recorded in the
new Sub-Account upon receipt of the redemption proceeds.
FEDERAL INCOME TAX STATUS
The operations of the Variable Account are part of the operations of the Sponsor
and are not taxed separately. The Variable Account is not taxed as a regulated
investment company. The Sponsor qualifies for the federal income tax treatment
granted to life insurance companies under Subchapter L of the Internal Revenue
Code. Under existing federal income tax law, investment income and capital gains
earned by the Variable Account on contract owner reserves are not taxable, and
therefore, no provision has been made for federal income taxes.
(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
7
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
NOTES TO FINANCIAL STATEMENTS -- continued
(3) CONTRACT CHARGES -- continued
Sponsor. These deductions are transferred periodically to the Sponsor.
Currently, the deduction is at an effective annual rate of 1.3% of the assets of
the Variable Account attributable to Compass 2 contracts and 1.25% of the assets
of the Variable Account attributable to Compass 3 contracts.
Each year on the contract anniversary, a contract maintenance charge of $30 is
deducted from each contract's accumulation account to cover administrative
expenses relating to the contract. After the annuity commencement date the
charge 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 (including the distribution expense charge
described below applicable to Compass 3 contracts) exceed 5% of the purchase
payments made under a Compass 2 contract or 9% of the purchase payments made
under a Compass 3 contract.
For assuming the risk that withdrawal charges may be insufficient to compensate
it for the costs of distributing the Compass 3 contracts, the Sponsor makes a
deduction from the Variable Account at the end of each valuation period for the
first seven contract years (during both the accumulation period and, if
applicable, after annuity payments begin) at an effective annual rate of 0.15%
of the assets of the Variable Account attributable to such contracts. No
deduction is made after the seventh contract anniversary. No such deduction is
made with respect to assets attributable to Compass 2 contracts.
(4) ANNUITY RESERVES
Annuity reserves for contracts with annuity commencement dates prior to February
1, 1987 have been calculated using the 1971 Individual Annuitant Mortality
Table. Annuity reserves for contracts with annuity commencement dates on or
after February 1, 1987 are calculated using the 1983 Individual Annuitant
Mortality Table. All annuity reserves are calculated using an assumed interest
rate of 4%. Required adjustments to the reserve are accomplished by transfers to
or from the Sponsor.
8
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
NOTES TO FINANCIAL STATEMENTS -- continued
(5) UNIT ACTIVITY FROM PARTICIPANT TRANSACTIONS
<TABLE>
<CAPTION>
CAS GSS HYS
Sub-Account Sub-Account Sub-Account
------------------------- ------------------------- ---------------------
Six
Six Months Six Months Months Year
Ended Year Ended Ended Year Ended Ended Ended
June 30, December June 30, December June 30, December
COMPASS 2 CONTRACTS: 1999 31, 1998 1999 31, 1998 1999 31, 1998
- ---------------------- ----------- ----------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Units Outstanding
Beginning of Period 881,482 1,049,111 737,003 897,267 327,184 421,472
Units purchased 6,006 15,299 7,978 17,550 1,616 2,836
Units transferred
between
Sub-Accounts and
Fixed Account (17,981) (44,627) 74,670 (36,206) (6,936) (49,178)
Units withdrawn,
surrendered, and
annuitized (56,387) (138,301) (52,864) (141,608) (43,434) (47,946)
----------- ----------- ----------- ----------- --------- ---------
Units Outstanding End
of Period 813,120 881,482 766,787 737,003 278,430 327,184
----------- ----------- ----------- ----------- --------- ---------
----------- ----------- ----------- ----------- --------- ---------
<CAPTION>
MSS TRS GGS
Sub-Account Sub-Account Sub-Account
------------------------- ------------------------- ---------------------
Six
Six Months Six Months Months Year
Ended Year Ended Ended Year Ended Ended Ended
June 30, December June 30, December June 30, December
1999 31, 1998 1999 31, 1998 1999 31, 1998
----------- ----------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Units Outstanding
Beginning of Period 230,507 270,624 1,076,662 1,345,153 158,924 256,940
Units purchased 2,022 6,466 7,952 18,920 2,301 5,460
Units transferred
between
Sub-Accounts and
Fixed Account 8,469 3,355 (35,064) (33,825) (5,680) (37,228)
Units withdrawn,
surrendered, and
annuitized (21,659) (49,938) (85,512) (253,586) (7,633) (66,248)
----------- ----------- ----------- ----------- --------- ---------
Units Outstanding End
of Period 219,339 230,507 964,038 1,076,662 147,912 158,924
----------- ----------- ----------- ----------- --------- ---------
----------- ----------- ----------- ----------- --------- ---------
<CAPTION>
MMS
Sub-Account
-----------------------
Six Months
Ended Year Ended
June 30, December
COMPASS 2 CONTRACTS: 1999 31, 1998
- ---------------------- ---------- ----------
<S> <C> <C>
Units Outstanding
Beginning of Period 745,670 713,552
Units purchased 9,312 11,975
Units transferred
between
Sub-Accounts and
Fixed Account 39,432 426,262
Units withdrawn,
surrendered, and
annuitized (105,831) (406,119)
---------- ----------
Units Outstanding End
of Period 688,583 745,670
---------- ----------
---------- ----------
<S> <C> <C>
Units Outstanding
Beginning of Period
Units purchased
Units transferred
between
Sub-Accounts and
Fixed Account
Units withdrawn,
surrendered, and
annuitized
Units Outstanding End
of Period
</TABLE>
9
<PAGE>
SUN LIFE (N.Y.) VARIABLE ACCOUNT B
NOTES TO FINANCIAL STATEMENTS -- continued
(5) UNIT ACTIVITY FROM PARTICIPANT TRANSACTIONS -- continued
<TABLE>
<CAPTION>
CAS GSS HYS
Sub-Account Sub-Account Sub-Account
--------------------- --------------------- -------------------
Six Year Six Year Six Year
Months Ended Months Ended Months Ended
Ended December Ended December Ended December
June 30, 31, June 30, 31, June 30, 31,
COMPASS 3 CONTRACTS: 1999 1998 1999 1998 1999 1998
- ------------------------- --------- --------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Units Outstanding
Beginning of Period 339,067 291,968 67,394 55,194 60,336 60,217
Units purchased 22,078 73,560 2,520 17,879 3,153 8,915
Units transferred
between
Sub-Accounts and
Fixed Account (5,066) (4,596) 10,094 3,622 (538) (2,262)
Units withdrawn,
surrendered, and
annuitized (12,389) (21,865) (3,593) (9,301) (4,247) (6,534)
--------- --------- --------- --------- -------- --------
Units Outstanding End of
Period 343,690 339,067 76,415 67,394 58,704 60,336
--------- --------- --------- --------- -------- --------
--------- --------- --------- --------- -------- --------
<CAPTION>
MSS TRS GGS
Sub-Account Sub-Account Sub-Account
--------------------- --------------------- -------------------
Six Year Six Year Six Year
Months Ended Months Ended Months Ended
Ended December Ended December Ended December
June 30, 31, June 30, 31, June 30, 31,
1999 1998 1999 1998 1999 1998
--------- --------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Units Outstanding
Beginning of Period 113,778 100,687 296,455 281,915 35,645 42,551
Units purchased 8,403 29,949 11,750 51,882 1,957 5,735
Units transferred
between
Sub-Accounts and
Fixed Account (4,203) (2,112) (4,665) (2,829) (689) (7,056)
Units withdrawn,
surrendered, and
annuitized (5,387) (14,746) (9,425) (34,513) (771) (5,585)
--------- --------- --------- --------- -------- --------
Units Outstanding End of
Period 112,591 113,778 294,115 296,455 36,142 35,645
--------- --------- --------- --------- -------- --------
--------- --------- --------- --------- -------- --------
<CAPTION>
MMS
Sub-Account
---------------------
Six Year
Months Ended
Ended December
June 30, 31,
COMPASS 3 CONTRACTS: 1999 1998
- ------------------------- --------- ---------
<S> <C> <C>
Units Outstanding
Beginning of Period 51,357 47,433
Units purchased 2,001 9,088
Units transferred
between
Sub-Accounts and
Fixed Account 12,971 15,416
Units withdrawn,
surrendered, and
annuitized (1,588) (20,580)
--------- ---------
Units Outstanding End of
Period 64,741 51,357
--------- ---------
--------- ---------
<S> <C> <C>
Units Outstanding
Beginning of Period
Units purchased
Units transferred
between
Sub-Accounts and
Fixed Account
Units withdrawn,
surrendered, and
annuitized
Units Outstanding End of
Period
</TABLE>
10
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Participants in Sun Life (N.Y.) Variable Account B
and the Board of Directors of Sun Life Insurance and Annuity Company of New
York:
We have audited the accompanying statement of condition of Capital Appreciation
Sub-Account, Government Securities Sub-Account, High Yield Sub-Account, Money
Market Sub-Account, Managed Sectors Sub-Account, Total Return Sub-Account and
Global Governments Sub-Account of Sun Life (N.Y.) Variable Account B (the
"Sub-Accounts") as of June 30, 1999, the related statement of operations for the
six month period then ended and the statements of changes in net assets for the
six month period ended June 30, 1999 and the year ended December 31, 1998. These
financial statements are the responsibility of management. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities held at June 30, 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 June 30, 1999, the
results of their operations and the changes in their net assets for the
respective stated periods in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
August 6, 1999
----------------------------------------
This report is prepared for the general information of contract owners. It is
authorized for distribution to prospective purchasers only when preceded or
accompanied by an effective prospectus.
<PAGE>
SUN LIFE INSURANCE AND ANNUITY COMPANY
OF NEW YORK
80 Broad Street, New York, NY 10004
DIRECTORS AND OFFICERS
DONALD A. STEWART, Chairman and
Director
C. JAMES PRIEUR, President and Director
JAMES A. McNULTY, III, Senior Vice
President
[LOGO]PROFESSIONALLY MANAGED COMBINATION
and General Manager and Director
FIXED/VARIABLE ANNUITIES
S. CAESAR RABOY, Director
FOR PERSONAL INVESTMENTS AND
QUALIFIED RETIREMENT PLANS
RICHARD B. BAILEY, Director
------------------------------------------------
M. COLYER CRUM, Director
SEMI-ANNUAL REPORT, JUNE 30, 1999
DAVID D. HORN, Director
JOHN G. IRELAND, Director
GREGORY W. GEE, Director
DONALD B. HENDERSON, Jr., Director
ANGUS A. MacNAUGHTON, Director
PETER R. O'FLINN, Director
FIORAVANTE G. PERROTTA, Director
RALPH F. PETERS, Director
FREDERICK B. WHITTEMORE, Director
PETER F. DEMUTH, Vice President and
Chief
Counsel and Assistant Secretary
ELLEN B. KING, Secretary
ROBERT VROLYK, Vice President,
Treasurer,
Controller and Actuary
JAMES M. A. ANDERSON, Vice President,
Investments
[LOGO]
GENERAL DISTRIBUTOR
Clarendon Insurance Agency, Inc.
One Sun Life Executive Park
Wellesley Hills, Massachusetts 02481
LEGAL COUNSEL
Covington & Burling
1201 Pennsylvania Avenue, N.W.
P.O. Box 7566, Washington, D.C. 20044
AUDITORS
Deloitte & Touche LLP
200 Berkeley Street, Boston,
Massachusetts 02116
ISSUED BY
RENY3-8/99 5M SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
