<PAGE> 1
S E M I - A N N U A L R E P O R T
J U N E 3 0 , 1 9 9 6
WRL Series Annuity Account
Western Reserve Life Assurance Co. of Ohio
August 1996
ACC00002-S (8/96)
<PAGE> 2
- --------------------------------------------------------------------------------
T A B L E O F C O N T E N T S
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
Financial Statements:
Money Market Sub-Account..................... 2
Bond Sub-Account............................. 4
Growth Sub-Account........................... 6
Short-to-Intermediate Government
Sub-Account............................... 8
Global Sub-Account........................... 10
Equity-Income Sub-Account.................... 12
Emerging Growth Sub-Account.................. 14
Aggressive Growth Sub-Account................ 16
Balanced Sub-Account......................... 18
Utility Sub-Account.......................... 20
Tactical Asset Allocation Sub-Account........ 22
C.A.S.E. Growth Sub-Account.................. 24
Meridian/INVESCO Global Sector Sub-Account... 26
Value Equity Sub-Account..................... 28
Notes to Financial Statements..................... 30
BELLWETHER AND CONQUEROR
Financial Statements:
Money Market Sub-Account..................... 32
Bond Sub-Account............................. 34
Growth Sub-Account........................... 36
Short-to-Intermediate Government
Sub-Account............................... 38
Global Sub-Account........................... 40
Equity-Income Sub-Account.................... 42
Emerging Growth Sub-Account.................. 44
Aggressive Growth Sub-Account................ 46
Balanced Sub-Account......................... 48
Utility Sub-Account.......................... 50
Tactical Asset Allocation Sub-Account........ 52
C.A.S.E. Growth Sub-Account.................. 54
Meridian/INVESCO Global Sector Sub-Account... 56
Value Equity Sub-Account..................... 58
Notes to Financial Statements..................... 60
</TABLE>
1
<PAGE> 3
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
MONEY MARKET SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Money Market Portfolio
(41,848,374.710 shares;
cost $ 41,848,375)........................ $ 41,848,375
Accrued transfers from (to) depositor-net..... (127,977 )
-------------
Total assets.............................. 41,720,398
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 41,720,398
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Money Market sub-account
(3,199,078.678355 units;
$ 13.041379 unit value)................... $ 41,720,398
-------------
Total equity.............................. $ 41,720,398
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 1,056,045
Capital gain distributions.............. 0
----------------
1,056,045
EXPENSES:
Mortality and expense risk charges...... 261,682
----------------
Net investment income (loss).......... 794,363
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 0
Change in unrealized appreciation
(depreciation)........................ 0
----------------
Net gain (loss) on investments........ 0
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 794,363
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 794,363 $ 1,688,168
Net gain (loss) on investments.................................................... 0 0
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 794,363 1,688,168
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 5,050,740 (5,902,965)
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 13,983 29,037
Policy loans.................................................................... 17,013 519
Surrender benefits.............................................................. 5,652,095 8,795,944
Death benefits.................................................................. 37,131 682,261
---------------- -----------------
5,720,222 9,507,761
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... (669,482) (15,410,726)
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 124,881 (13,722,558)
EQUITY ACCOUNTS:
Beginning of period............................................................... 41,595,517 55,318,075
---------------- -----------------
End of period..................................................................... $ 41,720,398 $ 41,595,517
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
2
<PAGE> 4
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
MONEY MARKET SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------------------------------------
1996 1995 1994 1993 1992
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 12.80 $ 12.29 $ 12.03 $ 11.89 $ 11.68
Income from operations:
Net investment income (loss)................ .24 .51 .26 .14 .21
Net realized and unrealized
gain (loss) on investments................ .00 .00 .00 .00 .00
-------- -------- -------- -------- --------
Total income (loss) from operations....... .24 .51 .26 .14 .21
-------- -------- -------- -------- --------
Accumulation unit value, end of period.......... $ 13.04 $ 12.80 $ 12.29 $ 12.03 $ 11.89
========= ========= ========= ========= =========
Total return.................................... 1.89% 4.12% 2.22% 1.16% 1.77%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 41,720 $ 41,596 $ 55,318 $ 32,943 $ 41,133
Ratio of net investment income (loss)
to average net assets**..................... 3.71% 4.03% 2.28% 1.15% 1.73%
<CAPTION>
1991
--------
<S> <C>
Accumulation unit value, beginning of period.... $ 11.24
Income from operations:
Net investment income (loss)................ .44
Net realized and unrealized
gain (loss) on investments................ .00
--------
Total income (loss) from operations....... .44
--------
Accumulation unit value, end of period.......... $ 11.68
=========
Total return.................................... 3.97%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 29,003
Ratio of net investment income (loss)
to average net assets**..................... 3.80%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
3
<PAGE> 5
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
BOND SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Bond Portfolio
(4,521,640.523 shares;
cost $ 50,872,145)........................ $ 47,807,202
Accrued transfers from (to) depositor - net... (55,312)
--------------
Total assets.............................. 47,751,890
--------------
LIABILITIES:.................................... 0
--------------
Total net assets.......................... $ 47,751,890
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Bond sub-account
(2,738,159.088956 units;
$ 17.439414 unit value)................... $ 47,751,890
--------------
Total equity.............................. $ 47,751,890
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income....................... $ 1,303,954
Capital gain distributions............ 0
------------------
1,303,954
EXPENSES:
Mortality and expense risk charges.... 313,624
------------------
Net investment income (loss)........ 990,330
------------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from
securities transactions............. (579,498)
Change in unrealized appreciation
(depreciation)...................... (2,995,865)
------------------
Net gain (loss) on investments...... (3,575,363)
------------------
Net increase (decrease) in equity
accounts resulting from
operations...................... $ (2,585,033)
====================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 990,330 $ 2,463,557
Net gain (loss) on investments.................................................... (3,575,363) 7,173,790
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... (2,585,033) 9,637,347
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... (725,184) 2,542,773
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 20,369 44,441
Policy loans.................................................................... 9,368 22,037
Surrender benefits.............................................................. 2,645,389 4,815,578
Death benefits.................................................................. 371,932 381,877
---------------- -----------------
3,047,058 5,263,933
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... (3,772,242) (2,721,160)
---------------- -----------------
Net increase (decrease) in equity accounts...................................... (6,357,275) 6,916,187
EQUITY ACCOUNTS:
Beginning of period............................................................... 54,109,165 47,192,978
---------------- -----------------
End of period..................................................................... $ 47,751,890 $ 54,109,165
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
4
<PAGE> 6
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
BOND SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ----------------------------------------------------------------------
1996 1995 1994 1993 1992 1991
--------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of
period............................... $ 18.31 $ 15.08 $ 16.40 $ 14.65 $ 13.89 $ 11.83
Income from operations:
Net investment income (loss)....... .34 .83 .72 1.67 1.16 1.04
Net realized and unrealized
gain (loss) on investments....... (1.21 ) 2.40 (2.04) .08 (.40) 1.02
--------- -------- -------- -------- -------- --------
Total income (loss) from
operations..................... (.87 ) 3.23 (1.32) 1.75 .76 2.06
--------- -------- -------- -------- -------- --------
Accumulation unit value, end of
period............................... $ 17.44 $ 18.31 $ 15.08 $ 16.40 $ 14.65 $ 13.89
========= ========= ========= ========= ========= =========
Total return........................... (4.76 )% 21.46% (8.10)% 11.97% 5.44% 17.44%
Ratios and supplemental data:
Net assets at end of period (in
thousands)......................... $ 47,752 $ 54,109 $ 47,193 $ 66,483 $ 52,234 $ 19,312
Ratio of net investment income (loss)
to average net assets**............ 3.86 % 4.94% 4.69% 10.94% 8.18% 8.31%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
5
<PAGE> 7
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Growth Portfolio
(16,282,805.107 shares;
cost $ 427,871,479)....................... $ 593,115,472
Accrued transfers from (to) depositor - net... 370,809
-------------
Total assets.............................. 593,486,281
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 593,486,281
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Growth sub-account
(18,198,535.765976 units;
$ 32.611760 unit value)................... $ 593,486,281
-------------
Total equity.............................. $ 593,486,281
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 1,033,324
Capital gain distributions.............. 0
----------------
1,033,324
EXPENSES:
Mortality and expense risk charges...... 3,447,038
----------------
Net investment income (loss).......... (2,413,714)
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 7,129,488
Change in unrealized appreciation
(depreciation)........................ 71,065,258
----------------
Net gain (loss) on investments........ 78,194,746
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 75,781,032
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ (2,413,714) $ 45,360,822
Net gain (loss) on investments.................................................... 78,194,746 124,914,006
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 75,781,032 170,274,828
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 10,907,316 (5,005,493)
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 274,580 506,610
Policy loans.................................................................... 101,044 248,376
Surrender benefits.............................................................. 24,097,919 39,094,973
Death benefits.................................................................. 1,374,562 2,653,999
---------------- -----------------
25,848,105 42,503,958
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... (14,940,789) (47,509,451)
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 60,840,243 122,765,377
EQUITY ACCOUNTS:
Beginning of period............................................................... 532,646,038 409,880,661
---------------- -----------------
End of period..................................................................... $ 593,486,281 $ 532,646,038
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
6
<PAGE> 8
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
---------- ------------------------------------------------------------------
1996 1995 1994 1993 1992 1991
---------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of
period................................. $ 28.47 $ 19.60 $ 21.64 $ 21.07 $ 20.85 $ 13.21
Income from operations:
Net investment income (loss)......... (.13) 2.35 (.06) .20 .80 1.61
Net realized and unrealized
gain (loss) on investments......... 4.27 6.52 (1.98) .37 (.58) 6.03
--------- --------- --------- --------- --------- ---------
Total income (loss) from
operations....................... 4.14 8.87 (2.04) .57 .22 7.64
--------- --------- --------- --------- --------- ---------
Accumulation unit value, end of period... $ 32.61 $ 28.47 $ 19.60 $ 21.64 $ 21.07 $ 20.85
========= ========= ========= ========= ========= =========
Total return............................. 14.55% 45.29% (9.45)% 2.69% 1.07% 57.82%
Ratios and supplemental data:
Net assets at end of period (in
thousands)........................... $ 593,486 $ 532,646 $ 409,881 $ 575,024 $ 555,268 $ 284,934
Ratio of net investment income (loss)
to average net assets**.............. (.86)% 9.81% (.28)% .99% 4.07% 9.65%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
7
<PAGE> 9
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
SHORT-TO-INTERMEDIATE GOVERNMENT SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Short-to-Intermediate Government Portfolio
(817,485.506 shares;
cost $ 8,411,597)......................... $ 8,367,243
Accrued transfers from (to) depositor - net... 94
-------------
Total assets.............................. 8,367,337
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 8,367,337
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Short-to-Intermediate Government
sub-account
(737,543.914518 units;
$ 11.344866 unit value)................... $ 8,367,337
-------------
Total equity.............................. $ 8,367,337
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 134,822
Capital gain distributions.............. 0
----------------
134,822
EXPENSES:
Mortality and expense risk charges...... 54,208
----------------
Net investment income (loss).......... 80,614
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 128,657
Change in unrealized appreciation
(depreciation)........................ (277,088)
----------------
Net gain (loss) on investments........ (148,431)
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ (67,817)
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 80,614 $ 384,381
Net gain (loss) on investments.................................................... (148,431) 571,227
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... (67,817) 955,608
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... (377,099) 1,015,750
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 2,550 5,833
Policy loans.................................................................... 0 0
Surrender benefits.............................................................. 375,832 369,692
Death benefits.................................................................. 22,203 218,964
---------------- -----------------
400,585 594,489
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... (777,684) 421,261
---------------- -----------------
Net increase (decrease) in equity accounts...................................... (845,500) 1,376,869
EQUITY ACCOUNTS:
Beginning of period............................................................... 9,212,837 7,835,968
---------------- -----------------
End of period..................................................................... $ 8,367,337 $ 9,212,837
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
8
<PAGE> 10
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
SHORT-TO-INTERMEDIATE GOVERNMENT SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- --------------------------------------------------
1996 1995 1994 1993 1992+
--------- ------- ------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.43 $ 10.19 $ 10.36 $ 10.04 $ 10.00
Income from operations:
Net investment income (loss)................ .10 .49 .37 .21 .01
Net realized and unrealized
gain (loss) on investments................ (.19) .75 (.54) .11 .03
------ ------- ------- -------- --------
Total income (loss) from operations....... (.09) 1.24 (.17) .32 .04
------ ------- ------- -------- --------
Accumulation unit value, end of period.......... $ 11.34 $ 11.43 $ 10.19 $ 10.36 $ 10.04
====== ======= ======= ======== ========
Total return.................................... (.73)% 12.13% (1.66)% 3.28% .36%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 8,367 $ 9,213 $ 7,836 $ 10,010 $ 853
Ratio of net investment income (loss)
to average net assets**..................... 1.82% 4.59% 3.67% 2.08% .14%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total
return is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
9
<PAGE> 11
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
GLOBAL SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Global Portfolio
(10,918,808.931 shares;
cost $ 155,685,432)....................... $ 203,580,680
Accrued transfers from (to) depositor - net... 310,001
--------------
Total assets.............................. 203,890,681
--------------
LIABILITIES:.................................... 0
--------------
Total net assets.......................... $ 203,890,681
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Global sub-account
(10,471,358.575209 units;
$ 19.471273 unit value)................... $ 203,890,681
--------------
Total equity.............................. $ 203,890,681
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 183,193
Capital gain distributions.............. 0
------------
183,193
EXPENSES:
Mortality and expense risk charges...... 1,071,618
------------
Net investment income (loss).......... (888,425)
------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 844,667
Change in unrealized appreciation
(depreciation)........................ 30,764,760
------------
Net gain (loss) on investments........ 31,609,427
------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 30,721,002
============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (888,425) $ 3,845,538
Net gain (loss) on investments................................................... 31,609,427 21,401,529
------------- -------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 30,721,002 25,247,067
------------- -------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 37,991,278 (18,151,534)
------------- -------------
Less cost of units redeemed:
Administrative charges......................................................... 69,762 125,566
Policy loans................................................................... 19,458 93,720
Surrender benefits............................................................. 5,889,286 9,634,079
Death benefits................................................................. 268,150 522,441
------------- -------------
6,246,656 10,375,806
------------- -------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 31,744,622 (28,527,340)
------------- -------------
Net increase (decrease) in equity accounts..................................... 62,465,624 (3,280,273)
EQUITY ACCOUNTS:
Beginning of period.............................................................. 141,425,057 144,705,330
------------- -------------
End of period.................................................................... $ 203,890,681 $ 141,425,057
============= =============
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
10
<PAGE> 12
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
GLOBAL SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ------------------------------------------------------
1996 1995 1994 1993 1992+
--------- --------- --------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 16.29 $ 13.40 $ 13.54 $ 10.15 $ 10.00
Income from operations:
Net investment income (loss)................ (.09) .42 .45 .16 (.01)
Net realized and unrealized
gain (loss) on investments................ 3.27 2.47 (.59) 3.23 .16
--------- --------- --------- -------- -------
Total income (loss) from operations....... 3.18 2.89 (.14) 3.39 .15
--------- --------- --------- -------- -------
Accumulation unit value, end of period.......... $ 19.47 $ 16.29 $ 13.40 $ 13.54 $ 10.15
========== ========== ========== ========= ========
Total return.................................... 19.54% 21.53% (0.99)% 33.34% 1.52%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 203,891 $ 141,425 $ 144,705 $ 69,665 $ 254
Ratio of net investment income (loss)
to average net assets**..................... (1.01)% 2.89% 3.40% 1.40% (.10)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total
return is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
11
<PAGE> 13
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
EQUITY-INCOME SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Equity-Income Portfolio
(9,405,068.326 shares;
cost $ 108,444,478)....................... $ 128,495,868
Accrued transfers from (to) depositor - net... 54,110
-------------
Total assets.............................. 128,549,978
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 128,549,978
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Equity-Income sub-account
(8,889,159.649939 units;
$ 14.461432 unit value)................... $ 128,549,978
-------------
Total equity.............................. $ 128,549,978
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 849,992
Capital gain distributions.............. 0
----------------
849,992
EXPENSES:
Mortality and expense risk charges...... 763,430
----------------
Net investment income (loss).......... 86,562
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 1,134,716
Change in unrealized appreciation
(depreciation)........................ 6,174,394
----------------
Net gain (loss) on investments........ 7,309,110
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 7,395,672
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 86,562 $ 4,829,923
Net gain (loss) on investments.................................................... 7,309,110 16,256,046
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 7,395,672 21,085,969
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 9,025,301 13,068,987
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 42,292 78,077
Policy loans.................................................................... 29,556 76,572
Surrender benefits.............................................................. 3,963,146 5,988,610
Death benefits.................................................................. 210,391 244,625
---------------- -----------------
4,245,385 6,387,884
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 4,779,916 6,681,103
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 12,175,588 27,767,072
EQUITY ACCOUNTS:
Beginning of period............................................................... 116,374,390 88,607,318
---------------- -----------------
End of period..................................................................... $ 128,549,978 $ 116,374,390
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
12
<PAGE> 14
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
EQUITY-INCOME SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
---------- ---------------------------------------
1996 1995 1994 1993+
---------- --------- -------- --------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 13.61 $ 11.06 $ 11.25 $ 10.00
Income from operations:
Net investment income (loss)................ .01 .59 .16 .16
Net realized and unrealized
gain (loss) on investments................ .84 1.96 (.35) 1.09
--------- --------- --------- ---------
Total income (loss) from operations....... .85 2.55 (.19) 1.25
--------- --------- --------- ---------
Accumulation unit value, end of period.......... $ 14.46 $ 13.61 $ 11.06 $ 11.25
========= ========= ========= =========
Total return.................................... 6.26% 23.11% (1.77)% 12.54%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 128,550 $ 116,374 $ 88,607 $ 49,240
Ratio of net investment income (loss)
to average net assets**..................... .14% 4.74% 1.43% 1.53%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
13
<PAGE> 15
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
EMERGING GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Emerging Growth Portfolio
(7,563,526.825 shares;
cost $ 100,007,807)....................... $ 145,093,903
Accrued transfers from (to) depositor - net... 393,805
-------------
Total assets.............................. 145,487,708
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 145,487,708
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Emerging Growth sub-account
(7,557,242.792956 units;
$ 19.251427 unit value)................... $ 145,487,708
-------------
Total equity.............................. $ 145,487,708
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 0
Capital gain distributions.............. 0
----------------
0
EXPENSES:
Mortality and expense risk charges...... 780,743
----------------
Net investment income (loss).......... (780,743)
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 1,575,659
Change in unrealized appreciation
(depreciation)........................ 19,350,096
----------------
Net gain (loss) on investments........ 20,925,755
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 20,145,012
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ (780,743) $ 3,589,652
Net gain (loss) on investments.................................................... 20,925,755 32,014,723
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 20,145,012 35,604,375
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 14,125,206 4,113,982
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 51,096 87,206
Policy loans.................................................................... 44,336 68,066
Surrender benefits.............................................................. 4,366,771 6,989,309
Death benefits.................................................................. 117,615 256,599
---------------- -----------------
4,579,818 7,401,180
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 9,545,388 (3,287,198)
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 29,690,400 32,317,177
EQUITY ACCOUNTS:
Beginning of period............................................................... 115,797,308 83,480,131
---------------- -----------------
End of period..................................................................... $ 145,487,708 $ 115,797,308
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
14
<PAGE> 16
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
EMERGING GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ---------------------------------------
1996 1995 1994 1993+
--------- --------- -------- --------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 16.40 $ 11.31 $ 12.37 $ 10.00
Income from operations:
Net investment income (loss)................ (.11) .51 (.13) (.12)
Net realized and unrealized
gain (loss) on investments................ 2.96 4.58 (.93) 2.49
--------- --------- -------- --------
Total income (loss) from operations....... 2.85 5.09 (1.06) 2.37
--------- --------- -------- --------
Accumulation unit value, end of period.......... $ 19.25 $ 16.40 $ 11.31 $ 12.37
========== ========== ========= =========
Total return.................................... 17.37% 44.97% (8.51)% 23.67%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 145,488 $ 115,797 $ 83,480 $ 58,794
Ratio of net investment income (loss)
to average net assets**..................... (1.22)% 3.68% (1.21)% (1.08)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
15
<PAGE> 17
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
AGGRESSIVE GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Aggressive Growth Portfolio
(4,556,462.138 shares;
cost $ 61,087,702)....................... $ 63,839,804
Accrued transfers from (to)
depositor - net............................ 121,640
---------------
Total assets............................. 63,961,444
---------------
LIABILITIES:................................... 0
---------------
Total net assets......................... $ 63,961,444
===============
EQUITY ACCOUNTS:
Contract Owners' equity:
Aggressive Growth sub-account
(4,560,162.085673 units;
$ 14.026134 unit value).................. $ 63,961,444
---------------
Total equity............................. $ 63,961,444
===============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 0
Capital gain distributions.............. 0
----------------
0
EXPENSES:
Mortality and expense risk charges...... 401,367
----------------
Net investment income (loss).......... (401,367)
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 3,716,833
Change in unrealized appreciation
(depreciation)........................ (307,362)
----------------
Net gain (loss) on investments........ 3,409,471
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 3,008,104
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ (401,367) $ 1,120,016
Net gain (loss) on investments.................................................... 3,409,471 10,026,368
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 3,008,104 11,146,384
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... (1,825,362) 39,257,963
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 23,512 33,386
Policy loans.................................................................... 17,440 6,188
Surrender benefits.............................................................. 2,808,448 2,866,706
Death benefits.................................................................. 38,242 113,112
---------------- -----------------
2,887,642 3,019,392
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... (4,713,004) 36,238,571
---------------- -----------------
Net increase (decrease) in equity accounts...................................... (1,704,900) 47,384,955
Depositors' equity contribution (redemption)...................................... 0 (273,355)
EQUITY ACCOUNTS:
Beginning of period............................................................... 65,666,344 18,554,744
---------------- -----------------
End of period..................................................................... $ 63,961,444 $ 65,666,344
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
16
<PAGE> 18
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
AGGRESSIVE GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------
1996 1995 1994+
-------- -------- --------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 13.35 $ 9.79 $ 10.00
Income from operations:
Net investment income (loss)................ (.08) .29 (.08)
Net realized and unrealized
gain (loss) on investments................ .76 3.27 (.13)
-------- -------- --------
Total income (loss) from operations....... .68 3.56 (.21)
-------- -------- --------
Accumulation unit value, end of period.......... $ 14.03 $ 13.35 $ 9.79
========= ========= =========
Total return.................................... 5.09% 36.31% (2.08)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 63,961 $ 65,666 $ 18,555
Ratio of net investment income (loss)
to average net assets**..................... (1.22)% 2.28% (.87)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1994. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
17
<PAGE> 19
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
BALANCED SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Balanced Portfolio
(1,141,331.332 shares;
cost $ 11,398,896)........................ $ 12,464,761
Accrued transfers from (to) depositor-net..... (50,640 )
-------------
Total assets.............................. 12,414,121
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 12,414,121
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Balanced sub-account
(1,092,703.354120 units;
$ 11.360925 unit value)................... $ 12,414,121
-------------
Total equity.............................. $ 12,414,121
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 78,800
Capital gain distributions.............. 0
----------------
78,800
EXPENSES:
Mortality and expense risk charges...... 74,778
----------------
Net investment income (loss).......... 4,022
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 154,135
Change in unrealized appreciation
(depreciation)........................ 162,079
----------------
Net gain (loss) on investments........ 316,214
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 320,236
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 4,022 $ 272,734
Net gain (loss) on investments.................................................... 316,214 1,354,330
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 320,236 1,627,064
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 1,410,970 1,328,562
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 4,105 7,018
Policy loans.................................................................... 2,050 2,452
Surrender benefits.............................................................. 417,811 967,365
Death benefits.................................................................. 17,108 15,181
---------------- -----------------
441,074 992,016
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 969,896 336,546
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 1,290,132 1,963,610
Depositors' equity contribution (redemption)...................................... (218,651) 0
EQUITY ACCOUNTS:
Beginning of period............................................................... 11,342,640 9,379,030
---------------- -----------------
End of period..................................................................... $ 12,414,121 $ 11,342,640
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
18
<PAGE> 20
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
BALANCED SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -------------------------
1996 1995 1994+
-------- -------- -------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.06 $ 9.35 $ 10.00
Income from operations:
Net investment income (loss)................ .00 .29 .21
Net realized and unrealized
gain (loss) on investment................. .30 1.42 (.86)
-------- -------- -------
Total income (loss) from operations....... .30 1.71 (.65)
-------- -------- -------
Accumulation unit value, end of period.......... $ 11.36 $ 11.06 $ 9.35
======== ======== =======
Total return.................................... 2.72% 18.31% (6.52)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 12,414 $ 11,343 $ 9,379
Ratio of net investment income (loss)
to average net assets**..................... .07% 2.85% 2.19%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date for this sub-account was March 1, 1994. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
19
<PAGE> 21
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
UTILITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Utility Portfolio
(1,138,178.057 shares;
cost $ 12,051,008)........................ $ 13,140,425
Accrued transfers from (to) depositor - net... 22,419
-------------
Total assets.............................. 13,162,844
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 13,162,844
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Utility sub-account
(1,083,065.601380 units;
$ 12.153321 unit value)................... $ 13,162,844
-------------
Total equity.............................. $ 13,162,844
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 83,596
Capital gain distributions.............. 0
----------------
83,596
EXPENSES:
Mortality and expense risk charges...... 79,156
----------------
Net investment income (loss).......... 4,440
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 450,996
Change in unrealized appreciation
(depreciation)........................ (11,257)
----------------
Net gain (loss) on investments........ 439,739
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 444,179
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 4,440 $ 374,648
Net gain (loss) on investments.................................................... 439,739 1,474,907
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 444,179 1,849,555
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 1,688,731 5,047,279
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 3,312 5,178
Policy loans.................................................................... 524 3,519
Surrender benefits.............................................................. 624,186 491,819
Death benefits.................................................................. 1,323 12,014
---------------- -----------------
629,345 512,530
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 1,059,386 4,534,749
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 1,503,565 6,384,304
Depositors' equity contribution (redemption)...................................... (231,034) 0
EQUITY ACCOUNTS:
Beginning of period............................................................... 11,890,313 5,506,009
---------------- -----------------
End of period..................................................................... $ 13,162,844 $ 11,890,313
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
20
<PAGE> 22
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
UTILITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------------
1996 1995 1994+
-------- -------- -----------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.71 $ 9.46 $ 10.00
Income from operations:
Net investment income (loss)................ .01 .45 .32
Net realized and unrealized
gain (loss) on investment................. .43 1.80 (.86)
-------- -------- -----------
Total income (loss) from operations....... .44 2.25 (.54)
-------- -------- -----------
Accumulation unit value, end of period.......... $ 12.15 $ 11.71 $ 9.46
========= ========= =============
Total return.................................... 3.83% 23.70% (5.37)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 13,163 $ 11,890 $ 5,506
Ratio of net investment income (loss)
to average net assets**..................... .07% 4.26% 3.39%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date for this sub-account was March 1, 1994. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
21
<PAGE> 23
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
TACTICAL ASSET ALLOCATION SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Tactical Asset Allocation Portfolio
(4,201,332.828 shares;
cost $ 46,856,979)........................ $ 50,333,380
Accrued transfers from (to) depositor - net... (7,063 )
-------------
Total assets.............................. 50,326,317
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 50,326,317
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Tactical Asset Allocation sub-account
(4,073,197.039181 units;
$ 12.355483 unit value)................... $ 50,326,317
-------------
Total equity.............................. $ 50,326,317
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 270,771
Capital gain distributions.............. 0
----------------
270,771
EXPENSES:
Mortality and expense risk charges...... 278,811
----------------
Net investment income (loss).......... (8,040)
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 573,950
Change in unrealized appreciation
(depreciation)........................ 1,141,032
----------------
Net gain (loss) on investments........ 1,714,982
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 1,706,942
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERIOD ENDED
JUNE 30, 1996 DECEMBER 31, 1995*
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (8,040) $ 1,087,280
Net gain (loss) on investments................................................... 1,714,982 2,594,191
---------------- ------------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 1,706,942 3,681,471
---------------- ------------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 15,294,485 32,279,325
---------------- ------------------
Less cost of units redeemed:
Administrative charges......................................................... 11,619 10,562
Policy loans................................................................... 0 34,893
Surrender benefits............................................................. 1,546,736 983,608
Death benefits................................................................. 26,699 14,621
---------------- ------------------
1,585,054 1,043,684
---------------- ------------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 13,709,431 31,235,641
---------------- ------------------
Net increase (decrease) in equity accounts..................................... 15,416,373 34,917,112
Depositors' equity contribution (redemption)..................................... 0 (7,168)
EQUITY ACCOUNTS:
Beginning of period.............................................................. 34,909,944 0
---------------- ------------------
End of period.................................................................... $ 50,326,317 $ 34,909,944
================== ====================
</TABLE>
* The inception date of this sub-account was January 3, 1995.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
22
<PAGE> 24
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
TACTICAL ASSET ALLOCATION SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- -----------
1996 1995+
--------- -----------
<S> <C> <C>
Accumulation unit value, beginning of period..... $ 11.86 $ 10.00
Income from operations:
Net investment income (loss)................. (.01 ) .58
Net realized and unrealized
gain (loss) on investments................. .50 1.28
--------- -----------
Total income (loss) from operations........ .49 1.86
--------- -----------
Accumulation unit value, end of period........... $ 12.35 $ 11.86
========= =============
Total return..................................... 4.17 % 18.61%
Ratios and supplemental data:
Net assets at end of period (in thousands)..... $ 50,326 $ 34,910
Ratio of net investment income (loss)
to average net assets**...................... (.04 )% 5.25%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception of this sub-account was January 3, 1995. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
23
<PAGE> 25
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
C.A.S.E. GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
C.A.S.E. Growth Portfolio
(69,790.862 shares;
cost $ 878,985)........................... $ 868,667
Accrued transfers from (to) depositor - net... 16,004
-------------
Total assets.............................. 884,671
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 884,671
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
C.A.S.E. Growth sub-account
(69,683.672519 units;
$ 12.695527 unit value)................... $ 884,671
-------------
Total equity.............................. $ 884,671
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income............................ $ 0
Capital gain distributions................. 0
--------------
0
EXPENSES:
Mortality and expense risk charges......... 1,041
--------------
Net investment income (loss)............. (1,041)
--------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................. 2,117
Change in unrealized appreciation
(depreciation)........................... (10,318)
--------------
Net gain (loss) on investments........... (8,201)
--------------
Net increase (decrease) in equity
accounts resulting from operations... $ (9,242)
===============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)............................................................................... $ (1,041)
Net gain (loss) on investments............................................................................. (8,201)
--------------
Net increase (decrease) in equity accounts
resulting from operations................................................................................ (9,242)
--------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)........................................................................ 894,329
--------------
Less cost of units redeemed:
Administrative charges................................................................................... 30
Policy loans............................................................................................. 0
Surrender benefits....................................................................................... 386
Death benefits........................................................................................... 0
--------------
416
--------------
Increase (decrease) in equity accounts from
capital unit transactions.............................................................................. 893,913
--------------
Net increase (decrease) in equity accounts............................................................... 884,671
Depositors' equity contribution (redemption)............................................................... 0
EQUITY ACCOUNTS:
Beginning of period........................................................................................ 0
--------------
End of period.............................................................................................. $ 884,671
===============
</TABLE>
* This sub-account option became effective May 1, 1996
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
24
<PAGE> 26
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
C.A.S.E. GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
---------
1996+
---------
<S> <C>
Accumulation unit value, beginning of period..... $ 12.87
Income from operations:
Net investment income (loss)................. (.02)
Net realized and unrealized
gain (loss) on investments................. (.15)
---------
Total income (loss) from operations........ (.17)
---------
Accumulation unit value, end of period........... $ 12.70
=========
Total return..................................... (1.38)%
Ratios and supplemental data:
Net assets at end of period (in thousands)..... $ 885
Ratio of net investment income (loss)
to average net assets**...................... (1.16)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ This sub-account option became effective May 1, 1996. The total return is not
annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
25
<PAGE> 27
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
MERIDIAN/INVESCO GLOBAL SECTOR SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Meridian/INVESCO Global Sector Portfolio
(96,355.992 shares;
cost $ 966,980)........................... $ 962,004
Accrued transfers from (to) depositor - net... (6,759)
-------------
Total assets.............................. 955,245
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 955,245
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Meridian/INVESCO Global Sector
sub-account
(45,874.773089 units;
$ 9.963711 unit value).................... $ 457,083
Depositors' equity:
Meridian/INVESCO Global Sector
sub-account
(49,997.602730 units;
$ 9.963711 unit value).................... 498,162
-------------
Total equity.............................. $ 955,245
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income............................ $ 0
Capital gain distributions................. 0
--------------
0
EXPENSES:
Mortality and expense risk charges......... 1,312
--------------
Net investment income (loss)............. (1,312)
--------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................. 7
Change in unrealized appreciation
(depreciation)........................... (4,977)
--------------
Net gain (loss) on investments........... (4,970)
--------------
Net increase (decrease) in equity
accounts resulting from operations... $ (6,282)
===============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)................................................................................... $ (1,312)
Net gain (loss) on investments................................................................................. (4,970)
--------------
Net increase (decrease) in equity accounts
resulting from operations.................................................................................... (6,282)
--------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................................................ 461,532
--------------
Less cost of units redeemed:
Administrative charges....................................................................................... 5
Policy loans................................................................................................. 0
Surrender benefits........................................................................................... 0
Death benefits............................................................................................... 0
--------------
5
--------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................................................. 461,527
--------------
Net increase (decrease) in equity accounts................................................................... 455,245
Depositors' equity contribution (redemption)................................................................... 500,000
EQUITY ACCOUNTS:
Beginning of period............................................................................................ 0
--------------
End of period.................................................................................................. $ 955,245
===============
</TABLE>
* The inception date of this sub-account was May 1, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
26
<PAGE> 28
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
MERIDIAN/INVESCO GLOBAL SECTOR SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
---------
1996+
---------
<S> <C>
Accumulation unit value, beginning of period..... $ 10.00
Income from operations:
Net investment income (loss)................. (.02)
Net realized and unrealized
gain (loss) on investments................. (.02)
---------
Total income (loss) from operations........ (.04)
---------
Accumulation unit value, end of period........... $ 9.96
=========
Total return..................................... (.36)%
Ratios and supplemental data:
Net assets at end of period (in thousands)..... $ 955
Ratio of net investment income (loss)
to average net assets**...................... (1.17)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was May 1, 1996. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
27
<PAGE> 29
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
VALUE EQUITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Value Equity Portfolio
(142,437.290 shares;
cost $ 1,426,678)......................... $ 1,435,325
Accrued transfers from (to) depositor - net... 56,982
-------------
Total assets.............................. 1,492,307
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 1,492,307
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Value Equity sub-account
(133,391.502707 units;
$ 10.056554 unit value)................... $ 1,341,459
Depositors' equity
Value Equity sub-account
(15,000.000000 units;
$ 10.056554 unit value)................... 150,848
-------------
Total equity.............................. $ 1,492,307
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income............................ $ 0
Capital gain distributions................. 0
--------------
0
EXPENSES:
Mortality and expense risk charges......... 1,457
--------------
Net investment income (loss)............. (1,457)
--------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................. 2
Change in unrealized appreciation
(depreciation)........................... 8,647
--------------
Net gain (loss) on investments........... 8,649
--------------
Net increase (decrease) in equity
accounts resulting from operations... $ 7,192
===============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)............................................................................... $ (1,457)
Net gain (loss) on investments............................................................................. 8,649
--------------
Net increase (decrease) in equity accounts
resulting from operations................................................................................ 7,192
--------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)........................................................................ 1,335,218
--------------
Less cost of units redeemed:
Administrative charges................................................................................... 13
Policy loans............................................................................................. 0
Surrender benefits....................................................................................... 90
Death benefits........................................................................................... 0
--------------
103
--------------
Increase (decrease) in equity accounts from
capital unit transactions.............................................................................. 1,335,115
--------------
Net increase (decrease) in equity accounts............................................................... 1,342,307
Depositors' equity contribution (redemption)............................................................... 150,000
EQUITY ACCOUNTS:
Beginning of period........................................................................................ 0
--------------
End of period.............................................................................................. $ 1,492,307
===============
</TABLE>
* The inception date of this sub-account was May 1, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
28
<PAGE> 30
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
VALUE EQUITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
---------
1996+
---------
<S> <C>
Accumulation unit value, beginning of period..... $ 10.00
Income from operations:
Net investment income (loss)................. (.02)
Net realized and unrealized
gain (loss) on investments................. .08
---------
Total income (loss) from operations........ .06
---------
Accumulation unit value, end of period........... $ 10.06
=========
Total return..................................... .57%
Ratios and supplemental data:
Net assets at end of period (in thousands)..... $ 1,492
Ratio of net investment income (loss)
to average net assets**...................... (1.16)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was May 1, 1996. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
29
<PAGE> 31
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
- --------------------------------------------------------------------------------
JUNE 30, 1996
NOTE 1 - ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
The WRL Series Annuity Account (the "Annuity Account") was established as a
variable accumulation deferred annuity separate account of Western Reserve Life
Assurance Co. of Ohio ("WRL") and is registered as a unit investment trust
("Trust") under the Investment Company Act of 1940, as amended. The Annuity
Account encompasses various contract types: the WRL Freedom Variable Annuity and
the WRL Freedom Attainer ("Annuity #1"); the WRL Freedom Bellwether and the WRL
Freedom Conqueror ("Annuity #2"). Each contains fourteen investment options
referred to as sub-accounts. Each sub-account invests in the corresponding
portfolio of the WRL Series Fund, Inc. (the "Fund"), a registered management
investment company under the Investment Company Act of 1940, as amended. These
portfolios and their respective investment management organizations are as
follows:
<TABLE>
<CAPTION>
PORTFOLIO INVESTMENT MANAGER
- ---------------------- ------------------------------
<S> <C>
Money Market J.P. Morgan Investment
Management Inc.
Bond Janus Capital Corporation
("JCC")
Growth JCC
Short-to-Intermediate AEGON USA Investment
Government Management, Inc. ("AEGON
Management")
Global JCC
Equity-Income Luther King Capital Management
Corporation
Emerging Growth Van Kampen American Capital
Asset Management, Inc.
Aggressive Growth Fred Alger Management, Inc.
Balanced AEGON Management
Utility Federated Investment
Counseling
Tactical Asset Dean Investment Associates
Allocation
C.A.S.E. Growth C.A.S.E. Management, Inc.
Meridian/INVESCO Meridian Investment Management
Global Sector Corporation/ INVESCO Global
Asset Management Limited
Value Equity NWQ Investment Management
Company, Inc.
</TABLE>
WRL and AEGON Management are indirectly wholly-owned subsidiaries of AEGON
USA, Inc., which is an indirect wholly-owned subsidiary of AEGON nv, a
Netherlands corporation.
On May 1, 1996, WRL made an initial contribution to the Annuity Account.
The amount of the contribution and units received from the corresponding
sub-accounts are as follows:
<TABLE>
<CAPTION>
SUB-ACCOUNT CONTRIBUTION UNITS
- ----------------------- ------------ -------------
<S> <C> <C>
Meridian/INVESCO Global
Sector $500,000 49,997.602730
Value Equity 150,000 15,000.000000
</TABLE>
Annuity #1 sub-accounts hold assets to support the benefits under certain
flexible payment variable accumulation deferred annuity contracts (the
"Contracts") issued by WRL, which issued the first of such Contracts on February
24, 1989. The Annuity Account equity transactions are accounted for using the
appropriate effective date at the corresponding accumulation unit value.
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
The following significant accounting policies, which are in conformity with
generally accepted accounting principles for unit investment trusts, have been
consistently used in preparation of the Trust's financial statements.
A. VALUATION OF INVESTMENTS
The investments in the Fund's shares are stated at the closing net asset
value ("NAV") per share as determined by the Fund on June 30, 1996.
Investment transactions are accounted for on the trade date, using the Fund
NAV next determined after receipt of sale or redemption order without sales
charges. Dividend income and capital gain distributions are recorded on the
ex-dividend date. The cost of investments sold is determined on a first-in,
first-out basis.
- --------------------------------------------------------------------------------
30
<PAGE> 32
WRL SERIES ANNUITY ACCOUNT
FREEDOM AND ATTAINER
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
- --------------------------------------------------------------------------------
NOTE 1 (CONTINUED)
B. FEDERAL INCOME TAXES
The operations of the Annuity Account are a part of and are taxed with the
total operations of WRL, which is taxed as a life insurance company under
the Internal Revenue Code. Under current law, the investment income of the
Annuity Account, including realized and unrealized capital gains, is not
taxable to WRL. Accordingly, no provision for Federal income taxes has been
made.
NOTE 2 - CHARGES AND DEDUCTIONS
Charges are assessed by WRL in connection with issuance and administration
of the Contracts.
A. CONTRACT CHARGES
No deduction for sales expenses are made from the purchase payments. A
contingent deferred sales charge may, however, be assessed against contract
values when withdrawn or surrendered.
On each anniversary through maturity date, WRL will deduct an annual
contract charge as partial compensation for providing administrative
services under the Contracts.
B. ANNUITY #1 SUB-ACCOUNTS CHARGES
A daily charge equal to an annual rate of 1.25% of average daily net assets
is assessed to compensate WRL for assumption of mortality and expense risks
and administrative services in connection with issuance and administration
of the Contracts. This charge (not assessed at the individual contract
level) effectively reduces the value of a unit outstanding during the year.
NOTE 3 - DIVIDENDS AND DISTRIBUTIONS
Dividends of the Fund's Money Market Portfolio are declared daily and
reinvested monthly. Dividends of the remaining portfolios are declared and
reinvested semi-annually, while capital gain distributions are declared and
reinvested annually. Dividends and distributions of the Fund are generally paid
to and reinvested by the Annuity Account the next business day after
declaration.
NOTE 4 - OTHER MATTERS
As of June 30, 1996 the equity accounts include net unrealized appreciation
(depreciation) on investments as follows:
<TABLE>
<S> <C>
SUB-ACCOUNT
Money Market.......................... $ n/a
Bond.................................. (3,064,943)
Growth................................ 165,243,993
Short-to-Intermediate Government...... (44,354)
Global................................ 47,895,248
Equity-Income......................... 20,051,390
Emerging Growth....................... 45,086,096
Aggressive Growth..................... 2,752,102
Balanced.............................. 1,065,865
Utility............................... 1,089,417
Tactical Asset Allocation............. 3,476,401
C.A.S.E. Growth....................... (10,318)
Meridian/INVESCO Global Sector........ (4,976)
Value Equity.......................... 8,647
</TABLE>
- --------------------------------------------------------------------------------
31
<PAGE> 33
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
MONEY MARKET SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Money Market Portfolio
(44,170,169.210 shares;
cost $ 44,170,169)........................ $ 44,170,169
Accrued transfers from (to) depositor - net... (56,614 )
-------------
Total assets.............................. 44,113,555
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 44,113,555
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Money Market sub-account
(4,038,984.590128 units;
$ 10.921942 unit value)................... $ 44,113,555
-------------
Total equity.............................. $ 44,113,555
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 866,929
Capital gain distributions.............. 0
----------------
866,929
EXPENSES:
Mortality and expense risk charges...... 241,059
----------------
Net investment income (loss).......... 625,870
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 0
Change in unrealized appreciation
(depreciation)........................ 0
----------------
Net gain (loss) on investments........ 0
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 625,870
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ 625,870 $ 1,313,504
Net gain (loss) on investments................................................... 0 0
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 625,870 1,313,504
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 18,036,820 3,849,894
---------------- -----------------
Less cost of units redeemed:
Administrative charges......................................................... 7,910 15,085
Policy loans................................................................... 11,098 30,025
Surrender benefits............................................................. 2,689,407 4,807,455
Death benefits................................................................. 364,459 324,411
---------------- -----------------
3,072,874 5,176,976
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 14,963,946 (1,327,082)
---------------- -----------------
Net increase (decrease) in equity accounts..................................... 15,589,816 (13,578)
EQUITY ACCOUNTS:
Beginning of period.............................................................. 28,523,739 28,537,317
---------------- -----------------
End of period.................................................................... $ 44,113,555 $ 28,523,739
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
32
<PAGE> 34
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
MONEY MARKET SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- ----------------------------------------------------------
1996 1995 1994 1993 1992+
-------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 10.73 $ 10.32 $ 10.11 $ 10.01 $ 10.00
Income from operations:
Net investment income (loss)................ .19 .41 .21 .10 .01
Net realized and unrealized
gain (loss) on investment................. .00 .00 .00 .00 .00
-------- -------- -------- ------- -------
Total income (loss) from operations....... .19 .41 .21 .10 .01
-------- -------- -------- ------- -------
Accumulation unit value, end of period.......... $ 10.92 $ 10.73 $ 10.32 $ 10.11 $ 10.01
========= ========= ========= ======== ========
Total return.................................... 1.81% 3.96% 2.07% 1.01% .09%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 44,114 $ 28,524 $ 28,537 $ 8,786 $ 100
Ratio of net investment income (loss)
to average net assets**..................... 3.54% 3.89% 2.26% 1.03% .09%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total
return is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
33
<PAGE> 35
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
BOND SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Bond Portfolio
(3,113,693.086 shares;
cost $ 33,720,856)........................ $ 32,921,005
Accrued transfers from (to) depositor - net... 11,635
-------------
Total assets.............................. 32,932,640
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 32,932,640
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Bond sub-account
(2,743,597.911458 units;
$ 12.003450 unit value)................... $ 32,932,640
-------------
Total equity.............................. $ 32,932,640
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 898,885
Capital gain distributions.............. 0
----------------
898,885
EXPENSES:
Mortality and expense risk charges...... 228,959
----------------
Net investment income (loss).......... 669,926
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... (494,373)
Change in unrealized appreciation
(depreciation)........................ (1,847,531)
----------------
Net gain (loss) on investments........ (2,341,904)
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ (1,671,978)
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 669,926 $ 1,334,567
Net gain (loss) on investments.................................................... (2,341,904) 3,265,003
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... (1,671,978) 4,599,570
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 3,134,651 12,376,956
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 11,646 20,247
Policy loans.................................................................... 0 0
Surrender benefits.............................................................. 1,073,934 1,650,718
Death benefits.................................................................. 215,984 147,684
---------------- -----------------
1,301,564 1,818,649
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 1,833,087 10,558,307
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 161,109 15,157,877
EQUITY ACCOUNTS:
Beginning of period............................................................... 32,771,531 17,613,654
---------------- -----------------
End of period..................................................................... $ 32,932,640 $ 32,771,531
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
34
<PAGE> 36
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
BOND SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------------------------------------------
1996 1995 1994 1993 1992+
-------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of
period...................................... $ 12.61 $ 10.40 $ 11.33 $ 10.14 $ 10.00
Income from operations:
Net investment income (loss).............. .25 .64 .52 2.69 .64
Net realized and unrealized
gain (loss) on investment............... (.86) 1.57 (1.45) (1.50) (.50)
-------- -------- -------- ------- -------
Total income (loss) from operations..... (.61) 2.21 (.93) 1.19 .14
-------- -------- -------- ------- -------
Accumulation unit value, end of period........ $ 12.00 $ 12.61 $ 10.40 $ 11.33 $ 10.14
======== ======== ======== ======= =======
Total return.................................. (4.83)% 21.28% (8.23)% 11.81% 1.36%
Ratios and supplemental data:
Net assets at end of period (in
thousands)................................ $ 32,933 $ 32,772 $ 17,614 $ 17,280 $ 101
Ratio of net investment income (loss)
to average net assets**................... 4.01% 5.45% 4.91% 24.79% 6.30%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
35
<PAGE> 37
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Growth Portfolio
(7,361,909.095 shares;
cost $ 208,290,360)....................... $ 268,164,012
Accrued transfers from (to) depositor - net... 384,228
-------------
Total assets.............................. 268,548,240
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 268,548,240
=============
EQUITY ACCOUNTS:
Contract Owners' equity:
Growth sub-account
(17,036,758.298613 units;
$ 15.762872 unit value)................... $ 268,548,240
-------------
Total equity.............................. $ 268,548,240
=============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income........................... $ 466,311
Capital gain distributions................ 0
------------
466,311
EXPENSES:
Mortality and expense risk charges........ 1,583,181
------------
Net investment income (loss)............ (1,116,870)
------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................ 857,126
Change in unrealized appreciation
(depreciation).......................... 31,390,232
------------
Net gain (loss) on investments.......... 32,247,358
------------
Net increase (decrease) in equity
accounts resulting from
operations.......................... $ 31,130,488
============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (1,116,870) $ 16,764,464
Net gain (loss) on investments................................................... 32,247,358 38,316,882
-------------- -------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 31,130,488 55,081,346
-------------- -------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 46,092,961 40,690,699
-------------- -------------
Less cost of units redeemed:
Administrative charges......................................................... 121,535 173,999
Policy loans................................................................... 68,784 36,385
Surrender benefits............................................................. 6,162,067 9,406,104
Death benefits................................................................. 461,407 399,627
-------------- -------------
6,813,793 10,016,115
-------------- -------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 39,279,168 30,674,584
-------------- -------------
Net increase (decrease) in equity accounts..................................... 70,409,656 85,755,930
EQUITY ACCOUNTS:
Beginning of period.............................................................. 198,138,584 112,382,654
-------------- -------------
End of period.................................................................... $ 268,548,240 $ 198,138,584
============== =============
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
36
<PAGE> 38
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- --------------------------------------------------------------
1996 1995 1994 1993 1992+
--------- ---------- --------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of
period................................... $ 13.77 $ 9.49 $ 10.50 $ 10.24 $ 10.00
Income from operations:
Net investment income (loss)........... (.07) 1.30 (.03) .31 .39
Net realized and unrealized
gain (loss) on investment............ 2.06 2.98 (.98) (.05) (.15)
--------- ---------- --------- -------- -------
Total income (loss) from
operations......................... 1.99 4.28 (1.01) .26 .24
--------- ---------- --------- -------- -------
Accumulation unit value, end of period..... $ 15.76 $ 13.77 $ 9.49 $ 10.50 $ 10.24
========= =========== ========== ========= ========
Total return............................... 14.46% 45.08% (9.58)% 2.55% 2.38%
Ratios and supplemental data:
Net assets at end of period (in
thousands)............................. $ 268,548 $ 198,139 $ 112,383 $ 87,415 $ 102
Ratio of net investment income (loss)
to average net assets**................ (.96)% 11.07% (.26)% 3.14% 3.82%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
37
<PAGE> 39
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
SHORT-TO-INTERMEDIATE GOVERNMENT SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Short-to-Intermediate Government Portfolio
(1,464,364.538 shares;
cost $ 14,942,786)........................ $ 14,988,270
Accrued transfers from (to) depositor - net... (10,260 )
-------------
Total assets.............................. 14,978,010
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 14,978,010
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Short-to-Intermediate Government
sub-account
(1,327,344.514357 units;
$ 11.284192 unit value)................... $ 14,978,010
-------------
Total equity.............................. $ 14,978,010
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 241,346
Capital gain distributions.............. 0
----------------
241,346
EXPENSES:
Mortality and expense risk charges...... 94,417
----------------
Net investment income (loss).......... 146,929
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 82,862
Change in unrealized appreciation
(depreciation)........................ (331,699)
----------------
Net gain (loss) on investments........ (248,837)
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ (101,908)
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)........................................................ $ 146,929 $ 509,575
Net gain (loss) on investments...................................................... (248,837) 801,020
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations......................................................... (101,908) 1,310,595
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)................................................. 2,531,156 1,293,887
---------------- -----------------
Less cost of units redeemed:
Administrative charges............................................................ 3,744 7,052
Policy loans...................................................................... 0 31,238
Surrender benefits................................................................ 413,655 1,086,564
Death benefits.................................................................... 19,381 143,519
---------------- -----------------
436,780 1,268,373
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions....................................................... 2,094,376 25,514
---------------- -----------------
Net increase (decrease) in equity accounts........................................ 1,992,468 1,336,109
EQUITY ACCOUNTS:
Beginning of period................................................................. 12,985,542 11,649,433
---------------- -----------------
End of period....................................................................... $ 14,978,010 $ 12,985,542
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
38
<PAGE> 40
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
SHORT-TO-INTERMEDIATE GOVERNMENT SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- ----------------------------------------------------
1996 1995 1994 1993 1992+
-------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.38 $ 10.16 $ 10.35 $ 10.03 $ 10.00
Income from operations:
Net investment income (loss)................ .12 .48 .37 .30 .01
Net realized and unrealized
gain (loss) on investments................ (.22) .74 (.56) .02 .02
-------- -------- -------- -------- -------
Total income (loss) from operations....... (.10) 1.22 (.19) .32 .03
-------- -------- -------- -------- -------
Accumulation unit value, end of period.......... $ 11.28 $ 11.38 $ 10.16 $ 10.35 $ 10.03
========= ========= ========= ========= ========
Total return.................................... (.81)% 11.96% (1.81)% 3.12% .35%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 14,978 $ 12,986 $ 11,649 $ 13,564 $ 853
Ratio of net investment income (loss)
to average net assets**..................... 2.13% 4.39% 3.68% 2.98% .13%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
39
<PAGE> 41
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
GLOBAL SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Global Portfolio
(9,496,131.010 shares;
cost $ 139,623,911)....................... $ 177,054,917
Accrued transfers from (to) depositor - net... 202,990
-------------
Total assets.............................. 177,257,907
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 177,257,907
=============
EQUITY ACCOUNTS:
Contract Owners' equity:
Global sub-account
(9,150,267.268544 units;
$ 19.371883 unit value)................... $ 177,257,907
-------------
Total equity.............................. $ 177,257,907
=============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 159,076
Capital gain distributions.............. 0
-------------
159,076
EXPENSES:
Mortality and expense risk charges...... 983,816
-------------
Net investment income (loss).......... (824,740)
-------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 719,733
Change in unrealized appreciation
(depreciation)........................ 25,165,976
-------------
Net gain (loss) on investments........ 25,885,709
-------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 25,060,969
=============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (824,740) $ 2,936,895
Net gain (loss) on investments................................................... 25,885,709 16,567,912
------------- -------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 25,060,969 19,504,807
------------- -------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 44,488,536 3,172,478
------------- -------------
Less cost of units redeemed:
Administrative charges......................................................... 73,801 106,341
Policy loans................................................................... 70,310 5,024
Surrender benefits............................................................. 3,879,598 5,972,420
Death benefits................................................................. 226,321 464,451
------------- -------------
4,250,030 6,548,236
------------- -------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 40,238,506 (3,375,758)
------------- -------------
Net increase (decrease) in equity accounts..................................... 65,299,475 16,129,049
EQUITY ACCOUNTS:
Beginning of period.............................................................. 111,958,432 95,829,383
------------- -------------
End of period.................................................................... $ 177,257,907 $ 111,958,432
============= =============
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
40
<PAGE> 42
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
GLOBAL SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ----------------------------------------------------
1996 1995 1994 1993 1992+
--------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 16.22 $ 13.36 $ 13.52 $ 10.15 $ 10.00
Income from operations:
Net investment income (loss)................ (.10) .43 .53 .11 (.01)
Net realized and unrealized
gain (loss) on investment................. 3.25 2.43 (.69) 3.26 .16
--------- --------- -------- -------- -------
Total income (loss) from operations....... 3.15 2.86 (.16) 3.37 .15
--------- --------- -------- -------- -------
Accumulation unit value, end of period.......... $ 19.37 $ 16.22 $ 13.36 $ 13.52 $ 10.15
========== ========== ========= ========= ========
Total return.................................... 19.45% 21.35% (1.14)% 33.17% 1.51%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 177,258 $ 111,958 $ 95,829 $ 29,905 $ 254
Ratio of net investment income (loss)
to average net assets**..................... (1.15)% 2.96% 3.95% .99% (.11)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was December 3, 1992. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
41
<PAGE> 43
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
EQUITY-INCOME SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Equity-Income Portfolio
(9,288,721.669 shares;
cost $ 110,324,969)....................... $ 126,906,287
Accrued transfers from (to) depositor - net... 85,589
-------------
Total assets.............................. 126,991,876
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 126,991,876
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Equity-Income sub-account
(8,823,249.022512 units;
$ 14.392870 unit value)................... $ 126,991,876
-------------
Total equity.............................. $ 126,991,876
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 837,675
Capital gain distributions.............. 0
----------------
837,675
EXPENSES:
Mortality and expense risk charges...... 783,495
----------------
Net investment income (loss).......... 54,180
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 926,943
Change in unrealized appreciation
(depreciation)........................ 5,586,121
----------------
Net gain (loss) on investments........ 6,513,064
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 6,567,244
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 54,180 $ 4,061,486
Net gain (loss) on investments.................................................... 6,513,064 13,464,500
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 6,567,244 17,525,986
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 21,901,196 17,763,181
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 44,457 71,983
Policy loans.................................................................... 20,011 0
Surrender benefits.............................................................. 2,889,517 4,611,616
Death benefits.................................................................. 173,687 687,018
---------------- -----------------
3,127,672 5,370,617
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 18,773,524 12,392,564
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 25,340,768 29,918,550
Depositors' equity contribution (redemption)...................................... 0 0
EQUITY ACCOUNTS:
Beginning of period............................................................... 101,651,108 71,732,558
---------------- -----------------
End of period..................................................................... $ 126,991,876 $ 101,651,108
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
42
<PAGE> 44
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
EQUITY-INCOME SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ---------------------------------------
1996 1995 1994 1993+
--------- --------- -------- --------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 13.56 $ 11.03 $ 11.24 $ 10.00
Income from operations:
Net investment income (loss)................ .00 .59 .16 .20
Net realized and unrealized
gain (loss) on investment................. .83 1.94 (.37) 1.04
--------- --------- -------- --------
Total income (loss) from operations....... .83 2.53 (.21) 1.24
--------- --------- -------- --------
Accumulation unit value, end of period.......... $ 14.39 $ 13.56 $ 11.03 $ 11.24
========== ========== ========= =========
Total return.................................... 6.18% 22.93% (1.92)% 12.43%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 126,992 $ 101,651 $ 71,733 $ 28,312
Ratio of net investment income (loss)
to average net assets**..................... .09% 4.76% 1.49% 1.87%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
43
<PAGE> 45
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
EMERGING GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Emerging Growth Portfolio
(7,779,503.154 shares;
cost $ 110,058,885).................. $ 149,237,053
Accrued transfers from (to)
depositor - net........................ 407,618
-----------------
Total assets......................... 149,644,671
-----------------
LIABILITIES:............................... 0
-----------------
Total net assets..................... $ 149,644,671
===================
EQUITY ACCOUNTS:
Contract Owners' equity:
Emerging Growth sub-account
(7,810,196.566039 units;
$ 19.160167 unit value).............. $ 149,644,671
-----------------
Total equity......................... $ 149,644,671
===================
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income....................... $ 0
Capital gain distributions............ 0
-----------------
0
EXPENSES:
Mortality and expense risk charges.... 841,974
-----------------
Net investment income (loss)........ (841,974)
-----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from
securities transactions............. 3,040,456
Change in unrealized appreciation
(depreciation)...................... 16,764,921
-----------------
Net gain (loss) on investments...... 19,805,377
-----------------
Net increase (decrease) in equity
accounts resulting from
operations...................... $ 18,963,403
===================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (841,974) $ 3,189,124
Net gain (loss) on investments................................................... 19,805,377 27,441,608
----------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 18,963,403 30,630,732
----------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 29,416,341 16,786,688
----------------- -----------------
Less cost of units redeemed:
Administrative charges......................................................... 59,556 85,948
Policy loans................................................................... 64,860 13,781
Surrender benefits............................................................. 3,334,188 4,544,091
Death benefits................................................................. 391,279 273,410
----------------- -----------------
3,849,883 4,917,230
----------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 25,566,468 11,869,458
----------------- -----------------
Net increase (decrease) in equity accounts..................................... 44,529,861 42,500,190
EQUITY ACCOUNTS:
Beginning of period.............................................................. 105,114,810 62,614,620
----------------- -----------------
End of period.................................................................... $ 149,644,671 $ 105,114,810
=================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
44
<PAGE> 46
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
EMERGING GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- ---------------------------------------
1996 1995 1994 1993+
--------- --------- -------- --------
<S> <C> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 16.34 $ 11.29 $ 12.35 $ 10.00
Income from operations:
Net investment income (loss)................ (.12) .54 (.15) (.14)
Net realized and unrealized
gain (loss) on investments................ 2.94 4.51 (.91) 2.49
--------- --------- -------- --------
Total income (loss) from operations....... 2.82 5.05 (1.06) 2.35
--------- --------- -------- --------
Accumulation unit value, end of period.......... $ 19.16 $ 16.34 $ 11.29 $ 12.35
========== ========== ========= =========
Total return.................................... 17.28% 44.75% (8.65)% 23.54%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 149,645 $ 105,115 $ 62,615 $ 25,444
Ratio of net investment income (loss)
to average net assets**..................... (1.37)% 3.85% (1.33)% (1.20)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
45
<PAGE> 47
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
AGGRESSIVE GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Aggressive Growth Portfolio
(5,702,172.182 shares;
cost $ 75,302,958)........................ $ 79,892,150
Accrued transfers from (to) depositor - net... 169,921
------------
Total assets.............................. 80,062,071
------------
LIABILITIES:.................................... 0
------------
Total net assets.......................... $ 80,062,071
============
EQUITY ACCOUNTS:
Contract Owners' equity:
Aggressive Growth sub-account
(5,726,625.365666 units;
$ 13.980672 unit value)................... $ 80,062,071
------------
Total equity.............................. $ 80,062,071
============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income........................... $ 0
Capital gain distributions................ 0
------------
0
EXPENSES:
Mortality and expense risk charges........ 480,228
------------
Net investment income (loss)............ (480,228)
------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................ 2,601,404
Change in unrealized appreciation
(depreciation).......................... 877,912
------------
Net gain (loss) on investments.......... 3,479,316
------------
Net increase (decrease) in equity
accounts resulting from
operations.......................... $ 2,999,088
============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss).................................................... $ (480,228) $ 1,078,673
Net gain (loss) on investments.................................................. 3,479,316 5,453,504
------------- ------------
Net increase (decrease) in equity accounts
resulting from operations..................................................... 2,999,088 6,532,177
------------- ------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................. 18,486,311 44,671,168
------------- ------------
Less cost of units redeemed:
Administrative charges........................................................ 28,880 26,869
Policy loans.................................................................. 44,807 8,808
Surrender benefits............................................................ 1,732,826 1,799,668
Death benefits................................................................ 36,358 78,444
------------- ------------
1,842,871 1,913,789
------------- ------------
Increase (decrease) in equity accounts from
capital unit transactions................................................... 16,643,440 42,757,379
------------- ------------
Net increase (decrease) in equity accounts.................................... 19,642,528 49,289,556
Depositors' equity contribution (redemption).................................... 0 (272,958)
EQUITY ACCOUNTS:
Beginning of period............................................................. 60,419,543 11,402,945
------------- ------------
End of period................................................................... $ 80,062,071 $ 60,419,543
============= ============
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
46
<PAGE> 48
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
AGGRESSIVE GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------
1996 1995 1994+
-------- -------- --------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 13.31 $ 9.78 $ 10.00
Income from operations:
Net investment income (loss)................ (.09) .40 (.10)
Net realized and unrealized
gain (loss) on investments................ .76 3.13 (.12)
-------- -------- --------
Total income (loss) from operations....... .67 3.53 (.22)
-------- -------- --------
Accumulation unit value, end of period.......... $ 13.98 $ 13.31 $ 9.78
========= ========= =========
Total return.................................... 5.01% 36.10% (2.18)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 80,062 $ 60,420 $ 11,403
Ratio of net investment income (loss)
to average net assets**..................... (1.37)% 3.04% (.99)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1994. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
47
<PAGE> 49
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
BALANCED SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Balanced Portfolio
(2,001,078.598 shares;
cost $ 20,039,020)........................ $ 21,854,272
Accrued transfers from (to) depositor - net... (29,288 )
-------------
Total assets.............................. 21,824,984
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 21,824,984
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Balanced sub-account
(1,927,304.609303 units;
$ 11.324097 unit value)................... $ 21,824,984
-------------
Total equity.............................. $ 21,824,984
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 137,522
Capital gain distributions.............. 0
----------------
137,522
EXPENSES:
Mortality and expense risk charges...... 129,225
----------------
Net investment income (loss).......... 8,297
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 66,588
Change in unrealized appreciation
(depreciation)........................ 483,889
----------------
Net gain (loss) on investments........ 550,477
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 558,774
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................................... $ 8,297 $ 383,272
Net gain (loss) on investments.................................................... 550,477 1,697,980
---------------- -----------------
Net increase (decrease) in equity accounts
resulting from operations....................................................... 558,774 2,081,252
---------------- -----------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................... 6,030,834 6,741,534
---------------- -----------------
Less cost of units redeemed:
Administrative charges.......................................................... 6,008 8,055
Policy loans.................................................................... 387 0
Surrender benefits.............................................................. 604,792 543,786
Death benefits.................................................................. 4,224 137,777
---------------- -----------------
615,411 689,618
---------------- -----------------
Increase (decrease) in equity accounts from
capital unit transactions..................................................... 5,415,423 6,051,916
---------------- -----------------
Net increase (decrease) in equity accounts...................................... 5,974,197 8,133,168
Depositors' equity contribution (redemption)...................................... (218,007) 0
EQUITY ACCOUNTS:
Beginning of period............................................................... 16,068,794 7,935,626
---------------- -----------------
End of period..................................................................... $ 21,824,984 $ 16,068,794
================== ===================
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
48
<PAGE> 50
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
BALANCED SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- ----------------------
1996 1995 1994+
-------- -------- -------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.03 $ 9.34 $ 10.00
Income from operations:
Net investment income (loss)................ .00 .32 .27
Net realized and unrealized
gain (loss) on investments................ .29 1.37 (.93)
-------- -------- -------
Total income (loss) from operations....... .29 1.69 (.66)
-------- -------- -------
Accumulation unit value, end of period.......... $ 11.32 $ 11.03 $ 9.34
========= ========= ========
Total return.................................... 2.64% 18.13% (6.61)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 21,825 $ 16,069 $ 7,936
Ratio of net investment income (loss)
to average net assets**..................... .09% 3.16% 2.90%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
49
<PAGE> 51
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
UTILITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Utility Portfolio (1,240,167.395 shares;
cost $ 13,243,360)........................ $ 14,317,907
Accrued transfers from (to) depositor - net... 7,119
------------
Total assets.............................. 14,325,026
------------
LIABILITIES:.................................... 0
------------
Total net assets.......................... $ 14,325,026
============
EQUITY ACCOUNTS:
Contract Owners' equity:
Utility sub-account
(1,182,525.556818 units;
$ 12.113925 unit value)................... $ 14,325,026
------------
Total equity.............................. $ 14,325,026
============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income........................... $ 91,408
Capital gain distributions................ 0
----------
91,408
EXPENSES:
Mortality and expense risk charges........ 83,602
----------
Net investment income (loss)............ 7,806
----------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................ 184,628
Change in unrealized appreciation
(depreciation).......................... 275,425
----------
Net gain (loss) on investments.......... 460,053
----------
Net increase (decrease) in equity
accounts resulting from
operations.......................... $ 467,859
==========
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1996 DECEMBER 31, 1995
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ 7,806 $ 297,189
Net gain (loss) on investments................................................... 460,053 1,157,763
------------ -------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 467,859 1,454,952
------------ -------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 4,501,106 5,146,911
------------ -------------
Less cost of units redeemed:
Administrative charges......................................................... 3,778 4,161
Policy loans................................................................... 0 193
Surrender benefits............................................................. 340,011 210,465
Death benefits................................................................. 155,439 87,803
------------ -------------
499,228 302,622
------------ -------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 4,001,878 4,844,289
------------ -------------
Net increase (decrease) in equity accounts..................................... 4,469,737 6,299,241
Depositors' equity contribution (redemption)..................................... (230,353) 0
EQUITY ACCOUNTS:
Beginning of period.............................................................. 10,085,642 3,786,401
------------ -------------
End of period.................................................................... $ 14,325,026 $ 10,085,642
============ =============
</TABLE>
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
50
<PAGE> 52
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
UTILITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
-------- -----------------------
1996 1995 1994+
-------- -------- --------
<S> <C> <C> <C>
Accumulation unit value, beginning of period.... $ 11.68 $ 9.45 $ 10.00
Income from operations:
Net investment income (loss)................ .01 .47 .33
Net realized and unrealized
gain (loss) on investments................ .42 1.76 (.88)
-------- -------- --------
Total income (loss) from operations....... .43 2.23 (.55)
-------- -------- --------
Accumulation unit value, end of period.......... $ 12.11 $ 11.68 $ 9.45
========= ========= =========
Total return.................................... 3.75% 23.52% (5.47)%
Ratios and supplemental data:
Net assets at end of period (in
thousands)................................ $ 14,325 $ 10,086 $ 3,786
Ratio of net investment income (loss)
to average net assets**................... .13% 4.50% 3.48%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was March 1, 1993. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
51
<PAGE> 53
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
TACTICAL ASSET ALLOCATION SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Tactical Asset Allocation Portfolio
(10,159,789.621 shares;
cost $ 116,917,232)....................... $ 121,717,692
Accrued transfers from (to) depositor - net... 180,663
--------------
Total assets.............................. 121,898,355
--------------
LIABILITIES:.................................... 0
--------------
Total net assets.......................... $ 121,898,355
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Tactical Asset Allocation sub-account
(9,887,996.083956 units;
$ 12.327913 unit value)................... $ 121,898,355
--------------
Total equity.............................. $ 121,898,355
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INVESTMENT INCOME: JUNE 30, 1996
<S> <C>
Dividend income......................... $ 653,554
Capital gain distributions.............. 0
----------------
653,554
EXPENSES:
Mortality and expense risk charges...... 703,654
----------------
Net investment income (loss).......... (50,100)
----------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions.......................... 574,850
Change in unrealized appreciation
(depreciation)........................ 2,878,944
----------------
Net gain (loss) on investments........ 3,453,794
----------------
Net increase (decrease) in equity
accounts resulting from
operations........................ $ 3,403,694
==================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERIOD ENDED
JUNE 30, 1996 DECEMBER 31, 1995*
<S> <C> <C>
OPERATIONS:
Net investment income (loss)..................................................... $ (50,100) $ 2,115,992
Net gain (loss) on investments................................................... 3,453,794 3,169,620
---------------- ------------------
Net increase (decrease) in equity accounts
resulting from operations...................................................... 3,403,694 5,285,612
---------------- ------------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed).............................................. 50,438,742 70,478,164
---------------- ------------------
Less cost of units redeemed:
Administrative charges......................................................... 15,917 7,030
Policy loans................................................................... 2,478 8,139
Surrender benefits............................................................. 4,195,211 3,423,825
Death benefits................................................................. 30,084 18,074
---------------- ------------------
4,243,690 3,457,068
---------------- ------------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................... 46,195,052 67,021,096
---------------- ------------------
Net increase (decrease) in equity accounts..................................... 49,598,746 72,306,708
Depositors' equity contributions (redemption).................................... 0 (7,099)
EQUITY ACCOUNTS:
Beginning of period.............................................................. 72,299,609 0
---------------- ------------------
End of period.................................................................... $ 121,898,355 $ 72,299,609
================== ====================
</TABLE>
* The inception date of this sub-account was January 3, 1995.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
52
<PAGE> 54
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
TACTICAL ASSET ALLOCATION SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30 DECEMBER 31
--------- -----------
1996 1995+
--------- -----------
<S> <C> <C>
Accumulation unit value, beginning of period.... $ 11.84 $ 10.00
Income from operations:
Net investment income (loss)................ .00 .82
Net realized and unrealized
gain (loss) on investments................ .49 1.02
--------- -----------
Total income (loss) from operations....... .49 1.84
--------- -----------
Accumulation unit value, end of period.......... $ 12.33 $ 11.84
========== =============
Total return.................................... 4.09% 18.43%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 121,898 $ 72,300
Ratio of net investment income (loss)
to average net assets**..................... (.10)% 7.29%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was January 3, 1995. The total return
is not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
53
<PAGE> 55
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
C.A.S.E. GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
C.A.S.E. Growth Portfolio
(135,764.167 shares;
cost $ 1,713,621)........................ $ 1,689,819
Accrued transfers from (to)
depositor - net............................ 69,370
-------------
Total assets............................. 1,759,189
-------------
LIABILITIES:................................... 0
-------------
Total net assets......................... $ 1,759,189
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
C.A.S.E. Growth sub-account
(175,930.392912 units;
$ 9.859248 unit value)................... $ 1,734,541
Depositors' equity:
C.A.S.E. Growth sub-account
(2,500.000000 units;
$ 9.859248 unit value)................... 24,648
-------------
Total equity............................. $ 1,759,189
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income...................... $ 0
Capital gain distributions........... 0
--------------------
0
EXPENSES:
Mortality and expense risk charges... 1,838
--------------------
Net investment income (loss)....... (1,838)
--------------------
Net realized and unrealized gain (loss)
on investments:
Net realized gain (loss) from
securities transactions............ 28
Change in unrealized appreciation
(depreciation)..................... (23,802)
--------------------
Net gain (loss) on investments..... (23,774)
--------------------
Net increase (decrease) in equity
accounts resulting from
operations..................... $ (25,612)
=====================
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)............................................................................. $ (1,838)
Net gain (loss) on investments........................................................................... (23,774)
--------------------
Net increase (decrease) in equity accounts
resulting from operations.............................................................................. (25,612)
--------------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)...................................................................... 1,761,799
--------------------
Less cost of units redeemed:
Administrative charges................................................................................. 68
Policy loans........................................................................................... 0
Surrender benefits..................................................................................... 1,930
Death benefits......................................................................................... 0
--------------------
1,998
--------------------
Increase (decrease) in equity accounts from
capital unit transactions............................................................................ 1,759,801
--------------------
Net increase (decrease) in equity accounts............................................................. 1,734,189
Depositors' equity contributions (redemption)............................................................ 25,000
EQUITY ACCOUNTS:
Beginning of period...................................................................................... 0
--------------------
End of period............................................................................................ $ 1,759,189
=====================
</TABLE>
* The inception date of this sub-account was May 1, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
54
<PAGE> 56
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
C.A.S.E. GROWTH SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
--------
1996+
--------
<S> <C>
Accumulation unit value, beginning of period.... $ 10.00
Income from operations:
Net investment income (loss)................ (.02)
Net realized and unrealized
gain (loss) on investments................ (.12)
--------
Total income (loss) from operations....... (.14)
--------
Accumulation unit value, end of period.......... $ 9.86
=========
Total return.................................... (1.41)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 1,759
Ratio of net investment income (loss)
to average net assets**..................... (1.27)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was May 1, 1996. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
55
<PAGE> 57
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
MERIDIAN/INVESCO GLOBAL SECTOR SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Meridian/INVESCO Global Sector Portfolio
(41,218.768 shares;
cost $ 413,661)........................... $ 411,522
Accrued transfers from (to) depositor - net... 52,543
-------------
Total assets.............................. 464,065
-------------
LIABILITIES:.................................... 0
-------------
Total net assets.......................... $ 464,065
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Meridian/INVESCO Global Sector sub-account
(46,586.836044 units;
$ 9.961291 unit value).................... $ 464,065
-------------
Total equity.............................. $ 464,065
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income............................ $ 0
Capital gain distributions................. 0
--------------
0
EXPENSES:
Mortality and expense risk charges......... 290
--------------
Net investment income (loss)............. (290)
--------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................. (187)
Change in unrealized appreciation
(depreciation)........................... (2,139)
--------------
Net gain (loss) on investments........... (2,326)
--------------
Net increase (decrease) in equity
accounts resulting from operations... $ (2,616)
===============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)................................................................................... $ (290)
Net gain (loss) on investments................................................................................. (2,326)
--------------
Net increase (decrease) in equity accounts
resulting from operations.................................................................................... (2,616)
--------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................................................ 466,681
--------------
Less cost of units redeemed:
Administrative charges....................................................................................... 0
Policy loans................................................................................................. 0
Surrender benefits........................................................................................... 0
Death benefits............................................................................................... 0
--------------
0
--------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................................................. 466,681
--------------
Net increase (decrease) in equity accounts................................................................... 464,065
Depositors' equity contributions (redemption).................................................................. 0
EQUITY ACCOUNTS:
Beginning of period............................................................................................ 0
--------------
End of period.................................................................................................. $ 464,065
===============
</TABLE>
* The inception date of this sub-account was May 1, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
56
<PAGE> 58
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
MERIDIAN/INVESCO GLOBAL SECTOR SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
-------
1996+
-------
<S> <C>
Accumulation unit value, beginning of period.... $10.00
Income from operations:
Net investment income (loss)................ (.02)
Net realized and unrealized
gain (loss) on investments................ (.02)
-------
Total income (loss) from operations....... (.04)
-------
Accumulation unit value, end of period.......... $ 9.96
========
Total return.................................... (.39)%
Ratios and supplemental data:
Net assets at end of period (in thousands).... $ 464
Ratio of net investment income (loss)
to average net assets**..................... (1.20)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was May 1, 1996. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
57
<PAGE> 59
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
VALUE EQUITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS, LIABILITIES AND EQUITY ACCOUNTS
<TABLE>
<CAPTION>
ASSETS: JUNE 30, 1996
<S> <C>
Investments, at net asset value:
WRL Series Fund, Inc.:
Value Equity Portfolio
(151,732.534 shares;
cost $ 1,522,357)......................... $ 1,528,992
Accrued transfers from (to) depositor - net... 34,955
--------------
Total assets.............................. 1,563,947
--------------
LIABILITIES:.................................... 0
--------------
Total net assets.......................... $ 1,563,947
==============
EQUITY ACCOUNTS:
Contract Owners' equity:
Value Equity sub-account
(140,552.964309 units;
$ 10.054111 unit value)................... $ 1,413,135
Depositors' equity:
Value Equity sub-account
(15,000.000000 units;
$ 10.054111 unit value)................... 150,812
--------------
Total equity.............................. $ 1,563,947
==============
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD ENDED
INVESTMENT INCOME: JUNE 30, 1996*
<S> <C>
Dividend income............................ $ 0
Capital gain distributions................. 0
--------------
0
EXPENSES:
Mortality and expense risk charges......... 1,218
--------------
Net investment income (loss)............. (1,218)
--------------
Net realized and unrealized gain (loss) on
investments:
Net realized gain (loss) from securities
transactions............................. 1
Change in unrealized appreciation
(depreciation)........................... 6,635
--------------
Net gain (loss) on investments........... 6,636
--------------
Net increase (decrease) in equity
accounts resulting from operations... $ 5,418
===============
</TABLE>
STATEMENT OF CHANGES IN EQUITY ACCOUNTS
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1996*
<S> <C>
OPERATIONS:
Net investment income (loss)................................................................................... $ (1,218)
Net gain (loss) on investments................................................................................. 6,636
--------------
Net increase (decrease) in equity accounts
resulting from operations.................................................................................... 5,418
--------------
EQUITY TRANSACTIONS:
Proceeds from units sold (redeemed)............................................................................ 1,408,530
--------------
Less cost of units redeemed:
Administrative charges....................................................................................... 1
Policy loans................................................................................................. 0
Surrender benefits........................................................................................... 0
Death benefits............................................................................................... 0
--------------
1
--------------
Increase (decrease) in equity accounts from
capital unit transactions.................................................................................. 1,408,529
--------------
Net increase (decrease) in equity accounts................................................................... 1,413,947
Depositors' equity contributions (redemption).................................................................. 150,000
EQUITY ACCOUNTS:
Beginning of period............................................................................................ 0
--------------
End of period.................................................................................................. $ 1,563,947
===============
</TABLE>
* The inception date of this sub-account was May 1, 1996.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
58
<PAGE> 60
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
VALUE EQUITY SUB-ACCOUNT
(UNAUDITED)
- --------------------------------------------------------------------------------
SELECTED PER UNIT DATA AND RATIOS*
FOR THE PERIOD ENDED
<TABLE>
<CAPTION>
JUNE 30
-------
1996+
-------
<S> <C>
Accumulation unit value, beginning of period.... $10.00
Income from operations:
Net investment income (loss)................ (.02)
Net realized and unrealized
gain (loss) on investments................ .07
-------
Total income (loss) from operations....... .05
-------
Accumulation unit value, end of period.......... $10.05
========
Total return.................................... .54 %
Ratios and supplemental data:
Net assets at end of period (in thousands).... $1,564
Ratio of net investment income (loss)
to average net assets**..................... (1.23)%
</TABLE>
* The above table illustrates the change for a unit outstanding computed using
average units outstanding throughout each period.
** This ratio is annualized for the period ended June 30, 1996.
+ The inception date of this sub-account was May 1, 1996. The total return is
not annualized.
The notes to the financial statements are an integral part of this report.
- --------------------------------------------------------------------------------
59
<PAGE> 61
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
- --------------------------------------------------------------------------------
JUNE 30, 1996
NOTE 1 - ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
The WRL Series Annuity Account (the "Annuity Account") was established as a
variable accumulation deferred annuity separate account of Western Reserve Life
Assurance Co. of Ohio ("WRL") and is registered as a unit investment trust
("Trust") under the Investment Company Act of 1940, as amended. The Annuity
Account encompasses various contract types: the WRL Freedom Variable Annuity and
the WRL Freedom Attainer ("Annuity #1"); the WRL Freedom Bellwether and the WRL
Freedom Conqueror ("Annuity #2"). Each contains fourteen investment options
referred to as sub-accounts. Each sub-account invests in the corresponding
portfolio of the WRL Series Fund, Inc. (the "Fund"), a registered management
investment company under the Investment Company Act of 1940, as amended. These
portfolios and their respective investment management organizations are as
follows:
<TABLE>
<CAPTION>
PORTFOLIO INVESTMENT MANAGER
- ----------------------- -----------------------------
<S> <C>
Money Market J.P. Morgan Investment
Management Inc
Bond Janus Capital Corporation
("JCC")
Growth JCC
Short-to Intermediate AEGON USA Investment
Government Management, Inc. ("AEGON
Management")
Global JCC
Equity-Income Luther King Capital
Management Corporation
Emerging Growth Van Kampen American Capital
Asset Management, Inc.
Aggressive Growth Fred Alger Management, Inc.
Balanced AEGON Management
Utility Federated Investment
Counseling
Tactical Asset Dean Investment Associates
Allocation
C.A.S.E. Growth C.A.S.E. Management, Inc.
Meridian/INVESCO Global Meridian Investment
Sector Management
Corporation/INVESCO Global
Asset Management Limited
Value Equity NWQ Investment Management
Company, Inc.
</TABLE>
WRL and AEGON Management are indirectly wholly-owned subsidiaries of AEGON
USA, Inc., which is an indirect wholly-owned subsidiary of AEGON nv, a
Netherlands corporation.
On May 1, 1996, WRL made an initial contribution to the Annuity Account.
The amount of the contribution and units received from the corresponding
sub-accounts are as follows:
<TABLE>
<CAPTION>
SUB-ACCOUNT CONTRIBUTION UNITS
- ----------------------- ------------ -------------
<S> <C> <C>
C.A.S.E. Growth........ $ 25,000 2,500.000000
Value Equity........... 150,000 15,000.000000
</TABLE>
The Annuity #2 sub-accounts were established on December 3, 1992 to hold
assets that support the benefits under certain flexible payment variable
accumulation deferred annuity contracts (the "Contracts") issued by WRL. The
Annuity Account equity transactions are accounted for using the appropriate
effective date at the corresponding accumulation unit value.
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
The following significant accounting policies, which are in conformity with
generally accepted accounting principles for unit investment trusts, have been
consistently used in preparation of the Trust's financial statements.
A. VALUATION OF INVESTMENTS
The investments in the Fund's shares are stated at the closing net asset
value ("NAV") per share as determined by the Fund on June 30, 1996.
Investment transactions are accounted for on the trade date, using the Fund
NAV next determined after receipt of sale or redemption order without sales
charges. Dividend income and capital gain distributions are recorded on the
ex-dividend date. The cost of investments sold is determined on a first-in,
first-out basis.
B. FEDERAL INCOME TAXES
The operations of the Annuity Account are a part of and are taxed with the
total operations of WRL, which is taxed as a life insurance company under
the Internal Revenue Code. Under current law, the investment income of the
Annuity Account, including realized and unrealized capital gains, is not
taxable
- --------------------------------------------------------------------------------
60
<PAGE> 62
WRL SERIES ANNUITY ACCOUNT
BELLWETHER AND CONQUEROR
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
- --------------------------------------------------------------------------------
NOTE 1 (CONTINUED)
to WRL. Accordingly, no provision for Federal income taxes has been made.
NOTE 2 - CHARGES AND DEDUCTIONS
Charges are assessed by WRL in connection with issuance and administration
of the Contracts.
A. CONTRACT CHARGES
No deduction for sales expenses are made from the purchase payments. A
contingent deferred sales charge may, however, be assessed against contract
values when withdrawn or surrendered.
On each anniversary through maturity date, WRL will deduct an annual
contract charge as partial compensation for providing administrative
services under the Contracts.
B. ANNUITY #2 SUB-ACCOUNTS CHARGES
A daily charge equal to an annual rate of 1.40% of average daily net assets
is assessed to compensate WRL for assumption of mortality and expense risks
and administrative services in connection with issuance and administration
of the Contracts. This charge (not assessed at the individual contract
level) effectively reduces the value of a unit outstanding during the year.
NOTE 3 - DIVIDENDS AND DISTRIBUTIONS
Dividends of the Fund's Money Market Portfolio are declared daily and
reinvested monthly. Dividends of the remaining portfolios are declared and
reinvested semiannually, while capital gain distributions are declared and
reinvested annually. Dividends and distributions of the Fund are generally paid
to and reinvested by the Annuity Account the next business day after
declaration.
NOTE 4 - OTHER MATTERS
As of June 30, 1996 the equity accounts include net unrealized appreciation
(depreciation) on investments as follows:
<TABLE>
<CAPTION>
SUB-ACCOUNT
- ----------------------------------------
<S> <C>
Money Market............................ $ n/a
Bond.................................... (799,851)
Growth.................................. 59,873,652
Short-to-Intermediate Government........ 45,484
Global.................................. 37,431,006
Equity-Income........................... 16,581,318
Emerging Growth......................... 39,178,168
Aggressive Growth....................... 4,589,192
Balanced................................ 1,815,252
Utility................................. 1,074,547
Tactical Asset Allocation............... 4,800,460
C.A.S.E. Growth......................... (23,802)
Meridian/INVESCO Global Sector.......... (2,139)
Value Equity............................ 6,635
</TABLE>
- --------------------------------------------------------------------------------
61
<PAGE> 63
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<PAGE> 64
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<PAGE> 65
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<PAGE> 66
- --------------------------------------------------------------------------------
WRL SERIES ANNUITY ACCOUNT
- --------------------------------------------------------------------------------
OFFICE OF THE
WRL SERIES ANNUITY ACCOUNT
201 Highland Avenue
Largo, FL 33770-2597
1-800-851-9777
Ext. 6538
---------------------------------------------
DISTRIBUTOR:
InterSecurities, Inc.
201 Highland Avenue
Largo, FL 33770-2597
---------------------------------------------
INSURER:
Western Reserve Life Assurance Co. of Ohio
201 Highland Avenue
Largo, FL 33770-2597
---------------------------------------------
INDEPENDENT ACCOUNTANTS:
Price Waterhouse LLP
1055 Broadway
Kansas City, MO 64105
<PAGE> 67
THIS MATERIAL IS FOR CONTRACT HOLDER'S
REPORTING PURPOSES ONLY AND SHALL NOT BE
USED IN CONNECTION WITH A SOLICITATION,
OFFER OR ANY PROPOSED SALE OR PURCHASE
OF SECURITIES. THIS MATERIAL MUST BE
PRECEDED OR ACCOMPANIED BY A PROSPECTUS.
(WRL LOGO)
- --------------------------------------------------------------------------------
Western Reserve Life Assurance Co. of Ohio
Distributor: InterSecurities, Inc.
201 Highland Avenue - Largo, FL 33770-2597
August 1996
ACC00002-S (8/96)
