<PAGE> 1
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
- - ------------------------------------------------------
VARIABLE ACCOUNT B
CLASS 3
FINANCIAL STATEMENTS
FOR THE PERIODS ENDED
DECEMBER 31, 1995
This report has been prepared to provide information to owners of American
Skandia Life Assurance Corporation's AxiomSM Variable Annuity. If it is used for
any other purpose, it must be accompanied or preceded by a current AxiomSM
Variable Annuity prospectus, which discloses any charges and other important
information about the Account, together with the current applicable prospectus
for the Neuberger & Berman Advisors Management Trust, The Alger American Fund or
the American Skandia Trust.
<PAGE> 2
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
PRESIDENT'S LETTER
FEBRUARY, 1996
Dear Contractholder:
What a year it was! The New York Stock Exchange hit a record high on 69 days, a
record number of record highs! The performance of the Variable Account B
sub-accounts also reflects these outstanding investment returns. Please read the
attached sub-account managers' reports carefully, for a better appreciation of
how your mutual fund investment options performed in 1995, and their respective
outlooks for 1996.
As we look ahead, we do not expect to repeat the stellar results of 1995. But
neither do we anticipate a dramatic sell off or cause for a collapse of those
prior gains. Instead we anticipate a "normal" investment climate, with "normal"
levels of returns, and "normal" volatility in returns. As before, our conviction
is that a winning strategy must include a long term view, and a diversified
approach to asset classes and investment markets. Our commitment is to offer a
choice of excellent managers and excellent funds in a wide range of asset
classes.
In the years past we have focused on adding asset class and investment style
choices to your retirement annuity. In 1995 we added the following four new
selections:
<TABLE>
<CAPTION>
SUB-ACCOUNT ASSET CLASS/INVESTMENT STYLE
- - -------------------------------- -----------------------------------------------
<S> <C>
Seligman-Henderson Small Cap International Equities (small capitalization)
T. Rowe Price Natural Resources "Hard Assets"
PIMCO Limited Bond Intermediate Bonds
Neuberger & Berman Partners Value Style Equities
</TABLE>
These new selections have proven to be very popular, and the new portfolios
raised over $120 million of new assets in 1995.
Gordon C. Boronow
<PAGE> 3
<TABLE>
<S> <C>
CONTENTS
I. American Skandia Life Assurance Corporation
II. The Alger American Fund
III. Neuberger & Berman Advisors Management Trust
IV. American Skandia Trust
</TABLE>
<PAGE> 4
INDEPENDENT AUDITORS' REPORT
- - -------------------------------------
To the Contractowners of
American Skandia Life Assurance Corporation
Variable Account B -- Class 3 (Axiom Variable Annuity) and the
Board of Directors of
American Skandia Life Assurance Corporation
Shelton, Connecticut
We have audited the accompanying statement of assets and liabilities of the
twenty-one sub-accounts of American Skandia Life Assurance Corporation Variable
Account B -- Class 3, referred to in Note 1, as of December 31, 1995, and the
related statements of operations and of changes in net assets for the periods
presented. 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 audits.
We conducted our audits 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 securities owned as of December 31, 1995 with the managers of
the mutual funds. 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 audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of the twenty-one sub-accounts of American
Skandia Life Assurance Corporation Variable Account B -- Class 3, referred to in
Note 1, as of December 31, 1995, the results of their operations and the changes
in their net assets for the periods presented in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
February 20, 1996
<PAGE> 5
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF ASSETS AND LIABILITIES
AS OF DECEMBER 31, 1995
- - --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investment in mutual funds at market value (Note 2):
Neuberger & Berman Advisers Management Trust (NBAMT):
Partners Portfolio - 31,834 shares (cost $405,402)..................................................... $ 421,164
The Alger American Fund (AAF):
Small Capitalization Portfolio - 33,852 shares (cost $1,379,408)....................................... 1,334,124
Growth Portfolio - 72,075 shares (cost $2,251,804)..................................................... 2,245,870
MidCap Growth Portfolio - 33,678 shares (cost $656,768)................................................ 654,705
American Skandia Trust (AST):
Seligman Henderson International Growth Portfolio - 30,868 shares (cost $539,667)...................... 561,800
Seligman Henderson International Small Cap Portfolio - 41,299 shares (cost $421,922)................... 426,615
Lord Abbett Growth & Income Portfolio - 129,194 shares (cost $1,852,835)............................... 1,935,324
JanCap Growth Portfolio - 55,832 shares (cost $841,963)................................................ 859,820
Money Market Portfolio - 5,758,768 shares (cost $5,758,768)............................................ 5,758,768
Federated Utility Income Portfolio - 8,121 shares (cost $89,570)....................................... 96,962
Federated High Yield Portfolio - 212,515 shares (cost $2,295,152)...................................... 2,367,418
Phoenix Balanced Asset Portfolio - 27,880 shares (cost $330,642)....................................... 349,336
T. Rowe Price Asset Allocation Portfolio - 20,685 shares (cost $238,805)............................... 248,428
T. Rowe Price International Equity Portfolio - 266,356 shares (cost $2,761,591)........................ 2,836,691
T. Rowe Price Natural Resources - 5,652 shares (cost $59,251).......................................... 62,799
Founders Capital Appreciation Portfolio - 173,813 shares (cost $2,408,771)............................. 2,476,832
INVESCO Equity Income Portfolio - 145,731 shares (cost $1,702,123)..................................... 1,821,640
PIMCO Total Return Bond Portfolio - 90,751 shares (cost $979,374)...................................... 1,029,119
PIMCO Limited Maturity Bond Portfolio - 149,908 shares (cost $1,524,426)............................... 1,569,541
Scudder International Bond Portfolio - 24,563 shares (cost $254,114)................................... 260,369
Berger Capital Growth Portfolio - 19,580 shares (cost $233,429)........................................ 242,795
-----------
Total Invested Assets.......................................................................... 27,560,120
Receivable from American Skandia Life Assurance Corp........................................................... 3,684,283
-----------
Total Assets................................................................................... $31,244,403
===========
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
2
<PAGE> 6
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF ASSETS AND LIABILITIES (CONCLUDED)
AS OF DECEMBER 31, 1995
- - --------------------------------------------------------------------------------
<TABLE>
<S> <C>
LIABILITIES
Payable to American Skandia Trust............................................................................... $3,663,591
Payable to Neuberger & Berman Advisers Management Trust......................................................... 925
Payable to The Alger American Fund.............................................................................. 20,725
----------
Total Liabilities............................................................................... $3,685,241
----------
</TABLE>
NET ASSETS
<TABLE>
<CAPTION>
UNIT
CONTRACTOWNERS' EQUITY UNITS VALUE
- - ----------------------------------------------------------------------------------------- ------- ------
<S> <C> <C> <C>
NBAMT - Partners..................................................................... 34,867 $12.08 $ 421,164
AAF - Small Capitalization........................................................... 104,247 12.80 1,334,124
AAF - Growth......................................................................... 185,142 12.13 2,245,809
AAF - MidCap Growth.................................................................. 50,878 12.87 654,653
AST - Seligman Henderson International Growth........................................ 51,519 10.90 561,769
AST - Seligman Henderson International Small Cap..................................... 41,575 10.26 426,615
AST - Lord Abbett Growth & Income.................................................... 168,290 11.50 1,935,271
AST - JanCap Growth.................................................................. 68,509 12.55 859,751
AST - Money Market................................................................... 559,358 10.30 5,758,707
AST - Federated Utility Income....................................................... 8,260 11.73 96,901
AST - Federated High Yield........................................................... 216,497 10.93 2,367,354
AST - Phoenix Balanced Asset......................................................... 30,506 11.45 349,309
AST - T. Rowe Price Asset Allocation................................................. 22,113 11.23 248,414
AST - T. Rowe Price International Equity............................................. 265,448 10.69 2,836,615
AST - T. Rowe Price Natural Resources................................................ 5,683 11.04 62,717
AST - Founders Capital Appreciation.................................................. 203,315 12.18 2,476,765
AST - INVESCO Equity Income.......................................................... 155,507 11.71 1,821,640
AST - PIMCO Total Return Bond........................................................ 92,538 11.12 1,029,035
AST - PIMCO Limited Maturity Bond.................................................... 150,910 10.40 1,569,541
AST - Scudder International Bond..................................................... 24,422 10.66 260,273
AST - Berger Capital Growth.......................................................... 20,219 12.01 242,735
----------
Total Net Assets......................................................... $27,559,162
==========
</TABLE>
- - --------------------------------------------------------------------------------
3
<PAGE> 7
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF OPERATIONS
FOR THE PERIODS ENDED DECEMBER 31, 1995
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
-------------------------------------
NBAMT
PARTNERS
(MAY 25* THRU
DEC. 31,
TOTAL 1995)
----------- -------------
<S> <C> <C>
INVESTMENT INCOME:
Income
Dividends.......................................................................... $ 69,245 $ 0
Expenses
Mortality and Expense Risks Charges and Administrative Fees (Note 4)............... (78,617) (1,051)
----------- -------
NET INVESTMENT INCOME (LOSS)........................................................... (9,372) (1,051)
----------- -------
REALIZED GAIN ON INVESTMENTS:
Proceeds From Sales.................................................................. 12,270,712 46,740
Cost of Securities Sold.............................................................. 12,173,684 41,820
----------- -------
Net Gain........................................................................... 97,028 4,920
Capital Gain Distributions Received.................................................. 0 0
----------- -------
NET REALIZED GAIN...................................................................... 97,028 4,920
UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Beginning of Period.................................................................. 0 0
End of Period........................................................................ 574,335 15,762
----------- -------
NET UNREALIZED GAIN (LOSS)............................................................. 574,335 15,762
----------- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 661,991 $19,631
=========== =======
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
4
<PAGE> 8
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
- - --------------------------------------------------------------------------------------------------------------
AST - SELIGMAN
AAF - SMALL AAF - MIDCAP AST - SELIGMAN HENDERSON AST - LORD
CAPITALIZATION AAF - GROWTH GROWTH HENDERSON INTL. SMALL ABBETT GROWTH
(MAY 17* THRU (MAY 17* THRU (MAY 24* THRU INTL. EQUITY CAP & INCOME
DEC. 31, DEC. 31, DEC. 31, (MAY 25* THRU (MAY 25* THRU (JUN. 8* THRU
1995) 1995) 1995) DEC. 31, 1995) DEC. 31, 1995) DEC. 31, 1995)
------------- ------------- ------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
$ 0 $ 0 $ 0 $ 0 $ 0 $ 0
(3,635) (7,151) (1,627) (1,461) (731) (4,331)
-------- -------- ------- ------- ------ -------
(3,635) (7,151) (1,627) (1,461) (731) (4,331)
-------- -------- ------- ------- ------ -------
238,425 108,875 20,161 14,962 6,207 38,086
231,233 94,553 16,565 14,136 6,046 35,817
-------- -------- ------- ------- ------ -------
7,192 14,322 3,596 826 161 2,269
0 0 0 0 0 0
-------- -------- ------- ------- ------ -------
7,192 14,322 3,596 826 161 2,269
0 0 0 0 0 0
(45,284) (5,934) (2,063) 22,133 4,693 82,489
-------- -------- ------- ------- ------ -------
(45,284) (5,934) (2,063) 22,133 4,693 82,489
-------- -------- ------- ------- ------ -------
$ (41,727) $ 1,237 $ (94) $ 21,498 $4,123 $ 80,427
======== ======== ======= ======= ====== =======
</TABLE>
- - --------------------------------------------------------------------------------
5
<PAGE> 9
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF OPERATIONS (CONT'D)
FOR THE PERIODS ENDED DECEMBER 31, 1995
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
-------------------------------------------
AST - JANCAP
GROWTH
(MAY 19* THRU AST - MONEY MARKET
DEC. 31, (MAY 19* THRU
1995) DEC. 31, 1995)
------------- ------------------
<S> <C> <C>
INVESTMENT INCOME:
Income
Dividends.................................................................. $ 0 $ 69,245
Expenses
Mortality and Expense Risks Charges and Administrative Fees (Note 4)....... (2,099) (13,113)
------- ----------
NET INVESTMENT INCOME (LOSS)................................................... (2,099) 56,132
------- ----------
REALIZED GAIN ON INVESTMENTS:
Proceeds from Sales.......................................................... 27,603 7,623,146
Cost of Securities Sold...................................................... 23,199 7,623,146
------- ----------
Net Gain................................................................... 4,404 0
Capital Gain Distributions Received.......................................... 0 0
------- ----------
NET REALIZED GAIN.............................................................. 4,404 0
UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Beginning of Period.......................................................... 0 0
End of Period................................................................ 17,857 0
------- ----------
NET UNREALIZED GAIN (LOSS)..................................................... 17,857 0
------- ----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS................ $20,162 $ 56,132
======= ==========
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
6
<PAGE> 10
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
-----------------------------------------------------------------------------------------------
AST - T. ROWE
AST - PHOENIX PRICE ASSET
BALANCED ALLOCATION AST - T. ROWE
AST - FEDERATED AST - FEDERATED ASSET (JUN. 13* PRICE INTERNATIONAL
UTILITY INCOME HIGH YIELD (JUN. 2* THRU THRU EQUITY
(JUN. 20* THRU (JUN. 13* THRU DEC. 31, DEC. 31, (MAY 30* THRU
DEC. 31, 1995) DEC. 31, 1995) 1995) 1995) DEC. 31, 1995)
--------------- --------------- ------------- ------------- -------------------
<S> <C> <C> <C> <C> <C>
$ 0 $ 0 $ 0 $ 0 $ 0
(269) (4,877) (784) (654) (6,138)
------ ------- ------- ------- --------
(269) (4,877) (784) (654) (6,138)
------ ------- ------- ------- --------
3,795 41,539 27,043 14,903 128,287
3,727 39,410 26,124 14,524 122,064
------ ------- ------- ------- --------
68 2,129 919 379 6,223
0 0 0 0 0
------ ------- ------- ------- --------
68 2,129 919 379 6,223
0 0 0 0 0
7,392 72,266 18,694 9,623 75,100
------ ------- ------- ------- --------
7,392 72,266 18,694 9,623 75,100
------ ------- ------- ------- --------
$ 7,191 $69,518 $18,829 $ 9,348 $ 75,185
====== ======= ======= ======= ========
</TABLE>
- - --------------------------------------------------------------------------------
7
<PAGE> 11
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF OPERATIONS (CONCLUDED)
FOR THE PERIODS ENDED DECEMBER 31, 1995
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
----------------------------------------
AST - T. ROWE
PRICE NATURAL
RESOURCES AST - FOUNDERS
(JUN. 21* CAPITAL
THRU APPRECIATION
DEC. 31, (MAY 16* THRU
1995) DEC. 31, 1995)
------------- --------------
<S> <C> <C>
INVESTMENT INCOME:
Income
Dividends...................................................................... $ 0 $ 0
Expenses
Mortality and Expense Risks Charges and Administrative Fees (Note 4)........... (188) (5,707)
---- ----
NET INVESTMENT INCOME (LOSS)....................................................... (188) (5,707)
---- ----
REALIZED GAIN ON INVESTMENTS:
Proceeds From Sales.............................................................. 104 22,305
Cost of Securities Sold.......................................................... 100 19,335
---- ----
Net Gain....................................................................... 4 2,970
Capital Gain Distributions Received.............................................. 0 0
---- ----
NET REALIZED GAIN.................................................................. 4 2,970
UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Beginning of Period.............................................................. 0 0
End of Period.................................................................... 3,548 68,061
---- ----
NET UNREALIZED GAIN (LOSS)......................................................... 3,548 68,061
---- ----
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS.................... $ 3,364 $ 65,324
==== ====
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
8
<PAGE> 12
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
- - --------------------------------------------------------------------------------------------
AST - PIMCO AST - SCUDDER AST - BERGER
AST - INVESCO TOTAL RETURN AST - PIMCO INTERNATIONAL CAPITAL
EQUITY INCOME BOND LIMITED MATURITY BOND GROWTH
(MAY 22* THRU (MAY 17* THRU BOND (MAY 16* THRU (MAY 17* THRU
DEC. 31, DEC. 31, (MAY 22* THRU DEC. 31, DEC. 31,
1995) 1995) DEC. 31, 1995) 1995) 1995)
------------- ------------- ---------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
$ 0 $ 0 $ 0 $ 0 $ 0
(5,128) (3,705) (14,542) (611) (815)
-------- -------- ---------- ------- -------
(5,128) (3,705) (14,542) (611) (815)
-------- -------- ---------- ------- -------
48,340 345,621 3,471,476 12,937 30,157
43,792 339,561 3,439,351 12,860 26,321
-------- -------- ---------- ------- -------
4,548 6,060 32,125 77 3,836
0 0 0 0 0
-------- -------- ---------- ------- -------
4,548 6,060 32,125 77 3,836
0 0 0 0 0
119,517 49,745 45,115 6,255 9,366
-------- -------- ---------- ------- -------
119,517 49,745 45,115 6,255 9,366
-------- -------- ---------- ------- -------
$ 118,937 $ 52,100 $ 62,698 $ 5,721 $12,387
======== ======== ========== ======= =======
</TABLE>
- - --------------------------------------------------------------------------------
9
<PAGE> 13
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF CHANGES IN NET ASSETS
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
-------------------------------------
NBAMT
TOTAL PARTNERS
------------ ------------
PERIOD ENDED MAY 25* THRU
DEC. 31, DEC. 31,
1995 1995
------------ ------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net Investment Income (Loss)..................................................... $ (9,372) $ (1,051)
Net Realized Gain (Loss)......................................................... 97,028 4,920
Net Unrealized Gain (Loss) On Investments........................................ 574,335 15,762
---------- -------
Net Increase (Decrease) In Net Assets Resulting From Operations.................. 661,991 19,631
---------- -------
CAPITAL SHARE TRANSACTIONS:
Transfers of Annuity Fund Deposits............................................... 26,406,324 302,899
Net Transfers Between Sub-accounts............................................... 550,186 98,261
Surrenders....................................................................... (59,339) 373
---------- -------
Net Increase In Net Assets Resulting From Capital Share Transactions............. 26,897,171 401,533
---------- -------
TOTAL INCREASE IN NET ASSETS......................................................... 27,559,162 421,164
NET ASSETS:
Beginning of Period.............................................................. 0 0
---------- -------
End of Period.................................................................... $27,559,162 $421,164
========== =======
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
10
<PAGE> 14
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
- - ----------------------------------------------------------------------------------------------------------
AST - SELIGMAN
AAF - SMALL AAF AAF - MIDCAP AST - SELIGMAN HENDERSON AST
CAPITALIZATION GROWTH GROWTH HENDERSON INTL. SMALL LORD ABBETT
------------ ------------ ------------ INTL. EQUITY CAP GROWTH & INC.
MAY 17* THRU MAY 17* THRU MAY 24* THRU -------------- -------------- ------------
DEC. 31, DEC. 31, DEC. 31, MAY 25* THRU MAY 25* THRU JUN. 8* THRU
1995 1995 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
------------ ------------ ------------ -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ (3,635) $ (7,151) $ (1,627) $ (1,461) $ (731) $ (4,331)
7,192 14,322 3,596 826 161 2,269
(45,284) (5,934) (2,063) 22,133 4,693 82,489
------- -------- ------- ------- ------- --------
(41,727) 1,237 (94) 21,498 4,123 80,427
------- -------- ------- ------- ------- --------
1,098,502 2,100,319 587,809 335,177 367,112 468,299
280,051 167,200 74,235 204,474 55,435 1,368,348
(2,702) (22,947) (7,297) 620 (55) 18,197
------- -------- ------- ------- ------- --------
1,375,851 2,244,572 654,747 540,271 422,492 1,854,844
------- -------- ------- ------- ------- --------
1,334,124 2,245,809 654,653 561,769 426,615 1,935,271
0 0 0 0 0 0
------- -------- ------- ------- ------- --------
$1,334,124 $2,245,809 $654,653 $561,769 $426,615 $ 1,935,271
======= ======== ======= ======= ======= ========
</TABLE>
- - --------------------------------------------------------------------------------
11
<PAGE> 15
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF CHANGES IN NET ASSETS (CONT'D)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
--------------------------------------
AST
AST MONEY MARKET
JANCAP GROWTH ------------
------------- MAY 19* THRU
MAY 19* THRU DEC. 31,
DEC. 31, 1995 1995
------------- ------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net Investment Income (Loss)..................................................... $ (2,099) $ 56,132
Net Realized Gain (Loss)......................................................... 4,404 0
Net Unrealized Gain (Loss) On Investments........................................ 17,857 0
------- -----------
Net Increase (Decrease) In Net Assets Resulting From Operations.................. 20,162 56,132
------- -----------
CAPITAL SHARE TRANSACTIONS:
Transfers of Annuity Fund Deposits............................................... 620,832 13,797,192
Net Transfers Between Sub-accounts............................................... 219,658 (8,045,900)
Surrenders....................................................................... (901) (48,717)
------- -----------
Net Increase In Net Assets Resulting From Capital Share Transactions............. 839,589 5,702,575
------- -----------
TOTAL INCREASE IN NET ASSETS......................................................... 859,751 5,758,707
NET ASSETS:
Beginning of Period.............................................................. 0 0
------- -----------
End of Period.................................................................... $ 859,751 $ 5,758,707
======= ===========
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
12
<PAGE> 16
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
------------------------------------------------------------------------------------------------------------
AST - T. ROWE AST - T. ROWE AST - T. ROWE
AST - FEDERATED AST - FEDERATED AST - PHOENIX PRICE ASSET PRICE INTL. PRICE NATURAL
UTILITY INCOME HIGH YIELD BALANCED ASSET ALLOCATION EQUITY RESOURCES
--------------- --------------- ------------- ------------- ------------- -------------
JUN. 20* THRU JUN. 13* THRU JUN. 2* THRU JUN. 13* THRU MAY 30* THRU JUN. 21* THRU
DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
--------------- --------------- -------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ (269) $ (4,877) $ (784) $ (654) $ (6,138) $ (188)
68 2,129 919 379 6,223 4
7,392 72,266 18,694 9,623 75,100 3,548
------- -------- -------- ------- ------- ------
7,191 69,518 18,829 9,348 75,185 3,364
------- -------- -------- ------- ------- ------
73,502 275,751 303,175 191,553 798,237 38,399
16,244 2,014,925 38,588 47,655 1,964,129 20,943
(36) 7,160 (11,283) (142) (936) 11
------- -------- -------- ------- ------- ------
89,710 2,297,836 330,480 239,066 2,761,430 59,353
------- -------- -------- ------- ------- ------
96,901 2,367,354 349,309 248,414 2,836,615 62,717
0 0 0 0 0 0
------- -------- -------- ------- ------- ------
$96,901 $ 2,367,354 $349,309 $ 248,414 $ 2,836,615 $62,717
======= ======== ======== ======= ======= ======
</TABLE>
- - --------------------------------------------------------------------------------
13
<PAGE> 17
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
STATEMENT OF CHANGES IN NET ASSETS (CONCLUDED)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
------------------------------------------
AST - FOUNDERS
CAPITAL AST - INVESCO
APPRECIATION EQUITY INCOME
-------------- -------------
MAY 16* THRU MAY 22* THRU
DEC. 31, 1995 DEC. 31, 1995
-------------- -------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net Investment Income (Loss).............................................. $ (5,707) $ (5,128)
Net Realized Gain (Loss).................................................. 2,970 4,548
Net Unrealized Gain (Loss) On Investments................................. 68,061 119,517
---------- ----------
Net Increase (Decrease) In Net Assets Resulting From Operations........... 65,324 118,937
---------- ----------
CAPITAL SHARE TRANSACTIONS:
Transfers of Annuity Fund Deposits........................................ 741,715 1,345,090
Net Transfers Between Sub-accounts........................................ 1,652,865 366,022
Surrenders................................................................ 16,861 (8,409)
---------- ----------
Net Increase In Net Assets Resulting From Capital Share Transactions...... 2,411,441 1,702,703
---------- ----------
TOTAL INCREASE IN NET ASSETS.................................................. 2,476,765 1,821,640
NET ASSETS:
Beginning of Period....................................................... 0 0
---------- ----------
End of Period............................................................. $2,476,765 $ 1,821,640
========== ==========
</TABLE>
- - --------------------------------------------------------------------------------
See Notes to Financial Statements.
* Date Operations Commenced.
14
<PAGE> 18
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS 3 SUB-ACCOUNTS INVESTING IN:
---------------------------------------------------------------------
AST - PIMCO
TOTAL
RETURN
BOND AST - PIMCO AST - SCUDDER
----------- LIMITED MATURITY INTERNATIONAL AST - BERGER
MAY 17* BOND BOND CAPITAL GROWTH
THRU --------------- ------------- -------------
DEC. 31, MAY 22* THRU MAY 16* THRU MAY 17* THRU
1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
----------- ---------------- ------------- --------------
<S> <C> <C> <C> <C>
$ (3,705) $ (14,542) $ (611) $ (815)
6,060 32,125 77 3,836
49,745 45,115 6,255 9,366
---------- ---------- -------- --------
52,100 62,698 5,721 12,387
---------- ---------- -------- --------
1,132,056 1,489,817 181,092 157,796
(154,597) 16,926 73,460 71,264
(524) 100 0 1,288
---------- ---------- -------- --------
976,935 1,506,843 254,552 230,348
---------- ---------- -------- --------
1,029,035 1,569,541 260,273 242,735
0 0 0 0
---------- ---------- -------- --------
$1,029,035 $1,569,541 $ 260,273 $242,735
========== ========== ======== ========
</TABLE>
- - --------------------------------------------------------------------------------
15
<PAGE> 19
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
NOTES TO
FINANCIAL STATEMENTS
- - --------------------------------------------------------------------------------
1. ORGANIZATION
American Skandia Life Assurance Corporation Variable Account B -- Class 3 (the
"Account") is a separate investment account of American Skandia Life Assurance
Corporation ("American Skandia"). The Account is registered with the SEC under
the Investment Company Act of 1940 as a unit investment trust. The Account
commenced operations May 1, 1995.
As of December 31, 1995 the Account consisted of twenty-five sub-accounts. These
financial statements report on twenty-one sub-accounts offered in the Axiom
Variable Annuity. Each of the twenty-one sub-accounts invests only in a single
corresponding portfolio of either the Neuberger and Berman Advisers Management
Trust, The Alger American Fund or the American Skandia Trust (the "Trusts").
Neuberger and Berman Management, Inc. is the advisor for the Neuberger and
Berman Advisers Management Trust. Fred Alger Management, Inc. is the advisor for
The Alger American Fund. American Skandia Investment Services, Incorporated is
the investment manager for American Skandia Trust, while Seligman Henderson Co.,
Lord Abbett & Co., Janus Capital Corporation, J. P. Morgan Investment Management
Incorporated, Federated Investment Counseling, Phoenix Investment Counsel, Inc.,
T. Rowe Price Associates, Inc., Rowe Price-Fleming International, Inc., Founders
Asset Management, Inc., INVESCO Trust Company, Pacific Investment Management
Company, Scudder, Stevens & Clark, Inc. and Berger Associates, Inc. are the sub-
advisors. The investment advisors are paid fees for their services by the
respective Trusts.
The following twenty-one sub-accounts have commenced operations during 1995: the
NBAMT-Partners on May 25, 1995; the AAF-Small Capitalization on May 17, 1995;
the AAF-Growth on May 17, 1995; the AAF-MidCap Growth on May 24, 1995; the AST-
Seligman Henderson International Equity on May 25, 1995; the AST-Seligman
Henderson International Small Cap on May 25, 1995; the AST-Lord Abbett Growth &
Income on June 8, 1995; the AST-JanCap Growth on May 19, 1995; the AST-Money
Market on May 19, 1995; the AST-Federated Utility Income on June 20, 1995; the
AST-Federated High Yield on June 13, 1995; the AST-Phoenix Balanced Asset on
June 2, 1995; the AST-T. Rowe Price Asset Allocation on June 13, 1995; the
AST-T. Rowe Price International Equity on May 30, 1995; the AST-T. Rowe Price
Natural Resources on June 21, 1995; the AST-Founders Capital Appreciation on May
16, 1995; the AST-INVESCO Equity Income on May 22, 1995; the AST-PIMCO Total
Return Bond on May 17, 1995; the AST-PIMCO Limited Maturity Bond on May 22,
1995; the AST-Scudder International Bond on May 16, 1995 and the AST-Berger
Capital Growth on May 17, 1995.
2. VALUATION OF INVESTMENTS
The market value of the investments in the sub-accounts is based on the net
asset values of the Trust shares held at the end of the current period.
Transactions are accounted for on the trade date and dividend income is
recognized on an accrual basis. Realized gains and losses on sales of
investments are determined on a first-in first-out basis.
3. INCOME TAXES
American Skandia does not expect to incur any Federal income tax liability on
earnings, or realized capital gains attributable to the Account, therefore, no
charges for Federal income taxes are currently deducted from the Account. If
American Skandia incurs income taxes attributable to the Account, or determines
that such taxes will be incurred, it may make a charge for such taxes against
the Account.
Under current laws, American Skandia may incur state and local income taxes (in
addition to premium tax) in several states. The company does not anticipate that
these will be significant. However, American Skandia
16
<PAGE> 20
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
NOTES TO
FINANCIAL STATEMENTS (CONT'D)
- - --------------------------------------------------------------------------------
may make charges to the Account in the event that the amount of these taxes
change.
4. CONTRACT CHARGES
The following contract charges are paid to American Skandia:
Mortality and Expense Risk Charges -- Charged daily against the Account at
an annual rate of 0.85% of the net assets.
Administrative Fees -- Charged daily against the Account at an annual rate
of .15% of the net assets. A maintenance fee equaling the smaller of $35 or
2% of the current Account Value is deducted at the end of each contract
year and on surrender.
Transfer Fees -- Charged at a rate of $10 for each transfer after the
fourth in each annuity year.
Contingent Deferred Sales Charges are computed as set forth in the Axiom
Variable Annuity. These charges may be imposed on the full, or partial
surrender of certain contracts. There is no contingent deferred sales
charge if all premiums were received at least seven complete years prior to
the date of the full or partial surrender.
17
<PAGE> 21
AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
VARIABLE ACCOUNT B -- CLASS 3
NOTES TO
FINANCIAL STATEMENTS (CONCLUDED)
- - --------------------------------------------------------------------------------
5. CHANGES IN THE UNITS OUTSTANDING
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
CLASS 3 SUB-ACCOUNTS INVESTING IN:
--------------------------------------------------------------------------------
NBAMT AAF - SMALL AAF
PARTNERS CAPITALIZATION AAF - GROWTH MIDCAP GROWTH
----------- ----------------- -------------- -----------------
MAY, 25* THRU MAY, 17* THRU MAY, 17* THRU MAY, 24* THRU
DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
-------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Units Outstanding Beginning of the Period........ 0 0 0 0
Units Purchased.................................. 26,056 83,398 173,071 45,727
Units Transferred Between Sub-accounts........... 8,811 21,082 13,785 5,681
Units Surrendered................................ 0 (233) (1,714) (530)
------ ----- ------ -----
Units Outstanding End of the Period.............. 34,867 104,247 185,142 50,878
====== ===== ====== =====
<CAPTION>
--------------------------------------------------------------------------------
CLASS 3 SUB-ACCOUNTS INVESTING IN:
--------------------------------------------------------------------------------
AST - PHOENIX AST - T. ROWE PRICE AST - T. ROWE AST - T. ROWE PRICE
BALANCED ASSET ASSET ALLOCATION PRICE INTL. EQUITY NATURAL RESOURCES
----------- ----------------- -------------- -----------------
JUN. 2* THRU JUN. 13* THRU MAY 30* THRU JUN. 21* THRU
DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
-------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Units Outstanding Beginning of the Period........ 0 0 0 0
Units Purchased.................................. 28,098 17,865 76,823 3,711
Units Transferred Between Sub-accounts........... 3,442 4,259 188,642 1,972
Units Surrendered................................ (1,034) (11) (17) 0
------ ----- ------ -----
Units Outstanding End of the Period.............. 30,506 22,113 265,448 5,683
====== ===== ====== =====
</TABLE>
- - --------------------------------------------------------------------------------
* Date Operations Commenced.
18
<PAGE> 22
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- - -----------------------------------------------------------------------------------------------------------------------------------
CLASS 3 SUB-ACCOUNTS INVESTING IN:
- - -----------------------------------------------------------------------------------------------------------------------------------
AST - SELIGMAN AST - SELIGMAN AST - LORD ABBETT AST AST AST - FEDERATED
HEND. INTL. EQUITY HEND. INTL. SM CAP GROWTH & INCOME JANCAP GROWTH MONEY MARKET UTILITY INCOME
-------------- --------------- ----------------- ---------------- -------------- -------------
MAY 25* THRU MAY 25* THRU JUN. 8* THRU MAY 19* THRU MAY 19* THRU JUN. 20* THRU
DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
------------------ ------------------ ----------------- ---------------- ------------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
0 0 0 0 0 0
32,142 36,504 43,269 50,863 1,356,883 6,841
19,377 5,078 125,110 17,758 (794,083) 1,426
0 (7) (89) (112) (3,442) (7)
------ ------ ------ ------- -------- -----
51,519 41,575 168,290 68,509 559,358 8,260
====== ====== ====== ======= ======== =====
<CAPTION>
- - -----------------------------------
CLASS 3 SUB-ACCOUNTS INVESTING IN:
- - -----------------------------------
AST - FEDERATED
HIGH YIELD
-------------
JUN. 13* THRU
DEC. 31, 1995
---------------
<S> <C>
0
25,899
190,608
(10)
------
216,497
======
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
CLASS 3 SUB-ACCOUNTS INVESTING IN:
-------------------------------------------------------------------------------------------------------------------------------
AST - FOUNDERS
CAPITAL AST - INVESCO AST - PIMCO TOTAL AST - PIMCO LTD. AST - SCUDDER AST - BERGER
APPRECIATION EQUITY INCOME RETURN BOND MATURITY BOND INTERNATIONAL BOND CAPITAL GROWTH
-------------- --------------- ----------------- ---------------- -------------- -------------
MAY 16* THRU MAY 22* THRU MAY 17* THRU MAY 22* THRU MAY 16* THRU MAY 17* THRU
DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995 DEC. 31, 1995
------------------ ------------------ ----------------- ---------------- ------------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
0 0 0 0 0 0
63,628 122,816 107,323 146,802 17,411 14,070
140,067 33,440 (14,776) 4,114 7,012 6,151
(380) (749) (9) (6) (1) (2)
------ ------ ------ ------- -------- -----
203,315 155,507 92,538 150,910 24,422 20,219
====== ====== ====== ======= ======== =====
</TABLE>
- - --------------------------------------------------------------------------------
19
<PAGE> 23
[EDGAR REFERENCE - IN THE PRINTED VERSION OF THIS REPORT THE AUDITED
DECEMBER 31, 1995 FINANCIAL STATEMENTS OF THE ALGER AMERICAN FUND FOLLOW AT THIS
POINT. THE FINANCIAL STATEMENTS WERE FILED WITH THE COMMISSION VIA THE EDGAR
FORMAT ON FEBRUARY 28, 1996; FORM TYPE N-30D; FILE # 811-5550. THE FINANCIAL
STATEMENTS INCLUDE INFORMATION ON PORTFOLIOS WHICH ARE NOT AVAILABLE TO OWNERS
OF THE LIFEVEST PERSONAL SECURITY ANNUITIES, AMERICAN SKANDIA ADVISORS PLAN
ANNUITIES, AMERICAN SKANDIA ADVISORS PLAN II ANNUITIES NOR THE ALLIANCE CAPITAL
NAVIGATOR ANNUITIES.]
<PAGE> 24
[EDGAR REFERENCE - IN THE PRINTED VERSION OF THIS REPORT THE AUDITED
DECEMBER 31, 1995 FINANCIAL STATEMENTS OF THE NEUBERGER & BERMAN ADVISORS
MANAGEMENT TRUST FOLLOW AT THIS POINT. THE FINANCIAL STATEMENTS WERE FILED WITH
THE COMMISSION VIA THE EDGAR FORMAT ON FEBRUARY 28, 1996; FORM TYPE N-30D; FILE
#811-04255. THE FINANCIAL STATEMENTS INCLUDE INFORMATION ON PORTFOLIOS WHICH ARE
NOT AVAILABLE TO OWNERS OF THE LIFEVEST PERSONAL SECURITY ANNUITIES, AMERICAN
SKANDIA ADVISORS PLAN ANNUITIES, AMERICAN SKANDIA ADVISORS PLAN II ANNUITIES NOR
THE ALLIANCE CAPITAL NAVIGATOR ANNUITIES.]
<PAGE> 25
[EDGAR REFERENCE - IN THE PRINTED VERSION OF THIS REPORT THE AUDITED
DECEMBER 31, 1995 FINANCIAL STATEMENTS OF THE AMERICAN SKANDIA TRUST FUND FOLLOW
AT THIS POINT. THE FINANCIAL STATEMENTS WERE FILED WITH THE COMMISSION VIA THE
EDGAR FORMAT ON MARCH 7, 1996; FORM TYPE N-30D; FILE # 811-05186. THE FINANCIAL
STATEMENTS INCLUDE INFORMATION ON PORTFOLIOS WHICH ARE NOT AVAILABLE TO OWNERS
OF THE LIFEVEST PERSONAL SECURITY ANNUITIES, AMERICAN SKANDIA ADVISORS PLAN
ANNUITIES, AMERICAN SKANDIA ADVISORS PLAN II ANNUITIES NOR THE ALLIANCE CAPITAL
NAVIGATOR ANNUITIES.]
<PAGE> 26
American Skandia Life
Assurance Corporation
Tower One Corporate Drive
Shelton, CT 06484
----------------------
BULK RATE
U. S. POSTAGE
PAID
NEW YORK, NY
PERMIT NO. 8048
----------------------
-----------------------------------------------------------
-----------------------------------------------------------
