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[LOGO]
NATIONWIDE(R)
VA SEPARATE ACCOUNT-A
SEMI-ANNUAL REPORT
TO
CONTRACT OWNERS
JUNE 30, 2000
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY
HOME OFFICE: COLUMBUS, OHIO
FHL-108-Y (06/00)
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[LOGO]
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43215-2220
[PHOTO]
PRESIDENT'S MESSAGE
We at Nationwide Life and Annuity Insurance Company are pleased to bring
you the 2000 semi-annual report of the Nationwide VA Separate Account-A.
During the first half of 2000 fixed income and equity markets took a hiatus
from their recent advances. It appears the Federal Reserve's interest rate
hikers are accomplishing the intended purpose. Recent economic statistics show
some moderation in the areas of home and vehicles sales because of the higher
interest costs. And, there are other favorable indications that the Fed may yet
"glide" the economy to a soft landing. Inflation remains low. Sustained
increases in worker productivity continue to dampen pricing pressures of an
increasingly tight labor pool. Corporate profitability growth remains viable.
An improving global economy bodes well for U.S. exporting businesses. While
all this provides a positive backdrop, we expect the markets will continue
jittery and volatile during the second half of the year as uncertainty over
further Fed actions persists. However, we believe patient investors in financial
assets will be amply rewarded when we move beyond this temporary respite.
Nationwide Life was a forerunner in the variable annuity and variable life
insurance business. We continue to develop new and innovative investment
products to better meet your financial planning and retirement needs. And, we
are equally committed to providing you, our valued customer, the exceptional
level of customer service you expect and deserve.
/s/ Joseph J. Gasper
Joseph J. Gasper, President
August 16, 2000
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[THIS PAGE LEFT BLANK INTENTIONALLY]
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HOW TO READ THE SEMI-ANNUAL REPORT
This semi-annual report is a presentation of the variable account as a
whole and only describes the underlying contracts and products of the variable
account in general terms. Please note the variable account may have more than
one variable product available. Such products may have different underlying
mutual funds available than those available in your contract. Therefore, not
all funds listed in this report may be available in your contract. Please
refer to your most recent account statement for specific information about your
investment in the Nationwide VA Separate Account-A. Rules and regulations of the
United States Securities and Exchange Commission and recognized conventions of
Generally Accepted Accounting Principals prescribe the format and content of
this report.
We also invite you to call our service center at 1-800-321-9332 if you have
questions about your account, or you may access your account using our voice
response unit. And, please visit our web-site at www.nwservicecenter.com for
additional information about your contract and to learn more about other
products and services offered by Nationwide Financial.
The Annual Report has four major financial sections:
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNER'S EQUITY
This statement begins on page 6 and lists all of the underlying mutual funds of
the variable account, the number of shares owned, the amount paid for the shares
and their market value as of the close of business on June 30, 2000. The mutual
funds are listed in alphabetical order. The market value of the assets changes
as the underlying mutual funds change in value. As contract owners make
exchange transactions between the funds, the number of shares increases or
decreases accordingly. When money is deposited or withdrawn by a contract
owner, shares are correspondingly purchased or redeemed. The total market value
of the funds is equal to the TOTAL INVESTMENTS of the variable account.
ACCOUNTS RECEIVABLE, if applicable, represents an asset of the variable account
for money market fund shares purchased by contract owners and reinvested
dividend shares added to contract owners' accounts, but not yet added to Total
investments. Total investments plus Accounts receivable equal TOTAL ASSETS of
the variable account.
ACCOUNTS PAYABLE, if applicable, is a liability of the variable account for
money market fund shares redeemed by contract owners' but not yet deducted from
Total investments.
Total assets minus Accounts payable equals CONTRACT OWNERS' EQUITY. A summary of
Contract owners' equity by funds series may be found on page 7. This summary
also includes investment return for the reporting period for each fund series.
STATEMENTS OF OPERATIONS AND STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
These statements begin on page 8 and present the financial activity of each
underlying mutual fund sub-account of the variable account, for the periods
indicated.
The INVESTMENT ACTIVITY section shows income to the variable account for
reinvested dividends and capital gain distributions paid by the underlying
mutual funds. Also shown are the mortality, expense and administration charges
which are assessed through the daily unit value calculation and which represent
an expense to the variable account and its contract owners. This section also
shows the realized gain or loss as mutual fund shares are sold, and the change
in unrealized gain or loss, which represents the changes in market value of the
underlying fund shares.
The EQUITY TRANSACTIONS section illustrates the receipt of purchase payments, as
new contracts are sold or additional payments made to existing contracts. Also
presented are deductions from the variable account when the contract owners
withdraw money.
The sum of the above two sections represents the NET CHANGE IN CONTRACT OWNERS'
EQUITY which when added to the beginning Contract owners' equity equals Contract
owners' equity at the end of the reporting period.
Notes to Financial Statements, beginning on page 12, provide further disclosures
about the variable account and its underlying contract provisions.
5
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NATIONWIDE VA SEPARATE ACCOUNT-A
STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS' EQUITY
JUNE 30, 2000
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments at market value:
American Century VP - American Century VP Advantage (ACVPAdv)
1,691,314 shares (cost $10,215,218)............................................................ $ 10,215,535
American Century VP - American Century VP Balanced (ACVPBal)
51,095 shares (cost $383,186).................................................................. 386,274
Federated IS - Federated American Leaders Fund II (FedAmLead)
1,634 shares (cost $28,197).................................................................... 31,351
Federated IS - Federated High Income Bond Fund II (FedHiInc)
15,758 shares (cost $159,950).................................................................. 143,715
Fidelity VIP - Equity-Income Portfolio (FidVIPEI)
9,494 shares (cost $238,032)................................................................... 217,516
Fidelity VIP - Growth Portfolio (FidVIPGr)
2,281,033 shares (cost $75,647,067)............................................................ 117,564,441
Fidelity VIP - Overseas Portfolio (FidVIPOv)
1,551 shares (cost $31,768).................................................................... 36,390
MFS(R) VIT - Emerging Growth Series (MFSEmGrSe)
7,170 shares (cost $245,465)................................................................... 251,303
MFS(R) VIT - Total Return Series (MFSTotReSe)
1,639 shares (cost $24,577).................................................................... 28,412
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
466,767 shares (cost $11,051,854).............................................................. 12,070,603
Nationwide SAT - Government Bond Fund (NSATGvtBd)
1,641,284 shares (cost $18,397,397)............................................................ 17,873,582
Nationwide SAT - Money Market Fund (NSATMyMkt)
3,588,668 shares (cost $3,588,668)............................................................. 3,588,668
Nationwide SAT - Total Return Fund (NSATTotRe)
3,226,490 shares (cost $44,110,203)............................................................ 62,561,635
Neuberger Berman AMT - Balanced Portfolio (NBAMTBal)
1,439,394 shares (cost $23,737,419)............................................................ 28,744,707
-------------
Total investments.......................................................................... 253,714,132
Accounts receivable................................................................................. 20,628
-------------
Total assets............................................................................... 253,734,760
ACCOUNTS PAYABLE....................................................................................... 4,376
-------------
CONTRACT OWNERS' EQUITY................................................................................ $ 253,730,384
=============
</TABLE>
6
<PAGE> 6
<TABLE>
<CAPTION> PERIOD
Contract owners' equity represented by: UNITS UNIT VALUE RETURN*
-------- ---------- ---------
<S> <C> <C> <C> <C>
Contracts in accumulation phase:
VA contracts:
American Century VP - American Century
VP Advantage:
Tax qualified................................. 269,464 $ 21.233728 $ 5,721,725 3%
Non-tax qualified............................. 206,114 21.233728 4,376,569 3%
American Century VP - American Century
VP Balanced:
Tax qualified................................. 13,234 10.639973 140,809 1%
Non-tax qualified............................. 23,070 10.639973 245,464 1%
Fidelity VIP - Growth Portfolio:
Tax qualified................................. 1,477,914 46.446933 68,644,573 4%
Non-tax qualified............................. 1,048,535 46.446933 48,701,235 4%
Nationwide SAT - Capital Appreciation Fund:
Tax qualified................................. 207,242 31.543238 6,537,084 0%
Non-tax qualified............................. 175,434 31.543238 5,533,756 0%
Nationwide SAT - Government Bond Fund:
Tax qualified................................. 458,476 21.067794 9,659,078 3%
Non-tax qualified............................. 389,926 21.067794 8,214,881 3%
Nationwide SAT - Money Market Fund:
Tax qualified................................. 115,760 15.615837 1,807,689 2%
Non-tax qualified............................. 114,060 15.615837 1,781,142 2%
Nationwide SAT - Total Return Fund:
Tax qualified................................. 939,466 36.959810 34,722,485 3%
Non-tax qualified............................. 750,670 36.959810 27,744,621 3%
Neuberger Berman AMT - Balanced Portfolio:
Tax qualified................................. 542,458 28.311080 15,357,572 10%
Non-tax qualified............................. 458,999 28.311080 13,306,179 10%
VA-II Eagle Choice contracts:
Federated IS - Federated American
Leaders Fund II:
Non-tax qualified............................. 1,743 17.987361 31,352 (5)%
Federated IS- Federated High Income
Bond Fund II:
Non-tax qualified............................. 11,430 12.573407 143,714 (3)%
Fidelity VIP - Equity-Income Portfolio:
Tax qualified................................. 870 21.370448 18,592 (3)%
Non-tax qualified............................. 9,308 21.370448 198,916 (3)%
Fidelity VIP - Overseas Portfolio:
Non-tax qualified............................. 2,025 17.972161 36,394 (6)%
MFS(R) VIT - Emerging Growth Series:
Non-tax qualified............................. 8,098 31.045757 251,409 (3)%
MFS(R) VIT - Total Return Series:
Non-tax qualified............................. 1,840 15.438516 28,407 2%
======== =========
Reserves for annuity contracts in payout phase:
Tax qualified................................. 347,594
Non-tax qualified............................. 179,144
-------------
$ 253,730,384
=============
</TABLE>
*The period return does not include contract charges satisfied by surrendering
units.
See accompanying notes to financial statements.
7
<PAGE> 7
NATIONWIDE VA SEPARATE ACCOUNT-A
STATEMENTS OF CHANGES IN
CONTRACT OWNERS' EQUITY
STATEMENTS OF OPERATIONS
SIX MONTH PERIODS ENDED JUNE 30, 2000 AND 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Total ACVPAdv
------------------------------ -----------------------------
2000 1999 2000 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................ $ 1,847,886 2,256,759 305,386 368,099
Mortality, expense and administration
charges (note 2):
VA ....................................... (1,743,777) (1,876,177) (71,370) (82,747)
VA II Convertible ........................ (5,042) (4,469) - -
------------- ------------- ------------- -------------
Net investment activity ....................... 99,067 376,113 234,016 285,352
------------- ------------- ------------- -------------
Proceeds from mutual fund shares sold ........... 52,377,702 37,526,427 1,901,864 2,126,728
Cost of mutual fund shares sold ................. (33,554,223) (26,030,793) (1,691,739) (1,695,102)
------------- ------------- ------------- -------------
Realized gain (loss) on investments ........... 18,823,479 11,495,634 210,125 431,626
Change in unrealized gain (loss) on investments . (28,183,389) (784,127) (1,985,076) (1,191,345)
------------- ------------- ------------- -------------
Net gain (loss) on investments ................ (9,359,910) 10,711,507 (1,774,951) (759,719)
------------- ------------- ------------- -------------
Reinvested capital gains ........................ 19,447,646 13,388,266 1,903,692 873,779
------------- ------------- ------------- -------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 10,186,803 24,475,886 362,757 399,412
------------- ------------- ------------- -------------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ............................... 1,908,117 3,408,107 60,566 160,498
Transfers between funds ......................... - - 27,392 39,039
Redemptions ..................................... (45,529,170) (28,239,167) (1,862,911) (1,431,017)
Annuity benefits ................................ (17,039) (16,005) (2,970) (2,709)
Annual contract maintenance charge (note 2) ..... (132,762) (149,347) (7,190) (9,117)
Contingent deferred sales charges (note 2) ...... (194,962) (256,428) (4,871) (13,888)
Adjustments to maintain reserves ................ 17,368 (2,735) (117,259) (9,414)
------------- ------------- ------------- -------------
Net equity transactions .................... (43,948,448) (25,255,575) (1,907,243) (1,266,608)
------------- ------------- ------------- -------------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............. (33,761,645) (779,689) (1,544,486) (867,196)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ....... 287,492,029 291,740,512 11,642,764 13,548,557
------------- ------------- ------------- -------------
CONTRACT OWNERS' EQUITY END OF PERIOD ............. $ 253,730,384 290,960,823 10,098,278 12,681,361
============= ============= ============= =============
<CAPTION>
ACVPBal FedAmLead
------------------------------- ------------------------------
2000 1999 2000 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................ 3,762 - 299 292
Mortality, expense and administration
charges (note 2):
VA ....................................... (1,506) - - -
VA II Convertible ........................ - - (222) (230)
------------- ------------- ------------- -------------
Net investment activity ....................... 2,256 - 77 62
------------- ------------- ------------- -------------
Proceeds from mutual fund shares sold ........... 9,296 - 228 232
Cost of mutual fund shares sold ................. (9,351) - (177) (164)
------------- ------------- ------------- -------------
Realized gain (loss) on investments ........... (55) - 51 68
Change in unrealized gain (loss) on investments . 1,774 - (2,654) 578
------------- ------------- ------------- -------------
Net gain (loss) on investments ................ 1,719 - (2,603) 646
------------- ------------- ------------- -------------
Reinvested capital gains ........................ 2,369 - 904 2,940
------------- ------------- ------------- -------------
Net increase (decrease) in contract owners'
equity resulting from operations ......... 6,344 - (1,622) 3,648
------------- ------------- ------------- -------------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ............................... - - - -
Transfers between funds ......................... 301,541 - - -
Redemptions ..................................... (7,859) - - -
Annuity benefits ................................ - - - -
Annual contract maintenance charge (note 2) ..... (60) - - -
Contingent deferred sales charges (note 2) ...... - - - -
Adjustments to maintain reserves ................ 119,218 - (1) (3)
------------- ------------- ------------- -------------
Net equity transactions .................... 412,840 - (1) (3)
------------- ------------- ------------- -------------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............. 419,184 - (1,623) 3,645
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ....... 86,309 - 32,973 31,352
------------- ------------- ------------- -------------
CONTRACT OWNERS' EQUITY END OF PERIOD ............. 505,493 - 31,350 34,997
============= ============= ============= =============
</TABLE>
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NATIONWIDE VA SEPARATE ACCOUNT-A
STATEMENTS OF CHANGES IN
CONTRACT OWNERS' EQUITY, CONTINUED
STATEMENTS OF OPERATIONS, CONTINUED
SIX MONTH PERIODS ENDED JUNE 30, 2000 AND 1999
(UNAUDITED)
<TABLE>
<CAPTION>
FedHiInc FidVIPEI
-------------------- --------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................. $ 13,444 11,613 3,789 3,250
Mortality, expense and administration
charges (note 2):
VA ........................................ - - - -
VA II Convertible ......................... (1,018) (1,054) (1,522) (1,590)
------------ ------- ------- -------
Net investment activity ........................ 12,426 10,559 2,267 1,660
------------ ------- ------- -------
Proceeds from mutual fund shares sold ............ 2,498 1,062 3,402 1,594
Cost of mutual fund shares sold .................. (2,793) (993) (3,425) (1,219)
------------ ------- ------- -------
Realized gain (loss) on investments ............ (295) 69 (23) 375
Change in unrealized gain (loss) on investments .. (16,031) (8,837) (24,074) 16,716
------------ ------- ------- -------
Net gain (loss) on investments ................. (16,326) (8,768) (24,097) 17,091
------------ ------- ------- -------
Reinvested capital gains ......................... - 996 14,277 7,183
------------ ------- ------- -------
Net increase (decrease) in contract owners'
equity resulting from operations .......... (3,900) 2,787 (7,553) 25,934
------------ ------- ------- -------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ................................ - - - -
Transfers between funds .......................... - - - -
Redemptions ...................................... (1,479) - (1,824) -
Annuity benefits ................................. - - - -
Annual contract maintenance charge (note 2) ...... - - - -
Contingent deferred sales charges (note 2) ....... - - - -
Adjustments to maintain reserves ................. 2 (1) 4 (2)
------------ ------- ------- -------
Net equity transactions ..................... (1,477) (1) (1,820) (2)
------------ ------- ------- -------
NET CHANGE IN CONTRACT OWNERS' EQUITY .............. (5,377) 2,786 (9,373) 25,932
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ........ 149,094 147,359 226,895 217,648
------------ ------- ------- -------
CONTRACT OWNERS' EQUITY END OF PERIOD .............. $ 143,717 150,145 217,522 243,580
============ ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
FidVIPGr FidVIPOv
--------------------- -----------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................. 135,854 187,709 520 424
Mortality, expense and administration
charges (note 2):
VA ........................................ (795,930) (719,580) - -
VA II Convertible ......................... - - (259) (197)
----------- ----------- ------ ------
Net investment activity ........................ (660,076) (531,871) 261 227
----------- ----------- ------ ------
Proceeds from mutual fund shares sold ............ 16,160,070 10,499,551 262 201
Cost of mutual fund shares sold .................. (7,092,039) (5,463,993) (190) (175)
----------- ----------- ------ ------
Realized gain (loss) on investments ............ 9,068,031 5,035,558 72 26
Change in unrealized gain (loss) on investments .. (16,713,789) (2,188,439) (5,820) 1,084
----------- ----------- ------ ------
Net gain (loss) on investments ................. (7,645,758) 2,847,119 (5,748) 1,110
----------- ----------- ------ ------
Reinvested capital gains ......................... 13,517,429 11,802,217 3,274 684
----------- ----------- ------ ------
Net increase (decrease) in contract owners'
equity resulting from operations .......... 5,211,595 14,117,465 (2,213) 2,021
------------ ----------- ------ ------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ................................ 863,077 1,120,167 - -
Transfers between funds .......................... 2,220,078 630,986 - -
Redemptions ...................................... (16,959,232) (9,499,161) - -
Annuity benefits ................................. (7,637) (6,040) - -
Annual contract maintenance charge (note 2) ...... (56,572) (56,374) - -
Contingent deferred sales charges (note 2) ....... (65,768) (99,232) - -
Adjustments to maintain reserves ................. 8,821 4,178 1 (1)
----------- ----------- ------ ------
Net equity transactions ..................... (13,997,233) (7,905,476) 1 (1)
----------- ----------- ------ ------
NET CHANGE IN CONTRACT OWNERS' EQUITY .............. (8,785,638) 6,211,989 (2,212) 2,020
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ........ 126,357,433 106,705,766 38,602 27,452
----------- ----------- ------ ------
CONTRACT OWNERS' EQUITY END OF PERIOD .............. 117,571,795 112,917,755 36,390 29,472
=========== =========== ====== ======
</TABLE>
(Continued)
9
<PAGE> 9
NATIONWIDE VA SEPARATE ACCOUNT-A
STATEMENTS OF CHANGES IN
CONTRACT OWNERS' EQUITY, CONTINUED
STATEMENTS OF OPERATIONS, CONTINUED
SIX MONTH PERIODS ENDED JUNE 30, 2000 AND 1999
(UNAUDITED)
<TABLE>
<CAPTION>
MFSEmGrSe MFSTotReSe
-------------------------- --------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................ $ - - 695 500
Mortality, expense and administration
charges (note 2):
VA ....................................... - - - -
VA II Convertible ........................ (1,827) (1,204) (194) (194)
----------- ----------- ----------- -----------
Net investment activity ....................... (1,827) (1,204) 501 306
----------- ----------- ----------- -----------
Proceeds from mutual fund shares sold ........... 4,519 1,207 195 196
Cost of mutual fund shares sold ................. (2,310) (730) (155) (149)
----------- ----------- ----------- -----------
Realized gain (loss) on investments ........... 2,209 477 40 47
Change in unrealized gain (loss) on investments . (21,855) 20,483 (678) (77)
----------- ----------- ----------- -----------
Net gain (loss) on investments ................ (19,646) 20,960 (638) (30)
----------- ----------- ----------- -----------
Reinvested capital gains ........................ 13,664 - 669 928
----------- ----------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ......... (7,809) 19,756 532 1,204
----------- ----------- ----------- -----------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ............................... - - - -
Transfers between funds ......................... - - - -
Redemptions ..................................... (2,696) - - -
Annuity benefits ................................ - - - -
Annual contract maintenance charge (note 2) ..... - - - -
Contingent deferred sales charges (note 2) ...... - - - -
Adjustments to maintain reserves ................ 118 2 1 (1)
----------- ----------- ----------- -----------
Net equity transactions .................... (2,578) 2 1 (1)
----------- ----------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS' EQUITY .............. (10,387) 19,758 533 1,203
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ........ 261,807 164,323 27,880 27,423
----------- ----------- ----------- -----------
CONTRACT OWNERS' EQUITY END OF PERIOD .............. $ 251,420 184,081 28,413 28,626
=========== =========== =========== ===========
<CAPTION>
NSATCapAp NSATGvtBd
-------------------------- --------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends ............................ 23,324 51,916 562,920 748,218
Mortality, expense and administration
charges (note 2):
VA ....................................... (86,152) (120,598) (128,171) (188,289)
VA II Convertible ........................ - - - -
----------- ----------- ----------- -----------
Net investment activity ....................... (62,828) (68,682) 434,749 559,929
----------- ----------- ----------- -----------
Proceeds from mutual fund shares sold ........... 4,171,278 2,642,562 5,096,649 4,927,546
Cost of mutual fund shares sold ................. (2,610,838) (1,078,995) (5,048,544) (4,960,488)
----------- ----------- ----------- -----------
Realized gain (loss) on investments ........... 1,560,440 1,563,567 48,105 (32,942)
Change in unrealized gain (loss) on investments . (1,629,137) 489,216 149,610 (1,361,253)
----------- ----------- ----------- -----------
Net gain (loss) on investments ................ (68,697) 2,052,783 197,715 (1,394,195)
----------- ----------- ----------- -----------
Reinvested capital gains ........................ - - - -
----------- ----------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ......... (131,525) 1,984,101 632,464 (834,266)
----------- ----------- ----------- -----------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ............................... 179,230 468,917 75,767 339,190
Transfers between funds ......................... (897,512) 107,694 (739,051) (418,518)
Redemptions ..................................... (3,148,428) (1,518,018) (4,115,045) (3,719,807)
Annuity benefits ................................ - - (671) (2,125)
Annual contract maintenance charge (note 2) ..... (6,683) (8,442) (10,293) (14,328)
Contingent deferred sales charges (note 2) ...... (15,875) (13,032) (16,603) (22,089)
Adjustments to maintain reserves ................ 237 141 372 (53)
----------- ----------- ----------- -----------
Net equity transactions .................... (3,889,031) (962,740) (4,805,524) (3,837,730)
----------- ----------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS' EQUITY .............. (4,020,556) 1,021,361 (4,173,060) (4,671,996)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ........ 16,091,400 18,882,269 22,047,018 31,359,014
----------- ----------- ----------- -----------
CONTRACT OWNERS' EQUITY END OF PERIOD .............. 12,070,844 19,903,630 17,873,958 26,687,018
=========== =========== =========== ===========
</TABLE>
10
<PAGE> 10
NATIONWIDE VA SEPARATE ACCOUNT-A
STATEMENTS OF CHANGES IN
CONTRACT OWNERS' EQUITY, CONTINUED
STATEMENTS OF OPERATIONS, CONTINUED
SIX MONTH PERIODS ENDED JUNE 30, 2000 AND 1999
(UNAUDITED)
<TABLE>
<CAPTION>
NSATMyMkt NSATTotRe
---------------------- -------------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .............................. $ 120,367 104,216 173,497 334,832
Mortality, expense and administration
charges (note 2):
VA ......................................... (28,291) (29,785) (437,469) (565,579)
VA II Convertible .......................... - - - -
---------- ---------- ---------- ----------
Net investment activity ......................... 92,076 74,431 (263,972) (230,747)
---------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ............. 5,525,448 4,815,284 14,927,514 9,374,382
Cost of mutual fund shares sold ................... (5,525,448) (4,815,284) (8,112,119) (4,973,240)
---------- ---------- ---------- ----------
Realized gain (loss) on investments ............. - - 6,815,395 4,401,142
Change in unrealized gain (loss) on investments ... - - (5,140,194) 4,125,256
---------- ---------- ---------- ----------
Net gain (loss) on investments .................. - - 1,675,201 8,526,398
---------- ---------- ---------- ----------
Reinvested capital gains .......................... - - - 39,257
---------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........... 92,076 74,431 1,411,229 8,334,908
---------- ---------- ---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ................................. 228,480 90,404 334,774 1,018,199
Transfers between funds ........................... (6,658) 178,597 (1,935,734) (87,544)
Redemptions ....................................... (2,273,712) (854,310) (12,645,245) (8,707,022)
Annuity benefits .................................. - - (3,363) (3,398)
Annual contract maintenance charge (note 2) ....... (2,408) (2,796) (35,155) (42,917)
Contingent deferred sales charges (note 2) ........ (14,678) (10,521) (52,947) (70,390)
Adjustments to maintain reserves .................. (206) (14) 3,669 1,651
---------- ---------- ---------- ----------
Net equity transactions ...................... (2,069,182) (598,640) (14,334,001) (7,891,421)
---------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............... (1,977,106) (524,209) (12,922,772) 443,487
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ......... 5,565,940 4,642,551 75,488,020 88,031,080
---------- ---------- ---------- ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ............... $ 3,588,834 4,118,342 62,565,248 88,474,567
=========== ========= ========== ==========
</TABLE>
<TABLE>
<CAPTION>
NBAMTBal
-------------------------
2000 1999
---- ----
<S> <C> <C>
INVESTMENT ACTIVITY:
Reinvested dividends .............................. 504,029 445,690
Mortality, expense and administration
charges (note 2):
VA ......................................... (194,888) (169,599)
VA II Convertible .......................... - -
---------- ----------
Net investment activity ......................... 309,141 276,091
---------- ----------
Proceeds from mutual fund shares sold ............. 4,574,479 3,135,882
Cost of mutual fund shares sold ................... (3,455,095) (3,040,261)
---------- ----------
Realized gain (loss) on investments ............. 1,119,384 95,621
Change in unrealized gain (loss) on investments ... (2,795,465) (687,509)
---------- ----------
Net gain (loss) on investments .................. (1,676,081) (591,888)
---------- ----------
Reinvested capital gains .......................... 3,991,368 660,282
---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........... 2,624,428 344,485
---------- ----------
EQUITY TRANSACTIONS:
Purchase payments received from
contract owners ................................. 166,223 210,732
Transfers between funds ........................... 1,029,944 (450,254)
Redemptions ....................................... (4,510,739) (2,509,832)
Annuity benefits .................................. (2,398) (1,733)
Annual contract maintenance charge (note 2) ....... (14,401) (15,373)
Contingent deferred sales charges (note 2) ........ (24,220) (27,276)
Adjustments to maintain reserves .................. 2,391 782
---------- ----------
Net equity transactions ...................... (3,353,200) (2,792,954)
---------- ----------
NET CHANGE IN CONTRACT OWNERS' EQUITY ............... (728,772) (2,448,469)
CONTRACT OWNERS' EQUITY BEGINNING OF PERIOD ......... 29,475,894 27,955,718
---------- ----------
CONTRACT OWNERS' EQUITY END OF PERIOD ............... 28,747,122 25,507,249
========== ==========
</TABLE>
See accompanying notes to financial statements
11
<PAGE> 11
NATIONWIDE VA SEPARATE ACCOUNT-A
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2000 AND 1999
(UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Organization and Nature of Operations
Nationwide VA Separate Account-A (the Account) was established pursuant
to a resolution of the Board of Directors of Nationwide Life and
Annuity Insurance Company (the Company) on May 6, 1987. The Account has
been registered as a unit investment trust under the Investment Company
Act of 1940.
The Company offers tax qualified and non-tax qualified Individual
Deferred Variable Annuity Contracts through the Account. The primary
distribution for the contracts is through banks and other financial
institutions; however, other distributors may be utilized.
(b) The Contracts
Only contracts without a front-end sales charge, but with a contingent
deferred sales charge and certain other fees are offered for purchase.
See note 2 for a discussion of contract expenses.
With certain exceptions, contract owners in either the accumulation or
the payout phase may invest in any of the following funds:
Portfolio of the American Century Variable Portfolios, Inc.
(American Century VP);
American Century VP - American Century VP Advantage (ACVPAdv)
American Century VP - American Century VP Balanced (ACVPBal)
Funds of the Federated Insurance Series (Federated IS) (available
for VA-II Eagle Choice contracts);
Federated IS - Federated American Leaders Fund II (FedAmLead)
Federated IS - Federated High Income Bond Fund II (FedHiInc)
Portfolios of the Fidelity Variable Insurance Products Fund
(Fidelity VIP);
Fidelity VIP - Equity-Income Portfolio (FidVIPEI) (available
for VA-II Eagle Choice contracts)
Fidelity VIP - Growth Portfolio (FidVIPGr) (available for VA
contracts)
Fidelity VIP - Overseas Portfolio (FidVIPOv) (available for
VA-II Eagle Choice contracts)
Funds of the MFS(R) Variable Insurance Trust (MFS(R) VIT)
(available for VA-II Eagle Choice contracts);
MFS(R) VIT - Emerging Growth Series (MFSEmGrSe)
MFS(R) VIT - Total Return Series (MFSTotReSe)
Funds of the Nationwide Separate Account Trust (Nationwide SAT)
(managed for a fee by an affiliated investment advisor);
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
(available for VA contracts)
Nationwide SAT - Government Bond Fund (NSATGvtBd) (available
for all contracts)
Nationwide SAT - Money Market Fund (NSATMyMkt) (available for
all contracts)
Nationwide SAT - Small Company Fund (NSATSmCo) (available for
VA-II Eagle Choice contracts)
Nationwide SAT - Total Return Fund (NSATTotRe) (available for
VA contracts)
Portfolio of the Neuberger & Berman Advisers Management Trust
(Neuberger Berman AMT) (available for VA contracts);
Neuberger Berman AMT - Balanced Portfolio (NBAMTBal)
At June 30, 2000, contract owners have invested in all of the above
funds except the Nationwide SAT - Small Company Fund. The contract
owners' equity is affected by the investment results of each fund,
equity transactions by contract owners and certain contract expenses
(see note 2). The accompanying financial statements include only
contract owners' purchase payments pertaining to the variable portions
of their contracts and exclude any purchase payments for fixed dollar
benefits, the latter being included in the accounts of the Company.
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<PAGE> 12
A contract owner may choose from among a number of different underlying
mutual fund options. The underlying mutual fund options are not
available to the general public directly. The underlying mutual funds
are available as investment options in variable life insurance policies
or variable annuity contracts issued by life insurance companies or, in
some cases, through participation in certain qualified pension or
retirement plans.
Some of the underlying mutual funds have been established by investment
advisers which manage publicly traded mutual funds having similar names
and investment objectives. While some of the underlying mutual funds
may be similar to, and may in fact be modeled after, publicly traded
mutual funds, the underlying mutual funds are not otherwise directly
related to any publicly traded mutual fund. Consequently, the
investment performance of publicly traded mutual funds and any
corresponding underlying mutual funds may differ substantially.
(c) Security Valuation, Transactions and Related Investment Income
The market value of the underlying mutual funds is based on the closing
net asset value per share at June 30, 2000. The cost of investments
sold is determined on the specific identification basis. Investment
transactions are accounted for on the trade date (date the order to buy
or sell is executed) and dividend income is recorded on the ex-dividend
date.
(d) Federal Income Taxes
Operations of the Account form a part of, and are taxed with,
operations of the Company which is taxed as a life insurance company
under the Internal Revenue Code.
The Company does not provide for income taxes within the Account. Taxes
are the responsibility of the contract owner upon termination or
withdrawal.
(e) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles may require management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities, if
any, at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
(f) Calculation of Annuity Reserves
Annuity reserves are computed for contracts in the variable payout
stage according to industry standard mortality tables. The assumed
investment return is 3.5 percent unless the annuitant elects otherwise,
in which case the rate may vary from 3.5 percent to 7 percent, as
regulated by the laws of the respective states. The mortality risk is
fully borne by the Company and may result in additional amounts being
transferred into the Account by the Company to cover greater longevity
of annuitants than expected. Conversely, if reserves exceed amounts
required, transfers may be made to the Company.
(2) EXPENSES
The Company does not deduct a sales charge from purchase payments received
from the contract owners. However, if any part of the contract value of
such contracts is surrendered, the Company will, with certain exceptions,
deduct from a contract owners' contract value a contingent deferred sales
charge not to exceed 7% of the lesser of purchase payments or the amount
surrendered, such charge declining 1% per year, to 0%, after the purchase
payment has been held in the contract for 84 months. No sales charges are
deducted on redemptions used to purchase units in the fixed investment
options of the Company.
The following contract charges are deducted by the Company: (a) for the VA
contracts an annual contract maintenance charge of up to $30, dependent
upon contract type and issue date, which is satisfied by surrendering
units; for the VA II Convertible contracts a one-time contract maintenance
charge of up to $50, dependent upon the initial purchase payment and
contract type; and (b) for the VA contracts a mortality risk charge, an
expense risk charge and an administration charge assessed through the daily
unit value calculation equal to an annual rate of 0.80%, 0.45% and 0.05%,
respectively; for the VA II Convertible contracts a mortality risk charge,
an expense risk charge and an administration charge assessed through the
daily unit value calculation equal to an annual rate of 0.80%, 0.45% and
0.15%, respectively.
(Continued)
13
<PAGE> 13
NATIONWIDE VA SEPARATE ACCOUNT-A
NOTES TO FINANCIAL STATEMENTS, CONTINUED
(3) RELATED PARTY TRANSACTIONS
The Company performs various services on behalf of the Mutual Fund
Companies in which the Account invests and may receive fees for the
services performed. These services include, among other things, shareholder
communications, preparation, postage, fund transfer agency and various
other record keeping and customer service functions. These fees are paid to
an affiliate of the Company.
14
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15
<PAGE> 15
<TABLE>
<S> <C>
Bulk Rate
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY U.S. Postage
HOME OFFICE: ONE NATIONWIDE PLAZA - COLUMBUS, OHIO 43215-2220 PAID
Columbus, Ohio
Permit No. 521
Nationwide(R) is a registered federal service mark of Nationwide Mutual Insurance Company
</TABLE>
