DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to provide you with this report on Dreyfus Variable
Investment Fund - Growth and Income Portfolio. For the year ended December
31, 1996, the total return for your Portfolio was 20.75%, based on net asset
value.* This compares with a total return of 22.95% for the Standard and
Poor's 500 Composite Stock Price Index (the S&P 500).** From inception on May
2, 1994 to December 31, 1996, the total return for the Portfolio was 93.11%,
and the average annual total return was 27.97%.*** Such a rise in the
slightly more than two and a half years of the existence of the Portfolio is
well above the historical average of returns in the equity market and we
believe that it is unlikely to be repeated.
Since inception on May 2, 1994, the assets of the Portfolio have grown to
$225.9 million as of December 31, 1996. With a mix of different sized
companies included in the Portfolio, the average market capitalization of
companies held in the Portfolio is less than the average of companies in the
Standard and Poor's 500 Composite Stock Price Index.
During the fiscal year, our approach was to mix together some securities
for growth and others for income. We have also included a mix of large
capitalization stocks, mid-capitalization stocks and small capitalization
stocks.
This mix of investments is illustrated by the largest common stock
holdings in the Portfolio. Gannett is a major newspaper company, owning such
properties as the newspaper "USA Today." UGI is a gas utility which also has
an important investment in a propane company. Columbia/HCA Healthcare is the
largest hospital company in the U.S. Merry Land & Investment is an apartment
real estate investment trust. Nabisco Holdings, Cl. A is a major consumer
products company. Viacom, Cl. B and Time Warner are large media companies
whose stocks have been laggards in the market. International Game Technology
provides equipment to the gaming industry worldwide. Computer Sciences
provides computer management and outsourcing to many of the largest
corporations in the U.S. and overseas. OfficeMax is a nationwide office
supplies superstore company.
We believe that many of the securities currently held in the Portfolio
have not yet fully participated in the powerful gains which have been
realized in the stock market in the last few years. These positions
contributed to the Portfolio's slight underperformance of its benchmark
index. Some of them fit into the category of valuable business franchises
which, we believe, are somewhat out of favor because of near-term
disappointments.
We use a mixture of convertible securities, real estate investment trusts
and utilities as a means of satisfying the income portion of the Portfolio's
joint objectives of growth and income. Both the utility indexes and the
convertible securities indexes lagged the return on the Standard and Poor's
Composite 500 Stock Price Index in 1996, a year in which bond prices lagged
behind stock prices, and therefore also contributed to the Portfolio's slight
underperformance of that index. The Portfolio includes investments in the
convertible securities of Thermo Electron, Airtouch Communications and Home
Depot, among others.
Several long-term positive forces have provided a supportive background
for the financial markets over the last several years. First, the trend of
inflation has remained generally favorable in the last several years. Second,
we are in the early stages of a key demographic shift as the baby boom
generation begins to focus on the need for a permanent program of saving to
provide for future retirement income. Third, U.S. productivity growth in
manufacturing has been favorable and many U.S. companies are quite
competitive with their foreign competitors.
We continue to believe that the period of strongest earnings growth in
the U.S. economy is behind us. Corporate cost cutting is very far advanced in
many companies as are the benefits of refinancing high cost debt. We believe
that strong profit growth may become increasingly scarce over the next year.
We appreciate the willingness of our shareholders to invest in the Growth
and Income Portfolio of Dreyfus Variable Investment Fund. We will endeavor to
realize a favorable return for the shareholders commensurate with a
reasonable level
of risk. There is likely to be an alternation of periods where the net asset
value of the Portfolio declines and periods when the net asset value rises.
Our focus is on achieving a satisfactory return for the shareholders over a
period of time.
Very truly yours,
(Richard B. Hoey signature logo)
Richard B. Hoey
Portfolio Manager
January 20, 1997
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid. The Portfolio's performance does not reflect the deduction of
additional charges imposed in connection with investing in variable annuity
contracts and variable life insurance policies.
**SOURCE: LIPPER ANALYTICAL SERVICES, INC. - Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of stock market performance.
*** Fund's share price and investment return fluctuate so you may receive
more or less than your original cost upon redemption. Past performance is no
guarantee of future results.
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
DECEMBER 31, 1996
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS VARIABLE
INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO AND THE STANDARD & POOR'S 500
COMPOSITE STOCK PRICE INDEX
$19,311
Dreyfus Variable
Investment Fund, Growth
and Income Portfolio
Dollars
$17,580
Standard & Poor's 500
Composite Stock Price
Index*
*Source: Lipper Analytical Services, Inc.
<TABLE>
Average Annual Total Returns
One Year Ended From Inception (5/2/94)
December 31, 1996 to December 31, 1996
----------------- ---------------------
<S> <C> <C>
20.75% 27.97%
</TABLE>
Past performance is not predictive of future performance.
The Portfolio's performance does not reflect the deduction of additional
charges imposed in connection with investing in variable annuity contracts
and variable life insurance policies.
The above graph compares a $10,000 investment made in Dreyfus Variable
Investment Fund, Growth and Income Portfolio on 5/2/94 (Inception Date) to a
$10,000 investment made in the Standard & Poor's 500 Composite Stock Price
Index on that date. For comparative purposes, the value of the Index on
4/30/94 is used as the beginning value on 5/2/94. All dividends and capital
gain distributions are reinvested.
The Portfolio's performance shown in the line graph takes into account all
applicable fees and expenses of the Portfolio. The Standard & Poor's 500
Composite Stock Price Index is a widely accepted, unmanaged index of overall
stock market performance, which does not take into account charges, fees and
other expenses. Further information relating to Portfolio performance,
including expense reimbursements, if applicable, is contained in the
Financial Highlights section of the Prospectus and elsewhere in this report.
<TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF INVESTMENTS DECEMBER 31, 1996
Common Stocks-71.4% Shares Value
---------------- ----------------
<S> <C> <C>
Basic and Process
Industries-1.3%. duPont (El) deNemours........................ 30,000 $ 2,831,250
----------------
Capital Goods-5.4%. Boeing....................................... 20,000 2,127,500
Deere & Co................................... 75,000 3,046,875
Thermo Instrument Systems.................... 100,000 (a) 3,312,500
Thiokol...................................... 80,000 3,580,000
----------------
12,066,875
----------------
Consumer-10.0% ADT Limited.................................. 75,000 (a) 1,715,625
Dal-Tile..................................... 71,000 (a) 1,446,625
Ford Motor................................... 100,000 3,187,500
Nabisco Holdings, Cl. A...................... 150,000 5,831,250
OfficeMax.................................... 500,000 (a) 5,312,500
Sunglass Hut................................. 685,000 (a) 4,966,250
----------------
22,459,750
----------------
Energy-7.8% Amerada Hess................................. 50,000 2,893,750
Louisiana Land & Exploration................. 90,000 4,826,250
Occidental Petroleum......................... 100,000 2,337,500
UGI.......................................... 300,000 6,712,500
Western Gas Resources........................ 44,400 854,700
----------------
17,624,700
----------------
Financial-2.5% ADVANTA, Cl. B............................... 40,000 1,635,000
Federal National Mortgage Association........ 50,000 1,862,500
Great Western Financial...................... 75,000 2,175,000
-----------------
5,672,500
-----------------
Health Care-5.7% ALPHARMA, Cl. A.............................. 210,000 2,992,500
Algos Pharmaceutical......................... 185,000 (a) 2,081,250
Columbia/HCA Healthcare...................... 160,000 6,520,000
Fuisz Technologies........................... 30,000 (a) 236,250
ONCOR........................................ 250,000 (a) 984,375
-----------------
12,814,375
-----------------
Insurance-.5% CapMAC Holdings.............................. 35,500 1,175,938
-----------------
Media/Entertainment-14.3% Comcast, Cl. A............................... 250,000 4,453,125
Gannett...................................... 100,000 7,487,500
Groupe AB, A.D.S. ........................... 250,000 (a) 3,593,750
International Game Technology................ 300,000 5,475,000
Time Warner.................................. 150,000 5,625,000
Viacom, Cl. B................................ 165,000 (a) 5,754,375
-----------------
32,388,750
-----------------
Mining and Metals-2.7% Barrick Gold................................. 100,000 2,875,000
Brascan...................................... 150,000 3,318,750
-----------------
6,193,750
-----------------
Real Estate-6.2% Arden Realty................................. 100,000 2,775,000
Franchise Finance Corporation of America 175,000 4,834,375
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1996
Common Stocks (continued) Shares Value
-------------- --------------
Real Estate (continued) Merry Land & Investment....................... 300,000 $ 6,450,000
--------------
14,059,375
--------------
Technology-8.8% Atmel......................................... 75,000 (a) 2,484,375
Computer Sciences............................. 65,000 (a) 5,338,125
Electronic Data Systems....................... 100,000 4,325,000
First Data.................................... 60,000 2,190,000
Informix...................................... 150,000 (a) 3,056,250
LSI Logic..................................... 50,000 (a) 1,337,500
Vanstar....................................... 50,000 (a) 1,225,000
--------------
19,956,250
--------------
Telecommunications-4.4% GTE........................................... 75,000 3,412,500
SBC Communications............................ 75,000 3,881,250
Viatel........................................ 300,000 (a) 2,700,000
--------------
9,993,750
--------------
Utilities-1.8% Texas Utilities............................... 100,000 4,075,000
--------------
TOTAL COMMON STOCKS
(cost $159,081,757).......................... $161,312,263
===============
Convertible Preferred Stocks-4.7%
Media/Entertainment-1.1%. Station Casinos, 7%........................... 50,000 $ 2,393,750
---------------
Telecommunications-3.6% AirTouch Communications, Ser. C, 4.25%........ 110,000 4,977,500
MFS Communications, 8%......................... 35,000 3,193,750
---------------
8,171,250
---------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(cost $9,889,281)............................ $ 10,565,000
===============
Preferred Stocks-1.2%
Media/Entertainment;News Corp, A.D.S., Cum., $.40
(cost $3,025,373)............................ 150,000 $ 2,643,750
============
Principal
Convertible Corporate Notes & Bonds-9.4% Amount
-------------
Consumer-5.3% Home Depot, Sub. Notes,
3.25%, 10/1/2001............................. $ 5,000,000 $ 4,893,750
Omnicom Group, Sub. Deb.,
4.25%, 1/3/2007.............................. 1,800,000 (b) 1,836,000
Pep Boys, Sub. Notes,
Zero Coupon, 9/20/2011....................... 4,000,000 2,090,000
Staples, Sub. Deb.,
4.50%, 10/1/2000............................. 3,000,000 (b) 3,105,000
--------------
11,924,750
--------------
Health Care-.6% Complete Management, Sub. Deb.,
8%, 8/15/2003................................ 1,300,000 1,369,875
--------------
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1996
Principal
Convertible Corporate Notes & Bonds (continued) Amount Value
----------------- --------------
Insurance-.9% Penn Treaty American, Sub. Notes,
6.25%, 12/3/2003............................ $ 2,000,000 (b) $ 2,140,000
------------
Technology-2.6% Thermo Electron, Euro Sub. Deb.,
4.25%, 1/1/2003............................. 5,000,000 (b) 5,900,000
------------
TOTAL CONVERTIBLE CORPORATE NOTES & BONDS
(cost $21,441,811).......................... $ 21,334,625
============
U.S. Treasury Notes-3.1%
5.625%, 11/30/1998
(cost $6,977,162)........................... $ 7,000,000 $ 6,969,922
============
Short-Term Investments-10.4%
U.S. Treasury Bills: 5.36%, 1/16/1997............................. $ 213,000 $ 212,561
5.13%, 2/20/1997............................. 738,000 732,923
5.03%, 2/27/1997............................. 245,000 243,079
4.98%, 3/6/1997.......................... 19,530,000 19,357,745
5.30%, 3/13/1997......................... 3,038,000 3,008,258
--------------
TOTAL SHORT -TERM INVESTMENTS
(cost $23,557,186)...................... $ 23,554,566
==============
TOTAL INVESTMENTS (cost $223,972,570).......................................... 100.2% $226,380,126
======== ==============
LIABILITIES, LESS CASH AND RECEIVABLES......................................... (.2%) $ (445,156)
======== ==============
NET ASSETS..................................................................... 100.0% $225,934,970
======== ==============
Notes to Statement of Investments:
(a) Non-income producing.
(b) Securities exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At December 31, 1996, these securities amounted to $12,981,000 or
approximately 5.7% of net assets.
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 1996
Cost Value
-------------- ------------
<S> <C> <C> <C>
ASSETS: Investments in securities-See Statement of Investments $223,972,570 $226,380,126
Receivable for investment securities sold.. 9,953,436
Dividends and interest receivable.......... 686,771
Prepaid expenses........................... 163
------------
237,020,496
------------
LIABILITIES: Due to The Dreyfus Corporation and affiliates 147,717
Cash overdraft due to Custodian............ 1,050,880
Payable for investment securities purchased 9,824,406
Accrued expenses........................... 62,523
------------
11,085,526
------------
NET ASSETS.................................................................. $225,934,970
============
REPRESENTED BY: Paid-in capital............................ $221,552,145
Accumulated undistributed investment income-net 181,456
Accumulated net realized gain (loss) on investments 1,793,813
Accumulated net unrealized appreciation (depreciation)
on investments-Note 5 2,407,556
------------
NET ASSETS.................................................................. $225,934,970
============
SHARES OUTSTANDING
(UNLIMITED NUMBER OF $.001 PAR VALUE SHARES OF BENEFICIAL INTEREST AUTHORIZED) 11,556,263
NET ASSET VALUE, offering and redemption price per share.................... $19.55
=======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1996
<S> <C> <C> <C>
INVESTMENT INCOME
INCOME: Cash dividends (net of $11,596 foreign taxes
withheld at source).................... $ 2,438,905
Interest................................... 1,796,050
-----------
Total Income........................... $ 4,234,955
EXPENSES: Investment advisory fee-Note 4(a).......... 1,135,998
Registration fees.......................... 47,541
Professional fees.......................... 40,562
Custodian fees-Note 4(a)................... 21,875
Prospectus and shareholders' reports....... 5,741
Trustees' fees and expenses-Note 4(b)...... 5,433
Shareholder servicing costs................ 1,730
Miscellaneous.............................. 2,019
-----------
Total Expenses......................... 1,260,899
-----------
INVESTMENT INCOME-NET....................................................... 2,974,056
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS-Note 5:
Net realized gain (loss) on investments.... $22,639,509
Net unrealized appreciation (depreciation) on investments (2,605,907)
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS...................... 20,033,602
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $23,007,658
===========
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
December 31, 1996 December 31, 1995
----------------- -----------------
<S> <C> <C>
OPERATIONS:
Investment income-net.......................................... $ 2,974,056 $ 572,821
Net realized gain (loss) on investments........................ 22,639,509 4,082,523
Net unrealized appreciation (depreciation) on investments...... (2,605,907) 5,056,480
----------------- -----------------
Net Increase (Decrease) in Net Assets Resulting from Operations 23,007,658 9,711,824
----------------- -----------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net.......................................... (2,817,457) (548,022)
Net realized gain on investments............................... (22,301,456) (2,627,285)
----------------- -----------------
Total Dividends.............................................. (25,118,913) (3,175,307)
----------------- -----------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold.................................. 142,396,273 71,235,254
Dividends reinvested........................................... 25,118,913 3,175,307
Cost of shares redeemed........................................ (10,630,121) (10,825,812)
----------------- -----------------
Increase (Decrease) in Net Assets from Beneficial Interest Transactions 156,885,065 63,584,749
Total Increase (Decrease) in Net Assets.................... 154,773,810 70,121,266
NET ASSETS:
Beginning of Period............................................ 71,161,160 1,039,894
----------------- -----------------
End of Period.................................................. $225,934,970 $ 71,161,160
================= =================
UNDISTRIBUTED INVESTMENT INCOME-NET.............................. $ 181,456 $ 24,857
----------------- -----------------
Shares Shares
----------------- -----------------
CAPITAL SHARE TRANSACTIONS:
Shares sold.................................................... 6,920,188 4,269,435
Shares issued for dividends reinvested......................... 1,271,395 179,268
Shares redeemed................................................ (518,058) (652,787)
----------------- -----------------
Net Increase (Decrease) in Shares Outstanding................ 7,673,525 3,795,916
================= =================
See notes to financial statements.
</TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each period indicated. This
information has been derived from the Series' financial statements.
<TABLE>
Year Ended December 31,
--------------------------------------
PER SHARE DATA: 1996 1995 1994(1)
-------- ---------- ----------
<S> <C> <C> <C>
Net asset value, beginning of period.................................. $18.33 $11.98 $12.50
-------- ---------- ----------
Investment Operations:
Investment income-net................................................. .36 .28 .28
Net realized and unrealized gain (loss)
on investments...................................................... 3.43 7.07 (.43)
-------- ---------- ----------
Total from Investment Operations...................................... 3.79 7.35 (.15)
-------- ---------- ----------
Distributions:
Dividends from investment income-net.................................. (.35) (.27) (.28)
Dividends from net realized gain on investments....................... (2.22) (.73) (.09)
-------- ---------- ----------
Total Distributions................................................... (2.57) (1.00) (.37)
-------- ---------- ----------
Net asset value, end of period........................................ $19.55 $18.33 $11.98
======== =========== =========
TOTAL INVESTMENT RETURN................................................... 20.75% 61.89% (1.22%)(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets............................... .83% .92% .22%(2)
Ratio of net investment income
to average net assets............................................... 1.96% 2.21% 2.25%(2)
Decrease reflected in above expense ratios
due to undertakings by The Dreyfus Corporation...................... -- .03% 1.28%(2)
Portfolio Turnover Rate............................................... 237.44% 255.42% 237.09%(2)
Average commission rate paid (3)...................................... $.1904 -- --
Net Assets, end of period (000's Omitted)............................. $225,935 $71,161 $1,040
(1)From May 2, 1994 (commencement of operations) to December 31, 1994.
(2)Not annualized.
(3)For fiscal years beginning January 1, 1996, the Series is required to disclose its average commission rate paid per share
for purchases and sales of investment securities.
See notes to financial statements.
</TABLE>
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
NOTE 1-General:
Dreyfus Variable Investment Fund (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as an open-end management investment
company, operating as a series company, currently offering eleven series,
including the Growth and Income Portfolio (the "Series") and is intended to
be a funding vehicle for variable annuity contracts and variable life
insurance policies to be offered by the separate accounts of life insurance
companies. The Series is a non-diversified portfolio. The Series' investment
objective is to provide long-term capital growth, current income and growth
of income, consistent with reasonable investment risk. The Dreyfus
Corporation ("Dreyfus") serves as the Series' investment adviser. Dreyfus is
a direct subsidiary of Mellon Bank, N.A. ("Mellon"). Premier Mutual Fund
Services, Inc. acts as the distributor of the Series' shares, which are sold
without a sales charge.
The Fund accounts separately for the assets, liabilities and operations
of each series. Expenses directly attributable to each series are charged to
that series' operations; expenses which are applicable to all series are
allocated among them on a pro rata basis.
The Series' financial statements are prepared in accordance with
generally accepted accounting principles which may require the use of
management estimates and assumptions. Actual results could differ from those
estimates.
NOTE 2-Significant Accounting Policies:
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Securities for which there are no such valuations are valued at fair value as
determined in good faith under the direction of the Board of Trustees.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange. Forward currency exchange contracts are
valued at the forward rate.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. The Series declares and pays dividends from investment income-net on a
quarterly basis. Dividends from net realized capital gain are normally
declared and paid annually, but the Series may make distributions on a more
frequent basis to comply with the distribution requirements of the Internal
Revenue Code. To the extent that net realized capital gain can be offset by
capital loss carryovers, if any, it is the policy of the Series not to
distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Series to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 3-Bank Line of Credit:
The Series participates with other Dreyfus-managed funds in a $100
million unsecured line of credit primarily to be utilized for temporary or
emergency purposes, including the financing of redemptions. Interest is
charged to the Series at rates which are related to the Federal Funds rate in
effect at the time of borrowings. For the period ended December 31, 1996, the
Series did not borrow under the line of credit.
NOTE 4-Investment Advisory Fee and Other Transactions With Affiliates:
(A) Pursuant to an Investment Advisory Agreement ("Agreement") with
Dreyfus, the investment advisory fee is computed at the annual rate of .75 of
1% of the value of the Series' average daily net assets and is payable
monthly.
The Series compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary
of Dreyfus, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Series.
Effective May 10, 1996, the Series entered into a custody agreement with
Mellon to provide custodial services for the Series. During the period ended
December 31, 1996, $14,193 was charged by Mellon pursuant to the custody
agreement.
(B) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 5-Securities Transactions:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the period ended December 31, 1996,
amounted to $424,524,602 and $307,781,021, respectively.
At December 31, 1996, accumulated net unrealized appreciation on
investments was $2,407,556, consisting of $10,461,470 gross unrealized
appreciation and $8,053,914 gross unrealized depreciation.
At December 31, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME PORTFOLIO
We have audited the accompanying statement of assets and liabilities,
including the statement of investments, of Dreyfus Variable Investment Fund,
Growth and Income Portfolio (one of the series constituting the Dreyfus
Variable Investment Fund) as of December 31, 1996, and the related statement
of operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and financial highlights
for each of the years indicated therein. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights 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 and
financial highlights 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 verification by
examination of securities held by the custodian as of December 31, 1996 and
confirmation of securities not held by the custodian by correspondence with
others. 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, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus Variable Investment Fund, Growth and Income Portfolio at
December 31, 1996, the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period then ended,
and the financial highlights for each of the indicated years, in conformity
with generally accepted accounting principles.
(Ernst & Young LLP signature)
New York, New York
January 29, 1997
(Dreyfus lion "d" logo)
Dreyfus Variable Investment Fund,
Growth and Income Portfolio
200 PARK AVENUE
NEW YORK, NY 10166
Investment Adviser
THE DREYFUS CORPORATION
200 PARK AVENUE
NEW YORK, NY 10166
Custodian
MELLON BANK, N.A.
ONE MELLON BANK CENTER
PITTSBURGH, PA 15258
Transfer Agent &
Dividend Disbursing Agent
DREYFUS TRANSFER, INC.
P.O. BOX 9671
PROVIDENCE, RI 02940
PRINTED IN U.S.A. 108AR9612
(Dreyfus Logo)
VARIABLE
INVESTMENT FUND,
GROWTH AND INCOME
PORTFOLIO
ANNUAL REPORT
DECEMBER 31, 1996
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN DREYFUS VARIABLE INVESTMENT FUND, GROWTH AND INCOME
PORTFOLIO AND THE STANDARD & POOR'S 500 COMPOSITE STOCK
PRICE INDEX
EXHIBIT A:
DREYFUS
STANDARD VARIABLE
& POOR'S 500 INVESTMENT FUND,
COMPOSITE STOCK GROWTH AND INCOME
PERIOD PRICE INDEX* PORTFOLIO
5/2/94 10,000 10,000
12/31/94 10,397 9,878
12/31/95 14,299 15,992
12/31/96 17,580 19,311
*Source: Lipper Analytical Services, Inc.
