AUL American Series Fund, Inc.
Annual Report
December 31, 1995<PAGE>
asxc
<PAGE>
This report may be used as sales literature only when accompanied
or preceded by effective
prospectuses of AUL
American Series Fund, Inc. and AUL American Unit Trust or AUL
American Individual Unit
Trust, which relate sales
expense and other pertinent information.<PAGE>
A Message
From
The Chairman of the Board
and President<PAGE>
Last year was a spectacular year for the equity and bond markets.
Domestic stocks were driven by
modest economic growth, low
inflation, declining interest rates and profit expansion. Meanwhile,
baby boomers helped
contribute to the market surge by
investing in retirement products. Near the end of 1995, the stock
market cheered as the Federal
Reserve lowered short-term
interest rates, thereby providing an extra boost to the economy
during 1996.
Although 1995 was an impressive year for stocks, the stock market
became highly rotational as
investors shifted rapidly from one
sector to another during the year. This meant that if an investor did
not keep rotating from sector
to sector with perfect timing, his
or her performance would have lagged the overall market.
The bond market also enjoyed a solid performance in 1995
following one of the worst years ever
in 1994. Yields declined
dramatically at every point on the yield curve resulting in double
digit returns for most bond
funds. Aggressive buying by bond
investors in 1995 was fueled by prospects for a reduction in the
federal deficit, signs of economic
weakness, moderate inflation,
and the likelihood of more easing by the Federal Reserve.
Now in the fifth year of an economic expansion, economists are
projecting this trend will continue
into 1996. The Federal Reserve
has been successful at keeping inflationary pressures in check
during this prolonged expansion.
Interest rates could decline during
1996, but the move will be much smaller than in 1995. Corporate
profits should continue to
expand, but the rate of earnings
growth is expected to decline.
After experiencing such a phenomenal year in 1995, equity
investors have become complacent
with above average returns.
However, it is not likely that 1996 will be a repeat of 1995's banner
year. Achieving double digit
bond performance may also be
difficult given today's much lower level of interest rates. Yet bonds
could still perform well if this
low inflation, low growth, low
interest rate scenario persists throughout 1996.
Investment performance for the AUL American Series Fund, Inc.
for the year 1995 was:
Equity Portfolio 19.5% Managed Portfolio
19.1%
Money Market Portfolio 5.1% Tactical Asset
Allocation(1) 6.5%
Bond Portfolio 17.8% (1) For the period
7/31/95 to 12/31/95
We suggest your careful review of the Portfolio Manager
comments found in the following pages
comparing these returns to other
indices. Tactical Asset Allocation Portfolio Manager comments and
comparisons have not been
included since the portfolio was in
operation for less than six months during 1995.
The performance numbers for the AUL American Series Fund, Inc.
are net of investment advisory
fees and other expenses paid
by each portfolio but do not reflect specified contract charges and
mortality and expense risks
charges which may be incurred
when investing in a variable annuity contract.
<PAGE>
James W. Murphy
Chairman of the Board of Directors and President
<PAGE>
Indianapolis, Indiana
January 19, 1996
<PAGE>
Directors and Officers of AUL American Series Fund, Inc.
James W. Murphy, Chairman of the Board and President
James P. Shanahan, Director, Vice President and Treasurer
Dr. Ronald D. Anderson, Director
Dr. H. Raymond Swenson,Director
Professor, School of Business Professor, College of Business
Indiana University, Indianapolis, Indiana Butler University,
Indianapolis, Indiana
Leonard D. Schutt, Director
Richard A. Wacker, Secretary
<PAGE>
A Message
From
Kathryn Hudspeth,
Portfolio Manager
of Equity Portfolio
<PAGE>
The Equity Portfolio invests primarily in equity securities selected
on the basis of fundamental
investment research for their
long-term growth prospects. Using a bottom-up approach, the
Portfolio concentrates on
companies which appear undervalued
compared to the market and their own historic valuation levels.
Other important considerations
include management ability, free
cash flow, insider ownership and dominance within its industry.
The stock market exhibited an impressive upward advance during
1995 with major stock indices
establishing new all-time highs
repeatedly as the year progressed. It appeared that "all news was
good news" to the equity market
and nothing was able to dampen
the enthusiasm. However, the phenomenal returns of the S&P 500
(a commonly used stock
benchmark) masked the underlying
volatility of the marketplace.
During the first quarter of 1995, large growth companies easily
outperformed the rest of the
market. This trend eased during the
second quarter as investors rotated into smaller companies and
technology names. As investors
shifted into financial stocks in July,
the technology sector began to falter. Beginning in September,
investors shifted their focus again
by moving out of small
capitalization stocks, causing this area to vastly underperform the
rest of the market.
Overall, 1995 was an impressive year for stocks with the S&P 500
advancing 37.5%. No single
investment theme prevailed
throughout the year due to rapid sector rotation. However, big
growth companies with high
price/earnings ratios tended to
outperform smaller value companies trading at lower price/earnings
ratios.
The Equity Portfolio utilizes a value approach which was out of
favor in 1995. Even though
absolute performance of 19.5% was
attractive versus historic market averages, relative returns lagged in
1995.
The Equity Portfolio benefitted from its concentration in
technology and pharmaceutical
companies. However, exposure to the
technology sector was reduced during the second half of 1995 as
many of these stocks became
expensive compared to the rest of
the market. The consumer cyclical sector was the worst performing
sector during 1995. As this
area appeared the most
undervalued versus the rest of the market, additional investments
were made in this area
throughout the year.
After experiencing such phenomenal returns during 1995, one has
to wonder what lies ahead for
the stock market during 1996.
Investors are concerned about the longevity of the current
economic expansion and the likelihood
of another dramatic decline in
interest rates. Corporations have been extremely active in cutting
costs and improving
productivity. However, corporations may be
at the peak of their profit cycle. Considering these factors, it is
unlikely that 1996 market
performance will be a repeat of 1995.
<PAGE>
AUL American Series Fund, Inc. Equity Portfolio
The graph for the AUL American Series Fund Equity Portfolio
shows the
portfolio's total returns, which include changes in share price and
reinvestment of dividends and capital gains. The graph depicts how
a
$10,000 investment made on the fund's inception date (April 10,
1990)
would have performed through December 31, 1995. The vertical
axis of
the graph is labeled with the cumulative dollar amount (in
thousands), and
the horizontal axis of the graph is labeled with calendar quarter-end
time
periods. The cumulative dollar value of the original $10,000
investment is
plotted for each quarter-end date, and the graph is drawn through
these
points. The cumulative value of a $10,000 investment made on the
inception date of the Equity Portfolio would be $19,228, indicating
a 12.1%
return.
Performance numbers are net of all portfolio operating expenses,
but do not
include any separate account or contractual charges. If
performance
information included the effect of these additional charges, it would
be
lower.
The Equity Portfolio is compared against the performance of the
S&P 500,
an unmanaged index of common stocks. Figures for this index
include
reinvestment of income and capital gains, and are calculated
similarly to the
Equity Portfolio, with a hypothetical $10,000 investment made on
April
10,1990 taken out to December 31,1995. The cumulative value of
this
hypothetical investment made on this date would be $21, 313.
Equity S&P 500
Portfolio
One Year 19.5% 37.5%
Five Years 14.2% 16.6%
Since Inception (4/10/90) 12.1% 14.2%
Value of a hypothetical $10,000
investment made 4/10/90 $19,228 $21,313
<PAGE>
The charts show the Equity Portfolio's total returns, which include
changes in share price and
reinvestment of dividends and
capital gains. Figures for the S&P 500, an unmanaged index of
common stocks, include
reinvestment of dividends and capital
gains. S&P 500 is a registered trademark of Standard & Poor's
Corporation. The inception figures
are from commencement of
operations.
Performance numbers for the Equity Portfolio are net of all
portfolio operating expenses, but do
not include separate account or
contract charges. If the performance data included the effect of
these charges, the returns would
be lower. Past performance is no
guarantee of future results. Principal and investment return will vary
so shares may be worth more
or less than their original cost
when redeemed.<PAGE>
A Message
From
Kent Adams,
Portfolio Manager
of Bond Portfolio
<PAGE>
The AUL American Bond Portfolio invests primarily in U.S.
Treasury and Agency bonds and
notes, investment grade corporate
bonds, and U.S. Agency-backed residential mortgage obligations.
Portfolio holdings may range in
maturity from overnight money
market investments to bonds with maturities as long as 30 years.
The average maturity of the
portfolio is shortened or lengthened
depending on the outlook for interest rates. The mix of corporate
bonds, U.S. Agencies and
Treasuries, and mortgage-backed
securities in the Portfolio is varied depending on the relative
attractiveness of these sectors.
The total return for the Bond Portfolio in 1995 was 17.8%. This
return represents interest income
plus the price increase of the
fixed income securities held in the Portfolio. The Bond Fund
experienced a high return in 1995
because of significant price
appreciation in intermediate and longer term bonds resulting from
the large decline in interest
rates during the year. The total
return for the Lehman Government/Corporate Index was 19.2% for
1995.
At the beginning of 1995 the Bond Portfolio's average duration was
slightly longer than the
Lehman Government/Corporate Index
in recognition of the higher level of interest rates available at that
time. As interest rates declined
and bond prices increased during
the year, the average duration of the Portfolio was shortened
somewhat. When the Federal
Reserve Bank reduced the Federal
Funds rate to 5.75% in July, the percentage of the Portfolio
invested in cash and short-term
Treasuries was decreased while the
percentage invested in intermediate maturity Treasuries and
Agencies was increased, especially
when yields in excess of 6% were
available. In the fourth quarter, purchases of intermediate and
longer maturity Treasury bonds
increased the average duration of
the Portfolio to slightly longer than that of the Lehman
Government/Corporate Index.
Over one-half of the portfolio at year-end 1995 was invested in
U.S. Treasury and Agency
holdings. Although corporate bond
yields were, in general, not particularly attractive relative to
Treasuries and Agencies throughout
most of the year, two bonds
issued by companies with improving prospects Sun Company and
Western National Corporation
were purchased at yields well
over 100 basis points higher than similar maturity Treasuries. The
percentage of investments in
mortgage-backed securities was
allowed to decline during the year. Mortgage-backed securities tend
to underperform during
periods of interest rate volatility due
to the option of the homeowner to refinance when interest rates
decline.
A repeat of the excellent bond market returns earned in 1995 may
prove difficult in 1996. As we
begin the year, however, bond
market participants can look forward to the likelihood that
economic growth will be moderate and
inflation subdued. This could
prove to be a positive environment for bondholders, especially if the
Fed continues to lower
short-term interest rates in an attempt
to maintain reasonable, non-inflationary growth in the U.S.
economy.<PAGE>
AUL American Series Fund, Inc. Bond Portfolio
The graph for the AUL American Series Fund Bond Portfolio
shows the
portfolio's total returns, which include changes in share price and
reinvestment of dividends and capital gains. The graph depicts how
a
$10,000 investment made on the fund's inception date (April 10,
1990)
would have performed through December 31, 1995. The vertical
axis of
the graph is labeled with the cumulative dollar amount (in
thousands), and
the horizontal axis of the graph is labeled with calendar quarter-end
time
periods. The cumulative dollar value of the original $10,000
investment is
plotted for each quarter-end date, and the graph is drawn through
these
points. The cumulative value of a $10,000 investment made on the
inception date of the Bond Portfolio would be $17,086, indicating a
9.8%
return.
Performance numbers are net of all portfolio operating expenses,
but do not
include any separate account or contractual charges. If
performance
information included the effect of these additional charges, it would
be
lower.
The Bond Portfolio is compared against the performance of the
Lehman
Brothers Intermediate Government/Corporate Bond Index, a broad
measure
of the performance of the U.S. bond market. Figures for this index
include
reinvestment of income and capital gains, and are calculated
similarly to the
Bond Portfolio, with a hypothetical $10,000 investment made on
April
10,1990 taken out to December 31,1995. The cumulative value of
this
hypothetical investment made on this date would be $17, 382.
Bond Lehman Brothers
Portfolio Bond Index
One Year 17.8% 19.2%
Five Years 9.4% 9.8%
Since Inception (4/10/90) 9.8% 10.2%
Value of a hypothetical $10,000
investment made 4/10/90 $17,086 $17,382
<PAGE>
The charts show the Bond Portfolio's total returns, which include
changes in share price and
reinvestment of income and capital
gains. Figures for the Lehman Brothers Government/Corporate
Bond Index, an unmanaged index
of government and corporate
bonds, which is a broad measure of the performance of the U.S.
bond market, include
reinvestment of income and capital gains.
The inception figures are from commencement of operations.
Performance numbers for the Bond Portfolio are net of all portfolio
operating expenses, but do
not include separate account or
contract charges. If the performance data included the effect of
these charges, the returns would
be lower. Past performance is no
guarantee of future results. Principal and investment return will vary
so shares may be worth more
or less than their original cost
when redeemed.
<PAGE>
A Message From Kathryn Hudspeth and
Kent Adams, Portfolio Managers of
Managed Portfolio
<PAGE>
The Managed Portfolio utilizes a fully managed investment policy
by allocating assets among
publicly traded common stocks, debt
securities, and money market instruments. Asset allocation
decisions are based on economic
factors and the valuation of each asset
class compared to historic levels.
Investors experienced a dramatic improvement in investment
performance during 1995 compared
to 1994. The U.S. economy
continued its moderate growth, low inflation trend. Labor pressures
remained calm while
consumer spending continued to be
sluggish.
The stock market in 1995 could be characterized as a "two tiered"
market as investors repeatedly
rotated violently between big,
blue chip companies and smaller secondary stocks during the year.
Money poured into the
marketplace as investors eagerly chased
equity returns.
Bond returns were among the highest in history in 1995. Although
long maturity bonds were the
best performers, registering
returns that rivaled those of the major stock indices, even bonds as
short as two years earned
returns in the double digits.
The Managed Portfolio's bond investments in 1995 consisted
primarily of U.S. Treasury and
Agency obligations with maturities
ranging from one to over twenty years. Good quality corporate
bonds and residential
mortgage-backed securities with attractive
yields were also included in the Portfolio.
The Managed Portfolio finished 1995 with an investment return of
19.1% versus 19.2% for the
Lehman Brothers
Government/Corporate Bond Index and 37.5% for the S&P 500.
As the year progressed, the asset allocation of the Managed
Portfolio became slightly more
aggressive as the outlook for the equity
market improved. At year-end 1995, 54% of the Portfolio was
invested in stocks, while 41% was
invested in high quality bonds
and 5% in money market instruments. This can be compared to an
asset allocation of 42% stocks,
52% bonds and 6% cash
equivalents at year-end 1994.
Slow growth with no recession is currently the favored scenario for
1996. The Federal Reserve
lowered short-term interest rates
by twenty-five basis points in December 1995. It is anticipated that
the Fed will provide additional
rate cuts in 1996.
However, it is extremely unlikely that 1996 investment returns will
be a repeat of those
experienced in 1995. Interest rates may
decline, but not as dramatically as in 1995. As a result, bond returns
should be more subdued. The
growth rate in corporate profits
is expected to decline, tempering the enthusiasm from equity
investors. Performance for 1996
could very well "trend back to the
mean."
<PAGE>
AUL American Series Fund, Inc. Managed Portfolio
The graph for the AUL American Series Fund Managed Portfolio
shows
the portfolio's total returns, which include changes in share price
and
reinvestment of dividends and capital gains. The graph depicts how
a
$10,000 investment made on the fund's inception date (April 10,
1990)
would have performed through December 31, 1995. The vertical
axis of
the graph is labeled with the cumulative dollar amount (in
thousands), and
the horizontal axis of the graph is labeled with calendar quarter-end
time
periods. The cumulative dollar value of the original $10,000
investment is
plotted for each quarter-end date, and the graph is drawn through
these
points. The cumulative value of a $10,000 investment made on the
inception date of the Equity Portfolio would be $17,811, indicating
a 10.6%
return.
Performance numbers are net of all portfolio operating expenses,
but do not
include any separate account or contractual charges. If
performance
information included the effect of these additional charges, it would
be
lower.
The Managed Portfolio is compared against the performance of the
S&P
500, an unmanaged index of common stocks, as well as the Lehman
Brothers Intermediate Government/Corporate Bond Index, a broad
measure
of the performance of the U.S. bond market.. Figures for these
indices
include reinvestment of income and capital gains, and are calculated
similarly to the Managed Portfolio, with a hypothetical $10,000
investment
made on April 10,1990 taken out to December 31,1995. The
cumulative
value of this hypothetical investment made on this date would be
$21,313
for the S&P 500 and $17,382 for the Lehman Brothers
Intermediate
Government/Corporate Bond Index.
Managed S&P 500 Lehman Brothers
Portfolio Bond Index
One Year 19.1% 37.5% 19.2%
Five Years 10.9% 16.6% 9.8%
Since Inception (4/10/90) 10.6% 14.2% 10.2%
Value of a hypothetical $10,000
investment made 4/10/90 $17,811 $21,313 $17,382
<PAGE>
The charts show the Managed Portfolio's total returns, which
include changes in share price and
reinvestment of dividends and
capital gains. Figures for the S&P 500, an unmanaged index of
common stocks, include
reinvestment of dividends and capital
gains. S&P 500 is a registered trademark of Standard & Poor's
Corporation. Figures for the
Lehman Brothers
Government/Corporate Bond Index, an unmanaged index of
government and corporate bonds,
which is a broad measure of the
performance of the U.S. bond market, include reinvestment of
income and capital gains. The
inception figures are from
commencement of operations.
Performance numbers for the Managed account are net of all
portfolio operating expenses, but do
not include separate account or
contract charges. If the performance data included the effect of
these charges, it would be lower.
Past performance is no guarantee
of future results. Principal and investment return will vary so shares
may be worth more or less
than their original cost when
redeemed.
<PAGE>
(This page is intentionally blank.)
<PAGE>
Report of Independent Accountants
The Shareholders and Board of Directors
AUL American Series Fund, Inc.
We have audited the accompanying statement of net assets,
including the schedule of investments,
of AUL American
Series Fund, Inc. (comprising, respectively, the Equity, Money
Market, Bond, Managed, and
Tactical Asset Portfolios) as
of December 31, 1995, the related statement of operations for the
year then ended, the statement
of changes in net assets
for each of the two years then ended, and the selected per share
data and ratios for each of the
five years then ended of the
Equity, Money Market, Bond and Managed Portfolios, and the
statement of operations, the
statement of changes in net
assets, and the selected per share data and ratios for the period
from
July 31, 1995 through December 31, 1995 of the Tactical Asset
Portfolio. These financial
statements, per share data and
ratios are the responsibility of the Fund's management. Our
responsibility is to express an opinion
on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those
standards require that we plan
and perform the audit to obtain reasonable assurance about whether
the financial statements are
free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and
disclosures in the
financial statements. Our procedures included confirmation of
investments and cash held by the
custodian as of December
31, 1995, confirmation by correspondence with brokers as to
securities purchased but not
received at that date, or other
auditing procedures where confirmations from brokers were not
received. An audit also includes
assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall
financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements, selected per share data and
ratios referred to above
present fairly, in all material
respects, the financial position of each of the respective portfolios
constituting the AUL American
Series Fund, Inc., as of
December 31, 1995; the results of their operations for the year then
ended, the changes in their
net assets for the each of
two years then ended, and selected per share data and ratios for the
five years then ended of the
Equity, Money Market,
Bond and Managed Portfolios; and the results of operations,
changes in net assets and selected
per share data and ratios
for the period from July 31, 1995 through December 31, 1995 of
the Tactical Asset Portfolio, in
conformity with
generally accepted accounting principles.
Indianapolis, Indiana
January 27, 1996
<PAGE>
(This page is intentionally blank.)
<PAGE>
AUL American Series Fund, Inc.
statement of net assets
December 31, 1995<PAGE>
Portfolio
Equity Money Market Bond Managed Tactical Asset
Assets:
Investments at market value $35,357,455 $23,737,170
$24,961,616 $30,544,844 $1,142,637
(cost: $30,654,061, $23,737,170
$23,296,539, $27,462,076
and $1,098,258, respectively)
Receivable for shares sold, net 0 518,459 241,646
137,837 2
Dividends and interest receivable 62,541 49,610 343,638
228,042 11,509
Prepaid expense 106 106 106
106 327
Deferred organization costs 0 0 0 0
7,340
Total assets 35,420,102 24,305,345 25,547,006
30,910,829 1,161,815
Liabilities:
Distributions payable to AUL 70,725 0 100,803
45,826 6,994
Distributions payable to Dean 0 0 0
0 6,994
Payable for portfolio shares
redeemed, net 26,435 0 0 0 0
Investment advisory fees payable 14,932 9,736 10,682
12,828 0
Accrued expenses 8,485 5,603 6,356
7,573 357
Organization costs payable to AUL 0 0 0 0 8014
Total liabilities 120,577 15,339 117,841 66,227
22,359
Net Assets $35,299,525 $24,290,006 $25,429,165
$30,844,602 $1,139,456
Shares outstanding 2,483,962 24,290,006 2,298,581
2,484,037 109,147
Net Asset Value per share $14.21 $1.00 $11.06 $12.42 $10.44
<PAGE>
The accompanying notes are an integral part of the financial
statements.<PAGE>
AUL American Series Fund, Inc.
statement of operations
For the year ended December 31, 1995
Portfolio
Equity Money Market Bond Managed Tactical Asset(1)
Investment Income:
Income:
Dividends $517,791 $ $ $282,964 $6,239
Interest 286,073 1,126,274 1,645,503
1,013,999 14,254
803,864 1,126,274 1,645,503
1,296,963 20,493
Expenses:
Investment advisory fee 144,456 96,175 117,761
142,020 2,399
Custodian and service agent fee 39,003 25,967 31,795
38,345 585
Professional fees 8,068 9,899 7,391
8,596 83
mortization of deferred
organization costs 769 769 769
769 674
Director fees 1,159 1,159 1,159
1,159 443
Other expenses 8,486 5,823 6,883
8,164 170
201,941 139,792 165,758
199,053 4,354
Net investment income 601,923 986,482 1,479,745
1,097,910 16,139
Gain on Investments:
Net realized gain 398,786 0 263,778
475,564 5,349
Net unrealized gain 4,083,680 0 2,110,855
3,392,949 44,379
Net gain 4,482,466 0 2,374,633
3,868,513 49,728
Net Increase in Net Assets
from Operations $5,084,389 $986,482 $3,854,378 $4,966,423
$ 65,867
(1) for the period from July 31, 1995 through December 31,1995
The accompanying notes are an integral part of the financial statement.
AUL American Series Fund, Inc.
statement of changes in net assets
for the years ended December 31, 1995 and 1994<PAGE>
Portfolio
Equity Money Market
1995 1994 1995 1994
Operations:
Net investment income $601,923 $297,314 $986,482 $361,013
Net realized gain (loss) 398,786 847,029 0 0
Net unrealized gain (loss) 4,083,680 (760,306) 0 0
Increase (Decrease) in Assets
from Operations 5,084,389 384,037 986,482 361,013
Distributions:
From net investment income (599,497) (297,111) (986,482)
(361,013)
From net realized gain (398,786) (847,029)
Decrease (998,283) (1,144,140) (986,482)
(361,013)
Shareholder Transactions:
Proceeds from shares sold 14,809,942 11,014,515
51,157,189 20,034,943
Reinvested distributions 864,872 913,493
986,482 361,013
Cost of shares redeemed (5,024,617) (2,073,178)
(43,349,308) (11,053,614)
Increase 10,650,197 9,854,830 8,794,363
9,342,342
Net increase 14,736,303 9,094,727 8,794,363
9,342,342
Net Assets at beginning of year 20,563,222 11,468,495
15,495,643 6,153,301
Net Assets at end of year $35,299,525 $20,563,222
$24,290,006 $15,495,643
Shares sold 1,118,147 858,805 51,157,189
20,034,943
Reinvested distributions 62,363 74,060 986,482
361,013
Shares redeemed (372,202) (161,347) (43,349,308)
(11,053,614)
Net Increase 808,308 771,518 8,794,363
9,342,342
Shares outstanding at beginning of year 1,675,654 904,136
15,495,643 6,153,301
Shares outstanding at end of year 2,483,962 1,675,654
24,290,006 15,495,643
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
statement of changes in net assets (continued)
for the years ended December 31, 1995 and 1994<PAGE>
Portfolio
Bond Managed
1995 1994 1995 1994
Operations:
Net investment income $1,479,745 $1,102,015 $1,097,910
$744,976
Net realized gain (loss) 263,778 (244,198) 475,564
562,447
Net unrealized gain (loss) 2,110,855 (1,457,895) 3,392,949
(1,470,115)
Increase (Decrease) in Assets
from Operations 3,854,378 (600,078) 4,966,423
(162,692)
Distributions:
From net investment income (1,471,732) (1,098,149) (1,093,207)
(742,652)
From net realized gain (19,580) 0 (475,564) (562,447)
Decrease (1,491,312) (1,098,149) (1,568,771)
(1,305,099)
Shareholder Transactions:
Proceeds from shares sold 10,212,753 8,707,785 9,524,234
13,055,470
Reinvested distributions 938,396 451,272 1,378,654
965,890
Cost of shares redeemed (8,537,765) (1,728,801)
(8,014,116) (2,065,166)
Increase 2,613,384 7,430,256 2,888,772
11,956,194
Net increase 4,976,450 5,732,029 6,286,424
10,488,403
Net Assets at beginning of year 20,452,715 14,720,686
24,558,178 14,069,775
Net Assets at end of year $25,429,165 $20,452,715
$30,844,602 $24,558,178
Shares sold 952,961 829,984 798,921 1,129,652
Reinvested distributions 87,346 44,410 113,420
86,879
Shares redeemed (788,087) (166,393) (661,602)
(180,298)
Net Increase 252,220 708,001 250,739 1,036,233
Shares outstanding at beginning of year 2,046,361 1,338,360
2,233,298 1,197,065
Shares outstanding at end of year 2,298,581 2,046,361
2,484,037 2,233,298
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
statement of changes in net assets (continued)
for the years ended December 31, 1995 and 1994
Portfolio
Tactical Asset (1)
1995
Operations:
Net investment income $ 16,139
Net realized gain (loss) 5,349
Net unrealized gain (loss) 44,379
Increase (Decrease) in Assets
from Operations 65,867
Distributions:
From net investment income (16,384)
From net realized gain (5,349)
Decrease (21,733)
Shareholder Transactions:
Proceeds from shares sold 1,104,684
Reinvested distributions 1,374
Cost of shares redeemed (10,736)
Increase 1,095,322
Net increase 1,139,456
Net Assets at beginning of year 0
Net Assets at end of year $ 1,139,456
Shares sold 110,034
Reinvested distributions 132
Shares redeemed (1,019)
Net Increase 109,147
Shares outstanding at beginning of year
Shares outstanding at end of year 109,147
(1) for the period from July 31, 1995 through December 31,1995
The accompanying notes are an integral part of the financial
statements.
AUL American Series Fund, Inc.
schedule of investments
equity portfolio
December 31, 1995
<PAGE>
Market Market
Description Shares Value Description Shares
Value
Common Stock (87.4%)
Banks & Financial (7.7%)
American Express Co. 19,500 $ 806,813
Banc One Corp. 26,300 992,825
Ohio Casualty Corp. 16,700 647,125
Salomon, Inc. 7,600 269,800
2,716,563
Broadcasting & Publishing (10.2%)
Chris-Craft Industries, Inc.* 18,126 783,949
Deluxe Corp. 21,900 635,100
Gibson Greetings, Inc. 43,200 691,200
Harland (John H.) Co. 19,300 402,888
Meredith Corp. 13,400 561,125
Moore Corp., Ltd. 28,300 527,087
3,601,349
Chemicals (1.5%)
Carlisle Companies, Inc. 5,000 201,875
Quaker Chemical Corp. 24,800 334,800
536,675
Electrical Equipment &
Electronics (5.8%)
Baldor Electric Co. 29,610 595,901
Dynatech Corp.* 62,000 1,054,000
General Electric Co. 5,600 403,200
2,053,101
Entertainment & Leisure (4.3%)
CPI Corp. 48,800 780,800
Fleetwood Enterprises, Inc. 25,200 648,900
Huffy Corp. 10,600 107,325
1,537,025
Furniture and Apparel (12.5%)
Blair Corp. 4,400 138,600
Hillenbrand Industries, Inc. 23,100 782,513
Kellwood Co. 26,700 544,012
La Z Boy Chair Co. 21,400 660,725
Liz Claiborne, Inc. 39,300 1,090,575
Oshkosh B'Gosh, Inc. 34,100 596,750
Class A
Reebok International 21,000 593,250
4,406,425
Health Care (5.2%)
Acuson Corp. 27,700 342,788
Community Psychiatric 9,800 120,050
Centers, Inc.
Health Care (5.2%) continued
Guidant Corp. 5,983 $ 252,782
Lilly (Eli) & Co. 6,770 380,812
Merck & Co. 11,500 756,125
1,852,557
Information Processing &
Telecommunications (9.4%)
Apple Computer, Inc. 20,200 643,875
Cray Research, Inc.* 7,200 178,200
Hunt Manufacturing Co. 9,900 172,013
International Business 7,100 651,425
Machines Corp.
Software Publishing Corp.* 14,900 49,356
Sun Microsystems, Inc.* 28,200 1,286,625
Telxon Corp. 15,600 352,950
3,334,444
Machinery (2.6%)
Lawson Products, Inc. 21,300 521,850
Precision Castparts Corp. 10,300 409,425
931,275
Merchandising (5.4%)
Longs Drug Stores Corp. 19,000 909,625
Mac Frugal's Bargains 36,500 511,000
Close-outs, Inc.
Merchantile Stores Co. 10,900 504,125
1,924,750
Metals & Mining (2.3%)
Aluminum Company of 8,200 433,575
America
Oregon Steel Mills, Inc. 26,000 364,000
797,575
Oil & Oil Services (3.4%)
Royal Dutch Petroleum Co. 3,400 479,825
Valero Energy Crop. 29,300 717,850
1,197,675
Paper Products & Containers (1.6%)
Sealright, Inc. 32,500 361,562
Zero Corp. 10,900 193,475
555,037
Transportation (3.4%)
Alexander & Baldwin, Inc. 29,100 669,300
Norfolk Southern Corp. 6,500 515,938
1,185,238
*does not pay cash dividends
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
schedule of investments
equity portfolio (continued)
December 31, 1995<PAGE>
Market
Description Shares Value
Common Stock (87.4%), continued
Miscellaneous (12.1%)
Boeing Co. 8,800 $ 689,700
Cross (A.T.) Co. Class A 23,700 358,462
Ford Motor Co. 23,500 681,500
Groundwater Technology, Inc.* 42,400 593,600
Kelly Services, Inc. 27,000 749,250
Michael Foods, Inc. 46,100 535,913
Seagram Company, Ltd. 4,600 159,275
Stanhome, Inc. 17,800 518,425
4,286,125
Total common stock (cost: $26,212,420)
30,915,814
Money Market Mutual Funds (3.6%)
Merrill Lynch Institutional Fund 559,453 559,453
Dreyfus U.S. Treasury Prime 712,661 712,661
Total mutual funds (cost: $1,272,114)
1,272,114
Interest Maturity Principal
Rate Date Amount
Short-term Notes (9.0%)
General Electric Capital Corporation 5.800% 1/16/96
1,000,000 990,095
Associates Corporation of North America 5.700% 1/26/96
1,000,000
990,500
Ford Motor Credit Corporation 5.620% 1/30/96
600,000 594,380
American General Finance Corp. 5.660% 2/23/96
600,000 594,552
Total short-term notes (cost: $3,169,527)
3,169,527
Total Investments (cost: $30,654,061) $
35,357,455
*does not pay cash dividends
The accompanying notes are an integral part of the financial
statements.<PAGE>
AUL American Series Fund, Inc.
statement of investments
money market portfolio
December 31, 1995<PAGE>
Interest Maturity Principal Market
Description Rate Date Amount Value
Short-term Notes (55.0%)
U.S. Government & Agency Obligations (55.0%)
Federal Home Loan Bank Notes 5.570% 1/10/96 $
3,500,000 $ 3,494,043
Federal Home Loan Bank Notes 5.550% 1/25/96
2,000,000 1,991,984
Federal Home Loan Bank Notes 5.540% 2/01/96
6,000,000 5,969,530
Federal Home Loan Bank Notes* 5.400% 2/12/96
1,600,000 1,589,440
Total short-term notes (cost: $13,044,997)
13,044,997
Corporate Obligations (41.6%)
Automotive (4.2%)
Ford Motor Credit Corporation 5.760% 1/05/96
1,000,000 1,000,000
Electrical Equipment (8.4%)
General Electric Company 5.690% 1/05/96
1,000,000 1,000,000
General Electric Capital Corporation 5.706% 1/12/96
1,000,000 1,000,000
Financial (16.4%)
American General Finance Corporation 5.690% 1/08/96
900,000 900,000
General Electric Capital Services Corporation 5.760% 1/11/96
1,000,000 1,000,000
Prudential Funding Corporation 5.750% 1/12/96
1,000,000 1,000,000
Norwest Financial Corporation 5.750% 1/19/96
1,000,000 1,000,000
Machinery (4.2%)
John Deere Capital Corporation 5.760% 1/11/96
1,000,000 1,000,000
Oil and Gas (4.2%)
Chevron Oil Finance Company 5.760% 1/25/96
1,000,000 1,000,000
Real Estate and Leasing (4.2%)
Associates Corporation of North America 5.750% 1/26/96
1,000,000 1,000,000
Total corporate obligations (cost: $9,900,000)
9,900,000
Certificates of Deposit (1.7%)
Fifth Third Bank of Indiana 5.350% 1/05/96
400,000 400,000
Total certificates of deposit (cost: $400,000)
400,000
Shares
Money Market Mutual Funds(1.7%)
Dreyfus U.S. Treasury Prime
392,173 392,173
Total money market mutual funds (cost: $392,173)
392,173
Total Investments (cost: $23,737,170)
$23,737,170
*variable rate note<PAGE>
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
schedule of investments
bond portfolio
December 31, 1995<PAGE>
Interest Maturity Principal Market
Description Rate Date Amount Value
Notes and Bonds (97.6%)
U.S. Government & Agency Obligations (62.1%)
Federal Home Loan Bank Notes 5.040% 8/20/98 $
750,000 $ 743,400
U.S. Treasury Notes 8.875% 2/15/99
2,900,000 3,195,945
Federal National Mortgage Association Notes 6.200%
7/17/00 1,300,000
1,309,542
U.S. Treasury Notes 8.000% 5/15/01
3,350,000 3,750,560
U.S. Treasury Notes 7.500% 5/15/02
650,000 720,791
U.S. Treasury Strips 2/15/07
1,300,000 686,894
Federal National Mortgage Association CMO 6.500%
5/25/08 800,000 805,296
Federal National Mortgage Association CMO 7.500%
12/25/09 600,000 632,460
U.S. Treasury Bonds 8.750% 5/15/17
2,750,000 3,635,803
15,480,691
Corporate Obligations (35.5%)
Associates Corporation of North America Notes 8.750%
4/04/96 550,000 554,180
General Motors Acceptance Corporation Notes 7.700%
1/24/97 1,000,000 1,022,500
Allstate Corporation Notes 5.875% 6/15/98
625,000 626,562
El Paso Natural Gas Company Notes 7.750% 1/15/02
200,000 217,250
Western National Corp. Notes 7.125% 2/15/04
800,000 822,000
Eli Lilly & Company Notes 8.375% 12/01/06
850,000 1,007,250
Prudential-Bache Trust CMO 12D 5.350% 10/20/09
1,700,000 1,683,034
American Southwest Financial Corporation CMO 8.900%
3/01/18 200,073 211,972
Merrill Lynch CMO Trust XXXVIID 8.150% 11/01/18
720,000 763,207
Fleet Mortgage Securities, Inc. CMO 7.950% 6/01/19
750,000 779,850
Hydro-Quebec Debenture Bonds 8.050% 7/07/24
400,000 457,500
Sun, Inc., Debenture Bonds 9.000% 11/01/24
600,000 728,250
Total notes and bonds (cost: $22,689,169)
24,354,246
Shares
Money Market Mutual Funds (2.4%)
Dreyfus U.S. Treasury Prime 554,367 554,367
Merrill Lynch Institutional Fund 53,003 53,003
Total mutual funds (cost: $607,370) 607,370
Total Investments (cost: $23,296,539 $24,961,616
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
schedule of investments
managed portfolio
December 31, 1995<PAGE>
Market
Description Shares Value Description Shares
Value
Common Stock (54.5%)
Banks & Financial (4.7%)
American Express Co. 10,700 $ 442,713
Banc One Corp. 13,900 348,750
Ohio Casualty Corp. 9,000 145,550
Salomon, Inc. 4,100 524,725
1,461,738
Broadcasting & Publishing (6.5%)
Chris-Craft Industries, Inc.* 9,794 423,590
Deluxe Corp. 12,200 353,800
Gibson Greetings, Inc. 22,900 366,400
Harland (John H.) Co. 11,200 233,800
Meredith Corp. 7,000 293,125
Moore Corp., Ltd. 15,200 283,100
1,953,815
Chemicals (1.0%)
Carlisle Companies, Inc. 3,100 125,163
Quaker Chemical Corp. 14,000 189,000
314,163
Electrical Equipment &
Electronics (3.6%)
Baldor Electric Co. 14,850 298,856
Dynatech Corp.* 33,500 569,500
General Electric Co. 3,200 230,400
1,098,756
Entertainment & Leisure (2.7%)
CPI Corp. 26,000 416,000
Fleetwood Enterprises 13,400 345,050
Huffy Corp. 6,100 61,763
822,813
Furniture and Apparel (7.7%)
Blair Corp. 2,800 88,200
Hillenbrand Industries, Inc. 12,100 409,887
Kellwood Co. 14,600 297,475
La Z Boy Chair Co. 11,500 355,063
Liz Claiborne, Inc. 20,700 574,425
Oshkosh B'Gosh, Inc. 17,300 302,750
Class A
Reebok International 11,300 319,225
2,347,025
Health Care (3.2%)
Acuson Corp. 14,800 183,150
Community Psychiatric 6,900 84,525
Centers, Inc.
Guidant Corp. 3,050 128,863
Health Care (3.2%), continued
Lilly (Eli) & Co. 3,452 $ 194,175
Merck & Co. 5,900 387,925
978,638
Information Processing &
Telecommunications (5.9%)
Apple Computer, Inc. 11,100 353,812
Cray Research, Inc.* 3,000 74,250
Hunt Manufacturing Co. 4,700 81,663
International Business 3,900 357,825
Machines Corp.
Software Publishing Corp.* 11,500 38,094
Sun Microsystems, Inc.* 15,800 720,875
Telxon Corp. 7,900 178,737
1,805,256
Machinery (1.6%)
Lawson Products, Inc. 11,600 284,200
Precision Castparts Corp. 5,100 202,725
486,925
Merchandising (3.4%)
Longs Drug Stores Corp. 10,100 483,538
Mac Frugal's Bargains 19,700 275,800
Close-outs, Inc.
Mercantile Stores Co. 5,900 272,875
1,032,213
Metals & Mining (1.5%)
Aluminum Company of 4,700 248,512
America
Oregon Steel Mills, Inc. 14,500 203,000
451,512
Oil & Oil Services (2.1%)
Royal Dutch Petroleum Co. 1,900 268,137
Valero Energy Crop. 15,800 387,100
655,237
Paper Products & Containers (1.2%)
Sealright, Inc. 19,600 218,050
Zero Corp. 8,800 156,200
374,250
Transportation (2.0%)
Alexander & Baldwin, Inc. 15,400 354,200
Norfolk Southern Corp. 3,100 246,063
600,263
*does not pay cash dividends
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
schedule of investments
managed portfolio (continued)
December 31, 1995<PAGE>
Market
Description Shares Value
Common Stock (54.5%), continued
Miscellaneous (7.4%)
Boeing Co. 4,600 $360,525
Cross (A.T.) Co. Class A 12,300 186,037
Fort Motor Co. 12,500 362,500
Groundwater Technology, Inc.* 23,100 323,400
Kelly Services, Inc. 14,800 410,700
Michael Foods, Inc. 24,700 287,138
Seagram Company, Ltd. 2,200 76,175
Stanhome, Inc. 9,100 265,037
2,271,512
Total common stock (cost: $14,406,565)
16,654,116
Money Market Mutual Funds (4.9%)
Dreyfus U.S. Treasury Prime
917,445 917,445
Merrill Lynch Institutional Fund
571,627 571,627
Total money market mutual funds (cost: $1,489,072)
1,489,072
Interest Maturity Principal
Rate Date Amount
Notes and Bonds (40.6%)
U.S. Government and Agency Obligations (30.0%)
Federal Home Loan Bank Notes 8.250% 9/25/96 $
500,000 510,070
Federal Home Loan Bank Notes 5.040% 8/20/98
250,000 247,800
U.S. Treasury Notes 8.875% 2/15/99
2,300,000 2,534,715
Federal Home Loan Banks Bonds 8.600% 6/25/99
500,000 547,650
Federal National Mortgage Association Bonds 8.350%
11/10/99 500,000 548,475
Federal National Mortgage Association Bonds 6.200% 7/17/00
400,000 402,936
U.S. Treasury Notes 8.000% 2/15/01
1,425,000 1,595,387
U.S. Treasury Strips 2/15/07 700,000
369,866
Federal National Mortgage Association CMO 6.500% 5/25/08
500,000 503,310
U.S. Treasury Bonds 8.750% 5/15/17
1,450,000 1,917,060
9,177,269
Corporate Obligations (10.6%)
Associates Corporation of North America 8.750% 4/04/96
125,000 125,950
General Motors Acceptance Corporation Notes 7.700%
1/24/97 800,000 818,000
Allstate Corporation Notes 5.875% 6/15/98
250,000 250,625
El Paso Natural Gas Company Notes 7.750% 1/15/02
100,000 108,625
Western National Corp. Notes 7.125% 2/15/04
600,000 616,500
Eli Lilly & Company Notes 8.375% 12/01/06
450,000 533,250
Hydro-Quebec Debenture Bonds 8.050% 7/07/24
250,000 285,937
Sun, Inc. Debenture Bonds 9.000% 11/1/24
400,000 485,500
Total notes and bonds (cost: $11,566,439)
12,401,656
Total Investments (cost: $27,462,076) $
30,544,844
*does not pay cash dividends
The accompanying notes are an integral part of the financial
statements.
<PAGE>
AUL American Series Fund, Inc.
schedule of investments
tactical asset portfolio
December 31, 1995<PAGE>
Market Market
Description Shares Value Description Shares
Value
Common Stock (47.3%)
Automotive & Truck (4.9%)
Chrysler Corp. 100 $ 5,538
Ford Motor Co. 700 20,300
PACCAR, Inc. 400 16,850
TBC Corp. 1,500 12,937
55,625
Bank & Financial (10.0%)
AFLAC, Inc. 400 17,350
AMBAC, Inc. 400 18,750
Federal Home Loan
Mortgage Corp. 200 16,700
Federal National Mortgage
Association 100 12,413
Integon Corp. 1,000 20,625
John Alden Financial Corp. 200 4,175
Lehman Brothers Holding, Inc. 500 10,625
PMI Group, Inc. 300 13,575
114,213
Chemicals (3.7%)
Dow Chemical Co. 200 14,075
Eastman Chemical Co. 300 18,787
Georgia Gulf Corp. 300 9,225
42,087
Entertainment & Leisure (1.8%)
Fleetwood Enterprises, Inc. 800 20,600
20,600
Furniture and Apparel (1.4%)
VF Corp. 300 15,825
15,825
Health Care (3.5%)
Humana, Inc. 800 21,900
U.S. Healthcare, Inc. 400 18,600
40,500
Information Processing &
Telecommunications (4.1%)
American Power 1,000 $ 9,500
EMC Corp. 800 12,300
Seagate Technology, Inc. 200 9,500
Sprint Corp. 400 15,950
47,250
Merchandising (4.0%)
May Department Store, Inc. 400 16,900
TJX Companies, Inc. 1,000 18,875
Value City Department Store 1,500 10,125
45,900
Metals & Mining (0.9%)
Birmingham Steel Corp. 700 10,413
10,413
Oil & Oil Services (3.6%)
Ashland, Inc. 400 14,050
Southwestern Energy, Inc. 1,000 12,750
Valero Energy Corp. 600 14,700
41,500
Paper & Containers (3.3%)
International Paper Co. 600 22,725
Louisiana-Pacific Corp. 600 14,550
37,275
Transportation (0.8%)
Arnold Industries, Inc. 500 8,687
8,687
Miscellaneous (5.3%)
Philip Morris Cos., Inc. 200 18,100
Teleflex, Inc. 300 12,300
UST, Inc. 900 30,038
60,438
*does not pay cash dividends<PAGE>
The accompanying notes are an integral part of the financial statements.
AUL American Series Fund, Inc.
schedule of investments
tactical asset portfolio (continued)
December 31, 1995<PAGE>
Market
Description Shares Value
Total common stock (cost: $505,590)
$ 540,313
Money Market Mutual Funds (8.6%)
Dreyfus U.S. Treasury Prime
98,118 98,118
Total mutual funds (cost: $98,118)
98,118
Interest Maturity Principal
Rate Date Amount
Notes and Bonds (44.1%)
U.S. Treasury Note 6.125% 7/31/96
100,000 100,498
U.S. Treasury Note 5.500% 7/31/97
100,000 100,504
U.S. Treasury Note 5.250% 7/31/98
100,000 100,043
U.S. Treasury Note 6.000% 10/15/99
100,000 102,362
U.S. Treasury Note 5.500% 4/15/00
100,000 100,799
Total notes and bonds (cost: $494,550)
504,206
Total Investments (cost: $1,098,258) $
1,142,637
<PAGE>
The accompanying notes are an integral part of the financial statements.
(This page is intentionally blank.)
notes to financial statements
1. Summary of Significant Accounting Policies
The AUL American Series Fund, Inc. (Fund) was incorporated
under the laws of Maryland on
July 26, 1989, and is
registered under the Investment Company Act of 1940, as
amended, as an open-end, diversified
management investment
company. As a "series" type of mutual fund, the Fund issues shares
of common stock relating to
separate investment portfolios
consisting of the Equity Portfolio, Money Market Portfolio, Bond
Portfolio, Managed Portfolio,
and Tactical Asset Allocation
Portfolio (Tactical Asset). Currently, the Fund offers shares only to
separate accounts of
American United Life Insurance
Company (AUL) to serve as an underlying investment vehicle for
variable annuity contracts. The
Fund commenced
operations on April 10, 1990.
Investments
Securities traded on a national securities exchange are valued at the
last trade price. Listed
securities for which no sale was
reported on the valuation date are valued at the latest bid price.
Short-term notes are valued at
amortized cost which
approximates market value. Fixed income securities for which
representative market quotes are
readily available are valued at
the latest bid price as quoted by one or more dealers who make a
market in such securities. U.S.
Government obligations are
valued at the latest bid price; however, such obligations maturing in
60 days or less are valued at
amortized cost which
approximates market value.
The Money Market Portfolio securities are valued at amortized
cost. The Fund's use of the
amortized cost method is
conditioned on its compliance with certain provisions of Rule 2a-7
of the Investment Company
Act of 1940. The Investment
Manager reviews this method of valuation to ensure that the
portfolio securities are reflected at
their fair value.
Security transactions are recorded on the trade date. Realized gains
and losses are determined on
specific identification basis.
Income and Expense
Dividend income is recorded on the ex-dividend date, and interest
income is accrued daily.
Portfolio expenses are recorded on
an accrual basis.
Deferred Organization Costs
Expenses incurred by the Fund in connection with its organization
have been capitalized and are
amortized over five years on a
straight-line basis.
Taxes
The fund qualifies as a regulated investment company under the
Internal Revenue Code; thus, no
tax provision is required. The Fund's policy is to
distribute all income to shareholders.
Dividend and Capital Gain Distributions
For the Money Market Portfolio, dividends from net investment
income are declared and paid
daily. For all other portfolios,
dividends from net investment income are declared and paid
quarterly. Distributions from net
realized gains on investments are
declared and paid at least annually for all portfolios.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting
principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities at the
date of the financial statements
and the reported amounts of revenues and expenses during the
reporting period. Actual results
could differ from those
estimates.
2. Transactions with AUL
AUL invested $23,000,000 to established the Fund. AUL's
investment in the Fund is:
Equity Portfolio $ 3,091,634
Bond Portfolio 5,792,572
Managed Portfolio 1,507,985
Tactical Asset Portfolio 500,000
$ 10,892,191
The Fund has an investment advisory agreement with AUL
to act as its investment
advisor. For its services, AUL receives a
fee at an annual rate of .50% of the Portfolio's average daily net
assets. AUL has also agreed that
its fee may be reduced if the
aggregate ordinary operating expenses of the Portfolios exceed 1%
of the average daily net assets
during the year. To the
extent that AUL has reduced its advisory fees to prevent the
Portfolio's aggregate ordinary
operating expenses from exceeding
1%, it may increase its advisory fee during any of the next
succeeding 5 years, provided that the
aggregate ordinary operating
expenses in any given year do not exceed 1% of the average daily
net assets in that year. The total
amount of any increase in
AUL's fees will not exceed the prior fee reduction.
notes to financial statements (continued)
<PAGE>
2. Transactions with AUL, continued:
AUL may terminate the policy of reducing its fee and/or assuming
Fund expenses upon 30 days
prior written notice to
the Fund, and in any event, the policy will automatically terminate
if the Investment Advisory
Agreement is terminated. The
investment advisory fees incurred during the year ended
December 31, 1995, and 1994, were
$502,811 and $319,962,
respectively.
Certain directors of the Fund are officers of AUL.
3. Agreements with Banks
The Fund has agreements with The Provident Bank (Bank)
whereby the Bank serves as
custodian of the securities and
other assets of the Fund, and as bookkeeping, transfer and
disbursing agent for the Fund.
4. Investment Transactions
Purchases and sales of investment securities (excluding short-term
securities and money market
mutual funds) during the
year ended December 31, 1995, were:
Portfolio
Equity Money Market Bond Managed
Tactical Asset
Common Stock:
Purchases $11,744,350 $ $ $
6,180,678 $ 537,970
Proceeds from sales 2,316,251 0 0
2,109,943 37,730
Corporate Bonds:
Purchases 0 0 1,717,960
1,188,454 0
Proceeds from sales 0 0 834,125
47,411 0
Government Bonds:
Purchases 0 0 13,111,649
3,909,608 494,063
Proceeds from sales 0 0 11,449,933
6,957,773 0
5. Authorized Capital Shares
The Fund has 125,000,000 authorized shares of $.001 par value
capital stock, which includes
10,000,000 unallocated
shares. The remaining shares are allocated to each of the Fund's
portfolios as follows:
Equity Portfolio 10,000,000
Money Market Portfolio 50,000,000
Bond Portfolio 10,000,000
Managed Portfolio 20,000,000
Tactical Asset 25,000,000
115,000,000
6. Net Assets
Portfolio
Equity Money Market Bond Managed
Tactical Asset
Proceeds from shares sold
and reinvested distributions $39,352,977 $79,854,859
$34,405,561 $38,808,962 $1,106,057
Cost of shares redeemed (8,759,475) (55,564,853)
(10,653,352) (11,054,156) (10,736)
Undistributed net investment
income 2,629 0 11,879
7,028 (244)
Undistributed net realized
gain (loss)
Unrealized gain (loss) 4,703,394 0 1,665,077
3,082,768 44,379
$35,299,525 $24,290,006 $25,429,165
$30,844,602 $1,139,456
notes to financial statements (continued)
<PAGE>
7. Selected Per Share Data and Ratios
The per share amounts are based on shares outstanding
throughout the years.
Equity Portfolio
1995 1994 1993 1992 1991
Investment Income $0.37 $0.33 $0.28
$0.32 $0.40
Expense 0.09 0.09 0.10
0.09 0.09
Net investment income 0.28 0.24 0.18
0.23 0.31
Net gain (loss) on investments 2.12 0.26 1.58
0.92 2.23
Shareholder distributions:
Net investment income (0.27) (0.24) (0.18)
(0.23) (0.31)
Realized gain (0.19) (0.67) (0.39)
(0.32) (0.92)
Net increase (decrease) 1.94 (0.41) 1.19
0.60 1.31
Net asset value at
beginning of year 12.27 12.68 11.49
10.89 9.58
Net asset value at end of year $14.21 $12.27 $12.68
$ 11.49 $10.89
Ratio to average net assets:
Expense 0.70% 0.73% 0.82% 0.84%
0.80%
Net investment income 2.08% 1.85% 1.46% 2.04%
2.75%
Total return 19.45% 2.64% 14.80% 10.03%
25.58%
Portfolio turnover rate 10% 20% 10%
15% 43%
Shares outstanding 2,483,962 1,675,654 904,136
606,686 379,027
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Money Market Portfolio
1995 1994 1993 1992 1991
Investment Income $0.06 $0.05 $ 0.03
$ 0.04 $ 0.06
Expense 0.01 0.01 0.01
0.01 0.01
Net investment income 0.05 0.04 0.02
0.03 0.05
Net gain (loss) on investments
Shareholder distributions:
Net investment income (0.05) (0.04) (0.02)
(0.03) (0.05)
Realized gain
Net increase
Net asset value at
beginning of year 1.00 1.00 1.00
1.00 1.00
Net asset value at end of year $1.00 $1.00 $1.00
$1.00 $1.00
Ratio to average net assets:
Expense 0.73% 0.75% 0.84%
0.85% 0.85%
Net investment income 5.13% 3.71% 2.30%
2.98% 5.35%
Total return 5.09% 3.38% 2.33%
3.01% 5.53%
Portfolio turnover rate
Shares outstanding 24,290,006 15,495,643 6,153,301
5,480,206 5,149,563
notes to financial statements (continued)
<PAGE>
7. Selected Per Share Data and Ratios, continued
Bond Portfolio
1995 1994 1993 1992 1991
Investment Income $0.75 $ 0.72 $ 0.75
$ 0.79 $ 0.87
Expense 0.08 0.08 0.09
0.09 0.08
Net investment income 0.67 0.64 0.66
0.70 0.79
Net gain (loss) on investments 1.07 (1.01) 0.49
0.06 0.85
Shareholder distributions:
Net investment income (0.66) (0.64) (0.66)
(0.70) (0.79)
Realized gain (0.01) (0.14) (0.31)
(0.27)
Net increase (decrease) 1.07 (1.01) 0.35
(0.25) 0.58
Net asset value at
beginning of year 9.99 11.00 10.65
10.90 10.32
Net asset value at end of year $11.06 $ 9.99 $11.00
$10.65 $10.90
Ratio to average net assets:
Expense 0.70% 0.73% 0.80% 0.79%
0.71%
Net investment income 6.28% 6.19% 5.95% 6.47%
7.46%
Total return 17.79% (3.56%) 10.69% 7.19%
16.36%
Portfolio turnover rate 55% 50% 29% 41%
61%
Shares outstanding 2,298,581 2,046,361 1,338,361 1,123,783
1,078,041
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Managed Portfolio
1995 1994 1993 1992 1991
Investment Income $0.54 $0.50 $0.49
$ 0.58 $ 0.71
Expense 0.08 0.08 0.09
0.09 0.10
Net investment income 0.46 0.42 0.40
0.49 0.61
Net gain (loss) on investments 1.62 (0.45) 1.07
0.41 1.06
Shareholder distributions:
Net investment income (0.46) (0.42) (0.40)
(0.49) (0.61)
Realized gain (0.20) (0.30) (0.24)
(0.35) (0.31)
Net increase (decrease) 1.42 (0.75) 0.83
0.06 0.75
Net asset value at
beginning of year 11.00 11.75 10.92
10.86 0.11
Net asset value at end of year $12.42 $ 11.00 $ 11.75
$ 10.92 $10.86
Ratio to average net assets:
Expense 0.70% 0.73% 0.81% 0.82%
0.94%
Net investment income 3.86% 3.63% 3.49% 4.46%
5.74%
Total return 19.13% (0.92%) 12.98% 7.95%
16.73%
Portfolio turnover rate 35% 34% 9% 33%
36%
Shares outstanding 2,484,037 2,233,298 1,197,065
760,101 569,323
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Tactical Asset
1995
Investment Income $ 0.20
Expense 0.04
Net investment income 0.16
Net gain (loss) on investments 0.49
Shareholder distributions:
Net investment income (0.16)
Realized gain (0.05)
Net increase (decrease) 0.44
Net asset value at
beginning of year 10.00
Net asset value at end of year $10.44
Ratio to average net assets(1):
Expense 1.00%
Net investment income 3.70%
Total return(1) 6.49%
Portfolio turnover rate 4%
Shares outstanding 109,147
<PAGE>
(1) Ratios calculated for period July 31, 1995 through December
31, 1955 on annualized basis
notes to financial statements (continued)<PAGE>
8. Unrealized Gain (Loss)
Portfolio
Equity Money Market Bond Managed
Tactical Asset
Common Stock:
Appreciation $5,957,649 $ $ $3,020,289
$ 51,555
Depreciation (1,254,255) (772,738)
(16,832)
Notes and Bonds:
Appreciation 1,666,068 835,613
9,656
Depreciation (991) (396)
$ 4,703,394 $ $1,665,077 $
3,082,768 $ 44,379
6. Net Shareholders
Portfolio
Equity Money Market Bond Managed
Tactical Asset
AUL 309,609 0 578,768 150,952
50,001
Dean Investments
50,000
AUL American Unit Trust 1,181,632 2,457,397 522,681
1,239,217
AUL Group Retirement Annuity
Separate Account II 922,123 20,180,783
1,153,520 1,037,056
AUL American Individual
Unit Trust 70,598 1,651,826 43,612
56,812 9,146
2,483,962 24,290,006 2,298,581
2,484,037 109,147
<PAGE>
American United Life Insurance Company
P.O. Box 368
Indianapolis, Indiana 46206-0368
SA-12757K
