<TABLE>
USLICO Series Fund
Statement of Assets and Liabilities
June 30, 1996
(Unaudited)
Common Money Asset Total
Stock Market Bond Allocation Portfolios
Portfolio Portfolio Portfolio Portfolio Combined
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 536,564 $ 8,417 $ 71,823 $ 475,279 $ 1,092,083
Common stock, at fair value (cost
$18,077,598 and $5,857,038, respectively) 20,928,704 - - 6,733,885 27,662,589
Bonds, at fair value (cost
$2,561,605 and $6,277,601, respectively) - - 2,541,954 6,194,315 8,736,269
Commercial paper, at amortized
cost which approximates fair value - 5,897,729 - - 5,897,729
Dividends receivable 72,264 - - 24,864 97,128
Interest receivable 1,996 45 48,961 117,479 168,481
Securities not settled, net - - - 40,584 40,584
------------ ------------ ------------ ------------ ------------
Total assets 21,539,528 5,906,191 2,662,738 13,586,406 43,694,863
------------ ------------ ------------ ------------ ------------
LIABILITIES
Accrued expenses 165,795 68,273 34,706 91,356 360,130
Securities not settled, net 42,096 - - - 42,096
------------ ------------ ------------ ------------ ------------
Total liabilities 207,891 68,273 34,706 91,356 402,226
------------ ------------ ------------ ------------ ------------
NET ASSETS $ 21,331,637 $ 5,837,918 $ 2,628,032 $ 13,495,050 $ 43,292,637
============ ============ ============ ============ ============
Net asset value per share $ 13.71 $ 1.00 $ 9.77 $ 11.97
============ ============ ============ ============
Shares outstanding 1,556,281 5,837,918 268,935 1,126,937
============ ============ ============ ============
Net assets consist of:
Capital stock ($.001 par value) $ 1,556 $ 5,838 $ 269 $ 1,127
Additional paid-in capital 16,653,125 5,832,080 2,646,425 11,983,255
Accumulated undistributed
net investment income 12,663 13 1,964 8,680
Accumulated undistributed net
realized gains (losses) from
investment transactions 1,813,187 (13) (975) 708,427
Net unrealized appreciation
(depreciation) of investments 2,851,106 - (19,651) 793,561
------------ ------------ ------------ ------------
Net assets $ 21,331,637 $ 5,837,918 $ 2,628,032 $ 13,495,050
============ ============ ============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Common Stock Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Common Stock
Fair Fair
Shares Value Shares Value
--------- ----------- --------- -----------
<S> <C> <C> <S> <C> <C>
Aerospace & Defense - 4.33% Food, House & Personal Products - (continued)
- --------------------------- ------------------------------------------------
Boeing Co. 5,400 $ 484,650 RJR Nabisco Holdings 19,920 $ 637,440
United Technologies Corp. 3,800 437,950 RJR Nabisco PFD 14,500 94,250
----------- UST Inc. 10,300 354,063
922,600 -----------
----------- 1,510,441
Chemicals - 4.50% -----------
- ----------------- Industrial - 15.94%
W. R. Grace & Co. 7,600 554,800 -------------------
Great Lakes Chemical 4,000 248,500 Aluminum Co. of America 9,100 525,525
Mallinckrodt Group, Inc. 4,100 157,337 Browning-Ferris Industries, Inc. 8,300 238,625
----------- Cooper Industries Inc. 8,200 345,425
960,637 Genuine Parts Co. 5,800 268,975
----------- International Paper Co. 5,250 196,219
Computers - 0.79% James River Corp. of Virginia 12,800 336,000
- ----------------- Masco Corp. 19,500 587,437 0.0420
International Business Machine 1,700 168,087 Mead Corp. 6,000 307,500
----------- Pitney Bowes, Inc. 2,100 98,963
168,087 WMX Technologies, Inc. 15,100 496,412
----------- -----------
Diversified - 1.57% 3,401,081
- -------------------- -----------
Corning, Inc. 8,700 334,950 Office Business Equipment - 1.81%
----------- ---------------------------------
334,950 Xerox Corp. 7,500 386,250
----------- -----------
Drugs & Health Care - 4.20% 386,250
- --------------------------- -----------
Baxter International, Inc. 4,600 219,650 Publishing - 2.05%
Bristol-Myers Squibb Co. 7,600 676,400 ------------------
----------- Dun & Bradstreet 7,000 436,625
896,050 -----------
----------- 436,625
Energy - 15.33% -----------
- --------------- Retail Trade - 3.56%
Amoco Corp. 5,500 389,125 --------------------
Atlantic Richfield Co. 3,600 429,300 American Stores Co. 8,300 314,363
Exxon Corp. 4,400 385,000 Limited 10,171 212,320
Chevron Corp. 3,700 219,687 Reebok International Ltd. 7,300 233,600 0.1206
Mobil Corp. 3,850 440,344 -----------
Panenergy Corp. 10,600 347,150 760,283
Schlumberger Ltd. 3,450 288,075 -----------
TransCanada Pipelines Ltd. 22,800 336,300 Telecommunications - 12.43%
USX-Marathon Group 21,800 436,000 ---------------------------
----------- AT & T Corp. 15,300 948,600 0.9811
3,270,981 GTE Corp. 11,900 531,037
----------- NYNEX Corp. 18,500 862,563
Finance - 12.06% Sprint Corp. 7,500 308,438 0.0189 1
- ---------------- -----------
Aetna Life & Casualty Co. 9,100 652,925 2,650,638
Chubb Corp. 2,100 103,162 -----------
Fleet Financial Group, Inc. 10,000 433,750 Utilities - 12.46%
General Re Corp. 2,250 342,281 ------------------
ITT Hartford Group, Inc. 4,200 222,600 Baltimore Gas & Electric 6,500 181,188
NationsBank Corp. 2,950 240,425 Edison International 12,900 220,912
Providian Corp. 2,500 105,000 Entergy Corp. 17,700 493,388
St. Paul Companies 8,900 472,812 FPL Group 9,800 443,450
----------- General Public Utilities Corp. 10,600 352,450
2,572,955 PacifiCorp 13,500 297,000
----------- Peco Energy Co. 18,250 456,250
Food, House & Personal Products - 7.08% Southern Co. 8,900 212,488
- -------------------------------------- -----------
Anheuser-Busch Co., Inc. 2,300 171,925 2,657,126
Archer-Daniels-Midland Co. 12,070 230,839 -----------
Earthgrains 672 21,924
Total Common Stock 98.11% 20,928,704
Other Assets and
Liabilities, Net 1.89% 402,933
-----------
Net Assets 100.00% $ 21,331,637
===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Money Market Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Principal Amortized
Commercial Paper 101.02% Amount Cost
------------ ------------
<S> <C> <C>
Ameritech Capital, 5.31%, Due July 2, 1996 $ 200,000 $ 199,882
First Chicago Finance, 5.33%, Due July 3, 1996 300,000 299,778
Household Finance, 5.31%, Due July 8, 1996 255,000 254,624
Nordstrom Credit, 5.34%, Due July 9, 1996 250,000 249,592
Kansas City Power & Light, 5.36%, Due July 12, 1996 210,000 209,562
Florida Power, 5.38%, Due July 12, 1996 220,000 219,540
Alabama Power Co., 5.27%, Due July 16, 1996 290,000 289,236
PHH Corp., 5.27%, Due July 19, 1996 250,000 249,232
AT & T Capital, 5.27%, Due July 25, 1996 260,000 258,972
Raytheon, Inc., 5.30%, Due July 25, 1996 250,000 249,006
Proctor & Gamble, 5.34%, Due July 26, 1996 270,000 268,879
American General Corp., 5.34%, Due July 29, 1996 290,000 288,666
Idaho Power, 5.38%, Due July 29, 1996 275,000 273,726
Temple Inland Inc., 5.40%, Due July 31, 1996 250,000 248,762
Norwest Corp., 5.34%, Due August 2, 1996 210,000 208,910
Merrill Lynch, 5.36%, Due August 8, 1996 270,000 268,352
Smith Barney Shearson, 5.35%, Due August 12, 1996 275,000 273,161
Pitney Bowes Credit, 5.30%, Due August 19, 1996 275,000 272,895
BellSouth Telecommunications, 5.35%, Due August 21, 1996 270,000 267,833
Coca-Cola Company, 5.34%, Due September 9, 1996 275,000 272,022
Dupont, 5.36%, Due September 18, 1996 275,000 271,643
Beneficial Corp., 5.38%, Due September 19, 1996 260,000 256,775
General Electric Capital , 5.37%, Due September 25, 1996 250,000 246,681
------------ ------------
Total Commercial Paper 101.02% $ 5,930,000 5,897,729
============
Other Assets and
Liabilities, Net (1.02)% (59,811)
------------
Net Assets 100.00% $ 5,837,918
============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Bond Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Par Fair
Bonds Value Value
------------ ------------
<S> <C> <C>
Government - 36.91%
-------------------
GNMA Pool 181826, 9.00%, Due March, 2021 # $ 34,057 $ 35,558
US Treasury Note, 8.00%, Due May, 2001 350,000 370,180
US Treasury Note, 7.50%, Due February, 2005 400,000 417,438
US Treasury Note, 6.875%, Due August, 2025 150,000 146,742
------------ ------------
934,057 969,918
------------ ------------
Finance - 22.72%
----------------
BHP Finance USA, 6.42%, Due March, 2026 100,000 95,461
Chase Manhattan, 8.625%, Due May, 2002 100,000 106,964
J.P. Morgan Co., 7.625%, Due September, 2004 100,000 102,093
MBNA Corp., 7.25%, Due September, 2002 100,000 99,960
TriNet Corporate Realty Trust, 7.30%, Due May, 2001 100,000 100,149
U.S. Leasing International, 5.95%, Due October, 2003 100,000 92,441
------------ ------------
600,000 597,068
------------ ------------
Industrial - 13.22%
-------------------
Hoechst Celanese, 6.125%, Due February, 2004 100,000 93,559
Motorola, Inc., 7.60%, Due January, 2007 100,000 102,726
Norfolk Southern Corp., 7.875%, Due February, 2004 50,000 52,170
Xerox Corp., 7.15%, Due August, 2004 100,000 99,080
------------ ------------
350,000 347,535
------------ ------------
Retail Trade - 8.22%
--------------------
May Department Stores, 9.875%, Due June, 2000 100,000 109,492
Wal-Mart Stores, 8.625%, Due April, 2001 100,000 106,635
------------ ------------
200,000 216,127
------------ ------------
Utilities - 15.65%
------------------ *******
Edison International, 7.375%, Due December, 2003 100,000 99,079
General Telephone ILL, 7.50%, Due February, 2002 100,000 100,875
United Telecommunications, 9.50%, Due April, 2003 100,000 111,646
Washington Gas & Light, 7.53%, Due July, 2002 100,000 99,706
------------ ------------
400,000 411,306
------------ ------------
0
Total Bonds 96.72% $ 2,484,057 2,541,954
============
Other Assets and
Liabilities, Net 3.28% 86,078
------------
Net Assets 100.00% $ 2,628,032
============
# - Callable at the option of the issuer.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Asset Allocation Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Common Stock
Fair Fair
Shares Value Shares Value
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Aerospace & Defense - 2.15% Food, House & Personal Products - (continued)
- --------------------------- ---------------------------------------------
Boeing Co. 1,700 $ 152,575 RJR Nabisco Holdings 6,360 $ 203,520
United Technologies Corp. 1,200 138,300 RJR Nabisco PFD 4,600 29,900
----------- UST Inc. 3,300 113,437
290,875 -----------
----------- 427,068
Chemicals - 2.52% -----------
- ----------------- Industrial - 8.16%
Great Lakes Chemical 1,350 83,869 --------------------
W. R. Grace & Co. 2,450 178,850 Aluminum Co. of America 2,900 167,475
Mallinckrodt Group, Inc. 2,000 76,750 Browning-Ferris Industries, Inc 2,600 74,750
----------- Cooper Industries Inc.. 2,650 111,631
339,469 Genuine Parts Co.. 1,800 83,475
----------- International Paper Co. 1,850 69,144
Computers - 0.55% James River Corp. of Virginia 4,300 112,875
- -------------------- Masco Corp. 6,200 186,775
International Business Machine 750 74,156 Mead Corp. 2,000 102,500
----------- Pitney Bowes, Inc. 700 32,988
74,156 WMX Technologies, Inc. 4,850 159,444
----------- -----------
Diversified - 0.78% 1,101,057
- ---------------------- -----------
Corning, Inc. 2,750 105,875 Office Business Equipment - 0.92%
----------- ---------------------------------
105,875 Xerox Corp. 2,400 123,600
----------- -----------
Drugs & Health Care - 2.10% 123,600
- --------------------------- -----------
Baxter International, Inc. 1,450 69,237 Publishing - 1.11%
Bristol-Myers Squibb Co. 2,400 213,600 ------------------
----------- Dun & Bradstreet 2,400 149,700
282,837 -----------
----------- 149,700
Energy - 7.67% -----------
- -------------- Retail Trade - 1.81%
Amoco Corp. 1,900 134,425 --------------------
Atlantic Richfield Co. 1,150 137,138 American Stores Co. 2,650 100,369
Chevron Corp. 1,150 68,281 Limited 3,281 68,491
Exxon Corp. 1,400 122,500 Reebok International Ltd. 2,350 75,200
Mobil Corp. 1,250 142,969 -----------
Panenergy Corp. 3,400 111,350 244,060
Schlumberger Ltd. 850 70,975 -----------
TransCanada Pipelines Ltd. 7,300 107,675 Telecommunications - 6.39%
USX-Marathon Group 7,000 140,000 --------------------------
----------- AT & T Corp. 4,900 303,800
1,035,313 GTE Corp. 4,100 182,963
----------- NYNEX Corp. 5,950 277,419
Finance - 6.34% Sprint Corp. 2,400 98,700
- --------------- -----------
Aetna Life & Casualty Co. 2,900 208,075 862,882
Chubb Corp. 700 34,387 -----------
Fleet Financial Group, Inc. 3,400 147,475 Utilities - 6.24%
General Re Corp. 750 114,094 -----------------
ITT Hartford Group 1,400 74,200 Baltimore Gas & Electric 2,050 57,144
NationsBank Corp. 1,000 81,500 Edison International 4,100 70,212
Providian Corp. 800 33,600 Entergy Corp. 5,650 157,494
St. Paul Companies 3,050 162,031 FPL Group 3,300 149,325
----------- General Public Utilities Corp. 3,350 111,387
855,362 PacifiCorp 3,500 77,000
----------- Peco Energy Co. 5,850 146,250
Food, House & Personal Products - 3.16% Southern Co. 3,050 72,819
- --------------------------------------- -----------
Archer-Daniels-Midland Co. 3,800 72,675 841,631
Earthgrains 231 7,536 -----------
Total Common Stock 49.90% 6,733,885
---------
(continued)
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Asset Allocation Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Bonds Par Fair
Value Value
------------ ------------
<S> <C> <C>
Government - 16.60%
-------------------
FHLMC, 9.00%, Due October, 2019 # $ 33,299 $ 34,599
GNMA, 10.00%, Due February, 2016 # 9,161 9,980
US Treasury Note, 8.00%, Due May, 2001 1,000,000 1,057,656
US Treasury Note, 7.50%, Due February, 2005 950,000 991,414
US Treasury Note, 6.875%, Due August, 2025 150,000 146,742
------------ ------------
2,142,460 2,240,391
------------ ------------
Finance - 11.50%
----------------
BHP Finance Corp., 6.42%, Due March, 2026 100,000 95,460
Chase Manhatttan, 8.625%, Due May, 2002 100,000 106,964
Citicorp, 7.125%, Due June, 2003 100,000 99,382
Discover Card Trust 1991-D, 8.00%, Due October, 1998 100,000 102,500
Ford Motor Credit, 8.00%, Due June, 2002 150,000 156,132
General Electric Capital, 7.875%, Due December, 2006 100,000 104,637
J.P. Morgan Co., 7.625%, Due September, 2004 100,000 102,093
MBNA Corp., 7.25%, Due September, 2002 100,000 99,960
Morgan Stanley, 6.375%, Due December, 2003 150,000 141,873
Norwest Financial, 6.125%, Due August, 2003 150,000 140,841
Standard Credit Corp., 9.375%, Due July, 1997 100,000 103,188
Texaco Capital, Inc., 8.03%, Due October, 2002 100,000 104,151
TriNet Corporate Realty Trust, 7.30%, Due May, 2001 100,000 100,149
U.S. Leasing International, 6.70%, Due April, 2003 100,000 95,251
------------ ------------
1,550,000 1,552,581
------------ ------------
Industrial - 7.43%
------------------
Canadian Pacific, 6.875%, Due April, 2003 100,000 96,503
Communications Satellite Corp., 8.125%, Due April, 2004 100,000 104,770
Equitable Resources, 8.19%, Due November, 2001 100,000 103,714
Hoechst Celanese, 6.125%, Due February, 2004 100,000 93,559
Lowe's Cos., 7.25%, Due August, 2002 100,000 97,922
Motorola, Inc., 7.60%, Due January, 2007 100,000 102,726
Norfolk Southern Corp., 7.875%, Due February, 2004 100,000 104,340
PepsiCo Inc., 7.75%, Due October, 1998 100,000 102,359
Warner Lambert, 6.625%, Due September, 2002 100,000 98,216
Xerox Corp., 7.15%, Due August, 2004 100,000 99,080
------------ ------------
1,000,000 1,003,189
------------ ------------
(continued)
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund-Asset Allocation Portfolio
Statement of Investments
June 30, 1996
(Unaudited)
Bonds, continued Par Fair
Value Value
------------ ------------
<S> <C> <C>
Retail Trade - 3.01%
--------------------
J.C. Penney, 6.125%, Due November, 2003 $ 100,000 $ 93,929
May Department Stores, 9.875%, Due June, 2000 100,000 109,492
Sears, 6.54%, Due July, 2003 100,000 95,521
Wal-Mart Stores, 8.625%, Due April, 2001 100,000 106,635
------------ ------------
400,000 405,577
------------ ------------
Utilities - 7.36%
-----------------
Allegheny Generating, 5.625%, Due September, 2003 100,000 91,125
AT&T Corp., 7.125%, Due January, 2002 100,000 100,708
Edison International, 7.375%, Due December, 2003 100,000 99,079
General Telephone SE, 7.625%, Due July, 2002 # 100,000 100,831
Illinois Bell Telephone, 7.625%, Due April, 2006 # 100,000 100,860
Kansas City Power & Light, 7.40%, Due February , 2008 100,000 98,122
Ohio Bell Telephone, 6.75%, Due July, 2008 # 100,000 95,022
Pacific Bell, 7.00%, Due July, 2004 100,000 98,650
South Carolina Electric & Gas, 6.00%, Due June, 2000 100,000 96,534
United Telecommunications, 9.50%, Due April, 2003 100,000 111,646
------------ ------------
1,000,000 992,577
------------ ------------
Total Bonds 45.90% $ 6,092,460 6,194,315
============ ------------
Total Investments 95.80% 12,928,200
Other Assets and
Liabilities, Net 4.20% 566,850
------------
Net Assets 100.00% $ 13,495,050
============
# - Callable at the option of the issuer.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund
Statement of Operations and Changes in Net Assets
For the Six Months Ended June 30, 1996
(Unaudited)
Common Money Asset
Stock Market Bond Allocation
Portfolio Portfolio Portfolio Portfolio
------------ ----------- ----------- ------------
<S> <C> <C> <C> <C>
Investment income:
Income:
Dividends $ 349,554 $ - $ - $ 120,000
Interest 14,461 160,804 107,957 244,115
------------ ----------- ----------- ------------
Total income 364,015 160,804 107,957 364,115
------------ ----------- ----------- ------------
Expenses:
Management fee 26,238 7,257 3,719 17,362
Other administrative 52,474 14,514 7,439 34,723
------------ ----------- ----------- ------------
Total expenses 78,712 21,771 11,158 52,085
------------ ----------- ----------- ------------
Net investment income 285,303 139,033 96,799 312,030
------------ ----------- ----------- ------------
Realized and unrealized gains (losses)
on investments:
Net proceeds from sales 8,074,146 698,279 918,932 4,010,793
Cost of securities sold (6,263,226) (698,292) (919,907) (3,305,618)
------------ ----------- ----------- ------------
Net realized gains (losses) on investments 1,810,920 (13) (975) 705,175
Net unrealized losses on investments (105,261) - (177,723) (529,486)
------------ ----------- ----------- ------------
Net gains (losses) on investments 1,705,659 (13) (178,698) 175,689
------------ ----------- ----------- ------------
Net increase (decrease) in net
assets resulting from operations 1,990,962 139,020 (81,899) 487,719
Distributions to shareholders from:
Net investment income (269,329) (139,020) (95,329) (303,277)
Capital share transactions (358,332) 18,448 (263,565) (365,171)
------------ ----------- ----------- ------------
Net increase (decrease) in net assets 1,363,301 18,448 (440,793) (180,729)
Net assets, beginning of period 19,968,336 5,819,470 3,068,825 13,675,779
------------ ----------- ----------- ------------
Net assets, end of period $ 21,331,637 $ 5,837,918 $ 2,628,032 $ 13,495,050
============ =========== =========== ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund
Statement of Operations and Changes in Net Assets
For the Six Months Ended June 30, 1995
(Unaudited)
Common Money Asset
Stock Market Bond Allocation
Portfolio Portfolio Portfolio Portfolio
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Investment income:
Income:
Dividends $ 289,742 $ - $ - $ 101,698
Interest 32,094 176,768 98,087 224,782
------------ ------------ ------------ ------------
Total income 321,836 176,768 98,087 326,480
Expenses:
Management fee 100 39 17 72
Other administrative 40,437 14,489 6,463 27,916
------------ ------------ ------------ ------------
Total expenses 40,537 14,528 6,480 27,988
------------ ------------ ------------ ------------
Net investment income 281,299 162,240 91,607 298,492
------------ ------------ ------------ ------------
Realized and unrealized gains
and (losses) on investments:
Net proceeds from sales 3,310,249 - 256,794 1,460,632
Cost of securities sold (2,937,719) - (250,309) (1,321,377)
------------ ------------ ------------ ------------
Net realized gains on investments 372,530 - 6,485 139,255
Net unrealized gains on investments 1,846,830 - 188,550 1,087,013
------------ ------------ ------------ ------------
Net gains on investments 2,219,360 - 195,035 1,226,268
------------ ------------ ------------ ------------
Net increase in net assets
resulting from operations 2,500,659 162,240 286,642 1,524,760
Distributions to shareholders from:
Net investment income (254,883) (160,530) (89,872) (285,508)
Capital share transactions 258,921 (118,391) 176,759 243,177
------------ ------------ ------------ ------------
Net increase (decrease) in net assets 2,504,697 (116,681) 373,529 1,482,429
Net assets, beginning of period 14,687,489 5,752,426 2,484,720 10,548,284
------------ ------------ ------------ ------------
Net assets, end of period $ 17,192,186 $ 5,635,745 $ 2,858,249 $ 12,030,713
============ ============ ============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
USLICO Series Fund - Notes to Financial Statements - June 30, 1996
(1) Organization - USLICO Series Fund (the Fund) is an open-end, diversified
management investment company registered under the Investment Company Act of
1940 and consisting of four separate series (Portfolios), each of which has
its own investment objectives and policies. The Fund was organized as a
business trust under the laws of Massachusetts on January 19, 1988. Shares of
the Portfolios are sold only to separate accounts of United Services Life
Insurance Company (United Services) and Bankers Security Life Insurance
Society (Bankers Security) to serve as the investment medium for variable life
insurance policies issued by these companies. The separate accounts invest in
shares of one or more of the Portfolios, in accordance with allocation
instructions received from policyowners. Each Portfolio share outstanding
represents a beneficial interest in the respective Portfolio and carries a par
value of $.001. The Fund has an unlimited number of shares authorized.
(2) Summary of Significant Accounting Policies
(a) Valuation of Investments
1. Common Stock, Bond and Asset Allocation Portfolios - Equity
securities for which market quotations are readily available are stated at
that fair value. Fair value is determined on the basis of last reported sales
price, or, if no sales are reported, the latest available bid price obtained
from a quotation reporting system or from established market makers. Money
market instruments are valued at fair value, except that instruments maturing
in sixty days or less are valued using amortized cost which approximates fair
value. Debt securities (other than obligations having a maturity of sixty
days or less at their date of acquisition) are valued on the basis of market
quotations obtained from brokers and dealers or pricing services, which take
into account appropriate factors such as institutional-size trading in similar
groups of securities, yield, quality, coupon rate, maturity, type of issue,
trading characteristics, and other market data. Debt obligations having a
maturity of sixty days or less are generally valued at amortized cost, which
approximates fair value.
2. Money Market Portfolio - Investment securities held by the Money
Market Portfolio are all carried at amortized cost.
(b) Income Recognition - Dividend income is recorded on the ex-dividend
date. Interest income is accrued daily. Realized gains and losses on the
sale of securities are computed on the basis of the identified cost of the
related securities sold and are recognized at the date of trade.
(c) Other Administrative Fees - Other administrative fees are charged to
the Portfolios at an annual percentage rate of .5%. Fund expenses directly
attributable to a Portfolio are charged to that Portfolio. All other expenses
are allocated proportionately among all Portfolios in relation to respective
net assets.
(d) Federal Income Taxes - Each Portfolio intends to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code.
Accordingly, a Portfolio will not be subject to Federal income taxes if it
makes distributions of net investment income and net realized gains in
compliance with subchapter M and meets certain other requirements. (Normally,
however, such distributions are automatically reinvested in additional
portfolio shares.) As the Fund is believed to be in compliance with these
requirements, no federal income tax provision has been provided.
(e) Management Fees - The Fund's investment advisers are compensated with a
quarterly management fee based on an annual percentage of the average daily
net assets of each Portfolio. During 1996 and 1995, the adviser was paid a
fee at an annual rate of .25% of the net asset value of the Portfolios except
for the period from January 1, 1995 to June 30, 1995 during which no
investment advisory fee was charged pending approval of new advisory
agreements which were received on June 30, 1995. The maximum management fee
which may be charged is an annual percentage rate of .50% on the first $100
million of average daily net assets and .45% of average daily net assets in
excess thereof.
(f) Contributions and Withdrawals - Net funds contributed into or withdrawn
from the Fund are made on the basis of the net asset value per share
prevailing at the close of business on the preceding business day.
(3) Affiliations and Related Party Transactions - United Services and Bankers
Security are indirect wholly-owned subsidiaries of ReliaStar Financial Corp.
("ReliaStar"), an insurance holding company based in Minneapolis, Minnesota.
Washington Square Advisers, Inc., previously Washington Square Capital, Inc.,
a direct wholly-owned ReliaStar subsidiary, serves as investment adviser to
the Fund. The Fund's distributor, ReliaStar Financial Marketing Corporation,
previously known as USLICO Securities Corp., is also a direct wholly-owned
ReliaStar subsidiary. Newbold's Asset Management, Inc. serves as investment
sub-adviser for the Common Stock Portfolio and the common stock portion of the
Asset Allocation Portfolio. The Fund purchases securities through Newbold's
Asset Management, Inc. in the normal course of business.
Officers of the Fund are also officers of ReliaStar, ReliaStar Financial
Marketing Corporation, United Services and Bankers Security and receive
compensation therefrom. They do not receive additional compensation for
services rendered to the Fund. Trustees of the Board receive a fee of $500
for each meeting attended. For the six month periods ended June 30, 1996 and
1995, total fees paid to the Trustees aggregated $3,000 in both periods for
all Portfolios combined.
<PAGE>
(4) Investments - As of June 30, 1996, net unrealized appreciation
(depreciation) for each portfolio was as follows:
Net
Unrealized
Appreciation
Portfolio Appreciation Depreciation (Depreciation)
------------ ------------ ------------ ------------
Common Stock $2,894,759 $ (43,653) $2,851,106
Money Market N/A N/A N/A
Bond 34,485 (54,136) (19,651)
Asset Allocation 970,501 (176,940) 793,561
(5) Capital Share Transactions - Transactions in capital stock for the six-
month periods ended June 30, were as follows:
<TABLE>
SHARES AMOUNT
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Common Stock Portfolio:
Shares sold............ - 339 $ - $ 4,038
Shares issued in reinvestment
of dividends........... 19,779 21,986 269,329 254,883
------ ------ ------- -------
19,779 22,325 269,329 258,921
Shares redeemed....... (45,635) - (627,661) -
------ ------ ------- -------
Net increase(decrease) (25,856) 22,235 $ (358,332) $ 258,921
====== ====== ======= =======
Money Market Portfolio:
Shares sold.......... - - $ - $ -
Shares issued in reinvestment
of dividends ......... 139,020 162,240 139,020 162,240
------- ------- ------- -------
139,020 162,240 139,020 162,240
Shares redeemed....... (120,572) (278,921) (120,572) (278,921)
------- ------- ------- -------
Net increase(decrease 18,448 (116,681) $ 18,448 $ (116,681)
====== ======= ======= ========
Bond Portfolio:
Shares sold........... - 8,422 $ - $ 86,887
Shares issued in reinvestment
of dividends.......... 9,462 8,795 95,329 89,872
----- ------ ------ -------
9,462 17,217 95,329 176,759
Shares redeemed........ (36,142) - (358,894) -
------ ------ ------- -------
Net increase(decrease) (26,680) 17,217 $ (263,565) $ 176,759
====== ====== ======= =======
Asset Allocation Portfolio:
Shares sold........... - - $ - $ -
Shares issued in reinvestment
of dividends.......... 25,062 25,389 303,277 285,508
------ ------ ------- -------
25,062 25,389 303,277 285,508
Shares redeemed....... (55,106) (3,664) (668,448) (42,331)
------ ------ ------- -------
Net increase(decrease) (30,044) 21,725 $ (365,171) $ 243,177
====== ====== ======= =======
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund
Condensed Financial Information
For the Six Months Ended June 30, 1996
(Unaudited)
Common Money Asset
Stock Market Bond Allocation
Portfolio Portfolio Portfolio Portfolio
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS (per share)
Net asset value, beginning of period $ 12.62 $ 1.00 $ 10.38 $ 11.82
Income from investment operations:
Net investment income 0.18 0.02 0.32 0.27
Net realized and unrealized
gains (losses) on securities 1.08 - (0.61) 0.14
----------- ----------- ----------- -----------
Total from investment operations 1.26 0.02 (0.29) 0.41
Distributions:
Distribution of income (0.17) (0.02) (0.32) (0.26)
Distribution of capital gains - - - -
----------- ----------- ----------- -----------
Net asset value, end of period $ 13.71 $ 1.00 $ 9.77 $ 11.97
=========== =========== =========== ===========
Total return 9.98% 2.00% (2.79%) 3.47%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $21,331,637 $ 5,837,918 $ 2,628,032 $13,495,050
Expenses to average net assets 0.37% 0.37% 0.37% 0.37%
Net investment income to average net assets 1.36% 2.38% 3.25% 2.25%
Portfolio turnover rate 38.57% N/A 18.37% 29.82%
Weighted average number of shares outstanding
for six months ended June 30, 1996 1,585,079 5,886,655 297,054 1,161,799
For the Six Months Ended June 30, 1995
(Unaudited)
FINANCIAL HIGHLIGHTS (per share)
Net asset value, beginning of period $ 10.37 $ 1.00 $ 9.41 $ 10.18
Income from investment operations:
Net investment income 0.20 0.03 0.35 0.28
Net realized and unrealized
gains on securities 1.56 - 0.74 1.18
----------- ----------- ----------- -----------
Total from investment operations 1.76 0.03 1.09 1.46
Distributions:
Distribution of income (0.18) (0.03) (0.33) (0.27)
Distribution of capital gains - - - -
----------- ----------- ----------- -----------
Net asset value, end of period $ 11.95 $ 1.00 $ 10.17 $ 11.37
=========== =========== =========== ===========
Total return 16.97% 3.00% 11.58% 14.34%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $17,192,186 $ 5,635,745 $ 2,858,249 $12,030,713
Expenses to average net assets 0.25% 0.25% 0.25% 0.25%
Net investment income to average net assets 1.76% 2.80% 3.47% 2.64%
Portfolio turnover rate 22.18% N/A 8.39% 13.58%
Weighted average number of shares outstanding
for six months ended June 30, 1995 1,422,300 5,809,244 266,922 1,042,143
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund
Condensed Financial Information
For the Six Months Ended June 30, 1994
(Unaudited)
Common Money Asset
Stock Market Bond Allocation
Portfolio Portfolio Portfolio Portfolio
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS (per share)
Net asset value, beginning of period $ 11.23 $ 1.00 $ 10.49 $ 11.26
Income from investment operations:
Net investment income 0.17 0.01 0.33 0.28
Net realized and unrealized
losses on securities (0.30) - (0.66) (0.58)
----------- ----------- ----------- -----------
Total from investment operations (0.13) 0.01 (0.33) (0.30)
Distributions:
Distribution of income (0.16) (0.01) (0.31) (0.26)
Distribution of capital gains - - - -
----------- ----------- ----------- -----------
Net asset value, end of period $ 10.94 $ 1.00 $ 9.85 $ 10.70
=========== =========== =========== ===========
Total return (1.16%) 1.00% (3.15%) (2.66%)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $13,106,990 $ 5,541,252 $ 2,548,853 $ 9,643,909
Expenses to average net assets 0.37% 0.37% 0.37% 0.37%
Net investment income to average net assets 1.51% 1.43% 3.24% 2.49%
Portfolio turnover rate 27.89% N/A 4.61% 12.40%
Weighted average number of shares outstanding
for six months ended June 30, 1994 1,127,581 5,422,913 252,884 830,763
For the Six Months Ended June 30, 1993
(Unaudited)
FINANCIAL HIGHLIGHTS (per share)
Net asset value, beginning of period $ 10.45 $ 1.00 $ 10.21 $ 10.71
Income from investment operations:
Net investment income 0.17 0.01 0.35 0.28
Net realized and unrealized
gains on securities 0.35 - 0.40 0.46
----------- ----------- ----------- -----------
Total from investment operations 0.52 0.01 0.75 0.74
Distributions:
Distribution of income (0.06) (0.01) (0.11) (0.09)
Distribution of capital gains - - - -
----------- ----------- ----------- -----------
Net asset value, end of period $ 10.91 $ 1.00 $ 10.85 $ 11.36
=========== =========== =========== ===========
Total return 4.98% 1.00% 7.35% 6.91%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $11,674,302 $ 5,306,436 $ 2,543,750 $ 8,742,478
Expenses to average net assets 0.37% 0.37% 0.46% 0.47%
Net investment income to average net assets 1.59% 1.20% 3.30% 2.53%
Portfolio turnover rate 25.23% N/A 4.01% 14.33%
Weighted average number of shares outstanding
for six months ended June 30, 1993 1,061,127 5,433,747 244,192 755,706
</TABLE>
<PAGE>
<TABLE>
USLICO Series Fund
Condensed Financial Information
For the Six Months Ended June 30, 1992
(Unaudited)
Common Money Asset
Stock Market Bond Allocation
Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- -----------
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS (per share)
Net asset value, beginning of period $ 10.55 $ 1.00 $ 10.21 $ 10.71
Income from investment operations:
Net investment income 0.19 0.02 0.37 0.30
Net realized and unrealized
gains (losses) on securities 0.29 - (0.04) 0.11
----------- ----------- ----------- -----------
Total from investment operations 0.48 0.02 0.33 0.41
Distributions:
Distribution of income (0.27) (0.02) (0.36) (0.29)
Distribution of capital gains - - - (0.02)
----------- ----------- ----------- -----------
Net asset value, end of period $ 10.76 $ 1.00 $ 10.18 $ 10.81
=========== =========== =========== ===========
Total return 4.55% 2.00% 3.23% 3.83%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $10,536,614 $ 5,434,077 $ 2,381,966 $ 7,151,812
Expenses to average net assets 0.47% 0.37% 0.38% 0.41%
Net investment income to average net assets 1.83% 1.66% 3.67% 2.82%
Portfolio turnover rate 21.62% N/A 24.04% 15.05%
Weighted average number of shares outstanding
for six months ended June 30, 1992 959,624 5,322,916 237,885 620,688
</TABLE>
