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1995 ANNUAL REPORT
T. Rowe Price Variable Annuity
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T. ROWE PRICE
VARIABLE ANNUITY
FINANCIAL STATEMENTS
PERIOD FROM MAY 1, 1995 (INCEPTION)
TO DECEMBER 31, 1995
CONTENTS
Report of Independent Auditors.................................................2
Audited Financial Statements
Balance Sheet..............................................................3
Statement of Operations and Changes in Net Assets..........................4
Notes to Financial Statements..............................................5
NOTICE OF CONTRACT OWNERS' MEETING
The annual meeting of contract owners to be held on Tuesday, June 4, 1996, at
Security Benefit Life Insurance Company, 700 SW Harrison St., Topeka, Kansas at
2:00 p.m. Each contract owner is entitled to vote, either in person or by proxy,
on all matters coming before the meeting. Proxies are available from the
corporate secretary and must be returned at least 30 days prior to the annual
meeting.
This report is submitted for the information of T. Rowe Price No-Load Variable
Annuity contract owners. The T. Rowe Price No-Load Variable Annuity (V6021) is
issued by Security Benefit Life Insurance Company.
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REPORT OF INDEPENDENT AUDITORS
The Contract Owners of T. Rowe Price Variable Annuity and
The Board of Directors of Security Benefit Life Insurance Company
We have audited the accompanying balance sheet of T. Rowe Price Variable Annuity
(the Company) as of December 31, 1995, and the related statement of operations
and changes in net assets for the period from May 1, 1995 (inception) to
December 31, 1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of investments owned as of December 31, 1995, by correspondence
with the custodian. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of T. Rowe Price Variable Annuity
at December 31, 1995, and the results of its operations and changes in its net
assets for the period from May 1, 1995 (inception) to December 31, 1995, in
conformity with generally accepted accounting principles.
Ernst & Young LLP
February 2, 1996
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BALANCE SHEET
T. Rowe Price Variable Annuity
December 31, 1995
(DOLLARS IN THOUSANDS)
ASSETS
Investments:
T. Rowe Price Portfolios:
New America Growth Portfolio - 293,778 shares at net
asset value of $15.23 per share (cost, $4,294)................... $ 4,474
International Stock Portfolio - 217,083 shares at net
asset value of $11.26 per share (cost, $2,367)................... 2,444
Equity Income Portfolio - 342,348 shares at net
asset value of $13.21 per share (cost, $4,346)................... 4,522
Personal Strategy Balanced Portfolio - 141,994 shares
at net asset value of $12.43 per share (cost, $1,724)............ 1,765
Limited-Term Bond Portfolio - 182,590 shares at net
asset value of $5.06 per share (cost, $917)...................... 924
Actuarial risk fees receivable......................................... 1
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Total assets........................................................... $14,130
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NET ASSETS
Net assets are represented by (NOTE 3):
NUMBER UNIT
OF UNITS VALUE
New America Growth Subaccount:
Accumulation units........................333,934 $13.40 $ 4,474
International Stock Subaccount:
Accumulation units........................218,427 11.19 2,444
Equity Income Subaccount:
Accumulation units........................365,712 12.37 4,522
Personal Strategy Balanced Subaccount:
Accumulation units........................148,349 11.90 1,765
Limited-Term Bond Subaccount:
Accumulation units.........................86,891 10.64 925
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Total net assets...................................................... $14,130
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SEE ACCOMPANYING NOTES.
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STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
T. Rowe Price Variable Annuity
Period from May 1, 1995 (inception) to December 31, 1995
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
NEW PERSONAL
AMERICA INTERNATIONAL EQUITY STRATEGY LIMITED-
GROWTH STOCK INCOME BALANCED TERM BOND
SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT SUBACCOUNT
<S> <C> <C> <C> <C> <C>
Dividend distributions............... $ - $ - $ 44 $ 16 $ 8
Expenses (NOTE 2):
Mortality and expense risk fee.... (4) (3) (4) (1) (1)
------ ------ ------ ------ ------
Net investment income (loss)......... (4) (3) 40 15 7
Realized gain (loss) on
investments........................ 48 (8) 41 7 1
Unrealized appreciation
on investments..................... 180 77 176 41 7
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Net realized and unrealized
gain on investments................ 228 69 217 48 8
------ ------ ------ ------ ------
Net increase in net assets
resulting from operations.......... 224 66 257 63 15
Net assets at beginning of period.... - - - - -
Variable annuity
deposits (NOTES 2 AND 3)........... 4,279 2,410 4,348 1,714 1,182
Terminations and
withdrawals (NOTES 2 AND 3)........ (29) (32) (83) (12) (272)
------ ------ ------ ------ ------
Net assets at end of period.......... $4,474 $2,444 $4,522 $1,765 $ 925
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</TABLE>
SEE ACCOMPANYING NOTES.
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NOTES TO FINANCIAL STATEMENTS
T. Rowe Price No-Load Variable Annuity
December 31, 1995
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
T. Rowe Price Variable Annuity (the Account) is a separate account of Security
Benefit Life Insurance Company (SBL). The Account is registered as a unit
investment trust under the Investment Company Act of 1940, as amended. All
deposits received by the Account have been invested in one of the portfolios of
either T. Rowe Price Equity Series, Inc., T. Rowe Price Fixed Income Series,
Inc., or T. Rowe Price International Series, Inc., mutual funds not otherwise
available to the public. As directed by the owners, amounts deposited are
invested in shares of New America Growth Portfolio - emphasis on long-term
capital growth through investments in common stocks of domestic companies,
International Stock Portfolio - emphasis on long-term capital growth through
investments in common stocks of established foreign companies, Equity Income
Portfolio - emphasis on substantial dividend income and capital appreciation by
investing primarily in dividend-paying common stocks, Personal Strategy Balanced
Portfolio - emphasis on both capital appreciation and income, and Limited-Term
Bond Portfolio - emphasis on income with moderate price fluctuation by investing
in short- and intermediate-term securities.
Under the terms of the investment advisory contracts, portfolio investments are
made by T. Rowe Price Associates, Inc., for each portfolio except those of the
T. Rowe Price International Stock Portfolio, which is advised by Rowe
Price-Fleming International, Inc., an affiliate of T. Rowe Price Associates,
Inc.
INVESTMENT VALUATION
Investments in mutual fund shares are carried in the balance sheet at market
value (net asset value of the underlying mutual fund). The first-in, first-out
cost method is used to determine gains and losses. Security transactions are
accounted for on the trade date.
The cost of investments purchased and proceeds from investments sold during the
period from May 1, 1995 (inception) to December 31,1995 were as follows:
COST OF PROCEEDS
PURCHASES FROM SALES
(IN THOUSANDS)
New America Growth Portfolio $4,685 $439
International Stock Portfolio 2,698 323
Equity Income Portfolio 4,967 662
Personal Strategy Balanced Portfolio 1,952 235
Limited-Term Bond Portfolio 1,237 321
ANNUITY RESERVES
As of December 31, 1995, annuity reserves have not been established because
there are no contracts which have matured and are in the payout stage. Such
reserves would be computed on the basis of published mortality tables using
assumed interest rates that will provide reserves as prescribed by law. In cases
where the payout option selected is life contingent, SBL periodically
recalculates the required annuity reserves, and any resulting adjustment is
either charged or credited to SBL and not to the Account.
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NOTES TO FINANCIAL STATEMENTS (cont.)
REINVESTMENT OF DIVIDENDS
Dividend and capital gains distributions paid by the mutual fund to the Account
are reinvested in additional shares of each respective portfolio. Dividend
income and capital gain distributions are recorded as income on the ex-dividend
date.
FEDERAL INCOME TAXES
Under current law, no federal income taxes are payable with respect to the
Account.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
2. VARIABLE ANNUITY CONTRACT CHARGES
Mortality and expense risks assumed by SBL are compensated for by a fee
equivalent to an annual rate of .55% of the average daily net assets of each
account.
When applicable, an amount for state premium taxes is deducted as provided by
pertinent state law, either from the purchase payments or from the amount
applied to effect an annuity at the time annuity payments commence.
3. SUMMARY OF UNIT TRANSACTIONS
Unit transactions during the period from May 1, 1995 (inception) to December 31,
1995, were as follows (IN THOUSANDS):
New America Growth Subaccount:
Variable annuity deposits 336
Terminations and withdrawals 2
International Stock Subaccount:
Variable annuity deposits 221
Terminations and withdrawals 3
Equity Income Subaccount:
Variable annuity deposits 373
Terminations and withdrawals 7
Personal Strategy Balanced Subaccount:
Variable annuity deposits 149
Terminations and withdrawals 1
Limited-Term Bond Subaccount:
Variable annuity deposits 113
Terminations and withdrawals 26
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