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June 30, 2000 . Pacific Select Fund
. Pacific Corinthian Variable
Separate Account of
Pacific Life Insurance Company
Semi-Annual
Reports
PACIFIC CORINTHIAN
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TABLE OF CONTENTS
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PACIFIC SELECT FUND
<S> <C>
Chairman's Letter................................................... A-1
Performance Discussion.............................................. A-2
Financial Statements:
Statements of Assets and Liabilities.............................. B-1
Statements of Operations.......................................... B-4
Statements of Changes in Net Assets............................... B-7
Financial Highlights................................................ C-1
Schedules of Investments ........................................... D-1
Notes to Financial Statements....................................... E-1
Special Meeting of Shareholders..................................... F-1
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
<S> <C>
Financial Statements:
Statement of Assets and Liabilities............................... G-1
Statement of Operations........................................... G-2
Statement of Changes in Net Assets................................ G-3
Notes to Financial Statements....................................... H-1
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000 (Unaudited)
(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......... $2,879
Equity Portfolio.. $60,204
Bond and Income
Portfolio ........ $9,797
Government
Securities
Portfolio......... $977
Equity Income
Portfolio......... $10,746
Multi-Strategy
Portfolio......... $6,564
Managed Bond
Portfolio......... $276
High Yield Bond
Portfolio......... $152
Equity Index
Portfolio......... $3,823
International
Value Portfolio
(1)............... $1,032
Growth LT
Portfolio......... $10,848
Receivables:
Fund shares
redeemed.......... 2
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Total Assets....... 2,879 60,206 9,797 977 10,746 6,564 276 152 3,823 1,032 10,848
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LIABILITIES
Payables:
Due to Pacific
Life Insurance
Company........... 2
Other liabilities. 6 489 50 2 124 11 7 1 23
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Total Liabilities.. 6 491 50 2 124 11 7 1 23
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NET ASSETS......... $2,873 $59,715 $9,747 $975 $10,622 $6,553 $276 $152 $3,816 $1,031 $10,825
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Shares Owned in
each Portfolio..... 285 1,728 868 95 431 421 26 18 102 59 278
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Cost of
Investments........ $2,864 $25,286 $10,072 $972 $6,414 $5,102 $288 $169 $2,794 $895 $7,990
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</TABLE>
(1) Formerly named International Portfolio.
See Notes to Financial Statements
G-1
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED JUNE 30, 2000 (Unaudited)
(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......... $86 $3,954 $335 $28 $967 $589 $9 $8 $57 $29 $1,665
EXPENSES
Mortality and
expense risk fees
and operating
expenses.......... 19 364 61 6 67 41 2 1 22 5 65
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Net Investment
Income............. 67 3,590 274 22 900 548 7 7 35 24 1,600
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NET REALIZED AND
UNREALIZED GAIN
(LOSS) ON
INVESTMENTS
Net realized gain
(loss) from
security
transactions...... 3 3,538 (57) (5) 637 233 (5) (6) (8) (3) (33)
Net unrealized
appreciation
(depreciation) on
investments....... 1 (7,812) 238 18 (1,786) (780) 8 (4) (76) (39) (2,012)
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Net Realized and
Unrealized Gain
(Loss) on
Investments........ 4 (4,274) 181 13 (1,149) (547) 3 (10) (84) (42) (2,045)
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NET INCREASE
(DECREASE) IN NET
ASSETS RESULTING
FROM OPERATIONS ... $71 ($684) $455 $35 ($249) $1 $10 ($3) ($49) ($18) ($445)
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</TABLE>
See Notes to Financial Statements
G-2
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
STATEMENT OF CHANGES IN NET ASSETS
FOR THE PERIOD ENDED JUNE 30, 2000 (Unaudited)
(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>
INCREASE
(DECREASE) IN NET
ASSETS
FROM OPERATIONS
Net investment
income........... $67 $3,590 $274 $22 $900 $548 $7 $7 $35 $24 $1,600
Net realized gain
(loss) from
security
transactions..... 3 3,538 (57) (5) 637 233 (5) (6) (8) (3) (33)
Net unrealized
appreciation
(depreciation)
on investments... 1 (7,812) 238 18 (1,786) (780) 8 (4) (76) (39) (2,012)
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Net Increase
(Decrease) in Net
Assets
Resulting from Operations. 71 (684) 455 35 (249) 1 10 (3) (49) (18) (445)
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INCREASE
(DECREASE) IN NET
ASSETS
FROM ACCOUNT
TRANSACTIONS
Transfer of net
premiums......... 23 3 5
Transfers between
variable
accounts, net.... (403) (215) (479) (2) (480) (241) (13) (35) 399 383 2,476
Transfers--policy
charges and
deductions....... (17) (370) (72) (11) 18 (101)
Transfers--
surrenders....... (136) (5,192) (1,058) (241) (950) (721) (17) (2) (138) (120) (484)
Transfers--other. 9 (1) 1 (1)
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Net Increase
(Decrease) in Net
Assets Derived
from Account
Transactions...... (556) (5,745) (1,607) (243) (1,429) (963) (30) (37) 250 281 1,896
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NET INCREASE
(DECREASE) IN NET
ASSETS............ (485) (6,429) (1,152) (208) (1,678) (962) (20) (40) 201 263 1,451
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NET ASSETS
Beginning of
Period........... 3,358 66,144 10,899 1,183 12,300 7,515 296 192 3,615 768 9,374
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End of Period.... $2,873 $59,715 $9,747 $975 $10,622 $6,553 $276 $152 $3,816 $1,031 $10,825
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</TABLE>
See Notes to Financial Statements
G-3
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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
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<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 (1)
Transfer of net
premiums.......... 51 3 10 9 5 8 19
Transfers between
variable accounts,
net............... (62) (537) (507) 38 (187) (192) 77 (39) 592 18 3,044
Transfers--policy
charges and
deductions........ (586) (5,646) (3,391) (42) (1,020) (1,411) (32) (58) (260) (89) (359)
Transfers--
surrenders........ (323) (5,064) (305) (1) (2,486) (191) (32) (33) (184) (11) (717)
Transfers--other.. (1) (182) (10) (23) (4) (2) (1) (14)
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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>
(1) This section has been reclassified to conform with current year
presentation.
See Notes to Financial Statements
G-4
<PAGE>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
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:
Portfolios
----------
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 Value Portfolio*
Variable Account XIV Growth LT Portfolio
* Formerly named International Portfolio.
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 and Investment Income
Transactions are recorded on the trade date. Realized gains and losses on
sales of investments are determined on the basis of identified cost. Dividend
income is recorded on the ex-dividend date.
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 the six-month period ended June 30, 2000, 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.
H-1
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PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (Continued)
(Unaudited)
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.
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 Select Distributors, Inc. (formerly 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 period ended June 30, 2000
were as follows:
<TABLE>
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<CAPTION>
Accumulation
Unit Value
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At Number of Units
Begin- At End Outstanding
Variable ning of of at End of
Accounts Period Period Period
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<S> <C> <C> <C>
I $2.042 $2.088 1,375,738
II 10.716 10.631 5,616,834
III 4.395 4.591 2,123,103
IV 2.075 2.151 453,345
VII 3.582 3.515 3,021,774
IX 2.722 2.729 2,401,734
X 1.366 1.418 194,733
XI 1.409 1.385 109,452
XII 3.203 3.167 1,205,103
XIII 1.816 1.759 585,736
XIV 5.103 4.934 2,193,976
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</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>
PACIFIC CORINTHIAN VARIABLE SEPARATE ACCOUNT
NOTES TO FINANCIAL STATEMENTS (Continued)
(Unaudited)
7. SEPARATE ACCOUNT'S COST OF INVESTMENTS IN THE FUNDS SHARES
The investment in the Fund shares are carried at identified cost, which
represents the amount available for investment (including reinvested
distributions of net investment income and realized gains) in such shares after
deduction of mortality and expense risk and administrative charges (M&E). Total
cost and market value of the Separate Account's investments in the Fund as of
June 30, 2000 were as follows (amounts in thousands):
<TABLE>
<CAPTION>
Variable Accounts
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Variable Variable Variable Variable Variable Variable
Account Account Account Account Account Account
I II III IV VII IX
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<S> <C> <C> <C> <C> <C> <C>
Total cost of invest-
ments at beginning of
period $3,350 $23,904 $11,461 $1,197 $6,308 $5,283
Add: Total net proceeds
from policy and M&E
transactions 728 586 13 35 28 47
Reinvested distribu-
tions from the Fund:
(a) Net investment in-
come 86 4 335 28 48 93
(b) Net realized gain 3,950 919 496
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Sub-Total 4,164 28,444 11,809 1,260 7,303 5,919
Less: Cost of invest-
ments disposed during
the period 1,300 3,158 1,737 288 889 817
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Total cost of invest-
ments at end of period 2,864 25,286 10,072 972 6,414 5,102
Add: Unrealized appreci-
ation (depreciation) 15 34,918 (275) 5 4,332 1,462
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Total market value of
investments at end of
period $2,879 $60,204 $9,797 $977 $10,746 $6,564
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<CAPTION>
Variable Variable Variable Variable Variable
Account Account Account Account Account
X XI XII XIII XIV
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<S> <C> <C> <C> <C> <C>
Total cost of invest-
ments at beginning of
period $316 $205 $2,516 $594 $4,527
Add: Total net proceeds
from policy and M&E
transactions 21 4 891 393 2,455
Reinvested distribu-
tions from the Fund:
(a) Net investment
income 9 8 18 25
(b) Net realized
gain 39 29 1,640
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Sub-Total 346 217 3,464 1,016 8,647
Less: Cost of invest-
ments disposed during
the period 58 48 670 121 657
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Total cost of invest-
ments at end of period 288 169 2,794 895 7,990
Add: Unrealized appreci-
ation (depreciation) (12) (17) 1,029 137 2,858
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Total market value of
investments at end of
period $276 $152 $3,823 $1,032 $10,848
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</TABLE>
H-3
