AUL American Series Fund, Inc.
Semi-Annual Report
June 30, 1996<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
U.S. economic growth was stronger than expected during the first half of 1996.
We experienced an increase in new home sales, strong employment gains, falling
commodity prices, and continued moderate inflation.
Investment markets reacted in a mixed fashion to these events. Bond investors,
concerned that higher growth would ultimately create inflationary pressures,
pushed ten year bond yields up over 100 basis points. Higher interest rates
translated into declining bond prices and negative returns for portfolios
invested primarily in intermediate and longer maturity bonds.
The stock market, on the other hand, started off the year on a strong note,
continuing the remarkable advance which began during 1995. However, during
February, indications of faster than expected economic growth became unsettling
to equity investors who were undecided whether this increased growth would be
positive or negative for stocks. A strengthening economy suggests sustainable
profit growth. Yet higher interest rates could choke off business expansion,
thereby hindering future profits. As a result, the stock market remained in a
volatile trading range, as investors rotated rapidly from one investment theme
to another.
Investment performance for the AUL American Series Fund, Inc. for the first
half of 1996 was:
Equity Portfolio 8.4%
Money Market Portfolio 2.3%
Bond Portfolio -2.3%
Managed Portfolio 4.0%
Tactical Asset Allocation Portfolio 4.6%
As we begin the second half of 1996, we are experiencing continued evidence of
economic strength. All eyes are focused on the Federal Reserve Board to see if
it feels compelled to move into a more restrictive policy stance to prevent
inflationary pressures. During July, Federal Reserve Chairman Alan Greenspan
announced that he expects the economy to moderate in the months ahead without
any intervention from the Federal Reserve. Moderating economic growth would
be positive for bond investors. Without inflationary fears, interest rates
could decline, causing bonds to appreciate.
In this extended bull market, equity investors are preoccupied with second
quarter earnings announcements and the possibility of higher interest rates,
causing extreme trading volatility from day to day. Stocks should continue to
benefit from the favorable supply/demand situation and the fact that the June
through December period is typically strong for stocks during Presidential
election years. However, with earnings momentum slowing and the direction of
interest rates still uncertain, equity investing should remain challenging
during the remainder of 1996.
The performance for the AUL American Series Fund, Inc. is net of all portfolio
expenses but does not reflect separate account or annuity contract charges.
James W. Murphy
Chairman of the Board of Directors and President
Indianapolis, Indiana
July 15, 1996
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. Leslie Lenkowsky, Director
Professor, School of Business Director, Hudson Institute
Indiana University, Indianapolis, Indiana Indianapolis, Indiana
Leonard D. Schutt, Director Richard A. Wacker, Secretary
<PAGE>
(This page is intentionally blank.) AUL American Series Fund, Inc.
statement of net assets
June 30, 1996
(unaudited)
Portfolio
Equity Money Market Bond Managed Tactical Asset
Assets:
Investments at market value $ 42,669,044 $ 32,706,773 $
26,785,757 $ 35,629,193 $ 1,789,773
(cost: $35,308,714, $32,706,773
$26,609,212, $32,051,056
and $1,721,273 respectively)
Receivable for shares sold, net 622,504
29,224 24,250 3,029
Receivable for investments sold 9,572
4,798 6,750
Dividends and interest receivable 47,014 38,763
373,466 261,464 9,422
Prepaid expense 374 374 374
374 374
Deferred organization costs
6,582
Total assets 42,726,004 33,368,414 27,188,821
35,920,079 1,815,930
Liabilities:
Distributions payable to AUL 20,988
46,650 7,898 3,164
Distributions payable to Dean
3,164
Payable for portfolio shares
redeemed, net 14,315
Payable for investments purchased
43,076
Investment advisory fees payable 17,534 13,098
11,219 14,907 156
Accrued expenses 13,187 7,526 8,836
11,880 454
Organization costs payable to AUL
8,051
Total liabilities 66,024 20,624 66,705
34,685 58,065
Net Assets $ 42,659,980 $ 33,347,790 $ 27,122,116
$35,885,394 $ 1,757,865
Shares outstanding 2,793,884 33,347,790 2,583,234
2,826,744 162,816
Net Asset Value per share $ 15.27 $ 1.00 $ 10.50
$ 12.70 $ 10.80
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
statement of operations
For the six months ended June 30, 1996
(unaudited)
Portfolio
Equity Money Market Bond Managed Tactical Asset
Investment Income:
Income:
Dividends $ 337,552 $ $
$ 185,017 $ 6,941
Interest 147,881 790,491 877,359
509,549 19,413
485,433 790,491
877,359 694,566 26,354
Expenses:
Investment advisory fee 96,929 73,583 66,637
84,543 4,624
Custodian and service agent fee 26,171 19,868
17,992 22,826 945
Professional fees 3,488 2,639 2,409
3,044 158
Amortization of deferred
organization costs
795
Director fees 2,401 1,762 1,646
2,086 86
Other expenses 7,363 3,385 5,421
6,652 448
136,352 101,237 94,105
119,151 7,056
Net investment income 349,081 689,254 783,254
575,415 19,298
Gain on Investments:
Net realized gain 89,158 74,491
241,384 9,417
Net unrealized gain (loss) 2,656,936 (1,488,532)
495,368 24,121
Net gain (loss) 2,746,094 (1,414,041)
736,752 33,538
Net Increase (Decrease) in
Net Assets from Operations $ 3,095,175 $ 689,254
$ (630,787) $ 1,312,167 $ 52,836
The accompanying notes are an integral part of the financial statement.<PAGE>
AUL American Series Fund, Inc.
statement of changes in net assets
for the six months ended June 30, 1996 and 1995
(unaudited)
Portfolio
Equity Money Market
1996 1995 1996 1995
Operations:
Net investment income $ 349,081 $ 281,985 $ 689,254 $
474,998
Net realized gain 89,158 191,789
Net unrealized gain (loss) 2,656,936 2,256,233
Increase (Decrease) in Assets
from Operations 3,095,175 2,730,007
689,254
474,998
Distributions:
From net investment income (354,439) (277,587) (689,254)
(474,998)
From net realized gain
Decrease (354,439) (277,587) (689,254)
(474,998)
Shareholder Transactions:
Proceeds from shares sold 7,478,373 8,169,723 51,889,887
24,796,600
Reinvested distributions 313,769 236,094 689,254
474,998
Cost of shares redeemed (3,172,423) (2,009,054)
(43,521,357) (22,777,120)
Increase 4,619,719 6,396,763 9,057,784
2,494,478
Net increase 7,360,455 8,849,183 9,057,784
2,494,478
Net Assets at beginning of year 35,299,525 20,563,222
24,290,006 15,495,643
Net Assets at end of period $ 42,659,980 $ 29,412,405 $
33,347,790 $ 17,990,121
Shares sold 502,186 645,390 51,889,887
24,796,600
Reinvested distributions 20,908 18,105 689,254 474,998
Shares redeemed (213,172) (158,193) (43,521,357)
(22,777,120)
Net Increase 309,922 505,302 9,057,784
2,494,478
Shares outstanding at beginning of year 2,483,962 1,675,654
24,290,006 15,495,643
Shares outstanding at end of period 2,793,884 2,180,956
33,347,790 17,990,121
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
statement of changes in net assets (continued)
for the six months ended June 30, 1996 and 1995
(unaudited)
Portfolio
Bond Managed
1996 1995 1996 1995
Operations:
Net investment income $ 783,254 $ 736,015 $ 575,415 $
566,582
Net realized gain 74,491 70,200 241,384
329,361
Net unrealized gain (loss) (1,488,532) 1,524,354 495,368
2,056,584
Increase (Decrease) in Assets
from Operations (630,787) 2,330,569
1,312,167 2,952,527
Distributions:
From net investment income (784,179) (735,762) (577,999)
(564,318)
From net realized gain
Decrease (784,179) (735,762) (577,999)
(564,318)
Shareholder Transactions:
Proceeds from shares sold 8,249,299 4,090,414 7,725,067
4,710,526
Reinvested distributions 662,085 405,621 554,986
450,096
Cost of shares redeemed (5,803,467) (2,636,447)
(3,973,429) (2,872,673)
Increase 3,107,917 1,859,588 4,306,624
2,287,949
Net increase 1,692,951 3,454,395 5,040,792
4,676,158
Net Assets at beginning of year 25,429,165 20,452,715
30,844,602 24,558,178
Net Assets at end of period $ 27,122,116 $ 23,907,110 $
35,885,394 $ 29,234,336
Shares sold 768,123 389,868 612,587 409,835
Reinvested distributions 62,691 38,540 44,070 38,554
Shares redeemed (546,161) (246,050) (313,950)
(246,845)
Net Increase 284,653 182,358 342,707 201,544
Shares outstanding at beginning of year 2,298,581 2,046,361
2,484,037 2,233,298
Shares outstanding at end of period 2,583,234 2,228,719
2,826,744 2,434,842
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
statement of changes in net assets (continued)
for the six months ended June 30, 1996 and 1995
(unaudited)
Portfolio
Tactical Asset (1)
1996
Operations:
Net investment income $ 19,298
Net realized gain 9,417
Net unrealized gain (loss) 24,121
Increase (Decrease) in Assets
from Operations 52,836
Distributions:
From net investment income (18,864)
From net realized gain
Decrease (18,864)
Shareholder Transactions:
Proceeds from shares sold 599,123
Reinvested distributions 5,799
Cost of shares redeemed (20,485)
Increase 584,437
Net increase 618,409
Net Assets at beginning of year 1,139,456
Net Assets at end of period $ 1,757,865
Shares sold 55,008
Reinvested distributions 538
Shares redeemed (1,877)
Net Increase 53,669
Shares outstanding at beginning of year 109,147
Shares outstanding at end of period 162,816
(1) Tactical Asset Portfolio inception was July 31, 1995. Only the period ending
June 30,1996 is presented.
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
schedule of investments
equity portfolio
June 30, 1996
(unaudited)<PAGE>
Market Market
Description Shares Value Description Shares Value
Common Stock (85.0%)
Banks & Financial (7.7%)
American Express Co. 22,200 $ 990,675
Banc One Corp. 32,730 1,112,820
Ohio Casualty Corp. 20,300 705,425
Salomon, Inc. 10,700 470,800
3,279,720
Broadcasting & Publishing (9.4%)
Chris-Craft Industries, Inc.* 20,420 898,480
Deluxe Corp. 21,300 756,150
Gibson Greetings, Inc. 49,200 676,500
Harland (John H.) Co. 19,300 475,262
Meredith Corp. 15,100 630,425
Moore Corp., Ltd. 30,600 577,575
4,014,392
Chemicals (1.6%)
Carlisle Companies, Inc. 6,600 350,625
Quaker Chemical Corp. 24,800 316,200
666,825
Electrical Equipment &
Electronics (7.3%)
Baldor Electric Co. 29,610 666,225
Dynatech Corp.* 58,900 1,914,250
General Electric Co. 6,400 553,600
3,134,075
Entertainment & Leisure (4.5%)
CPI Corp. 59,500 981,750
Fleetwood Enterprises, Inc. 30,900 957,900
1,939,650
Food & Beverage (1.6%)
Michael Foods, Inc. 49,300 573,113
Seagram Company, Ltd. 2,900 97,512
670,625
Furniture and Apparel (13.4%)
Blair Corp. 4,000 94,500
Hillenbrand Industries, Inc. 26,400 983,400
Kellwood Co. 32,000 588,000
La Z Boy Chair Co. 30,500 918,813
Liz Claiborne, Inc. 40,500 1,402,312
Oshkosh B'Gosh, Inc. 38,200 687,600
Class A
Reebok International 30,800 1,035,650
5,710,275
Health Care (6.1%)
Acuson Corp. 30,300 $ 484,800
Guidant Corp. 5,983 294,663
Lilly (Eli) & Co. 6,770 440,050
Merck & Co. 10,500 678,562
McKesson Corporation 15,200 723,900
2,621,975
Information Processing &
Telecommunications (6.9%)
Apple Computer, Inc. 20,200 424,200
Cray Research, Inc.* 1,585 38,238
International Business 7,700 762,300
Machines Corp.
Sun Microsystems, Inc.* 26,300 1,548,413
Telxon Corp. 15,600 183,300
2,956,451
Machinery (2.3%)
Lawson Products, Inc. 21,300 537,825
Precision Castparts Corp. 10,300 442,900
980,725
Merchandising (4.7%)
Longs Drug Stores Corp. 22,300 995,138
Mac Frugal's Bargains 21,500 381,625
Close-outs, Inc.
Mercantile Stores Co. 10,900 639,012
2,015,775
Metals & Mining (2.1%)
Aluminum Company of 9,600 550,800
America
Oregon Steel Mills, Inc. 26,000 357,500
908,300
Oil & Oil Services (3.5%)
Royal Dutch Petroleum Co. 4,300 661,125
Valero Energy Crop. 33,100 827,500
1,488,625
Transportation (3.5%)
Alexander & Baldwin, Inc. 34,100 822,663
Norfolk Southern Corp. 7,800 661,050
1,483,713
*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
equity portfolio (continued)
June 30, 1996
(unaudited)
Market
Description Shares Value
Common Stock (85.0%), continued
Miscellaneous (10.4%)
Boeing Co. 8,500 $ 740,562
Cross (A.T.) Co. Class A 38,300 679,825
Fluor Daniel 21,306 234,366
Ford Motor Co. 27,800 900,025
Kelly Services, Inc. 33,700 985,725
Sealright, Inc. 28,500 309,938
Stanhome, Inc. 23,000 609,500
4,459,941
Total common stock (cost: $28,967,447) 36,331,067
Money Market Mutual Funds (6.1%)
Riverfront U.S. Government Security 1,056,098 1,056,098
Merrill Lynch Institutional Fund 1,532,853 1,532,853
Total mutual funds (cost: $2,588,951) 2,588,951
Interest Maturity Principal
Rate Date Amount
Short-term Notes (8.9%)
Associates Corporation of North America 5.290% 7/26/96
1,000,000 996,326
American Express Credit 5.410% 7/15/96
1,000,000 997,943
Ford Motor Credit Corporation 5.290% 7/12/96
600,000 599,030
GE Capital 5.380% 8/23/96
600,000 595,248
U.S. Treasury Note 6.500% 5/15/97
600,000 603,762
Total short-term notes (cost: $3,795,599) 3,792,309
Total Investments (cost: $35,351,997) $ 42,712,327
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
statement of investments
money market portfolio
June 30, 1996
(unaudited)
Interest Maturity Principal Market
Description Rate Date Amount Value
Short-term Notes (94.5%)
U.S. Government & Agency Obligations (57.1%)
Federal Home Loan Bank Notes 5.220% 7/01/96 $ 5,000,000 $
5,000,000
Federal Home Loan Bank Notes 5.230% 8/05/96 3,500,000
3,482,204
Federal Home Loan Mortgage Corporation Notes 5.240% 7/22/96
3,700,000 3,688,690
Federal Home Loan Bank Notes 5.200% 7/11/96 4,000,000
3,994,222
Federal Home Loan Bank Notes 5.240% 7/15/96 2,500,000
2,494,906
Total short-term notes (cost: $18,660,022) 18,660,022
Corporate Obligations (37.5%)
Automotive (4.0%)
Ford Motor Credit Corporation 5.380% 7/26/96 1,300,000
1,300,000
Electrical Equipment (12.2%)
General Electric Capital Corporation 5.340% 7/12/96 1,200,000
1,200,000
General Electric Capital Corporation 5.327% 7/10/96 1,500,000
1,500,000
General Electric Company 5.356% 7/16/96 1,300,000
1,300,000
Financial (9.3%)
Norwest Financial Corporation 5.280% 7/11/96 1,550,000
1,550,000
Prudential Funding Corporation 5.335% 7/08/96 1,500,000
1,500,000
Machinery (2.8%)
John Deere Capital Corporation 5.364% 7/17/96 900,000
900,000
Oil and Gas (4.3%)
Chevron Oil Finance Company 5.346% 7/22/96 1,400,000
1,400,000
Real Estate and Leasing (4.9%)
Associates Corporation of North America 5.418% 8/05/96
1,600,000 1,600,000
Total corporate obligations (cost: $12,250,000) 12,250,000
Shares
Money Market Mutual Funds(5.5%)
Dreyfus Masternote Account 100,000 100,000
Merrill Lynch Institutional Fund 100,000 100,000
Riverfront U.S. Government Security 1,596,779 1,596,779
Total money market mutual funds (cost: $1,796,779) 1,796,779
Total Investments (cost: $32,706,801) $ 32,706,801
*variable rate note
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
schedule of investments
bond portfolio
June 30, 1996
(unaudited)
Interest Maturity Principal Market
Description Rate Date Amount Value
Long-term Notes and Bonds (97.7%)
U.S. Government & Agency Obligations (54.1%)
Federal Home Loan Bank Notes 8.375% 10/25/99 $ 1,300,000 $
1,371,877
Federal Home Loan Bank Notes 5.040% 8/20/98 750,000
731,167
U.S. Treasury Notes 9.375% 2/15/06 850,000
1,009,366
U.S. Treasury Bonds 8.750% 5/15/17 2,750,000
3,261,583
U.S. Treasury Notes 8.000% 5/15/01 1,350,000
1,435,307
U.S. Treasury Notes 7.500% 5/15/02 2,050,000
2,147,252
U.S. Treasury Notes 7.250% 8/15/04 2,100,000
2,175,222
U.S. Treasury Notes 8.875% 2/15/99 1,650,000
1,752,647
U.S. Treasury Strips 2/15/07 1,300,000
632,398
14,516,819
Collateralized Mortgage Obligations (16.7%)
American Southwest Financial Corporation 8.900% 3/01/18
189,899 186,090
Federal National Mortgage Association Notes CMO 7.500% 12/25/09
600,000 582,546
Federal National Mortgage Association Notes CMO 6.500% 5/25/08
800,000 763,752
Fleet Mortgage Securities, Inc. CMO 7.950% 6/01/19 650,620
663,606
Merrill Lynch CMO Trust XXXVIID 8.150% 11/01/18 720,000
734,673
Prudential-Bache Trust CMO 12D 5.350% 10/20/09 1,550,327
1,530,296
4,460,963
Corporate Obligations (26.9%)
Allstate Corporation Notes 5.875% 6/15/98 625,000
617,969
Associates Corporation of North America Notes 5.600% 1/15/01
1,600,000 1,520,000
El Paso Natural Gas Company Notes 7.750% 1/15/02 200,000
205,500
General Motors Acceptance Corporation Notes 5.450% 3/01/99
1,000,000 971,250
Hydro-Quebec Debenture Bonds 8.050% 7/07/24 400,000
424,000
Eli Lilly & Company Notes 8.375% 12/01/06 850,000
927,562
Providence of Ontario Notes 7.625% 6/22/04 950,000
980,875
Service Company International Notes 6.750% 6/01/01 900,000
891,000
Sun, Inc., Debenture Bonds 9.000% 11/01/24 600,000
663,750
7,201,906
Total long-term notes and bonds (cost: $26,003,144) 26,179,688
Shares
Money Market Mutual Funds (2.3%)
Riverfront U.S. Government Security 551,626 551,626
Merrill Lynch Institutional Fund 54,442 54,442
Total mutual funds (cost: $606,068) 606,068
Total Investments (cost: $26,609,212) $ 26,785,756
The accompanying notes are an integral part of the financial statements.<PAGE>
AUL American Series Fund, Inc.
schedule of investments
managed portfolio
June 30, 1996
(unaudited)
Market Market
Description Shares Value Description Shares Value
Common Stock (50.6%)
Banks & Financial (4.5%)
American Express Co. 10,300 $ 459,637
Banc One Corp. 16,550 562,700
Ohio Casualty Corp. 9,900 344,025
Salomon, Inc. 5,200 228,800
1,595,162
Broadcasting & Publishing (5.6%)
Chris-Craft Industries, Inc.* 9,911 436,084
Deluxe Corp. 10,400 369,200
Gibson Greetings, Inc. 25,900 356,125
Harland (John H.) Co. 9,700 238,863
Meredith Corp. 7,200 300,600
Moore Corp., Ltd. 14,500 273,687
1,974,559
Chemicals (0.8%)
Carlisle Companies, Inc. 3,100 164,687
Quaker Chemical Corp. 10,000 127,500
292,187
Electrical Equipment &
Electronics (4.5%)
Baldor Electric Co. 16,450 370,125
Dynatech Corp.* 29,000 942,500
General Electric Co. 3,200 276,800
1,589,425
Entertainment & Leisure (2.7%)
CPI Corp. 28,900 476,850
Fleetwood Enterprises 15,300 474,300
951,150
Furniture and Apparel (7.9%)
Blair Corp. 1,200 28,350
Hillenbrand Industries, Inc. 12,400 461,900
Kellwood Co. 15,500 284,813
La Z Boy Chair Co. 14,900 448,863
Liz Claiborne, Inc. 20,700 716,737
Oshkosh B'Gosh, Inc. 18,100 325,800
Class A
Reebok International 15,800 531,275
2,797,738
Food & Beverage (0.9%)
Michael Foods, Inc. 23,400 272,025
Seagram Company, Ltd. 1,400 47,075
319,100
<PAGE>
Health Care (3.7%)
Acuson Corp. 16,200 $ 259,200
Guidant Corp. 3,050 150,213
Lilly (Eli) & Co. 3,252 211,380
Merck & Co. 5,100 329,587
McKesson Corporation 7,600 361,950
1,312,330
Information Processing &
Telecommunications (4.2%)
Apple Computer, Inc. 11,100 233,100
Cray Research, Inc.* 660 15,922
International Business 3,900 386,100
Machines Corp.
Sun Microsystems, Inc.* 13,400 788,925
Telxon Corp. 7,900 92,825
1,516,872
Machinery (1.3%)
Lawson Products, Inc. 9,600 242,400
Precision Castparts Corp. 5,100 219,300
461,700
Merchandising (2.7%)
Longs Drug Stores Corp. 10,700 477,488
Mac Frugal's Bargains 10,700 189,925
Close-outs, Inc.
Mercantile Stores Co. 5,400 316,575
983,988
Metals & Mining (1.3%)
Aluminum Company of 4,800 275,400
America
Oregon Steel Mills, Inc. 14,500 199,375
474,775
Oil & Oil Services (2.2%)
Royal Dutch Petroleum Co. 2,100 322,875
Valero Energy Crop. 18,000 450,000
772,875
Transportation (2.0%)
Alexander & Baldwin, Inc. 16,400 395,650
Norfolk Southern Corp. 3,800 322,050
717,700
*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
managed portfolio (continued)
June 30, 1196
(unaudited)
Market
Description Shares Value
Common Stock (50.6%), continued
Miscellaneous (6.3%)
Boeing Co. 4,100 $ 357,213
Cross (A.T.) Co. Class A 20,800 369,200
Fluor Daniel 11,655 128,205
Ford Motor Co. 14,600 472,675
Kelly Services, Inc. 16,300 476,775
Sealright, Inc. 11,800 128,325
Stanhome, Inc. 11,900 315,350
2,247,743
Total common stock (cost: $14,429,502) 18,007,304
Money Market Mutual Funds (4.5%)
Riverfront U.S. Government Security 1,259,720 1,259,720
Merrill Lynch Institutional Fund 326,764 326,764
Total money market mutual funds (cost: $1,586,484) 1,586,484
Interest Maturity Principal
Rate Date Amount
Notes and Bonds (44.9%)
U.S. Government and Agency Obligations (33.8%)
Federal Home Loan Bank Bonds 8.600% 6/25/99 $ 500,000
528,045
Federal Home Loan Bank Bonds 8.375% 10/25/99 900,000
949,761
Federal Home Loan Bank Bonds 8.250% 9/25/96 500,000
503,070
Federal Home Loan Banks Notes 5.040% 8/20/98 250,000
243,723
Federal National Mortgage Association Bonds 8.350% 11/10/99
500,000 527,280
Federal National Mortgage Association CMO 6.500% 5/25/08
500,000 477,345
U.S. Treasury Bonds 9.375% 2/15/06 800,000
949,992
U.S. Treasury Bonds 8.750% 5/15/17 1,450,000
1,719,743
U.S. Treasury Notes 8.000% 5/15/01 625,000
664,494
U.S. Treasury Notes 7.500% 5/15/02 2,050,000
2,147,252
U.S. Treasury Notes 7.250% 8/15/04 2,000,000
2,071,640
U.S. Tresaury Notes 8.875% 2/15/99 850,000
902,878
U.S. Treasury Strips 2/15/07 700,000
340,522
12,025,745
Corporate Obligations (11.1%)
Allstate Corporation Notes 5.875% 6/15/98 250,000
247,188
Associates Corporation of North America 5.600% 1/15/01
400,000 380,000
El Paso Natural Gas Company Notes 7.750% 1/15/02 100,000
102,750
General Motors Acceptance Corporation Notes 5.450% 3/01/99
800,000 777,000
Hydro-Quebec Debenture Bonds 8.050% 7/07/24 250,000
265,000
Eli Lilly & Company Notes 8.375% 12/01/06 450,000
491,063
Providence of Ontario Notes 7.625% 6/22/04 550,000
567,875
Service Company International Notes 6.750% 6/01/01 700,000
693,000
Sun, Inc. Debenture Bonds 9.000% 11/01/24 400,000
442,500
Total notes and bonds (cost: $15,991,786) 15,992,121
Total Investments (cost: $32,007,772) $ 35,585,909
*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
June 30, 1996
(unaudited)
Market Market
Description Shares Value Description Shares Value
Common Stock (52.1%)
Automotive & Truck (2.7%)
Chrysler Corp. 400 $ 24,800
Ford Motor Co. 700 22,662
47,462
Bank & Financial (9.1%)
AFLAC, Inc. 600 17,925
AMBAC, Inc. 400 20,850
Countrywide Credit Ind. 800 19,800
Federal Home Loan
Mortgage Corp. 200 17,100
Federal National Mortgage
Association 400 13,400
Integon Corp. 1,000 20,125
John Alden Financial Corp. 1,000 22,125
Lehman Brothers Holding, Inc. 500 12,375
PMI Group, Inc. 500 21,250
164,950
Chemicals (4.4%)
Dow Chemical Co. 400 30,400
Eastman Chemical Co. 300 18,263
Georgia Gulf Corp. 1,000 29,250
77,913
Health Care (0.8%)
Humana, Inc. 800 14,300
14,300
Information Processing &
Telecommunications (10.4%)
American Power 2,000 20,500
Applied Materials, Inc. 500 15,250
EMC Corp. 800 14,900
Intel Corp. 300 22,031
Novell, Inc. 2,000 27,750
Phillips Electronics NV 600 19,575
Read-Rite Corp. 1,200 16,950
Seagate Technology, Inc. 700 31,500
Sprint Corp. 400 16,800
185,256
Merchandising (8.3%)
Fingerhut Companies, Inc. 1,500 $ 23,438
May Department Store, Inc. 400 17,500
Payless Shoesource, Inc. 64 2,032
Russell Corporation 1,000 27,625
TJX Companies, Inc. 1,000 33,750
Toys R US 1,000 28,500
Value City Department Store 1,500 16,500
149,345
Metals & Mining (5.4%)
Alumax, Inc. 1,000 30,375
Aluminum Co. of America 400 22,950
Birmingham Steel Corp. 1,400 22,925
Potash Corp. of Saskatchewan 300 19,875
96,125
Oil & Oil Services (3.4%)
Ashland, Inc. 400 15,850
Horsham Corporation 1,200 16,650
Southwestern Energy, Inc. 1,000 14,125
Valero Energy Corp. 600 15,000
61,625
Paper & Containers (2.5%)
International Paper Co. 600 22,125
Louisiana-Pacific Corp. 1,000 22,125
44,250
Tobacco (2.5%)
Philip Morris Cos., Inc. 200 20,800
UST, Inc. 700 23,975
44,775
Miscellaneous (2.6%)
Teleflex, Inc. 500 23,875
USG Corp. 800 22,300
46,175
Total common stock (cost: $857,989) $ 932,176
*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 (continued)
June 30, 1996
(unaudited)
Market
Description Shares Value
Preferred Stock (1.5%)
K-Mart Financial Preferred Convertible 500 $ 27,125
Total preferred stocks (cost: $25,000) 27,125
Money Market Mutual Funds (4.0%)
Riverfront U.S. Government Security 71,420 71,420
Total mutual funds (cost: $71,420) 71,420
Interest Maturity Principal
Rate Date Amount
Notes and Bonds (42.4%)
Federal Home Loan Mortgage Corp. Note 5.340% 7/03/96
25,000 24,982
Federal National Mortgage Association Note 5.370% 7/05/96
20,000 19,980
Federal National Mortgage Association Note 5.370% 7/08/96
50,000 49,912
Federal National Mortgage Association Note 5.380% 7/11/96
50,000 49,875
Federal National Mortgage Association Note 5.380% 7/12/96
50,000 49,863
Federal National Mortgage Association Note 5.380% 7/18/96
40,000 39,883
U.S. Treasury Note 5.500% 7/31/97 100,000
99,651
U.S. Treasury Note 6.000% 10/15/99 100,000
99,021
U.S. Treasury Note 5.500% 4/15/00 100,000
97,068
U.S. Treasury Note 5.250% 7/31/98 100,000
98,315
U.S. Treasury Note 7.500% 11/15/01 125,000
130,497
Total notes and bonds (cost: $766,859) 759,047
Total Investments (cost: $1,721,268) $ 1,789,768
The accompanying notes are an integral part of the financial statements.<PAGE>
(This page is intentionally blank.)<PAGE>
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 establish the Fund. As of June 30, 1996, AUL's
investment in the Fund is:
Equity Portfolio $ 3,091,634
Bond Portfolio 2,950,842
Managed Portfolio 721,512
Tactical Asset Portfolio 500,000
$ 7,263,988
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.<PAGE>
notes to financial statements (continued)
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 six months ended June 30, 1996 and
1995, were $326,316 and $229,526, 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 six months ended June 30, 1996, were:
Portfolio
Equity Money Market Bond Managed Tactical Asset
Common Stock:
Purchases $ 4,474,044 $ $
$ 2,014,864 $ 448,433
Proceeds from sales 1,808,175
2,161,144 105,238
Corporate Bonds:
Purchases 4,414,999
2,445,297 25,000
Proceeds from sales 2,688,051
1,446,515
Government Bonds:
Purchases 609,844 9,489,164
8,951,078 137,871
Proceeds from sales 8,191,412
5,569,289 103,284
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 $ 47,145,119 $ 132,434,000
$ 43,316,945 $ 47,089,015 $ 1,710,979
Cost of shares redeemed (11,931,898) (99,086,210)
(16,456,819) (15,027,585) (31,220)
Undistributed net investment
income (2,729) 10,955
4,444 190
Undistributed net realized
gain 89,158 74,490
241,384 9,417
Unrealized gain 7,360,330 176,545
3,578,136 68,499
$ 42,659,980 $ 33,347,790 $ 27,122,116 $
35,885,394 $ 1,757,865
<PAGE>
notes to financial statements (continued)
7. Selected Per Share Data and Ratios
The per share amounts are based on shares outstanding throughout the years.
Equity Portfolio
1996 1995 1994 1993 1992
Investment Income $ .18 $ 0.18 $ 0.15
$0.14 $ 0.17
Expense .05 0.04 0.05
0.05 0.05
Net investment income .13 0.14 0.10
0.09 0.12
Net gain (loss) on investments 1.06 1.22 (0.32)
0.43 0.28
Shareholder distributions:
Net investment income (.13) (0.14) (0.10)
(0.09) (0.12)
Realized gain
Net increase (decrease) 1.06 1.22 (0.32)
0.43 0.28
Net asset value at
beginning of year 14.21 12.27 12.68
11.49 10.89
Net asset value at end of period $ 15.27 $ 13.49
$ 12.36 $ 11.92 $ 11.17
Ratio to average net assets:*
Expense 0.70% 0.69%
0.78% 0.78% 0.86%
Net investment income 1.79% 2.27%
1.59% 1.57% 2.20%
Total return* 16.80% 22.06% (3.60%)
9.20% 7.30%
Portfolio turnover rate 5% 3% 13%
1% 7%
Shares outstanding 2,793,884 2,180,956 1,212,617
740,087 510,440
*annualized<PAGE>
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Money Market Portfolio
1996 1995 1994 1993 1992
Investment Income $.03 $ 0.04 $ 0.02
$0.02 $ 0.02
Expense 0.01 0.01 0.01
0.01
Net investment income .03 0.03 0.01
0.01 0.01
Net gain (loss) on investments
Shareholder distributions:
Net investment income (.03) (0.03)
(0.01) (0.01) (0.01)
Realized gain
Net increase (decrease)
Net asset value at
beginning of year 1.00 1.00 1.00
1.00 1.00
Net asset value at end of period $ 1.00 $ 1.00
$ 1.00 $ 1.00 $ 1.00
Ratio to average net assets:*
Expense 0.68% 0.69%
0.81% 0.78% 0.90%
Net investment income 4.65% 5.22% 2.80%
2.32% 3.37%
Total return* 4.52% 5.12% 2.72%
2.40% 3.40%
Portfolio turnover rate
Shares outstanding 33,347,789 17,990,121 8,643,286
5,590,482 5,371,652
*annualized<PAGE>
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Bond Portfolio
1996 1995 1994 1993 1992
Investment Income $ .35 $ 0.38
$ 0.35 $0.38 $ 0.41
Expense .04 0.04 0.04
0.04 0.05
Net investment income .31 0.34 0.31
0.34 0.36
Net gain (loss) on investments (.56) 0.74
(0.78) 0.48 (0.15)
Shareholder distributions:
Net investment income (.31) (0.34) (0.31)
(0.34) (0.36)
Realized gain
Net increase (decrease) (.56) 0.74 (0.78)
0.48 (0.15)
Net asset value at
beginning of year 11.06 9.99
11.00 10.65 10.90
Net asset value at end of period $ 10.50 $ 10.73
$ 10.22 $ 11.13 $ 10.75
Ratio to average net assets:*
Expense 0.70% 0.69%
0.77% 0.75% 0.84%
Net investment income 5.84% 6.50%
5.86% 6.21% 7.04%
Total return* (4.52%) 21.58% (8.70%)
15.60% 4.04%
Portfolio turnover rate 42% 19% 18%
14% 11%
Shares outstanding 2,583,234 2,228,719 1,676,873
1,156,033 1,103,316
*annualized<PAGE>
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Managed Portfolio
1996 1995 1994 1993 1992
Investment Income $ 0.26 $ 0.28 $ 0.24 $ 0.25 $ 0.32
Expense 0.05 0.04 0.05
0.04 0.05
Net investment income 0.21 0.24 0.19
0.21 0.27
Net gain (loss) on investments 0.28 1.01
(0.60) 0.50 (0.05)
Shareholder distributions:
Net investment income (0.21) (0.24) (0.19)
(0.21) (0.27)
Realized gain
Net increase (decrease) .28 1.01 (0.60)
0.50 (0.05)
Net asset value at
beginning of year 12.42 11.00
11.75 10.92 10.86
Net asset value at end of period $ 12.70 $ 12.01
$ 11.15 $ 11.42 $ 10.81
Ratio to average net assets:*
Expense 0.70% 0.69%
0.77% 0.76% 0.85%
Net investment income 3.38% 4.20%
3.34% 3.70% 4.98%
Total return* 7.92% 22.86% (7.28%)
12.80% 3.88%
Portfolio turnover rate 28% 19% 13%
2% 17%
Shares outstanding 2,826,744 2,434,842 1,786,822
877,857 664,673
*annualized<PAGE>
notes to financial statements (continued)
7. Selected Per Share Data and Ratios, continued
Tactical Asset(1)
1996
Investment Income $ 0.20
Expense 0.05
Net investment income 0.15
Net gain (loss) on investments 0.36
Shareholder distributions:
Net investment income (0.15)
Realized gain
Net increase (decrease) 0.36
Net asset value at
beginning of year 10.44
Net asset value at end of period $ 10.80
Ratio to average net assets:*
Expense 1.00%
Net investment income 2.74%
Total return* 9.28%
Portfolio turnover rate 16%
Shares outstanding 162,816
*annualized
(1) Tactical Asset Portfolio inception was July 31, 1995. Only the period ending
June 30, 1996 is presented.<PAGE>
notes to financial statements (continued)
8. Unrealized Gain (Loss)
Portfolio
Equity Money Market Bond Managed Tactical Asset
Common Stock:
Appreciation $ 8,613,128 $ $
$ 4,240,288 $ 105,098
Depreciation (1,249,508)
(662,486) (30,911)
Notes and Bonds:
Appreciation 538,742
236,812 2,202
Depreciation (3,290) (362,197)
(236,478) (7,890)
$ 7,360,330 $ $ 176,545
$ 3,578,136 $ 68,499
6. Net Shareholders
Portfolio
Equity Money Market Bond Managed Tactical Asset
AUL 309,609 294,595
72,304 50,001
Dean Investments
50,000
AUL American Unit Trust 1,264,415 4,596,042 611,229
1,311,539
AUL Group Retirement Annuity
Separate Account II 1,057,482 26,742,907 1,528,757
1,287,902
AUL American Individual
Unit Trust 162,378 2,008,841 148,653
154,999 62,815
2,793,884 33,347,790 2,583,234
2,826,744 162,816
<PAGE>
American United Life Insurance Company
P.O. Box 368
Indianapolis, Indiana 46206-0368
P-13959
