LIFE OF VIRGINIA SEPARATE ACCOUNT 4
FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1998
(WITH INDEPENDENT AUDITORS' REPORT THEREON)
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
TABLE OF CONTENTS
YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Independent Auditors' Report ................... A-3
Financial Statements:
Statements of Assets and Liabilities .......... A-4
Statements of Operations ...................... A-11
Statements of Changes in Net Assets ........... A-22
Notes to Financial Statements .................. A-43
</TABLE>
A-2
<PAGE>
INDEPENDENT AUDITORS' REPORT
Contractholders
Life of Virginia Separate Account 4
and
The Board of Directors
The Life Insurance Company of Virginia:
We have audited the accompanying statements of assets and liabilities of
Life of Virginia Separate Account 4 (the Account) (comprising the GE
Investments Funds, Inc. -- S&P 500 Index, Money Market, Total Return,
International Equity, Real Estate Securities, Global Income, Value Equity,
Income and U.S. Equity Funds; the Oppenheimer Variable Account Funds -- Bond,
Capital Appreciation, Growth, High Income and Multiple Strategies Funds; the
Variable Insurance Products Fund -- Equity-Income, Growth and Overseas
Portfolios; the Variable Insurance Products Fund II -- Asset Manager and
Contrafund Portfolios; the Variable Insurance Products Fund III -- Growth &
Income and Growth Opportunities Portfolios; the Federated Investors Insurance
Series -- American Leaders, High Income Bond and Utility Funds II; the Alger
American Fund -- Small Cap and Growth Portfolios; the PBHG Insurance Series
Fund -- PBHG Large Cap Growth and PBHG Growth II Portfolios; the Janus Aspen
Series -- Aggressive Growth, Growth, Worldwide Growth, Balanced, Flexible
Income, International Growth and Capital Appreciation Portfolios; the Goldman
Sachs Variable Insurance Trust Fund -- Growth and Income and Mid Cap Equity
Funds; and the Salomon Brothers Variable Series Fund -- Strategic Bond,
Investors, and Total Return Funds) as of December 31, 1998 and the related
statements of operations and changes in net assets for the aforementioned funds
and the GE Investments Funds Inc. Government Securities Fund; Oppenheimer
Variable Account Money Fund; Variable Insurance Products Funds -- Money Market
and High Income Portfolios; and Neuberger & Berman Advisers Management Trust --
Balanced, Bond and Growth Portfolios, of Life of Virginia Separate Account 4
for each of the years or lesser periods in the three year period then ended.
These financial statements are the responsibility of the Account's 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 owned as of December 31, 1998,
by correspondence with the underlying mutual funds or their transfer agent. 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 referred to above present fairly,
in all material respects, the financial position of each of the respective
portfolios constituting Life of Virginia Separate Account 4 as of December 31,
1998 and the results of their operations and changes in their net assets for
each of the years or lesser periods in the three year period then ended in
conformity with generally accepted accounting principles.
KPMG LLP
Richmond, Virginia
February 12, 1999
A-3
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC.
----------------------------------
S&P 500 MONEY
INDEX MARKET
FUND FUND
ASSETS ----------------- ----------------
<S> <C> <C>
Investment in GE Investments Funds, Inc.,
at fair value (note 2):
S&P 500 Index Fund (12,978,221 shares;
cost -- $264,318,648)................................ $307,713,611 --
Money Market Fund (206,691,464 shares;
cost -- $206,691,474)................................ -- 206,691,464
Total Return Fund (4,513,480 shares;
cost -- $64,971,588)................................. -- --
International Equity Fund (2,342,088; shares;
cost -- $27,101,105)................................. -- --
Real Estate Securities Fund (4,024,961
shares; cost -- $55,753,342)......................... -- --
Global Income Fund (942,716 shares;
cost -- $9,713,591).................................. -- --
Value Equity Fund (2,887,264 shares;
cost -- $38,586,474)................................. -- --
Income Fund (2,792,519 shares;
cost -- $34,717,370)................................. -- --
U.S. Equity Fund (63,724 shares;
cost -- $1,980,988).................................. -- --
Receivable from affiliate .............................. -- 20,944
Receivable for units sold .............................. 1,603,821 12,193,795
------------ -----------
TOTAL ASSETS ........................................ 309,317,432 218,906,203
------------ -----------
LIABILITIES
Accrued expenses payable to affiliate (note 3) ......... 490,032 369,262
Payable for units withdrawn: ........................... -- --
------------ -----------
TOTAL LIABILITIES ................................... 490,032 369,262
------------ -----------
Net assets ............................................. $308,827,400 218,536,941
============ ===========
Analysis of net assets:
Attributable to:
Variable deferred annuity contractholders ........... $308,827,400 218,536,941
The Life Insurance Company of Virginia .............. -- --
------------ -----------
Net assets ............................................. $308,827,400 218,536,941
============ ===========
Outstanding units attributable to
contractholders: Type I (note 2) ...................... 1,096,813 5,222,349
============ ===========
Net asset value per unit: Type I ....................... $ 50.24 15.38
============ ============
Outstanding units attributable to
contractholders: Type II (note 2) ..................... 5,187,559 9,232,947
============ ============
Net asset value per unit: Type II ...................... $ 48.91 14.97
============ ============
<CAPTION>
GE INVESTMENTS FUNDS, INC.
-----------------------------------------------
TOTAL INTERNATIONAL REAL ESTATE
RETURN EQUITY SECURITIES
FUND FUND FUND
ASSETS --------------- --------------- ---------------
<S> <C> <C> <C>
Investment in GE Investments Funds, Inc.,
at fair value (note 2):
S&P 500 Index Fund (12,978,221 shares;
cost -- $264,318,648)................................ -- -- --
Money Market Fund (206,691,464 shares;
cost -- $206,691,474)................................ -- -- --
Total Return Fund (4,513,480 shares;
cost -- $64,971,588)................................. $66,167,622 -- --
International Equity Fund (2,342,088; shares;
cost -- $27,101,105)................................. -- 27,847,422 --
Real Estate Securities Fund (4,024,961
shares; cost -- $55,753,342)......................... -- -- 46,649,298
Global Income Fund (942,716 shares;
cost -- $9,713,591).................................. -- -- --
Value Equity Fund (2,887,264 shares;
cost -- $38,586,474)................................. -- -- --
Income Fund (2,792,519 shares;
cost -- $34,717,370)................................. -- -- --
U.S. Equity Fund (63,724 shares;
cost -- $1,980,988).................................. -- -- --
Receivable from affiliate .............................. -- -- --
Receivable for units sold .............................. 34,871 -- --
---------- ---------- ----------
TOTAL ASSETS ........................................ 66,202,493 27,847,422 46,649,298
---------- ---------- ----------
LIABILITIES
Accrued expenses payable to affiliate (note 3) ......... 91,900 23,042 46,746
Payable for units withdrawn: ........................... 2,249 1,004,629 57,007
---------- ---------- ----------
TOTAL LIABILITIES ................................... 94,149 1,027,671 103,753
---------- ---------- ----------
Net assets ............................................. $66,108,344 26,819,751 46,545,545
========== ========== ==========
Analysis of net assets:
Attributable to:
Variable deferred annuity contractholders ........... $66,108,344 11,643,666 30,866,087
The Life Insurance Company of Virginia .............. -- 15,176,085 15,679,458
---------- ---------- ----------
Net assets ............................................. $66,108,344 26,819,751 46,545,545
========== ========== ==========
Outstanding units attributable to
contractholders: Type I (note 2) ...................... 584,911 161,533 316,692
========== ========== ==========
Net asset value per unit: Type I ....................... $ 33.52 14.54 15.02
=========== =========== ===========
Outstanding units attributable to
contractholders: Type II (note 2) ..................... 1,425,134 641,918 1,753,483
=========== =========== ===========
Net asset value per unit: Type II ...................... $ 32.63 14.48 14.89
=========== =========== ===========
</TABLE>
A-4
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
--------------------------------------------------------------
GLOBAL VALUE U.S.
INCOME EQUITY INCOME EQUITY
FUND FUND FUND FUND
ASSETS --------------- --------------- --------------- --------------
<S> <C> <C> <C> <C>
Investment in GE Investments Funds, Inc., at fair value
(note 2):
S&P 500 Index Fund (12,978,221 shares;
cost -- $264,318,648)...................................... -- -- -- --
Money Market Fund (206,691,464 shares;
cost -- $206,691,474)...................................... -- -- -- --
Total Return Fund (4,513,480 shares;
cost -- $64,971,588)....................................... -- -- -- --
International Equity Fund (2,342,088; shares;
cost -- $27,101,105)....................................... -- -- -- --
Real Estate Securities Fund (4,024,961 shares;
cost-- $55,753,342)........................................ -- -- -- --
Global Income Fund (942,716 shares;
cost -- $9,713,591)........................................ $ 9,926,798 -- -- --
Value Equity Fund (2,887,264 shares;
cost -- $38,586,474)....................................... -- 39,180,175 -- --
Income Fund (2,792,519 shares; cost -- $34,717,370).......... -- -- 34,459,679 --
U.S. Equity Fund (63,724 shares; cost -- $1,980,988)......... -- -- -- 2,134,742
Receivable from affiliate .................................... -- -- -- --
Receivable for units sold .................................... -- 23,889 1,316 74,672
----------- ---------- ---------- ---------
TOTAL ASSETS .............................................. 9,926,798 39,204,064 34,460,995 2,209,414
----------- ---------- ---------- ---------
LIABILITIES
Accrued expenses payable to affiliate (note 3) ............... 6,646 62,695 129,260 8,434
Payable for units withdrawn: ................................. 249,428 230 7,758 --
----------- ---------- ---------- ---------
TOTAL LIABILITIES ......................................... 256,074 62,925 137,018 8,434
----------- ---------- ---------- ---------
Net assets ................................................... $ 9,670,724 39,141,139 34,323,977 2,200,980
=========== ========== ========== =========
Analysis of net assets:
Attributable to:
Variable deferred annuity contractholders ................. $ 3,810,911 34,898,557 34,323,977 2,200,980
The Life Insurance Company of Virginia .................... 5,859,813 4,242,582 -- --
----------- ---------- ---------- ---------
Net assets ................................................... $ 9,670,724 39,141,139 34,323,977 2,200,980
=========== ========== ========== =========
Outstanding units attributable to contractholders:
Type I (note 2) ............................................. 46,632 385,376 1,332,645 26,127
=========== ========== ========== =========
Net asset value per unit: Type I ............................. $ 11.50 13.87 10.68 10.68
=========== =========== =========== ==========
Outstanding units attributable to contractholders:
Type II (note 2) ............................................ 285,995 2,140,000 1,884,740 180,295
=========== =========== =========== ==========
Net asset value per unit: Type II ............................ $ 11.45 13.81 10.66 10.66
=========== =========== =========== ==========
</TABLE>
A-5
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
----------------------------------
CAPITAL
BOND APPRECIATION
FUND FUND
ASSETS ---------------- ----------------
<S> <C> <C>
Investment in Oppenheimer Variable
Account Funds, at fair value (note 2):
Bond Fund (5,079,562 shares;
cost -- $60,266,701) $ 62,580,210 --
Capital Appreciation Fund (4,869,166 shares;
cost -- $187,683,640).......................... -- 218,284,700
Growth Fund (5,178,151 shares;
cost -- $165,665,597).......................... -- --
High Income Fund (14,906,183 shares;
cost -- $166,811,528).......................... -- --
Multiple Strategies Fund (4,689,609 shares;
cost -- $71,277,962)........................... -- --
Receivable for units sold ....................... 276,761 407,058
------------ -----------
TOTAL ASSETS .................................. 62,856,971 218,691,758
------------ -----------
LIABILITIES
Increase (decrease) in net assets from capital
transactions .................................... 110,911 425,350
Payable for units withdrawn ...................... -- 239,701
------------ -----------
TOTAL LIABILITIES ............................. 110,911 665,051
------------ -----------
Net assets attributable to variable deferred
annuity contractholders ......................... $ 62,746,060 218,026,707
============ ===========
Outstanding units: Type I (note 2) ............... 915,859 2,344,528
============ ===========
Net asset value per unit: Type I ................. $ 22.09 40.56
============ ============
Outstanding units: Type II (note 2) .............. 1,976,510 3,113,007
============ ============
Net asset value per unit: Type II ................ $ 21.51 39.49
============ ============
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
-------------------------------------------------
HIGH MULTIPLE
GROWTH INCOME STRATEGIES
FUND FUND FUND
ASSETS ---------------- ---------------- ---------------
<S> <C> <C> <C>
Investment in Oppenheimer Variable
Account Funds, at fair value (note 2):
Bond Fund (5,079,562 shares;
cost -- $60,266,701) -- -- --
Capital Appreciation Fund (4,869,166 shares;
cost -- $187,683,640).......................... -- -- --
Growth Fund (5,178,151 shares;
cost -- $165,665,597).......................... $189,882,808 -- --
High Income Fund (14,906,183 shares;
cost -- $166,811,528).......................... -- 164,266,132 --
Multiple Strategies Fund (4,689,609 shares;
cost -- $71,277,962)........................... -- -- 79,957,841
Receivable for units sold ....................... -- 55,163 --
----------- ----------- ----------
TOTAL ASSETS .................................. 189,882,808 164,321,295 79,957,841
----------- ----------- ----------
LIABILITIES
Increase (decrease) in net assets from capital
transactions .................................... 310,016 235,959 194,658
Payable for units withdrawn ...................... 206,098 80,754 8,622
----------- ----------- ----------
TOTAL LIABILITIES ............................. 516,114 316,713 203,280
----------- ----------- ----------
Net assets attributable to variable deferred
annuity contractholders ......................... $189,366,694 164,004,582 79,754,561
=========== =========== ==========
Outstanding units: Type I (note 2) ............... 1,173,060 1,658,434 1,344,466
=========== =========== ==========
Net asset value per unit: Type I ................. $ 46.11 31.06 27.87
============ ============ ===========
Outstanding units: Type II (note 2) .............. 3,012,849 3,720,027 1,558,580
============ ============ ===========
Net asset value per unit: Type II ................ $ 44.90 30.24 27.13
============ ============ ===========
</TABLE>
A-6
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE
PRODUCTS FUNDS
---------------------------------------------------
EQUITY-
INCOME GROWTH OVERSEAS
PORTFOLIO PORTFOLIO PORTFOLIO
ASSETS ----------------- ---------------- ----------------
<S> <C> <C> <C>
Investment in Variable Insurance
Products Fund, at fair value
(note 2):
Equity -- Income Portfolio
(27,318,250 shares;
cost -- $571,169,732)..................... $ 694,429,927 -- --
Growth Portfolio (9,326,267 shares;
cost -- $283,201,407)..................... -- 418,469,590 --
Overseas Portfolio (5,683,460
shares; cost -- $108,549,287)............. -- -- 113,953,371
Investment in Variable Insurance
Products Fund II, at fair value
(note 2):
Asset Manager Portfolio
(27,620,799 shares;
cost -- $415,474,554)..................... -- -- --
Contrafund Portfolio (14,085,035
shares; cost -- $248,124,557)............. -- -- --
Investment in Variable Insurance
Products Fund III, at fair value
(note 2):
Growth & Income Portfolio
(3,513,229 shares;
cost -- $48,367,818)...................... -- -- --
Growth Opportunities Portfolio
(2,333,781 shares; cost --
$45,525,614).............................. -- -- --
Receivable for units sold .................. -- 3,264 107,222
------------- ----------- -----------
TOTAL ASSETS ............................. 694,429,927 418,472,854 114,060,593
------------- ----------- -----------
LIABILITIES
Accrued expenses payable to affiliate
(note 3) .................................. 971,345 674,619 336,549
Payable for units withdrawn ................ 1,226,255 231,503 10,260,769
------------- ----------- -----------
TOTAL LIABILITIES ........................ 2,197,600 906,122 10,597,318
------------- ----------- -----------
Net assets attributable to variable
deferred annuity contractholders .......... $ 692,232,327 417,566,732 103,463,275
============= =========== ===========
Outstanding units: Type I (note 2) ......... 5,753,760 3,969,421 2,813,314
============= =========== ===========
Net asset value per unit: Type I ........... $ 41.23 54.32 23.58
============= ============ ============
Outstanding units: Type II (note 2) ........ 11,335,446 3,818,261 1,616,956
============= ============ ============
Net asset value per unit: Type II .......... $ 40.14 52.89 22.96
============= ============ ============
<CAPTION>
VARIABLE INSURANCE VARIABLE INSURANCE
PRODUCTS FUND II PRODUCTS FUND III
--------------------------------- ------------------------------
ASSET GROWTH & GROWTH
MANAGER CONTRAFUND INCOME OPPORTUNITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
ASSETS ---------------- ---------------- --------------- --------------
<S> <C> <C> <C> <C>
Investment in Variable Insurance
Products Fund, at fair value
(note 2):
Equity -- Income Portfolio
(27,318,250 shares;
cost -- $571,169,732)..................... -- -- -- --
Growth Portfolio (9,326,267 shares;
cost -- $283,201,407)..................... -- -- -- --
Overseas Portfolio (5,683,460
shares; cost -- $108,549,287)............. -- -- -- --
Investment in Variable Insurance
Products Fund II, at fair value
(note 2):
Asset Manager Portfolio
(27,620,799 shares;
cost -- $415,474,554)..................... $501,593,704 -- -- --
Contrafund Portfolio (14,085,035
shares; cost -- $248,124,557)............. -- 344,238,254 -- --
Investment in Variable Insurance
Products Fund III, at fair value
(note 2):
Growth & Income Portfolio
(3,513,229 shares;
cost -- $48,367,818)...................... -- -- 56,738,647 --
Growth Opportunities Portfolio
(2,333,781 shares; cost --
$45,525,614).............................. -- -- -- 53,396,906
Receivable for units sold .................. -- 20,128 207,349 320,250
----------- ----------- ---------- ----------
TOTAL ASSETS ............................. 501,593,704 344,258,382 56,945,996 53,717,156
----------- ----------- ---------- ----------
LIABILITIES
Accrued expenses payable to affiliate
(note 3) .................................. 758,448 481,460 98,413 73,997
Payable for units withdrawn ................ 348,104 52,956 -- 7,101
----------- ----------- ---------- ----------
TOTAL LIABILITIES ........................ 1,106,552 534,416 98,413 81,098
----------- ----------- ---------- ----------
Net assets attributable to variable
deferred annuity contractholders .......... $500,487,152 343,723,966 56,847,583 53,636,058
=========== =========== ========== ==========
Outstanding units: Type I (note 2) ......... 14,835,158 3,082,088 751,280 595,214
=========== =========== ========== ==========
Net asset value per unit: Type I ........... $ 27.90 26.31 15.86 15.15
============ ============ =========== ===========
Outstanding units: Type II (note 2) ........ 3,176,311 10,085,800 2,843,815 2,958,791
============ ============ =========== ===========
Net asset value per unit: Type II .......... $ 27.26 26.04 15.80 15.08
============ ============ =========== ===========
</TABLE>
A-7
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEDERATED INVESTORS
INSURANCE SERIES
------------------------------------------------
AMERICAN HIGH
LEADERS INCOME BOND UTILITY
FUND II FUND II FUND II
---------------- --------------- ---------------
<S> <C> <C> <C>
ASSETS
Investments in Federated Investors
Insurance Series, at fair value (note 2):
American Leaders Fund II (3,423,504
shares; cost -- $66,654,672).................. $ 74,221,563 -- --
High Income Bond Fund II (4,748,355
shares; cost -- $50,760,691).................. -- 51,852,041 --
Utility Fund II (3,001,202 shares;
cost -- $38,293,472).......................... -- -- 45,828,348
Investment in Alger American Fund, at
fair value (note 2):
Small Cap Portfolio (2,156,235 shares;
cost -- $88,492,185).......................... -- -- --
Growth Portfolio (2,467,326 shares;
cost -- $100,555,548)......................... -- -- --
PBHG Insurance Series Fund, at fair
value (note 2):
PBHG Large Cap Growth Portfolio
(778,422 shares; cost -- $9,843,865).......... -- -- --
PBHG Growth II Portfolio (942,049
shares; cost -- $10,016,297).................. -- -- --
Receivable for units sold ...................... 105,458 691,832 50,673
------------ ---------- ----------
TOTAL ASSETS ................................. 74,327,021 52,543,873 45,879,021
------------ ---------- ----------
LIABILITIES
Accrued expenses payable to affiliate
(note 3) ...................................... 111,393 77,244 65,560
Payable for units withdrawn .................... 403 -- 1,616
------------ ---------- ----------
TOTAL LIABILITIES ............................ 111,796 77,244 67,176
------------ ---------- ----------
Net assets attributable to variable deferred
annuity contractholders ....................... $ 74,215,225 52,466,629 45,811,845
============ ========== ==========
Outstanding units: Type I (note 2) ............. 480,466 471,675 478,465
============ ========== ==========
Net asset value per unit: Type I ............... $ 16.83 15.34 19.01
============ =========== ===========
Outstanding units: Type II (note 2) ............ 3,955,083 2,977,691 1,950,915
============ =========== ===========
Net asset value per unit: Type II .............. $ 16.72 15.19 18.82
============ =========== ===========
<CAPTION>
ALGER AMERICAN PBHG INSURANCE
FUND SERIES FUND
-------------------------------- -------------------------------
SMALL PBHG LARGE PBHG
CAP GROWTH CAP GROWTH GROWTH II
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ---------------- --------------- ---------------
<S> <C> <C> <C> <C>
ASSETS
Investments in Federated Investors
Insurance Series, at fair value (note 2):
American Leaders Fund II (3,423,504
shares; cost -- $66,654,672).................. -- -- -- --
High Income Bond Fund II (4,748,355
shares; cost -- $50,760,691).................. -- -- -- --
Utility Fund II (3,001,202 shares;
cost -- $38,293,472).......................... -- -- -- --
Investment in Alger American Fund, at
fair value (note 2):
Small Cap Portfolio (2,156,235 shares;
cost -- $88,492,185).......................... $94,809,637 -- -- --
Growth Portfolio (2,467,326 shares;
cost -- $100,555,548)......................... -- 131,311,079 -- --
PBHG Insurance Series Fund, at fair
value (note 2):
PBHG Large Cap Growth Portfolio
(778,422 shares; cost -- $9,843,865).......... -- -- 12,018,842 --
PBHG Growth II Portfolio (942,049
shares; cost -- $10,016,297).................. -- -- -- 10,956,027
Receivable for units sold ...................... -- 951,516 25,926 --
---------- ----------- ---------- ----------
TOTAL ASSETS ................................. 94,809,637 132,262,595 12,044,768 10,956,027
---------- ----------- ---------- ----------
LIABILITIES
Accrued expenses payable to affiliate
(note 3) ...................................... 130,000 261,324 42,299 16,704
Payable for units withdrawn .................... 325,378 -- 20,883 4,556
---------- ----------- ---------- ----------
TOTAL LIABILITIES ............................ 455,378 261,324 63,182 21,260
---------- ----------- ---------- ----------
Net assets attributable to variable deferred
annuity contractholders ....................... $94,354,259 132,001,271 11,981,586 10,934,767
========== =========== ========== ==========
Outstanding units: Type I (note 2) ............. 1,733,429 1,161,424 98,043 122,432
========== =========== ========== ==========
Net asset value per unit: Type I ............... $ 12.15 19.64 15.15 11.41
=========== ============ =========== ===========
Outstanding units: Type II (note 2) ............ 6,082,414 5,605,283 696,037 839,596
=========== ============ =========== ===========
Net asset value per unit: Type II .............. $ 12.05 19.48 15.08 11.36
=========== ============ =========== ===========
</TABLE>
A-8
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES
---------------------------------------------------
AGGRESSIVE WORLDWIDE
GROWTH GROWTH GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
ASSETS ----------------- ---------------- ----------------
<S> <C> <C> <C>
Investment in Janus Aspen Series,
at fair value (note 2):
Aggressive Growth Portfolio
(4,879,822 shares;
cost -- $94,938,397)................. $ 134,634,295 -- --
Growth Portfolio
(14,233,651 shares;
cost -- $231,936,881)................ -- 335,060,133 --
Worldwide Growth Portfolio
(17,569,116 shares;
cost -- $409,584,897)................ -- -- 511,085,584
Balanced Portfolio
(7,729,369 shares;
cost -- $140,195,868)................ -- -- --
Flexible Income Portfolio
(2,729,903 shares;
cost -- $32,556,570)................. -- -- --
International Growth Portfolio
(3,639,052 shares;
cost -- $74,093,952)................. -- -- --
Capital Appreciation Portfolio
(1,912,067 shares;
cost -- $30,581,552)................. -- -- --
Receivable for units sold ............. -- -- --
------------- ----------- -----------
TOTAL ASSETS ........................ 134,634,295 335,060,133 511,085,584
------------- ----------- -----------
LIABILITIES
Accrued expenses payable to
affiliate (note 3) ................... 211,955 647,926 762,785
Payable for units withdrawn ........... 142,845 27,385 1,506,463
------------- ----------- -----------
354,800 675,311 2,269,248
------------- ----------- -----------
Net assets attributable to variable
deferred annuity contractholders...... $ 134,279,495 334,384,822 508,816,336
============= =========== ===========
Outstanding units: Type I
(note 2) ............................. 1,551,670 4,307,429 4,894,747
============= =========== ===========
Net asset value per unit:
Type I ............................... $ 26.89 25.68 29.44
============= ============ ============
Outstanding units: Type II
(note 2) ............................. 3,488,695 8,827,221 12,554,733
============= ============ ============
Net asset value per unit:
Type II .............................. $ 26.53 25.35 29.05
============= ============ ============
<CAPTION>
JANUS ASPEN SERIES
----------------------------------------------------------------
FLEXIBLE INTERNATIONAL CAPITAL
BALANCED INCOME GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
ASSETS ---------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Investment in Janus Aspen Series,
at fair value (note 2):
Aggressive Growth Portfolio
(4,879,822 shares;
cost -- $94,938,397)................. -- -- -- --
Growth Portfolio
(14,233,651 shares;
cost -- $231,936,881)................ -- -- -- --
Worldwide Growth Portfolio
(17,569,116 shares;
cost -- $409,584,897)................ -- -- -- --
Balanced Portfolio
(7,729,369 shares;
cost -- $140,195,868)................ $173,910,792 -- -- --
Flexible Income Portfolio
(2,729,903 shares;
cost -- $32,556,570)................. -- 32,922,626 -- --
International Growth Portfolio
(3,639,052 shares;
cost -- $74,093,952)................. -- -- 77,402,638 --
Capital Appreciation Portfolio
(1,912,067 shares;
cost -- $30,581,552)................. -- -- -- 38,126,625
Receivable for units sold ............. 915,453 170,372 194,104 1,075,836
----------- ---------- ---------- ----------
TOTAL ASSETS ........................ 174,826,245 33,092,998 77,596,742 39,202,461
----------- ---------- ---------- ----------
LIABILITIES
Accrued expenses payable to
affiliate (note 3) ................... 250,096 47,653 115,569 118,990
Payable for units withdrawn ........... -- -- -- --
----------- ---------- ---------- ----------
250,096 47,653 115,569 118,990
----------- ---------- ---------- ----------
Net assets attributable to variable
deferred annuity contractholders...... $174,576,149 33,045,345 77,481,173 39,083,471
=========== ========== ========== ==========
Outstanding units: Type I
(note 2) ............................. 2,916,033 552,225 1,053,424 506,817
=========== ========== ========== ==========
Net asset value per unit:
Type I ............................... $ 19.55 13.50 15.86 19.59
============ =========== =========== ===========
Outstanding units: Type II
(note 2) ............................. 6,060,191 1,911,151 3,856,210 1,494,358
============ =========== =========== ===========
Net asset value per unit:
Type II .............................. $ 19.40 13.39 15.76 19.51
============ =========== =========== ===========
</TABLE>
A-9
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF ASSETS AND LIABILITIES, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GOLDMAN SACHS VARIABLE
INSURANCE TRUST FUND
------------------------------
GROWTH AND MID CAP
INCOME EQUITY
FUND FUND
--------------- --------------
<S> <C> <C>
ASSETS
Investment in Goldman Sachs Variable Insurance Trust Fund,
at fair value (note 2):
Growth and Income Fund (402,157 shares;
cost -- $4,162,464)......................................... $ 4,202,546 --
Mid Cap Equity Fund (428,996 shares;
cost -- $3,663,704)......................................... -- 3,676,492
Investment in Salomon Brothers
Variable Series Fund, at fair value (note 2):
Strategic Bond Fund (12,447 shares; cost -- $130,915)......... -- --
Investors Fund (994 shares; cost -- $10,626).................. -- --
Total Return Fund (32,491 shares; cost -- $340,870)........... -- --
Dividend receivable ........................................... -- --
Receivable from affiliate ..................................... 49,406 3,746
Receivable for units sold ..................................... 15,607 --
----------- ---------
TOTAL ASSETS ............................................... 4,267,559 3,680,238
----------- ---------
LIABILITIES
Accrued expenses payable to affiliate (note 3) ................ 4,991 48,760
Payable for units withdrawn ................................... -- 8,287
----------- ---------
TOTAL LIABILITIES .......................................... 4,991 57,047
----------- ---------
Net assets attributable to variable deferred annuity
contractholders .............................................. $ 4,262,568 3,623,191
=========== =========
Outstanding units: Type I (note 2) ............................ 52,650 78,049
=========== =========
Net asset value per unit: Type I .............................. $ 8.86 8.57
=========== ==========
Outstanding units: Type II (note 2) ........................... 428,936 345,533
=========== ==========
Net asset value per unit: Type II ............................. $ 8.85 8.55
=========== ==========
<CAPTION>
SALOMON BROTHERS
VARIABLE SERIES FUND
-----------------------------------
STRATEGIC TOTAL
BOND INVESTOR RETURN
FUND FUND FUND
----------- ---------- ------------
<S> <C> <C> <C>
ASSETS
Investment in Goldman Sachs Variable Insurance Trust Fund,
at fair value (note 2):
Growth and Income Fund (402,157 shares;
cost -- $4,162,464)......................................... -- -- --
Mid Cap Equity Fund (428,996 shares;
cost -- $3,663,704)......................................... -- -- --
Investment in Salomon Brothers
Variable Series Fund, at fair value (note 2):
Strategic Bond Fund (12,447 shares; cost -- $130,915)......... $126,092 -- --
Investors Fund (994 shares; cost -- $10,626).................. -- 10,947 --
Total Return Fund (32,491 shares; cost -- $340,870)........... -- -- 337,911
Dividend receivable ........................................... 6,068 45 5,946
Receivable from affiliate ..................................... -- -- --
Receivable for units sold ..................................... -- -- --
------- ------ -------
TOTAL ASSETS ............................................... 132,160 10,992 343,857
------- ------ -------
LIABILITIES
Accrued expenses payable to affiliate (note 3) ................ 138 5 136
Payable for units withdrawn ................................... -- -- --
------- ------ -------
TOTAL LIABILITIES .......................................... 138 5 136
------- ------ -------
Net assets attributable to variable deferred annuity
contractholders .............................................. $132,022 10,987 343,721
======= ====== =======
Outstanding units: Type I (note 2) ............................ 2,799 42 6,299
======= ====== =======
Net asset value per unit: Type I .............................. $ 10.24 12.14 10.67
======== ======= ========
Outstanding units: Type II (note 2) ........................... 10,094 863 25,915
======== ======= ========
Net asset value per unit: Type II ............................. $ 10.24 12.14 10.67
======== ======= ========
</TABLE>
See accompanying notes to financial statements.
A-10
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC.
-----------------------------------------------------------------------------
GOVERNMENT
S&P 500 SECURITIES
FUND FUND
---------------------------------------------- ------------------------------
PERIOD YEAR
ENDED ENDED
YEAR ENDED DECEMBER 31, DECEMBER 11, DECEMBER 31,
1998 1997 1996 1997 1996
-------------- -------------- ---------------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ........................... $11,434,493 4,001,897 23,435,279 -- 1,309,648
Expenses -- Mortality and expense
risk charges (note 3) ....................... 2,910,483 1,356,740 492,403 147,796 143,919
----------- --------- ---------- ------- ---------
Net investment income (expense) ................ 8,524,010 2,645,157 22,942,876 (147,796) 1,165,729
----------- --------- ---------- -------- ---------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) ...................... 8,830,544 (899,446) 1,510,464 (242,895) (68,248)
Unrealized appreciation (depreciation)
on investments .............................. 35,731,485 21,611,136 (16,204,375) 987,049 (995,503)
----------- ---------- ----------- -------- ---------
Net realized and unrealized gain (loss) on
investments ................................... 44,562,029 20,711,690 (14,693,911) 744,154 (1,063,751)
----------- ---------- ----------- -------- ----------
Increase in net assets from operations ......... $53,086,039 23,356,847 8,248,965 596,358 101,978
=========== ========== =========== ======== ==========
</TABLE>
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
---------------------------------------------
MONEY MARKET
FUND
---------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
------------- --------------- ---------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends ......................... $9,177,451 5,626,589 5,204,323
Expenses -- Mortality and expense
risk charges (note 3) ..................... 2,260,774 1,421,044 980,270
---------- --------- ---------
Net investment income (expense) .............. 6,916,677 4,205,545 4,224,053
---------- --------- ---------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) .................... 545,381 (4,421,730) 1,686,452
Unrealized appreciation (depreciation) on
investments ............................... (545,381) 4,383,879 (2,984,484)
---------- ---------- ----------
Net realized and unrealized gain (loss) on
investments ................................. -- (37,851) (1,298,032)
---------- ---------- ----------
Increase in net assets from operations ....... $6,916,677 4,167,694 2,926,021
========== ========== ==========
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-------------------------------------------
TOTAL RETURN
FUND
-------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
------------- ------------- ---------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends ......................... $ 3,360,564 6,098,862 9,319,880
Expenses -- Mortality and expense
risk charges (note 3) ..................... 691,738 496,469 357,589
--------- --------- ---------
Net investment income (expense) .............. 2,668,826 5,602,393 8,962,291
--------- --------- ---------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) .................... (144,205) (454,827) 614,446
Unrealized appreciation (depreciation) on
investments ............................... 5,408,858 657,828 (6,827,262)
--------- --------- ----------
Net realized and unrealized gain (loss) on
investments ................................. 5,264,653 203,001 (6,212,816)
--------- --------- ----------
Increase in net assets from operations ....... $7,933,479 5,805,394 2,749,475
========= ========= ==========
</TABLE>
A-11
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-------------------------------------------
INTERNATIONAL
EQUITY FUND
-------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
------------- --------------- -------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends ............ $1,445,436 2,686,699 1,056,063
Expenses -- Mortality
and expense risk
charges (note 3) ............. 150,854 113,987 56,953
---------- --------- ---------
Net investment income ........... 1,294,582 2,572,712 999,110
---------- --------- ---------
Net realized and
unrealized gain (loss)
on investments:
Net realized gain
(loss) ....................... 441,842 665,649 86,537
Unrealized appreciation
(depreciation) on
investments .................. 2,296,938 (1,565,382) (11,119)
---------- ---------- ---------
Net realized and
unrealized gain (loss)
on investments ................. 2,738,780 (899,733) 75,418
---------- ---------- ---------
Increase (decrease) in net
assets from operations ......... $4,033,362 1,672,979 1,074,528
========== ========== =========
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-------------------------------------------------------------------------
REAL ESTATE GLOBAL INCOME
SECURITIES FUND FUND
-------------------------------------------- ----------------------------
PERIOD FROM
YEAR MAY 1, 1997
ENDED TO
YEAR ENDED DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1998 1997
---------------- --------------- ----------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ............ $3,597,838 5,456,896 1,627,291 555,349 300,672
Expenses -- Mortality
and expense risk
charges (note 3) ............. 461,754 292,230 49,030 29,070 2,982
--------- --------- --------- ------- -------
Net investment income ........... 3,136,084 5,164,666 1,578,261 526,279 297,690
--------- --------- --------- ------- -------
Net realized and
unrealized gain (loss)
on investments:
Net realized gain
(loss) ....................... (878,569) 2,710,582 299,159 96,320 2,417
Unrealized appreciation
(depreciation) on
investments .................. (12,908,191) (1,305,117) 4,059,521 337,555 (124,348)
----------- ---------- --------- ------- --------
Net realized and
unrealized gain (loss)
on investments ................. (13,786,760) 1,405,465 4,358,680 433,875 (121,931)
----------- ---------- --------- ------- --------
Increase (decrease) in net
assets from operations ......... $(10,650,676) 6,570,131 5,936,941 960,154 175,759
=========== ========== ========= ======= ========
</TABLE>
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-----------------------------------------------------------------------------
VALUE EQUITY FUND INCOME FUND U.S. EQUITY FUND
----------------------------- ----------------------------- -----------------
PERIOD FROM PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR DECEMBER 12, MAY 4, 1998
ENDED 1997 TO ENDED 1997 TO TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997 1998
-------------- -------------- -------------- -------------- -----------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ..................... $1,119,457 142,788 1,901,291 58,034 52,288
Expenses -- Mortality and expense risk
charges (note 3) ...................... 348,877 38,307 329,876 14,197 6,218
---------- ------- --------- ------ ------
Net investment income .................... 770,580 104,481 1,571,415 43,837 46,070
---------- ------- --------- ------ ------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) ................ 576,810 357,048 335,927 (6,710) 9,452
Unrealized appreciation (depreciation)
on investments ........................ (292,099) 885,799 (245,492) (12,199) 153,754
---------- ------- --------- ------- -------
Net realized and unrealized gain (loss) on
investments ............................. 284,711 1,242,847 90,435 (18,909) 163,206
---------- --------- --------- ------- -------
Increase (decrease) in net assets from
operations .............................. $1,055,291 1,347,328 1,661,850 24,928 209,276
========== ========= ========= ======= =======
</TABLE>
A-12
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENT OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
-------------------------------------------------------------------------
MONEY FUND BOND FUND
------------------------------ ----------------------------------------
PERIOD YEAR
ENDED ENDED
DECEMBER 11, DECEMBER 31, YEAR ENDED DECEMBER 31,
1997 1996 1998 1997 1996
-------------- ------------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ........................... $110,711 175,537 1,310,262 2,260,511 1,774,226
Expenses -- Mortality and expense risk
charges (note 3) ............................ 25,908 40,663 613,418 437,693 336,825
-------- ------- --------- --------- ---------
Net investment income .......................... 84,803 134,874 696,844 1,822,818 1,437,401
-------- ------- --------- --------- ---------
Net realized and unrealized gain (loss) on
investments:
Net realized gain ............................. -- -- 557,479 187,695 106,242
Unrealized appreciation (depreciation) on
investments ................................. -- -- 1,205,533 663,371 (442,815)
-------- ------- --------- --------- ---------
Net realized and unrealized gain (loss) on
investments ................................... -- -- 1,763,012 851,066 (336,573)
-------- ------- --------- --------- ---------
Increase in net assets from operations ......... $ 84,803 134,874 2,459,856 2,673,884 1,100,828
======== ======= ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
--------------------------------------------------------------------------------
CAPITAL APPRECIATION FUND GROWTH FUND
----------------------------------------- --------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
--------------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ................. $ 5,903,722 8,221,818 6,069,096 14,489,848 4,911,400 3,110,376
Expenses -- Mortality and expense
risk charges (note 3) ............. 2,644,408 2,381,196 1,506,102 2,092,013 1,372,378 599,846
----------- --------- --------- ---------- --------- ---------
Net investment income ................ 3,259,314 5,840,622 4,562,994 12,397,835 3,539,022 2,510,530
----------- --------- --------- ---------- --------- ---------
Net realized and unrealized gain
(loss) on investments:
Net realized gain ................... 19,896,478 6,868,228 6,301,279 19,777,101 5,826,603 1,959,742
Unrealized appreciation
(depreciation) on investments ..... (396,149) 5,927,622 7,478,382 922,343 11,621,155 5,568,726
----------- --------- --------- ---------- ---------- ---------
Net realized and unrealized gain
(loss) on investments ............... 19,500,329 12,795,850 13,779,661 20,699,444 17,447,758 7,528,468
----------- ---------- ---------- ---------- ---------- ---------
Increase in net assets from
operations .......................... $22,759,643 18,636,472 18,342,655 33,097,279 20,986,780 10,038,998
=========== ========== ========== ========== ========== ==========
</TABLE>
A-13
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
---------------------------------------------------------------------------------
HIGH INCOME FUND MULTIPLE STRATEGIES FUND
---------------------------------------- ----------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
--------------- ------------ ----------- --------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ......................... $ 7,439,338 9,138,791 6,387,294 4,756,691 4,485,399 3,343,955
Expenses -- Mortality and expense risk
charges (note 3) .......................... 2,078,631 1,397,317 825,956 957,372 794,598 571,993
------------ --------- --------- --------- --------- ---------
Net investment income ........................ 5,360,707 7,741,474 5,561,338 3,799,319 3,690,801 2,771,962
------------ --------- --------- --------- --------- ---------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) .................... (99,049) 1,298,149 763,575 1,712,582 1,435,981 701,256
Unrealized appreciation (depreciation)
on investments ............................ (7,301,468) 2,089,422 2,079,281 (1,662,556) 4,025,778 2,786,345
------------ --------- --------- ---------- --------- ---------
Net realized and unrealized gain (loss) on
investments ................................. (7,400,517) 3,387,571 2,842,856 50,026 5,461,759 3,487,601
------------ --------- --------- ---------- --------- ---------
Increase (decrease) in net assets from
operations .................................. $ (2,039,810) 11,129,045 8,404,194 3,849,345 9,152,560 6,259,563
============ ========== ========= ========== ========= =========
</TABLE>
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
-----------------------------------------------------------
MONEY MARKET PORTFOLIO HIGH INCOME PORTFOLIO
----------------------------- -----------------------------
PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
DECEMBER 11, DECEMBER 31, DECEMBER 11, DECEMBER 31,
1997 1996 1997 1996
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Investment income:
Income -- Dividends .......... $843,023 1,655,033 1,930,318 2,780,632
Expenses -- Mortality
and expense risk
charges (note 3) ........... 212,121 382,911 277,254 332,922
-------- --------- --------- ---------
Net investment income ......... 630,902 1,272,122 1,653,064 2,447,710
-------- --------- --------- ---------
Net realized and unrealized
gain on investments:
Net realized gain ............ -- -- 4,673,705 479,085
Unrealized appreciation
(depreciation) on
investments ................ -- -- (2,814,608) 308,688
-------- --------- ---------- ---------
Net realized and unrealized
gain on investments .......... -- -- 1,859,097 787,773
-------- --------- ---------- ---------
Increase in net assets from
operations ................... $630,902 1,272,122 3,512,161 3,235,483
======== ========= ========== =========
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
-------------------------------------------
EQUITY -- INCOME PORTFOLIO
-------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- ------------- -------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends .......... $40,199,361 42,510,440 12,605,854
Expenses -- Mortality
and expense risk
charges (note 3) ........... 8,478,683 6,650,343 4,253,036
---------- ---------- ----------
Net investment income ......... 31,720,678 35,860,097 8,352,818
---------- ---------- ----------
Net realized and unrealized
gain on investments:
Net realized gain ............ 40,058,923 15,417,526 9,394,625
Unrealized appreciation
(depreciation) on
investments ................ (9,194,909) 65,899,106 23,601,942
---------- ---------- ----------
Net realized and unrealized
gain on investments .......... 30,864,014 81,316,632 32,996,567
---------- ---------- ----------
Increase in net assets from
operations ................... $62,584,692 117,176,729 41,349,385
========== =========== ==========
</TABLE>
A-14
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND (CONTINUED)
-------------------------------------------------------------------------------------
GROWTH PORTFOLIO OVERSEAS PORTFOLIO
---------------------------------------- --------------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
-------------- ------------ ------------ --------------- --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends .................. $ 43,602,357 9,229,913 13,903,188 8,392,807 9,303,257 2,309,161
Expenses -- Mortality and expense
risk charges (note 3) .............. 4,321,431 3,552,903 2,834,086 1,337,177 1,401,167 1,245,263
------------ --------- ---------- --------- --------- ---------
Net investment income ................. 39,280,926 5,677,010 11,069,102 7,055,630 7,902,090 1,063,898
------------ --------- ---------- --------- --------- ---------
Net realized and unrealized gain on
investments:
Net realized gain .................... 17,030,101 14,576,544 9,229,819 12,998,779 6,802,686 2,693,770
Unrealized appreciation
(depreciation) on investments ...... 58,825,099 34,536,532 6,990,625 (6,292,784) (3,387,543) 7,585,836
------------ ---------- ---------- ---------- ---------- ---------
Net realized and unrealized gain on
investments .......................... 75,855,200 49,113,076 16,220,444 6,705,995 3,415,143 10,279,606
------------ ---------- ---------- ---------- ---------- ----------
Increase in net assets from
operations ........................... $115,136,126 54,790,086 27,289,546 13,761,625 11,317,233 11,343,504
============ ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND II
---------------------------------------------------------------------------------
ASSET MANAGER PORTFOLIO CONTRAFUND PORTFOLIO
---------------------------------------- ----------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
-------------- ------------ ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends .................. $ 61,032,559 52,909,448 27,801,550 14,347,723 4,672,962 634,656
Expenses -- Mortality and expense
risk charges (note 3) .............. 5,632,482 5,474,604 4,059,911 3,674,218 2,588,608 1,322,883
------------ ---------- ---------- ---------- --------- ---------
Net investment income (expense) ....... 55,400,077 47,434,844 23,741,639 10,673,505 2,084,354 (688,227)
------------ ---------- ---------- ---------- --------- ---------
Net realized and unrealized gain
(loss) on investments:
Net realized gain .................... 12,994,733 9,093,636 7,507,674 14,314,697 9,468,307 2,738,082
Unrealized appreciation
(depreciation) on investments ...... (5,404,033) 24,430,304 23,008,153 47,868,379 26,750,686 17,275,767
------------ ---------- ---------- ---------- ---------- ----------
Net realized and unrealized gain on
investments .......................... 7,590,700 33,523,940 30,515,827 62,183,076 36,218,993 20,013,849
------------ ---------- ---------- ---------- ---------- ----------
Increase in net assets from
operations ........................... $ 62,990,777 80,958,784 54,257,466 72,856,581 38,303,347 19,325,622
============ ========== ========== ========== ========== ==========
</TABLE>
A-15
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS
FUND III
----------------------------------------------------------------
GROWTH & INCOME GROWTH OPPORTUNITIES
PORTFOLIO PORTFOLIO
------------------------------- ------------------------------
PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR MAY 1,
ENDED 1997 TO ENDED 1997 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Investment income:
Income -- Dividends ........................... $ 102,863 -- 948,628 --
Expenses -- Mortality and expense risk
charges (note 3) ............................ 420,269 53,296 450,247 69,440
---------- ------ ------- ------
Net investment income (expense) ................ (317,406) (53,296) 498,381 (69,440)
---------- ------- ------- -------
Net realized and unrealized gain (loss) on
investments:
Net realized gain ............................. 983,225 103,153 378,467 67,071
Unrealized appreciation (depreciation) on
investments ................................. 7,912,728 458,100 6,815,534 1,055,758
---------- ------- --------- ---------
Net realized and unrealized gain on
investments ................................... 8,895,953 561,253 7,194,001 1,122,829
---------- ------- --------- ---------
Increase in net assets from operations ......... $8,578,547 507,957 7,692,382 1,053,389
========== ======= ========= =========
</TABLE>
<TABLE>
<CAPTION>
NEUBERGER & BERMAN ADVISERS MANAGEMENT TRUST
----------------------------------------------------------------------------------------
BALANCED BOND GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
----------------------------- ----------------------------- ----------------------------
PERIOD YEAR PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
DECEMBER 11, DECEMBER 31, DECEMBER 11, DECEMBER 31, DECEMBER 11, DECEMBER 31,
1997 1996 1997 1996 1997 1996
-------------- -------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ................. $ 1,992,971 5,226,886 550,544 1,231,424 903,849 1,152,528
Expenses -- Mortality and
expense risk charges (note 3) ..... 337,918 381,777 99,586 151,484 132,989 146,484
------------ --------- ------- --------- ------- ---------
Net investment income ................ 1,655,053 4,845,109 450,958 1,079,940 770,860 1,006,044
------------ --------- ------- --------- ------- ---------
Net realized and unrealized gain
(loss) on investments:
Net realized gain (loss) ............ 5,097,861 419,822 12,018 (136,701) 2,304,768 315,046
Unrealized depreciation on
investments ....................... (2,501,835) (3,501,201) (23,525) (646,673) (880,241) (363,320)
------------ ---------- ------- --------- --------- ---------
Net realized and unrealized gain
(loss) on investments ............... 2,596,026 (3,081,379) (11,507) (783,374) 1,424,527 (48,274)
------------ ---------- ------- --------- --------- ---------
Increase in net assets from
operations .......................... $ 4,251,079 1,763,730 439,451 296,566 2,195,387 957,770
============ ========== ======= ========= ========= =========
</TABLE>
A-16
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEDERATED INVESTORS INSURANCE SERIES
-------------------------------------------------------------------------------
AMERICAN LEADERS FUND II HIGH INCOME BOND FUND II
------------------------------------------ ------------------------------------
PERIOD FROM
MAY 6,
1996 TO
YEAR ENDED DECEMBER 31, DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
------------- ------------- -------------- ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ......................... $2,907,843 228,362 15,977 1,241,858 1,129,533 579,337
Expenses -- Mortality and expense risk
charges (note 3) .......................... 753,675 228,448 12,003 591,059 302,211 87,381
---------- ------- ------ --------- --------- -------
Net investment income (expense) .............. 2,154,168 (86) 3,974 650,799 827,322 491,956
---------- ------- ------ --------- --------- -------
Net realized and unrealized gain (loss) on
investments:
Net realized gain ........................... 1,333,508 544,140 29,680 901,146 630,351 31,769
Unrealized appreciation (depreciation) on
investments ............................... 4,019,536 3,385,309 162,046 (615,798) 1,256,745 424,014
---------- --------- ------- --------- --------- -------
Net realized and unrealized gain on
investments ................................. 5,353,044 3,929,449 191,726 285,348 1,887,096 455,783
---------- --------- ------- --------- --------- -------
Increase in net assets from operations ....... $7,507,212 3,929,363 195,700 936,147 2,714,418 947,739
========== ========= ======= ========= ========= =======
</TABLE>
<TABLE>
<CAPTION>
FEDERATED INVESTORS INSURANCE SERIES
(CONTINUED)
------------------------------------------
UTILITY
FUND II
------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
------------- ----------- ------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends ............................................. $2,141,701 1,046,132 766,616
Expenses -- Mortality and expense risk charges (note 3) ......... 482,289 326,253 243,314
---------- --------- -------
Net investment income (expense) .................................. 1,659,412 719,879 523,302
---------- --------- -------
Net realized and unrealized gain (loss) on investments:
Net realized gain ............................................... 1,730,044 731,431 336,527
Unrealized appreciation (depreciation) on investments ........... 1,205,055 4,302,272 1,113,241
---------- --------- ---------
Net realized and unrealized gain on investments .................. 2,935,099 5,033,703 1,449,768
---------- --------- ---------
Increase in net assets from operations ........................... $4,594,511 5,753,582 1,973,070
========== ========= =========
</TABLE>
A-17
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
ALGER AMERICAN FUND
--------------------------------------------------------------------------------
SMALL CAP PORTFOLIO GROWTH PORTFOLIO
---------------------------------------- ---------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
-------------- ----------- ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ..................... $10,556,556 2,044,748 105,411 14,231,938 528,437 668,828
Expenses -- Mortality and expense
risk charges (note 3) ................. 1,053,686 799,242 414,206 1,251,175 811,338 358,846
----------- --------- ------- ---------- ------- -------
Net investment income (expense) .......... 9,502,870 1,245,506 (308,795) 12,980,763 (282,901) 309,982
----------- --------- -------- ---------- -------- -------
Net realized and unrealized gain
(loss) on investments:
Net realized gain (loss) ................ 411,066 411,624 (122,299) 4,172,054 3,954,588 315,644
Unrealized appreciation
(depreciation) on investments ......... 2,406,527 4,016,910 (80,937) 20,408,775 8,095,163 2,224,353
----------- --------- -------- ---------- --------- ---------
Net realized and unrealized gain
(loss) on investments ................... 2,817,593 4,428,534 (203,236) 24,580,829 12,049,751 2,539,997
----------- --------- -------- ---------- ---------- ---------
Increase (decrease) in net assets from
operations .............................. $12,320,463 5,674,040 (512,031) 37,561,592 11,766,850 2,849,979
=========== ========= ======== ========== ========== =========
</TABLE>
<TABLE>
<CAPTION>
PBHG INSURANCE SERIES FUND
----------------------------------------------------------------
PBHG LARGE CAP GROWTH PORTFOLIO PBHG GROWTH II PORTFOLIO
------------------------------- ------------------------------
PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR MAY 1,
ENDED 1997 TO ENDED 1997 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Investment income:
Income -- Dividends ..................... -- -- -- --
Expenses -- Mortality and expense
risk charges (note 3) ................. $ 106,500 17,112 119,244 30,512
------- ------ ------- ------
Net investment income (expense) .......... (106,500) (17,112) (119,244) (30,512)
Net realized and unrealized gain
(loss) on investments:
Net realized gain (loss) ................ 282,909 13,525 (281,878) 7,643
Unrealized appreciation
(depreciation) on investments ......... 2,025,080 149,898 1,029,558 (89,829)
--------- ------- --------- -------
Net realized and unrealized gain
(loss) on investments ................... 2,307,989 163,423 747,680 (82,186)
--------- ------- ------- --------
Increase (decrease) in net assets from
operations .............................. $2,201,489 146,311 628,436 (112,698)
========= ======= ======= =========
</TABLE>
A-18
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
------------------------------------------------------------------------------------
AGGRESSIVE GROWTH PORTFOLIO GROWTH PORTFOLIO
--------------------------------------------- --------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
--------------- --------------- ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends .................... $ -- -- 755,467 17,061,080 5,821,316 3,316,849
Expenses -- Mortality and expense
risk charges (note 3) ................ 1,431,833 1,187,720 880,271 3,390,909 2,533,302 1,496,337
------------ --------- ------- ---------- --------- ---------
Net investment income (expense) ......... (1,431,833) (1,187,720) (124,804) 13,670,171 3,288,014 1,820,512
------------ ---------- -------- ---------- --------- ---------
Net realized and unrealized gain
(loss) on investments:
Net realized gain ...................... 11,413,034 6,675,700 3,422,984 11,096,226 9,346,395 4,286,543
Unrealized appreciation on
investments .......................... 24,333,274 5,540,954 109,555 56,452,101 23,212,981 11,457,707
------------ ---------- --------- ---------- ---------- ----------
Net realized and unrealized gain on
investments ............................ 35,746,308 12,216,654 3,532,539 67,548,327 32,559,376 15,744,250
------------ ---------- --------- ---------- ---------- ----------
Increase in net assets from
operations ............................. $ 34,314,475 11,028,934 3,407,735 81,218,498 35,847,390 17,564,762
============ ========== ========= ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
--------------------------------------------
WORLDWIDE GROWTH PORTFOLIO
--------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
-------------- ------------ ------------
<S> <C> <C> <C>
Investment income:
Income -- Dividends .................................... $17,147,178 4,490,822 2,094,632
Expenses -- Mortality and expense risk charges
(note 3) ............................................. 5,690,337 3,656,021 1,418,611
---------- ---------- ---------
Net investment income (expense) ......................... 11,456,841 834,801 676,021
Net realized and unrealized gain (loss) on
investments:
Net realized gain ...................................... 46,111,510 11,585,008 5,069,677
Unrealized appreciation on investments ................. 41,481,543 32,530,512 18,944,795
---------- ----------- ----------
Net realized and unrealized gain on investments ......... 87,593,053 44,115,520 24,014,472
---------- ---------- ------------
Increase in net assets from operations .................. 99,049,894 44,950,321 24,690,493
========== ========== ==========
</TABLE>
A-19
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
---------------------------------------------------------------------------------
BALANCED PORTFOLIO FLEXIBLE INCOME PORTFOLIO
------------------------------------------ ------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
------------- ----------- ------------ ----------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends .................... $ 5,350,454 1,376,630 283,521 1,625,697 699,223 288,802
Expenses -- Mortality and expense
risk charges (note 3) ................ 1,445,276 445,275 113,425 300,350 120,354 40,424
----------- --------- ------- --------- ------- -------
Net investment income (expense) ......... 3,905,178 931,355 170,096 1,325,347 578,869 248,378
----------- --------- ------- --------- ------- -------
Net realized and unrealized gain
(loss) on investments:
Net realized gain ...................... 3,053,389 1,239,519 122,576 222,001 86,470 4,524
Unrealized appreciation on
investments .......................... 28,743,051 4,013,343 920,620 30,008 269,390 68,898
----------- --------- ------- --------- ------- -------
Net realized and unrealized gain on
investments ............................ 31,796,440 5,252,862 1,043,196 252,009 355,860 73,422
----------- --------- --------- --------- ------- -------
Increase in net assets from
operations ............................. $35,701,618 6,184,217 1,213,292 1,577,356 934,729 321,800
=========== ========= ========= ========= ======= =======
</TABLE>
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
-----------------------------------------------------------------------
CAPITAL APPRECIATION
INTERNATIONAL GROWTH PORTFOLIO PORTFOLIO
------------------------------------------ ----------------------------
PERIOD FROM PERIOD FROM
MAY 3, YEAR MAY 2,
1996 TO ENDED 1997 TO
YEAR ENDED DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1998 1997
------------- ------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ............................ $1,349,473 348,585 54,433 20,652 8,437
Expenses -- Mortality and expense risk
charges (note 3) ............................. 895,918 516,236 45,378 149,815 9,981
---------- ------- ------ ------- -----
Net investment income (expense) ................. 453,555 (167,651) 9,055 (129,163) (1,544)
---------- -------- ------ -------- ------
Net realized and unrealized gain (loss) on
investments:
Net realized gain .............................. 7,205,182 3,329,942 187,391 336,728 31,894
Unrealized appreciation on investments ......... 1,486,427 1,235,644 586,615 7,532,890 12,182
---------- --------- ------- --------- ------
Net realized and unrealized gain on
investments .................................... 8,691,609 4,565,586 774,006 7,869,618 44,076
---------- --------- ------- --------- ------
Increase in net assets from operations .......... $9,145,164 4,397,935 783,061 7,740,455 42,532
========== ========= ======= ========= ======
</TABLE>
A-20
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF OPERATIONS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GOLDMAN SACHS SALOMON BROTHERS
VARIABLE INSURANCE VARIABLE SERIES
TRUST FUND FUND
------------------------------- -----------------------------------------------
GROWTH AND MID CAP STRATEGIC TOTAL
INCOME EQUITY BOND INVESTORS RETURN
FUND FUND FUND FUND FUND
-------------- -------------- -------------- -------------- -------------
PERIOD FROM PERIOD FROM PERIOD FROM PERIOD FROM PERIOD FROM
MAY 12, MAY 8, OCTOBER 22, NOVEMBER 27, OCTOBER 30,
1998 TO 1998 TO 1998 TO 1998 TO 1998 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1998 1998 1998 1998
-------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Investment income:
Income -- Dividends ..................... $ 35,739 27,603 6,068 45 5,946
Expenses -- Mortality and expense
risk charges (note 3) ................. 15,729 15,427 211 5 148
--------- ------ ----- -- -----
Net investment income .................... 20,010 12,176 5,857 40 5,798
--------- ------ ----- -- -----
Net realized and unrealized gain
(loss) on investments:
Net realized gain (loss) ................ (32,043) (72,641) 322 -- 1
Unrealized appreciation
(depreciation) on investments ......... 40,081 12,789 (4,823) 321 (2,958)
--------- ------- ------ --- ------
Net realized and unrealized gain
(loss) on investments ................... 8,038 (59,852) (4,501) 321 (2,957)
--------- ------- ------ --- ------
Increase (decrease) in net assets from
operations .............................. $ 28,048 (47,676) 1,356 361 2,841
========= ======= ====== === ======
</TABLE>
See accompanying notes to financial statements.
A-21
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC.
------------------------------------------------------------------------------
S&P 500 GOVERNMENT
INDEX SECURITIES
FUND FUND
----------------------------------------------- ------------------------------
PERIOD YEAR
ENDED ENDED
YEAR ENDED DECEMBER 31, DECEMBER 11, DECEMBER 31,
1998 1997 1996 1997 1996
--------------- -------------- ---------------- ---------------- -------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) ............... $ 8,524,010 2,645,157 22,942,876 (147,796) 1,165,729
Net realized gain (loss) ...................... 8,830,544 (899,446) 1,510,464 (242,895) (68,248)
Unrealized appreciation
(depreciation) on investments ............... 35,731,485 21,611,136 (16,204,375) 987,049 (995,503)
------------- ---------- ----------- -------- ---------
Increase in net assets from operations ......... 53,086,039 23,356,847 8,248,965 596,358 101,978
------------- ---------- ----------- -------- ---------
From capital transactions:
Net premiums .................................. 53,735,217 40,575,050 18,225,715 1,053,538 3,734,757
Transfers (to) from the general
account of Life of Virginia:
Death benefits .............................. (1,018,619) (1,735,027) (77,864) (64,230) (76,802)
Surrenders .................................. (11,869,972) (3,415,596) (1,079,082) (666,510) (492,750)
Administrative expense (note 3) ............. (193,962) (102,362) (45,091) (18,501) (21,731)
Transfer gain (loss) and transfer
fees ....................................... 623,320 (4,503) 7,463 (36,688) 8,420
Transfers (to) from the Guarantee
Account (note 1) ............................ 40,155,936 14,747,561 3,139,208 827,432 135,548
Interfund transfers ........................... 20,883,117 24,135,903 5,665,381 (14,821,369) (65,339)
------------- ---------- ----------- ----------- ---------
Increase (decrease) in net assets from
capital transactions .......................... 102,315,037 74,201,026 25,835,730 (13,726,328) 3,222,103
------------- ---------- ----------- ----------- ---------
Increase (decrease) in net assets .............. 155,401,076 97,557,873 34,084,695 (13,129,970) 3,324,081
Net assets at beginning of year ................ 153,426,324 55,868,451 21,783,756 13,129,970 9,805,889
------------- ---------- ----------- ----------- ---------
Net assets at end of year ...................... $ 308,827,400 153,426,324 55,868,451 -- 13,129,970
============= =========== =========== =========== ==========
</TABLE>
A-22
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-----------------------------------------------
MONEY MARKET FUND
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ....................... $ 6,916,677 4,205,545 4,224,053
Net realized gain (loss) .......... 545,381 (4,421,730) 1,686,452
Unrealized appreciation
(depreciation) on
investments ..................... (545,381) 4,383,879 (2,984,484)
------------- ---------- ----------
Increase in net assets from
operations ........................ 6,916,677 4,167,694 2,926,021
------------- ---------- ----------
From capital transactions:
Net premiums ...................... 103,629,024 107,140,555 153,728,177
Transfers (to) from the
general account of Life of
Virginia:
Death benefits .................. (4,961,886) (1,753,311) (781,386)
Surrenders ...................... (46,255,514) (18,383,973) (8,255,412)
Administrative expense
(note 3) ....................... (222,910) (134,339) (78,769)
Transfer gain (loss) and
transfer fees .................. 6,222,666 (130,614) 28,173
Transfers (to) from the
Guarantee Account
(note 1) ........................ 24,299,736 10,195,112 4,298,099
Interfund transfers ............... 5,214,444 (67,593,593) (93,981,321)
------------- ----------- -----------
Increase (decrease) in net assets
from capital transactions ......... 87,925,560 29,339,837 54,957,561
------------- ----------- -----------
Increase (decrease) in net
assets ............................ 94,842,237 33,507,531 57,883,582
Net assets at beginning of year..... 123,694,704 90,187,173 2,200,980
------------- ----------- -----------
Net assets at end of year .......... $ 218,536,941 123,694,704 60,084,562
============= =========== ===========
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-----------------------------------------------
TOTAL RETURN FUND
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ....................... 2,668,826 5,602,393 8,962,291
Net realized gain (loss) .......... (144,205) (454,827) 614,446
Unrealized appreciation
(depreciation) on
investments ..................... 5,408,858 657,828 (6,827,262)
--------- --------- ----------
Increase in net assets from
operations ........................ 7,933,479 5,805,394 2,749,475
--------- --------- ----------
From capital transactions:
Net premiums ...................... 7,103,374 5,641,626 8,515,814
Transfers (to) from the
general account of Life of
Virginia:
Death benefits .................. (336,462) (271,179) (153,153)
Surrenders ...................... (3,264,071) (2,558,265) (946,894)
Administrative expense
(note 3) ....................... (63,853) (60,731) (51,588)
Transfer gain (loss) and
transfer fees .................. 76,515 (15,082) (69,616)
Transfers (to) from the
Guarantee Account
(note 1) ........................ 9,157,868 2,622,768 919,901
Interfund transfers ............... 974,377 (231,875) 75,151
---------- ---------- ----------
Increase (decrease) in net assets
from capital transactions ......... 13,647,748 5,127,262 8,289,615
---------- ---------- ----------
Increase (decrease) in net
assets ............................ 21,581,227 10,932,656 11,039,090
Net assets at beginning of year..... 44,527,117 33,594,461 22,555,371
---------- ---------- ----------
Net assets at end of year .......... 66,108,344 44,527,117 33,594,461
========== ========== ==========
</TABLE>
A-23
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND REAL ESTATE SECURITIES FUND
--------------------------------------------- --------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997
--------------- --------------- ------------- ---------------- ---------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .................. $ 1,294,582 2,572,712 999,110 3,136,084 5,164,666
Net realized gain (loss) ............... 441,842 665,649 86,537 (878,569) 2,710,582
Unrealized appreciation
(depreciation) on
investments .......................... 2,296,938 (1,565,382) (11,119) (12,908,191) (1,305,117)
------------ ---------- ------- ----------- ----------
Increase (decrease) in net assets
from operations ........................ 4,033,362 1,672,979 1,074,528 (10,650,676) 6,570,131
------------ ---------- --------- ----------- ----------
Net premiums ........................... 985,487 1,854,537 2,563,735 5,008,291 10,679,221
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (49,268) (2,360) (3,522) (182,572) (18,462)
Surrenders ........................... (558,600) (349,063) (103,501) (1,142,178) (654,786)
Administrative expense
(note 3) ............................ (13,254) (10,458) (6,060) (30,467) (19,846)
Transfer gain and transfer
fees ................................ (258,988) 49,348 (92,027) (443,138) 122,915
Capital contribution ................. -- -- 10,925,561 -- --
Transfers from the Guarantee
Account (note 1) ..................... 1,469,927 1,095,648 557,466 6,836,059 4,443,497
Interfund transfers .................... (1,665,448) 664,758 1,263,184 (5,533,571) 5,849,780
------------ ---------- ---------- ----------- ----------
Increase (decrease) in net assets
from capital transactions .............. (90,144) 3,302,410 15,104,836 4,512,424 20,402,319
------------ ---------- ---------- ----------- ----------
Increase (decrease) in net assets ....... 3,943,218 4,975,389 16,179,364 (6,138,252) 26,972,450
Net assets at beginning of
period ................................. 22,876,533 17,901,144 1,721,780 52,683,797 25,711,347
------------ ---------- ---------- ----------- ----------
Net assets at end of period ............. $ 26,819,751 22,876,533 17,901,144 46,545,545 52,683,797
============ ========== ========== =========== ==========
<CAPTION>
REAL ESTATE
SECURITIES
FUND
--------------
YEAR ENDED
DECEMBER 31,
1996
--------------
<S> <C>
Increase (decrease) in net assets
From operations:
Net investment income .................. 1,578,261
Net realized gain (loss) ............... 299,159
Unrealized appreciation
(depreciation) on
investments .......................... 4,059,521
---------
Increase (decrease) in net assets
from operations ........................ 5,936,941
---------
Net premiums ........................... 2,949,990
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... --
Surrenders ........................... (41,760)
Administrative expense
(note 3) ............................ (3,136)
Transfer gain and transfer
fees ................................ (107,856)
Capital contribution ................. --
Transfers from the Guarantee
Account (note 1) ..................... 539,647
Interfund transfers .................... 4,063,439
---------
Increase (decrease) in net assets
from capital transactions .............. 7,400,324
---------
Increase (decrease) in net assets ....... 13,337,265
Net assets at beginning of
period ................................. 12,374,082
----------
Net assets at end of period ............. 25,711,347
==========
</TABLE>
A-24
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-----------------------------------------------------------
GLOBAL INCOME FUND VALUE EQUITY FUND
----------------------------- -----------------------------
PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR MAY 1,
ENDED 1997 TO ENDED 1997 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .............. $ 526,279 $ 297,690 770,580 104,481
Net realized gain (loss) ........... 96,320 2,417 576,810 357,048
Unrealized appreciation
(depreciation) on
investments ...................... 337,555 (124,348) (292,099) 885,799
---------- ----------- -------- -------
Increase (decrease) in net assets
from operations .................... 960,154 175,759 1,055,291 1,347,328
---------- ----------- --------- ---------
Net premiums ....................... 600,772 198,123 9,579,320 3,244,942
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... -- -- (25,562) (1,960)
Surrenders ....................... (63,958) (5,701) (1,731,724) (75,503)
Administrative expense
(note 3) ........................ -- (209) (18,611) (1,938)
Transfer gain and transfer
fees ............................ (1,623) (472) 1,014,745 15,109
Capital contribution ............. 45,130 5,000,000 -- 3,000,000
Transfers from the Guarantee
Account (note 1) ................. 986,575 234,749 8,817,658 2,034,025
Interfund transfers ................ 1,028,376 513,049 4,550,014 6,338,005
---------- ----------- ---------- ---------
Increase (decrease) in net assets
from capital transactions .......... 2,595,272 5,939,539 22,185,840 14,552,680
---------- ----------- ---------- ----------
Increase (decrease) in net
assets ............................. 3,555,426 6,115,298 23,241,131 15,900,008
Net assets at beginning of
period ............................. 6,115,298 -- 15,900,008 --
---------- ----------- ---------- ----------
Net assets at end of period ......... $9,670,724 6,115,298 39,141,139 15,900,008
========== =========== ========== ==========
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
-------------------------------------------
U.S.
EQUITY
INCOME FUND FUND
----------------------------- -------------
PERIOD FROM PERIOD FROM
YEAR DECEMBER 12, MAY 4,
ENDED 1997 TO 1998 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998
-------------- -------------- -------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .............. $ 1,571,415 43,837 46,070
Net realized gain (loss) ........... 335,927 (6,710) 9,452
Unrealized appreciation
(depreciation) on
investments ...................... (245,492) (12,199) 153,754
--------- ------- -------
Increase (decrease) in net assets
from operations .................... 1,661,850 24,928 209,276
--------- ------- -------
Net premiums ....................... 1,921,255 19,521 864,801
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (145,003) -- --
Surrenders ....................... (1,961,475) (59,137) (8,236)
Administrative expense
(note 3) ........................ (34,884) (2,414) (374)
Transfer gain and transfer
fees ............................ (172,635) (467) 4,703
Capital contribution ............. -- -- --
Transfers from the Guarantee
Account (note 1) ................. 4,132,905 52,096 500,876
Interfund transfers ................ 6,911,104 21,976,333 629,934
---------- ---------- -------
Increase (decrease) in net assets
from capital transactions .......... 10,651,267 21,985,932 1,991,704
---------- ---------- ---------
Increase (decrease) in net
assets ............................. 12,313,117 22,010,860 2,200,980
Net assets at beginning of
period ............................. 22,010,860 -- --
---------- ---------- ---------
Net assets at end of period ......... 34,323,977 22,010,860 2,200,980
========== ========== =========
</TABLE>
A-25
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
------------------------------------------------------------------------------
MONEY FUND BOND FUND
------------------------------ -----------------------------------------------
PERIOD YEAR
ENDED ENDED
DECEMBER 11, DECEMBER 31, YEAR ENDED DECEMBER 31,
1997 1996 1998 1997 1996
-------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ......................... $ 84,803 134,874 696,844 1,822,818 1,437,401
Net realized gain ............................. -- -- 557,479 187,695 106,242
Unrealized appreciation
(depreciation) on investments ............... -- -- 1,205,533 663,371 (442,815)
------------ ------- --------- --------- ---------
Increase in net assets from operations ......... 84,803 134,874 9,138,791 2,673,884 1,100,828
------------ ------- --------- --------- ---------
From capital transactions:
Net premiums .................................. 440 1,000 6,231,291 3,472,666 6,447,661
Transfers (to) from the general
account of Life of Virginia:
Death benefits .............................. -- (25,650) (410,382) (234,610) (255,232)
Surrenders .................................. -- (248,877) (4,432,337) (2,350,488) (1,174,644)
Administrative expense (note 3) ............. -- (7,741) (55,996) (53,814) (47,633)
Transfer gain (loss) and transfer
fees ....................................... (4,611) (6,711) (86,859) (12,509) 15,212
Transfers (to) from the Guarantee
Account (note 1) ............................ (9,897) (72,686) 8,638,887 3,535,189 1,424,034
Interfund transfers ........................... (2,736,806) (1,858,335) 10,655,917 1,076,424 1,248,636
------------ ---------- ---------- ---------- ----------
Increase (decrease) in net assets from
capital transactions .......................... (2,750,874) (2,219,000) 20,540,521 5,432,858 7,658,034
------------ ---------- ---------- ---------- ----------
Increase (decrease) in net assets .............. (2,666,071) (2,084,126) 29,679,312 8,106,742 8,758,862
Net assets at beginning of year ................ 2,750,676 4,834,802 39,745,683 31,638,941 22,880,079
------------ ---------- ---------- ---------- ----------
Net assets at end of year ...................... $ -- 2,750,676 69,424,995 39,745,683 31,638,941
============ ========== ========== ========== ==========
</TABLE>
A-26
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
--------------------------------------------------------------------------------------------
CAPITAL APPRECIATION FUND GROWTH FUND
---------------------------------------------- ---------------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
---------------- -------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .............. $ 3,259,314 5,840,622 4,562,994 12,397,835 3,539,022 2,510,530
Net realized gain .................. 19,896,478 6,868,228 6,301,279 19,777,101 5,826,603 1,959,742
Unrealized appreciation
(depreciation) on
investments ...................... (396,149) 5,927,622 7,478,382 922,343 11,621,155 5,568,726
------------- --------- --------- ---------- ---------- ---------
Increase in net assets from
operations ......................... 22,759,643 18,636,472 18,342,655 33,097,279 20,986,780 10,038,998
------------- ---------- ---------- ---------- ---------- ----------
From capital transactions:
Net premiums ....................... 9,377,106 25,418,900 35,523,585 17,725,498 31,719,458 15,322,231
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (796,601) (450,528) (577,949) (894,216) (350,617) (246,052)
Surrenders ....................... (11,332,990) (7,755,383) (5,679,609) (9,299,680) (5,238,134) (1,802,707)
Administrative expense
(note 3) ........................ (280,687) (291,649) (237,053) (184,119) (138,883) (79,593)
Transfer gain (loss) and
transfer fees ................... (1,028,582) (53,714) (234,268) (3,882) (28,403) (9,390)
Transfers (to) from the
Guarantee Account
(note 1) ......................... 11,708,764 13,461,161 5,093,547 17,267,813 12,928,357 2,323,647
Interfund transfers ................ (20,227,182) 37,796 16,982,928 (7,357,815) 11,277,889 8,265,699
------------- ---------- ---------- ---------- ---------- ----------
Increase (decrease) in net assets
from capital transactions .......... (12,580,172) 30,366,583 50,871,181 17,253,599 50,169,667 23,773,835
------------- ---------- ---------- ---------- ---------- ----------
Increase (decrease) in net
assets ............................. 10,179,471 49,003,055 69,213,836 50,350,878 71,156,447 33,812,833
Net assets at beginning
of year ............................ 207,847,236 158,844,181 89,630,345 139,015,816 67,859,369 34,046,536
------------- ----------- ---------- ----------- ---------- ----------
Net assets at end of year ........... $ 218,026,707 207,847,236 158,844,181 189,366,694 139,015,816 67,859,369
============= =========== =========== =========== =========== ==========
</TABLE>
A-27
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
----------------------------------------------
HIGH INCOME FUND
---------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- -------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ................... $ 5,360,707 7,741,474 5,561,338
Net realized gain (loss) ................ (99,049) 1,298,149 763,575
Unrealized appreciation
(depreciation) on investments ......... (7,301,468) 2,089,422 2,079,281
------------- --------- ---------
Increase (decrease) in net assets from
operations .............................. (2,039,810) 11,129,045 8,404,194
------------- ---------- ---------
From capital transactions:
Net premiums ............................ 13,886,757 21,931,355 22,356,655
Transfers (to) from the general
account of Life of Virginia:
Death benefits ........................ (1,060,654) (689,590) (693,092)
Surrenders ............................ (10,775,891) (5,920,831) (2,655,530)
Administrative expense (note 3) ....... (189,819) (139,006) (100,320)
Transfer gain (loss) and transfer
fees ................................. (612,294) (112,330) (25,953)
Transfers (to) from the Guarantee
Account (note 1) ...................... 20,861,727 12,750,648 3,777,050
Interfund transfers ..................... (4,351,060) 23,573,698 9,730,803
------------- ---------- ----------
Increase in net assets from capital
transactions ............................ 17,758,766 51,393,944 32,389,613
------------- ---------- ----------
Increase in net assets ................... 15,718,956 62,522,989 40,793,807
Net assets at beginning of year .......... 148,285,626 85,762,637 44,968,830
------------- ---------- ----------
Net assets at end of year ................ $ 164,004,582 148,285,626 85,762,637
============= =========== ==========
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS (CONTINUED)
-----------------------------------------------
MULTIPLE STRATEGIES FUND
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ................... 3,799,319 3,690,801 2,771,962
Net realized gain (loss) ................ 1,712,582 1,435,981 701,256
Unrealized appreciation
(depreciation) on investments ......... (1,662,556) 4,025,778 2,786,345
---------- --------- ---------
Increase (decrease) in net assets from
operations .............................. 3,849,345 9,152,560 6,259,563
---------- --------- ---------
From capital transactions:
Net premiums ............................ 5,911,134 9,089,218 8,520,761
Transfers (to) from the general
account of Life of Virginia:
Death benefits ........................ (527,685) (332,263) (389,751)
Surrenders ............................ (6,115,145) (4,493,985) (2,097,537)
Administrative expense (note 3) ....... (118,214) (119,442) (104,392)
Transfer gain (loss) and transfer
fees ................................. (298,427) (8,995) (27,395)
Transfers (to) from the Guarantee
Account (note 1) ...................... 8,281,940 4,101,390 1,507,791
Interfund transfers ..................... (3,251,940) 516,158 198,943
---------- ---------- ----------
Increase in net assets from capital
transactions ............................ 3,881,663 8,752,081 7,608,420
---------- ---------- ----------
Increase in net assets ................... 7,731,008 17,904,641 13,867,983
Net assets at beginning of year .......... 72,023,553 54,118,912 40,250,929
---------- ---------- ----------
Net assets at end of year ................ 79,754,561 72,023,553 54,118,912
========== ========== ==========
</TABLE>
A-28
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
------------------------------------------------------------------------
MONEY MARKET PORTFOLIO HIGH INCOME PORTFOLIO
----------------------------------- ----------------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
DECEMBER 11, DECEMBER 31, DECEMBER 11, DECEMBER 31,
1997 1996 1997 1996
---------------- ---------------- ---------------- ---------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ............................ $ 630,902 1,272,122 1,653,064 2,447,710
Net realized gain ................................ -- -- 4,673,705 479,085
Unrealized appreciation (depreciation) on
investments .................................... -- -- (2,814,608) 308,688
------------- --------- ---------- ---------
Increase in net assets from operations ............ 630,902 1,272,122 3,512,161 3,235,483
------------- --------- ---------- ---------
From capital transactions:
Net premiums ..................................... (28,472) 117,921 8,207 (248,987)
Transfers (to) from the general account of
Life of Virginia:
Death benefits ................................. (193,170) (458,667) (66,792) (33,131)
Surrenders ..................................... (1,206,916) (2,213,343) (2,281,288) (1,859,776)
Administrative expense (note 3) ................ (39,130) (65,257) (46,012) (54,571)
Transfer gain (loss) and transfer fees ......... 86,971 (204,381) (18,007) (14,545)
Transfers (to) from the Guarantee Account
(note 1) ....................................... (27,901) (661,457) (23,044) (109,624)
Interfund transfers .............................. (21,205,932) (23,959,305) (25,886,326) (7,008,575)
------------- ----------- ----------- ----------
Increase (decrease) in net assets from capital
transactions ..................................... (22,614,550) (27,444,489) (28,313,262) (9,329,209)
------------- ----------- ----------- ----------
Increase (decrease) in net assets ................. (21,983,648) (26,172,367) (24,801,101) (6,093,726)
Net assets at beginning of year ................... 21,983,648 48,156,015 24,801,101 30,894,827
------------- ----------- ----------- ----------
Net assets at end of year ......................... $ -- 21,983,648 -- 24,801,101
============= =========== =========== ==========
</TABLE>
A-29
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND (CONTINUED)
-------------------------------------------------
EQUITY-INCOME PORTFOLIO
-------------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
---------------- ---------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .............. $ 31,720,678 $ 35,860,097 8,352,818
Net realized gain .................. 40,058,923 15,417,526 9,394,625
Unrealized appreciation
(depreciation) on
investments ...................... (9,194,909) 65,899,106 23,601,942
------------- -------------- ----------
Increase in net assets from
operations ......................... 62,584,692 117,176,729 41,349,385
------------- -------------- ----------
From capital transactions:
Net premiums ....................... 46,774,052 78,673,490 91,217,558
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (3,800,272) (3,144,602) (2,317,929)
Surrenders ....................... (39,388,010) (22,544,378) (12,923,609)
Administrative expense
(note 3) ........................ (787,804) (744,663) (565,181)
Transfer gain (loss) and
transfer fees ................... (4,002,591) (156,609) (81,577)
Transfers (to) from the
Guarantee Account
(note 1) ......................... 49,734,168 34,236,802 14,669,920
Interfund transfers ................ (32,464,680) 4,787,401 12,688,430
------------- -------------- -----------
Increase (decrease) in net assets
from capital transactions .......... 16,064,863 91,107,441 102,687,612
------------- -------------- -----------
Increase (decrease) in net
assets ............................. 78,649,555 208,284,170 144,036,997
Net assets at beginning
of year ............................ 613,582,772 405,298,602 261,261,605
------------- -------------- -----------
Net assets at end of year ........... $ 692,232,327 613,582,772 405,298,602
============= ============== ===========
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND (CONTINUED)
-----------------------------------------------
GROWTH PORTFOLIO
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income .............. 39,280,926 5,677,010 11,069,102
Net realized gain .................. 17,030,101 14,576,544 9,229,819
Unrealized appreciation
(depreciation) on
investments ...................... 58,825,099 34,536,532 6,990,625
---------- ---------- ----------
Increase in net assets from
operations ......................... 115,136,126 54,790,086 27,289,546
----------- ---------- ----------
From capital transactions:
Net premiums ....................... 15,214,848 19,742,111 40,351,417
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (2,191,698) (1,127,415) (1,395,457)
Surrenders ....................... (23,927,419) (15,488,583) (8,362,725)
Administrative expense
(note 3) ........................ (510,394) (502,085) (441,506)
Transfer gain (loss) and
transfer fees ................... (1,467,259) (84,076) (243,398)
Transfers (to) from the
Guarantee Account
(note 1) ......................... 9,000,692 9,277,787 7,334,280
Interfund transfers ................ (8,701,771) (3,139,585) (3,259,632)
----------- ----------- ----------
Increase (decrease) in net assets
from capital transactions .......... (12,583,001) 8,678,154 33,982,979
----------- ----------- ----------
Increase (decrease) in net
assets ............................. 102,553,125 63,468,240 61,272,525
Net assets at beginning
of year ............................ 315,013,607 251,545,367 190,272,842
----------- ----------- -----------
Net assets at end of year ........... 417,566,732 315,013,607 251,545,367
=========== =========== ===========
</TABLE>
A-30
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND (CONTINUED)
----------------------------------------------
OVERSEAS PORTFOLIO
----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) .......................... $ 7,055,630 7,902,090 1,063,898
Net realized gain ................... 12,998,779 6,802,686 2,693,770
Unrealized appreciation
(depreciation) on investments....... (6,292,784) (3,387,543) 7,585,836
------------- ---------- ---------
Increase in net assets from
operations .......................... 13,761,625 11,317,233 11,343,504
------------- ---------- ----------
From capital transactions:
Net premiums ........................ 1,843,855 5,009,263 11,020,984
Transfers (to) from the general
account of Life of Virginia:
Death benefits ..................... (439,740) (527,674) (528,522)
Surrenders ......................... (6,306,537) (5,102,924) (3,972,175)
Administrative expense
(note 3) ......................... (183,116) (220,173) (214,759)
Transfer gain (loss) and
transfer fees .................... (1,416,329) (38,435) (85,300)
Transfers (to) from Guarantee
Account (note 1) .................. 2,209,192 3,378,950 3,116,987
Interfund transfers ................. (14,310,296) (12,846,872) (4,620,473)
------------- ----------- ----------
Increase (decrease) in net assets
from capital transactions ........... (18,602,971) (10,347,865) 4,716,742
------------- ----------- ----------
Increase (decrease) in net assets .... (4,841,346) 969,368 16,060,246
Net assets at beginning of period .... 108,304,621 107,335,253 91,275,007
------------- ----------- ----------
Net assets at end of period .......... $ 103,463,275 108,304,621 107,335,253
============= =========== ===========
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND II
-----------------------------------------------
ASSET MANAGER PORTFOLIO
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- ---------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) .......................... 55,400,077 47,434,844 23,741,639
Net realized gain ................... 12,994,733 9,093,636 7,507,674
Unrealized appreciation
(depreciation) on investments....... (5,404,033) 24,430,304 23,008,153
---------- ---------- ----------
Increase in net assets from
operations .......................... 62,990,777 80,958,784 54,257,466
---------- ---------- ----------
From capital transactions:
Net premiums ........................ 10,264,331 12,956,133 15,580,792
Transfers (to) from the general
account of Life of Virginia:
Death benefits ..................... (2,712,196) (2,389,147) (3,090,108)
Surrenders ......................... (43,729,546) (26,860,066) (23,863,347)
Administrative expense
(note 3) ......................... (1,091,339) (1,170,300) (1,159,170)
Transfer gain (loss) and
transfer fees .................... (6,077,325) (5,281,252) (2,150,299)
Transfers (to) from Guarantee
Account (note 1) .................... 9,427,060 4,580,560 2,112,849
Interfund transfers ................. (12,459,422) (14,758,069) (31,512,425)
----------- ----------- -----------
Increase (decrease) in net assets
from capital transactions ........... (46,378,437) (32,922,141) (44,081,708)
----------- ----------- -----------
Increase (decrease) in net assets .... 16,612,340 48,036,643 10,175,758
Net assets at beginning of period .... 483,874,812 435,838,169 425,662,411
----------- ----------- -----------
Net assets at end of period .......... 500,487,152 483,874,812 435,838,169
=========== =========== ===========
</TABLE>
A-31
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
VARIABLE INSURANCE
PRODUCTS FUND II (CONTINUED)
----------------------------------------------
CONTRAFUND PORTFOLIO
----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
---------------- -------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................... $ 10,673,505 2,084,354 (688,227)
Net realized gain .................... 14,314,697 9,468,307 2,738,082
Unrealized appreciation
(depreciation) on
investments ......................... 47,868,379 26,750,686 17,275,767
------------- ---------- ----------
Increase in net assets from
operations ........................... 72,856,581 38,303,347 19,325,622
------------- ---------- ----------
From capital transactions:
Net premiums ......................... 25,285,801 39,049,020 41,520,289
Transfers (to) from the general
account of Life of Virginia:
Death benefits ...................... (1,246,412) (778,781) (569,391)
Surrenders .......................... (13,148,361) (7,578,528) (3,409,236)
Administrative expense
(note 3) .......................... (296,892) (239,385) (139,550)
Transfer gain (loss) and
transfer fees ..................... (122,549) (1,813) (6,491)
Transfers (to) from Guarantee
Account (note 1) .................... 25,805,412 20,874,655 8,894,897
Interfund transfers .................. (7,547,010) 9,642,188 15,486,630
------------- ---------- ----------
Increase (decrease) in net assets
from capital transactions ............ 28,729,989 60,967,356 61,777,148
------------- ---------- ----------
Increase (decrease) in net assets ..... 101,586,570 99,270,703 81,102,770
Net assets at beginning
of period ............................ 242,137,396 142,866,693 61,763,923
------------- ----------- ----------
Net assets at end of period ........... $ 343,723,966 242,137,396 142,866,693
============= =========== ===========
<CAPTION>
VARIABLE INSURANCE
PRODUCTS FUND II (CONTINUED)
----------------------------------------------------------
GROWTH & GROWTH
INCOME PORTFOLIO OPPORTUNITIES PORTFOLIO
----------------------------- ----------------------------
PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR MAY 1,
ENDED 1997 TO ENDED 1997 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................... (317,406) (53,296) 498,381 (69,440)
Net realized gain .................... 983,225 103,153 378,467 67,071
Unrealized appreciation
(depreciation) on
investments ......................... 7,912,728 458,100 6,815,534 1,055,758
--------- ------- --------- ---------
Increase in net assets from
operations ........................... 8,578,547 507,957 7,692,382 1,053,389
--------- ------- --------- ---------
From capital transactions:
Net premiums ......................... 13,303,380 5,782,503 10,151,968 6,759,512
Transfers (to) from the general
account of Life of Virginia:
Death benefits ...................... (688,026) (2,062) (104,398) (11,218)
Surrenders .......................... (1,264,908) (116,741) (1,515,091) (178,411)
Administrative expense
(note 3) .......................... (29,641) (3,046) (29,463) (4,370)
Transfer gain (loss) and
transfer fees ..................... 732,615 358,955 483,076 734
Transfers (to) from Guarantee
Account (note 1) .................... 10,185,026 2,665,501 10,705,328 2,684,605
Interfund transfers .................. 10,322,368 6,515,155 9,164,481 6,783,534
---------- --------- ---------- ---------
Increase (decrease) in net assets
from capital transactions ............ 32,560,814 15,200,265 28,855,901 16,034,386
---------- ---------- ---------- ----------
Increase (decrease) in net assets ..... 41,139,361 15,708,222 36,548,283 17,087,775
Net assets at beginning
of period ............................ 15,708,222 -- 17,087,775 --
---------- ---------- ---------- ----------
Net assets at end of period ........... 56,847,583 15,708,222 53,636,058 17,087,775
========== ========== ========== ==========
</TABLE>
A-32
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
NEUBERGER & BERMAN ADVISERS
MANAGEMENT TRUST
-------------------------------
BALANCED PORTFOLIO
-------------------------------
PERIOD YEAR
ENDED ENDED
DECEMBER 11, DECEMBER 31,
1997 1996
---------------- --------------
<S> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ..................... $ 1,655,053 4,845,109
Net realized gain (loss) .................. 5,097,861 419,822
Unrealized (depreciation) on
investments ............................. (2,501,835) (3,501,201)
-------------- ----------
Increase in net assets from operations ..... 4,251,079 1,763,730
-------------- ----------
From capital transactions:
Net premiums .............................. (6,001) --
Transfers (to) from the general
account of Life of Virginia:
Death benefits .......................... (126,435) (191,199)
Surrenders .............................. (2,675,228) (2,074,244)
Administrative expense (note 3) ......... (71,576) (82,124)
Transfer gain (loss) and transfer
fees ................................... (78,959) (12,205)
Capital contribution .................... (629,209) --
Transfers (to) from the Guarantee
Account (note 1) ........................ (185,078) (37,694)
Interfund transfers ....................... (31,241,057) (3,810,712)
-------------- ----------
Decrease in net assets from capital
transactions .............................. (35,013,543) (6,208,178)
-------------- ----------
Decrease in net assets ..................... (30,762,464) (4,444,448)
Net assets at beginning of year ............ 30,762,464 35,206,912
-------------- ----------
Net assets at end of year .................. $ -- 30,762,464
============== ==========
<CAPTION>
NEUBERGER & BERMAN ADVISERS MANAGEMENT TRUST
----------------------------------------------------------------
BOND PORTFOLIO GROWTH PORTFOLIO
------------------------------- --------------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
DECEMBER 11, DECEMBER 31, DECEMBER 11, DECEMBER 31,
1997 1996 1997 1996
---------------- -------------- ---------------- ---------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ..................... 450,958 1,079,940 770,860 1,006,044
Net realized gain (loss) .................. 12,018 (136,701) 2,304,768 315,046
Unrealized (depreciation) on
investments ............................. (23,525) (646,673) (880,241) (363,320)
------- --------- --------- ---------
Increase in net assets from operations ..... 439,451 296,566 2,195,387 957,770
------- --------- --------- ---------
From capital transactions:
Net premiums .............................. 1,800 -- 6,456 4,370
Transfers (to) from the general
account of Life of Virginia:
Death benefits .......................... (196,037) (225,838) (58,098) (56,431)
Surrenders .............................. (508,821) (366,908) (247,815) (415,296)
Administrative expense (note 3) ......... (15,911) (24,278) (22,353) (25,172)
Transfer gain (loss) and transfer
fees ................................... (11,476) (9,665) (2,057) (10,420)
Capital contribution .................... -- -- -- --
Transfers (to) from the Guarantee
Account (note 1) ........................ (86,454) (92,797) -- (14,970)
Interfund transfers ....................... (9,344,589) (5,700,964) (12,373,616) (3,652,818)
---------- ---------- ----------- ----------
Decrease in net assets from capital
transactions .............................. (10,161,488) (6,420,450) (12,697,483) (4,170,737)
----------- ---------- ----------- ----------
Decrease in net assets ..................... (9,722,037) (6,123,884) (10,502,096) (3,212,967)
Net assets at beginning of year ............ 9,722,037 15,845,921 10,502,096 13,715,063
----------- ---------- ----------- ----------
Net assets at end of year .................. -- 9,722,037 -- 10,502,096
=========== ========== =========== ==========
</TABLE>
A-33
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEDERATED INVESTORS INSURANCE SERIES
------------------------------------------------------------------------------------------
AMERICAN LEADERS FUND II HIGH INCOMEBOND FUND II
-------------------------------------------- ---------------------------------------------
PERIOD FROM
MAY 6,
1996 TO
YEAR ENDED DECEMBER 31, DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
--------------- -------------- ------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................ $ 2,154,168 (86) 3,974 650,799 827,322 491,956
Net realized gain .................. 1,333,508 544,140 29,680 901,146 630,351 31,769
Unrealized appreciation
(depreciation) on
investments ...................... 4,019,536 3,385,309 162,046 (615,798) 1,256,745 424,014
------------ --------- ------- -------- --------- -------
Increase in net assets from
operations ......................... 7,507,212 3,929,363 195,700 936,147 2,714,418 947,739
------------ --------- ------- -------- --------- -------
From capital transactions:
Net premiums ....................... 17,174,298 13,540,849 2,249,062 7,609,375 9,254,617 4,468,263
Transfers (to) from the
general account of
Life of Virginia:
Death benefits ................... (702,585) (91,917) -- (420,052) (120,443) (42,084)
Surrenders ....................... (2,256,129) (423,567) (28,376) (3,031,255) (861,128) (428,701)
Administrative expense
(note 3) ........................ (47,545) (11,789) (522) (34,940) (18,435) (5,233)
Transfer gain (loss) and
transfer fees ................... 404,576 791 4,221 650,014 (2,424) (43)
Transfers from the Guarantee
Account (note 1) ................. 15,132,233 4,966,466 146,563 12,815,682 4,882,888 670,397
Interfund transfers ................ 2,109,439 9,208,512 1,208,370 (1,253,689) 5,675,771 6,113,878
------------ ---------- --------- ---------- --------- ---------
Increase in net assets from
capital transactions ............... 31,814,287 27,189,345 3,579,318 16,335,135 18,810,846 10,776,477
------------ ---------- --------- ---------- ---------- ----------
Increase in net assets .............. 39,321,499 31,118,708 3,775,018 17,271,282 21,525,264 11,724,216
Net assets at beginning of
period ............................. 34,893,726 3,775,018 -- 35,195,347 13,670,083 1,945,867
------------ ---------- --------- ---------- ---------- ----------
Net assets at end of period ......... $ 74,215,225 34,893,726 3,775,018 52,466,629 35,195,347 13,670,083
============ ========== ========= ========== ========== ==========
</TABLE>
A-34
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
FEDERATED INVESTORS INSURANCE SERIES (CONTINUED)
UTILITY FUND II
--------------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) ............................... 1,659,412 719,879 523,302
Net realized gain ............................................. 1,730,044 731,431 336,527
Unrealized appreciation (depreciation) on investments ......... 1,205,055 4,302,272 1,113,241
Increase in net assets from operations ......................... 4,594,511 5,753,582 1,973,070
From capital transactions:
Net premiums .................................................. 5,300,423 3,510,754 7,032,730
Transfers (to) from the general account of Life of Virginia:
Death benefits .............................................. (295,533) (63,646) (172,666)
Surrenders .................................................. (1,872,219) (1,420,075) (708,499)
Administrative expense (note 3) ............................. (36,851) (32,050) (25,376)
Transfer gain (loss) and transfer fees ...................... (738,016) (1,043) 11,752
Transfers from the Guarantee Account (note 1) ................. 5,791,377 1,540,929 1,313,211
Interfund transfers ........................................... 2,670,259 (1,399,267) 830,436
Increase in net assets from capital transactions ............... 10,819,440 2,135,602 8,281,588
Increase in net assets ......................................... 15,413,951 7,889,184 10,254,658
Net assets at beginning of period .............................. 30,397,894 22,508,710 12,254,052
Net assets at end of period .................................... 45,811,845 30,397,894 22,508,710
</TABLE>
A-35
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
ALGER AMERICAN
-------------------------------------------------------------------------------------------
SMALL CAP PORTFOLIO GROWTH PORTFOLIO
--------------------------------------------- ---------------------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1998 1997 1996 1998 1997 1996
--------------- -------------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................ $ 9,502,870 1,245,506 (308,795) 12,980,763 (282,901) 309,982
Net realized gain (loss) ........... 411,066 411,624 (122,299) 4,172,054 3,954,588 315,644
Unrealized appreciation
(depreciation) on
investments ...................... 2,406,527 4,016,910 (80,937) 20,408,775 8,095,163 2,224,353
------------ --------- -------- ---------- --------- ---------
Increase (decrease) in net assets
from operations .................... 12,320,463 5,674,040 (512,031) 37,561,592 11,766,850 2,849,979
------------ --------- -------- ---------- ---------- ---------
From capital transactions:
Net premiums ....................... 6,622,636 12,048,925 25,934,981 11,725,922 13,470,987 21,518,317
Transfers (to) from the
general account of
Life of Virginia:
Death benefits ................... (459,998) (296,448) (167,439) (663,235) (317,671) (22,815)
Surrenders ....................... (3,709,013) (1,974,869) (837,016) (5,345,156) (2,065,182) (539,265)
Administrative expense
(note 3) ........................ (83,804) (69,752) (32,819) (89,422) (68,206) (26,996)
Transfer gain (loss) and
transfer fees ................... 246,716 20,656 (18,410) (10,013) (390,379) (32,858)
Transfers from the Guarantee
Account (note 1) ................. 8,384,117 9,339,897 5,067,731 9,961,009 6,594,835 3,628,084
Interfund transfers ................ (2,794,548) 1,782,889 10,297,239 6,706,761 (1,557,814) 11,823,073
------------ ---------- ---------- ---------- ---------- ----------
Increase in net assets from
capital transactions ............... 8,206,106 20,851,298 40,244,267 22,285,866 15,666,570 36,347,540
------------ ---------- ---------- ---------- ---------- ----------
Increase in net assets .............. 20,526,569 26,525,338 39,732,236 59,847,458 27,433,420 39,197,519
Net assets at beginning of
period ............................. 73,827,690 47,302,352 7,570,116 72,153,813 44,720,393 5,522,874
------------ ---------- ---------- ---------- ---------- ----------
Net assets at end of period ......... $ 94,354,259 73,827,690 47,302,352 132,001,271 72,153,813 44,720,393
============ ========== ========== =========== ========== ==========
</TABLE>
A-36
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
PBHG INSURANCE SERIES FUND
----------------------------------------------------------------
PBHG LARGE CAP PORTFOLIO PBHG GROWTH II PORTFOLIO
------------------------------- ------------------------------
PERIOD FROM PERIOD FROM
YEAR MAY 1, YEAR MAY 1,
ENDED 1997 TO ENDED 1997 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) .......................... (106,500) (17,112) (119,244) (30,512)
Net realized gain (loss) ................................. 282,909 13,525 (281,878) 7,643
Unrealized appreciation (depreciation) on
investments ............................................ 2,025,080 149,898 1,029,558 (89,829)
--------- ------- --------- -------
Increase (decrease) in net assets from operations ......... 2,201,489 146,311 628,436 (112,698)
--------- ------- --------- --------
From capital transactions:
Net premiums ............................................. 2,342,871 1,239,113 1,855,144 3,502,382
Transfers (to) from the general account of
Life of Virginia:
Death benefits ......................................... (42,994) (715) (117,890) --
Surrenders ............................................. (588,848) (12,383) (409,105) (53,142)
Administrative expense (note 3) ........................ (7,464) (684) (8,868) (1,455)
Transfer gain (loss) and transfer fees ................. 40,495 865 27,528 787
Transfers from the Guarantee Account
(note 1) ............................................... 2,026,921 610,146 2,485,422 1,108,447
Interfund transfers ...................................... 1,290,849 2,735,614 (477,840) 2,507,619
--------- --------- --------- ---------
Increase in net assets from capital transactions .......... 5,061,830 4,571,956 3,354,391 7,064,638
--------- --------- --------- ---------
Increase in net assets .................................... 7,263,319 4,718,267 3,982,827 6,951,940
Net assets at beginning of period ......................... 4,718,267 -- 6,951,940 --
--------- --------- --------- ---------
Net assets at end of period ............................... 11,981,586 4,718,267 10,934,767 6,951,940
========== ========= ========== =========
</TABLE>
A-37
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES
-----------------------------------------------
AGGRESSIVE GROWTH PORTFOLIO
-----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
---------------- --------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................ $ (1,431,833) (1,187,720) (124,804)
Net realized gain .................. 11,413,034 6,675,700 3,422,984
Unrealized appreciation on
investments ...................... 24,333,274 5,540,954 109,555
------------ ---------- ---------
Increase in net assets from
operations ....................... 34,314,475 11,028,934 3,407,735
------------ ---------- ---------
Increase in net assets from
operations .........................
From capital transactions:
Net premiums ....................... 4,886,885 11,681,150 17,880,226
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (815,476) (427,386) (394,284)
Surrenders ....................... (5,681,643) (2,997,601) (2,851,517)
Administrative expense
(note 3) ........................ (120,730) (120,078) (112,813)
Transfer gain (loss) and
transfer fees ................... (352,260) (19,458) (40,003)
Transfers (to) from the
Guarantee Account
(note 1) ......................... 4,693,626 4,987,441 3,328,781
Interfund transfers ................ (8,460,504) (2,281,417) 8,025,078
------------ ---------- ----------
Increase (decrease) in net assets
from capital transactions .......... (5,850,102) 10,822,651 25,835,468
------------ ---------- ----------
Increase in net assets .............. 28,464,373 21,851,585 29,243,203
Net assets at beginning of year...... 105,815,122 83,963,537 54,720,334
------------ ---------- ----------
Net assets at end of year ........... $134,279,495 105,815,122 83,963,537
============ =========== ==========
<CAPTION>
JANUS ASPEN SERIES
----------------------------------------------
GROWTH PORTFOLIO
----------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income
(expense) ........................ 13,670,171 3,288,014 1,820,512
Net realized gain .................. 11,096,226 9,346,395 4,286,543
Unrealized appreciation on
investments ...................... 56,452,101 23,212,981 11,457,707
---------- ---------- ----------
Increase in net assets from
operations ....................... 81,218,498 35,847,390 17,564,762
---------- ---------- ----------
Increase in net assets from
operations .........................
From capital transactions:
Net premiums ....................... 19,968,429 30,338,859 35,456,497
Transfers (to) from the
general account of Life of
Virginia:
Death benefits ................... (1,360,596) (1,849,634) (483,092)
Surrenders ....................... (11,799,421) (9,041,380) (3,747,509)
Administrative expense
(note 3) ........................ (317,146) (280,500) (199,595)
Transfer gain (loss) and
transfer fees ................... (691,664) (152,642) (208,664)
Transfers (to) from the
Guarantee Account
(note 1) ......................... 19,406,972 16,216,500 7,027,293
Interfund transfers ................ 3,890,833 1,293,752 11,381,396
----------- ---------- ----------
Increase (decrease) in net assets
from capital transactions .......... 29,097,407 36,524,955 49,226,326
----------- ---------- ----------
Increase in net assets .............. 110,315,905 72,372,345 66,791,088
Net assets at beginning of year...... 224,068,917 151,696,572 84,905,484
----------- ----------- ----------
Net assets at end of year ........... 334,384,822 224,068,917 151,696,572
=========== =========== ===========
</TABLE>
A-38
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
--------------------------------------------------
WORLDWIDE GROWTH PORTFOLIO
--------------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- --------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) .................................... 11,456,841 834,801 676,021
Net realized gain .................................................. 46,111,510 11,585,008 5,069,677
Unrealized appreciation on investments ............................. 41,481,543 32,530,512 18,944,795
---------- ---------- ----------
Increase in net assets from operations ........................... 99,049,894 44,950,321 24,690,493
---------- ---------- ----------
Increase in net assets from operations ..............................
From capital transactions:
Net premiums ....................................................... 44,526,187 77,908,754 45,862,046
Transfers (to) from the general account of
Life of Virginia:
Death benefits ................................................... (1,373,901) (916,155) (407,146)
Surrenders ....................................................... (19,617,340) (9,754,795) (2,394,900)
Administrative expense (note 3) .................................. (469,515) (346,218) (172,873)
Transfer gain (loss) and transfer fees ........................... 125,152 (116,774) (183,599)
Transfers (to) from the Guarantee Account (note 1) ................. 41,574,483 30,845,279 8,313,366
Interfund transfers ................................................ (124,706) 25,144,972 42,049,450
----------- ---------- ----------
Increase (decrease) in net assets from capital transactions ......... 64,640,360 122,765,063 93,066,344
----------- ----------- ----------
Increase in net assets .............................................. 163,690,254 167,715,384 117,756,837
Net assets at beginning of year ..................................... 345,126,082 177,410,698 59,653,861
----------- ----------- -----------
Net assets at end of year ........................................... $ 508,816,336 345,126,082 177,410,698
============= =========== ===========
</TABLE>
A-39
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
---------------------------------------------
BALANCED PORTFOLIO
---------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
--------------- -------------- --------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) .......... $ 3,905,178 931,355 170,096
Net realized gain ........................ 3,053,389 1,239,519 122,576
Unrealized appreciation on
investments ............................ 28,743,051 4,013,343 920,620
------------ --------- -------
Increase in net assets from operations..... 35,701,618 6,184,217 1,213,292
------------ --------- ---------
Net premiums ............................. 24,644,401 15,654,806 8,643,527
Transfers (to) from the general
account of Life of Virginia:
Death benefits ......................... (857,556) (98,529) (37,496)
Surrenders ............................. (9,165,787) (1,560,191) (271,087)
Administrative expense (note 3) ........ (138,515) (34,113) (7,301)
Transfer gain (loss) and transfer
fees .................................. 1,031,515 (11,920) 5,413
Transfer (to) from the Guarantee
Account (note 1) ....................... 24,485,481 6,551,408 1,091,622
Interfund transfers ...................... 21,236,757 34,492,843 3,850,513
------------ ---------- ---------
Increase in net assets from capital
transactions ............................. 61,236,296 54,994,304 13,275,191
------------ ---------- ----------
Increase in net assets .................... 96,937,914 61,178,521 14,488,483
Net assets at beginning of period ......... 77,638,235 16,459,714 1,971,231
------------ ---------- ----------
$174,576,149 77,638,235 16,459,714
============ ========== ==========
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
------------------------------------------
FLEXIBLE INCOME PORTFOLIO
------------------------------------------
YEAR ENDED DECEMBER 31,
1998 1997 1996
-------------- -------------- ------------
<S> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) .......... 1,325,347 578,869 248,378
Net realized gain ........................ 222,001 86,470 4,524
Unrealized appreciation on
investments ............................ 30,008 269,390 68,898
--------- ------- -------
Increase in net assets from operations..... 1,577,356 934,729 321,800
--------- ------- -------
Net premiums ............................. 4,066,867 3,465,715 2,591,080
Transfers (to) from the general
account of Life of Virginia:
Death benefits ......................... (36,188) (55,866) --
Surrenders ............................. (813,459) (425,891) (29,518)
Administrative expense (note 3) ........ (21,644) (8,897) (2,717)
Transfer gain (loss) and transfer
fees .................................. 453,024 1,786 (413)
Transfer (to) from the Guarantee
Account (note 1) ....................... 7,043,148 3,010,637 345,536
Interfund transfers ...................... 6,439,490 2,406,219 992,086
--------- --------- ---------
Increase in net assets from capital
transactions ............................. 17,131,238 8,393,703 3,896,054
---------- --------- ---------
Increase in net assets .................... 18,708,594 9,328,432 4,217,854
Net assets at beginning of period ......... 14,336,751 5,008,319 790,465
---------- --------- ---------
33,045,345 14,336,751 5,008,319
========== ========== =========
</TABLE>
A-40
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
--------------------------------------------------------------------------
CAPITAL
INTERNATIONAL GROWTH PORTFOLIO APPRECIATION PORTFOLIO
--------------------------------------------- ----------------------------
PERIOD FROM PERIOD FROM
MAY 3, YEAR MAY 2,
1996 TO ENDED 1997 TO
YEAR ENDED DECEMBER 31 DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996 1998 1997
--------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income (expense) .................... $ 453,555 (167,651) 9,055 (129,163) (1,544)
Net realized gain .................................. 7,205,182 3,329,942 187,391 336,728 31,894
Unrealized appreciation on investments ............. 1,486,427 1,235,644 586,615 7,532,890 12,182
------------ --------- ------- --------- ------
Increase in net assets from operations ............. 9,145,164 4,397,935 783,061 7,740,455 42,532
------------ --------- ------- --------- ------
Net premiums ....................................... 7,538,624 19,031,016 4,654,797 8,764,540 720,613
Transfers (to) from the general account of
Life of Virginia:
Death benefits ................................... (372,667) (197,552) -- (52,380) --
Surrenders ....................................... (2,368,354) (1,293,141) (51,116) (765,563) (37,177)
Administrative expense (note 3) .................. (70,684) (39,068) (3,441) (11,745) (826)
Transfer gain (loss) and transfer fees ........... 74,891 24,476 3,766 485,206 (33,752)
Transfer (to) from the Guarantee Account
(note 1) ......................................... 10,288,178 8,279,728 935,954 4,797,081 446,414
Interfund transfers ................................ (1,419,705) 10,950,154 7,189,157 15,456,302 1,531,771
------------ ---------- --------- ---------- ---------
Increase in net assets from capital transactions .... 13,670,283 36,755,613 12,729,117 28,673,441 2,627,043
------------ ---------- ---------- ---------- ---------
Increase in net assets .............................. 22,815,447 41,153,548 13,512,178 36,413,896 2,669,575
Net assets at beginning of period ................... 54,665,726 13,512,178 -- 2,669,575 --
------------ ---------- ---------- ---------- ---------
$ 77,481,173 54,665,726 13,512,178 39,083,471 2,669,575
============ ========== ========== ========== =========
</TABLE>
A-41
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
STATEMENTS OF CHANGES IN NET ASSETS, CONTINUED
DECEMBER 31, 1998
<TABLE>
<CAPTION>
GOLDMAN SACHS SALOMON BROTHERS
VARIABLE INSURANCE VARIABLE SERIES
TRUST FUND FUND
----------------------------- -------------------------------------------
GROWTH AND MID CAP STRATEGIC TOTAL
INCOME EQUITY BOND INVESTORS RETURN
FUND FUND FUND FUND FUND
-------------- -------------- -------------- -------------- -------------
PERIOD FROM PERIOD FROM PERIOD FROM PERIOD FROM PERIOD FROM
MAY 12, MAY 8, OCTOBER 22, NOVEMBER 27, OCTOBER 30,
1998 TO 1998 TO 1998 TO 1998 TO 1998 TO
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1998 1998 1998 1998
-------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net assets
From operations:
Net investment income ............................... $ 20,010 12,176 5,857 40 5,798
Net realized gain (loss) ............................ (32,043) (72,641) 322 -- 1
Unrealized appreciation (depreciation) on
investments ....................................... 40,081 12,789 (4,823) 321 (2,958)
---------- ------- ------ ---- ------
Increase (decrease) in net assets from operations..... 28,048 (47,676) 1,356 361 2,841
---------- ------- ------ ---- ------
From capital transactions:
Net premiums ........................................ 1,873,044 1,653,452 19,355 9,900 168,401
Transfers (to) from the general account of
Life of Virginia:
Death benefits ....................................
Surrenders ........................................ (42,593) (42,773) -- -- (16)
Administrative expense (note 3) ................... (447) (527) (17) (3) --
Transfer gain (loss) and transfer fees ............ 89,687 (48,872) (48) 123 140
Transfer (to) from the Guarantee Account
(note 1) .......................................... 1,085,095 1,327,515 14,903 606 14,269
Interfund transfers ................................. 1,229,734 782,072 96,473 -- 158,086
---------- --------- ------ ------- -------
Increase in net assets from capital transactions ..... 4,234,520 3,670,867 130,666 10,626 340,880
---------- --------- ------- ------- -------
Increase in net assets ............................... 4,262,568 3,623,191 132,022 10,987 343,721
Net assets at beginning of period .................... -- -- -- -- --
---------- --------- ------- ------- -------
Net assets at end of period .......................... $4,262,568 3,623,191 132,022 10,987 343,721
========== ========= ======= ======= =======
</TABLE>
See accompanying notes to financial statements.
A-42
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
(1) DESCRIPTION OF ENTITY
Life of Virginia Separate Account 4 is a separate investment account
established in 1987 by The Life Insurance Company of Virginia (Life of
Virginia) under the laws of the Commonwealth of Virginia. The Account operates
as a unit investment trust under the Investment Company Act of 1940. The
Account is used to fund certain benefits for flexible premium variable deferred
annuity life insurance policies issued by Life of Virginia. The Life Insurance
Company of Virginia is a stock life insurance company operating under a charter
granted by the Commonwealth of Virginia on March 21, 1871. Eighty percent of
the capital stock of Life of Virginia is owned by General Electric Capital
Assurance Company. The remaining 20% is owned by GE Financial Assurance
Holdings, Inc. General Electric Capital Assurance Company and GE Financial
Assurance Holdings, Inc. are indirect, wholly-owned subsidiaries of General
Electric Capital ("GE Capital"). GE Capital, a diversified financial services
company, is a wholly-owned subsidiary of General Electric Company (GE), a New
York corporation. Prior to April 1, 1996, Life of Virginia was an indirect
wholly-owned subsidiary of Aon Corporation (Aon).
In October 1998, three new investment subdivisions were added to the
Account for both Type I and Type II policies (see note 2). The Investors Fund,
Strategic Bond Fund, and the Total Return Fund each invest solely in a
designated portfolio of the Salomon Brothers Variable Series Fund. All
designated portfolios described above are series type mutual funds.
In May 1998, three new investment subdivisions were added to the Account,
for both Type I and Type II policies. The U.S. Equity Fund invests solely in a
designated portfolio of the GE Investments Funds, Inc. The Mid Cap Equity and
Growth and Income Funds each invest solely in a designated portfolio of the
Goldman Sachs Variable Insurance Trust Fund. All designated portfolios
described above are series type mutual funds.
In May 1997, seven new investment subdivisions were added to the Account,
for both Type I and II policies. The Growth & Income Portfolio and Growth
Opportunities Portfolio each invest solely in a designated portfolio of the
Variable Insurance Products Fund III. The Global Income Fund and the Value
Equity Fund each invest solely in a designated portfolio of the GE Investments
Funds, Inc. The Capital Appreciation Portfolio invests solely in a designated
portfolio of the Janus Aspen Series. The Growth II Portfolio and the Large Cap
Growth Portfolio each invest solely in a designated portfolio of the PBHG
Insurance Series Fund. All designated portfolios described above are series
type mutual funds.
On December 12, 1997, the Account added the GE Investments Funds, Inc. --
Income Fund as a new investment subdivision and made the following
substitutions of shares held by the investment subdivisions:
<TABLE>
<CAPTION>
BEFORE THE SUBSTITUTION AFTER THE SUBSTITUTION
<S> <C>
Shares of Money Market Portfolio -- Variable Shares of Money Market Fund -- GE Investments
Insurance Products Fund Funds, Inc.
Shares of Money Fund -- Oppenheimer Variable Shares of Money Market Fund -- GE Investments
Account Funds Funds, Inc.
Shares of Bond Portfolio -- Neuberger & Berman Shares of Income Fund -- GE Investments Funds, Inc.
Advisers Management Trust
Shares of High Income Portfolio -- Variable Shares of High Income Fund -- Oppenheimer Variable
Insurance Products Fund Account Funds
Shares of Growth Portfolio -- Neuberger & Berman Shares of Growth Portfolio -- Variable Insurance
Advisers Management Trust Products Fund
Shares of Balanced Portfolio -- Neuberger & Shares of Balanced Portfolio -- Janus Aspen Series
Berman Advisers Management Trust
</TABLE>
The foregoing substitutions were carried out pursuant to an order of the
Securities and Exchange Commission (Commission) issued on December 11, 1997,
with the approval of any necessary department of insurance. The effect of such
a share substitution was to replace certain portfolios of Variable Insurance
Products Fund, Oppenheimer Variable Account Funds, GE Investments Funds, Inc.,
and Neuberger & Berman Advisers Management Trust with those of GE Investments
Funds, Inc., Oppenheimer Variable Account Funds, Variable Insurance Products
Fund, and Janus Aspen Series.
In May 1996, two new investment subdivisions were added to the Account,
for both Type I and II policies. One of these subdivisions, the International
Growth Portfolio, invests solely in a designated portfolio of the Janus Aspen
Series, a
A-43
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(1) DESCRIPTION OF ENTITY -- Continued
series type mutual fund. The other new subdivision, the American Leaders Fund
II, invests solely in a designated portfolio of the Federated Investors
Insurance Series, a series type mutual fund.
Policyowners may transfer cash values between the Account's portfolios and
the Guarantee Account that is part of the general account of Life of Virginia.
Amounts transferred to the Guarantee Account earn interest at the interest rate
in effect at the time of such transfer and remain in effect for one year, after
which a new rate may be declared.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) UNIT CLASSES
There are two unit classes included in the Account. Type I units are sold
under policy form P1140 and P1141. Type II units are sold under policy forms
P1142, P1142N and P1143. Type II unit sales began in the third quarter of 1994.
Effective on or after February 2, 1999 Type III units will be sold under policy
form P1152.
(B) INVESTMENTS
Investments are stated at fair value which is based on the underlying net
asset value per share of the respective portfolios or funds. Purchases and
sales of investments are recorded on the trade date and income distributions
are recorded on the ex-dividend date. Realized gains and losses on investments
are determined on the average cost basis. The units and unit values are
disclosed as of the last business day in the applicable year or period.
The aggregate cost of investments acquired and the aggregate proceeds of
investments sold, for the year or period ended December 31, 1998 were:
<TABLE>
<CAPTION>
COST OF PROCEEDS
SHARES FROM
FUND/PORTFOLIO ACQUIRED SHARES SOLD
- ------------------------------------- ---------------- ----------------
<S> <C> <C>
GE Investment Funds, Inc.:
S&P 500 Index ..................... $ 193,261,666 83,496,621
Money Market ...................... 1,701,557,815 1,613,202,928
Total Return ...................... 26,506,347 10,123,616
International Equity .............. 18,787,547 16,652,515
Real Estate Securities ............ 23,523,854 15,842,661
Global Income ..................... 5,328,295 1,861,939
Value Equity ...................... 36,535,340 13,367,625
Income ............................ 22,275,922 10,257,184
U.S. Equity ....................... 2,590,882 619,346
Oppenheimer Variable Account Funds:
Bond .............................. 39,193,414 18,132,323
Capital Appreciation .............. 210,297,462 219,809,641
Growth ............................ 181,186,893 150,922,416
High Income ....................... 83,189,744 59,635,187
Multiple Strategies ............... 26,261,850 18,472,877
Variable Insurance Products Fund:
Equity-Income ..................... 313,726,699 264,067,806
Growth ............................ 108,443,495 81,040,342
Overseas .......................... 438,953,070 443,302,750
Variable Insurance Products Fund II:
Asset Manager ..................... 113,236,992 104,285,552
Contrafund ........................ 117,285,371 77,197,982
</TABLE>
A-44
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
COST OF PROCEEDS
SHARES FROM
FUND/PORTFOLIO ACQUIRED SHARES SOLD
- --------------------------------------------- -------------- --------------
<S> <C> <C>
Variable Insurance Products Fund III:
Growth & Income ........................... $ 50,925,747 $ 18,711,891
Growth Opportunities ...................... 37,316,604 8,146,041
Federated Insurance Series:
American Leaders Fund II .................. 54,772,449 20,590,197
High Income Bond Fund II .................. 58,149,198 41,800,853
Utility Fund II ........................... 24,432,674 11,930,573
The Alger American Fund:
Small Cap ................................. 201,507,490 183,477,163
Growth .................................... 71,107,311 36,713,398
PBHG Insurance Series Fund, Inc.:
PBHG Large Cap Growth ..................... 9,540,607 4,578,565
PBHG Growth II ............................ 9,729,001 6,287,519
Janus Aspen Series:
Aggressive Growth ......................... 84,770,544 91,715,895
Growth .................................... 93,618,465 50,237,631
Worldwide Growth .......................... 300,106,080 221,933,327
Balanced .................................. 93,484,668 29,012,283
Flexible Income ........................... 27,608,056 9,290,765
International Growth ...................... 173,185,303 162,321,859
Capital Appreciation ...................... 38,542,550 10,997,547
Goldman Sachs Variable Insurance Trust Fund:
Growth and Income ......................... 4,676,147 481,640
Mid Cap Equity ............................ 5,145,437 1,409,093
Salomon Brothers Variable Series Fund:
Strategic Bond ............................ 210,700 80,107
Investors ................................. 10,629 3
Total Return .............................. 341,040 171
</TABLE>
A-45
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
(C) CAPITAL TRANSACTIONS
The increase (decrease) in outstanding units for Type I and Type II from
capital transactions for the years or periods ended December 31, 1998, 1997 and
1996 are as follows:
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC.
---------------------------------------------------------------------
S&P 500 GOVERNMENT MONEY TOTAL INTERNATIONAL
INDEX SECURITIES MARKET RETURN EQUITY
FUND FUND FUND FUND FUND
TYPE I UNITS ------------- ------------ --------------- ----------- --------------
<S> <C> <C> <C> <C> <C>
Units outstanding at December 31, 1995 .................... 479,021 428,950 893,974 745,501 115,562
------- ------- ------- ------- -------
Net premiums ............................................. 34,082 36,100 706,581 33,745 22,527
Transfers (to) from the general account of Life
of Virginia:
Death benefits ......................................... (1,231) (163) (16,043) (6,096) --
Surrenders ............................................. (22,370) (25,884) (412,885) (31,853) (5,008)
Administrative expenses ................................ (1,347) (1,204) (4,925) (2,175) (446)
Transfers (to)/from the Guarantee Account ................ 37,400 4,534 358,505 1,905 22,249
Interfund transfers ...................................... 54,702 62,264 1,023,952 (32,962) 52,528
------- ------- --------- ------- -------
Net increase (decrease) in units from capital transactions 101,236 75,647 1,655,185 (37,436) 91,850
------- ------- --------- ------- -------
Units outstanding at December 31, 1996 .................... 580,257 504,597 2,549,159 708,065 207,412
------- ------- --------- ------- -------
Net premiums ............................................. 43,467 2,027 273,183 24,404 3,946
Transfers (to) from the general account of Life
of Virginia:
Death benefits ......................................... (2,505) (3,654) (88,771) (5,480) --
Surrenders ............................................. (34,875) (27,521) (773,658) (56,645) (12,742)
Administrative expenses ................................ (1,886) (938) (6,382) (1,805) (522)
Transfers (to)/from the Guarantee Account ................ 41,669 9,540 304,035 5,882 18,965
Interfund transfers ...................................... 292,720 (484,051) 1,254,694 (42,593) (35,529)
------- -------- --------- ------- -------
Net increase (decrease) in units from capital transactions 338,590 (504,597) 963,101 (76,237) (25,882)
------- -------- --------- ------- -------
Units outstanding at December 31, 1997 .................... 918,847 -- 3,512,260 631,828 181,530
------- -------- --------- ------- -------
Net premiums ............................................. 43,692 -- 3,088,601 8,156 37,608
Transfers (to) from the general account of Life
of Virginia:
Death benefits ......................................... (4,853) -- (89,832) (2,466) (463)
Surrenders ............................................. (75,788) -- (2,689,646) (56,739) (24,253)
Cost of insurance ...................................... (2,222) -- (13,914) (1,299) (767)
Transfers (to) from the Guarantee Account ................ 44,702 -- 269,329 8,553 14,103
Interfund transfers ...................................... 172,435 -- 1,145,551 (3,122) (46,225)
------- -------- ---------- ------- -------
Net increase (decrease) in units from capital transactions 177,966 -- 1,710,089 (46,917) (19,997)
------- -------- ---------- ------- -------
Units outstanding at December 31, 1998 .................... 1,096,813 -- 5,222,349 584,911 161,533
========= ======== ========== ======= =======
</TABLE>
A-46
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC. (CONTINUED)
---------------------------------------------------------------
REAL ESTATE GLOBAL U.S.
SECURITIES INCOME VALUE EQUITY INCOME EQUITY
FUND FUND FUND FUND FUND
TYPE I UNITS ------------- ---------- -------------- ------------- ---------
<S> <C> <C> <C> <C> <C>
Units outstanding at December 31, 1995 ...................... 23,643 -- -- -- --
------ -- -- -- --
Net premiums ............................................... 14,587 -- -- -- --
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... -- -- -- -- --
Surrenders ............................................... (1,361) -- -- -- --
Administrative expenses .................................. (192) -- -- -- --
Transfers (to)/from the Guarantee Account .................. 21,124 -- -- -- --
Interfund transfers ........................................ 147,118 -- -- -- --
------- -- -- -- --
Net increase (decrease) in units from capital transactions .. 181,276 -- -- -- --
------- -- -- -- --
Units outstanding at December 31, 1996 ...................... 204,919 -- -- -- --
------- -- -- -- --
Net premiums ............................................... 27,070 392 11,097 595 --
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... -- -- -- -- --
Surrenders ............................................... (14,199) (72) (731) (5,500) --
Administrative expenses .................................. (719) (12) (128) (199) --
Transfers (to)/from the Guarantee Account .................. 26,266 3,303 12,467 -- --
Interfund transfers ........................................ 110,113 9,339 154,506 1,300,742 --
------- ----- ------- --------- --
Net increase (decrease) in units from capital transactions .. 148,531 12,950 177,211 1,295,638 --
------- ------ ------- --------- --
Units outstanding at December 31, 1997 ...................... 353,450 12,950 177,211 1,295,638 --
------- ------ ------- --------- --
Net premiums ............................................... 139,356 3,542 73,340 14,672 2,951
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... (1,816) -- (261) (5,419) --
Surrenders ............................................... (85,757) (3,547) (33,659) (93,554) (67)
Cost of insurance ........................................ (3,200) (80) (1,036) (1,780) (24)
Transfers (to) from the Guarantee Account .................. 112,800 8,901 54,595 34,085 660
Interfund transfers ........................................ (198,141) 24,866 115,186 89,003 22,607
-------- ------ ------- --------- ------
Net increase (decrease) in units from capital transactions .. (36,758) 33,682 208,165 37,007 26,127
-------- ------ ------- --------- ------
Units outstanding at December 31, 1998 ...................... 316,692 46,632 385,376 1,332,645 26,127
======== ====== ======= ========= ======
</TABLE>
A-47
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
----------------------------------------
CAPITAL
MONEY BOND APPRECIATION
FUND FUND FUND
TYPE I UNITS ------------ ------------ --------------
<S> <C> <C> <C>
Units outstanding at December 31, 1995 .......... 282,462 952,700 2,647,993
------- ------- ---------
Net premiums ................................... -- (4,744) (181,755)
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (1,782) 2,016 44,441
Surrenders ................................... (16,283) 7,728 332,700
Administrative expenses ...................... (531) 407 14,718
Transfers (to)/from the Guarantee Account ...... (4,896) (7,110) (185,173)
Interfund transfers ............................ (96,465) (9,728) 53,131
------- ------- ---------
Net increase (decrease) in units from capital
transactions ................................... (119,957) (11,431) 78,062
-------- ------- ---------
Units outstanding at December 31, 1996 .......... 162,505 941,269 2,726,055
-------- ------- ---------
Net premiums ................................... -- 12,729 48,378
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... -- (4,708) (2,476)
Surrenders ................................... -- (114,775) (146,760)
Administrative expenses ...................... (298) (2,868) (6,721)
Transfers (to)/from the Guarantee Account ...... -- 30,993 33,837
Interfund transfers ............................ (156,841) 66,990 (60,894)
-------- -------- ---------
Net increase (decrease) in units from capital
transactions ................................... (157,139) (11,639) (134,636)
-------- -------- ---------
Units outstanding at December 31, 1997 .......... -- 929,630 2,591,419
-------- -------- ---------
Net premiums ................................... 74,703 19,338
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... -- (15,395) (5,238)
Surrenders ................................... -- (407,204) (170,429)
Cost of insurance ............................ -- (5,618) (5,190)
Transfers (to) from the Guarantee Account ...... -- 81,767 15,924
Interfund transfers ............................ -- 257,976 (101,296)
-------- -------- ---------
Net increase (decrease) in units from capital
transactions ................................... -- (13,771) (246,891)
-------- -------- ---------
Units outstanding at December 31, 1998 .......... -- 915,859 2,344,528
======== ======== =========
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
-----------------------------------------
HIGH MULTIPLE
GROWTH INCOME STRATEGIES
FUND FUND FUND
TYPE I UNITS ------------- ------------- -------------
<S> <C> <C> <C>
Units outstanding at December 31, 1995 .......... 986,685 1,263,712 1,762,762
------- --------- ---------
Net premiums ................................... 267,359 15,693 26,028
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (29,174) (411) (15,299)
Surrenders ................................... (364,042) (23,047) (88,160)
Administrative expenses ...................... (16,121) (1,163) (4,615)
Transfers (to)/from the Guarantee Account ...... 105,286 13,792 26,304
Interfund transfers ............................ 240,629 89,651 (66,358)
-------- --------- ---------
Net increase (decrease) in units from capital
transactions ................................... 203,937 94,515 (122,100)
-------- --------- ---------
Units outstanding at December 31, 1996 .......... 1,190,622 1,358,227 1,640,662
--------- --------- ---------
Net premiums ................................... 50,650 44,846 26,455
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (1,990) (6,846) (7,589)
Surrenders ................................... (99,247) (87,976) (127,118)
Administrative expenses ...................... (2,955) (3,299) (4,137)
Transfers (to)/from the Guarantee Account ...... 40,477 54,141 17,555
Interfund transfers ............................ 114,256 510,750 7,721
--------- --------- ---------
Net increase (decrease) in units from capital
transactions ................................... 101,191 511,616 (87,113)
--------- --------- ---------
Units outstanding at December 31, 1997 .......... 1,291,813 1,869,843 1,553,549
--------- --------- ---------
Net premiums ................................... 34,584 31,959 40,822
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (2,748) (10,837) (8,380)
Surrenders ................................... (110,751) (182,095) (161,263)
Cost of insurance ............................ (2,659) (4,385) (3,584)
Transfers (to) from the Guarantee Account ...... 19,698 51,660 19,533
Interfund transfers ............................ (56,877) (97,711) (96,211)
--------- --------- ---------
Net increase (decrease) in units from capital
transactions ................................... (118,753) (211,409) (209,083)
--------- --------- ---------
Units outstanding at December 31, 1998 .......... 1,173,060 1,658,434 1,344,466
========= ========= =========
</TABLE>
A-48
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
------------------------------------------------------------------------
MONEY HIGH
MARKET INCOME EQUITY-INCOME GROWTH OVERSEAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
TYPE I UNITS --------------- ------------- --------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Units outstanding at December 31, 1995 ................ 2,433,065 958,295 6,942,107 5,187,186 4,508,746
--------- ------- --------- --------- ---------
Net premiums ......................................... 8,114 (11,013) 209,607 133,676 102,472
Transfers (to) from the general account of Life of
Virginia:
Death benefits ..................................... (26,867) -- (39,084) (25,152) (17,537)
Surrenders ......................................... (136,342) (64,247) (314,228) (232,300) (188,428)
Administrative expenses ............................ (4,247) (2,193) (16,695) (13,593) (11,116)
Transfers (to)/from the Guarantee Account ............ (46,251) (1,584) 129,570 60,757 48,453
Interfund transfers .................................. (1,024,299) (147,328) (63,823) (278,909) (373,467)
---------- -------- --------- --------- ---------
Net increase (decrease) in units from capital
transactions ......................................... (1,229,892) (226,365) (94,653) (355,521) (439,623)
---------- -------- --------- --------- ---------
Units outstanding at December 31, 1996 ................ 1,203,173 731,930 6,847,454 4,831,665 4,069,123
---------- -------- --------- --------- ---------
Net premiums ......................................... (2,769) -- 132,909 46,481 33,637
Transfers (to) from the general account of Life of
Virginia:
Death benefits ..................................... (3,458) (2,224) (25,251) (14,556) (15,035)
Surrenders ......................................... (72,594) (65,456) (376,813) (325,620) (189,716)
Administrative expenses ............................ (2,380) (1,503) (17,119) (12,146) (9,227)
Transfers (to)/from the Guarantee Account ............ (1,822) (257) 81,689 26,348 10,283
Interfund transfers .................................. (1,110,150) (662,490) (53,531) (84,347) (500,805)
---------- -------- --------- --------- ---------
Net increase (decrease) in units from capital
transactions ......................................... (1,193,173) (731,930) (258,116) (363,840) (670,863)
---------- -------- --------- --------- ---------
Units outstanding at December 31, 1997 ................ -- -- 6,589,338 4,467,825 3,398,260
---------- -------- --------- --------- ---------
Net premiums ......................................... -- -- 92,608 28,017 20,092
Transfers (to) from the general account of Life of
Virginia:
Death benefits ..................................... -- -- (21,942) (20,703) (8,411)
Surrenders ......................................... -- -- (584,254) (406,572) (201,390)
Cost of insurance .................................. -- -- (14,640) (9,624) (6,558)
Transfers (to) from the Guarantee Account ............ -- -- 51,832 6,585 16,016
Interfund transfers .................................. -- -- (359,182) (96,107) (404,695)
---------- -------- --------- --------- ---------
Net increase (decrease) in units from capital
transactions ......................................... -- -- (835,578) (498,404) (584,946)
---------- -------- --------- --------- ---------
Units outstanding at December 31, 1998 ................ -- -- 5,753,760 3,969,421 2,813,314
========== ======== ========= ========= =========
</TABLE>
A-49
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS VARIABLE INSURANCE PRODUCTS
FUND II FUND III
------------------------------- ----------------------------
ASSET GROWTH & GROWTH
MANAGER CONTRAFUND INCOME OPPORTUNITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
TYPE I UNITS --------------- ------------- ----------- --------------
<S> <C> <C> <C> <C>
Units outstanding at December 31, 1995 ............. 21,993,362 2,434,885 -- --
---------- --------- -- --
Net premiums ...................................... 164,394 191,853 -- --
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (142,857) (14,740) -- --
Surrenders ...................................... (1,189,857) (156,723) -- --
Administrative expenses ......................... (60,017) (7,215) -- --
Transfers (to)/from the Guarantee Account ......... (9,338) 168,994 -- --
Interfund transfers ............................... (1,775,712) 480,447 -- --
---------- --------- -- --
Net increase (decrease) in units from capital
transactions ...................................... (3,013,387) 662,616 -- --
---------- --------- -- --
Units outstanding at December 31, 1996 ............. 18,979,975 3,097,501 -- --
---------- --------- -- --
Net premiums ...................................... 152,156 110,477 41,831 30,072
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (89,850) (9,932) -- --
Surrenders ...................................... (1,096,143) (211,184) (813) (5,989)
Administrative expenses ......................... (52,182) (7,854) (183) (318)
Transfers (to)/from the Guarantee Account ......... 25,895 101,581 19,562 24,545
Interfund transfers ............................... (818,341) 215,612 233,932 293,107
---------- --------- ------- -------
Net increase (decrease) in units from capital
transactions ...................................... (1,878,465) 198,700 294,329 341,417
---------- --------- ------- -------
Units outstanding at December 31, 1997 ............. 17,101,510 3,296,201 294,329 341,417
---------- --------- ------- -------
Net premiums ...................................... 71,298 74,775 36,361 51,350
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (86,711) (3,720)
Surrenders ...................................... (1,581,072) (275,339) (33,956) (51,341)
Cost of insurance ............................... (41,759) (6,747) (1,229) (1,181)
Transfers (to) from the Guarantee Account ......... 16,975 48,507 44,357 39,391
Interfund transfers ............................... (645,083) (51,589) 411,418 215,578
---------- --------- ------- -------
Net increase (decrease) in units from capital
transactions ...................................... (2,266,352) (214,113) 456,951 253,797
---------- --------- ------- -------
Units outstanding at December 31, 1998 ............. 14,835,158 3,082,088 751,280 595,214
========== ========= ======= =======
</TABLE>
A-50
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
ADVISERS
MANAGEMENT TRUST (CONTINUED)
-------------------------------------------
BALANCED BOND GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
TYPE I UNITS --------------- ------------- -------------
<S> <C> <C> <C>
Units outstanding at December 31, 1995 ......... 2,025,936 939,243 756,501
--------- ------- -------
Net premiums .................................. -- 692 --
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. (13,542) (625) (7,106)
Surrenders .................................. (19,441) (46,729) (82,100)
Administrative expenses ..................... (1,491) (2,782) (3,304)
Transfers (to)/from the Guarantee
Account ..................................... (6,661) (1,863) (1,563)
Interfund transfers ........................... (300,225) (348,334) (131,122)
-------- --------
Net increase (decrease) in units from
capital transactions .......................... (341,360) (399,641) (225,195)
-------- --------
Units outstanding at December 31, 1996 ......... 1,684,576 539,602 531,306
--------- -------- --------
Net premiums .................................. (343) 141 348
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. (4,573) (13,722) (3,133)
Surrenders .................................. (131,590) (27,704) (10,160)
Administrative expenses ..................... (3,702) (1,043) (1,125)
Transfers (to)/from the Guarantee
Account ..................................... (9,256) (144) --
Interfund transfers ........................... 1,535,112) (497,130) (517,236)
-------- --------
Net increase (decrease) in units from
capital transactions .......................... (1,684,576) (539,602) (531,306)
-------- --------
Units outstanding at December 31, 1997 ......... -- -- --
---------- -------- --------
Net premiums .................................. -- -- --
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. -- -- --
Surrenders .................................. -- -- --
Cost of insurance ........................... -- -- --
Transfers (to) from the Guarantee
Account ..................................... -- -- --
Interfund transfers ........................... -- -- --
---------- -------- --------
Net increase (decrease) in units from
capital transactions .......................... -- -- --
---------- -------- --------
Units outstanding at December 31, 1998 ......... -- -- --
========== ======== ========
<CAPTION>
FEDERATED INVESTORS
INSURANCE SERIES
----------------------------------------
AMERICAN
LEADERS HIGH
PORTFOLIO INCOME UTILITY
FUND II BONDS FUND II FUND II
TYPE I UNITS ----------- --------------- ------------
<S> <C> <C> <C>
Units outstanding at December 31, 1995 ......... -- 40,814 539,628
-- ------ -------
Net premiums .................................. 6,132 11,997 34,892
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. -- (1,489) (13,689)
Surrenders .................................. (234) (8,472) (35,752)
Administrative expenses ..................... (47) (273) (1,868)
Transfers (to)/from the Guarantee
Account ..................................... 1,547 23,451 31,866
Interfund transfers ........................... 68,264 145,478 (9,854)
------ ------- -------
Net increase (decrease) in units from
capital transactions .......................... 75,662 170,692 5,595
------ ------- -------
Units outstanding at December 31, 1996 ......... 75,662 211,506 545,223
------ ------- -------
Net premiums .................................. 35,396 49,848 7,670
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. -- (469) (853)
Surrenders .................................. (1,961) (14,353) (38,555)
Administrative expenses ..................... (502) (718) (1,375)
Transfers (to)/from the Guarantee
Account ..................................... 24,074 50,940 9,699
Interfund transfers ........................... 228,950 159,370 (36,477)
------- ------- -------
Net increase (decrease) in units from
capital transactions .......................... 285,957 244,618 (59,891)
------- ------- -------
Units outstanding at December 31, 1997 ......... 361,619 456,124 485,332
------- ------- -------
Net premiums .................................. 49,226 (16,663) (2,080)
Transfers (to) from the general account
of Life of Virginia:
Death benefits .............................. -- 1,444 816
Surrenders .................................. (38,733) 22,376 6,445
Cost of insurance ........................... (1,089) 466 179
Transfers (to) from the Guarantee
Account ..................................... 23,362 (25,648) (2,909)
Interfund transfers ........................... 86,081 33,576 (9,318)
------- ------- -------
Net increase (decrease) in units from
capital transactions .......................... 118,847 15,551 (6,867)
------- ------- -------
Units outstanding at December 31, 1998 ......... 480,466 471,675 478,465
======= ======= =======
</TABLE>
A-51
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
ALGER AMERICAN
-----------------------------
SMALL CAP GROWTH
PORTFOLIO PORTFOLIO
TYPE I UNITS --------------- -------------
<S> <C> <C>
Units outstanding at December 31, 1995 ......... 405,791 261,225
------- -------
Net premiums .................................. 260,309 140,387
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. (10,458) --
Surrenders .................................. (35,446) (31,027)
Administrative expenses ..................... (2,659) (2,129)
Transfers (to)/from the Guarantee Account ..... 150,713 122,150
Interfund transfers ........................... 571,403 700,068
------- -------
Net increase (decrease) in units from capital
transactions .................................. 933,862 929,449
------- -------
Units outstanding at December 31, 1996 ......... 1,339,653 1,190,674
--------- ---------
Net premiums .................................. 694,521 66,490
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. (42,319) (2,907)
Surrenders .................................. (1,148,701) (80,029)
Administrative expenses ..................... (36,907) (3,546)
Transfers (to)/from the Guarantee Account ..... 749,029 2,066
Interfund transfers ........................... (230,206) (150,234)
---------- ---------
Net increase (decrease) in units from capital
transactions .................................. (14,583) (168,160)
---------- ---------
Units outstanding at December 31, 1997 ......... 1,325,070 1,022,514
---------- ---------
Net premiums .................................. 429,477 25,796
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. (384) (6,748)
Surrenders .................................. (28,813) (101,948)
Cost of insurance ........................... (1,249) (2,260)
Transfers (to) from the Guarantee Account ..... 27,106 20,996
Interfund transfers ........................... (17,778) 203,074
---------- ---------
Net increase (decrease) in units from capital
transactions .................................. 408,359 138,910
---------- ---------
Units outstanding at December 31, 1998 ......... 1,733,429 1,161,424
========== =========
<CAPTION>
PBHG INSURANCE
SERIES FUND JANUS ASPEN SERIES
----------------------- -----------------------------
LARGE CAP AGGRESSIVE
GROWTH GROWTH II GROWTH GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
TYPE I UNITS ----------- ----------- ------------- ---------------
<S> <C> <C> <C> <C>
Units outstanding at December 31, 1995 ......... -- -- 1,965,737 4,432,726
-- -- --------- ---------
Net premiums .................................. -- -- 1,581 1,661,740
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. -- -- -- (181,059)
Surrenders .................................. -- -- (429) (2,320,448)
Administrative expenses ..................... -- -- (22) (113,310)
Transfers (to)/from the Guarantee Account ..... -- -- 1,256 1,066,999
Interfund transfers ........................... -- -- 7,695 217,761
-- -- --------- ----------
Net increase (decrease) in units from capital
transactions .................................. -- -- 10,081 331,683
-- -- --------- ----------
Units outstanding at December 31, 1996 ......... -- -- 1,975,818 4,764,409
-- -- --------- ----------
Net premiums .................................. 1,019 17,111 55,368 109,351
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. -- -- (1,972) (66,404)
Surrenders .................................. (92) (49) (87,614) (321,901)
Administrative expenses ..................... (32) (101) (4,772) (11,195)
Transfers (to)/from the Guarantee Account ..... 2,432 1,623 29,407 64,006
Interfund transfers ........................... 52,670 58,027 (148,659) (32,501)
------ ------ --------- ----------
Net increase (decrease) in units from capital
transactions .................................. 55,997 76,611 (158,242) (258,644)
------ ------ --------- ----------
Units outstanding at December 31, 1997 ......... 55,997 76,611 1,817,576 4,505,765
------ ------ --------- ----------
Net premiums .................................. 12,832 43,391 16,545 85,570
Transfers (to) from the general account of
Life of Virginia:
Death benefits .............................. -- -- (8,425) (16,960)
Surrenders .................................. (13,525) (2,223) (137,584) (306,115)
Cost of insurance ........................... (192) (222) (3,687) (10,854)
Transfers (to) from the Guarantee Account ..... 8,053 7,385 13,161 60,329
Interfund transfers ........................... 34,878 (2,510) (145,916) (10,306)
------- ------ --------- ----------
Net increase (decrease) in units from capital
transactions .................................. 42,046 45,821 (265,906) (198,336)
------- ------ --------- ----------
Units outstanding at December 31, 1998 ......... 98,043 122,432 1,551,670 4,307,429
======= ======= ========= ==========
</TABLE>
A-52
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
JANUS ASPEN SERIES (CONTINUED)
---------------------------------------------------------------------
FLEXIBLE INTERNATIONAL CAPITAL
WORLDWIDE BALANCED INCOME GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
TYPE I UNITS ------------- ------------- ----------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Units outstanding at December 31, 1995 ............. 2,757,216 111,972 39,079 -- --
--------- ------- ------ -- --
Net premiums ...................................... 880,684 49,343 4,021 34,924 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (51,566) (2,953) -- -- --
Surrenders ...................................... (739,842) (15,986) (1,075) (1,689) --
Administrative expenses ......................... (48,025) (1,541) (194) (301) --
Transfers (to)/from the Guarantee Account ......... 455,640 26,519 11,223 37,626 --
Interfund transfers ............................... 916,700 191,453 64,966 403,878 --
--------- ------- ------ ------- --
Net increase (decrease) in units from capital
transactions ...................................... 1,413,591 246,835 78,941 474,438 --
--------- ------- ------ ------- --
Units outstanding at December 31, 1996 ............. 4,170,807 358,807 118,020 474,438 --
--------- ------- ------- ------- --
Net premiums ...................................... 257,478 32,492 8,506 99,898 2,452
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (7,323) -- -- -- --
Surrenders ...................................... (229,991) (34,024) (17,779) (40,170) (1,327)
Administrative expenses ......................... (12,079) (1,430) (403) (2,200) (58)
Transfers (to)/from the Guarantee Account ......... 148,276 55,427 78,205 64,693 344
Interfund transfers ............................... 611,104 2,070,280 94,329 408,010 47,846
--------- --------- ------- ------- ------
Net increase (decrease) in units from capital
transactions ...................................... 767,465 2,122,745 162,858 530,231 49,257
--------- --------- ------- ------- ------
Units outstanding at December 31, 1997 ............. 4,938,272 2,481,552 280,878 1,004,669 49,257
--------- --------- ------- --------- ------
Net premiums ...................................... 235,218 127,113 37,137 55,993 124,428
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. (17,077) (16,246) (1,939) (2,564) --
Surrenders ...................................... (371,035) (424,576) (20,362) (67,352) (9,789)
Cost of insurance ............................... (11,204) (6,797) (928) (2,002) (416)
Transfers (to) from the Guarantee Account ......... 69,943 102,984 62,318 28,874 11,707
Interfund transfers ............................... 50,630 652,003 195,121 35,806 331,630
--------- --------- ------- --------- -------
Net increase (decrease) in units from capital
transactions ...................................... (43,525) 434,481 271,347 48,755 457,560
--------- --------- ------- --------- -------
Units outstanding at December 31, 1998 ............. 4,894,747 2,916,033 552,225 1,053,424 506,817
========= ========= ======= ========= =======
</TABLE>
A-53
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
GOLDMAN SACHS VARIABLE SALOMON BROTHERS
INSURANCE TRUST FUND VARIABLE SERIES FUND
------------------------- -----------------------------------
GROWTH AND MID CAP
INCOME EQUITY STRATEGIC INVESTORS TOTAL
FUND FUND FUND FUND RETURN
------------ ---------- ----------- ----------- -------
<S> <C> <C> <C> <C> <C>
TYPE I UNITS
Units outstanding at December 31, 1995 ............. -- -- -- -- --
-- -- ---- -- --
Net premiums ...................................... -- -- -- -- --
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. -- -- -- -- --
Surrenders ...................................... -- -- -- -- --
Administrative expenses ......................... -- -- -- -- --
Transfers (to)/from the Guarantee Account ......... -- -- -- -- --
Interfund transfers ............................... -- -- -- -- --
-- -- ---- -- --
Net increase (decrease) in units from capital
transactions ...................................... -- -- -- -- --
-- -- ---- -- --
Units outstanding at December 31, 1996 ............. -- -- -- -- --
-- -- ---- -- --
Net premiums ...................................... -- -- -- -- --
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. -- -- -- -- --
Surrenders ...................................... -- -- -- -- --
Administrative expenses ......................... -- -- -- -- --
Transfers (to)/from the Guarantee Account ......... -- -- -- -- --
Interfund transfers ............................... -- -- -- -- --
-- -- ---- -- --
Net increase (decrease) in units from capital
transactions ...................................... -- -- -- -- --
-- -- ---- -- --
Units outstanding at December 31, 1997 ............. -- -- -- -- --
-- -- ---- -- --
Net premiums ...................................... 10,233 2,260 1,927 42 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits .................................. -- -- -- -- --
Surrenders ...................................... (273) (720) -- -- --
Cost of insurance ............................... (43) (49) (2) -- --
Transfers (to) from the Guarantee Account ......... 22,381 5,400 -- -- --
Interfund transfers ............................... 20,352 71,158 874 -- 6,299
------ ------ ------ -- -----
Net increase (decrease) in units from capital
transactions ...................................... 52,650 78,049 2,799 42 6,299
------ ------ ------ -- -----
Units outstanding at December 31, 1998 ............. 52,650 78,049 2,799 42 6,299
====== ====== ====== == =====
</TABLE>
A-54
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
GE INVESTMENTS FUNDS, INC.
---------------------------------------------------------------------
S&P 500 GOVERNMENT MONEY TOTAL INTERNATIONAL
INDEX SECURITIES MARKET RETURN EQUITY
FUND FUND FUND FUND FUND
------------- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 .............. 400,009 153,756 1,508,360 252,584 47,044
------- ------- --------- ------- ------
Net premiums ....................................... 647,438 194,563 10,719,294 345,169 204,787
Transfers (to) from the general account of Life of
Virginia:
Death benefits ................................... (1,638) (4,586) (41,657) (930) (313)
Surrenders ....................................... (17,183) (4,362) (189,358) (11,361) (4,056)
Administrative expenses .......................... (290) (130) (792) (196) (80)
Transfers (to) from the Guarantee Account .......... 78,749 3,809 (49,295) 38,959 26,698
Interfund transfers ................................ 155,417 (66,854) (8,053,173) 35,026 58,323
------- ------- ---------- ------- -------
Net increase (decrease) in units from capital
transactions ....................................... 862,493 122,440 2,385,019 406,667 285,359
------- ------- ---------- ------- -------
Units outstanding at December 31, 1996 .............. 1,262,502 276,196 3,893,379 659,251 332,403
--------- ------- ---------- ------- -------
Net premiums ....................................... 1,106,640 58,332 7,321,970 188,455 143,803
Transfers (to) from the general account of Life of
Virginia:
Death benefits ................................... (46,669) -- (31,824) (4,811) (188)
Surrenders ....................................... (61,683) (10,472) (497,702) (40,510) (16,180)
Loans ............................................ -- -- -- -- --
Administrative expenses .......................... (1,001) (115) (2,877) (508) (358)
Transfers (to) from the Guarantee Account .......... 376,140 37,807 406,500 93,000 69,865
Interfund transfers ................................ 389,211 (361,748) (6,108,959) 33,268 85,065
--------- -------- ---------- ------- -------
Net increase (decrease) in units from capital
transactions ....................................... 1,762,638 (276,196) 1,087,108 268,894 282,007
--------- -------- ---------- ------- -------
Units outstanding at December 31, 1997 .............. 3,025,140 -- 4,980,487 928,145 614,410
--------- -------- ---------- ------- -------
Net premiums ....................................... 1,191,108 -- 4,686,359 224,832 71,002
Transfers (to) from the general account of Life of
Virginia:
Death benefits ................................... (18,705) -- (269,042) (8,405) (4,372)
Surrenders ....................................... (199,459) -- (1,083,395) (46,133) (38,542)
Cost of insurance ................................ (2,313) -- (4,489) (698) (803)
Transfers (to) from the Guarantee Account .......... 878,507 -- 1,448,793 291,977 130,273
Interfund transfers ................................ 313,281 -- (525,766) 35,416 (130,050)
--------- -------- ---------- ------- --------
Net increase (decrease) in units from capital
transactions ..................................... 2,162,419 -- 4,252,460 496,989 27,508
--------- -------- ---------- ------- --------
Units outstanding at December 31, 1998 ............. 5,187,559 -- 9,232,947 1,425,134 641,918
========= ======== ========== ========= ========
</TABLE>
A-55
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
GE INVESTMENT FUNDS, INC.
---------------------------
REAL ESTATE GLOBAL
SECURITIES INCOME
FUND FUND
------------- -------------
<S> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 ........................ 34,477 --
------ ----
Net premiums ................................................. 214,051 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. -- --
Surrenders ................................................. (1,826) --
Administrative expenses .................................... (43) --
Transfers (to) from the Guarantee Account .................... 19,914 --
Interfund transfers .......................................... 162,396 --
------- ----
Net increase (decrease) in units from capital transactions .... 394,492 --
------- ----
Units outstanding at December 31, 1996 ........................ 428,969 --
------- ----
Net premiums ................................................. 604,427 19,022
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (1,092) --
Surrenders ................................................. (24,343) (487)
Loans ...................................................... -- --
Administrative expenses .................................... (445) (8)
Transfers (to) from the Guarantee Account .................... 236,279 19,733
Interfund transfers .......................................... 234,452 41,030
------- --------
Net increase (decrease) in units from capital transactions .... 1,049,278 79,290
--------- --------
Units outstanding at December 31, 1997 ........................ 1,478,247 79,290
--------- --------
Net premiums ................................................. 242,837 52,447
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (9,506) --
Surrenders ................................................. (44,578) (2,877)
Cost of insurance .......................................... (1,006) (81)
Transfers (to) from the Guarantee Account .................... 346,955 83,494
Interfund transfers .......................................... (259,466) 73,722
--------- --------
Net increase (decrease) in units from capital transactions ... 275,236 206,705
--------- --------
Units outstanding at December 31, 1998 ....................... 1,753,483 285,995
========= ========
<CAPTION>
GE INVESTMENT FUNDS, INC.
----------------------------------------
US
VALUE EQUITY INCOME EQUITY
FUND FUND FUND
-------------- ------------- -----------
<S> <C> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 ........................ -- -- --
-- -- --
Net premiums ................................................. -- 162,212 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. -- -- --
Surrenders ................................................. -- -- --
Administrative expenses .................................... -- -- --
Transfers (to) from the Guarantee Account .................... -- -- --
Interfund transfers .......................................... -- -- --
-- ------- --
Net increase (decrease) in units from capital transactions .... -- -- --
-- ------- --
Units outstanding at December 31, 1996 ........................ -- -- --
-- ------- --
Net premiums ................................................. 242,987 1,357 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (153) -- --
Surrenders ................................................. (5,196) (415) --
Loans ...................................................... -- -- --
Administrative expenses .................................... (28) (42) --
Transfers (to) from the Guarantee Account .................... 146,978 5,210 --
Interfund transfers .......................................... 346,028 897,139 --
------- ------- --
Net increase (decrease) in units from capital transactions .... 730,616 903,249 --
------- ------- --
Units outstanding at December 31, 1997 ........................ 730,616 903,249 --
------- ------- --
Net premiums ................................................. 651,133 162,212 86,729
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (1,696) (5,856) --
Surrenders ................................................. (104,573) (49,209) (787)
Cost of insurance .......................................... (689) (703) (16)
Transfers (to) from the Guarantee Account .................... 607,675 345,204 51,261
Interfund transfers .......................................... 257,534 529,843 43,108
-------- ------- ------
Net increase (decrease) in units from capital transactions ... 1,409,384 981,491 180,295
--------- ------- -------
Units outstanding at December 31, 1998 ....................... 2,140,000 1,884,740 180,295
========= ========= =======
</TABLE>
A-56
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT
FUNDS
----------------------------
MONEY BOND
FUND FUND
--------------- ------------
<S> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 .......... 58,163 275,480
-------- -------
Net premiums ................................... 70 307,614
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... -- (3,625)
Surrenders ................................... (1,020) (13,875)
Administrative expenses ...................... (6) (160)
Transfers (to) from the Guarantee Account ...... (156) 32,015
Interfund transfers ............................ (33,183) 109,648
--------- -------
Net increase (decrease) in units from
capital transactions ........................... (34,295) 431,617
--------- -------
Units outstanding at December 31, 1996 .......... 23,868 707,097
--------- -------
Net premiums ................................... 30 167,289
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... -- (8,306)
Surrenders ................................... (202) (30,599)
Loans ........................................ -- --
Administrative expenses ...................... (5) (513)
Transfers (to) from the Guarantee Account ...... -- 156,266
Interfund transfers ............................ (23,691) 2,783
--------- -------
Net increase (decrease) in units from capital
transactions ................................... (23,868) 286,920
--------- -------
Units outstanding at December 31, 1997 .......... -- 994,017
--------- -------
Net premiums ................................... -- 270,558
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... -- (14,333)
Surrenders ................................... -- (74,631)
Cost of insurance ............................ -- (785)
Transfers (to) from the Guarantee Account ...... -- 382,347
Interfund transfers ............................ -- 419,337
--------- -------
Net increase (decrease) in units from capital
transactions ................................... -- 982,493
--------- -------
Units outstanding at December 31, 1998 .......... -- 1,976,510
========= =========
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
--------------------------------------------------------
CAPITAL HIGH MULTIPLE
APPRECIATION GROWTH INCOME STRATEGIES
FUND FUND FUND FUND
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 .......... 582,579 423,764 561,144 256,681
------- ------- ------- -------
Net premiums ................................... 1,152,800 440,344 922,316 383,300
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (23,778) (2,446) (14,183) (3,190)
Surrenders ................................... (34,224) (9,335) (24,799) (11,252)
Administrative expenses ...................... (668) (213) (520) (329)
Transfers (to) from the Guarantee Account ...... 169,506 50,413 94,808 45,770
Interfund transfers ............................ 275,079 189,075 176,989 77,022
--------- ------- ------- -------
Net increase (decrease) in units from
capital transactions ........................... 1,538,715 667,838 1,154,611 491,321
--------- ------- --------- -------
Units outstanding at December 31, 1996 .......... 2,121,294 1,091,602 1,715,755 748,002
--------- --------- --------- -------
Net premiums ................................... 713,649 880,279 703,696 349,189
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (10,958) (8,211) (16,328) (5,971)
Surrenders ................................... (79,872) (48,836) (109,043) (55,647)
Loans ........................................ -- -- -- --
Administrative expenses ...................... (1,748) (951) (1,245) (701)
Transfers (to) from the Guarantee Account ...... 369,347 337,722 379,179 151,804
Interfund transfers ............................ 64,736 210,754 262,960 13,450
--------- --------- --------- -------
Net increase (decrease) in units from capital
transactions ................................... 1,055,154 1,370,757 1,219,219 452,124
--------- --------- --------- -------
Units outstanding at December 31, 1997 .......... 3,176,448 2,462,359 2,934,974 1,200,126
--------- --------- --------- ---------
Net premiums ................................... 267,347 407,290 416,094 182,920
Transfers (to) from the general account of
Life of Virginia:
Death benefits ............................... (18,426) (19,533) (24,017) (11,769)
Surrenders ................................... (147,815) (120,149) (177,425) (74,629)
Cost of insurance ............................ (2,506) (1,908) (2,036) (993)
Transfers (to) from the Guarantee Account ...... 343,625 410,907 621,713 292,547
Interfund transfers ............................ (505,666) (126,117) (49,276) (29,622)
--------- --------- --------- ---------
Net increase (decrease) in units from capital
transactions ................................... (63,441) 550,490 785,053 358,454
--------- --------- --------- ---------
Units outstanding at December 31, 1998 .......... 3,113,007 3,012,849 3,720,027 1,558,580
========= ========= ========= =========
</TABLE>
A-57
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
VARIABLE INSURANCE PRODUCTS
FUND
---------------------------
MONEY HIGH
MARKET INCOME
PORTFOLIO PORTFOLIO
------------- -------------
<S> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 ........................ 980,344 495,562
------- -------
Net premiums ................................................. 138 --
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (5,285) (1,518)
Surrenders ................................................. (18,734) (18,658)
Administrative expenses .................................... (323) (228)
Transfers (to) from the Guarantee Account .................... (31) (3,382)
Interfund transfers .......................................... (659,500) (168,501)
-------- --------
Net increase (decrease) in units from capital transactions .... (683,735) (192,287)
-------- --------
Units outstanding at December 31, 1996 ........................ 296,609 303,275
-------- --------
Net premiums ................................................. 931 306
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (9,387) (206)
Surrenders ................................................. (6,379) (17,828)
Loans ...................................................... -- --
Administrative expenses .................................... (179) (172)
Transfers (to) from the Guarantee Account .................... -- (595)
Interfund transfers .......................................... (281,595) (284,780)
-------- --------
Net increase (decrease) in units from capital transactions .... (296,609) (303,275)
-------- --------
Units outstanding at December 31, 1997 ........................ -- --
-------- --------
Net premiums ................................................. -- --
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. -- --
Surrenders ................................................. -- --
Cost of insurance .......................................... -- --
Transfers (to) from the Guarantee Account .................... -- --
Interfund transfers .......................................... -- --
-------- --------
Net increase (decrease) in units from capital transactions .... -- --
-------- --------
Units outstanding at December 31, 1998 ........................ -- --
======== ========
<CAPTION>
VARIABLE INSURANCE PRODUCTS FUND
-----------------------------------------
EQUITY-
INCOME GROWTH OVERSEAS
PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ------------- ------------
<S> <C> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 ........................ 3,119,975 1,525,015 829,371
--------- --------- -------
Net premiums ................................................. 3,158,538 1,222,269 521,600
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (43,181) (21,919) (11,961)
Surrenders ................................................. (134,965) (50,499) (31,329)
Administrative expenses .................................... (2,658) (1,349) (733)
Transfers (to) from the Guarantee Account .................... 402,673 186,018 127,385
Interfund transfers .......................................... 541,485 167,039 123,110
--------- --------- -------
Net increase (decrease) in units from capital transactions .... 3,921,892 1,501,559 728,072
--------- --------- -------
Units outstanding at December 31, 1996 ........................ 7,041,867 3,026,574 1,557,443
--------- --------- ---------
Net premiums ................................................. 2,260,371 504,224 230,215
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (70,511) (17,520) (11,283)
Surrenders ................................................. (310,722) (121,652) (59,094)
Loans ...................................................... -- -- --
Administrative expenses .................................... (5,614) (2,437) (1,374)
Transfers (to) from the Guarantee Account .................... 959,930 232,691 169,290
Interfund transfers .......................................... 198,852 (7,282) (122,609)
--------- --------- ---------
Net increase (decrease) in units from capital transactions .... 3,032,306 588,024 205,145
--------- --------- ---------
Units outstanding at December 31, 1997 ........................ 10,074,173 3,614,598 1,762,588
---------- --------- ---------
Net premiums ................................................. 1,114,775 299,241 60,690
Transfers (to) from the general account of Life of
Virginia:
Death benefits ............................................. (77,675) (28,379) (10,651)
Surrenders ................................................. (485,863) (150,297) (67,437)
Cost of insurance .......................................... (7,075) (2,366) (1,208)
Transfers (to) from the Guarantee Account .................... 1,227,043 185,849 81,221
Interfund transfers .......................................... (509,932) (100,385) (208,247)
---------- --------- ---------
Net increase (decrease) in units from capital transactions .... 1,261,273 203,663 (145,632)
---------- --------- ---------
Units outstanding at December 31, 1998 ........................ 11,335,446 3,818,261 1,616,956
========== ========= =========
</TABLE>
A-58
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
VARIABLE INSURANCE VARIABLE INSURANCE
PRODUCTS FUND II PRODUCTS FUND III
--------------------------- -----------------------------
ASSET GROWTH & GROWTH
MANAGER CONTRFUND INCOME OPPORTUNITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- ------------- ---------------
<S> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ...................... 1,469,667 2,007,948 -- --
--------- --------- -- --
Net premiums ........................... 640,444 2,595,994 -- --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (19,704) (23,500) -- --
Surrenders ........................... (67,829) (72,281) -- --
Administrative expenses .............. (1,135) (2,159) -- --
Transfers (to) from the Guarantee
Account .............................. 117,636 428,333 -- --
Interfund transfers .................... 109,440 559,664 -- --
--------- --------- -- --
Net increase (decrease) in units from
capital transactions ................... 778,852 3,486,051 -- --
--------- --------- -- --
Units outstanding at
December 31, 1996 ...................... 2,248,519 5,493,999 -- --
--------- --------- -- --
Net premiums ........................... 317,380 2,003,590 452,458 553,737
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (14,483) (32,105) (176) (968)
Surrenders ........................... (101,528) (196,054) (9,166) (9,539)
Loans ................................ -- -- -- --
Administrative expenses .............. (1,272) (4,990) (79) (66)
Transfers (to) from the Guarantee
Account .............................. 132,093 1,027,864 208,287 207,607
Interfund transfers .................... 98,224 303,373 324,762 298,769
--------- --------- ------- -------
Net increase (decrease) in units from
capital transactions ................... 430,414 3,101,678 976,086 1,049,540
--------- --------- ------- ---------
Units outstanding at
December 31, 1997 ...................... 2,678,933 8,595,677 976,086 1,049,540
--------- --------- ------- ---------
Net premiums ........................... 252,836 1,051,752 918,372 716,944
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (17,250) (51,811) (49,171) (7,825)
Surrenders ........................... (134,438) (317,883) (60,159) (69,582)
Cost of insurance .................... (1,548) (6,665) (1,024) (1,197)
Transfers (to) from the Guarantee
Account .............................. 283,280 1,100,294 688,392 768,665
Interfund transfers .................... 114,498 (285,564) 371,319 502,246
--------- --------- ------- ---------
Net increase (decrease) in units from
capital transactions ................... 497,378 1,490,123 1,867,729 1,909,251
--------- --------- --------- ---------
Units outstanding at December 31,
1998 ................................... 3,176,311 10,085,800 2,843,815 2,958,791
========= ========== ========= =========
<CAPTION>
ADVISERS MANAGEMENT TRUST
----------------------------------------
BALANCED BOND GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- ------------
<S> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ...................... 191,438 398,276 209,909
------- ------- -------
Net premiums ........................... -- (252) --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (1,089) (8,981) (1,419)
Surrenders ........................... (2,814) (3,959) (6,733)
Administrative expenses .............. (103) (315) (174)
Transfers (to) from the Guarantee
Account .............................. -- 120 --
Interfund transfers .................... (44,480) (127,260) (46,447)
------- -------- -------
Net increase (decrease) in units from
capital transactions ................... (48,486) (140,647) (54,773)
------- -------- -------
Units outstanding at
December 31, 1996 ...................... 142,952 257,629 155,136
------- -------- -------
Net premiums ........................... 25 -- --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (2,194) (1,620) --
Surrenders ........................... (10,921) (12,250) (3,242)
Loans ................................ -- -- --
Administrative expenses .............. (108) (204) (81)
Transfers (to) from the Guarantee
Account .............................. (601) (6,721) --
Interfund transfers .................... (129,153) (236,834) (151,813)
-------- -------- --------
Net increase (decrease) in units from
capital transactions ................... (142,952) (257,629) (155,136)
-------- -------- --------
Units outstanding at
December 31, 1997 ...................... -- -- --
-------- -------- --------
Net premiums ........................... -- -- --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... -- -- --
Surrenders ........................... -- -- --
Cost of insurance .................... -- -- --
Transfers (to) from the Guarantee
Account .............................. -- -- --
Interfund transfers .................... -- -- --
-------- -------- --------
Net increase (decrease) in units from
capital transactions ................... -- -- --
-------- -------- --------
Units outstanding at December 31,
1998 ................................... -- -- --
======== ======== ========
</TABLE>
A-59
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
FEDERATED INVESTORS INSURANCE
SERIES
--------------------------------------------
AMERICAN HIGH
LEADERS INCOME
PORTFOLIO BONDS UTILITY
FUND II FUND II FUND II
---------------- ------------- -------------
<S> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ...................... -- 123,152 463,476
---- ------- -------
Net premiums ........................... 208,871 343,618 543,077
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... -- (1,859) (3,067)
Surrenders ........................... (2,478) (25,640) (28,920)
Administrative expenses .............. (2) (143) (566)
Transfers (to) from the Guarantee
Account .............................. 12,459 29,882 81,126
Interfund transfers .................... 46,982 340,979 75,307
--------- ------- -------
Net increase (decrease) in units from
capital transactions ................... 265,832 686,837 666,957
--------- ------- -------
Units outstanding at
December 31, 1996 ...................... 265,832 809,989 1,130,433
--------- ------- ---------
Net premiums ........................... 998,765 599,938 229,931
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (7,020) (7,987) (3,557)
Surrenders ........................... (30,390) (46,149) (62,619)
Loans ................................ -- -- --
Administrative expenses .............. (399) (579) (981)
Transfers (to) from the Guarantee
Account .............................. 355,249 292,000 95,492
Interfund transfers .................... 474,654 239,675 (62,998)
--------- ------- ---------
Net increase (decrease) in units from
capital transactions ................... 1,790,859 1,076,898 195,268
---------- --------- ---------
Units outstanding at
December 31, 1997 ...................... 2,056,691 1,886,887 1,325,701
---------- --------- ---------
Net premiums ........................... 1,050,794 473,760 292,385
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (44,621) (24,952) (12,603)
Surrenders ........................... (111,859) (152,690) (73,103)
Cost of insurance .................... (2,136) (1,284) (1,163)
Transfers (to) from the Guarantee
Account .............................. 942,089 803,434 316,103
Interfund transfers .................... 64,125 (7,464) 103,595
---------- --------- ---------
Net increase (decrease) in units from
capital transactions ................... 1,898,392 1,090,804 625,214
---------- --------- ---------
Units outstanding at December 31,
1998 ................................... 3,955,083 2,977,691 1,950,915
========== ========= =========
<CAPTION>
PBHG INSURANCE
ALGER AMERICAN SERIES FUND
--------------------------- ------------------------
LARGE CAP
SMALL CAP GROWTH GROWTH GROWTH II
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ...................... 401,258 312,011 -- --
------- ------- -- --
Net premiums ........................... 2,385,857 1,979,744 -- --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (6,505) (2,249) -- --
Surrenders ........................... (49,583) (21,913) -- --
Administrative expenses .............. (658) (517) -- --
Transfers (to) from the Guarantee
Account .............................. 364,980 234,626 -- --
Interfund transfers .................... 472,803 460,475 -- --
--------- --------- -- --
Net increase (decrease) in units from
capital transactions ................... 3,166,894 2,650,166 -- --
--------- --------- -- --
Units outstanding at
December 31, 1996 ...................... 3,568,152 2,962,177 -- --
--------- --------- -- --
Net premiums ........................... 1,139,813 1,030,593 108,061 306,146
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (25,827) (23,277) (63) --
Surrenders ........................... (95,915) (104,485) (998) (4,853)
Loans ................................ -- -- -- --
Administrative expenses .............. (3,710) (2,759) (28) (35)
Transfers (to) from the Guarantee
Account .............................. 865,037 527,894 51,297 100,624
Interfund transfers .................... 197,908 (9,957) 188,564 174,128
--------- --------- ------- -------
Net increase (decrease) in units from
capital transactions ................... 2,077,306 1,418,009 346,833 576,010
--------- --------- ------- -------
Units outstanding at
December 31, 1997 ...................... 5,645,458 4,380,186 346,833 576,010
--------- --------- ------- -------
Net premiums ........................... 543,439 690,044 168,982 126,932
Transfers (to) from the general
account of Life of Virginia:
Death benefits ....................... (35,528) (33,911) (3,311) (11,165)
Surrenders ........................... (238,113) (227,269) (33,291) (36,248)
Cost of insurance .................... (4,762) (3,266) (404) (590)
Transfers (to) from the Guarantee
Account .............................. 719,382 587,070 148,909 227,092
Interfund transfers .................... (547,462) 212,429 68,319 (42,435)
--------- --------- ------- -------
Net increase (decrease) in units from
capital transactions ................... 436,956 1,225,097 349,204 263,586
--------- --------- ------- -------
Units outstanding at December 31,
1998 ................................... 6,082,414 5,605,283 696,037 839,596
========= ========= ======= =======
</TABLE>
A-60
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
JANUS ASPEN SERIES
--------------------------------------------
AGGRESSIVE
GRWOTH GROWTH WORLDWIDE
PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ------------- --------------
<S> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ................ 1,251,004 1,875,640 1,227,070
--------- --------- ---------
Net premiums ..................... 1,109,539 1,939,884 2,853,570
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (5,075) (28,847) (26,212)
Surrenders ..................... (20,314) (111,109) (94,535)
Administrative expenses ........ (141) (2,321) (2,275)
Transfers (to) from the
Guarantee Account .............. 99,771 288,072 475,568
Interfund transfers .............. 227,267 921,603 713,001
--------- --------- ---------
Net increase (decrease) in units
from capital transactions ........ 1,411,047 3,007,282 3,919,117
--------- --------- ---------
Units outstanding at
December 31, 1996 ................ 2,662,051 4,882,922 5,146,187
--------- --------- ---------
Net premiums ..................... 608,750 1,633,216 3,372,062
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (22,328) (36,365) (35,456)
Surrenders ..................... (80,725) (180,611) (228,974)
Loans .......................... -- -- --
Administrative expenses ........ (1,935) (4,325) (4,300)
Transfers (to) from the
Guarantee Account .............. 253,985 867,094 1,289,775
Interfund transfers .............. 22,869 108,967 572,391
--------- --------- ---------
Net increase (decrease) in units
from capital transactions ........ 780,616 2,387,976 4,965,498
--------- --------- ---------
Units outstanding at
December 31, 1997 ................ 3,442,667 7,270,898 10,111,685
--------- --------- ----------
Net premiums ..................... 8,584,230 859,963 1,450,914
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (1,210,219) (49,261) (36,063)
Surrenders ..................... (5,336,460) (293,814) (402,150)
Cost of insurance .............. (83,426) (5,694) (7,564)
Transfers (to) from the
Guarantee Account .............. 8,351,873 854,937 1,487,450
Interfund transfers .............. (10,259,970) 190,192 (49,539)
----------- --------- ----------
Net increase (decrease) in units
from capital transactions ........ 46,028 1,556,323 2,443,048
----------- --------- ----------
Units outstanding at
December 31, 1998 ................ 3,488,695 8,827,221 12,554,733
=========== ========= ==========
<CAPTION>
JANUS ASPEN SERIES
-----------------------------------------------------------
FLEXIBLE INTERNATIONAL CAPITAL
BALANCED INCOME GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at
December 31, 1995 ................ 73,538 36,272 -- --
------ ------ -- ----
Net premiums ..................... 547,525 240,317 388,753 --
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (1,525) -- -- --
Surrenders ..................... (10,808) (1,714) (2,959) --
Administrative expenses ........ (267) (63) (11) --
Transfers (to) from the
Guarantee Account .............. 75,940 21,420 47,466 --
Interfund transfers .............. 308,093 28,937 249,356 --
------- ------- ------- ----
Net increase (decrease) in units
from capital transactions ........ 918,958 288,897 682,605 --
------- ------- ------- ----
Units outstanding at
December 31, 1996 ................ 992,496 325,169 682,605 --
------- ------- ------- ----
Net premiums ..................... 1,117,148 284,347 1,872,823 55,458
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (7,246) (4,723) (15,267) --
Surrenders ..................... (78,945) (17,933) (60,571) (1,630)
Loans .......................... -- -- -- --
Administrative expenses ........ (1,005) (342) (863) (7)
Transfers (to) from the
Guarantee Account .............. 423,506 175,029 576,462 35,560
Interfund transfers .............. 358,481 107,542 446,411 74,169
--------- ------- --------- --------
Net increase (decrease) in units
from capital transactions ........ 1,811,939 543,920 2,818,995 163,550
--------- ------- --------- ---------
Units outstanding at
December 31, 1997 ................ 2,804,435 869,089 3,501,600 163,550
--------- ------- --------- ---------
Net premiums ..................... 1,375,800 279,606 441,888 430,714
Transfers (to) from the general
account of Life of Virginia:
Death benefits ................. (37,836) (1,075) (22,070) (3,280)
Surrenders ..................... (191,342) (44,562) (83,852) (38,646)
Cost of insurance .............. (2,568) (846) (2,512) (341)
Transfers (to) from the
Guarantee Account .............. 1,386,720 485,989 655,579 289,248
Interfund transfers .............. 724,982 322,950 (134,423) 653,113
--------- ------- --------- ---------
Net increase (decrease) in units
from capital transactions ........ 3,255,756 1,042,062 854,610 1,330,808
--------- --------- --------- ----------
Units outstanding at
December 31, 1998 ................ 6,060,191 1,911,151 4,356,210 1,494,358
========= ========= ========= ==========
</TABLE>
A-61
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
<TABLE>
<CAPTION>
GOLDMAN SACHS VARIABLE SALOMON BROTHERS
INSURANCE TRUST FUND VARIABLE SERIES FUND
-------------------------- ------------------------------------
GROWTH AND MID CAP
INCOME EQUITY STRATEGIC INVESTORS TOTAL
FUND FUND FUND FUND RETURN
------------ ------------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
TYPE II UNITS
Units outstanding at December 31, 1995 ...................... -- -- -- -- --
-- ---- -- -- ----
Net premiums ............................................... -- -- -- -- --
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... -- -- -- -- --
Surrenders ............................................... -- -- -- -- --
Administrative expenses .................................. -- -- -- -- --
Transfers (to) from the Guarantee Account .................. -- -- -- -- --
Interfund transfers ........................................ -- -- -- -- --
-- ---- -- -- ----
Net increase (decrease) in units from capital transactions .. -- -- -- -- --
-- ---- -- -- ----
Units outstanding at December 31, 1996 ...................... -- -- -- -- --
-- ---- -- -- ----
Net premiums ............................................... -- -- -- -- --
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... -- -- -- -- --
Surrenders ............................................... -- -- -- -- --
Loans .................................................... -- -- -- -- --
Administrative expenses .................................. -- -- -- -- --
Transfers (to) from the Guarantee Account .................. -- -- -- -- --
Interfund transfers ........................................ -- -- -- -- --
-- ---- -- -- ----
Net increase (decrease) in units from capital transactions .. -- -- -- -- --
-- ---- -- -- ----
Units outstanding at December 31, 1997 ...................... -- -- -- -- --
-- ---- -- -- ----
Net premiums ............................................... 205,860 187,855 -- 811 15,933
Transfers (to) from the general account of Life of Virginia:
Death benefits ........................................... -- -- -- -- --
Surrenders ............................................... (4,646) (4,160) -- -- (2)
Cost of insurance ........................................ (13) (9) 1,466
Transfers (to) from the Guarantee Account .................. 104,669 147,037 8,628 52 1,350
Interfund transfers ........................................ 123,066 14,810 -- -- 8,634
------- -------- ----- --- -------
Net increase (decrease) in units from capital transactions .. 428,936 345,533 10,094 863 25,915
------- -------- ------ --- -------
Units outstanding at December 31, 1998 ...................... 428,936 345,533 10,094 863 25,915
======= ======== ====== === =======
</TABLE>
A-62
<PAGE>
LIFE OF VIRGINIA SEPARATE ACCOUNT 4
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 -- CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -- Continued
(D) FEDERAL INCOME TAXES
The Account is not taxed separately because the operations of the Account
are part of the total operations of Life of Virginia. Life of Virginia is taxed
as a life insurance company under the Internal Revenue Code (the Code). Life of
Virginia is included in the General Electric Capital Assurance Company
consolidated federal income tax return. Under existing federal income tax law,
no taxes are payable on the investment income or on the capital gains of the
Account.
(E) USE OF ESTIMATES
Financial statements prepared in conformity with generally accepted
accounting principles require management to make estimates and assumptions that
affect amounts and disclosures reported therein. Actual results could differ
from those estimates.
(3) RELATED PARTY TRANSACTIONS
Net premiums transferred from Life of Virginia to the Account represent
gross premiums recorded by Life of Virginia on its flexible premium variable
deferred annuity products, less deductions retained as compensation for premium
taxes. For policies issued on or after May 1, 1993, the deduction for premium
taxes will be deferred until surrender. For Type I policies, during the first
ten years following a premium payment, a charge of .20% of the premium payment
is deducted monthly from the policy Account values to reimburse Life of
Virginia for certain distribution expenses. In addition, a charge is imposed on
full and certain partial surrenders that occur within six years of any premium
payment (seven years for certain Type II policies) to cover certain expenses
relating to the sale of a policy. Subject to certain limitations, the charge
equals 6% (or less) of the premium surrendered, depending on the time between
premium payment and surrender.
Life of Virginia will deduct a charge of $30 per year and $25 plus .15%
per year from the policy account values for certain administrative expenses
incurred for policy Type I and Type II, respectively. For Type II policies, the
$25 charge may be waived if the account value is greater than $75,000. In
addition, Life of Virginia charges the Account 1.15% and 1.25% on policy Type I
and Type II, respectively, for the mortality and expense risk that Life of
Virginia assumes. Administrative expenses as well as mortality and risk charges
are deducted daily and reflect the effective annual rates.
GE Investments Funds, Inc. (the Fund) is an open-end diversified
management investment company.
Capital Brokerage Corporation, an affiliate of Life of Virginia, is a
Washington Corporation registered with the Commission under the Securities
Exchange Act of 1934 as a broker-dealer and is a member of the National
Association of Securities Dealers, Inc. Capital Brokerage Corporation serves as
principal underwriter for variable life insurance policies issued by Life of
Virginia.
GE Investment Management Incorporated (Investment Advisor), a wholly-owned
subsidiary of GE, currently serves as investment advisor to GE Investments
Funds, Inc. As compensation for its services, the Investment Advisor is paid an
investment advisory fee by the Fund based on the average daily net assets at an
effective annual rate of .35% for the S&P 500 Index Fund, .50% for the Money
Market, Income Fund, and Total Return Funds, 1.00% for the International Equity
Fund, .85% for the Real Estate Securities Fund, .60% for the Global Income
Fund, .65% for the Value Equity Fund and .55% for the U.S. Equity Fund. Prior
to May 1, 1997, Aon Advisors, Inc. served as investment advisor to the Fund and
was subject to the same compensation arrangement as GE Investment Management
Incorporated.
Certain officers and directors of Life of Virginia are also officers and
directors of Capital Brokerage Corporation.
(4) SUBSEQUENT EVENT
Effective January 1, 1999 The Life Insurance Company of Virginia merged
with The Harvest Life Insurance Company to form GE Life and Annuity Assurance
Company. Concurrently, the Account changed its name to GE Life & Annuity
Separate Account 4. Neither of these events have an impact on net assets or
unit values.
A-63
