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<PAGE> PAGE 2
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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<PAGE> PAGE 5
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<PAGE> PAGE 6
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<PAGE> PAGE 7
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<PAGE> PAGE 8
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<PAGE> PAGE 9
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<PAGE> PAGE 10
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<PAGE> PAGE 11
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<PAGE> PAGE 12
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<PAGE> PAGE 13
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<PAGE> PAGE 14
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<PAGE> PAGE 15
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<PAGE> PAGE 16
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<PAGE> PAGE 17
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SIGNATURE PAUL BROOK
TITLE CONTROLLER
[ARTICLE] 6
[CIK] 0000808244
[NAME] SMITH BARNEY VARIABLE ACCOUNT FUNDS
[SERIES]
[NUMBER] 1
[NAME] INCOME AND GROWTH PORTFOLIO
<TABLE>
<S> <C>
[PERIOD-TYPE] YEAR
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] DEC-31-1998
[INVESTMENTS-AT-COST] 9,781,336
[INVESTMENTS-AT-VALUE] 13,782,281
[RECEIVABLES] 17,863
[ASSETS-OTHER] 0
[OTHER-ITEMS-ASSETS] 290
[TOTAL-ASSETS] 13,800,434
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 22,001
[TOTAL-LIABILITIES] 22,001
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 7,164,094
[SHARES-COMMON-STOCK] 985,475
[SHARES-COMMON-PRIOR] 939,010
[ACCUMULATED-NII-CURRENT] 220,184
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 2,393,210
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 4,000,945
[NET-ASSETS] 13,778,433
[DIVIDEND-INCOME] 323,316
[INTEREST-INCOME] 15,884
[OTHER-INCOME] 339,200
[EXPENSES-NET] 112,886
[NET-INVESTMENT-INCOME] 226,314
[REALIZED-GAINS-CURRENT] 2,388,392
[APPREC-INCREASE-CURRENT] (850,939)
[NET-CHANGE-FROM-OPS] 1,763,767
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] 396,112
[DISTRIBUTIONS-OF-GAINS] 4,050,110
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 23,858
[NUMBER-OF-SHARES-REDEEMED] 299,350
[SHARES-REINVESTED] 321,957
[NET-CHANGE-IN-ASSETS] (2,457,532)
[ACCUMULATED-NII-PRIOR] 405,947
[ACCUMULATED-GAINS-PRIOR] 4,040,960
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 88,984
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 88,984
[AVERAGE-NET-ASSETS] 0
[PER-SHARE-NAV-BEGIN] 17.29
[PER-SHARE-NII] 00.29
[PER-SHARE-GAIN-APPREC] 01.87
[PER-SHARE-DIVIDEND] 00.49
[PER-SHARE-DISTRIBUTIONS] 04.98
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 13.98
[EXPENSE-RATIO] 00.76
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
[ARTICLE] 6
[CIK] 0000808244
[NAME] SMITH BARNEY VARIBLE ACCOUNT FUNDS
[SERIES]
[NUMBER] 3
[NAME] U.S. GOV'T./HIGH QUALITY SECURITIES PORTFOLIO
<TABLE>
<S> <C>
[PERIOD-TYPE] YEAR
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] DEC-31-1998
[INVESTMENTS-AT-COST] 220,000
[INVESTMENTS-AT-VALUE] 220,000
[RECEIVABLES] 25,312
[ASSETS-OTHER] 72
[OTHER-ITEMS-ASSETS] 740,247
[TOTAL-ASSETS] 985,631
[PAYABLE-FOR-SECURITIES] 35
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 12,596
[TOTAL-LIABILITIES] 12,631
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 972,290
[SHARES-COMMON-STOCK] 93,570
[SHARES-COMMON-PRIOR] 127,737
[ACCUMULATED-NII-CURRENT] 710
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 0
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 0
[NET-ASSETS] 973,000
[DIVIDEND-INCOME] 0
[INTEREST-INCOME] 14,274
[OTHER-INCOME] 0
[EXPENSES-NET] 11,732
[NET-INVESTMENT-INCOME] 2,542
[REALIZED-GAINS-CURRENT] 0
[APPREC-INCREASE-CURRENT] 0
[NET-CHANGE-FROM-OPS] 2,542
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] 0
[DISTRIBUTIONS-OF-GAINS] 0
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 19,525
[NUMBER-OF-SHARES-REDEEMED] 72,448
[SHARES-REINVESTED] 18,756
[NET-CHANGE-IN-ASSETS] (644,165)
[ACCUMULATED-NII-PRIOR] 88,295
[ACCUMULATED-GAINS-PRIOR] 104,742
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 5,279
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 21,843
[AVERAGE-NET-ASSETS] 1,174,560
[PER-SHARE-NAV-BEGIN] 12.66
[PER-SHARE-NII] 00.03
[PER-SHARE-GAIN-APPREC] 0
[PER-SHARE-DIVIDEND] 1.06
[PER-SHARE-DISTRIBUTIONS] 1.23
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 10.40
[EXPENSE-RATIO] 1.00
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
[ARTICLE] 6
[CIK] 0000808244
[NAME] SMITH BARNEY VARIABLE ACCOUNT FUNDS
[SERIES]
[NUMBER] 2
[NAME] RESERVE ACCOUNT PORTFOLIO
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] DEC-31-1998
[INVESTMENTS-AT-COST] 0
[INVESTMENTS-AT-VALUE] 0
[RECEIVABLES] 58,442
[ASSETS-OTHER] 38
[OTHER-ITEMS-ASSETS] 3,840
[TOTAL-ASSETS] 62,320
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 5,908
[TOTAL-LIABILITIES] 5,908
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 58,545
[SHARES-COMMON-STOCK] 7,669
[SHARES-COMMON-PRIOR] 12,593
[ACCUMULATED-NII-CURRENT] 0
[OVERDISTRIBUTION-NII] (2,133)
[ACCUMULATED-NET-GAINS] 0
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 0
[NET-ASSETS] 56,412
[DIVIDEND-INCOME] 0
[INTEREST-INCOME] 0
[OTHER-INCOME] 0
[EXPENSES-NET] 802
[NET-INVESTMENT-INCOME] (802)
[REALIZED-GAINS-CURRENT] 0
[APPREC-INCREASE-CURRENT] 0
[NET-CHANGE-FROM-OPS] 0
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] 2,677
[DISTRIBUTIONS-OF-GAINS] 0
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 271
[NUMBER-OF-SHARES-REDEEMED] 5,557
[SHARES-REINVESTED] 362
[NET-CHANGE-IN-ASSETS] (40,566)
[ACCUMULATED-NII-PRIOR] 857
[ACCUMULATED-GAINS-PRIOR] 0
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 361
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 16,715
[AVERAGE-NET-ASSETS] 80,314
[PER-SHARE-NAV-BEGIN] 7.70
[PER-SHARE-NII] (0.07)
[PER-SHARE-GAIN-APPREC] 0
[PER-SHARE-DIVIDEND] 0.27
[PER-SHARE-DISTRIBUTIONS] 0
[RETURNS-OF-CAPITAL] 0
[PER-SHARE-NAV-END] 7.36
[EXPENSE-RATIO] 1.00
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
</TABLE>
To the Shareholders and Board of Trustees of
Smith Barney Variable Account Funds:
In planning and performing our audit of the financial statements
of Income and Growth, U.S. Government/High Quality Securities,
and Reserve Account Portfolios (the "Funds") of Smith Barney
Variable Account Funds for the year ended December 31, 1998, we
considered its internal control, including control activities for
safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the
financial statements and to comply with the requirements of Form
N-SAR, not to provide assurance on the internal control.
The management of the Funds is responsible for establishing and
maintaining internal control. In fulfilling this responsibility,
estimates and judgments by management are required to assess the
expected benefits and related costs of controls. Generally,
controls that are relevant to an audit pertain to the entity's
objective of preparing financial statements for external purposes
that are fairly presented in conformity with generally accepted
accounting principles. Those controls include the safeguarding of
assets against unauthorized acquisition, use, or disposition.
Because of inherent limitations in internal control, errors or
fraud may occur and not be detected. Also, projection of any
evaluation of internal control to future periods is subject to
the risk that it may become inadequate because of changes in
conditions or that the effectiveness of the design and operation
may deteriorate.
Our consideration of the internal control would not necessarily
disclose all matters in the internal control that might be
material weaknesses under standards established by the American
Institute of Certified Public Accountants. A material weakness
is a condition in which the design or operation of one or more of
the internal control components does not reduce to a relatively
low level the risk that misstatements caused by error or fraud in
amounts that would be material in relation to the financial
statements being audited may occur and not be detected within a
timely period by employees in the normal course of performing
their assigned functions. However, we noted no matters involving
the internal control and its operation, including controls for
safeguarding securities that we consider to be material
weaknesses as defined above.
This report is intended solely for the information and use of
management, the Board of Trustees of the Funds, and the
Securities and Exchange Commission.
February 8, 1999
