A Message
From
The Chairman of the Board
and President of
AUL American Series Fund, Inc.
To Participants in AUL American Unit Trust
The U.S. economy continued to surprise investors with its performance during
1997. The current seven year expansion has been unique in that economic growth
has remained moderate while inflationary pressures have been subdued. The
inflation rate actually declined during 1997, allowing the Federal Reserve to
hold monetary policy steady during the last nine months of the year. Other
positive economic factors during the year included lower interest rates, higher
productivity and improved corporate profit margins.
Equity investors were richly rewarded during the past year with the Dow Jones
Industrial Average and the S&P 500 (commonly quoted equity indices) both
achieving double digit returns. During 1997, equity investors reacted positively
to the combination of slow growth and moderate inflation. However, the
volatility of returns increased dramatically during the second half of the year
as investors became fearful that corporations would experience a decline in
profit growth during 1998. Severe weakness in Asia and Latin America was another
principal catalyst causing increased volatility.
Bond yields moved higher in the first quarter of 1997 in reaction to the Federal
Reserve Bank's 25 basis point increase in the Federal Funds rate target but
declined over the remainder of the year. Moderate inflation, a declining federal
deficit, and turmoil in the Asian markets caused the Federal Reserve Bank to
withhold any further intervention, despite strong economic growth and low
unemployment. As a result, bond returns, especially for bonds with longer
maturities, were competitive with common stocks in the last six months of 1997
although they still trailed well behind equity returns for the entire year.
At the present time, most economists are expecting economic growth to decelerate
in 1998 as a result of weaker domestic demand and momentum lost from foreign
trade. Slower growth does have some positive aspects. However, equity investors
remain focused on the possibility of weaker corporate profits.
Equity investors have now experienced three years of phenomenal equity returns,
returns which are substantially higher than the long-term averages. The major
stock indices could still post further gains during 1998, but the opportunity to
dramatically outperform the long-term averages becomes extremely limited. Good
bond performance will depend on declining interest rates, continued moderate
inflation and bonds being viewed as an "alternative investment" for equity
investors.
/s/James W. Murphy
Chairman of the Board of Directors and President
Indianapolis, Indiana
January 20, 1998
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Report of Independent Accountants
The Contract Owners of
AUL American Unit Trust and
Board of Directors of
American United Life Insurance Company
We have audited the accompanying statements of net assets of AUL American Unit
Trust as of December 31, 1997, and the related statements of operations and
changes in net assets for each of the two years in the period then ended. These
financial statements are the responsibility of the Trust'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 securities owned as of December 31, 1997, by correspondence with
the custodians. 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 referred to above present fairly, in
all material respects, the financial position of AUL American Unit Trust as of
December 31, 1997, and the results of its operations and changes in net assets
for each of the two years in the period then ended, in conformity with generally
accepted accounting principles.
/s/ Coopers & Lybrand L.L.P.
Indianapolis, Indiana
February 2, 1998
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AUL American Unit Trust
STATEMENTS OF NET ASSETS
December 31, 1997
Series Fund Fidelity
----------------------------------------------------- -----------
Equity Money Mkt Bond Managed Tact Asst HighIncome
Assets:
Investments
at value $33,955,106 $ 7,349,731 $8,490,917 $23,765,300 $ 111 $13,541,887
Net Assets $33,955,106 $ 7,349,731 $8,490,917 $23,765,300 $ 111 $13,541,887
Units
out
standing 12,586,036 5,765,433 4,937,428 10,816,324 100 8,053,332
Accum.
Unit Value $ 2.70 $ 1.27 $ 1.72 $ 2.20 $ 1.11 $ 1.68
the accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF NET ASSETS (continued)
December 31, 1997
Fidelity
-----------------------------------------------------------------------
Growth Overseas Asst Mgr Index 500 Equity-Inc. Contrafund
Assets:
Investments
at value$55,118,978 $14,204,012 $50,292,210 $42,003,492 $12,177,905 $16,668,206
Net
Assets $55,118,978 $14,204,012 $50,292,210 $42,003,492 $12,177,905 $16,668,206
Units
out
standing 26,493,376 9,308,550 30,831,927 18,374,733 6,959,675 8,965,623
Accum.
Unit Value $ 2.08 $ 1.53 $ 1.63 $ 2.29 $ 1.75 $ 1.86
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF NET ASSETS (continued)
December 31, 1997
American
Century Alger Calvert T.RowePrice PBHG
------------ ---------- --------- ------------- ----------------------
VP Capital American Capital Tech. &
Apprec. Growth Accum. Equity Inc. Growth II Commun.
Assets:
Investments
at value $2,309,700 $19,116,058 $1,755,044 $21,526,126 $62,345 $104,911
Net
Assets $2,309,700 $19,116,058 $1,755,044 $21,526,126 $62,345 $104,911
Units
out
standing 1,970,129 10,920,405 1,070,537 11,646,682 58,505 101,585
Accum.
Unit Value $ 1.17 $ 1.75 $ 1.64 $ 1.85 $ 1.07 $ 1.03
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF NET ASSETS (continued)
December 31, 1997
Janus Safeco
--------------------- ---------------------
Worldwide Flexible
Growth Income Equity Growth
Assets:
Investments
at value $ 2,427,800 $ 313,657 $ 216,123 $ 1,505,305
Net Assets $ 2,427,800 $ 313,657 $ 216,123 $ 1,505,305
Units
outstanding 2,126,372 289,354 186,090 1,069,115
Accum.
Unit Value $ 1.14 $ 1.08 $ 1.16 $ 1.41
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS
for the years ended December 31, 1997 and 1996
Series Fund
-------------------------------------------------------------------
Equity Money Market Bond
-------------------- ------------------------ ---------------------
1997 1996 1997 1996 1997 1996
Operations:
Dividend
income $ 788,183 $ 342,380 $ 286,404 $ 196,825 $ 579,827 $ 400,603
Mortality
& expense
charges 355,069 241,613 73,604 52,481 104,776 81,206
Net Investment
Income
(Loss) 433,114 100,767 212,800 144,344 475,051 319,397
Gain (Loss) on Investments:
Net realized gain
(loss) 1,929,622 757,430 100,116 (29,008)
Net change in
unrealized
gain(loss) 4,385,719 2,298,293 (88,037) (194,208)
Net Gain
(Loss) 6,315,341 3,055,723 12,079 (223,216)
Increase (Decrease)
in Net Assets from
Operations 6,748,455 3,156,490 212,800 144,344 487,130 96,181
Contract Owner Transactions:
Proceeds from
units sold 9,972,396 5,750,853 33,320,250 19,881,137 2,747,432 2,965,354
Cost of units
redeemed (5,083,812)(3,302,017) (31,019,567)(17,646,620)(2,070,656)(1,514,837)
Increase 4,888,584 2,448,836 2,300,683 2,234,517 676,776 1,450,517
Net
increase 11,637,039 5,605,326 2,513,483 2,378,861 1,163,906 1,546,698
Net Assets,
beginning 22,318,067 16,712,742 4,836,248 2,457,387 7,327,011 5,780,313
Net Assets,
ending 33,955,106 $22,318,068 $ 7,349,731 $4,836,248 $8,490,917 $7,327,011
Units sold 4,078,308 2,955,925 26,576,977 16,432,700 1,664,142 1,883,899
Units
redeemed (2,081,627) (1,698,792)(24,742,816) (14,567,921)(1,261,885) (962,211)
Net
increase 1,996,681 1,257,133 1,834,161 1,864,779 402,257 921,688
Units
outstanding,
beginning 10,589,355 9,332,222 3,931,272 2,066,493 4,535,171 3,613,483
Units
outstanding,
ending 12,586,036 10,589,355 5,765,433 3,931,272 4,937,428 4,535,171
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
Series Fund Fidelity
----------------------------------------- -------------------
Managed Tactical Asset High Income
----------------------- ----------------- -------------------
1997 1996 1997(1) 1997 1996
Operations:
Dividend
income $ 1,251,403 $ 601,614 $ 8 $ 796,755 $ 559,290
Mortality
& expense
charges 265,574 210,007 146,800 97,295
Net Investment
Income(Loss) 985,829 391,607 8 649,955 461,995
Gain (Loss) on Investments:
Net realized gain
(loss) 671,399 231,999 516,248 147,051
Net change in
unrealized gain
(loss) 2,073,656 1,074,348 3 596,160 304,521
Net Gain
(Loss) 2,745,055 1,306,347 3 1,112,408 451,572
Increase (Decrease)
in Net Assets from
Operations 3,730,884 1,697,954 11 1,762,363 913,567
Contract Owner Transactions:
Proceeds from
units sold 4,647,229 3,787,607 100 5,631,914 4,302,859
Cost of units
redeemed (3,155,198) (2,327,899 (3,515,487) (1,616,681)
Increase 1,492,031 1,459,708 100 2,116,427 2,686,178
Net
increase 5,222,915 3,157,662 111 3,878,790 3,599,745
Net Assets,
beginning 18,542,385 15,384,723 9,663,097 6,063,352
Net Assets,
ending $ 23,765,300 $ 18,542,385 $ 111 $ 13,541,887 $ 9,663,097
Units sold 2,298,195 2,192,882 100 3,595,859 3,144,988
Units
redeemed (1,569,057) (1,347,716) (2,221,754) (1,185,689)
Net increase 729,138 845,166 100 1,374,105 1,959,299
Units
outstanding,
beginning 10,087,186 9,242,020 6,679,227 4,719,928
Units
outstanding,
ending 10,816,324 10,087,186 100 8,053,332 6,679,227
(1) for the Period from May 1, 1997 to December 31, 1997.
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
Fidelity
----------------------------------------------------------------------
Growth Overseas Asset Manager
----------------------- ---------------------- -----------------------
1997 1996 1997 1996 1997 1996
Operations:
Dividend
income $ 1,439,710 $ 1,686,076 $ 1,001,817 $ 195,920 $ 4,572,177 $ 1,858,564
Mortality
& expense
charges 590,413 384,618 171,253 119,355 549,366 396,998
Net Investment
Income(Loss) 849,297 1,301,458 830,564 76,565 4,022,811 1,461,566
Gain (Loss) on Investments:
Net realized gain
(loss) 2,345,762 2,576,639 1,428,939 588,813 1,075,838 304,397
Net change in
unrealized gain
(loss) 5,881,034 (241,271) (992,681) 428,901 2,515,095 2,252,257
Net Gain
(Loss) 8,226,796 2,335,368 436,258 1,017,714 3,590,933 2,556,654
Increase (Decrease)
in Net Assets from
Operations 9,076,093 3,636,826 1,266,822 1,094,279 7,613,744 4,018,220
Contract Owner Transactions:
Proceeds from
units
sold 17,758,368 20,256,098 16,550,480 8,171,841 11,799,650 9,564,824
Cost of units
redeemed (10,186,999) (7,954,526)(15,021,536)(5,759,471) (5,887,440) (4,541,090)
Increase 7,571,369 12,301,572 1,528,944 2,412,370 5,912,210 5,023,734
Net
increase 16,647,462 15,938,398 2,795,766 3,506,649 13,525,954 9,041,954
Net Assets,
begin. 38,471,516 22,533,118 11,408,246 7,901,597 36,766,256 27,724,302
Net Assets,
ending $55,118,978 $38,471,516 $14,204,012 $11,408,246 $50,292,210 $36,766,256
Units
sold 9,328,133 12,526,388 10,859,725 6,289,170 7,892,511 7,528,818
Units
redeem. (5,394,827) (4,932,924) (9,796,364) (4,429,500) (3,928,662) (3,592,303)
Net
increase 3,933,306 7,593,464 1,063,361 1,859,670 3,963,849 3,936,515
Units
outstanding,
begin. 22,560,070 14,966,606 8,245,189 6,385,519 26,868,078 22,931,563
Units
outstanding,
ending 26,493,376 22,560,070 9,308,550 8,245,189 30,831,927 2 6,868,078
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
Fidelity
-------------------------------------------------------------------
Index 500 Equity-Income Contrafund
--------------------- --------------------- -----------------------
1997 1996 1997 1996 1997 1996
Operations:
Dividend
income $ 653,527 $ 270,229 $ 626,460 $ 57,407 $ 231,987 $ 11,446
Mortality
& expense
charges 372,156 134,447 109,686 41,210 148,730 45,564
Net Investment Income
(Loss) 281,371 135,782 516,774 16,197 83,257 (34,118)
Gain (Loss) on Investments:
Net realized gain
(loss) 3,803,606 1,142,520 198,968 51,857 480,270 169,050
Net change in
unrealized gain
(loss) 3,223,254 903,193 1,255,124 366,426 1,791,596 624,118
Net Gain
(Loss) 7,026,860 2,045,713 1,454,092 418,283 2,271,866 793,168
Increase (Decrease)
in Net Assets from
Operations 7,308,231 2,181,495 1,970,866 434,480 2,355,123 759,050
Contract Owner Transactions:
Proceeds from
units
sold 33,188,691 13,729,783 5,754,994 5,379,426 9,337,115 6,820,829
Cost of units
redeemed (15,658,881) (4,462,861) (1,406,108) (887,971) (2,083,657)(1,395,994)
Increase 17,529,810 9,266,922 4,348,886 4,491,455 7,253,458 5,424,835
Net
increase 24,838,041 11,448,417 6,319,752 4,925,935 9,608,581 6,183,885
Net Assets,
begin. 17,165,451 5,717,034 5,858,153 932,218 7,059,625 875,740
Net Assets,
ending $42,003,492 $17,165,451 $12,177,905 $5,858,153 $16,668,206 $7,059,625
Units
sold 16,153,810 8,642,574 3,613,383 4,163,357 5,555,376 4,955,599
Units
redeemed (7,620,276) (2,778,057) (897,167) (682,030) (1,245,928) (991,402)
Net
increase 8,533,534 5,864,517 2,716,216 3,481,327 4,309,448 3,964,197
Units
outstanding,
beginning 9,841,199 3,976,682 4,243,459 762,132 4,656,175 691,978
Units
outstanding,
ending 18,374,733 9,841,199 6,959,675 4,243,459 8,965,623 4,656,175
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
American Century Alger Calvert
----------------- ----------------------- -------------------------
VP Cap. Apprec. American Growth Capital Accumulation
----------------- ----------------------- -------------------------
1997 1996 1997 1996 1997 1996
Operations:
Dividend
income $ 44,992 $158,096 $ 123,940 $ 118,973 $ 181,799 $ 1,665
Mortality
& expense
charges 27,094 20,98 182,029 66,741 17,649 8,227
Net Investment
Income(Loss) 17,898 137,115 (58,089) 52,232 164,150 (6,562)
Gain (Loss) on Investments:
Net realized gain
(loss) (242,024) 50,578 1,909,253 104,611 254,824 24,160
Net change in
unrealized gain
(loss) 82,323 (299,498) 917,221 441,596 (154,179) 21,786
Net Gain
(Loss) (159,701) (248,920) 2,826,474 546,207 100,645 45,946
Increase (Decrease)
in Net Assets from
Operations (141,803) (111,805) 2,768,385 598,439 264,795 39,384
Contract Owner Transactions:
Proceeds from
units
sold 1,386,304 1,647,386 17,980,961 11,464,782 4,105,208 8,157,650
Cost of units
redeemed (1,124,243) (315,880) (11,040,785) (3,951,097) (3,917,872) (6,984,043)
Increase 262,061 1,331,506 6,940,176 7,513,685 187,336 1,173,607
Net
increase 120,258 1,219,701 9,708,561 8,112,124 452,131 1,212,991
Net Assets,
beginning 2,189,442 969,741 9,407,497 1,295,373 1,302,913 89,922
Net Assets,
ending $ 2,309,700 $2,189,442 $ 19,116,058 $ 9,407,497 $ 1,755,044 $ 1,302,913
Units
sold 1,148,628 1,282,104 11,056,170 8,577,306 2,790,936 6,165,865
Units
redeemed (964,353) (244,029) (6,810,757) (2,931,153) (2,690,839) (5,266,458)
Net
increase 184,275 1,038,075 4,245,413 5,646,153 100,097 899,407
Units
outstanding,
begin. 1,785,854 747,779 6,674,992 1,028,839 970,440 71,033
Units
outstanding,
ending 1,970,129 1,785,854 10,920,405 6,674,992 1,070,537 970,440
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
T. Rowe Price PBHG Janus
-------------------- ------------------- ---------------------
Equity-Income Growth II Tech. Worldwide Flexible
&Comm. Growth Income
-------------------- ---------- --------- --------- ----------
1997 1996 1997(1) 1997(1) 1997(1) 1997(1)
Operations:
Dividend
income $ 972,267 $ 129,361 $ $ $ 5,662 $ 7,720
Mortality
& expense
charges 169,670 35,102 286 414 8,550 744
Net Investment
Income(Loss) 802,597 94,259 (286) (414) (2,888) 6,976
Gain (Loss) on Investments:
Net realized gain
(loss) 433,615 100,208 (340) 463 2,701 2,900
Net change in
unrealized gain
(loss) 1,951,034 339,665 (1,874) (13,550) (10,837) (3,837)
Net Gain
(Loss) 2,384,649 439,873 (2,214) (13,087) (8,136) (937)
Increase (Decrease)
in Net Assets from
Operations 3,187,246 534,132 (2,500) (13,501) (11,024) 6,039
Contract Owner Transactions:
Proceeds from
units
sold 13,767,571 6,412,176 86,468 118,430 2,560,652 410,273
Cost of units
redeemed (1,614,233) (1,238,837) (21,623) (18) ( 121,828) (102,655)
Increase 12,153,338 5,173,339 64,845 118,412 2,438,824 307,618
Net
increase 15,340,584 5,707,471 62,345 104,911 2,427,800 313,657
Net Assets,
beginning 6,185,542 478,071
Net Assets,
ending $ 21,526,126 $ 6,185,542 $ 62,345 $ 104,911 $ 2,427,800 $ 313,657
Units
sold 8,362,667 4,786,484 77,370 101,623 2,234,612 385,932
Units
redeemed (975,139) (916,062) (18,865) (38) (108,240) (96,578)
Net
increase 7,387,528 3,870,422 58,505 101,585 2,126,372 289,354
Units
outstanding,
beginning 4,259,154 388,732
Units
outstanding,
ending 11,646,682 4,259,154 58,505 101,585 2,126,372 289,354
(1) for the Period from May 1, 1997 to December 31, 1997.
The accompanying notes are an integral part of the financial statements.
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AUL American Unit Trust
STATEMENTS OF OPERATIONS AND CHANGES IN NET ASSETS (continued)
for the years ended December 31, 1997 and 1996
Safeco
--------------------------
Equity Growth
------------- ------------
1997(1) 1997(1)
Operations:
Dividend
income $ 15,690 $ 242,103
Mortality
& expense
charges 673 4,985
Net Investment
Income(Loss) 15,017 237,118
Gain (Loss) on Investments:
Net realized gain
(loss) (127) 49,644
Net change in
unrealized gain
(loss) (10,581) (180,480)
Net Gain (Loss) (10,708) (130,836)
Increase (Decrease)
in Net Assets from
Operations 4,309 106,282
Contract Owner Transactions:
Proceeds from
units sold 212,703 2,041,581
Cost of units
redeemed (889) (642,558)
Increase 211,814 1,399,023
Net increase 216,123 1,505,305
Net Assets,
beginning
Net Assets,
ending $ 216,123 $ 1,505,305
Units sold 186,896 1,550,299
Units
redeemed (806) (481,184)
Net increase 186,090 1,069,115
Units
outstanding,
beginning
Units
outstanding,
ending 186,090 1,069,115
(1) for the Period from May 1, 1997 to December 31, 1997.
The accompanying notes are an integral part of the financial statements.
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NOTES TO FINANCIAL STATEMENTS
1.Summary of Significant Accounting Policies
The AUL American Unit Trust (Variable Account) was established by American
United Life Insurance Company (AUL) on August 17, 1989, under procedures
established by Indiana law and is registered as a unit investment trust under
the Investment Company Act of 1940, as amended. The Variable Account is a
segregated investment account of AUL and invests exclusively in shares of mutual
fund portfolios offered by the AUL American Series Fund, Inc. (Series Fund),
Fidelity Investments Variable Insurance Products Fund and Variable Insurance
Products Fund II(Fidelity), American Century Variable Portfolios, Inc. (American
Century), Acacia Capital Corporation (Calvert), T. Rowe Price Equity Series,
Inc. (T. Rowe Price), PBHG Insurance Series Fund, Inc. (PBHG), Janus Aspen
Series (Janus), and Safeco Resource Series Trust (Safeco).
Security Valuation, Transactions and Related Investment Income
The market value of investments is based on the closing bid prices at December
31, 1997. Investment transactions are accounted for on the trade date and
dividend income is recorded on the ex-dividend date.
Mortality and Expense Risks Charges
AUL deducts a daily charge as compensation for the mortality and expense risks
assumed by AUL. The charge is equal on an annual basis to 1.25% of the average
daily net assets of each investment account. AUL guarantees that the mortality
and expense charge shall not increase. The charges incurred during the years
ended December 31, 1997 and 1996, were $3,299,521 and $1,935,845, respectively.
Taxes
Operations of the Variable Account are part of, and are taxed with, the
operations of AUL, which is taxed as a "life insurance company" under the
Internal Revenue Code. Under current law, investment income, including realized
and unrealized capital gains of the investment accounts, is not taxed to AUL to
the extent it is applied to increase reserves under the contracts. The Variable
Account has not been charged for federal and state income taxes since none have
been imposed.
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 and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the reporting period. Actual results could differ from those estimates.
2. Account Charges
AUL may assess a premium tax charge based on premium taxes incurred. Premium
taxes currently range between 0% and 3.5%, but are subject to change by
governmental entities. AUL deducts an annual administrative charge from each
participant's account which may not exceed the lesser of 0.5% of the
participant's account value or $7.50 per quarter. The charge is assessed every
quarter on a participant account if it is in effect on the quarterly contract
anniversary, and the charge is assessed only during the accumulation period. The
charges incurred during the years ended December 31, 1997 and 1996, were
$306,474 and $156,705, respectively. AUL may assess a withdrawal charge on
withdrawals that exceed 10% of the participant's account value as of the last
contract anniversary preceding the request for the withdrawal. However, the
contract owner has a right to a full refund of the contributions made under a
contract for any reason within ten days of original contract purchase. The
amount of the withdrawal charge depends upon the number of account years the
participant's account has been in existence, as follows:
Account Year Withdrawal Charge
1 - 5 8%
6 - 10 4%
11 or more 0%
The aggregrate withdrawal charges will not exceed 9% of the contributions made
by or on behalf of a participant under a contract. The charges incurred during
the years ended December 31, 1997 and 1996, were $199,277 and $164,250,
respectively.
17
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NOTES TO FINANCIAL STATEMENTS (continued)
3. Accumulation Unit Value The change in the Accumulation Unit Value per unit
for the year ended December 31, 1997, or from inception of operation, May 1,
1997, through December 31, 1997, is:
12/31/97 12/31/96 Change
Series Fund:
Equity $ 2.696745 $ 2.107103 28.0%
Money Market 1.274444 1.229861 3.6%
Bond 1.719983 1.614937 6.5%
Managed 2.194762 1.837513 19.4%
Fidelity:
High Income 1.680960 1.446567 16.2%
Growth 2.079525 1.705274 21.9%
Overseas 1.524164 1.383489 10.2%
Asset Manager 1.630253 1.368222 19.2%
Index 500 2.284968 1.743597 31.0%
Equity-Income 1.746514 1.380472 26.5%
Contrafund 1.858720 1.516110 22.6%
American Century:
VP Capital
Appreciation 1.170649 1.225326 4.5%
Alger:
American Growth 1.750190 1.409348 24.2%
Calvert:
Capital Accumulation 1.638970 1.342590 22.1%
T. Rowe Price:
Equity Income 1.847792 1.452068 27.3%
12/31/97 5/1/97 Change
Series Fund:
Tactical Asset $ 1.110125 $ 0.982323 13.0%
PBHG:
Growth II 1.066050 1.000000 6.6%
Technology &
Communications 1.032340 1.000000 3.2%
Janus:
Worldwide Growth 1.141625 1.009977 13.0%
Flexible Income 1.083840 0.996134 8.8%
Safeco:
Equity 1.160728 0.983650 18.0%
Growth 1.407808 0.934137 50.7%
18
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
4. Cost of Investments
The cost of Investments at December 31, 1997, is:
Series Fund:
Equity $ 25,679,798
Money Market 7,349,731
Bond 8,568,459
Managed 19,726,300
Tactical Asset 108
Fidelity:
High Income 12,145,069
Growth 46,243,970
Overseas 14,324,559
Asset Manager 42,930,321
Index 500 37,053,469
Equity-Income 10,524,539
Contrafund 14,249,523
American Century:
VP Capital
Appreciation 2,440,947
Alger:
American Growth 17,764,282
Calvert:
Capital
Accumulation $ 1,890,794
T. Rowe Price:
Equity Income 19,222,727
PBHG:
Growth II 64,219
Technology &
Communications 118,460
Janus:
Worldwide Growth 2,438,637
Flexible Income 317,493
Safeco:
Equity 266,704
Growth 1,685,785
5. Net Assets
Net Assets at December 31, 1997, are:
Series Fund Fidelity
------------------------------------------------------- ------------
Equity Money Market Bond Managed Tact. High Income
Asset
Proceeds
from units
sold $33,744,283 $ 62,846,304 $ 12,415,383 $ 24,678,320 $ 100 $ 16,469,854
Cost of
units
redeemed (13,052,100) (55,950,493) (5,187,784) (8,877,164) (6,307,081)
Net investment
income
(loss) 1,694,295 453,920 1,333,027 2,814,761 8 1,379,071
Net realized
gain
(loss) 3,293,320 7,833 1,110,383 603,225
Unrealized
gain
(loss) 8,275,308 (77,542) 4,039,000 3 1,396,818
$ 33,955,106 $ 7,349,731 $ 8,490,917 $ 23,765,300 $ 111 $13,541,887
Fidelity
----------------------------------------------------------------------
Growth Overseas Asset Mgr. Index 500 Equity-Inc. Contrafund
Proceeds
from units
sold $62,834,314 $35,566,301 $53,512,060 $52,826,740 $12,030,080 $17,060,560
Cost of
units
redeemed(24,817,049)(24,218,248)(17,501,851)(21,358,726) (2,299,406) (3,517,855)
Net investment
income
(loss) 2,112,167 830,176 5,873,016 413,029 536,101 57,169
Net realized
gain
(loss) 6,114,538 2,146,330 1,047,096 5,172,426 257,764 649,649
Unrealized
gain
(loss) 8,875,008 (120,547) 7,361,889 4,950,023 1,653,366 2,418,683
$55,118,978 $14,204,012 $50,292,210 $42,003,492 $12,177,905 $16,668,206
19
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
5. Net Assets (continued)
American
Century Alger Calvert T.RowePrice PBHG
------------ ----------- ---------- ----------- ------------------
VP Capital American Capital Tech. &
Appreciation Growth Accumul. Equity Inc. Growth II Comm.
Proceeds
from
units
sold $4,000,036 $30,851,046 $12,364,085 $20,645,739 $86,468 $118,430
Cost of units
redeemed (1,545,589)(15,090,054)(10,914,743) (2,864,132)(21,623) (18)
Net investment
income
(loss) 148,100 (8,240) 162,157 899,986 (286) (414)
Net realized
gain
(loss) (161,600) 2,011,530 279,295 541,134 (340) 463
Unrealized
gain
(loss) (131,247) 1,351,776 (135,750) 2,303,399 (1,874) (13,550)
$ 2,309,700 $19,116,058 $ 1,755,044 21,526,126 $62,345 $104,911
Janus Safeco
--------------------- ---------------------
Worldwide Flexible
Growth Income Equity Growth
Proceeds
from
units sold $ 2,560,652 $ 410,273 $ 212,703 $ 2,041,581
Cost of units
redeemed (121,828) (102,655) (889) (642,558)
Net investment
income (loss) (2,888) 6,976 15,017 237,118
Net realized
gain (loss) 2,701 2,900 (127) 49,644
Unrealized
gain (loss) (10,837) (3,837) (10,581) (180,480)
$ 2,427,800 $ 313,657 $ 216,123 $ 1,505,305
20
