<PAGE> PAGE 1
000 B000000 12/31/97
000 C000000 914324
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0.a
000 J000000 U
001 A000000 LIFE AND ANNUITY TRUST
001 B000000 811-8118
001 C000000 5013772521
002 A000000 111 CENTER STREET
002 B000000 LITTLE ROCK
002 C000000 AR
002 D010000 72201
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 4
007 C010100 1
007 C020100 ASSET ALLOCATION FUND
007 C030100 N
007 C010200 2
007 C020200 GROWTH AND INCOME FUND
007 C030200 N
007 C010300 3
007 C020300 MONEY MARKET FUND
007 C030300 N
007 C010400 4
007 C020400 U.S. GOVERNMENT ALLOCATION FUND
007 C030400 N
007 C010500 5
007 C010600 6
007 C010700 7
007 C010800 8
007 C010900 9
007 C011000 10
020 A000001 MORGAN STANLEY & COMPANY
020 B000001 13-2655998
020 C000001 59
020 A000002 INTERSTATE JOHNSON LANE
020 B000002 56-0276690
020 C000002 22
020 A000003 ALPHA MANAGEMENT INC
020 B000003 94-3105302
020 C000003 20
020 A000004 SALOMON BROTHERS, INC
020 B000004 13-3082694
<PAGE> PAGE 2
020 C000004 15
020 A000005 BEARS STEARNS SECURITIES CORP
020 B000005 13-3299429
020 C000005 8
020 A000006 SMITH BARNEY SHEARSON
020 B000006 13-1912900
020 C000006 6
020 A000007 EXECUTION SERVICES INC
020 B000007 UNKNOWN
020 C000007 5
020 A000008 LEHMAN BROTHERS INC
020 B000008 13-2518466
020 C000008 5
020 A000009 JP MORGAN SECURITIES
020 B000009 13-3224016
020 C000009 4
020 A000010 LEWCO SEC
020 B000010 13-2765944
020 C000010 4
021 000000 190
022 A000001 GOLDMAN SACHS
022 B000001 13-5108880
022 C000001 124408
022 D000001 50040
022 A000002 SALOMON BROTHERS
022 B000002 13-3082694
022 C000002 76077
022 D000002 68972
022 A000003 MERRILL LYNCH PIERCE FENNER
022 B000003 13-2761776
022 C000003 75228
022 D000003 25020
022 A000004 MORGAN STANLEY & CO
022 B000004 13-2655998
022 C000004 39043
022 D000004 26348
022 A000005 JP MORGAN SECURITIES
022 B000005 13-3224016
022 C000005 39692
022 D000005 12272
022 A000006 LEHMAN BROTHERS INC
022 B000006 13-2518466
022 C000006 27588
022 D000006 8325
022 A000007 ALPHA MANAGEMENT INC
022 B000007 94-3105302
022 C000007 10376
022 D000007 7877
022 A000008 HSBC SECURITIES INC
022 B000008 13-2650272
022 C000008 16921
<PAGE> PAGE 3
022 D000008 0
022 A000009 INTERSTATE JOHNSON LANE
022 B000009 56-0276690
022 C000009 9572
022 D000009 6552
022 A000010 SMITH BARNEY SHEARSON
022 B000010 13-1912900
022 C000010 5756
022 D000010 2839
023 C000000 520522
023 D000000 309717
027 000000 Y
042 A00AA00 0
042 B00AA00 0
042 C00AA00 0
042 D00AA00 0
042 E00AA00 0
042 F00AA00 0
042 G00AA00 0
042 H00AA00 0
043 00AA00 0
044 00AA00 0
077 A000000 Y
077 B000000 Y
078 000000 N
080 A00AA00 CHUBB INSURANCE GROUP OF COMPANIES
080 C00AA00 40000
081 A00AA00 Y
081 B00AA00 63
082 A00AA00 N
082 B00AA00 0
083 A00AA00 N
083 B00AA00 0
084 A00AA00 N
084 B00AA00 0
085 A00AA00 Y
085 B00AA00 N
086 A010000 0
086 A020000 0
086 B010000 0
086 B020000 0
086 C010000 0
086 C020000 0
086 D010000 0
086 D020000 0
086 E010000 0
086 E020000 0
086 F010000 0
086 F020000 0
008 A000101 WELLS FARGO BANK NA
008 B000101 A
<PAGE> PAGE 4
008 C000101 801-00000
008 D010101 SAN FRANCISCO
008 D020101 CA
008 D030101 94105
008 A000102 BZW BARLCLAYS GLOBAL FUND ADVISORS
008 B000102 S
008 C000102 801-0000
008 D010102 SAN FRANCISCO
008 D020102 CA
008 D030102 94105
024 000100 N
025 D000101 0
025 D000102 0
025 D000103 0
025 D000104 0
025 D000105 0
025 D000106 0
025 D000107 0
025 D000108 0
028 A010100 2604
028 A020100 878
028 A030100 0
028 A040100 0
028 B010100 2329
028 B020100 0
028 B030100 0
028 B040100 89
028 C010100 1688
028 C020100 0
028 C030100 0
028 C040100 44
028 D010100 1782
028 D020100 1013
028 D030100 0
028 D040100 5417
028 E010100 1829
028 E020100 0
028 E030100 0
028 E040100 776
028 F010100 2760
028 F020100 7396
028 F030100 0
028 F040100 55
028 G010100 12992
028 G020100 9287
028 G030100 0
028 G040100 6381
028 H000100 0
062 A000100 Y
062 B000100 99.5
062 C000100 0.0
<PAGE> PAGE 5
062 D000100 0.0
062 E000100 0.0
062 F000100 0.0
062 G000100 0.0
062 H000100 0.0
062 I000100 0.0
062 J000100 0.0
062 K000100 0.0
062 L000100 0.0
062 M000100 0.0
062 N000100 0.0
062 O000100 0.0
062 P000100 0.0
062 Q000100 0.0
062 R000100 0.0
063 A000100 0
063 B000100 6.9
064 A000100 N
064 B000100 N
066 A000100 Y
066 B000100 N
066 C000100 N
066 D000100 N
066 E000100 N
066 F000100 N
066 G000100 Y
067 000100 Y
068 A000100 N
068 B000100 N
069 000100 N
071 A000100 54025
071 B000100 59731
071 C000100 34535
071 D000100 156
072 A000100 12
072 B000100 4213
072 C000100 0
072 D000100 0
072 E000100 0
072 F000100 420
072 G000100 36
072 H000100 0
072 I000100 94
072 J000100 0
072 K000100 0
072 L000100 0
072 M000100 12
072 N000100 4
072 O000100 0
072 P000100 0
072 Q000100 0
<PAGE> PAGE 6
072 R000100 13
072 S000100 16
072 T000100 0
072 U000100 0
072 V000100 0
072 W000100 2
072 X000100 597
072 Y000100 38
072 Z000100 3654
072AA000100 8764
072BB000100 0
072CC010100 1203
072CC020100 0
072DD010100 3654
072DD020100 0
072EE000100 7396
073 A010100 0.5964
073 A020100 0.0000
073 B000100 1.1601
073 C000100 0.0000
074 A000100 1
074 B000100 0
074 C000100 59424
074 D000100 26630
074 E000100 0
074 F000100 0
074 G000100 0
074 H000100 0
074 I000100 0
074 J000100 0
074 K000100 0
074 L000100 1564
074 M000100 5
074 N000100 87624
074 O000100 0
074 P000100 57
074 Q000100 0
074 R010100 0
074 R020100 0
074 R030100 0
074 R040100 1061
074 S000100 0
074 T000100 86506
074 U010100 7217
074 U020100 0
074 V010100 11.99
074 V020100 0.00
074 W000100 0.0000
074 X000100 3
074 Y000100 2500
075 A000100 0
<PAGE> PAGE 7
075 B000100 70201
076 000100 0.00
008 A000201 WELLS FARGO BANK, NA
008 B000201 A
008 C000201 801-00000
008 D010201 SAN FRANCISCO
008 D020201 CA
008 D030201 94105
024 000200 Y
025 A000201 GOLDMAN SACHS
025 B000201 13-5108880
025 C000201 D
025 D000201 2793
025 A000202 JP MORGAN
025 B000202 13-3224016
025 C000202 D
025 D000202 1923
025 A000203 DELETE
025 D000203 0
025 A000204 DELETE
025 D000204 0
025 D000205 0
025 D000206 0
025 D000207 0
025 D000208 0
028 A010200 2484
028 A020200 161
028 A030200 0
028 A040200 261
028 B010200 2626
028 B020200 0
028 B030200 0
028 B040200 56
028 C010200 1824
028 C020200 0
028 C030200 0
028 C040200 59
028 D010200 1775
028 D020200 158
028 D030200 0
028 D040200 389
028 E010200 1175
028 E020200 0
028 E030200 0
028 E040200 173
028 F010200 2630
028 F020200 3830
028 F030200 0
028 F040200 0
028 G010200 12514
028 G020200 4149
<PAGE> PAGE 8
028 G030200 0
028 G040200 938
028 H000200 0
055 A000200 N
055 B000200 N
056 000200 Y
057 000200 N
062 A000200 N
062 B000200 0.0
062 C000200 0.0
062 D000200 0.0
062 E000200 0.0
062 F000200 0.0
062 G000200 0.0
062 H000200 0.0
062 I000200 0.0
062 J000200 0.0
062 K000200 0.0
062 L000200 0.0
062 M000200 0.0
062 N000200 0.0
062 O000200 0.0
062 P000200 0.0
062 Q000200 0.0
062 R000200 0.0
063 A000200 0
063 B000200 0.0
071 A000200 86685
071 B000200 60256
071 C000200 48545
071 D000200 124
072 A000200 12
072 B000200 261
072 C000200 716
072 D000200 0
072 E000200 0
072 F000200 318
072 G000200 28
072 H000200 0
072 I000200 72
072 J000200 18
072 K000200 0
072 L000200 0
072 M000200 12
072 N000200 1
072 O000200 0
072 P000200 0
072 Q000200 0
072 R000200 11
072 S000200 13
072 T000200 0
<PAGE> PAGE 9
072 U000200 0
072 V000200 0
072 W000200 60
072 X000200 533
072 Y000200 189
072 Z000200 633
072AA000200 6849
072BB000200 0
072CC010200 143
072CC020200 0
072DD010200 633
072DD020200 0
072EE000200 3830
073 A010200 0.1889
073 A020200 0.0000
073 B000200 1.0263
073 C000200 0.0000
074 A000200 1
074 B000200 4716
074 C000200 0
074 D000200 0
074 E000200 0
074 F000200 64132
074 G000200 0
074 H000200 0
074 I000200 0
074 J000200 0
074 K000200 0
074 L000200 3437
074 M000200 1
074 N000200 72287
074 O000200 125
074 P000200 41
074 Q000200 0
074 R010200 0
074 R020200 0
074 R030200 0
074 R040200 177
074 S000200 0
074 T000200 71944
074 U010200 4285
074 U020200 0
074 V010200 16.79
074 V020200 0.00
074 W000200 0.0000
074 X000200 2
074 Y000200 0
075 A000200 0
075 B000200 53277
076 000200 0.00
008 A000301 WELLS FARGO BANK, NA
<PAGE> PAGE 10
008 B000301 A
008 C000301 801-00000
008 D010301 SAN FRANCISCO
008 D020301 CA
008 D030301 94105
024 000300 Y
025 A000301 GOLDMAN SACHS
025 B000301 13-5108880
025 C000301 D
025 D000301 2208
025 A000302 HSBC SECURITIES
025 B000302 13-2650272
025 C000302 D
025 D000302 3679
025 A000303 JP MORGAN
025 B000303 13-3224016
025 C000303 D
025 D000303 192
025 A000304 MORGAN STANLEY & CO
025 B000304 13-2655998
025 C000304 D
025 D000304 2679
025 D000305 0
025 D000306 0
025 D000307 0
025 D000308 0
028 A010300 1680
028 A020300 66
028 A030300 0
028 A040300 1081
028 B010300 1490
028 B020300 68
028 B030300 0
028 B040300 994
028 C010300 1482
028 C020300 73
028 C030300 0
028 C040300 1748
028 D010300 2127
028 D020300 69
028 D030300 0
028 D040300 1820
028 E010300 2358
028 E020300 73
028 E030300 0
028 E040300 1036
028 F010300 1021
028 F020300 74
028 F030300 0
028 F040300 944
028 G010300 10158
<PAGE> PAGE 11
028 G020300 423
028 G030300 0
028 G040300 7623
028 H000300 0
055 A000300 N
055 B000300 N
056 000300 Y
057 000300 N
062 A000300 Y
062 B000300 69.0
062 C000300 0.0
062 D000300 59.0
062 E000300 0.0
062 F000300 0.0
062 G000300 0.0
062 H000300 0.0
062 I000300 0.0
062 J000300 0.0
062 K000300 0.0
062 L000300 0.0
062 M000300 0.0
062 N000300 0.0
062 O000300 0.0
062 P000300 0.0
062 Q000300 0.0
062 R000300 0.0
063 A000300 46
063 B000300 0.0
064 A000300 Y
064 B000300 N
071 A000300 0
071 B000300 0
071 C000300 0
071 D000300 0
072 A000300 12
072 B000300 873
072 C000300 0
072 D000300 0
072 E000300 0
072 F000300 72
072 G000300 8
072 H000300 0
072 I000300 15
072 J000300 6
072 K000300 0
072 L000300 0
072 M000300 12
072 N000300 0
072 O000300 0
072 P000300 0
072 Q000300 0
<PAGE> PAGE 12
072 R000300 13
072 S000300 7
072 T000300 0
072 U000300 0
072 V000300 0
072 W000300 37
072 X000300 170
072 Y000300 85
072 Z000300 788
072AA000300 0
072BB000300 0
072CC010300 0
072CC020300 0
072DD010300 788
072DD020300 0
072EE000300 0
073 A010300 0.0544
073 A020300 0.0000
073 B000300 0.0000
073 C000300 0.0000
074 A000300 2
074 B000300 8758
074 C000300 10235
074 D000300 0
074 E000300 0
074 F000300 0
074 G000300 0
074 H000300 0
074 I000300 0
074 J000300 0
074 K000300 0
074 L000300 146
074 M000300 0
074 N000300 19141
074 O000300 0
074 P000300 8
074 Q000300 0
074 R010300 0
074 R020300 0
074 R030300 0
074 R040300 4345
074 S000300 0
074 T000300 14788
074 U010300 14788
074 U020300 0
074 V010300 1.00
074 V020300 0.00
074 W000300 0.0003
074 X000300 2
074 Y000300 0
075 A000300 15963
<PAGE> PAGE 13
075 B000300 0
076 000300 0.00
008 A000401 WELLS FARGO BANK,NA
008 B000401 A
008 C000401 801-00000
008 D010401 SAN FRANCISCO
008 D020401 CA
008 D030401 94105
008 A000402 BZW BARCLAYS GLOBAL FUND ADVISORS
008 B000402 S
008 C000402 801-00000
008 D010402 SAN FRANCISCO
008 D020402 CA
008 D030402 94105
024 000400 N
025 D000401 0
025 D000402 0
025 D000403 0
025 D000404 0
025 D000405 0
025 D000406 0
025 D000407 0
025 D000408 0
028 A010400 2207
028 A020400 90
028 A030400 0
028 A040400 109
028 B010400 716
028 B020400 96
028 B030400 0
028 B040400 160
028 C010400 998
028 C020400 101
028 C030400 0
028 C040400 51
028 D010400 3195
028 D020400 97
028 D030400 0
028 D040400 74
028 E010400 639
028 E020400 117
028 E030400 0
028 E040400 22
028 F010400 830
028 F020400 153
028 F030400 0
028 F040400 7
028 G010400 8585
028 G020400 654
028 G030400 0
028 G040400 423
<PAGE> PAGE 14
028 H000400 0
055 A000400 Y
055 B000400 N
056 000400 Y
057 000400 N
062 A000400 Y
062 B000400 112.5
062 C000400 0.0
062 D000400 0.0
062 E000400 0.0
062 F000400 0.0
062 G000400 0.0
062 H000400 0.0
062 I000400 0.0
062 J000400 0.0
062 K000400 0.0
062 L000400 0.0
062 M000400 0.0
062 N000400 0.0
062 O000400 0.0
062 P000400 0.0
062 Q000400 0.0
062 R000400 0.0
063 A000400 0
063 B000400 2.3
064 A000400 N
064 B000400 N
071 A000400 16909
071 B000400 17437
071 C000400 12559
071 D000400 135
072 A000400 12
072 B000400 1228
072 C000400 0
072 D000400 0
072 E000400 0
072 F000400 115
072 G000400 10
072 H000400 0
072 I000400 26
072 J000400 0
072 K000400 0
072 L000400 0
072 M000400 12
072 N000400 1
072 O000400 0
072 P000400 0
072 Q000400 0
072 R000400 13
072 S000400 9
072 T000400 0
<PAGE> PAGE 15
072 U000400 0
072 V000400 0
072 W000400 1
072 X000400 187
072 Y000400 64
072 Z000400 1105
072AA000400 150
072BB000400 0
072CC010400 205
072CC020400 0
072DD010400 1105
072DD020400 0
072EE000400 40
073 A010400 0.5770
073 A020400 0.0000
073 B000400 0.0156
073 C000400 0.0000
074 A000400 1
074 B000400 0
074 C000400 16252
074 D000400 10623
074 E000400 0
074 F000400 0
074 G000400 0
074 H000400 0
074 I000400 0
074 J000400 0
074 K000400 0
074 L000400 327
074 M000400 0
074 N000400 27203
074 O000400 0
074 P000400 46
074 Q000400 0
074 R010400 0
074 R020400 0
074 R030400 0
074 R040400 3263
074 S000400 0
074 T000400 23894
074 U010400 2327
074 U020400 0
074 V010400 10.27
074 V020400 0.00
074 W000400 0.0000
074 X000400 3
074 Y000400 0
075 A000400 0
075 B000400 19222
076 000400 0.00
<PAGE> PAGE 16
SIGNATURE ANN BONSTEEL
TITLE ASST. SECRETARY
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 01
<NAME> ASSET ALLOCATION FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 84739465
<INVESTMENTS-AT-VALUE> 86054060
<RECEIVABLES> 1564100
<ASSETS-OTHER> 860
<OTHER-ITEMS-ASSETS> 4758
<TOTAL-ASSETS> 87623778
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1117922
<TOTAL-LIABILITIES> 1117922
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 82609421
<SHARES-COMMON-STOCK> 7217104
<SHARES-COMMON-PRIOR> 4537205
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1863490
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2032945
<NET-ASSETS> 86505856
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 4212871
<OTHER-INCOME> 0
<EXPENSES-NET> (558805)
<NET-INVESTMENT-INCOME> 3654066
<REALIZED-GAINS-CURRENT> 8763882
<APPREC-INCREASE-CURRENT> 1203050
<NET-CHANGE-FROM-OPS> 13820998
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3654066)
<DISTRIBUTIONS-OF-GAINS> (7395696)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2314085
<NUMBER-OF-SHARES-REDEEMED> 548327
<SHARES-REINVESTED> 914141
<NET-CHANGE-IN-ASSETS> 34708915
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 495304
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 419704
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 597032
<AVERAGE-NET-ASSETS> 70201000
<PER-SHARE-NAV-BEGIN> 11.42
<PER-SHARE-NII> 0.60
<PER-SHARE-GAIN-APPREC> 1.73
<PER-SHARE-DIVIDEND> (0.60)
<PER-SHARE-DISTRIBUTIONS> (1.16)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.99
<EXPENSE-RATIO> 0.80
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 02
<NAME> GROWTH AND INCOME FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 64329849
<INVESTMENTS-AT-VALUE> 68847648
<RECEIVABLES> 3436875
<ASSETS-OTHER> 1316
<OTHER-ITEMS-ASSETS> 929
<TOTAL-ASSETS> 72286768
<PAYABLE-FOR-SECURITIES> 125118
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 217782
<TOTAL-LIABILITIES> 342900
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 64221389
<SHARES-COMMON-STOCK> 4285400
<SHARES-COMMON-PRIOR> 2176280
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3204680
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4517799
<NET-ASSETS> 71943868
<DIVIDEND-INCOME> 716607
<INTEREST-INCOME> 260785
<OTHER-INCOME> 0
<EXPENSES-NET> (344638)
<NET-INVESTMENT-INCOME> 632754
<REALIZED-GAINS-CURRENT> 6848993
<APPREC-INCREASE-CURRENT> 143053
<NET-CHANGE-FROM-OPS> 7624800
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (632754)
<DISTRIBUTIONS-OF-GAINS> (3829806)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1974920
<NUMBER-OF-SHARES-REDEEMED> 127163
<SHARES-REINVESTED> 261363
<NET-CHANGE-IN-ASSETS> 38583230
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 185493
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 318232
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 533970
<AVERAGE-NET-ASSETS> 53277000
<PER-SHARE-NAV-BEGIN> 15.34
<PER-SHARE-NII> 0.19
<PER-SHARE-GAIN-APPREC> 2.48
<PER-SHARE-DIVIDEND> (0.19)
<PER-SHARE-DISTRIBUTIONS> (1.03)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 16.79
<EXPENSE-RATIO> 0.65
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 03
<NAME> MONEY MARKET FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 18992712
<INVESTMENTS-AT-VALUE> 18992712
<RECEIVABLES> 145428
<ASSETS-OTHER> 2562
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 19140702
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4353074
<TOTAL-LIABILITIES> 4353074
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 14787628
<SHARES-COMMON-STOCK> 14787632
<SHARES-COMMON-PRIOR> 12666954
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 14787628
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 872937
<OTHER-INCOME> 0
<EXPENSES-NET> (84498)
<NET-INVESTMENT-INCOME> 788439
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 788439
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (788439)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 20957328
<NUMBER-OF-SHARES-REDEEMED> 19625090
<SHARES-REINVESTED> 788439
<NET-CHANGE-IN-ASSETS> 2120677
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 71778
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 170196
<AVERAGE-NET-ASSETS> 15963000
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (0.05)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.53
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 04
<NAME> U.S. GOVERNMENT ALLOCATION FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 26646994
<INVESTMENTS-AT-VALUE> 26875141
<RECEIVABLES> 327249
<ASSETS-OTHER> 421
<OTHER-ITEMS-ASSETS> 331
<TOTAL-ASSETS> 27203142
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3309363
<TOTAL-LIABILITIES> 3309363
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 23559783
<SHARES-COMMON-STOCK> 2327003
<SHARES-COMMON-PRIOR> 1334979
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 105849
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 228147
<NET-ASSETS> 23893779
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1228097
<OTHER-INCOME> 0
<EXPENSES-NET> (122681)
<NET-INVESTMENT-INCOME> 1105416
<REALIZED-GAINS-CURRENT> 149427
<APPREC-INCREASE-CURRENT> 204961
<NET-CHANGE-FROM-OPS> 1459804
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1105416)
<DISTRIBUTIONS-OF-GAINS> (40057)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1273335
<NUMBER-OF-SHARES-REDEEMED> 394100
<SHARES-REINVESTED> 112789
<NET-CHANGE-IN-ASSETS> 10366445
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (3521)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 115022
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 186673
<AVERAGE-NET-ASSETS> 19222000
<PER-SHARE-NAV-BEGIN> 10.13
<PER-SHARE-NII> 0.58
<PER-SHARE-GAIN-APPREC> 0.15
<PER-SHARE-DIVIDEND> (0.58)
<PER-SHARE-DISTRIBUTIONS> (0.01)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.27
<EXPENSE-RATIO> 0.64
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
[KPMG PEAT MARWICK LLP LETTERHEAD]
Independent Auditors' Report on Internal Accounting Controls
The Board of Trustees and Shareholders
Life & Annuity Trust:
In planning and performing our audit of the financial statement of Life &
Annuity Trust (comprising, Asset Allocation Fund, Growth and Income Fund, Money
Market Fund, and U.S. Government Allocation Fund) for the year ended December
31, 1997, we considered its internal control structure, including procedures
for safeguarding securities, in order to determine our auditing procedures for
the purpose of expressing our opinion on the financial statements and to comply
with the requirements of Form N-SAR, not to provide assurance on the internal
control structure.
The management of Life & Annuity Trust is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to assess the expected
benefits and related costs of internal control structure policies and
procedures. Two of the objectives of an internal control structure are to
provide management with reasonable, but not absolute, assurance that assets are
safeguarded against loss from unauthorized use or disposition and that
transactions are executed in accordance with management's authorization and
recorded properly to permit preparation of financial statements in conformity
with generally accepted accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and may not be detected. Also, projection of any
evaluation of the structure to future periods is subject to the risk that it
may become inadequate because of changes in conditions or that the
effectiveness of the design and operation may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be material
weaknesses under standards established by the American Institute of Certified
Public Accounts. A material weakness is a condition in which the design or
operation of the specific internal control structure elements does not reduce
to a relatively low level the risk that errors or irregularities in amounts
that would be material in relation to financial statements being audited may
occur and not be detected within a timely period by employees in the normal
course of performing their assigned functions. However, we noted no matters
involving the internal control structure, including procedures for safeguarding
securities, that we consider to be material weaknesses as defined above as of
December 31, 1997.
This report is intended solely for the information and use of management and
the Securities and Exchange Commission.
/s/ KPMG PEAT MARWICK LLP
February 6, 1998
