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PFL WRIGHT VARIABLE ANNUITY
The PFL Wright Variable Annuity Account Semi-Annual Report June 30, 1997
[LOGO OF PFL LIFE APPEARS HERE]
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THE PFL WRIGHT VARIABLE ANNUITY ACCOUNT
BALANCE SHEET
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
WRIGHT
NEAR TERM
BOND
TOTAL SUBACCOUNT
----------- ----------
<S> <C> <C>
ASSETS
Cash.................................................... $ 40 40
Investments in mutual funds, at current market value
(Note 2):
Wright Managed Blue Chip Series Trust
Wright Near Term Bond Portfolio....................... 656,305 656,305
Wright Total Return Bond Portfolio.................... 815,829 --
Wright Selected Blue Chip Portfolio................... 3,076,705 --
Wright International Blue Chip Portfolio.............. 1,610,650 --
----------- -------
Total investments in mutual funds...................... 6,159,489 656,305
----------- -------
Total Assets............................................ $ 6,159,529 656,345
=========== =======
LIABILITIES AND CONTRACT OWNERS' EQUITY
Liabilities:
Contract terminations payable.......................... $ 3,713 --
----------- -------
Total Liabilities...................................... 3,713 --
Contract Owners' Equity:
Deferred annuity contracts terminable by owners
(Note 3).............................................. 6,155,816 656,345
----------- -------
$ 6,159,529 656,345
=========== =======
</TABLE>
See accompanying Notes to Financial Statements.
2
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<TABLE>
<CAPTION>
WRIGHT WRIGHT WRIGHT
TOTAL SELECTED INTERNATIONAL
RETURN BOND BLUE CHIP BLUE CHIP
SUBACCOUNT SUBACCOUNT SUBACCOUNT
----------- ---------- -------------
<S> <C> <C>
-- -- --
-- -- --
675,668 -- --
-- 2,603,794 --
-- -- 1,255,789
------- --------- ---------
675,668 2,603,794 1,255,789
------- --------- ---------
675,668 2,603,794 1,255,789
======= ========= =========
390 2,347 96
------- --------- ---------
390 2,347 96
675,278 2,601,447 1,255,693
------- --------- ---------
675,668 2,603,794 1,255,789
======= ========= =========
</TABLE>
3
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THE PFL WRIGHT VARIABLE ANNUITY ACCOUNT
STATEMENT OF OPERATIONS
Six Months Ended June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
WRIGHT
NEAR TERM
BOND
TOTAL SUBACCOUNT
-------- ----------
<S> <C> <C>
NET INVESTMENT INCOME
Income:
Dividends................................................ $547,129 16,164
Expenses (Note 5):
Administration fee....................................... 900 100
Mortality and expense risk charge........................ 28,661 3,350
-------- -------
Net Investment income.................................. 517,568 12,714
-------- -------
NET REALIZED AND UNREALIZED CAPITAL GAIN (LOSS) FROM
INVESTMENTS
Net realized capital gain (loss) from sales of
investments:
Proceeds from sales...................................... 420,535 120,903
Cost of investments sold................................. 373,659 122,688
-------- -------
Net realized capital gain (loss) from sales of invest-
ments.................................................... 46,876 (1,785)
Net change in unrealized appreciation/depreciation of
investments:
Beginning of the period.................................. 760,507 (2,476)
End of the period........................................ 713,410 (1,557)
-------- -------
Net change in unrealized appreciation/depreciation of
investments........................................... (47,097) 919
-------- -------
Net realized and unrealized capital gain (loss) from
investments........................................... (221) (866)
-------- -------
INCREASE FROM OPERATIONS.................................. $517,347 11,848
======== =======
</TABLE>
See accompanying Notes to Financial Statements.
4
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<TABLE>
<CAPTION>
WRIGHT WRIGHT WRIGHT
TOTAL SELECTED INTERNATIONAL
RETURN BOND BLUE CHIP BLUE CHIP
SUBACCOUNT SUBACCOUNT SUBACCOUNT
- ----------- ---------- -------------
<S> <C> <C>
13,706 2,070 --
115 445 228
3,161 11,706 6,159
------- ------- -------
10,430 (10,081) (6,387)
------- ------- -------
72,383 256,017 365,858
70,220 200,950 333,199
------- ------- -------
2,163 55,067 32,659
27,893 260,715 47,117
(1,835) 477,137 117,716
------- ------- -------
(29,728) 216,422 70,599
------- ------- -------
(27,565) 271,489 103,258
------- ------- -------
(17,135) 261,408 96,871
======= ======= =======
</TABLE>
5
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THE PFL WRIGHT VARIABLE ANNUITY ACCOUNT
STATEMENTS OF CHANGES IN CONTRACT OWNERS' EQUITY
Six Months Ended June 30, 1997 and Year Ended December 31, 1996 (Unaudited)
<TABLE>
<CAPTION>
WRIGHT
NEAR TERM
BOND
TOTAL SUBACCOUNT
--------------------- ----------------
1997 1996 1997 1996
---------- --------- ------- -------
<S> <C> <C> <C> <C>
OPERATIONS
Net investment income (loss)......... $ 517,568 168 12,714 13,641
Net realized capital gain (loss)..... 46,876 314,797 (1,785) 1,997
Net change in unrealized appreciation
(depreciation) of investments....... (47,097) 417,339 919 (9,919)
---------- --------- ------- -------
Increase from operations............. 517,347 732,304 11,848 5,719
---------- --------- ------- -------
CONTRACT TRANSACTIONS
Net contract purchase payments....... 202,694 431,901 26,084 27,285
Transfer payments from (to) other
subaccounts or general account...... -- 167,183 (12,292) 292,586
Contract terminations, withdrawals,
and other deductions................ (128,708) (235,547) (21,532) --
---------- --------- ------- -------
Increase (decrease) from contract
transactions........................ 73,987 363,537 (7,740) 319,871
---------- --------- ------- -------
Net increase in contract owner's
equity.............................. 591,334 1,095,841 4,108 325,590
---------- --------- ------- -------
CONTRACT OWNERS' EQUITY
Beginning of period.................. 5,564,482 4,468,641 652,237 326,647
---------- --------- ------- -------
End of period........................ $6,155,816 5,564,482 656,345 652,237
========== ========= ======= =======
</TABLE>
See accompanying Notes to Financial Statements.
6
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<TABLE>
<CAPTION>
WRIGHT WRIGHT WRIGHT
TOTAL RETURN SELECTED INTERNATIONAL
BOND BLUE CHIP BLUE CHIP
SUBACCOUNT SUBACCOUNT SUBACCOUNT
------------------ -------------------------- --------------------------
1997 1996 1997 1996 1997 1996
------- ------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
18,111 23,580 413,132 (24,056) 73,611 (12,997)
2,325 7,417 34,707 247,928 11,629 57,455
(5,466) (24,655) (53,080) 299,287 10,530 152,626
------- ------- --------- --------- --------- ---------
14,970 6,342 394,759 523,159 95,770 197,084
------- ------- --------- --------- --------- ---------
44,944 30,592 62,739 248,378 68,927 125,646
(19,943) 259,650 10,648 (211,360) 21,587 (173,693)
(14,034) (44,530) (60,138) (133,918) (33,003) (57,099)
------- ------- --------- --------- --------- ---------
10,967 245,712 13,249 (96,900) 57,511 (105,146)
------- ------- --------- --------- --------- ---------
25,937 252,054 408,008 426,259 153,281 91,938
------- ------- --------- --------- --------- ---------
789,530 537,476 2,665,528 2,239,269 1,457,187 1,365,249
------- ------- --------- --------- --------- ---------
815,467 789,530 3,073,536 2,665,528 1,610,468 1,457,187
======= ======= ========= ========= ========= =========
</TABLE>
7
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THE PFL WRIGHT VARIABLE ANNUITY ACCOUNT
NOTES TO FINANCIAL STATEMENTS
June 30, 1997 (Unaudited)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization -- The PFL Wright Variable Annuity Account ("Variable Account") is
a segregated investment account of PFL Life Insurance Company ("PFL Life"), an
indirect, wholly-owned subsidiary of AEGON USA, Inc. ("AUSA"), a holding
company. AUSA is an indirect, wholly-owned subsidiary of AEGON nv, a holding
company organized under the laws of The Netherlands.
The Variable Account is registered with the Securities and Exchange Commission
as a Unit Investment Trust pursuant to provisions of the Investment Company Act
of 1940.
Investments -- Net purchase payments received by the Variable Account are
invested in the portfolios of the Wright Managed Blue Chip Series Trust as
selected by the contract owner. Investments are stated at the closing net asset
values per share on June 30, 1997.
Realized capital gains and losses from sale of shares in the mutual funds are
determined on the first-in, first-out basis. Investment transactions are
accounted for on the trade date (date the order to buy or sell is executed) and
dividend income is recorded on the ex-dividend date. Unrealized gains or losses
from investments in the mutual funds are credited or charged to contract
owners' equity.
Dividend Income -- Dividends received from the mutual funds investments are
reinvested to purchase additional mutual fund shares.
2. INVESTMENTS
A summary of the mutual fund investments at June 30, 1997 follows:
<TABLE>
<CAPTION>
NUMBER NET ASSET
OF SHARES VALUE MARKET
HELD PER SHARE VALUE COST
----------- --------- ---------- ----------
<S> <C> <C> <C> <C>
Wright Managed Blue Chip Series
Trust
Wright Near Term Bond Portfolio... 67,800.084 9.68 $ 656,305 $ 657,862
Wright Total Return Bond
Portfolio........................ 86,514.252 9.43 815,829 818,057
Wright Selected Blue Chip
Portfolio........................ 225,069.885 13.67 3,076,705 2,569,783
Wright International Blue Chip
Portfolio........................ 135,235.087 11.91 1,610,650 1,400,377
---------- ----------
$6,159,489 $5,446,079
========== ==========
</TABLE>
3. CONTRACT OWNERS EQUITY
A summary of deferred annuity contracts terminable by owners at June 30, 1997
follows:
<TABLE>
<CAPTION>
ACCUMULATION ACCUMULATION TOTAL
SUBACCOUNT UNITS OWNED UNIT VALUE CONTRACT VALUE
- ---------- ------------- ------------ --------------
<S> <C> <C> <C>
Wright Near Term Bond................ 606,339.215 1.082472 $ 656,345
Wright Total Return Bond............. 758,103.863 1.075666 815,467
Wright Selected Blue Chip............ 1,902,457.713 1.615561 3,073,536
Wright International Blue Chip....... 1,320,557.644 1.219536 1,610,468
----------
$6,155,816
==========
</TABLE>
8
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A summary of changes in contract owners' account units follows:
<TABLE>
<CAPTION>
WRIGHT WRIGHT WRIGHT WRIGHT
NEAR TERM TOTAL SELECTED INTERNATIONAL
BOND RETURN BOND BLUE CHIP BLUE CHIP
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ----------- ---------- -------------
<S> <C> <C> <C> <C>
Units outstanding 1/1/96..... 312,205 509,157 1,934,520 1,380,933
Units purchased.............. 26,015 29,341 197,752 118,733
Units redeemed and
transferred................. 274,599 209,247 (238,177) (231,495)
------- ------- --------- ---------
Units outstanding 12/31/96... 612,819 747,745 1,894,095 1,268,171
Units purchased.............. 24,466 42,541 42,281 61,495
Units redeemed and
transferred................. (30,946) (32,182) (33,918) (9,108)
------- ------- --------- ---------
Units outstanding 6/30/97.... 606,339 758,104 1,902,458 1,320,558
======= ======= ========= =========
</TABLE>
At June 30, 1997, contract owners' equity was comprised of:
<TABLE>
<CAPTION>
WRIGHT WRIGHT WRIGHT WRIGHT
NEAR TERM TOTAL SELECTED INTERNATIONAL
BOND RETURN BOND BLUE CHIP BLUE CHIP
TOTAL SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
---------- ---------- ----------- ---------- -------------
<S> <C> <C> <C> <C> <C>
Unit transactions,
accumulated net
investment income and
realized capital gains... $5,442,406 657,902 817,695 2,566,614 1,400,195
Adjustment for
appreciation/depreciation
to market value.......... 713,410 (1,557) (2,228) 506,922 210,273
---------- ------- ------- --------- ---------
Total Contract Owners'
Equity................... $6,155,816 656,345 815,467 3,073,536 1,610,468
========== ======= ======= ========= =========
</TABLE>
4. TAXES
Operations of the Variable Account form a part of PFL Life, which is taxed as a
life insurance company under Subchapter L of the Internal Revenue Code of 1986,
as amended (the "Code"). The operations of the Variable Account are accounted
for separately from other operations of PFL Life for purposes of federal income
taxation. The Variable Account is not separately taxable as a regulated
investment company under Subchapter M of the Code and is not otherwise taxable
as an entity separate from PFL Life. Under existing federal income tax laws,
the income of the Variable Account, to the extent applied to increase reserves
under the variable annuity contracts, is not taxable to PFL Life.
5. ADMINISTRATIVE, MORTALITY AND EXPENSE RISK CHARGE
Administrative charges include an annual charge of $30 per contract which will
commence on the first policy anniversary of each contract owner's account.
Charges for administrative fees to the variable annuity contracts are an
expense of the Variable Account.
PFL Life deducts a daily charge equal to an annual rate of 1.00% of the value
of the contract owner's individual account as a charge for assuming certain
mortality and expense risks.
9
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6. PURCHASES AND SALES OF INVESTMENT SECURITIES
The aggregate cost of purchases and proceeds from sales of investments were as
follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
------------------ -----------------
1997 1996
------------------ -----------------
PURCHASES SALES PURCHASES SALES
---------- ------- --------- -------
<S> <C> <C> <C> <C>
Wright Managed Blue Chip Series Trust
Wright Near Term Bond Portfolio......... $ 125,867 120,903 117,059 55,820
Wright Total Return Bond Portfolio...... 106,462 77,397 238,150 72,383
Wright Select Blue Chip Portfolio....... 553,874 126,999 348,817 256,017
Wright International Blue Chip
Portfolio.............................. 226,387 95,236 153,097 365,858
---------- ------- ------- -------
$1,012,590 420,535 857,123 750,078
========== ======= ======= =======
</TABLE>
10
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