<PAGE>
[LOGO] CANADA LIFE RONALD E. BEETTAM, F.S.A., F.C.I.A.
President
Canada Life Insurance Company
of America
P.O. Box 105662
Atlanta, GA 30348-5662
(770) 953-1959, x2861
(800) 905-1959
FAX: (800) 670-4836
August, 1999
Dear Trillium Policyholder:
Enclosed is the Trillium Semi-Annual Report for the period ending June
30, 1999. We encourage you to review this information and to refer to it
as needed throughout the year.
Please call your Registered Representative or Canada Life if you have any
questions.
Thank you for selecting Trillium for your financial needs.
Sincerely,
Ronald E. Beettam
Encl.
<PAGE>
TRILLIUM(R) [LOGO] CANADA LIFE
A Variable Annuity INSURANCE COMPANY OF AMERICA
P.O. Box 105662
Atlanta, GA 30348-5662
(800) 905-1959
ADDITIONAL PREMIUM PAYMENT FORM
Please complete the following information:
OWNER: AMOUNT OF PREMIUM PAYMENT
ANNUITANT: $____________
POLICY NO.:
OWNER'S SSN/TIN: IF YOU ARE CHANGING ALLOCATION
PLEASE COMPLETE THE FOLLOWING:
________ THIS PAYMENT ONLY
________ THIS PAYMENT AND ALL FUTURE PYMTS
________ RE-ALLOCATE ALL CURRENT ASSETS
CASH MGMT (21) ____% INCOME (22) ____% SMALL-CAP VALUE (44)____%
BOND (23) ____% COM STOCK (24) ____% LARGE-CAP VALUE (45) ____%
CAPITAL (25) ____% INTERNATIONAL (26) ____% LARGE-CAP GROWTH (281)____%
COMM & INFO (27) ____% GBL GROWTH OPP (28)____%
GBL SMLR CO (29) ____% FRONTIER (41) ____%
HIGH YLD BOND (42)____% GLOBAL TECH (43) ____%
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Fixed Account Options*
<S> <C> <C> <C> <C>
% 1 Yr. (201) % 3 Yr. (203) % 5 Yr. (205) % 7 Yr. (207) % 10 Yr. (210)
- ----- ------- ------ --------- ---------
*The Fixed Accounts and/or the Guarantee Periods may not be available in all states.
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
Total allocation must equal 100%
OWNER'S SIGNATURE ___________________________ DATE _______________
JOINT OWNER'S SIGNATURE ___________________________ DATE _______________
PLEASE MAKE CHECKS PAYABLE TO CANADA LIFE INSURANCE COMPANY OF AMERICA
INFORMATION FOR QUALIFIED POLICY CONTRIBUTIONS
(THIS SECTION MUST BE COMPLETED)
IS THIS A ROLLOVER? _____YES _____NO
IF YES, WHAT TYPE? ______________________ PLEASE NOTE: CONTRIBUTIONS FOR PRIOR
TAX YEAR CANNOT BE MADE
CONTRIBUTION $___________ FOR __________ AFTER APRIL 15TH OF THE
CURRENT TAX YEAR.
CONTRIBUTION $___________ FOR __________
PLEASE DIRECT ANY QUESTIONS REGARDING YOUR POLICY TO YOUR REGISTERED
REPRESENTATIVE OR TO OUR VARIABLE ANNUITY DEPARTMENT AT (800) 905-1959.
Our Variable Annuity Administrators can not advise you on the suitability of
your payment. Please contact your Registered Representative to discuss
suitability issues prior to submitting your additional premium payment.
Variable Annuities are issued by Canada Life Insurance Company of America and
offered through its subsidiary, Canada Life of America Financial Services,
Inc. (member NASD).
<PAGE>
- -------------------------------------------------------------------------------
MID-YEAR REPORT
- -------------------------------------------------------------------------------
TRILLIUM
A VARIABLE
ANNUITY
[GRAPHICS]
June 30, 1999
- -------------------------------------------------------------------------------
TOTAL RETURNS*
For the Six Months Ended June 30, 1999
SUB-ACCOUNTS:
Bond ............................................................... (5.00)%
Capital ............................................................ 7.52
Cash Management .................................................... 1.65
Common Stock ....................................................... 9.92
Communications and Information ..................................... 20.11
Frontier ........................................................... (6.70)
Global Growth Opportunities ........................................ 13.54
Global Smaller Companies ........................................... 1.42
Global Technology .................................................. 25.34
International ...................................................... 3.77
High-Yield Bond .................................................... (0.51)
Income ............................................................. (0.06)
Large-Cap Growth ................................................... 3.96**
Large-Cap Value .................................................... 10.41
Small-Cap Value .................................................... 42.51
- --------------------
* Total returns of the Sub-Accounts are based on the performance of the
Seligman Portfolios, Inc., the underlying investment vehicle for the Canada
Life of America Variable Annuity Account 2 (Variable Annuity Account 2),
less current fees and charges. The returns exclude any contingent deferred
sales charge ("CDSC") applicable to the Variable Annuity Account 2.
** From commencement of operations, April 30, 1999.
SELIGMAN PORTFOLIOS, INC.
THE UNDERLYING INVESTMENT VEHICLE FOR
- -------------------------------------------------------------------------------
TRILLIUM
A VARIABLE
ANNUITY
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
August 6, 1999
Dear Contract Owner:
J. & W. Seligman & Co. Incorporated (Seligman), as Manager of Seligman
Portfolios, Inc. (the Fund), the underlying investment vehicle for your Trillium
Variable Annuity, and Canada Life Insurance Company of America, as issuer of The
Canada Life of America Variable Annuity Account 2, are pleased to provide the
enclosed unaudited report for the six months ended June 30, 1999.
Over the past six months, the global economic outlook continued to improve
and the US economy entered its ninth year of expansion. With this sustained
growth in America, several inflation indicators finally began showing modest
cautionary signals, causing the Federal Reserve Board to raise the federal funds
rate by 25 basis points in June. Following the Fed's meeting, common stock
prices rallied. International equity indices also generally rose in keeping with
the developing global growth backdrop. Fixed-income instruments, however,
experienced price declines as a result of rising interest rates.
Looking ahead, we believe that US economic growth will continue, but that the
pace will moderate, in keeping with the Fed's intentions. For that matter, the
Fed may raise interest rates further if inflation indicators move higher in any
sustained fashion. We expect that the world economy will continue to recover and
to grow. In such an environment, US and international equities are likely to
perform well. Further, we believe that once interest rates reflect the Fed
adjustments, fixed-income obligations will begin moving within a trading range.
As the millennium approaches, we have become concerned that the media's focus
on the Year 2000 (Y2K) computer issue, and the fears that this attention may
spark, will cause some investors to take actions that are not in their best
long-term interests. In our view, the primary danger to investors is losing
sight of their long-term financial goals and altering their portfolios and asset
allocations in an attempt to respond to the confusion surrounding this issue. In
the US, governments and businesses have committed substantial resources to this
issue and, while there may be scattered inconveniences, we believe that the US
will enter the year 2000 relatively seamlessly, and that much of the rest of the
developed world is also well positioned to deal with the new millennium.
For the past several years, Seligman has been working to ensure that
shareholders do not experience any Y2K-related inconveniences. We are pleased to
report that the early start has paid off. During the spring of this year,
Seligman participated in Y2K testing conducted by the Securities Industry
Association. These tests were completed without any Y2K-related problems on the
part of Seligman. Tests with key service providers were also conducted, all of
which were successfully completed in a Y2K environment.
Thank you for your continued support of Trillium. We look forward to serving
your investment needs for many years to come.
Respectfully,
/s/ Ronald E. Beettam /s/ William C. Morris
Ronald E. Beettam William C. Morris
President Chairman
Canada Life Insurance Company of America J. & W. Seligman & Co. Incorporated
1
<PAGE>
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
- -------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GLOBAL
CASH COMMON COMMUNICATIONS GROWTH
BOND CAPITAL MANAGEMENT STOCK AND INFORMATION FRONTIER OPPORTUNITIES
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
----------- ------------- ----------- ------------ -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSETS:
Investment in Seligman
Portfolios, Inc., at market value
(see Note 3 for cost values) .........$5,095,997 $19,763,384 $15,907,804 $47,968,368 $114,948,741 $21,637,600 $8,958,392
Due from (to) Canada Life
Insurance Company of
America (Note 6) ..................... (551) 11,016 31,172 16,174 5,941 4,678 (167)
---------- ----------- ----------- ----------- ------------ ----------- ----------
NET ASSETS ...........................$5,095,446 $19,774,400 $15,938,976 $47,984,542 $114,954,682 $21,642,278 $8,958,225
========== =========== =========== =========== ============ =========== ==========
NET ASSETS ATTRIBUTABLE TO:
Policyholders' liability reserve .....$5,095,446 $19,774,400 $15,938,976 $47,984,542 $114,954,682 $21,642,278 $8,958,225
---------- ----------- ----------- ----------- ------------ ----------- ---------
NET ASSETS ...........................$5,095,446 $19,774,400 $15,938,976 $47,984,542 $114,954,682 $21,642,278 $8,958,225
========== =========== =========== =========== ============ =========== ==========
NUMBER OF UNITS OUTSTANDING .......... 307,755 495,484 10,809,621 1,088,741 3,895,296 1,235,725 604,676
---------- ----------- ----------- ----------- ------------ ----------- ---------
NET ASSET VALUE PER UNIT .............$ 16.5568 $ 39.9093 $ 1.4745 $ 44.0734 $ 29.5112 $ 17.5138 $ 14.8149
========== =========== =========== =========== ============ =========== ==========
</TABLE>
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (UNAUDITED)
- -------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
CASH
BOND CAPITAL MANAGEMENT
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
----------- ------------ -----------
<S> <C> <C> <C>
NET INVESTMENT INCOME:
Dividend and capital
gain distributions ........................ $ -- $ -- $ 198,783
Less mortality and expense risk
charges (Note 6) .......................... 37,512 124,805 78,402
------------ ------------ -----------
NET INVESTMENT INCOME (LOSS) .............. (37,512) (124,805) 120,381
------------ ------------ -----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss)
on investments ............................ (47,647) 402,684 --
Net unrealized appreciation
(depreciation) of investments ............. (184,552) 1,131,735 --
------------ ------------ -----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) OF INVESTMENTS ................ (232,199) 1,534,419 --
------------ ------------ -----------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS ........................... $ (269,711) $ 1,409,614 $ 120,381
============= ============ ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GLOBAL
COMMON COMMUNICATIONS GROWTH
STOCK AND INFORMATION FRONTIER OPPORTUNITIES
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
------------ --------------- ----------- --------------
<S> <C> <C> <C> <C>
NET INVESTMENT INCOME:
Dividend and capital
gain distributions ........................ $ -- $ -- $ -- $ --
Less mortality and expense risk
charges (Note 6) .......................... 310,901 700,214 170,618 56,346
----------- ------------ ------------ -----------
NET INVESTMENT INCOME (LOSS) .............. (310,901) (700,214) (170,618) (56,346)
----------- ------------ ------------ -----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss)
on investments ............................ 943,109 2,659,472 (1,255,752) 236,969
Net unrealized appreciation
(depreciation) of investments ............. 3,661,452 17,406,322 (1,391,255) 880.072
----------- ------------ ------------ -----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) OF INVESTMENTS ................ 4,604,561 20,065,794 (2,647,007) 1,117,041
----------- ------------ ------------ -----------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS ........................... $ 4,293,660 $ 19,365,580 $ (2,817,625) $ 1,060,695
=========== ============ ============ ===========
</TABLE>
- ----------------------
* For the period May 1, 1999 (commencement of operations) to June 30, 1999.
See accompanying notes.
2
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
June 30, 1999
- -------------------------------------------------------------------------------
GLOBAL
SMALLER GLOBAL HIGH-YIELD LARGE-CAP LARGE-CAP SMALL-CAP
COMPANIES TECHNOLOGY INTERNATIONAL BOND INCOME GROWTH VALUE VALUE SUB-ACCOUNTS
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT COMBINED
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$16,612,560 $ 8,157,951 $ 8,975,918 $25,820,691 $ 8,259,043 $ 1,597,344 $ 6,103,413 $ 4,857,405 $314,664,611
91,630 102 6,977 (427) 105 3,460 3,328 (181) 173,257
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
$16,704,190 $ 8,158,053 $ 8,982,895 $25,820,264 $ 8,259,148 $ 1,600,804 $ 6,106,741 $ 4,857,224 $314,837,868
=========== =========== =========== =========== =========== =========== =========== =========== ============
$16,704,190 $ 8,158,053 $ 8,982,895 $25,820,264 $ 8,259,148 $ 1,600,804 $ 6,106,741 $ 4,857,224 $314,837,868
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ------------
$16,704,190 $ 8,158,053 $ 8,982,895 $25,820,264 $ 8,259,148 $ 1,600,804 $ 6,106,741 $ 4,857,224 $314,837,868
=========== =========== =========== =========== =========== =========== =========== =========== ============
1,106,142 398,345 546,394 1,916,705 362,590 153,988 559,781 414,535 23,895,778
=========== =========== =========== =========== =========== =========== =========== =========== ============
$ 15.1013 $ 20.4799 $ 16.4403 $ 13.4712 $ 22.7782 $ 10.3956 $ 10.9092 $ 11.7173
=========== =========== =========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
For the Six Months Ended June 30, 1999
- -------------------------------------------------------------------------------
GLOBAL
SMALLER GLOBAL HIGH-YIELD LARGE-CAP LARGE-CAP SMALL-CAP
COMPANIES TECHNOLOGY INTERNATIONAL BOND INCOME GROWTH VALUE VALUE SUB-ACCOUNTS
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT COMBINED
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ -- $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ 198,783
119,486 45,751 63,847 220,927 60,177 1,615 32,252 22,850 2,045,703
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
(119,486) (45,751) (63,847) (220,927) (60,177) (1,615) (32,252) (22,850) (1,846,920)
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(53,762) 625,475 202,518 (644,816) (1,146) 444 35,122 47,064 3,149,734
195,753 1,060,452 231,115 735,034 63,027 100,218 533,005 1,263,434 25,685,812
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
141,991 1,685,927 433,633 90,218 61,881 100,662 568,127 1,310,498 28,835,546
- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
$ 22,505 $ 1,640,176 $ 369,786 $ (130,709) $ 1,704 $ 99,047 $ 535,875 $1,287,648 $26,988,626
=========== =========== =========== =========== =========== =========== ========== ========== ===========
</TABLE>
3
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
- -------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
BOND CAPITAL CASH MANAGEMENT
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
---------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR ENDED YEAR
6/30/99 ENDED 6/30/99 ENDED 6/30/99 ENDED
(unaudited) 12/31/98 (unaudited) 12/31/98 (unaudited) 12/31/98
----------- -------- ----------- --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ................ $ (37,512) $ 261,254 $ (124,805) $ 792,674 $ 120,381 $ 339,212
Net realized gain (loss) on investments ..... (47,647) 75,857 402,684 640,187 -- --
Net unrealized appreciation/
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
depreciation of investments ................. (184,552) (24,918) 1,131,735 1,474,942 -- --
---------- ---------- ----------- ----------- ----------- ----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS ............ (269,711) 312,193 1,409,614 2,907,803 120,381 339,212
---------- ---------- ----------- ----------- ----------- ----------
CAPITAL TRANSACTIONS:
Net increase (decrease) from
unit transactions (Note 5) .................. 92,245 6,780 347,176 123,897 6,855,685 1,240,131
---------- ---------- ----------- ----------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS
ARISING FROM CAPITAL TRANSACTIONS ........... 92,245 6,780 347,176 123,897 6,855,685 1,240,131
---------- ---------- ----------- ----------- ----------- ----------
TOTAL INCREASE (DECREASE) IN NET ASSETS ..... (177,466) 318,973 1,756,790 3,031,700 6,976,066 1,579,343
Net Assets, Beginning of Period ............. 5,272,912 4,953,939 18,017,610 14,985,910 8,962,910 7,383,567
---------- ---------- ----------- ----------- ----------- ----------
NET ASSETS, END OF PERIOD ................... $5,095,446 $5,272,912 $19,774,400 $18,017,610 $15,938,976 $8,962,910
========== ========== =========== =========== =========== ==========
</TABLE>
<TABLE>
<CAPTION>
GLOBAL TECHNOLOGY INTERNATIONAL HIGH-YIELD BOND
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT
----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR ENDED YEAR
6/30/99 ENDED 6/30/99 ENDED 6/30/99 ENDED
(unaudited) 12/31/98 (unaudited) 12/31/98 (unaudited) 12/31/98
---------- --------- ---------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) ................ $ (45,751) $ 168,834 $ (63,847) $ 52,265 $ (220,927) $ 2,241,555
Net realized gain (loss) on investments ..... 625,475 119,124 202,518 302,886 (644,816) 242,702
Net unrealized appreciation/
depreciation of investments ................. 1,060,452 960,333 231,115 852,183 735,034 (2,787,854)
---------- ---------- ---------- ---------- ----------- -----------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS ............ 1,640,176 1,248,291 369,786 1,207,334 (130,709) (303,597)
---------- ---------- ---------- ---------- ----------- -----------
CAPITAL TRANSACTIONS:
Net increase (decrease) from
unit transactions (Note 5) .................. 1,246,842 729,244 (754,380) (645,302) (4,914,228) 8,452,975
---------- ---------- ---------- ---------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
ARISING FROM CAPITAL TRANSACTIONS ........... 1,246,842 729,244 (754,380) (645,302) (4,914,228) 8,452,975
---------- ---------- ---------- ---------- ----------- -----------
TOTAL INCREASE (DECREASE) IN NET ASSETS ..... 2,887,018 1,977,535 (384,594) 562,032 (5,044,937) 8,149,378
Net Assets, Beginning of Period ............. 5,271,035 3,293,500 9,367,489 8,805,457 30,865,201 22,715,823
---------- ---------- ---------- ---------- ----------- -----------
NET ASSETS, END OF PERIOD ................... $8,158,053 $5,271,035 $8,982,895 $9,367,489 $25,820,264 $30,865,201
========== ========== ========== ========== ============ ===========
</TABLE>
- ------------
* Commencement of operations.
See accompanying notes.
4
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
<TABLE>
<CAPTION>
COMMON STOCK COMMUNICATIONS AND FRONTIER
SUB-ACCOUNT INFORMATION SUB-ACCOUNT SUB-ACCOUNT
---------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR ENDED YEAR
6/30/99 ENDED 6/30/99 ENDED 6/30/99 ENDED
(UNAUDITED) 12/31/98 (UNAUDITED) 12/31/98 (UNAUDITED) 12/31/98
- ----------- -------- ----------- -------- ----------- --------
<S> <C> <C> <C> <C> <C>
$ (310,901) $ 2,679,016 $ (700,214) $ 2,724,807 $ (170,618) $ (477,598)
943,109 737,506 2,659,472 (9,244) (1,255,752) (30,358)
3,661,452 4,133,708 17,406,322 22,974,473 (1,391,255) (588,267)
- ----------- ----------- ------------ ----------- ----------- -----------
4,293,660 7,550,230 19,365,580 25,690,036 (2,817,625) (1,096,223)
- ----------- ----------- ------------ ----------- ----------- -----------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C>
1,825,928 1,806,531 (1,791,856) (2,309,026) (7,158,274) (2,173,725)
- ----------- ----------- ------------ ----------- ----------- -----------
1,825,928 1,806,531 (1,791,856) (2,309,026) (7,158,274) (2,173,725)
- ----------- ----------- ------------ ----------- ----------- -----------
6,119,588 9,356,761 17,573,724 23,381,010 (9,975,899) (3,269,948)
41,864,954 32,508,193 97,380,958 73,999,948 31,618,177 34,888,125
- ----------- ----------- ------------ ----------- ----------- -----------
$47,984,542 $41,864,95 $114,954,682 $97,380,958 $21,642,278 $31,618,177
=========== =========== ============ =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
GLOBAL GROWTH GLOBAL-SMALLER
OPPORTUNITIES COMPANIES
SUB-ACCOUNT SUB-ACCOUNT
--------------------- ----------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
6/30/99 ENDED 6/30/99 ENDED
(UNAUDITED) 12/31/98 (UNAUDITED) 12/31/98
----------- -------- ----------- --------
<S> <C> <C> <C>
$ (56,346) $ (45,233) $ (119,486) $ 2,687
236,969 170,051 (53,762) 237,916
880,072 921,826 195,753 664,912
- ---------- ---------- ----------- -----------
1,060,695 1,046,644 22,505 905,515
- ---------- ---------- ----------- -----------
10,556 2,080,972 (2,824,797) (950,338)
- ---------- ---------- ----------- -----------
10,556 2,080,972 (2,824,797) (950,338)
- ---------- ---------- ----------- -----------
1,071,251 3,127,616 (2,802,292) (44,823)
7,886,974 4,759,358 19,506,482 19,551,305
- ---------- ---------- ----------- -----------
$8,958,225 $7,886,974 $16,704,190 $19,506,482
========== ========== =========== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LARGE-CAP
INCOME GROWTH LARGE-CAP VALUE SMALL-CAP VALUE SUB-ACCOUNTS
SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT COMBINED
- ---------------------- ------------- --------------------- --------------------- ----------------------
SIX MONTHS 5/1/99* SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR TO ENDED YEAR ENDED YEAR ENDED YEAR
6/30/99 ENDED 6/30/99 *6/30/99 ENDED 6/30/99 ENDED 6/30/99 ENDED
(unaudited) 12/31/98 (unaudited) (unaudited) 12/31/98 (unaudited) 12/31/98 (unaudited) 12/31/98
- ----------- --------- ----------- ------------ -------- ----------- --------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ (60,177) $ 358,180 $ (1,615) $ (32,252) $ 93,225 $ (22,850) $ 232,466 $ (1,846,920) $ 9,423,344
(1,146) 48,543 444 35,122 (39,349) 47,064 (82,801) 3,149,734 2,413,020
63,027 120,665 100,218 533,005 109,072 1,263,434 (34,480) 25,685,812 28,776,595
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ------------ ------------
1,704 527,388 99,047 535,875 162,948 1,287,648 115,185 26,988,626 40,612,959
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ------------ ------------
(728,670) 178,197 1,501,757 1,992,440 3,415,478 1,360,379 2,094,012 (2,939,197) 14,049,826
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ------------ ------------
(728,670) 178,197 1,501,757 1,992,440 3,415,478 1,360,379 2,094,012 (2,939,197) 14,049,826
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ------------ ------------
(726,966) 705,585 1,600,804 2,528,315 3,578,426 2,648,027 2,209,197 24,049,429 54,662,785
8,986,114 8,280,529 -- 3,578,426 -- 2,209,197 -- 290,788,439 236,125,654
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ------------ ------------
$8,259,148 $8,986,114 $1,600,804 $6,106,741 $3,578,426 $4,857,224 $2,209,197 $314,837,868 $290,788,439
========== ========== ========== ========== ========== ========== ========== ============ ============
</TABLE>
5
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- -------------------------------------------------------------------------------
1. ORGANIZATION
Canada Life of America Variable Annuity Account 2 ("Variable Annuity Account 2")
was established on February 26, 1993 as a separate investment account of Canada
<PAGE>
Life Insurance Company of America ("CLICA") to receive and invest premium
payments under variable annuity policies issued by CLICA. Variable Annuity
Account 2 is registered as a unit investment trust under the Investment Company
Act of 1940, as amended. The assets of Variable Annuity Account 2 are invested
in the shares of Seligman Portfolios, Inc. (the "Fund"), a diversified,
open-end, management investment company. Variable Annuity Account 2 has fifteen
sub-accounts, each of which invests only in the shares of the corresponding
portfolio of the Fund.
The assets of Variable Annuity Account 2 are the property of CLICA. The
portion of Variable Annuity Account 2 assets applicable to the policies will not
be charged with liabilities arising out of any other business CLICA may conduct.
2. SIGNIFICANT ACCOUNTING POLICIES
INVESTMENTS
Investments in shares of the Fund are valued at the reported net asset values of
the respective portfolios. Realized gains and losses are computed on the basis
of average cost. The difference between cost and current market value of
investments owned is recorded as an unrealized gain or loss on investments.
DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS
Dividends and capital gain distributions are recorded on the ex-dividend date
and reflect the dividends declared by the Fund from their accumulated net
investment income and net realized investment gains. Except for the Cash
Management Portfolio, whose dividends are declared daily and paid monthly,
dividends and capital gain distributions are declared and paid annually.
Dividends and capital gain distributions paid to the Variable Annuity Account 2
are reinvested in additional shares of the respective portfolio of the Fund at
the net asset value per share.
FEDERAL INCOME TAXES
Variable Annuity Account 2 is not taxed separately because the operations of
Variable Annuity Account 2 will be included in the federal income tax return of
CLICA, which is taxed as a "life insurance company" under the provisions of the
Internal Revenue Code.
3. INVESTMENTS
The investment by Variable Annuity Account 2 in the individual portfolios of the
Fund at June 30, 1999, is as follows:
<TABLE>
<CAPTION>
NUMBER OF SHARES MARKET PRICE MARKET VALUE COST
---------------- ----------- ------------ ----
<S> <C> <C> <C> <C>
Bond 513,192 $ 9.93 $ 5,095,997 $ 5,322,717
Capital 877,203 22.53 19,763,384 16,160,731
Cash Management 15,907,804 1.00 15,907,804 15,907,804
Common Stock 2,326,303 20.62 47,968,368 41,391,345
Communications and Information 5,545,043 20.73 114,948,741 81,601,828
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Frontier 1,481,013 14.61 21,637,600 22,287,864
Global Growth Opportunities 587,821 15.24 8,958,392 6,992,668
Global Smaller Companies 1,194,289 13.91 16,612,560 15,753,450
Global Technology 466,702 17.48 8,157,951 6,407,423
International 558,899 16.06 8,975,918 7,495,032
High-Yield Bond 2,371,046 10.89 25,820,691 27,611,952
Income 745,401 11.08 8,259,043 8,202,775
Large-Cap Growth 153,296 10.42 1,597,344 1,497,126
Large-Cap Value 568,288 10.74 6,103,413 5,461,336
Small-Cap Value 463,051 10.49 4,857,405 3,628,451
----------- -----------
$314,664,611 $265,722,502
============ ============
</TABLE>
4. SECURITY PURCHASES AND SALES
The aggregate cost of purchases and the proceeds from sales of investments are
presented below:
<TABLE>
<CAPTION>
AGGREGATE COST OF PURCHASES PROCEEDS FROM SALES
------------------------- ------------------
<S> <C> <C>
Bond $ 2,143,587 $ 2,120,090
Capital 3,635,354 3,522,493
Cash Management 24,227,447 17,365,702
Common Stock 10,933,811 9,690,385
Communications and Information 12,155,845 15,274,242
Frontier 5,845,958 13,374,319
Global Growth Opportunities 1,346,753 1,434,059
Global Smaller Companies 1,169,595 4,330,921
Global Technology 5,697,410 4,529,160
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
International 498,582 1,393,462
High-Yield Bond 4,954,192 10,264,689
Income 985,660 1,830,989
Large-Cap Growth 1,510,108 13,426
Large-Cap Value 2,607,586 666,458
Small-Cap Value 1,802,224 471,892
------------ -------------
$ 79,514,112 $ 86,282,287
============ =============
</TABLE>
6
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
5. SUMMARY OF CHANGES FROM UNIT TRANSACTIONS
The following table represents a summary of changes from unit transactions
attributable to contract holders for the periods indicated. The Large-Cap Growth
Sub-Account commenced operations on May 1, 1999.
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, 1999 YEAR ENDED DECEMBER 31, 1998
------------------------------- ------------------------------
UNITS AMOUNT UNITS AMOUNT
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
BOND SUB-ACCOUNT
Accumulation Units:
Contract purchases and net transfers in 200,812 $ 3,444,893 290,989 $ 4,955,129
Terminated contracts and net transfers out (195,615) (3,352,648) (291,727) (4,948,349)
----------- ----------- ------------ ------------
5,197 92,245 (738) 6,780
----------- ----------- ------------ ------------
CAPITAL SUB-ACCOUNT Accumulation Units:
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Contract purchases and net transfers in 152,843 5,552,584 476,675 15,080,911
Terminated contracts and net transfers out (142,758) (5,205,408) (477,721) (14,957,014)
----------- ----------- ------------ ------------
10,085 347,176 (1,046) 123,897
----------- ----------- ------------ ------------
CASH MANAGEMENT SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 22,778,497 33,407,451 28,701,853 40,888,881
Terminated contracts and net transfers out (18,147,637) (26,551,766) (27,814,834) (39,648,750)
----------- ----------- ------------ ------------
4,630,860 6,855,685 887,019 1,240,131
----------- ----------- ------------ ------------
COMMON STOCK SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 353,466 14,728,208 584,818 21,245,552
Terminated contracts and net transfers out (308,812) (12,902,280) (533,311) (19,439,021)
----------- ----------- ------------ ------------
44,654 1,825,928 51,507 1,806,531
----------- ----------- ------------ ------------
COMMUNICATIONS AND INFORMATION SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 664,195 16,682,755 1,336,799 26,057,001
Terminated contracts and net transfers out (732,260) (18,474,611) (1,426,919) (28,366,027)
----------- ----------- ------------ ------------
(68,065) (1,791,856) (90,120) (2,309,026)
----------- ----------- ------------ ------------
FRONTIER SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 422,673 7,236,246 920,590 17,444,970
Terminated contracts and net transfers out (871,391) (14,394,520) (1,042,222) (19,618,695)
----------- ----------- ------------ ------------
(448,718) (7,158,274) (121,632) (2,173,725)
----------- ----------- ------------ ------------
GLOBAL GROWTH OPPORTUNITIES SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 305,039 4,199,631 601,646 7,353,393
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Terminated contracts and net transfers out (304,808) (4,189,075) (434,558) (5,272,421)
----------- ----------- ------------ ------------
231 10,556 167,088 2,080,972
----------- ----------- ------------ ------------
GLOBAL SMALLER COMPANIES SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 257,557 3,704,588 479,301 7,291,622
Terminated contracts and net transfers out (461,498) (6,529,385) (549,248) (8,241,960)
----------- ----------- ------------ ------------
(203,941) (2,824,797) (69,947) (950,338)
----------- ----------- ------------ ------------
GLOBAL TECHNOLOGY SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 349,703 6,100,783 406,018 5,711,409
Terminated contracts and net transfers out (273,949) (4,853,941) (355,334) (4,982,165)
----------- ----------- ------------ ------------
75,754 1,246,842 50,684 729,244
----------- ----------- ------------ ------------
INTERNATIONAL SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 98,790 1,568,587 234,066 3,590,169
Terminated contracts and net transfers out (143,647) (2,322,967) (277,507) (4,235,471)
----------- ----------- ------------ ------------
(44,857) (754,380) (43,441) (645,302)
----------- ----------- ------------ ------------
HIGH-YIELD BOND SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 551,465 1,589,267 7,545,783 22,003,390
Terminated contracts and net transfers out (914,300) (12,460,011) (13,550,415) (980,942)
----------- ----------- ------------ ------------
(362,835) (4,914,228) 608,325 8,452,975
----------- ----------- ------------ ------------
</TABLE>
7
<PAGE>
CANADA LIFE OF AMERICA VARIABLE ANNUITY ACCOUNT 2
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, 1999 YEAR ENDED DECEMBER 31, 1998
------------------------------- ------------------------------
UNITS AMOUNT UNITS AMOUNT
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
INCOME SUB-ACCOUNT
Accumulation Units:
Contract purchases and net transfers in 50,450 145,220 1,145,512 3,209,039
Terminated contracts and net transfers out (82,126) (136,996) (1,874,182) (3,030,842)
--------- --------- ---------- -----------
(31,676) (728,670) 8,224 178,197
--------- --------- ---------- -----------
LARGE-CAP GROWTH SUB-ACCOUNT* Accumulation Units:
Contract purchases and net transfers in 155,144 1,513,438
Terminated contracts and net transfers out (1,156) (11,681)
--------- ---------
1 53,988 1,501,757
--------- ---------
LARGE-CAP VALUE SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 342,215 470,789 3,496,460 4,426,163
Terminated contracts and net transfers out (144,608) (108,615) (1,504,020) (1,010,685)
--------- --------- ---------- -----------
197,607 1,992,440 362,174 3,415,478
--------- --------- ---------- -----------
SMALL-CAP VALUE SUB-ACCOUNT Accumulation Units:
Contract purchases and net transfers in 263,558 362,710 2,517,287 2,860,882
Terminated contracts and net transfers out (117,720) (1,156,908) (94,013) (766,870)
--------- --------- ---------- -----------
145,838 1,360,379 268,697 2,094,012
--------- --------- --------- -----------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Net increase (decrease) from unit transactions $(2,939,197) $14,049,826
=========== ===========
</TABLE>
- ------------------
* From commencement of operations.
6. MORTALITY AND EXPENSE RISK (M AND E) CHARGES
CLICA assumes mortality and expense risks related to the operations of Variable
Annuity Account 2 and deducts a charge equal to an effective annual rate of
1.25% of the net asset value of each Sub-Account at each valuation period. In
addition, at each valuation period an effective annual rate of 0.15% of the net
asset value of each Sub-Account was deducted as daily administration fees.
7. NET ASSETS
Net assets at June 30, 1999, consisted of the following:
<TABLE>
<CAPTION>
NET
ACCUMULATED NET UNREALIZED
INVESTMENT REALIZED APPRECIATION
ACCUMULATED INCOME GAIN (LOSS) (DEPRECIATION) COMBINED
UNIT M AND E AND CAPITAL ON OF NET
SUB-ACCOUNT TRANSACTIONS CHARGES GAINS INVESTMENTS INVESTMENTS ASSETS
- ------------ ------------ ------------ ------------ ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Bond $ 4,620,625 $ (214,784) $ 880,097 $ 36,228 $ (226,720) $ 5,095,446
Capital 12,211,989 (705,391) 3,028,248 1,636,901 3,602,653 19,774,400
Cash Management 14,849,342 (548,300) 1,637,934 -- -- 15,938,976
Common Stock 28,133,283 (1,544,287) 12,436,996 2,381,527 6,577,023 47,984,542
Communications and Information 55,948,628 (3,745,169) 25,168,079 4,236,231 33,346,913 114,954,682
Frontier 17,451,560 (1,420,410) 6,306,959 (45,567) (650,264) 21,642,278
Global Growth Opportunities 6,609,668 (201,594) 98,881 485,546 1,965,724 8,958,225
Global Smaller Companies 13,997,568 (864,822) 2,062,353 649,981 859,110 16,704,190
Global Technology 4,933,081 (147,971) 683,861 938,554 1,750,528 8,158,053
International 6,306,706 (441,791) 761,172 875,922 1,480,886 8,982,895
High-Yield Bond 23,263,868 (988,087) 5,195,530 140,214 (1,791,261) 25,820,264
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Income 6,102,580 (477,840) 2,477,943 100,197 56,268 8,259,148
Large-Cap Growth 1,501,757 (1,615) -- 444 100,218 1,600,804
Large-Cap Value 5,407,918 (46,770) 107,743 (4,227) 642,077 6,106,741
Small-Cap Value 3,454,391 (32,438) 242,054 (35,737) 1,228,954 4,857,224
------------ ------------ ----------- ----------- ----------- ------------
$204,792,964 $(11,381,269) $61,087,850 $11,396,214 $48,942,109 $314,837,868
============ ============ =========== =========== =========== ============
</TABLE>
8. UNIT VALUES
Unit Values as reported are calculated by dividing total net assets by total
units for each Sub-Account.
8
<PAGE>
The attached are incorporated by reference herein to the semi-annual reports
filed by and on behalf of the following:
Seligman Portfolios, Inc., filed August 31, 1999
Portfolios which include: Seligman Capital; Seligman Cash Management;
Seligman Common Stock; Seligman Bond; Seligman Income; Seligman
Henderson International; Seligman Communications and Information;
Seligman Frontier; Seligman Henderson Global Smaller Companies; Seligman
High-Yield Bond; Seligman Henderson Global Technology; Seligman
Henderson Global Growth Opportunities; Seligman Large-Cap; Seligman
Small-Cap
