<PAGE>
December 31, 1999 . Pacific Select Fund
. Pacific Corinthian Variable
Separate Account of
Pacific Life Insurance Company
Annual
Report
[GRAPHIC]
Pacific Corinthian
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PACIFIC SELECT FUND
<S> <C>
Chairman's Letter................................................... A-1
Performance Discussion.............................................. A-2
Independent Auditors' Report........................................ B-1
Financial Statements:
Statements of Assets and Liabilities.............................. B-2
Statements of Operations.......................................... B-4
Statements of Changes in Net Assets............................... B-6
Financial Highlights................................................ C-1
Schedules of Investments and Notes.................................. D-1
Notes to Financial Statements....................................... E-1
Special Meeting of Shareholders..................................... F-1
<CAPTION>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
<S> <C>
Independent Auditors' Report........................................ G-1
Financial Statements:
Statement of Assets and Liabilities............................... G-2
Statement of Operations........................................... G-3
Statement of Changes in Net Assets................................ G-4
Notes to Financial Statements....................................... H-1
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Pacific Life Insurance Company:
We have audited the accompanying statement of assets and liabilities of
Pacific Corinthian Variable Separate Account (comprised of Variable Accounts
I, II, III, IV, VII, IX, X, XI, XII, XIII, and XIV) as of December 31, 1999
and the related statement of operations for the year then ended and the
statement of changes in net assets for each of the two years then ended. These
financial statements are the responsibility of the Separate Account'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. 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, such financial statements present fairly, in all material
respects, the financial position of each of the respective Variable Accounts
constituting Pacific Corinthian Variable Separate Account as of December 31,
1999 and the results of their operations for the year then ended and the
changes in their net assets for each of the two years then ended, in
conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Costa Mesa, California
February 4, 2000
G-1
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account Account Account
I II III IV VII IX X XI XII XIII XIV
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments in
Pacific Select
Fund:
Money Market
Portfolio
(334 shares; cost
$3,350)........... $3,364
Equity Portfolio
(1,777 shares;
cost $23,904)..... $66,634
Bond and Income
Portfolio
(986 shares; cost
$11,461).......... $10,948
Government
Securities
Portfolio
(117 shares; cost
$1,197)........... $1,185
Equity Income
Portfolio
(448 shares; cost
$6,308)........... $12,426
Multi-Strategy
Portfolio
(443 shares; cost
$5,283)........... $7,525
Managed Bond
Portfolio
(29 shares; cost
$316)............. $297
High Yield Bond
Portfolio
(22 shares; cost
$205)............. $193
Equity Index
Portfolio
(94 shares; cost
$2,516)........... $3,621
International
Portfolio
(42 shares; cost
$594)............. $770
Growth LT
Portfolio
(197 shares; cost
$4,527)........... $9,397
Receivables:
Due from Pacific
Life Insurance
Company........... 32
Fund shares
redeemed.......... 30 10 1 6 6 2 1 13
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Total Assets....... 3,396 66,664 10,958 1,186 12,432 7,531 297 193 3,623 771 9,410
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LIABILITIES
Payables:
Due to Pacific
Life Insurance
Company........... 30 10 1 6 6 2 1 13
Fund shares
purchased......... 32
Other liabilities. 6 490 49 2 126 10 1 1 6 2 23
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Total Liabilities.. 38 520 59 3 132 16 1 1 8 3 36
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NET ASSETS......... $3,358 $66,144 $10,899 $1,183 $12,300 $7,515 $296 $192 $3,615 $768 $9,374
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</TABLE>
See Notes to Financial Statements
G-2
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account Account Account
I II III IV VII IX X XI XII XIII XIV
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends........ $165 $4,420 $1,336 $75 $1,299 $681 $28 $21 $50 $29 $374
EXPENSES
Mortality and
expense risk fees
and operating
expenses......... 43 719 153 14 164 95 4 3 38 8 63
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Net Investment
Income............ 122 3,701 1,183 61 1,135 586 24 18 12 21 311
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NET REALIZED AND
UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain
(loss) from
security
transactions..... 1 4,583 163 (2) 1,261 388 (9) (13) 33 (4) 35
Net unrealized
appreciation
(depreciation)
on investments... 9 11,036 (2,536) (97) (851) (521) (26) (1) 516 109 3,650
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Net Realized and
Unrealized Gain
(Loss)
on Investments.... 10 15,619 (2,373) (99) 410 (133) (35) (14) 549 105 3,685
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NET INCREASE
(DECREASE) IN NET
ASSETS
RESULTING FROM OPERATIONS. $132 $19,320 ($1,190) ($38) $1,545 $453 ($11) $4 $561 $126 $3,996
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</TABLE>
See Notes to Financial Statements
G-3
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1999
(In thousands)
<TABLE>
<CAPTION>
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account Account Account
I II III IV VII IX X XI XII XIII XIV
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE
(DECREASE) IN NET
ASSETS
FROM OPERATIONS
Net investment
income........... $122 $3,701 $1,183 $61 $1,135 $586 $24 $18 $12 $21 $311
Net realized gain
(loss) from
security
transactions..... 1 4,583 163 (2) 1,261 388 (9) (13) 33 (4) 35
Net unrealized
appreciation
(depreciation)
on investments... 9 11,036 (2,536) (97) (851) (521) (26) (1) 516 109 3,650
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Net Increase
(Decrease) in Net
Assets
Resulting from Operations. 132 19,320 (1,190) (38) 1,545 453 (11) 4 561 126 3,996
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INCREASE
(DECREASE) IN NET
ASSETS
FROM ACCOUNT TRANSACTIONS
Transfers in..... 1,460 840 602 135 435 106 172 42 1,214 135 3,289
Transfers out.... (2,432) (12,218) (4,812) (140) (4,141) (1,895) (154) (172) (1,060) (218) (1,316)
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Net Increase
(Decrease) in Net
Assets Derived
from Account Transactions. (972) (11,378) (4,210) (5) (3,706) (1,789) 18 (130) 154 (83) 1,973
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NET INCREASE
(DECREASE) IN NET
ASSETS............ (840) 7,942 (5,400) (43) (2,161) (1,336) 7 (126) 715 43 5,969
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NET ASSETS
Beginning of
Year............. 4,198 58,202 16,299 1,226 14,461 8,851 289 318 2,900 725 3,405
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End of Year...... $3,358 $66,144 $10,899 $1,183 $12,300 $7,515 $296 $192 $3,615 $768 $9,374
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</TABLE>
See Notes to Financial Statements
G-4
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1998
(In thousands)
<TABLE>
<CAPTION>
Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account Account Account Account Account Account
I II III IV VII IX X XI XII XIII XIV
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
INCREASE
(DECREASE) IN NET
ASSETS
FROM OPERATIONS
Net investment
income........... $147 $3,147 $863 $73 $1,663 $958 $14 $26 $23 $56 $75
Net realized gain
(loss) from
security
transactions..... 5 12,281 788 2 1,387 1,316 1 (16) 98 (12) 14
Net unrealized
appreciation
(depreciation)
on investments... (5) 451 (331) 22 (17) (635) 4 (15) 457 (19) 1,025
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Net Increase
(Decrease) in Net
Assets Resulting
from Operations... 147 15,879 1,320 97 3,033 1,639 19 (5) 578 25 1,114
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INCREASE
(DECREASE) IN NET
ASSETS
FROM ACCOUNT TRANSACTIONS
Transfers in..... 3,034 240 674 139 958 457 189 215 1,955 230 1,273
Transfers out.... (3,070) (28,424) (8,700) (227) (5,809) (6,050) (112) (192) (1,178) (404) (628)
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Net Increase
(Decrease) in Net
Assets Derived
from Account Transactions. (36) (28,184) (8,026) (88) (4,851) (5,593) 77 23 777 (174) 645
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NET INCREASE
(DECREASE) IN NET
ASSETS............ 111 (12,305) (6,706) 9 (1,818) (3,954) 96 18 1,355 (149) 1,759
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NET ASSETS
Beginning of
Year............. 4,087 70,507 23,005 1,217 16,279 12,805 193 300 1,545 874 1,646
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End of Year...... $4,198 $58,202 $16,299 $1,226 $14,461 $8,851 $289 $318 $2,900 $725 $3,405
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</TABLE>
See Notes to Financial Statements
G-5
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
Pacific Corinthian Variable Separate Account (the "Separate Account") of
Pacific Life Insurance Company ("Pacific Life") is a separate investment
account originally established by a resolution of the Board of Directors of
Pacific Corinthian Life Insurance Company ("PCL").
PCL, formerly a wholly owned subsidiary of Pacific Life, was a stock life
insurance company organized under the laws of the State of California.
PCL was formed to rehabilitate the business of First Capital Life Insurance
Company ("FCL") under a five-year rehabilitation plan ("the Plan"). Under the
terms of the Plan, FCL's insurance policies in force, primarily individual
annuities and universal life insurance, were restructured and assumed by PCL
on December 31, 1992, pursuant to an assumption reinsurance agreement and
asset purchase agreement. On September 30, 1997, PCL completed the Plan of
FCL. On October 30, 1997, PCL was merged into Pacific Life, with Pacific Life
as the surviving entity. The Separate Account remained intact and became a
Separate Account of Pacific Life.
The Separate Account held by Pacific Life represents funds from individual
flexible premium deferred annuity and variable accumulation contracts. The
assets of the Separate Account are carried at market value.
The Separate Account which operates as a unit investment trust under the
Investment Company Act of 1940, as amended, is divided into subaccounts
("Variable Accounts"). The assets in each Variable Account are invested in
shares of the corresponding portfolios of Pacific Select Fund (the "Fund") as
follows:
<TABLE>
<CAPTION>
Portfolios
----------
<S> <C>
Variable Account I Money Market Portfolio
Variable Account II Equity Portfolio
Variable Account III Bond and Income Portfolio
Variable Account IV Government Securities Portfolio
Variable Account VII Equity Income Portfolio
Variable Account IX Multi-Strategy Portfolio
Variable Account X Managed Bond Portfolio
Variable Account XI High Yield Bond Portfolio
Variable Account XII Equity Index Portfolio
Variable Account XIII International Portfolio
Variable Account XIV Growth LT Portfolio
</TABLE>
Each Variable Account pursues different investment objectives and policies.
The financial statements of the Fund, including the schedules of investments,
are included in Sections B through E of this report and should be read in
conjunction with the Separate Account's financial statements.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of the accompanying financial statements 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 income and expenses during the reporting period. Actual results
could differ from those estimates.
A. Valuation of Investments
Investments in shares of the Fund are valued at the reported net asset values
of the respective portfolios. Valuation of securities held by the Fund is
discussed in the notes to its financial statements.
B. Security Transactions
Transactions are recorded on the trade date. Realized gains and losses on
sales of investments are determined on the basis of identified cost.
C. Federal Income Taxes
The operations of the Separate Account will be reported on the Federal income
tax return of Pacific Life, which is taxed as a life insurance company under
the provisions of the Tax Reform Act of 1986. Under current tax law, no
Federal income taxes are expected to be paid by Pacific Life with respect to
the operations of the Separate Account.
3. DIVIDENDS
During 1999, the Fund declared dividends for each portfolio invested by the
Separate Account. The amounts accrued by the Separate Account for its share of
the dividends were reinvested in additional full and fractional shares of the
related portfolio.
4. CONTRACT CHARGES
A contingent deferred sales charge may be deducted upon partial or complete
withdrawal or upon annuitization of a Contract.
An annual contract maintenance charge of $30 is imposed on all Contracts on
December 31 of each year. The charge covers the cost of Contract
administration and is apportioned equally among the Accounts to which the
Contract Value is allocated.
Mortality and expense risks assumed by Pacific Life are compensated for by a
charge equivalent to an annual rate of 1.19% of the value of each Variable
Account's net assets of which approximately 1.00% is for assuming mortality
risks and 0.19% is for assuming expense risks.
H-1
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (Continued)
In addition, the Separate Account bears certain of its operating expenses,
subject to Pacific Life's guarantee that such expenses will not exceed 0.25%
of each Variable Account's average daily net assets annually. Pacific Life
further guarantees that the ordinary operating expenses of a Variable Account
together with the operating expenses incurred by its underlying Fund
Portfolio, exclusive of advisory and management fees, interest, taxes,
brokerage commissions, transaction costs or extraordinary expenses, will not
exceed 0.6% of average daily net assets annually after consideration for any
adjustment by the Fund's Investment Adviser for Fund expenses in excess of
stated expense limitations, except that additional custodial costs associated
with holding foreign securities and foreign taxes on dividends, interests and
gains will also be excluded with respect to the underlying International
Portfolio of the Fund.
5. RELATED PARTY AGREEMENT
Pacific Mutual Distributors, Inc., a wholly-owned subsidiary of Pacific Life,
serves as principal underwriter of variable annuity contracts funded by
interests in the Separate Account, without remuneration from the Separate
Account.
6. SELECTED ACCUMULATION UNIT** INFORMATION
Selected accumulation unit information for the year ended December 31, 1999
were as follows:
<TABLE>
<CAPTION>
Accumulation
Unit Value
--------------
Number of
At Units
Begin- At End Outstanding
Variable ning of of at End of
Accounts Year Year Year
- --------------------------------------
<S> <C> <C> <C>
I $1.969 $2.042 1,644,847
II 7.828 10.716 6,172,599
III 4.800 4.395 2,480,156
IV 2.142 2.075 570,009
VII 3.201 3.582 3,433,458
IX 2.574 2.722 2,760,819
X 1.409 1.366 217,035
XI 1.386 1.409 136,498
XII 2.688 3.203 1,128,319
XIII 1.496 1.816 422,900
XIV 2.607 5.103 1,837,058
</TABLE>
** Accumulation Unit: unit of measure used to calculate the value of a Contract
Owner's interest in a Variable Account during the Accumulation Period.
----------------------
H-2
<PAGE>
Annual Reports
as of December 31, 1999
. Pacific Select Fund
. Pacific Corinthian Variable
Separate Account of
Pacific Life Insurance Company
Accountants
Deloitte & Touche LLP
695 Town Center Drive
Suite 1200
Costa Mesa, CA 92626
Counsel
Dechert Price & Rhoads
1775 Eye Street, N.W.
Washington, D.C. 20006-2401
Pacific Life Insurance Company
Variable Annuity Department
P.O. Box 7187
Pasadena, California 91109-7187
ADDRESS SERVICE REQUESTED
Form No. 1001-0A
