-As filed with the Securities and Exchange Commission on April 25, 2008

Registration No. 333-52956; 811-07549

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

PRE-EFFECTIVE AMENDMENT NO. ( )

POST-EFFECTIVE AMENDMENT NO. 19 (X)

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

AMENDMENT NO. 39

(X)

(Check appropriate box or boxes.)

VARIABLE ANNUITY –1 SERIES ACCOUNT

(Exact Name of Registrant)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

(Name of Depositor)

8515 East Orchard Road

Greenwood Village, Colorado 80111

(Address of Depositor’s Principal Executive Offices) (Zip Code)

Depositor’s Telephone Number, including Area Code:

(800) 537-2033

Raymond L. McFeetors

President and Chief Executive Officer

Great-West Life & Annuity Insurance Company

8515 East Orchard Road

Greenwood Village, Colorado 80111

(Name and Address of Agent for Service)

Copy to:

James F. Jorden, Esq.

Jorden Burt, LLP

1025 Thomas Jefferson Street, N.W. Suite 400 East

Washington, D.C. 20007-5208

Approximate Date of Proposed Public Offering: Upon the effective date of this Registration Statement.

It is proposed that this filing will become effective (check appropriate space):

___	Immediately upon filing pursuant to paragraph (b) of Rule 485

_X_ On May 1, 2008, pursuant to paragraph (b) of Rule 485

___ 60 days after filing pursuant to paragraph (a)(1) of Rule 485

___ On (date), pursuant to paragraph (a)(1) of Rule 485.

If appropriate, check the following box:

___ This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

Title of Securities Being Registered: Flexible Premium Deferred Variable Annuity Contracts

SCHWAB ONESOURCE ANNUITY®

A flexible premium variable annuity

Issued by

Great-West Life & Annuity Insurance Company

Overview

This Prospectus describes the Schwab OneSource Annuity, formerly the Schwab Signature Annuity (the “Contract”) — a flexible premium variable annuity contract that allows you to accumulate assets on a tax-deferred basis for retirement or other long-term purposes. Great-West Life & Annuity Insurance Company (“we,” “us,” “Great-West” or “GWL&A”) issues the Contract either on a group basis or as individual contracts. Participants in the group contract will be issued a certificate showing an interest under the group contract. Both will be referred to as “Contract” throughout this Prospectus. The group Contract is offered to: (a) existing customers of Charles Schwab & Co., Inc. (“Schwab”); and (b) individuals that have entered into a contract to receive advisory services from independent investment advisors that have an existing contractual relationship with Schwab.

This Prospectus presents important information you should review before purchasing the Schwab OneSource Annuity. Please read it carefully and keep it for future reference. You can find more detailed information pertaining to the Contract in the Statement of Additional Information (“SAI”) dated May 1, 2008 (as may be amended from time to time), and filed with the Securities and Exchange Commission (the “SEC”). The SAI is incorporated by reference into this Prospectus as a matter of law, which means it is legally a part of this Prospectus. The SAI’s table of contents may be found on the last page of this Prospectus. You may obtain a copy without charge by contacting Schwab Insurance Services at the above address or phone number. Or, you can obtain it by visiting the SEC’s web site at http://www.sec.gov. This web site also contains other information about us that has been filed electronically.

How to Invest

We refer to amounts you invest in the Contract as “Contributions.” The minimum initial Contribution is $5,000. Additional Contributions can be made at any time before you begin receiving annuity payments or taking periodic withdrawals.

The minimum subsequent Contribution is:

•	$500 per Contribution; or

•	$100 per Contribution if made via Automatic Bank Draft Plan.

Allocating Your Money

When you contribute money to the Schwab OneSource Annuity, you can allocate it among the Sub-Accounts of the Variable Annuity-1 Series Account which invest in the following Portfolios:

•	AIM V.I. International Growth Fund – Series I Shares

•	Alger American Growth Portfolio – Class O Shares

•	Alger American MidCap Growth Portfolio – Class O Shares

•	AllianceBernstein VPS Growth & Income Portfolio – Class A Shares

•	AllianceBernstein VPS Growth Portfolio – Class A Shares

•	AllianceBernstein VPS International Growth Portfolio – Class A Shares

•	AllianceBernstein VPS International Value Portfolio – Class A Shares

•	AllianceBernstein VPS Real Estate Investment Portfolio – Class A Shares

•	AllianceBernstein VPS Small/Mid Cap Value Portfolio – Class A Shares

•	American Century VP Balanced Fund – Original Class Shares

•	American Century VP Income & Growth Fund – Original Class Shares

•	American Century VP Value Fund – Original Class Shares

The Securities and Exchange Commission has not approved or disapproved these securities or passed upon the adequacy of this Prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is May 1, 2008.

•	Delaware VIP Growth Opportunities Series – Standard Class

•	Delaware VIP Small Cap Value Series – Standard Class

•	Dreyfus Investment Portfolios MidCap Stock Portfolio – Initial Shares

•	Dreyfus Variable Investment Fund Appreciation Portfolio – Initial Shares

•	DWS Blue Chip VIP – Class A Shares

•	DWS Capital Growth VIP – Class A Shares

•	DWS Dreman High Return Equity VIP – Class A Shares

•	DWS Dreman Small Mid Cap Value VIP – Class A Shares (formerly DWS Dreman Small Cap Value VIP)

•	DWS Health Care VIP – Class A Shares

•	DWS Large Cap Value VIP – Class A Shares

•	DWS Small Cap Index VIP – Class A Shares

•	Federated Fund for U.S. Government Securities II

•	Franklin Small Cap Value Securities Fund – Class II

•	Janus Aspen Series Balanced Portfolio – Service Shares1

•	Janus Aspen Series Flexible Bond Portfolio – Service Shares¹

•	Janus Aspen Series Growth and Income Portfolio – Service Shares¹

•	LVIP Baron Growth Opportunities Fund – Service Shares (formerly Baron Capital Asset Fund)²

•	MFS VIT Utility Series – Service Class*

•	Neuberger Berman AMT Regency Portfolio – Class S Shares

•	NVIT Mid Cap Index Portfolio – Class II Shares (formerly GVIT Mid Cap Index Fund)

•	Oppenheimer Global Securities Fund/VA

•	Oppenheimer International Growth Fund/VA

•	PIMCO VIT High Yield Portfolio – Administrative Class Shares

•	PIMCO VIT Low Duration Portfolio – Administrative Class Shares

•	PIMCO VIT Total Return Portfolio – Administrative Class Shares

•	Pioneer Emerging Markets VCT – Class 2 Shares*

•	Pioneer Fund VCT Portfolio – Class I Shares

•	Pioneer Growth Opportunities VCT Portfolio – Class I Shares

•	Pioneer Mid Cap Value VCT Portfolio – Class II Shares

•	Pioneer Small Cap Value Fund VCT Portfolio – Class I Shares

•	Schwab MarketTrack Growth Portfolio II™

•	Schwab Money Market Portfolio™

•	Schwab S&P 500 Index Portfolio

•	Seligman Communication & Information – Class 2 Shares

_________________________

¹ As of May 1, 2007, Owners may only invest in the Service Class Sub-Accounts of Janus Portfolios. The Institutional Class Sub-Accounts were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers) effective May 1, 2007. The Service Class has a Rule 12b-1 Plan (and higher expenses) and the Institutional Class does not.

² As of June 5, 2007, the assets of the Baron Capital Asset Fund were transferred to the LVIP Baron Growth Opportunities Fund. LVIP Baron Growth Opportunities Fund shares were distributed to the Baron Capital Asset Fund shareholders and all outstanding Baron Capital Asset Fund shares were cancelled and the Baron Capital Asset Fund was liquidated.

This Prospectus does not constitute an offering in any jurisdiction in which such offering may not be lawfully made. No dealer, salesperson or other person is authorized to give any information or make any representations in connection with the Contracts other than those contained in this Prospectus, and, if given or made, such other information or representations must not be relied on.

This Contract is not available in all states.

•	Third Avenue Value Portfolio – Variable Series Trust Shares

•	Van Kampen LIT Comstock – Class I Shares

•	Van Kampen LIT Growth & Income – Class I Shares

•	Wells Fargo Advantage VT Discovery Fund – Class VT Shares

•	Wells Fargo Advantage VT Opportunity Fund – Class VT Shares

*New Portfolios available as of May 1, 2008.

Effective May 1, 2008, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers):

•	AllianceBernstein VPS Utility Income Portfolio – Class A Shares

Effective May 1, 2007, the Sub-Account investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers):

•	Janus Aspen Series Balanced Portfolio – Institutional Shares

•	Janus Aspen Series Flexible Bond Portfolio – Institutional Shares

•	Janus Aspen Series Growth and Income Portfolio –Institutional Shares

Effective May 1, 2006, the Sub-Account investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers):

•	AIM V.I. Technology Fund – Series I Shares

•	Alger American Balanced Portfolio – Class O Shares

•	American Century VP International Fund – Original Class Shares

•	Dreyfus Variable Investment Fund Growth and Income Portfolio – Initial Shares

•	Federated International Equity Fund II

•	DWS Small Cap Growth VIP – Class A Shares

•	JPMorgan Small Company Portfolio

•	Old Mutual Large Cap Growth Portfolio

Effective April 29, 2005, the Sub-Account investing in these Portfolios were closed to new Contributions and incoming Transfers (including Automatic Custom Transfers):

•	AIM V.I. High Yield Fund – Series I Shares

•	Dreyfus Variable Investment Fund Developing Leaders Portfolio – Initial Shares

•	Janus Aspen Series Worldwide Growth Portfolio – Institutional Shares

This Contract is not available in all states.

Sales and Surrender Charges

There are no sales, redemption, surrender, or withdrawal charges under the Schwab OneSourceAnnuity.

Right of Cancellation Period

After you receive your Contract, you can look it over for at least 10 days or longer if required by your state law (in some states, up to 35 days for replacement policies), during which time you may cancel your Contract as described in more detail on this prospectus.

Payout Options

The Schwab OneSource Annuity offers three payout options - through periodic withdrawals, variable annuity payouts or a single, lump-sum payment. The Contracts are not deposits of, or guaranteed or endorsed by, any bank, nor are the Contracts federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency. The Contracts involve certain investment risks, including possible loss of principal.

For account information, please contact:

Schwab Insurance Services

P.O. Box 7666

San Francisco, California 94120-9639

Via Internet:

www.schwab.com

Table of Contents

Definitions		6
Fee Table		8
Example		9
Condensed Financial Information		10
Summary		10
	How to Contact Schwab	10
Great-West Life & Annuity Insurance Company		11
The Series Account		11
The Portfolios		12
	Meeting Investment Objectives	12
	Where to Find More Information About the Portfolios	21
	Addition, Deletion or Substitution	21
Application and Initial Contributions		21
Right of Cancellation Period		22
Subsequent Contributions		22
Annuity Account Value		23
Transfers		23
	Market Timing & Excessive Trading	24
	Automatic Customer Transfers	25
Cash Withdrawals		27
	Withdrawals to Pay Investment Manager or Financial Advisor Fees	27
	Tax Consequences of Withdrawals	27
Telephone and Internet Transactions		28
Death Benefit		28
	Beneficiary	29
	Distribution of Death Benefit	30
Charges and Deductions		31
Mortality and Expense Risk Charge		31
	Expenses of the Portfolios	31
	Premium Tax	32
	Other Taxes	32
Payout Options		32
	Periodic Withdrawals	32
	Annuity Payouts	33
Seek Tax Advice		34
Federal Tax Matters		34
	Taxation of Annuities	35
Assignments or Pledges		37
Distribution of the Contracts		37
Voting Rights		37
Rights Reserved by Great-West		38
Legal Proceedings		38
Legal Matters		38
Independent Registered Public		38
Accounting Firm		38
Available Information		39
Appendix A – Condensed Financial Information		A-1
Appendix B – Net Investment Factor		B-1

Definitions

1035 Exchange—A provision of the Internal Revenue Code of 1986, as amended (the “Code”), that allows for the tax-free exchange of certain types of insurance contracts.

Accumulation Period—The time period between the Effective Date and the Annuity Commencement Date. During this period, you are contributing to the annuity.

Annuitant—The person named in the application upon whose life the payout of an annuity is based and who will receive annuity payouts. If a Contingent Annuitant is named, the Annuitant will be considered the “Primary Annuitant.”

Annuity Account—An account established by us in your name that reflects all account activity under your Contract.

Annuity Account Value—The sum of the value of each Sub-Account you have selected.

Annuity Commencement Date—The date annuity payouts begin.

Annuity Payout Period—The period beginning on the Annuity Commencement Date and continuing until all annuity payouts have been made under the Contract. During this period, the Annuitant receives payouts from the annuity.

Annuity Unit—An accounting measure we use to determine the amount of any variable annuity payout after the first annuity payout is made.

Automatic Bank Draft Plan—A feature that allows you to make automatic periodic Contributions. Contributions will be withdrawn from an account you specify and automatically credited to your Annuity Account.

Beneficiary—The person(s) designated to receive any Death Benefit under the terms of the Contract.

Contingent Annuitant—The person you may name in the application who becomes the Annuitant when the Primary Annuitant dies. The Contingent Annuitant must be designated before the death of the Primary Annuitant.

Contingent Beneficiary—The person designated to become the Beneficiary when the primary Beneficiary dies.

Contributions—The amount of money you invest or deposit into your annuity.

Death Benefit—The amount payable to the Beneficiary when the Owner or the Annuitant dies.

Distribution Period—The period starting with your Payout Commencement Date.

Schwab OneSource Annuity Structure

Your Annuity Account

Series Account

Contains the money you contribute

to variable investment options

(the Sub-Accounts).

Sub-Accounts

Shares of the Portfolios are held

in Sub-Accounts. There is one

Sub-Account for each Portfolio.

Portfolios

___________________________________________________________________________

Effective Date—The date on which the first Contribution is credited to your Annuity Account.

Owner (Joint Owner) or You—The person(s) named in the application who is entitled to exercise all rights and privileges under the Contract, while the Annuitant is living. Joint Owners must be husband and wife as of the date the Contract is issued. The Annuitant will be the Owner unless otherwise indicated in the application.

Payout Commencement Date—The date on which annuity payouts or periodic withdrawals begin under a payout option. If you do not indicate a Payout Commencement Date on your application or at any time thereafter, annuity payouts will begin on the Annuitant's 91st birthday.

Portfolio—A registered management investment company, or Portfolio thereof, in which the assets of the Series Account may be invested.

Premium Tax—A tax charged by a state or other governmental authority. Varying by state, the current range of Premium Taxes is 0% to 3.5% and may be deducted with respect to your Contributions, from amounts withdrawn, or from amounts applied on the Payout Commencement Date, or the Annuity Account Value when incurred by Great-West or at another time of Great-West’s choosing.

Proportional Withdrawals—A partial withdrawal made by you which reduces your Annuity Account Value measured as a percentage of each prior withdrawal against the current Annuity Account Value. A Proportional Withdrawal is determined by calculating the percentage the withdrawal represents of your Annuity Account Value at the time the withdrawal was made.

Proportional Withdrawals, continued—For example, a partial withdrawal of 75% of the Annuity Account Value represents a Proportional Withdrawal of 75% of the total Contributions for purposes of calculating the Death Benefit under option 2 for Contracts issued after April 30, 2004.

Request—Any written, telephoned, electronic or computerized instruction in a form satisfactory to Great-West and Schwab received at Schwab Insurance Services (or other annuity service center subsequently named) from you, your designee (as specified in a form acceptable to Great-West and Schwab) or the Beneficiary (as applicable) as required by any provision of the Contract. The Request is subject to any action taken or payment made by Great-West before it was processed.

Schwab Insurance Services—P.O. Box 7666, San Francisco, CA 94120-9639. The toll-free telephone number is 1-800-838-0650.

Series Account—Variable Annuity-1 Series Account, the segregated asset account established by Great-West under Colorado law and registered as a unit investment trust under the Investment Company Act of 1940, as amended (the “1940 Act”). The Series Account is also referred to as the separate account.

Sub-Account—A division of the Series Account containing the shares of a Portfolio. There is a Sub-Account for each Portfolio. Sub-Account may be also referred to as “investment division” in the Prospectus, SAI, or Series Account financial statements.

Surrender Value —Your Annuity Account Value on the Transaction Date of the surrender, less Premium Tax, if any.

Transaction Date—The date on which any Contribution or Request from you will be processed. Contributions and Requests received after the close of regular trading on the New York Stock Exchange (generally 4:00 p.m. EST/EDT) will be deemed to have been received on the next business day. Requests will be processed and the Annuity Account Value will be determined on each day that the New York Stock Exchange is open for trading.

Transfer—Moving money from and among the Sub-Account(s).

Fee Table

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the Contract. The first table describes the fees and expenses that you will pay at the time that you buy the Contract, surrender the Contract, or transfer cash value between investment options. State premium taxes may also be deducted.

Contract Owner Transaction Expenses

Sales Load Imposed on Purchases

(as percentage of purchase payments):

None

Maximum Surrender Charge

(as a percentage of purchase payments):

None

Maximum Transfer Charge:

$25*

* Applicable to each Transfer after the first twelve Transfers each calendar year. Currently, there is no charge for Transfers. We reserve the right, however, to impose a transfer fee after we notify you. See "Transfers."

The next table describes the fees and expenses that you will pay periodically during the time that you own the Contract, not including Portfolio fees and expenses.

Annual Contract Maintenance Charge

None

Series Account Annual Expenses (as a percentage of average net assets)

Maximum Mortality and Expense Risk Charge:

0.85%*

Distribution Charge:

None

Total Series Account Annual Expenses:

0.85%*

* If you select Death Benefit option 1, your Mortality and Expense Risk Charge and Total Series Account Annual Expenses will be 0.65%. If you select Death Benefit Option 2, this charge will be 0.85%, but for Contracts issued before May 1, 2003, if you selected Death Benefit option 2, your Mortality and Expense Risk Charge and Total Series Account Annual Expenses will continue to be 0.70%.

The next item shows the minimum and maximum total operating expenses charged by the Portfolios that you may pay periodically during the time that you own the Contract. More detail concerning each Portfolio’s fees and expenses is contained in the prospectus for each Portfolio.

Total Annual Portfolio Operating Expenses

Minimum

Maximum

(Expenses that are deducted from Portfolio assets,

including management fees, distribution [and/or

service] (12b-1) fees, and other expenses)

0.25%^.

1.84%¹

THE ABOVE EXPENSES FOR THE ELIGIBLE FUNDS WERE PROVIDED BY THE PORTFOLIOS. WE HAVE NOT INDEPENDENTLY VERIFIED THE ACCURACY OF THE INFORMATION.

_________________________

¹ The expenses shown are based, in part, on estimated amounts for the current fiscal year, and do not reflect any fee waiver or expense reimbursement. The advisers and/or other service providers of certain Portfolios have agreed to reduce their fees and/or reimburse the Portfolios' expenses in order to keep the Portfolios' expenses below specified limits. The expenses of certain Portfolios are reduced by contractual fee reduction and expense reimbursement arrangements. Other Portfolios have voluntary fee reduction and/or expense reimbursement arrangements that may be terminated at any time. Each fee reduction and/or expense reimbursement arrangement is not reflected above, but is described in the relevant Portfolio's prospectus.

Example

This Example is intended to help you compare the cost of investing in the Contract with the cost of investing in other variable annuity contracts. These costs include Owner transaction expenses, contract fees, Series Account annual expenses, and Portfolio fees and expenses.

The Example assumes that you invest $10,000 in the Contract for the time periods indicated. The Example also assumes that your investment has a 5% return each year and assumes the maximum fees and expenses of any of the Portfolios. In addition, this Example assumes no transfers were made and no premium taxes were deducted. If these arrangements were considered, the expenses shown would be higher. This Example also does not take into consideration any fee waiver or expense reimbursement arrangements of the Portfolio. If these arrangements were taken into consideration, the expenses shown would be lower.

Although your actual costs may be higher or lower, based on these assumptions, your costs would be:

If you surrender your Contract, annuitize your Contract OR if you do not surrender your Contract at the end of the applicable time period:

1 year

3 years

5 years

10 years

$279

$897

$1,606

$3,842

This Example does not show the effect of premium taxes. Premium taxes (ranging from 0% to 3.5%) are deducted from Contract Value upon full surrender, death, or annuitization. This Example also does not include any of the taxes or penalties you may be required to pay if you surrender your Contract.

The fee table and example should not be considered a representation of past or future expenses and charges of the Sub-accounts. Your actual expenses may be greater or less than those shown. Similarly, the 5% annual rate of return assumed in the example is not an estimate or a guarantee of future investment performance. See "Charges and Deductions" in this Prospectus. Owners who purchase the Contract may be eligible to apply the contract value to the total amount of their household assets maintained at Schwab. If the total amount of their household assets at Schwab meets certain predetermined breakpoints, they may be eligible for certain fee reductions or other related benefits offered by Schwab. All terms and conditions regarding the fees and account types eligible for such consideration are determined by Schwab. Charges and expenses of the variable annuity contract described in this Prospectus are NOT subject to reduction or waiver by Schwab. Please consult a Charles Schwab representative for more information.

Condensed Financial Information

Attached as Appendix A is a table showing selected information concerning accumulation units for each Sub-Account. An accumulation unit is the unit of measure that we use to calculate the value of your interest in a Sub-Account. The accumulation unit values reflect the deduction of the only charge we impose under the Contract, the Mortality and Expense Risk Charge. The information in the table is derived from various financial statements of the Series Account, which have been audited by Deloitte & Touche LLP, an independent registered public accounting firm. To obtain a more complete picture of each Sub-Account’s finances and performance, you should also review the Series Account’s financial statements, which are in the Statement of Additional Information.

Summary

The Schwab OneSource Annuity allows you to accumulate assets on a tax-deferred basis by investing in a variety of variable investment options (the Sub-Accounts). The performance of your Annuity Account Value will vary with the investment performance of the Portfolios corresponding to the Sub-Accounts you select. You bear the entire investment risk for all amounts invested in them. Depending on the performance of the Sub-Accounts you select, your Annuity Account Value could be less than the total amount of your Contributions.

You may purchase the Schwab OneSourceAnnuity through a 1035 Exchange from another insurance contract. However, in no event, may you purchase the Contract as a part of a tax-qualified plan or a rollover of amounts from such a plan, including an IRA.

How to contact Schwab Insurance Services:

Schwab Insurance Services

P.O. Box 7666

San Francisco, CO 94120-9639

800-838-0650

Your initial Contribution must be at least $5,000. Subsequent Contributions must be either $500; or $100 if made through an Automatic Bank Draft Plan.

The money you contribute to the Contract will be invested at your direction, except that in some states during your “Right of Cancellation period” your payment will be allocated to the Schwab Money Market Sub-Account. The duration of your Right of Cancellation period depends on your state law and is generally 10 days after you receive your Contract. Allocations during the Right of Cancellation period are described in more detail in this Prospectus.

Prior to the Payout Commencement Date, you can withdraw all or a part of your Annuity Account Value. There are no surrender or withdrawal charges. Certain withdrawals will normally be subject to federal income tax and may also be subject to a federal penalty tax. You may also pay a Premium Tax upon a withdrawal.

When you’re ready to start taking money out of your Contract, you can select from a variety of payout options, including a lump sum payment or variable annuity payouts as well as periodic payouts.

If the Annuitant dies before the Annuity Commencement Date, we will pay the Death Benefit to the Beneficiary you select. If the Owner dies before the entire value of the Contract is distributed, the remaining value will be distributed according to the rules outlined in the “Death Benefit” section on page 28.

The amount distributed to your Beneficiary will depend on the Death Benefit option you select. We offer two Death Benefit options. For Option 1, the Owner, Annuitant, and Contingent Annuitant each must be age 85 or younger at the time the Contract is issued. Option 1 provides for the payment of your Annuity Account Value minus any Premium Tax. For Option 2, the Owner, Annuitant, and Contingent Annuitant each must be age 80 or younger at the time the Contract is issued. For Contracts issued prior to April 30, 2004, Option 2 provides for the payment of the greater of (1) your Annuity Account Value, minus any Premium Tax or (2) the sum of Contributions applied to the Contract as of the date the request for payment is received, less partial withdrawals, periodic withdrawals, and premium tax, if any. For Contracts issued on or after April 30, 2004, Option 2 provides for the payment of the greater of (1) your Annuity Account Value, minus any Premium Tax or (2) the sum of all Contributions, minus any Proportional Withdrawals you have made and minus any Premium Tax. If you select Death Benefit option 1, your Mortality and Expense Risk Charge will be 0.65%. If you choose Death Benefit option 2, this charge will be 0.85%. For Contracts issued prior to May 1, 2003, if you selected Death Benefit option 2, this charge will remain at 0.70%. In addition, each Portfolio assesses a charge for management fees and other expenses.

You may cancel your Contract during the Right of Cancellation period by sending it to Schwab Insurance Services or to the representative from whom you purchased it. If you are replacing an existing insurance contract with the Contract, the Right of Cancellation period may be extended based on your state of residence. The Right of Cancellation period is described in more detail in this Prospectus.

This summary highlights some of the more significant aspects of the Schwab OneSourceAnnuity. You’ll find more detailed information about these topics throughout the Prospectus and in your Contract. Please keep them both for future reference

Great-West Life & Annuity Insurance Company

Great-West is a stock life insurance company that was originally organized under the laws of the state of Kansas as the National Interment Association. Our name was changed to Ranger National Life Insurance Company in 1963 and to Insuramerica Corporation prior to changing to our current name in 1982. In September of 1990, we re-domesticated under the laws of the State of Colorado. Our executive office is located at 8515 East Orchard Road, Greenwood Village, Colorado 80111.

Great-West is a wholly owned subsidiary of GWL&A Financial, Inc., a Delaware holding company. GWL&A Financial, Inc. is an indirect wholly-owned subsidiary of Great-West Lifeco Inc., a Canadian holding company. Great-West Lifeco Inc. is a subsidiary of Power Financial Corporation, a Canadian holding company with substantial interests in the financial services industry. Power Financial Corporation is a subsidiary of Power Corporation of Canada, a Canadian holding and management company. Mr. Paul Desmarais, through a group of private holding companies that he controls, has voting control of Power Corporation of Canada.

We are authorized to do business in 49 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, and Guam.

The Series Account

We established the Series Account in accordance with Colorado laws on July 24, 1995.

The Series Account is registered with the SEC under the 1940 Act, as amended, as a unit investment trust. Registration under the 1940 Act does not involve supervision by the SEC of the management or investment practices or policies of the Series Account.

We own the assets of the Series Account. The income, gains or losses, realized or unrealized, from assets allocated to the Series Account are credited to or charged against the Series Account without regard to our other income, gains or losses.

We will at all times maintain assets in the Series Account with a total market value at least equal to the reserves and other liabilities relating to the variable benefits under all Contracts and other of our variable insurance products participating in the Series Account. Those assets may not be charged with our liabilities from our other businesses. Our obligations under the Contracts and other products are, however, our general corporate obligations.

In calculating our corporate income tax liability, we derive certain corporate income tax benefits associated with the investment of company assets, including Series Account assets that are treated as company assets under applicable income tax law. These benefits, which reduce our overall corporate income tax liability, may include dividends received deductions and foreign tax credits which can be material. We do not pass these benefits through to the Series Account or our other separate accounts, principally because: (i) the great bulk of the benefits results from the dividends received deduction, which involves no reduction in the dollar amount of dividends that the Series Account receives; and (ii) under applicable income tax law, Owners are not the owners of the assets generating the benefits.

The Series Account is divided into 66 Sub-Accounts, 51 of which are currently available and 15 of which no longer accept new Contributions or incoming Transfers (including Automatic Custom Transfers). Each Sub-Account invests exclusively in shares of a corresponding investment Portfolio of a registered investment company (commonly known as a mutual fund). We may in the future add new or delete existing Sub-Accounts. The income, gains or losses, realized or unrealized, from assets allocated to each Sub-Account are credited to or charged against that Sub-Account without regard to the other income, gains or losses of the other Sub-Accounts. All amounts allocated to a Sub-Account will be fully invested in Portfolio shares.

We hold the assets of the Series Account. We keep those assets physically segregated and held separate and apart from our general account assets. We maintain records of all purchases and redemptions of shares of the Portfolios.

The Portfolios

The Contract offers a number of Portfolios, corresponding to the Sub-Accounts. Each Sub-Account invests in a single Portfolio. Each Portfolio is a separate mutual fund registered under the 1940 Act. More comprehensive information, including

a discussion of potential risks, is found in the current prospectuses for the Portfolios (the “Portfolio Prospectuses”). The Portfolio Prospectuses should be read in connection with this Prospectus. You may obtain a copy of the Portfolio Prospectuses without charge by Request.

Each Portfolio:

•	holds its assets separately from the assets of the other Portfolios,

•	has its own distinct investment objectives and policies, and

•	operates as a separate investment fund.

The income, gains and losses of one Portfolio generally have no effect on the investment performance of any other Portfolio.

The Portfolios are not available to the general public directly. The Portfolios are only available as investment options in variable annuity contracts or variable life insurance policies issued by life insurance companies or, in some cases, through participation in certain qualified pension or retirement plans.

Some of the Portfolios have been established by investment advisers, which manage publicly available mutual funds having similar names and investment objectives. While some of the Portfolios may be similar to, and may in fact be modeled after publicly available mutual funds, you should understand that the Portfolios are not otherwise directly related to any publicly available mutual fund. Consequently, the investment performance of publicly available mutual funds and any corresponding Portfolios may differ. The investment objectives of the Portfolios are briefly described below:

AIM Variable Insurance Funds Trust— advised by Invesco Aim Advisors, Inc., Houston, Texas, and sub-advised by advisory entities affiliated with Invesco Aim Advisors, Inc.

AIM V.I. High Yield Fund–Series I Shares seeks a high level of current income. The Portfolio seeks to meet its objective by investing, normally, at least 80% of its net assets, in debt securities that are determined to be below investment grade quality because they are rated BB/Ba or lower by Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc., or any other nationally recognized statistical rating organization (NRSRO), or are determined by the portfolio managers to be of comparable quality to such rated securities. These types of securities are commonly known as ‘‘junk bonds.’’ The fund will principally invest in junk bonds rated B or above by an NRSRO or deemed to be of comparable quality by the portfolio managers. The Portfolio may invest up to 25% of its total assets in foreign securities. The Portfolio may also invest in securities, whether or not considered foreign securities, which carry foreign credit exposure. The Portfolio may invest up to 15% of its total assets in securities of companies located in developing countries. The fund’s investments in the types of securities described in this prospectus varies from time to time, and at any time, the fund may not be invested in all types of securities described in this prospectus. Any percentage limitations with respect to assets of the Portfolio are applied at the time of purchase.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

AIM V.I. International Growth Fund–Series I Shares seeks to provide long-term growth of capital. The Portfolio seeks to meet its objective by investing in a diversified portfolio of international equity securities. The Portfolio focuses its investments in marketable equity securities of foreign companies that are listed on a recognized foreign or U.S. securities exchange or traded in a foreign or U.S. over-the-counter market. The Portfolio will normally invest in the securities of companies in the developed countries of Western Europe and the Pacific Basin. The Portfolio may invest no more than 20% of its total assets in companies located in developing countries, i.e., those that are in the initial stages of their industrial cycles.

AIM V.I. Technology Fund–Series I Shares investment objective is capital growth. The Portfolio seek to meet its objective by investing ,normally, at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in equity securities of issuers engaged primarily in technology-related industries. The Portfolio considers a company to be doing business in technology-related industries if it meets at least one of the following tests: (1) at least 50% of its gross income or its net sales come from activities in technology-related industries; (2) at least 50% of its assets are devoted to producing revenues in technology-related industries; or (3) based on other available information, the portfolio manager determines that its primary business is within technology-related industries. The principal type of equity securities purchased by the Portfolio is common stocks. Companies in technology-related industries include, but are not limited to, those involved in the design, manufacture, distribution, licensing, or provision of various applied technologies, hardware, software, semiconductors, telecommunications equipment, as well as services and service-related companies in information technology.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

The Alger American Fund—advised by Fred Alger Management, Inc. of New York, New York.

Alger American Balanced Portfolio-Class O Shares seeks current income and long term capital appreciation. The Portfolio focuses on stocks of companies that the manager believes demonstrate growth potential and on fixed-income securities, with emphasis on income-producing securities that appear to have potential for capital appreciation. Under normal circumstances, the Portfolio invests in equity securities and in fixed-income securities, which may include corporate bonds, debentures and notes, U.S. government securities, mortgage-backed and asset-backed securities, commercial paper and other fixed-income securities. Most of the Portfolio’s fixed-income investments will be concentrated within the four highest rating categories as determined by one of the nationally recognized statistical rating organizations (“NRSROs”) (or, if unrated, will have been determined to be of comparable quality by the manager). The Portfolio also may invest up to 10% of its net assets in lower-rated securities rated “B” (or the equivalent) or better by any one of those rating agencies (or, if unrated, determined to be of comparable quality by the manager). Under normal circumstances, the Portfolio will invest at least 25% of its net assets in fixed-income securities and at lest 25% of its net assets in equity securities.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Alger American LargeCap Growth Portfolio-Class O Shares seeks long-term capital appreciation. It focuses on growing companies that generally have broad product lines, markets, financial resources, and depth of management. Under normal circumstances, the Portfolio invests primarily in the equity securities of companies that have a market capitalization of $1 billion or greater.

Alger American MidCap Growth Portfolio-Class O Shares seeks long-term capital appreciation. It focuses on midsized companies that the manager believes demonstrate promising growth potential. Under normal circumstances, the Portfolio invests at least 80% of its net assets in equity securities of companies that, at the time of purchase of the securities, have total market capitalization within the range of companies included in the Russell MidCap Growth Index or the S&P MidCap 400 Index, as reported by the indexes as of the most recent quarter-end. Both indexes are designed to track the performance of medium-capitalization stocks.

AllianceBernstein Variable Products Series Fund, Inc.—advised by AllianceBernstein, L.P., New York, New York.

AllianceBernstein VPS Growth & Income Portfolio-Class A Shares seeks to provide long-term growth of capital. The Portfolio invests primarily in the equity securities of U.S. companies that AllianceBernstein believes are undervalued. AllianceBernstein believes that, over time, a company’s stock price will come to reflect its intrinsic economic value. AllianceBernstein uses a disciplined investment process to evaluate the companies in its extensive research universe and to identify the stocks of companies that offer the best combination of value and potential for price appreciation. The Portfolio may invest in companies of any size and in any industry. The Portfolio also invests in the high-quality securities of non-U.S. issuers.

AllianceBernstein VPS Growth Portfolio-Class A Shares seeks to provide long-term growth of capital. The Portfolio invests primarily in equity securities of companies with favorable earnings outlooks and whose long-term growth rates are expected to exceed market expectations over time. The Portfolio emphasizes investments in large- and mid-cap companies. The Portfolio has the flexibility to invest across the capitalization spectrum reflecting the Advisor’s internal research.

AllianceBernstein VPS International Growth Portfolio–Class A Shares seeks long-term growth of capital. The Portfolio invests primarily in an international portfolio of equity securities of companies located in both developed and emerging countries. The Portfolio consists of approximately 100-130 stocks. The Portfolio invests, under normal circumstances, in the equity securities of companies based in at least three countries (and normally substantially more) other than the United States. The Portfolio’s investments include investments in securities of companies that are established as a result of privatizations of state enterprises.

AllianceBernstein VPS International Value Portfolio-Class A Shares seeks long-term growth of capital. The Portfolio will invest primarily in a diversified portfolio of equity securities of established companies selected from more than 40 industries and more than 40 developed and emerging-market countries. The Portfolio normally invests in companies in at least three countries other than the United States. These countries currently include the developed nations in Europe and the Far East, Canada, Australia and emerging-market countries worldwide. The Portfolio invests in companies that are determined by the Advisor’s Bernstein unit to be undervalued, using a fundamental value approach. In selecting securities for the portfolio,

Bernstein uses its fundamental and quantitative research to identify companies whose long-term earnings power is not reflected in the current market price of their securities.

AllianceBernstein VPS Real Estate Investment Portfolio-Class A Shares seeks total return from long-term growth of capital and income. The Portfolio invests, under normal circumstances, at least 80% of its net assets in equity securities of real estate investment trusts or ‘‘REITs’’ and other real estate industry companies. The Portfolio invests in real estate companies that Alliance believes have strong property fundamentals and management teams. The Portfolio seeks to invest in real estate companies whose underlying portfolios are diversified geographically and by property type.

AllianceBernstein VPS Small/Mid Cap Value Portfolio-Class A Shares seeks long-term growth of capital. The Portfolio invests primarily in a diversified portfolio of equity securities of small-to mid-cap U.S. companies, generally representing 60-110 companies. Under normal circumstances, the Portfolio will invest at least 80% of its net assets in these types of securities. The Portfolio invests in companies that are determined by AllianceBernstein to be undervalued, using its Bernstein unit’s fundamental value approach. In selecting securities for the portfolio, Bernstein uses its fundamental research to identify companies whose long-term earnings power is not reflected in the current market prices of their securities.

AllianceBernstein VPS Utility Income Portfolio-Class A Shares seeks current income and long-term growth of capital. Under normal circumstances, the Portfolio invests at least 80% of its net assets in securities of companies in the utilities industry. The Portfolio invests in securities of utility companies in the electric, telecommunications, gas, and water utility industries. The Portfolio may invest in both U.S. and non-U.S. utility companies, although the Portfolio will limit its investments in issuers in any one non-U.S. country to no more than 15% of its total assets. The Portfolio invests at least 65% of its net assets in income-producing securities, but there is otherwise no limit on the allocation of the Portfolio’s investments between equity securities and fixed-income securities. The portfolio may maintain up to 35% of its net assets in lower-rated securities.

Effective May 1, 2008, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

American Century Variable Portfolios, Inc.—advised by American Century( Investment Management, Inc. of Kansas City, Missouri, advisers to the American Century family of mutual funds.

American Century VP Balanced Fund-Original Class Shares seeks long-term capital growth and current income by investing approximately 60% of its assets in equity securities and the remainder in bonds and other fixed-income securities.

American Century VP Income & Growth Fund-Original Class Shares seeks capital growth by investing in common stocks. Income is a secondary objective. In selecting stocks for the Portfolio, the managers select primarily from the largest 1,500 publicly traded U.S. companies.

American Century VP International Fund-Original Class Sharesseeks capital growth by investing primarily in equity securities of foreign companies. The Portfolio invests primarily in securities of issuers in developed countries. International investing involves special risks including currency fluctuation and political instability. American Century Global Investment Management, Inc. is the adviser for the Portfolio.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

American Century VP Value Fund-Original Class Shares seeks long-term capital growth. Income is a secondary objective. The managers look for companies whose stock price is less than they believe the company is worth. The managers attempt to purchase stock of these undervalued companies and hold them until their stock price has increased to, or is higher than, a level the managers believe more accurately reflects the fair value of the company.

Delaware VIP Trust—The Series is managed by Delaware Management Company, a series of Delaware Management Business Trust, which is an indirect wholly owned subsidiary of Delaware Management Holdings, Inc.

Delaware VIP Growth Opportunities Series–Standard Class seeks long-term capital appreciation by investing primarily in common stocks of medium-sized companies. The Portfolio’s investment advisors consider medium-sized companies to be those companies whose market capitalizations fall within the range represented in the Russell Midcap Growth Index at the time of the Portfolio’s investment. The Portfolio may also invest in securities that are convertible into common stocks. In selecting stocks for the Portfolio, the investment advisors typically look for companies that have established themselves within their industry, but still have growth potential.

Delaware VIP Small Cap Value Series–Standard Class seeks capital appreciation by investing under normal circumstances, at least 80% of the Portfolio’s net assets will be in investments of small-capitalization companies. For the purposes of this Portfolio, small-capitalization companies are companies with a market capitalization generally less than 3.5 times the dollar-weighted, median market capitalization of the Russell 2000 Index at the time of purchase. Among other factors, the financial strength of a company, its management, the prospects for its industry, and any anticipated changes within the company, which might suggest a more favorable outlook going forward, are investment considerations for the Portfolio.

Dreyfus Investment Portfolios—advised by The Dreyfus Corporation of New York, New York.

Dreyfus Investment Portfolios MidCap Stock Portfolio-Initial Shares seeks investment results that are greater than the total return performance of publicly traded common stocks of medium-size domestic companies in the aggregate, as represented by the Standard & Poor's MidCap 400^® Index. To pursue this goal, the Portfolio normally invests at least 80% of its assets in stocks of mid-size companies. The Portfolio invests in growth and value stocks, which are chosen through a disciplined investment process that combines computer modeling techniques, fundamental analysis, and risk management.

Dreyfus Variable Investment Fund—advised by The Dreyfus Corporation of New York, New York.

Dreyfus Variable Investment Fund Appreciation Portfolio-Initial Shares seeks long-term capital growth consistent with the preservation of capital; current income is its secondary goal. To pursue these goals, the Portfolio invests at least 80% of its assets in common stocks. The Portfolio focuses on “blue-chip” companies with total market values of more than $5 billion at the time of purchase, including multinational companies. Fayez Sarofim & Co. is the sub-advisor to this Portfolio and, as such, provides day-to-day management.

Dreyfus Variable Investment Fund Growth and Income Portfolio-Initial Shares seeks long-term capital growth, current income and growth of income consistent with reasonable investment risk. To pursue this goal, the Portfolio seeks to invest in stocks of domestic and foreign issuers.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Dreyfus Variable Investment Fund Developing Leaders Portfolio-Initial Shares seeks capital growth. To pursue this goal, the Portfolio normally invests at least 80% of its assets in the stocks of companies Dreyfus believes to be developing leaders: those characterized by new or innovative products, services, or processes having the potential to enhance earnings or revenue growth. Based on current market conditions, the Portfolio primarily invests small companies with total market capitalizations of less than $2 billion at the time of purchase.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

DWS Capital Growth VIP–Class A Shares seeks provide long-term growth of capital. The Portfolio normally invests at least 65% of its total assets in common stock of U.S. companies. Although the Portfolio can invest in companies of any size, it generally focuses on established companies that are similar in size to the companies in the Standard & Poor’s 500 Composite Stock Price Index (the “S&P 500 Index”) or the Russell 1000 Growth Index. In choosing stocks, the Portfolio managers look for individual companies that havethe potential to display above-average earnings growth compared to other growth companies and that have strong product lines, effective management and leadership positions within core markets.

DWS Health Care VIP–Class A Shares under normal circumstances, the Portfolio seeks long-term growth of capital by investing at least 80% of total assets, plus the amount of any borrowings for investment purposes, in common stocks of companies in the health care sector.

DWS Blue Chip VIP –Class A Shares seeks growth of capital and income. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in common stocks of large US companies that are similar in size to the companies in the S&P 500 Index and that the Portfolio managers consider to be “blue chip” companies. Blue chip companies are large, well-known companies that typically have an established earnings and dividends history, easy access to credit, solid positions in their industries and strong management.

DWS Dreman High Return Equity VIP–Class A Shares seeks to achieve a high rate of total return. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in common stocks and other equity securities. The Portfolio focuses on stocks of large US companies that are similar in size to the companies in the S&P 500 Index and that the Portfolio managers believe are undervalued. Sub-advised by Dreman Value Management LLC.

DWS Dreman Small Mid Cap Value VIP–Class A Shares (formerly DWS Dreman Small Cap Value VIP) seeks long-term capital appreciation. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in undervalued common stocks of small and mid-size U.S. companies. Sub-advised by Dreman Value Management LLC.

DWS Large Cap Value VIP –Class A Shares seeks to achieve a high rate of total return. Under normal circumstances, the Portfolio invests at least 80% of net assets, plus the amount of any borrowings for investment purposes, in common stocks and other equity securities of large US companies that are similar in size to the companies in the Russell 1000 Value Index and that the Portfolio managers believe are undervalued. Sub-advised by Deutsche Asset Management International GmbH.

DWS Small Cap Growth VIP–Class A Shares seeks maximum appreciation of investors’ capital. Under normal circumstances, the Portfolio invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in small capitalization stocks similar in size to those comprising the Russell 2000 Growth Index.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

DWS Small Cap Index VIP –Class A Shares seeks to replicate, as closely as possible, before the deduction of expenses, the performance of the Russell 2000 Small Stock Index, which emphasizes stock of small US companies. The Russell 2000 Index emphasizes stocks of small U.S. companies and is a widely accepted benchmark of small-company stock performance. Under normal circumstances, the Portfolio intends to invest at least 80% of its assets, determined at the time of purchase, in stocks of companies included in the Russell 2000 Index and in derivative instruments, such as futures contracts and options, that provide exposure to the stocks of companies in the Russell 2000 Index. Sub-advised by Northern Trust Investments, N.A.

Federated Insurance Series

Federated Fund for U.S. Government Securities II seeks to provide current income. The Portfolio’s overall strategy is to invest in a portfolio consisting primarily of United States Treasury securities, United States government agency securities (including mortgage-backed securities issued or guaranteed by United States government agencies or instrumentalities), investment-grade non-governmental mortgage-backed securities and related derivative contracts. Advised by Federated Equity Management Company of Pittsburgh, Pennsylvania.

Federated International Equity Fund II seeks to obtain a total return on its assets. The Portfolio’s total return will consist of two components: (1) changes in the market value of its portfolio securities (both realized and unrealized appreciation); and (2) income received from its portfolio securities. The Portfolio expects that changes in market value will comprise the largest component of its total return. The Portfolio pursues its investment objective by investing primarily in equity securities of companies based outside the United States. The Portfolio’s investment adviser uses a “bottom-up” approach to stock selection and selection of industry and country are secondary considerations. The Portfolio is not limited to investing according to any particular style, size of company or maintaining minimum allocations to any particular region or country. However, the adviser anticipates that normally the Portfolio will primarily invest in mid- to large-capitalization companies based outside the United States that have been selected using the growth style of stock selection. The Portfolio may invest up to 20% of its assets in foreign companies based in emerging markets. The Portfolio limits its investments to those that would enable it to qualify as a permissible investment for variable annuity contracts and variable life insurance policies issued by insurance companies. Advised by Federated Global Investment Management Company of New York, New York.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Franklin Small Cap Value Securities Fund–Class I Shares seeks long-term total return. The Portfolio normally invests at least 80% of its net assets in investments of small capitalization companies and normally invests predominantly in equity securities.

Janus Aspen Series—advised by Janus Capital Management LLC of Denver, Colorado.

Janus Aspen Series Balanced Portfolio–Institutional Sharesseeks long-term capital growth, consistent with preservation of capital and balanced by current income. The Portfolio normally invests 50-60% of its assets in equity securities selected primarily for their growth potential and 40-50% of its assets in securities selected primarily for their income potential. The Portfolio normally invests at least 25% of its assets in fixed-income senior securities.

Effective May 1, 2007, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Series Flexible Bond Portfolio–Institutional Shares seeks to obtain maximum total return, consistent with preservation of capital. The Portfolio invests, under normal circumstances, at least 80% of its assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The Portfolio will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The Portfolio will limit its investment in high-yield/high-risk bonds to 35% or less of its net assets. This Portfolio generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.

Effective May 1, 2007, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Series Growth and Income Portfolio-Institutional Shares seeks long-term capital growth and current income. The Portfolio will normally invest up to 75% of its assets in equity securities selected primarily for their growth potential, and at least 25% of its assets in securities the Portfolio manager believes have income potential. Equity securities may make up part or all of this income component if they currently pay dividends or the Portfolio manager believes they have potential for increasing or commencing dividend payments. The Portfolio is not designed for investors who need consistent income, and the Portfolio’s investment strategies could result in significant fluctuations of income.

Effective May 1, 2007, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Series Worldwide Growth Portfolio-Institutional Sharesseeks long-term growth of capital in a manner consistent with the preservation of capital. The Portfolio invests primarily in common stocks of companies of any size throughout the world. The Portfolio normally invests in issuers from several different countries, including the United States. The Portfolio may, under unusual circumstances, invest in a single country. The Portfolio may have significant exposure to emerging markets.

Effective April 29, 2005, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Janus Aspen Series Balanced Portfolio–Service Sharesseeks long-term capital growth, consistent with preservation of capital and balanced by current income. The Portfolio normally invests 50-60% of its assets in equity securities selected primarily for their growth potential and 40-50% of its assets in securities selected primarily for their income potential. The Portfolio normally invests at least 25% of its assets in fixed-income senior securities.

Janus Aspen Series Flexible Bond Portfolio–Service Shares seeks to obtain maximum total return, consistent with preservation of capital. The Portfolio invests, under normal circumstances, at least 80% of its assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The Portfolio will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The Portfolio will limit its investment in high-yield/high-risk bonds to 35% or less of its net assets. This Portfolio generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.

Janus Aspen Series Growth and Income Portfolio–Service Shares seeks long-term capital growth and current income. The Portfolio will normally invest up to 75% of its assets in equity securities selected primarily for their growth potential, and at least 25% of its assets in securities the Portfolio manager believes have income potential. Equity securities may make up part or all of this income component if they currently pay dividends or the Portfolio manager believes they have potential for increasing or commencing dividend payments. The Portfolio is not designed for investors who need consistent income, and the Portfolio’s investment strategies could result in significant fluctuations of income.

JPMorgan Small Company Portfolio seeks to provide high total return from a portfolio of small company stocks. Under normal circumstances, the Portfolio invests at least 80% of its assets (net assets plus the amount of borrowing for investment purposes) in equity securities of small-cap companies. These small-cap securities will be primarily securities of companies located in the U.S. Small–cap companies are companies with market capitalizations equal to those within the universe of the Russell 2000^® Index at the time of purchase. Market capitalization is the total market value of a company’s shares. Sector by sector, the Portfolio’s weightings are similar to those of the Russell 2000^® Index. The Portfolio can moderately underweight or over weight sectors when it believes it will benefit performance.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Lincoln Variable Insurance Products Trust—advised by Lincoln Investment Advisors Corporation of Fort Wayne, Indiana, and sub-advised by BAMCO, Inc. of New York, New York.

LVIP Baron Growth Opportunities Fund–Service Class seeks capital appreciation through long-term investments in securities of small and medium sized companies with undervalued assets or favorable growth prospects.

MFS Variable Insurance Trust—advised by Massachusetts Financial Services Company of Boston, Massachusetts.

MFS VIT Utility Series–Service Class seek total return. The Portfolio’s objective may be changed without shareholder approval. MFS normally invests at least 80% of the Portfolio’s net assets in securities of issuers in the utilities industry. MFS considers a company to be in the utilities industry if, at the time of investment, MFS determines that a substantial portion (i.e., at least 50%) of the company’s assets or revenues are derived from one or more utilities. Issuers in the utilities industry include issuers engaged in the manufacture, production, generation, transmission, sale or distribution of electric, gas or other types of energy, water or other sanitary services; and issuers engaged in telecommunications, including telephone, cellular telephone, telegraph, satellite, microwave, cable television, and other communications media (but not engaged in public broadcasting). MFS primarily invests the Portfolio’s assets in equity securities, but may also invest in debt instruments. MFS primarily invests the Portfolio’s investments in debt instruments in investment grade debt instruments, but may also invest in lower quality debt instruments. MFS may invest the Portfolio’s assets in companies of any size. MFS may invest the Portfolio’s assets in U.S. and foreign securities, including emerging market securities. MFS may use derivatives for different purposes, including to earn income and enhance returns, to increase or decrease exposure to a particular market, to manage or adjust the risk profile of the Portfolio, or as alternatives to direct investments. MFS uses a bottom-up investment approach in buying and selling investments for the Portfolio. Investments are selected primarily based on fundamental analysis of issuers or instruments in light of market, economic, political, and regulatory conditions. Factors considered for equity securities may include analysis of earnings, cash flows, competitive position, and management ability. Quantitative analysis of these and other factors may also be considered. Factors considered for debt instruments may include the instrument’s credit quality, collateral characteristics and indenture provisions and the issuer’s management ability, capital structure, leverage, and ability to meet its current obligations. Quantitative analysis of the structure of a debt instrument and its features may also be considered. MFS may engage in active and frequent trading in pursuing the Portfolio's principal investment strategies. In response to market, economic, political, or other conditions, MFS may depart from the Portfolio’s principal investment strategies by temporarily investing for defensive purposes.

Nationwide Variable Insurance Trust—advised by Nationwide Fund Advisors of Conshohocken, Pennsylvania, and sub-advised by BlackRock Investment Management, LLC of Plainsboro, New Jersey.

NVIT Mid Cap Index Fund-Class II Sharesseeks capital appreciation. Under normal conditions, the Portfolio invests at least 80% of the value of its net assets in a statistically selected sample of equity securitiesof companies included in the S&P 400® and in derivativeinstruments linked to the S&P 400®, primarily futures contracts.

Neuberger Berman Advisers Management Trust—advised by Neuberger Berman Management, Inc. of New York, New York.

Neuberger Berman AMT Regency Portfolio–Class S Shares seeks growth of capital by investing mainly in common stocks of mid-capitalization companies. The Portfolio seeks to reduce risk by diversifying among many companies, industries and sectors.

Old Mutual Large Cap Growth Portfolio seeks to provide investors with long-term growth of capital. The Portfolio normally invests at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in equity securities of large-cap companies with favorable growth prospectus. For purposes of this Portfolio, large-cap companies are those companies with market capitalizations within the market capitalization range of those companies in the Russell 1000^® Growth Index. As of February 29, 2008, the Russell 1000^® Growth Index included companies with market capitalizations between $0.3 billion and $490 billion. The market capitalization of the companies in the Portfolio’s holdings and the Russell 1000^® Growth Index changes over time and the Portfolio will not automatically sell or stop buying stock of a company it already owns if the company’s market capitalization grows or falls out of this range. Equity securities in which the Portfolio may invest include common and preferred stocks.

Effective May 1, 2006, the Sub-Account investing in this Portfolio was closed to new Contributions and incoming Transfers (including Automatic Custom Transfers).

Oppenheimer Variable Account Funds—advised by OppenheimerFunds, Inc. of New York, New York.

Oppenheimer Global Securities Fund/VA seeks capital appreciation. Under normal market conditions, the Portfolio invests mainly in common stocks of U.S. and foreign companies. The Portfolio can invest without limit in foreign securities and can invest in any country, including countries with developed or emerging markets. However, the Portfolio currently emphasizes investments in developed markets such as the United States, Western Europe countries and Japan. The Portfolio does not limit its investments to companies in a particular capitalization range, but currently focuses its investments in mid- and large-cap companies. The Portfolio is not required to allocate its investments in any set percentages in any particular countries. As a fundamental policy, the Portfolio normally will invest in at least three countries (one of which may be the United States). Typically, the Portfolio invests in a number of different countries.

Oppenheimer International Growth Fund/VA seeks long-term growth of capital by investing under normal circumstances, at least 90% of its total assets in equity securities of companies wherever located, the primary stock market of which is outside the United States. The Portfolio currently invests mainly in common stocks of foreign growth companies listed on foreign stock exchanges. They can include both smaller, less-well-known companies and larger, more established companies that the portfolio manager believes have favorable prospects for capital growth relative to the market. The Portfolio does not limit its investments to issuers within a specific market capitalization range. Although the Portfolio currently has an emphasis on mid-size companies, the Portfolio’s emphasis may change over time. It can invest up to 25% of its total assets in emerging markets and can invest without limit in developed markets throughout the world. The Portfolio may increase the relative emphasis of its investments in one or more industries, countries, or regions from time to time, such as Europe or Asia, for example. The Portfolio can also buy preferred stocks, securities convertible into common stocks and other securities having equity features. The Portfolio can invest up to 20% of its total assets in debt securities when the Portfolio manager believes that it is appropriate to do so in order to seek the Portfolio’s objective. The Portfolio typically does not invest in debt securities to a significant degree. The Portfolio can also use hedging instruments and certain derivative investments to try to manage investment risk.

PIMCO VIT High Yield Portfolio–Administrative Class Shares seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 80% of its assets in a diversified portfolio of high yield securities (“junk bonds”) rated below investment grade but rated at least Caa by Moody’s or CCC by S&P, or, if unrated, determined by PIMCO to be of comparable quality, subject to a maximum of 5% of its total assets in securities rated Caa by Moody’s or CCC by S&P, or, if unrated, determined by PIMCO to be of comparable quality. The remainder of the Portfolio’s assets may be invested in investment grade Fixed Income Instruments. The average portfolio duration of this Portfolio normally varies within a two- to six-year time frame based on PIMCO’s forecast for interest rates. The Portfolio may invest up to 20% of its total assets in securities denominated in

foreign currencies and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. The Portfolio normally will limit its exposure to foreign currency (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets.

PIMCO VIT Low Duration Portfolio–Administrative Class Shares seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing, under normal circumstances, at least 65% of its total assets in a diversified portfolio of fixed income instruments of varying maturities. The average portfolio duration of this Portfolio normally varies within a one- to three-year time frame based on PIMCO's forecast for interest rates. The Portfolio invests primarily in investment grade debt securities, but may invest up to 10% of its total assets in high- yield securities ("junk bonds") rated B or higher by Moody's or S&P, or, if unrated, determined by PIMCO to be of comparable quality. The Portfolio may invest up to 30% of its total assets in securities denominated in foreign currencies, and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. The Portfolio will normally limit its foreign currency exposure (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets. The Portfolio may invest all of its assets in derivative instruments, such as options, futures contracts, or swap agreements, or in mortgage- or asset-backed securities. The Portfolio may, without limitation, seek to obtain market exposure to the securities in which it primarily invests by entering into a series of purchase and sale contracts or by using other investment techniques (such as buy backs or dollar rolls). The "total return" sought by the Portfolio consists of income earned on the Portfolio's investments, plus capital appreciation, if any, which generally arises from decreases in interest rates or improving credit fundamentals for a particular sector or security.

PIMCO VIT Total Return Portfolio–Administrative Class Shares seeks maximum total return, consistent with preservation of capital and prudent investment management. The Portfolio seeks to achieve its investment objective by investing under normal circumstances at least 65% of its total assets in a diversified portfolio of fixed income instruments of varying maturities. The average portfolio duration of this Portfolio normally varies within a three-to six-year frame based on PIMCO’s forecast for interest rates. The Portfolio invests primarily in investment grade debt securities, but may invest up to 10% of its total assets in high yield securities (“junk bonds”) rated B or higher by Moody’s or S&P or, if unrated, determined by PIMCO to be of comparable quality. The Portfolio may invest up to 30% of its total assets in securities denominated in foreign currencies, and may invest beyond this limit in U.S. dollar-denominated securities of foreign issuers. The Portfolio will normally limit its foreign currency exposure (from non-U.S. dollar-denominated securities or currencies) to 20% of its total assets.

Pioneer Investments, Inc.—advised by Pioneer Investment Management, Inc. of Boston, Massachusetts.

Pioneer Emerging Markets VCT – Class 2 Shares The Portfolio invests primarily in securities of emerging market issuers. Although the Portfolio invests in both equity and debt securities, it normally emphasizes equity securities in its portfolio. Normally, the Portfolio invests at least 80% of its total assets in the securities of emerging market corporate and government issuers, i.e., securities of companies that are domiciled or primarily doing business in emerging countries and securities of these countries' governmental issuers.

Pioneer Fund VCT Portfolio–Class I Shares seeks reasonable income and capital growth. The Portfolio invests in a broad range of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The Portfolio invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the Portfolio’s investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as exchange-traded funds (ETFs) that invest primarily in equity securities, equity interests in real estate investment trusts (REITs), depositary receipts, warrants, rights and preferred stocks.

Pioneer Growth Opportunities VCT Portfolio–Class I Shares seeks growth of capital. To achieve its objective, under normal circumstances the Portfolio invests most of its assets in equity securities of companies the advisor considers to be reasonably priced or undervalued, with above average growth potential.For purposes of the Portfolio’s investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as exchange-traded funds (ETFs) that invest primarily in equity securities, depositary receipts, equity interests in real estate investment trusts (REITs), warrants, rights and preferred stocks.

Pioneer Mid Cap Value VCT Portfolio–Class II Shares seeks capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks. Normally, the Portfolio invests at least 80% of its total assets in equity securities of mid-size companies. Mid-sized companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell Midcap Valur Index or the 3-year rolling average of the market capitalization of the largest company within the Russell Midcap Value Index as measured at the end of the preceding month and are not less than the smallest company within the index. The size of the companies in the

index changes with market conditions and the composition of the index. The equity securities in which the Portfolio principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the Portfolio may invest in other types of equity securities to a lesser extent, such as exchange-traded funds (ETFs) that invest primarily in equity securities, equity interests in real estate investment trust (REITs), warrants and rights.

Pioneer Small Cap Value VCT Portfolio–Class I Shares seeks capital growth by investing in a diversified portfolio of securities, consisting primarily of common stocks. To achieve its objective, under normal circumstances the Portfolio invests at least 80% of its net assets (plus any borrowings for investment purposes) in equity and equity-related securities of small companies with total market capitalization at the time of investment of less than $1.5 billion. Small companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell 2000 Index or the 3-year rolling average of the market capitalization of the largest company within the Russell 2000 Index as measured at the end of the preceding month. The size of the companies in the index changes with market conditions and the composition of the index. Pioneer monitors the Portfolio so that, under normal circumstances, the capitalization range of the Portfolio is consistent with the inclusion of the Portfolio in the Lipper Small-Cap category. For purposes of the Portfolio’s investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as exchange-traded funds (ETFs) that invest primarily in equity securities, depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.

Schwab Annuity Portfolios—advised by Charles Schwab Investment Management, Inc. of San Francisco, California.

Schwab MarketTrack Growth Portfolio II™seeks to provide high capital growth with less volatility than an all stock portfolio.

Schwab Money Market Portfolio™seeks the highest current income consistent with stability of capital and liquidity. This Portfolio is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. There can be no assurance that it will be able to maintain a stable net asset value of $1.00 per share.

Schwab S&P 500 Index Portfolio seeks to track the price and dividend performance (total return) of stocks of U.S. companies, as represented in the Standard & Poor’s Composite Stock Price Index (the S&P 500).

Seligman Portfolios, Inc.—advised by J.& W. Seligman & Co. Incorporated, New York , New York.

Seligman Communications and Information Fund–Class 2 Shares seeks capital gain. The Portfolio invests at least 80% of its net assets in securities of companies operating in the communications, information, and related industries. The Portfolio may invest in companies of any size.

Third Avenue Variable Series Trust—advised by Third Avenue Management LLC, of New York, New York.

Third Avenue Value Portfolio–Variable Series Trust Shares -seeks long-term capital appreciation mainly by acquiring common stocks of well-financed companies (meaning companies without significant liabilities in comparison to their overall resources) at a discount to what the adviser believes is their intrinsic value. The Portfolio also seeks to acquire senior securities, such as preferred stocks, and debt instruments (including high-yield securities) that the adviser believes are undervalued. Acquisitions of these senior securities and debt instruments will generally be limited to those providing: (1) protection against the issuer taking certain actions which could reduce the value of the security; and (2) above-average current yields, yields to events (e.g., acquisitions and recapitalizations), or yields to maturity. The Portfolio invests in companies regardless of market capitalization, although it frequently finds value in companies with a smaller capitalization. It also invests in both domestic and foreign securities. The mix of the Portfolio’s investments at any time will depend on the industries and types of securities the adviser believes hold the most value within the Portfolio’s investment strategy.

Van Kampen Life Investment Trust—advised by Van Kampen Asset Management, a wholly-owned subsidiary of Van Kampen Investments, Inc.

Van Kampen LIT Comstock–Class I Shares seeks capital growth and income through investments in equity securities, including common stocks, preferred stocks and securities convertible into common and preferred stocks.

Van Kampen LIT Growth and Income–Class I Shares seeks long-term growth of capital and income. The Portfolio may invest up to 15% of its assets in equity real estate investment trusts (“REITs”).

Wells Fargo Advantage Funds—advised by Wells Fargo Funds Management, LLC, a subsidiary of Wells Fargo & Company headquartered in San Francisco, California.

Wells Fargo Advantage VT Discovery Fund–Class VT Shares seeks long-term capital appreciation. The Portfolio invests in equity securities of small- and medium-capitalization companies that we believe offer favorable opportunities for growth. We

define small- and medium-capitalization companies as those with market capitalizations at the time of purchase equal to or lower than the company with the largest market capitalization in the Russell Midcap^® Index. We may also invest in equity securities of foreign issuers through ADRs and similar investments.

Wells Fargo Advantage VT Opportunity Fund–Class VT Shares seeks long-term capital appreciation. The Portfolio invests principally in equity securities of medium-capitalization companies, which we define as those within the range of market capitalizations of companies in the Russell MidCap^® Index. We may also invest in equity securities of foreign issuers through ADRs and similar investments.

Meeting Investment Objectives

Meeting investment objectives depends on various factors, including, but not limited to, how well the Portfolio managers anticipate changing economic and market conditions. There is no guarantee that any of these Portfolios will achieve their stated objectives.

Where to Find More Information About the Portfolios

Additional information about the investment objectives and policies of all the Portfolios and the investment advisory and administrative services and charges can be found in the current Portfolio Prospectuses, which can be obtained from Schwab Insurance Services. You may also visit www.schwab.com/annuities .

The Portfolio prospectuses should be read carefully before any decision is made concerning the allocation of Contributions to, or Transfers among, the Sub-Accounts.

Addition, Deletion or Substitution

Great-West does not control the Portfolios and cannot guarantee that any of the Portfolios will always be available for allocation of Contributions or Transfers. We retain the right to make changes in the Series Account and in its investments. Currently, Schwab must approve certain changes.

Great-West and Schwab reserve the right to discontinue the offering of any Portfolio. If a Portfolio is discontinued, we may substitute shares of another Portfolio or shares of another investment company for the discontinued Portfolio’s shares. Any share substitution will comply with the requirements of the 1940 Act.

If you are contributing to a Sub-Account corresponding to a Portfolio that is being discontinued, you will be given notice prior to the Portfolio’s elimination.

Based on marketing, tax, investment and other conditions, we may establish new Sub-Accounts and make them available to Owners at our discretion. Each additional Sub-Account will purchase shares in a Portfolio or in another mutual fund or investment vehicle.

If, in our sole discretion, marketing, tax, investment or other conditions warrant, we may also eliminate one or more Sub-Accounts. Before a Sub-Account is eliminated, we will notify you and request that you reallocate the amounts invested in the Sub-Account to be eliminated.

Application and Initial Contributions

The first step to purchasing the Schwab OneSource Annuity is to complete your Contract application and submit it with your initial minimum Contribution of $5,000. Initial Contributions can be made by check (payable to GWL&A) or transferred from a Schwab brokerage account. You also may purchase the Contract through a 1035 Exchange provided that the contract you are exchanging for the Schwab OneSource Annuity has a cash value of at least $5,000.

The Contract application and any initial contributions made by check should be sent to Schwab Insurance Services, P.O. Box 7666, San Francisco, CA 9412-9639.

If your application is complete, your Contract will be issued and your Contribution will be credited within two business days after receipt by Great-West. Acceptance is subject to sufficient information in a form acceptable to us. We reserve the right to reject any application or Contribution.

If your application is incomplete, it will be completed from information Schwab has on file or you will be contacted by telephone or email to obtain the required information. If the information necessary to complete your application is not received

within five business days, we will return to you both your check and the application. If you provide consent we will retain the initial Contribution and credit it as soon as we have completed your application.

Right of Cancellation Period

During the Right of Cancellation period (ten-days or longer where required by state law), you may cancel your Contract. If you exercise your Right of Cancellation, you must return the Contract to Great-West or to the representative from whom you purchased it.

Generally, Contributions will be allocated to the Sub-Accounts you selected on the application, effective upon the Effective Date. During the Right of Cancellation period, you may change your Sub-Account allocations as well as your allocation percentages.

Contracts returned during the Right of Cancellation period will be void from the date we issued the Contract. In the majority of states, we will refund your current Annuity Account Value. This amount may be higher or lower than your Contributions, which means you bear the investment risk during the Right of Cancellation period.

Certain states require that we return the greater of your Annuity Account Value (less any surrenders, withdrawals, and distributions already received) or the amount of Contributions received. In those states, all Contributions will be processed as follows:

•	Amounts you specify to be allocated to one or more of the Sub-Accounts will first be allocated to the Schwab Money Market Sub-Account.

•	After the end of the Right of Cancellation period, the Annuity Account Value held in the Schwab Money Market Sub-Account will be allocated to the Sub-Accounts you selected on the application.

Amounts contributed from a 1035 exchange of the Schwab Select Annuity Contract will be immediately allocated to the Sub-Accounts you have selected. If the Contract is returned, it will be void from the start. In many states, we will refund the Annuity Account Value (less any surrenders, withdrawals, and distributions already received) effective as of the Transaction Date the Contract is returned and received by us. This amount may be an amount that is higher or lower than your Contribution from the Schwab Select Annuity Contract, which means that you bear the investment risk during the Right of Cancellation period. Certain states will require that we return the greater of: (a) Contributions received, or (b) the Annuity Account Value (less any surrenders, withdrawals, and distributions already received) effective as of the Transaction Date the Contract is returned and received by us.

Subsequent Contributions

Once your application is complete and we have received your initial Contribution, you can make subsequent Contributions at any time prior to the Payout Commencement Date, as long as the Annuitant is living. Additional Contributions must be at least $500; or $100 if made via an Automatic Bank Draft Plan. Total Contributions may exceed $1,000,000 only with our prior approval.

Subsequent Contributions can be made by check or via an Automatic Bank Draft Plan directly from your bank or savings account. You can designate the date you would wish your subsequent Contributions deducted from your account each month. If you make subsequent Contributions by check, your check should be payable to GWL&A.

You will receive a confirmation of each Contribution you make upon its acceptance. Subsequent Contributions are credited the day they are received in the Annuity Service Center Department at GWL&A if they are received on a day the New York Stock Exchange is open and received prior to 4 p.m. Eastern time. Subsequent Contributions received on days the New York Stock Exchange is closed or received after 4 p.m. Eastern time on a day the New York Stock Exchange is open, will be credited the next business day.

If you cancel a purchase payment or if your check is returned due to insufficient funds, you will be responsible for any losses or fees imposed by your bank and losses that may be incurred as a result of any decline in the value of the cancelled purchase. We reserve the right to refrain from allocating Contributions to your selected Sub-Accounts until we are notified by your bank that your check has cleared.

Great-West reserves the right to modify the limitations set forth in this section.

Annuity Account Value

Before the date annuity payouts begin, the value of your Contract is the Annuity Account Value, which, before your Annuity Commencement Date, is the total dollar amount of all accumulation units credited to you for each Sub-Account. Initially, the value of each accumulation unit was set at $10.00.

Each Sub-Account's value prior to the Payout Commencement Date is equal to:

•	net Contributions allocated to the corresponding Sub-Account,

•	plus or minus any increase or decrease in the value of the assets of the Sub-Account due to investment results,

•	minus the daily mortality and expense risk charge, and

•	minus any withdrawals or Transfers from the Sub-Account.

The value of a Sub-Account's assets is determined at the end of each day that the New York Stock Exchange is open for regular business (a valuation date). A valuation period is the period between successive valuation dates. It begins at the close of the New York Stock Exchange (generally 4:00 p.m. Eastern time) on each valuation date and ends at the close of the New York Stock Exchange on the next succeeding valuation date.

The Annuity Account Value is expected to change from valuation period to valuation period, reflecting the investment experience of the selected Sub-Account(s), as well as the deductions for applicable charges.

Upon allocating Contributions to a Sub-Account you will be credited with variable accumulation units in that Sub-Account. The number of accumulation units you will be credited is determined by dividing the portion of each Contribution allocated to the Sub-Account by the value of an accumulation unit. The value of the accumulation unit is determined and credited at the end of the valuation period during which the Contribution was received.

Each Sub-Account’s accumulation unit value is established at the end of each valuation period. It is calculated by multiplying the value of that unit at the end of the prior valuation period by the Sub-Account's Net Investment Factor for the valuation period. The formula used to calculate the Net Investment Factor is discussed in Appendix B.

Unlike a brokerage account, amounts held under a Contract are not covered by the Securities Investor Protection Corporation (“SIPC”).

Transfers

At any time while your Contract is in force, you may Transfer all or part of your Annuity Account Value among and between the Sub-Accounts by telephone, in writing by sending a Request to Schwab Insurance Services, or through the Internet at www.schwab.com/annuity where you will be redirected to a Great-West website where you may make the Transfer. Incoming Transfers to closed Sub-Accounts are not permitted.

Your Request must specify:

•	the amounts being Transferred,

•	the Sub-Account(s) from which the Transfer is to be made, and

•	the Sub-Account(s) that will receive the Transfer.

Currently, there is no limit on the number of Transfers you can make among the Sub-Accounts during any calendar year. However, we reserve the right to limit the number of Transfers you make. Also, there is currently no charge for Transfers. We reserve the right to impose such a charge in the future. If we choose to exercise these rights, we will notify you by sending you a supplement to this prospectus, in accordance with all applicable regulations.

A Transfer generally will be effective on the date the Request for Transfer is received by Schwab Insurance Services if received before 4:00 p.m. Eastern time. Any Transfer request received after 4:00 p.m. Eastern time becomes effective on the following business day we and the New York Stock Exchange are open for business. Under current tax law, there will not be any tax liability to you if you make a Transfer.

Transfers involving the Sub-Accounts will result in the purchase and/or cancellation of accumulation units having a total value equal to the dollar amount being transferred. The purchase and/or cancellation of such units is made using the value of the Sub-Accounts as of the end of the valuation date on which the Transfer is effective.

We reserve the right without prior notice to modify, restrict, suspend, or eliminate the Transfer privileges (including telephone and/or Internet Transfers) at any time.

At present, we do not impose minimums on amounts that must be transferred. However, we reserve the right to impose, from time to time, minimum dollar amounts that may be transferred from a Sub-Account.

We also reserve the right to impose, from time to time, minimum dollar amounts that must remain in a Sub-Account after giving effect to a Transfer from that Sub-Account. At present, we do not impose any such minimums.

Market Timing and Excessive Trading

The Contracts are intended for long-term investment and not for the purpose of market timing or excessive trading activity. Market timing activity may dilute the interests of Contract Owners in the underlying Portfolios. Market timing generally involves frequent or unusually large Transfers that are intended to take advantage of short-term fluctuations in the value of a Portfolio's portfolio securities and the reflection of that change in the Portfolio's share price. In addition, frequent or unusually large Transfers may harm performance by increasing Portfolio expenses and disrupting Portfolio management strategies. For example, excessive trading may result in forced liquidations of portfolio securities or cause the Portfolio to keep a relatively higher cash position, resulting in increased brokerage costs and lost investment opportunities.

We maintain procedures designed to prevent or minimize market timing and excessive trading (collectively, “prohibited trading”) by Owners. As part of those procedures, certain of the Portfolios have instructed us to perform standardized trade monitoring, while other Portfolios perform their own monitoring and request reports of the Owner's trading activity if prohibited trading is suspected. If an Owner’s trading activity is determined to constitute prohibited trading, as defined by the applicable Portfolio, Great-West will notify the Owner that a trading restriction will be implemented if the Owner does not cease the prohibited trading. Some Portfolios may require that trading restrictions be implemented immediately without warning, in which case we will notify the Owner of the restriction imposed by the Portfolio(s), as applicable.

If a Portfolio determines, or, for Portfolios for which we perform trade monitoring, we determine based on the applicable Portfolio’s definition of prohibited trading, that the Owner continues to engage in prohibited trading, we will restrict the Owner from making Transfers into the identified Portfolio(s) for the period of time specified by the Portfolio(s). Restricted Owners will be permitted to make Transfers out of the identified Portfolio(s) to other available Portfolio(s). When the Portfolio’s restriction period has been met, the Owner will automatically be allowed to resume Transfers into the identified Portfolio(s).

For Portfolios that perform their own monitoring, the Series Account does not impose trading restrictions unless or until a Portfolio first detects and notifies us of prohibited trading activity. Accordingly, we cannot prevent all prohibited trading activity before it occurs, as it may not be possible to identify it unless and until a trading pattern is established. To the extent such Portfolios do not detect and notify us of prohibited trading or the trading restrictions we impose fail to curtail it, it is possible that a market timer may be able to make prohibited trading transactions with the result that the management of the Portfolios may be disrupted and the Owners may suffer detrimental effects such as increased costs, reduced performance, and dilution of their interests in the affected Portfolios.

We endeavor to ensure that our procedures are uniformly and consistently applied to all Owners, and we do not exempt any persons from these procedures. We do not enter into agreements with Owners whereby we permit prohibited trading. Subject to applicable state law and the terms of each Contract, we reserve the right without prior notice to modify, restrict, suspend or eliminate the Transfer privileges (including telephone Transfers) at any time, to require that all Transfer Requests be made by you and not by your designee, and to require that each Transfer Request be made by a separate communication to us. We also reserve the right to require that each Transfer Request be submitted in writing and be signed by you.

The Portfolios may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares. The prospectuses for the Portfolios should describe any policies and procedures relating to restricting prohibited trading. The frequent trading policies and procedures of a Portfolio may be different, and more or less restrictive, than the frequent trading policies and procedures of other Portfolios and the policies and procedures we have adopted to discourage prohibited trading. For example, a Portfolio may impose a redemption fee. The Owner should also be aware that we are legally obligated to provide (at the Portfolios’ request) information about each amount you cause to be deposited into a Portfolio (including by way of premium payments and Transfers under your Contract) or removed from the Portfolio (including by way of withdrawals and Transfers under your Contract). If a Portfolio identifies you as having violated the Portfolio’s frequent trading policies and procedures, we are obligated, if the Portfolio requests, to restrict or prohibit any further deposits or exchanges by you in respect to that Portfolio. Under rules recently adopted by the SEC we are required to: (1) enter into a written agreement with each Portfolio or its principal underwriter that will obligate us to provide to the Portfolio promptly upon request certain information about the trading activity of individual Owners and (2) execute instructions from the Portfolio to restrict or prohibit further purchases or Transfers by specific Owners who violate the frequent trading policies established by the Portfolio. Accordingly, if you do not comply with any Portfolio’s frequent trading policies and procedures, you may be prohibited from directing any additional amounts into that Portfolio or directing any Transfers or other exchanges involving that Portfolio. You should review and comply with each Portfolio’s frequent trading policies and procedures, which are disclosed in the Portfolios’ current prospectuses.

We may revise our market timing and excessive trading policy and related procedures at our sole discretion, at any time and without prior notice, as we deem necessary or appropriate to comply with state or federal regulatory requirements or to impose

additional or alternative restrictions on Owners engaging in prohibited trading. In addition, our orders to purchase shares of the Portfolios are generally subject to acceptance by the Portfolio, and in some cases a Portfolio may reject or reverse our purchase order. Therefore, we reserve the right to reject any Owner's Transfer Request if our order to purchase shares of the Portfolio is not accepted by, or is reversed by, an applicable Portfolio.

You should note that other insurance companies and retirement plans may also invest in the Portfolios and that those companies or plans may or may not have their own policies and procedures on frequent Transfers. You should also know that the purchase and redemption orders received by the Portfolios generally are "omnibus" orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. Omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan Owners and/or individual owners of variable insurance contracts. The nature of such orders may limit the Portfolios' ability to apply their respective frequent trading policies and procedures. As a result, there is a risk that the Portfolios may not be able to detect potential prohibited trading activities in the omnibus orders they receive. We cannot guarantee that the Portfolios will not be harmed by Transfer activity relating to the retirement plans and/or other insurance companies that invest in the Portfolios. If the policies and procedures of other insurance companies or retirement plans fail to successfully discourage frequent Transfer activity, it may affect the value of your investments in the Portfolios. In addition, if a Portfolio believes that an omnibus order we submit may reflect one or more Transfer Requests from a Owner engaged in frequent Transfer activity, the Portfolio may reject the entire omnibus order and thereby interfere with our ability to satisfy your Request even if you have not made frequent Transfers. For Transfers into more than one investment option, we may reject or reverse the entire Transfer Request if any part of it is not accepted by or is reversed by a Portfolio.

Automatic Custom Transfers

Dollar Cost Averaging

You may arrange for systematic Transfers from any open Sub-Account to any other open Sub-Account. (Transfers into closed Sub-Accounts are not permitted.) These systematic Transfers may be used to Transfer values from the Schwab Money Market Sub-Account to other Sub-Accounts as part of a dollar cost averaging strategy. Dollar cost averaging allows you to buy more units when the price is low and fewer units when the price is high. Over time, your average cost per unit may be more or less than if you invested all your money at one time. However, dollar cost averaging does not assure a greater profit, or any profit, and will not prevent or necessarily alleviate losses in a declining market. There is no charge for participating in Dollar Cost Averaging.

You can set up automatic dollar cost averaging on a monthly, quarterly, semi-annual, or annual basis. Your Transfer will be initiated on the Transaction Date one frequency period following the date of the request. For example, if you request quarterly Transfers on January 9, your first Transfer will be made on April 9 and every three months on the 9th thereafter. Transfers will continue on that same day each interval unless terminated by you or for other reasons as set forth in the Contract.

If there are insufficient funds in the applicable Sub-Account on the date your Transfer is scheduled, your Transfer will not be made. However, your dollar cost averaging Transfers will resume once there are sufficient funds in the applicable Sub-Account. Dollar cost averaging will terminate automatically when you start taking payouts from the Contract. Dollar cost averaging Transfers must meet the following conditions:

•	The minimum amount that can be Transferred out of the selected Sub-Account is $100.

•

You must: (1) specify the dollar amount to be Transferred, (2) designate the Sub-Account(s) to which the Transfer will be made, and (3) designate the percentage of the dollar amount to be allocated to each Sub-Account into which you are Transferring money. The accumulation unit values will be determined on the Transfer date.

How dollar cost averaging works:

Month	Contribution	Units Purchased	Price per unit
Jan.	$250	10	$25.00
Feb.	250	12	20.83
Mar.	250	20	12.50
Apr.	250	20	12.50
May	250	15	16.67
June	250	12	20.83

Average market value per unit $18.06

Investor’s average cost per unit $16.85

In the chart above, if all units had been purchased at one time at the highest unit value of $25.00, only 60 units could have been purchased with $1500. By contributing smaller amounts over time, dollar cost averaging allowed 89 units to be purchased with $1500 at an average unit price of $16.85. This investor purchased 29 more units at $1.21 less per unit than the average market value per unit of $18.06.

You may not participate in dollar cost averaging and Rebalancer at the same time.

Great-West reserves the right to modify, suspend, or terminate dollar cost averaging at any time.

Rebalancer

Over time, variations in each Sub-Account’s investment results will change your asset allocation plan percentages. Rebalancer allows you to automatically reallocate your Annuity Account Value to maintain your desired asset allocation. Participation in Rebalancer does not assure a greater profit, or any profit, nor will it prevent or necessarily alleviate losses in a declining market. There is no charge for participating in Rebalancer.

You can set up Rebalancer as a one-time Transfer or on a quarterly, semi-annual, or annual basis. If you select to rebalance only once, the Transfer will take place on the Transaction Date of the request.

If you select to rebalance on a quarterly, semi-annual, or annual basis, the first Transfer will be initiated on the Transaction Date one frequency period following the date of the request. For example, if you request quarterly Transfers on January 9, your first Transfer will be made on April 9 and every three months on the 9th thereafter. Transfers will continue on that same day each interval unless terminated by you or for other reasons as set forth in the Contract.

How Rebalancer works:

Suppose you purchased your annuity and you decided to allocate 60% of your initial contribution to stocks; 30% to bonds and 10% to cash equivalents as in this pie chart:

Now assume that stock Portfolios outperform bond Portfolios and cash equivalents over a certain period of time. Over this period, the unequal performance may alter the asset allocation of the above hypothetical plan to look like this:

Rebalancer automatically reallocates your Annuity Account Value to maintain your desired asset allocation. In this example, the portfolio would be reallocated back to 60% in stocks; 30% in bonds; 10% in cash equivalents.

On the Transaction Date for the specified Request, assets will be automatically reallocated to the Sub-Accounts you selected. The Rebalancer option will terminate automatically when you start taking payouts from the Contract.

Rebalancer Transfers must meet the following conditions:

•	Your entire Annuity Account Value must be included (except for Sub-Accounts that are closed to new Contributions and incoming Transfers).

•	You must specify the percentage of your Annuity Account Value that you wish allocated to each Sub-Account and the frequency of rebalancing. You may modify the allocations or stop the Rebalancer option at any time.

•	You may not participate in dollar cost averaging and Rebalancer at the same time.

Great-West reserves the right to modify, suspend, or terminate the Rebalancer option at any time.

Cash Withdrawals

You may withdraw all or part of your Annuity Account Value at any time during the life of the Annuitant and prior to the date annuity payouts begin by submitting a withdrawal Request to Schwab Insurance Services or via the Internet at www.schwab.com/annuity, or www.schwaballiance.com (for clients of investment managers who are Schwab Alliance customers); however, any withdrawals over $25,000 must be submitted in writing. Withdrawals are subject to the rules below and federal or state laws, rules, or regulations may also apply. The amount payable to you if you surrender your Contract is your Annuity Account Value, less any applicable Premium Tax. No withdrawals may be made after the date annuity payouts begin.

If you request a partial withdrawal, your Annuity Account Value will be reduced by the dollar amount withdrawn and your Death Benefit, if you chose option 2, will be reduced as a sum of all Proportional Withdrawals from each Sub-Account from which partial withdrawals were made by you (for Contracts issued on or after April 30, 2004).

Partial withdrawals are unlimited. However, you must specify the Sub-Account(s) from which the withdrawal is to be made. After any partial withdrawal, if your remaining Annuity Account Value is less than $2,000, then a full surrender may be required. The minimum partial withdrawal is $500.

The following terms apply to withdrawals:

•	Partial withdrawals or surrenders are not permitted after the date annuity payouts begin.

•	A partial withdrawal or a surrender will be effective upon the Transaction Date.

Withdrawal requests must be in writing with your original signature. If your instructions are not clear, your request will be denied and no surrender or partial withdrawal will be processed.

After a withdrawal of all of your Annuity Account Value, or at any time that your Annuity Account Value is zero, all your rights under the Contract will terminate.

Tax consequences of withdrawals are detailed below, but you should consult a competent tax adviser prior to authorizing a withdrawal from your Annuity Account Value.

Withdrawals to Pay Investment Manager or Financial Advisor Fees

You may request partial withdrawals from your Annuity Account Value and direct us to remit the amount withdrawn directly to your designated Investment Manager or Financial Advisor (collectively “Consultant”). A withdrawal request for this purpose must meet the $500 minimum withdrawal requirements and comply with all terms and conditions applicable to partial withdrawals, as described above. Tax consequences of withdrawals are detailed below, but you should consult a competent tax advisor prior to authorizing a withdrawal from your Annuity Account to pay Consultant fees.

Tax Consequences of Withdrawals

Withdrawals made for any purpose may be taxable—including payments made by us directly to your Consultant.

In addition, the Code may require us to withhold federal income taxes from withdrawals and report such withdrawals to the Internal Revenue Service ("IRS"). If you request partial withdrawals to pay Consultant fees, your Annuity Account Value will be reduced by the sum of the fees paid to the Consultant and the related withholding.

You may elect, in writing, to have us not withhold federal income tax from withdrawals, unless withholding is mandatory for your Contract. If you are younger than 59½, the taxable portion of any withdrawal is generally considered to be an early withdrawal and may be subject to an additional federal penalty tax of 10%.

Some states also require withholding for state income taxes. For details about withholding, please see "Federal Tax Matters" on page 34.

Telephone and Internet Transactions

You may make Transfer requests by telephone, fax and/or by Internet. Transfer requests received before 4:00 p.m. Eastern time will be made on that day at that day’s unit value. Those received after 4:00 p.m. Eastern time will be made on the next business day we and the New York Stock Exchange are open for business, at that day’s unit value.

We will use reasonable procedures to confirm that instructions communicated by telephone, fax and/or Internet are genuine, such as:

•	requiring some form of personal identification prior to acting on instructions;

•	providing written confirmation of the transaction; and/or

•	tape recording the instructions given by telephone.

If we follow such procedures we will not be liable for any losses due to unauthorized or fraudulent instructions.

We reserve the right to suspend telephone, fax and/or Internet transaction privileges at any time, for some or all Contracts, and for any reason. Neither partial withdrawals nor surrenders are permitted by telephone; however partial withdrawal Requests in the amount of $25,000 or less may be requested by Internet. All Requests for full surrenders, periodic withdrawals, and partial withdrawals in excess of $25,000 must be in writing.

Death Benefit

At the time you apply to purchase the Contract, you select one of the two Death Benefit options we offer. For Option 1, the Owner, Annuitant, and Contingent Annuitant each must be age 85 or younger at the time the Contract is issued. For Option 2, the Owner, Annuitant, and Contingent Annuitant each must be age 80 or younger at the time the Contract is issued. For a full description of the circumstances under which we pay the Death Benefit, please see “Distribution of Death Benefit” on page 30 of this Prospectus.

If you have selected Death Benefit option 1, the amount of the Death Benefit will be the Annuity Account Value as of the date we receive a Request for the payout of the Death Benefit, minus any Premium Tax.

For Contracts issued on or after April 30, 2004, if you have selected Death Benefit option 2, the amount of the Death Benefit will be the greater of:

•

the Annuity Account Value as of the date we receive a Request for the payout of the Death Benefit, minus any Premium Tax; or

•

the sum of all Contributions, minus any Proportional Withdrawals and minus any Premium Tax.

For example, in a rising market, where an Owner contributed $100,000 which increased to $200,000 due to market appreciation and then withdrew $150,000, the new balance is $50,000 and the Proportional Withdrawal is 75% ($150,000/$200,000 = 75%). This 75% Proportional Withdrawal is calculated against the total Contribution amount of $100,000 for a Death Benefit equal to the greater of the Annuity Account Value ($50,000) or total Contributions reduced by 75% ($100,000 reduced by 75%, or $25,000). Here, the Death Benefit would be $50,000.

Separately, if the Owner withdrew $50,000, or 25% of the Annuity Account Value, for a new balance of $150,000, the Death Benefit remains the greater of the Annuity Account Value ($150,000) or total Contributions reduced by the Proportional Withdrawal calculation ($100,000 reduced by 25%, or $75,000). Here, the Death Benefit is $150,000.

If the Owner withdraws an additional $50,000, this represents an additional Proportional Withdrawal of 33% ($50,000/$150,000 = 33%). The Death Benefit is now equal to the greater of the Annuity Account Value ($100,000) or total Contributions reduced by all the Proportional Withdrawal calculations ($100,000 reduced by 75% and then reduced by 33%, or $16,750). Here, the Death Benefit is $100,000.

In a declining market, where an Owner contributed $100,000 which declined in value due to market losses to $50,000, and the Owner then withdrew $40,000, or 80% of Annuity Account Value, the result is a new account balance of $10,000. When applying Proportional Withdrawals, here 80%, the Death Benefit is the greater of the Annuity Account Value ($10,000) or total Contributions reduced by the Proportional Withdrawal calculation ($100,000 reduced by 80%, or $20,000). Here the death benefit is $20,000.

For Contracts issued prior to April 30, 2004, if you have selected Death Benefit Option 2, the amount of the Death Benefit will be the greater of:

•

the Annuity Account Value as of the date we receive a Request for the payout of the Death Benefit, minus any Premium Tax; or

•

the sum of Contributions applied to the Contract as of the date the request for payment is received, less partial withdrawals, periodic withdrawals, and premium tax, if any.

The difference between the two Death Benefit options we offer is that the amount payable upon death (the Death Benefit) is based on different criteria for each option and there is a different Mortality and Expense Risk Charge for each. Option 2 provides for the return of Contributions in the event that amount is greater than the Annuity Account Value (minus any Premium Tax and minus any partial withdrawals for Contracts issued before April 30, 2004 or minus any Proportional Withdrawals for Contracts issued thereafter). This could happen, for example, if the Death Benefit becomes payable soon after the Contract is purchased (say, one to three years) and, during those years, while Contributions are being made, the investment markets generally are in decline. Under these circumstances, it is possible that the performance of the Sub-Accounts you select

may cause the Annuity Account Value to be less than the total amount of Contributions. If you have selected Death Benefit option 2 on a Contract, your Beneficiary would receive the greater amount, in this case, the sum of all Contributions (minus any Premium Tax and minus any partial withdrawals for Contracts issued before April 30, 2004 or minus any Proportional Withdrawals for Contracts issued thereafter). If you have selected Death Benefit option 1, your Beneficiary would receive the lesser amount, in this case, the Annuity Account Value (minus any Premium Tax).

If you choose Death Benefit Option 1, your Mortality and Expense Risk Charge is 0.65% of the average daily value of the Sub-Accounts to which you have allocated Contributions. If you choose Death Benefit option 2 (under which we incur greater mortality risks), your Mortality and Expense Risk Charge will be 0.85%. For Contracts issued before May 1, 2003, if you chose Death Benefit option 2 (under which we incur greater mortality risks), your Mortality and Expense Risk Charge will be 0.70%.

The Death Benefit will become payable following our receipt of the Beneficiary’s claim in good order. When an Owner or the Annuitant dies before the Annuity Commencement Date and a Death Benefit is payable to a Beneficiary, the Death Benefit proceeds will remain invested according to the allocation instructions given by the Owner(s) until new allocation instructions are requested by the Beneficiary or until the Death Benefit is actually paid to the Beneficiary.

The amount of the Death Benefit will be determined as of the date we receive a Request for the payout of the Death Benefit. However, on the date a payout option is processed, the Annuity Account Value will be transferred to the Schwab Money Market Sub-Account unless the Beneficiary elects otherwise.

Subject to the distribution rules below, payout of the Death Benefit may be made as follows:

•	payout in a single sum, or

•	payout under any of the variable annuity options provided under this Contract.

In any event, no payout of benefits provided under the Contract will be allowed that does not satisfy the requirements of the Code and any other applicable federal or state laws, rules or regulations.

Beneficiary

You may select one or more Beneficiaries. If more than one Beneficiary is selected, they will share equally in any Death Benefit payable unless you indicate otherwise. You may change the Beneficiary any time before the Annuitant's death.

You may also select one or more Contingent Beneficiaries. You may change the Contingent Beneficiary before the Annuitant’s death. If one or more primary Beneficiaries are alive within 30 days after the Annuitant’s death, the Contingent Beneficiary cannot become the primary Beneficiary and any interest the Contingent Beneficiary may have in the Contract will cease.

A change of Beneficiary or Contingent Beneficiary will take effect as of the date the Request is processed, unless a certain date is specified by the Owner. If the Owner dies before the Request is processed, the change will take effect as of the date the Request was made, unless we have already made a payout or otherwise taken action on a designation or change before receipt or processing of such Request. A Beneficiary or Contingent Beneficiary designated irrevocably may not be changed without the written consent of that Beneficiary, or Contingent Beneficiary, as applicable, except as allowed by law.

The interest of any Beneficiary who dies before the Owner or the Annuitant will terminate at the death of the Beneficiary and the Contingent Beneficiary will become the Beneficiary. The interest of any Beneficiary who dies at the time of, or within 30 days after the death of an Owner or the Annuitant will also terminate if no benefits have been paid to such Beneficiary, unless the Owner otherwise indicates by Request. The benefits will then be paid to the Contingent Beneficiary. If no Contingent Beneficiary has been designated, then the benefits will be paid as though the Beneficiary had died before the deceased Owner or Annuitant. If no Beneficiary or Contingent Beneficiary survives the Owner or Annuitant, as applicable, we will pay the Death Benefit proceeds to the Owner's estate.

If the Beneficiary is not the Owner’s surviving spouse, she/he may elect, not later than one year after the Owner's date of death, to receive the Death Benefit in either a single sum or payout under any of the variable annuity options available under the Contract, provided that:

•	such annuity is distributed in substantially equal installments over the life or life expectancy of the Beneficiary or over a period not extending beyond the life expectancy of the Beneficiary and

•	such distributions begin not later than one year after the Owner's date of death.

If an election is not received by Great-West from a non-spouse Beneficiary or substantially equal installments begin later than one year after the Owner's date of death, then the entire amount must be distributed within five years of the Owner's date of death. The Death Benefit will be determined as of the date the payouts begin.

If a corporation or other non-individual entity is entitled to receive benefits upon the Owner's death, the Death Benefit must be completely distributed within five years of the Owner's date of death.

Distribution of Death Benefit

Death of Annuitant Who is Not the Owner

Upon the death of the Annuitant while the Owner is living, and before the Annuity Commencement Date, we will pay the Death Benefit to the Beneficiary unless there is a Contingent Annuitant.

If a Contingent Annuitant was named by the Owner prior to the Annuitant's death, and the Annuitant dies before the Annuity Commencement Date while the Owner and Contingent Annuitant are living, no Death Benefit will be payable and the Contingent Annuitant will become the Annuitant.

If the Annuitant dies after the date annuity payouts begin and before the entire interest has been distributed, any benefit payable must be distributed to the Beneficiary according to and as rapidly as under the payout option which was in effect on the Annuitant's date of death.

If a corporation or other non-individual is an Owner, the death of the Annuitant will be treated as the death of an Owner and the Contract will be subject to the "Death of Owner" provisions described below.

Contingent Annuitant

While the Annuitant is living, you may, by Request, designate or change a Contingent Annuitant from time to time. A change of Contingent Annuitant will take effect as of the date the request is processed, unless a certain date is specified by the Owner(s). Please note you are not required to designate a Contingent Annuitant.

Death of Owner Who Is Not the Annuitant

If the Owner dies before annuity payouts commence and there is a Joint Owner who is the surviving spouse of the deceased Owner, the Joint Owner becomes the Owner and Beneficiary and the Joint Owner may elect to take the Death Benefit or to continue the Contract in force.

If the Owner dies after annuity payouts commence and before the entire interest has been distributed while the Annuitant is living, any benefit payable will continue to be distributed to the Annuitant as rapidly as under the payout option applicable on the Owner's date of death. All rights granted the Owner under the Contract will pass to any surviving Joint Owner and, if none, to the Annuitant.

In all other cases, we will pay the Death Benefit to the Beneficiary even if a Joint Owner (who was not the Owner's spouse on the date of the Owner's death), the Annuitant and/or the Contingent Annuitant are alive at the time of the Owner's death, unless the sole Beneficiary is the deceased Owner's surviving spouse who may elect to become the Owner and Annuitant and to continue the Contract in force.

Death of Owner Who Is the Annuitant

If there is a Joint Owner who is the surviving spouse of the deceased Owner and a Contingent Annuitant, the Joint Owner becomes the Owner and the Beneficiary, the Contingent Annuitant will become the Annuitant, and the Contract will continue in force.

If there is a Joint Owner who is the surviving spouse of the deceased Owner but no Contingent Annuitant, the Joint Owner will become the Owner, Annuitant, and Beneficiary and may elect to take the Death Benefit or continue the Contract in force.

In all other cases, we will pay the Death Benefit to the Beneficiary, even if a Joint Owner (who was not the Owner's spouse on the date of the Owner's death) and/or Contingent Annuitant are alive at the time of the Owner's death, unless the sole Beneficiary is the deceased Owner's surviving spouse who may elect to become the Owner and Annuitant and to continue the Contract in force.

Charges and Deductions

No amounts will be deducted from your Contributions except for any applicable Premium Tax. As a result, the full amount of your Contributions (less any applicable Premium Tax) is invested in the Contract.

As more fully described below, charges under the Contract are assessed only as deductions for:

•	Premium Tax, if applicable; and/or

•	charges against your Annuity Account Value for our assumption of mortality and expense risks.

The Contract may be available for use with investment accounts at Schwab that charge an annual fee in lieu of sales charges or an investment advisory fee. Fees for these accounts would be specified in the respective account agreements. Any fees and expenses associated with these accounts will be separate from and in addition to the fees and expenses associated with the Contract. You should consult with your Financial Advisor for more details.

Mortality and Expense Risk Charge

We deduct a Mortality and Expense Risk Charge from your Annuity Account Value at the end of each valuation period to compensate us for bearing certain mortality and expense risks under the Contract. If you select Death Benefit option 1, this is a daily charge equal to an effective annual rate of 0.65%. We guarantee that this charge will never increase beyond 0.65%. If you select Death Benefit option 2, the Mortality and Expense Risk Charge is a daily charge equal to an effective annual rate of 0.85%. We guarantee that this charge will never increase beyond 0.85%. For Contracts issued prior to May 1, 2003, if you selected Death Benefit option 2, the Mortality and Expense Risk Charge is a daily charge equal to an effective annual rate of 0.70%.

The Mortality and Expense Risk Charge is reflected in the unit values of each of the Sub-Accounts you have selected. Thus, this charge will continue to be applicable should you choose a variable annuity payout option or a periodic withdrawal option.

Annuity Account Values and annuity payouts are not affected by changes in actual mortality experience incurred by us. The mortality risks assumed by us arise from our contractual obligations to make annuity payouts determined in accordance with the annuity tables and other provisions contained in the Contract. This means that you can be sure that neither the Annuitant's longevity nor an unanticipated improvement in general life expectancy will adversely affect the annuity payouts under the Contract.

The expense risk assumed is the risk that our actual expenses in administering the Contracts and the Series Account will be greater than we anticipated.

The Mortality and Expense Risk Charge is higher for Owners who have selected Death Benefit option 2 because we bear substantial risk in connection with that option. Specifically, we bear the risk that we may be required to pay an amount to your Beneficiary that is greater than your Annuity Account Value.

If the Mortality and Expense Risk Charge is insufficient to cover actual costs and risks assumed, the loss will fall on us. If this charge is more than sufficient, any excess will be profit to us. Currently, we expect a profit from this charge. Our expenses for distributing the Contracts will be borne by our general assets, including any profits from this charge.

Expenses of the Portfolios

The values of the assets in the Sub-Accounts reflects the values of the Sub-Accounts’ respective Portfolio shares and therefore the fees and expenses paid by each Portfolio.

Some of the Portfolios’ investment advisers or administrators may compensate us for providing administrative services in connection with the Portfolios or cost savings experienced by the investment advisers or administrators of the Portfolios. Such compensation is typically a percentage of the value of the assets invested in the relevant Sub-Accounts and generally may range up to 0.35% annually of net assets. GWFS Equities, Inc. (“GWFS”) is the principal underwriter and distributor of the Contracts and may also receive Rule 12b-1 fees (ranging up to 0.25% annually of net assets) directly from certain Portfolios for providing distribution related services related to shares of the Portfolios offered in connection with a Rule 12b-1 plan. If GWFS receives Rule 12b-1 fees, combined compensation for administrative and distribution related services generally ranges up to 0.60% annually of the assets invested in the relevant Sub-Accounts.

Premium Tax

We may be required to pay state Premium Taxes or retaliatory taxes currently ranging from 0% to 3.5% in connection with Contributions or values under the Contracts. Depending upon applicable state law, we may deduct charges for the Premium Taxes we incur with respect to your Contributions, from amounts withdrawn, or from amounts applied on the Payout

Commencement Date. In some states, charges for both direct Premium Taxes and retaliatory Premium Taxes may be imposed at the same or different times with respect to the same Contribution, depending on applicable state law.

Other Taxes

Under present laws, we will incur state or local taxes (in addition to the Premium Tax described above) in several states. No charges are currently deducted for taxes other than Premium Tax. However, we reserve the right to deduct charges in the future for federal, state, and local taxes or the economic burden resulting from the application of any tax laws that we determine to be attributable to the Contract.

Payout Options

During the Distribution Period, you can choose to receive payouts in three ways—through periodic withdrawals, variable annuity payouts or a single, lump-sum payment.

You may change the Payout Commencement Date within 30 days prior to commencement of payouts.

Periodic Withdrawals

You may request that all or part of the Annuity Account Value be applied to a periodic withdrawal option. All requests for periodic withdrawals must be in writing. The amount applied to a periodic withdrawal is the Annuity Account Value, less Premium Tax, if any.

In requesting periodic withdrawals, you must elect:

•	The withdrawal frequency of either 1-, 3-, 6- or 12-month intervals;

•	A minimum withdrawal amount of at least $100;

•	The calendar day of the month on which withdrawals will be made; and

•	One of the periodic withdrawal payout options discussed below— you may change the withdrawal option and/or the frequency once each calendar year.

Your withdrawals may be prorated across the Sub-Accounts in proportion to their assets. Or, they can be made from specific Sub-Account(s) until they are depleted. After that, we will automatically prorate the remaining withdrawals against any remaining Sub-Account assets unless you request otherwise.

While periodic withdrawals are being received:

•	You may continue to exercise all contractual rights, except that no Contributions may be made.

•	You may keep the same Sub-Accounts as you had selected before periodic withdrawals began.

•	Charges and fees under the Contract continue to apply.

Periodic withdrawals will cease on the earlier of the date:

•	The amount elected to be paid under the option selected has been reduced to zero.

•	The Annuity Account Value is zero.

•	You request that withdrawals stop.

•	You purchase an annuity payout option.

•	The Owner or the Annuitant dies.

If periodic withdrawals stop, you may resume making Contributions. However, we may limit the number of times you may restart a periodic withdrawal program.

Periodic withdrawals made for any purpose may be taxable, subject to withholding and to the 10% federal penalty tax if you are younger than age 59½.

If you choose to receive payouts from your Contract through periodic withdrawals, you may select from the following payout options:

Income for a specified period (at least 36 months)—You elect the length of time over which withdrawals will be made. The amount paid will vary based on the duration you choose.

Income of a specified amount (at least 36 months)—You elect the dollar amount of the withdrawals. Based on the amount elected, the duration may vary.

Any other form of periodic withdrawal acceptable to Great-West which is for a period of at least 36 months.

In accordance with the provisions outlined in this section, you may request a periodic withdrawal to remit fees paid to your Investment Manager or Financial Advisor. There may be income tax consequences to any periodic withdrawal made for this purpose. Please see “Cash Withdrawals” on page 27.

Annuity Payouts

You can choose the date that you wish annuity payouts to start either when you purchase the Contract or at a later date. If you do not select a payout start date, payouts will begin on the Annuitant's 91st birthday. You can change your selection at any time up to 30 days before the annuity date that you have selected.

If you have not elected a payout option within 30 days of the Annuity Commencement Date, your Annuity Account Value will be paid out as a variable life annuity with a guaranteed period of 20 years.

The amount to be paid out will be based on the Annuity Account Value, minus any Premium Tax, on the Annuity Commencement Date. The minimum amount that may be withdrawn from the Annuity Account Value to purchase an annuity payout option is $2,000. If your Annuity Account Value is less than $2,000, we may pay the amount in a single sum subject to the Contract provisions applicable to a partial withdrawal.

If you choose to receive variable annuity payouts from your Contract, you may select from the following payout options:

Variable life annuity with guaranteed period—This option provides for payouts during a guaranteed period or for the lifetime of the Annuitant, whichever is longer. The guaranteed period may be 5, 10, 15, or 20 years. Upon the death of the Annuitant, the Beneficiary will receive the remaining payouts at the same interval elected by the Owner.

Variable life annuity without guaranteed period—This option provides payouts during the lifetime of the Annuitant. The annuity terminates with the last payout due prior to the death of the Annuitant. Because no minimum number of payouts is guaranteed, this option may offer the maximum level of payouts. It is possible that only one payout may be made if the Annuitant dies before the date on which the second payout is due.

Under an annuity payout option, you can receive payouts monthly, quarterly, semi-annually or annually in payments which must be at least $50. We reserve the right to make payouts using the most frequent payout interval which produces a payout of at least $50. Once annuity payouts commence, you cannot make Contributions or take withdrawals, other than your annuity payouts.

If you elect to receive a single sum payment, the amount paid is the Surrender Value.

Amount of First Variable Payout

The first payout under a variable annuity payout option will be based on the value of the amounts held in each Sub-Account you have selected on the first valuation date preceding the Annuity Commencement Date. It will be determined by applying the appropriate rate to the amount applied under the payout option. The rate applied reflects an assumed investment return (“AIR”) of 5%.

For annuity options involving life income, the actual age, year in which annuitization commences and gender of the Annuitant will affect the amount of each payout. We reserve the right to ask for satisfactory proof of the Annuitant's age. We may delay annuity payouts until satisfactory proof is received. Because payouts to older Annuitants are expected to be fewer in number, the amount of each annuity payout under a selected annuity form will be greater for older Annuitants than for younger Annuitants.

If the age of the Annuitant has been misstated, the payouts established will be made on the basis of the correct age. If payouts were too large because of misstatement, the difference with interest may be deducted by us from the next payout or payouts. If payouts were too small, the difference with interest may be added by us to the next payout. This interest is at an annual effective rate which will not be less than the minimum rate allowed by law.

Variable Annuity Units

The number of Annuity Units paid for each Sub-Account is determined by dividing the amount of the first payout by its Annuity Unit value on the first valuation date preceding the Annuity Commencement Date. The number of Annuity Units used to calculate each payout for a Sub-Account remains fixed during the Annuity Payout Period.

Amount of Variable Payouts After the

First Payout

determined by multiplying (a) by (b) where (a) is the number of Sub-Account Annuity Units to be paid and (b) is the Sub-Account Annuity Unit value on the first valuation date preceding the date the annuity payout is due. The total amount of each

variable annuity payout will be the sum of the variable annuity payouts for each Sub-Account you have selected. We guarantee that the dollar amount of each payout after the first will not be affected by variations in expenses or mortality experience.

Transfers After the Variable Annuity

Commencement Date

Once annuity payouts have begun, Transfers may be made within the variable annuity payout option among the available Sub-Accounts. Transfers after the Annuity Commencement Date will be made by converting the number of Annuity Units being Transferred to the number of Annuity Units of the Sub-Account to which the Transfer is made. The result will be that the next annuity payout, if it were made at that time, would be the same amount that it would have been without the Transfer. Thereafter, annuity payouts will reflect changes in the value of the new Annuity Units.

Other Restrictions

Once payouts start under the annuity payout option you select:

•	no changes can be made in the payout option;

•	no additional Contributions will be accepted under the Contract; and

•	no further withdrawals, other than withdrawals made to provide annuity benefits, will be allowed.

A portion or the entire amount of the annuity payouts may be taxable as ordinary income. If, at the time the annuity payouts begin, we have not received a proper written election not to have federal income taxes withheld, we must by law withhold such taxes from the taxable portion of such annuity payouts and remit that amount to the federal government. State income tax withholding may also apply. Please see "Federal Tax Matters" below for details.

Seek Tax Advice

The following discussion of the federal income tax consequences is only a brief summary and is not intended as tax advice. The federal income tax consequences discussed here reflect our understanding of current law and the law may change. Federal estate tax consequences and state and local estate, inheritance, and other tax consequences of ownership or receipt of distributions under a Contract depend on your individual circumstances or the circumstances of the person who receives the distribution. A tax advisor should be consulted for further information.

Federal Tax Matters

The following discussion is a general description of federal income tax considerations relating to the Contract and is not intended as tax advice. This discussion assumes that the Contract qualifies as an annuity contract for federal income tax purposes. This discussion is not intended to address the tax consequences resulting from all situations. If you are concerned about the tax implications relating to the ownership or use of the Contract, you should consult a competent tax adviser before initiating any transaction.

This discussion is based upon our understanding of the present federal income tax laws as they are currently interpreted by the IRS. No representation is made as to the likelihood of the continuation of the present federal income tax laws or of the current interpretation by the IRS. Moreover, no attempt has been made to consider any applicable state or other tax laws.

The Contract may be purchased only on a non-tax qualified basis ("Non-Qualified Contract"). For federal income tax purposes, purchase payments made under Non-Qualified Contracts are not deductible. The ultimate effect of federal income taxes on the amounts held under a Contract, on annuity payouts, and on the economic benefit to you, the Annuitant, or the Beneficiary will depend on the tax status of the individual concerned.

Because tax laws, rules, and regulations are constantly changing, we do not make any guarantees about the Contract’s tax status.

Taxation of Annuities

Section 72 of the Code governs the taxation of annuities. An owner who is a “natural person” will not generally be taxed on increases, if any, in the value of the Annuity Account Value until a distribution of all or part of the Annuity Account Value is made (for example, withdrawals or annuity payouts under the annuity payout option elected). Also, if you make an assignment, pledge, or agreement to assign or pledge all or any portion of the Annuity Account Value, that amount will be treated as a distribution to you under the Contract. The taxable portion of a distribution (in the form of a single sum payout or an annuity) is taxable as ordinary income.

If the Owner of a Contract is a non-natural person (for example, a corporation, partnership, limited liability company or trust), the Owner must generally include in income any increase in the excess of the Annuity Account Value over the "investment in

the Contract" (discussed below) during each taxable year. The rule generally does not apply, however, where the non-natural person is only the nominal Owner of a Contract and the beneficial Owner is a natural person.

This rule also does not apply where:

•	The annuity Contract is acquired by the estate of a decedent.

•	The Contract is a qualified funding asset for a structured settlement.

•	The Contract is an immediate annuity.

The following discussion generally applies to a Contract owned by a natural person.

Withdrawals

Partial withdrawals, including periodic withdrawals that are not part of an annuity payout, are generally treated as taxable income to the extent that the Annuity Account Value immediately before the withdrawal exceeds the "investment in the Contract" at that time. Full surrenders are treated as taxable income to the extent that the amount received exceeds the "investment in the Contract.” The taxable portion of any withdrawal is taxed at ordinary income tax rates.

Annuity Payouts

Although the tax consequences will vary depending on the annuity form elected under the Contract, in general, only the portion of the annuity payout that exceeds the exclusion amount will be taxed. The exclusion amount is generally determined by a formula that establishes the ratio of the “investment in the Contract” to the expected return under the Contract. For fixed annuity payouts, in general there is no tax on the portion of each payout which represents the same ratio that the “investment in the Contract” allocated to the fixed annuity payouts bears to the total expected value of the annuity payouts for the term of the payouts (determined under Treasury Department regulations). For variable annuity payouts, in general there is no tax on the portion of each payout which represents the same ratio that the “investment in the Contract” allocated to the variable annuity payouts bears to the number of payouts expected to be made (determined by Treasury Department regulations which take into account the Annuitant’s life expectancy and the form of annuity benefits selected). However, the remainder of each annuity payout is taxable. Once the “investment in the Contract” has been fully recovered, the full amount of any additional annuity payouts is taxable. If the annuity payments stop as a result of an Annuitant’s death before full recovery of the “investment in the Contract,” you should consult a competent tax adviser regarding the deductibility of the uncovered amount.

The taxable portion of any annuity payout is taxed at ordinary income tax rates.

Penalty Tax

There may be a federal income tax penalty imposed equal to 10% of the amount treated as taxable income. In general, however, there is no penalty tax on distributions:

•	Made on or after the date on which the Owner reaches age 59½.

•	Made as a result of death or disability of the Owner.

•	Received in substantially equal periodic payouts (at least annually) for your life (or life expectancy) or the joint lives (or joint life expectancies) of you and the Beneficiary.

For more details regarding this penalty tax and other exemptions that may be applicable, consult a competent tax adviser.

Taxation of Death Benefit Proceeds

Amounts may be distributed from the Contract because of the death of an Owner or the Annuitant. Generally such amounts are included in the income of the recipient as follows:

•	If distributed in a lump sum, they are taxed in the same manner as a full withdrawal, as described above.

•	If distributed under an annuity form, they are taxed in the same manner as annuity payouts, as described above.

Distribution at Death

In order to be treated as an annuity contract, the terms of the Contract must provide the following two distribution rules:

•

If the Owner dies before the date annuity payouts start, the entire Annuity Account Value must generally be distributed within five years after the date of death. If payable to a designated Beneficiary, the distributions may be paid over the life of that designated Beneficiary or over a period not extending beyond the life expectancy of that Beneficiary, so long as payouts start within one year of the Owner's death. If the sole designated Beneficiary is the Owner's spouse, the Contract may be continued in the name of the spouse as Owner.

•	If the Owner dies on or after the date annuity payouts start, and before the entire interest in the Contract has been distributed, payments under the Contract must continue on the same or on a more rapid schedule than that provided for in the method in effect on the date of death.

If the Owner is not an individual, then for purposes of the distribution at death rules, the Primary Annuitant is considered the Owner. In addition, when the Owner is not an individual, a change in the Primary Annuitant is treated as the death of the Owner. The rules described under Distribution of Death Benefit are designed to meet these requirements.

Diversification of Investments

For a Non-Qualified Contract to be treated as an annuity for federal income tax purposes, the investments of the Sub-Accounts must be "adequately diversified" in accordance with Treasury Department Regulations. If the Series Account or a Sub-Account failed to comply with these diversification standards, a Non-Qualified Contract would not be treated as an annuity contract for federal income tax purposes and the Owner would generally be taxable currently on the excess of the Annuity Account Value over the “investment in the Contract.”

Although we may not control the investments of the Sub-Accounts or the Portfolios, we expect that the Sub-Accounts and the Portfolios will comply with such regulations so that the Sub-accounts will be considered "adequately diversified.” Owners bear the risk that the entire Non-Qualified Contract could be disqualified as an annuity under the Code due to the failure of the Series Account or a Sub-Account to be deemed to be adequately diversified.

Owner Control

In connection with its issuance of temporary and proposed regulations under Section 817(h) in 1986, the Treasury Department announced that those regulations did not "provide guidance concerning the circumstances in which investor control of the investments of a segregated asset account may cause the investor (i.e., the Owner), rather than the insurance company to be treated as the owner of the assets in the account" (which would result in the current taxation of the income on those assets to the Owner). In Revenue Ruling 2003-91, the IRS provided such guidance by describing the circumstances under which the owner of a variable contract will not possess sufficient control over the assets underlying the contract to be treated as the owner of those assets for federal income tax purposes. Rev. Rul. 2003-91 states that the determination of whether the owner of a variable contract is to be treated as the owner of the assets held by the insurance company under the contract will depend on all of the facts and circumstances. We do not believe that the ownership rights of an Owner under the Contract would result in any Owner being treated as the owner of the assets of the Contract under Rev. Rul. 2003-91. However, we do not know whether additional guidance will be provided by the IRS on this issue and what standards may be contained in such guidance. Therefore, we reserve the right to modify the Contract as necessary to attempt to prevent a Contract Owner from being considered the owner of a pro rata share of the assets of the Contract.

Transfers, Assignments or Exchanges

A transfer of ownership of a Contract, the designation of an Annuitant, Payee, or other Beneficiary who is not also the Owner, or the exchange of a Contract may result in adverse tax consequences that are not discussed in this Prospectus.

Multiple Contracts

All deferred, Non-Qualified Annuity Contracts that are issued by Great-West (or our affiliates) to the same Owner during any calendar year must be treated as a single annuity contract for purposes of determining the taxable amount.

Withholding

Distributions generally are subject to withholding at rates that vary according to the type of distribution and the recipient's tax status. Recipients, however, generally are provided the opportunity to elect not to have tax withheld from distributions.

Section 1035 Exchanges

Code Section 1035 provides that no gain or loss shall be recognized on the exchange of one annuity contract for another. Generally, an annuity contract issued in an exchange for another annuity contract is treated as new for purposes of the penalty and distribution at death rules.

If the initial Contribution is made as a result of an exchange or surrender of another annuity contract, we may require that you provide information relating to the federal income tax status of the previous annuity contract to us.

Assignments or Pledges

Generally, rights in the Contract may be assigned or pledged as collateral for loans at any time during the life of the Annuitant.

If the Contract is assigned, the interest of the assignee has priority over your interest and the interest of the Beneficiary. Any amount payable to the assignee will be paid in a single sum.

A copy of any assignment must be submitted to Great-West. All assignments are subject to any action taken or payout made by Great-West before the assignment was processed. We are not responsible for the validity or sufficiency of any assignment.

If any portion of the Annuity Account Value is assigned or pledged as collateral for a loan, it may be treated as a distribution. Please consult a competent tax advisor for further information.

Distribution of the Contracts

We offer the Contract on a continuous basis. We have entered into a distribution agreement with Charles Schwab & Co., Inc. (“Schwab”) and GWFS. Contracts are sold in those states where the Contract may lawfully be sold by licensed insurance agents who are registered representatives of Schwab. Schwab is registered as a broker/dealer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and is a member of FINRA. Schwab’s principal offices are located at 101 Montgomery Street, San Francisco, California 94104.

GWFS is the principal underwriter and distributor of the Contracts and is a wholly-owned subsidiary of Great-West. GWFS is registered with the SEC as a broker/dealer and is a member of FINRA. Its principal offices are located at 8525 East Orchard Road, Greenwood Village, Colorado, 80111.

Great-West (or its affiliates, for purposes of this section only, collectively, "the Company") pays Schwab compensation for the promotion and sale of the Contract. Compensation paid to Schwab is not paid directly by the Owner or the Series Account. The Company intends to fund this compensation through fees and charges imposed under the Contract and payable to the Company, and from profits on payments received by the Company from Portfolios’ advisers or administrators for providing administrative, marketing, and other support and services to the Portfolios. See “Expenses of the Portfolios” on page 31 of this Prospectus. The Company pays a portion of these proceeds to Schwab for distribution services.

As compensation for distribution services and some Contract administrative services, the Company pays Schwab a fee based on an annual rate of average monthly Series Account and Fixed Account assets. The Company also may pay a marketing allowance or allow other promotional incentives or payments to Schwab in the form of cash or other compensation, as mutually agreed upon by the Company and Schwab, to the extent permitted by FINRA rules and other applicable laws and regulations. In the past, the portion of compensation relating to a marketing allowance and/or other promotional incentives or payments to Schwab has amounted to less than $25,000 per year.

You should ask your Schwab representative for further information about what compensation he or she, or Schwab, may receive in connection with your purchase of a Contract.

Voting Rights

In general, you do not have a direct right to vote the Portfolio shares held in the Series Account. However, under current law, you are entitled to give us instructions on how to vote the shares. We will vote the shares according to those instructions at regular and special shareholder meetings. If the law changes and we can vote the shares in our own right, we may elect to do so.

Before the Annuity Commencement Date, you have the voting interest. The number of votes available to you will be calculated separately for each of your Sub-Accounts. That number will be determined by applying your percentage interest, if any, in a particular Sub-Account to the total number of votes attributable to that Sub-Account. You hold a voting interest in each Sub-Account to which your Annuity Account Value is allocated. If you select a variable annuity option, the votes attributable to your Contract will decrease as annuity payouts are made.

The number of votes of a Portfolio will be determined as of the date established by that Portfolio for determining shareholders eligible to vote at the meeting of the Portfolio. Voting instructions will be solicited by communication prior to such meeting in accordance with procedures established by the respective Portfolios.

If we do not receive timely instructions and Owners have no beneficial interest in shares held by us, we will vote according to the voting instructions as a proportion of all Contracts participating in the Sub-Account. If you indicate in your instructions that you do not wish to vote an item, we will apply your instructions on a pro rata basis to reduce the votes eligible to be cast.

Each person or entity having a voting interest in a Sub-Account will receive proxy material, reports, and other material relating to the appropriate Portfolio.

Please note, generally the Portfolios are not required to, and do not intend to, hold annual or other regular meetings of shareholders.

Contract Owners have no voting rights in Great-West.

Rights Reserved by Great-West

We reserve the right to make certain changes we believe would best serve the interests of Owners and Annuitants or would be appropriate in carrying out the purposes of the Contract. Any changes will be made only to the extent and in the manner permitted by applicable laws. Also, when required by law, we will obtain your approval of the changes and approval from any appropriate regulatory authority. Approval may not be required in all cases, however. Examples of the changes we may make include:

•	To operate the Series Account in any form permitted under the 1940 Act or in any other form permitted by law.

• To Transfer any assets in any Sub-Account to another Sub-Account, or to one or more separate accounts; or to add, combine or remove Sub-Accounts of the Series Account.

•	To substitute, for the Portfolio shares in any Sub-Account, the shares of another Portfolio or shares of another investment company or any other investment permitted by law.

•	To make any changes required by the Code or by any other applicable law in order to continue treatment of the Contract as an annuity.

•	To change the time or time of day that a valuation date is deemed to have ended.

•	To make any other necessary technical changes in the Contract in order to conform with any action the above provisions permit us to take, including changing the way we assess charges, without increasing them for any outstanding Contract beyond the aggregate amount guaranteed.

Legal Proceedings

Currently, the Series Account is not a party to, and its assets are not subject to any material legal proceedings. Further, Great-West is not currently a party to, and its property is not currently subject to, any material legal proceedings. The lawsuits to which Great-West is a party are, in the opinion of management, in the ordinary course of business, and are not expected to have a material adverse effect on the financial results, conditions, or prospects of Great-West.

Legal Matters

Advice regarding certain legal matters concerning the federal securities laws applicable to the issue and sale of the Contract has been provided by Jorden Burt LLP.

Independent Registered Public Accounting Firm

The financial statements of each of the investment divisions of the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company and the financial statements of Great-West Life & Annuity Insurance Company included in the Statement of Additional Information and the related financial statement schedule included elsewhere in the Registration Statement have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports appearing herein and elsewhere in the Registration Statement which reports express an unqualified opinion on the financial statements of the investment divisions of the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company and the consolidated financial statements and financial statement schedule of Great-West Life & Annuity Insurance Company and includes an explanatory paragraph referring to the change in method of accounting for income taxes, as required by accounting guidance adopted on January 1, 2007, and change in method of accounting for defined benefit and other post retirement plans and share based payments as required by accounting guidance which was adopted on December 31, 2006, and January 1, 2006, respectively, and have been so included in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.

Available Information

You may request a free copy of the SAI. Please direct any oral, written, or electronic request for such documents to:

Schwab Insurance Services

P.O. Box 7666

San Francisco, California 94120-9639

1-800-838-0650

Internet: www.schwab.com/annuity

The SEC maintains an Internet web site (http://www.sec.gov) that contains the SAI and other information filed electronically by Great-West concerning the Contract and the Series Account.

You also can review and copy any materials filed with the SEC at its Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference room by calling the SEC at 1-800-SEC-0330.

The SAI contains more specific information relating to the Series Account and Great-West, such as:

•	general information;

•	information about Great-West Life & Annuity Insurance Company and the Variable Annuity-1 Series Account;

•	the calculation of annuity payouts;

•	postponement of payouts;

•

services;

•	withholding; and

•	financial statements.

APPENDIX A—Condensed Financial Information - Selected Data for Accumulation Units

Outstanding Through Each Period for the Periods Ended December 31, 2007

Portfolio (0.65)

2007

2006

2005

2004

2003

2002

2001

AIM V.I. High Yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.60

12.67

29,514

11.45

12.60

44,456

11.22

11.45

64,746

10.19

11.22

195,459

8.20

10.19

211,687

8.34

8.20

155,933

10.00

8.34

60,110

AIM V.I. INTERNATIONAL GROWTH

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.11

12.67

358,055

10.00

11.11

90,866

AIM V.I. Technology

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

6.35

6.80

37,683

5.79

6.35

46,119

5.70

5.79

136,780

5.48

5.70

92,750

3.81

5.48

87,469

7.19

3.81

50,271

10.00

7.19

35,530

Alger American Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.64

13.00

67,736

11.19

11.64

83,844

10.39

11.19

99,107

10.00

10.39

110,809

8.45

10.00

109,440

9.70

8.45

53,444

10.00

9.70

10,478

Alger American Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.69

11.55

604,526

9.28

9.69

254,412

8.34

9.28

240,350

7.95

8.34

191,268

5.92

7.95

198,997

8.90

5.92

147,192

10.00

8.90

110,022

Alger American MidCap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.11

21.06

267,747

14.72

16.11

142,638

13.49

14.72

133,009

12.01

13.49

89,777

10.00

12.01

64,304

AllianceBERNSTEIN VPS Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.87

13.44

575,180

11.04

12.87

521,544

10.60

11.04

546,779

9.57

10.60

480,706

7.27

9.57

326,171

9.39

7.27

240,038

10.00

9.39

98,944

AllianceBERNSTEIN VPS Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.25

11.51

163,565

10.43

10.25

145,165

9.38

10.43

144,178

8.23

9.38

98,192

6.13

8.23

45,080

8.58

6.13

8,011

10.00

8.58

3,673

AllianceBERNSTEIN VPS International Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.41

18.08

1,106,315

12.21

15.41

753,304

10.00

12.21

284,652

AllianceBernstein VPS INTERNATIONAL VALUE

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.29

11.87

985,118

10.00

11.29

536,762

AllianceBernstein VPS Real Estate Investment

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

31.21

26.60

303,381

23.31

31.32

380,707

21.01

23.31

340,144

15.59

21.01

352,239

11.27

15.59

232,851

11.05

11.27

218,785

10.00

11.05

48,102

AllianceBernstein VPS sMALL/MIDCAP VALUE

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.48

10.59

127,516

10.00

10.48

74,541

AllianceBernstein VPS Utility Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

22.27

27.07

153,186

18.11

22.27

132,645

15.71

18.11

115,031

12.72

15.71

87,579

10.68

12.72

17,023

10.00

10.68

360

American Century VP Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.31

13.87

279,804

12.22

13.31

130,725

11.72

12.22

142,758

10.75

11.72

69,291

10.00

10.75

18,397

American Century VP Income & Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.08

12.99

297,967

11.25

13.08

324,260

10.82

11.25

356,076

9.64

10.82

243,033

7.50

9.64

108,794

9.36

7.50

35,723

10.00

9.36

3,158

Portfolio (0.65)

2007

2006

2005

2004

2003

2002

2001

American Century VP International

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.92

15.16

244,293

10.40

12.92

309,359

9.25

10.40

454,100

8.10

9.25

245,812

6.55

8.10

189,050

8.27

6.55

111,688

10.00

8.27

76,030

American Century VP Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.09

15.17

561,777

13.65

16.09

457,477

13.08

13.65

304,382

11.52

13.08

144,996

10.00

11.52

27,978

lvip Baron growth opportunities

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

17.20

17.67

369,577

14.99

17.20

292,654

14.59

14.99

262,841

11.69

14.59

182,068

10.00

11.69

17,381

Delaware VIP GROWTH OPPORTUNITIES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.70

14.25

32,435

12.02

12.70

21,480

10.00

12.02

1,520

Delaware VIP Small Cap Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

21.43

19.88

505,999

18.57

21.43

536,386

17.08

18.57

502,117

14.15

17.08

394,682

10.03

14.15

249,520

10.71

10.03

173,852

10.00

10.71

58,778

NVIT Mid Cap Index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.55

17.66

322,355

15.18

16.55

278,447

13.66

15.18

258,942

11.90

13.66

160,964

10.00

11.90

51,182

Dreyfus IP MidCap Stock

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.38

15.51

77,463

14.37

15.38

67,381

13.24

14.37

66,741

11.64

13.24

27,877

10.00

11.64

12,740

dreyfus vif appreciation

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.31

13.11

72,993

10.64

12.31

50,967

10.26

10.64

12,987

10.00

10.26

1,164

Dreyfus VIF Developing Leaders

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.34

10.90

53,185

11.97

12.34

59,823

11.39

11.97

74,812

10.29

11.39

95,104

7.87

10.29

103,251

9.79

7.87

99,056

10.00

9.79

46,287

Dreyfus VIF Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.86

11.70

63,319

9.54

10.86

89,397

9.29

9.54

95,759

8.70

9.29

67,786

6.92

8.70

68,659

9.33

6.92

49,093

10.00

9.33

10,283

DWS bLUE CHIP VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.89

13.25

355,527

11.22

12.89

230,375

10.00

11.22

5,353

DWS Capital Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.72

10.87

158,110

9.01

9.72

127,485

8.32

9.01

95,364

7.76

8.32

71,284

6.15

7.76

51,873

8.75

6.15

28,641

10.00

8.75

13,756

DWS DREMAN HIGH RETURN EQUITY VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.74

12.43

438,186

10.80

12.74

377,407

10.00

10.80

47,366

DWS dreman Small MID Cap value vip

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.61

10.86

212,566

10.00

10.61

129,998

DWS HEALTH CARE VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.71

12.05

130,954

10.00

10.71

46,559

portfolio (0.65)

2007

2006

2005

2004

2003

2002

2001

DWS LARGE CAP VALUE VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.02

13.51

123,301

10.48

12.02

34,057

10.00

10.48

8,634

DWS Small Cap Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.19

9.69

38,655

8.78

9.19

47,398

8.26

8.78

72,322

7.49

8.26

49,295

5.67

7.49

49,656

8.57

5.67

16,037

10.00

8.57

12,369

DWS Small Cap Index VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.42

16.00

316,371

14.06

16.42

251,429

13.57

14.06

203,820

11.60

13.57

198,752

7.98

11.60

144,944

10.11

7.98

82,187

10.00

10.11

36,498

Federated Fund For U.S. Government Securities II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.73

12.39

920,253

11.34

11.73

821,502

11.19

11.34

668,822

10.87

11.19

497,189

10.69

10.87

412,149

10.00

10.69

396,638

Federated International Equity II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.47

12.49

74,232

9.71

11.47

111,713

8.96

9.71

112,499

7.91

8.96

121,960

6.03

7.91

69,817

7.86

6.03

14,363

10.00

7.86

FRANKLIN SMALL CAP VALUE SECURITIES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.20

9.89

46,600

10.00

10.20

17,025

JANUS ASPEN BALANCED INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.38

14.70

457,592

12.17

13.38

410,633

11.34

12.17

118,970

10.52

11.34

43,902

10.00

10.52

4,320

JANUS ASPEN BALANCED SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.43

462,895

Janus Aspen Flexible bond INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.09

13.92

577,297

12.64

13.09

610,869

12.48

12.64

598,874

12.08

12.48

426,085

11.43

12.08

393,593

10.41

11.43

466,619

10.00

10.41

229,005

Janus Aspen Flexible bond SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.43

449,917

janus Aspen Growth & income INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.24

9.99

723,753

8.61

9.24

938,104

7.72

8.61

501,067

6.94

7.72

119,647

5.53

6.94

42,844

8.38

5.53

23,980

10.00

8.38

14,808

janus Aspen Growth & income SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.23

285,568

Janus Aspen Worldwide Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.93

10.81

50,735

8.45

9.93

95,133

8.04

8.45

99,045

7.72

8.04

105,638

6.27

7.72

175,709

8.47

6.27

120,211

10.00

8.47

99,987

JPMorgan Small Company

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.28

14.32

76,599

13.37

15.28

116,376

13.01

13.37

110,664

10.30

13.01

121,181

7.62

10.30

158,324

9.79

7.62

75,297

10.00

9.79

73,404

neuberger berman amt regency

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.22

10.47

43,755

10.00

10.22

26,542

OLD MUTUAL Large Cap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.12

10.83

66,188

8.69

9.12

78,077

8.37

8.69

122,518

7.73

8.37

124,879

5.93

7.73

76,534

8.45

5.93

41,765

10.00

8.45

29,271

Oppenheimer Global Securities VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.38

17.30

899,043

14.01

16.38

814,352

12.34

14.01

721,098

10.42

12.34

456,727

7.33

10.42

207,129

9.48

7.33

101,358

10.00

9.48

28,571

Portfolio (0.65)

2007

2006

2005

2004

2003

2002

2001

Oppenheimer INTERNATIONAL GROWTH VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.34

17.16

518,247

11.80

15.34

380,588

10.00

11.80

104,291

PIMCO VIT high yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.16

16.63

791,747

14.92

16.16

543,303

14.42

14.92

364,562

13.25

14.42

313,009

10.85

13.25

235,769

10.00

10.85

18,423

PIMCO VIT Low Duration

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.41

11.11

1,774,132

10.08

10.41

1,403,417

10.04

10.08

1,225,999

9.93

10.04

757,116

10.00

9.93

287,572

PIMCO VIT TOTAL RETURN

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.39

11.23

3,213,388

10.08

10.39

2,268,757

10.00

10.08

300,771

pioneer fund VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.27

11.76

135,937

9.73

11.27

74,298

9.22

9.73

63,128

8.62

9.22

29,900

6.95

8.62

20,595

9.45

6.95

4,202

10.00

9.45

429

PIONEER GROWTH OPPORTUNITIES VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.75

9.31

25,830

10.00

9.75

24,255

pioneer MID CAP VALUE VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.64

11.14

74,959

10.00

10.64

11,428

pioneer Small CAP Value VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.87

17.45

166,963

16.92

18.87

199,972

14.82

16.92

172,982

12.19

14.82

163,561

10.00

12.19

19,606

Schwab MarketTrack Growth II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.35

14.02

828,014

11.69

13.35

553,378

11.12

11.69

285,063

10.03

11.12

213,302

7.95

10.03

169,578

9.47

7.95

89,844

10.00

9.47

64,405

Schwab Money Market

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.88

11.32

6,276,882

10.47

10.88

4,276,333

10.25

10.47

2,708,383

10.23

10.25

2,130,238

10.22

10.23

2,208,675

10.15

10.22

3,373,801

10.00

10.15

1,500,043

Schwab S&P 500 index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.89

12.44

3,348,543

10.35

11.89

2,814,209

9.95

10.35

2,315,440

9.06

9.95

2,177,686

7.11

9.06

1,389,111

9.23

7.11

769,309

10.00

9.23

428,098

SELIGMAN COMMUNICATIONS & INFORMATION

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.62

12.15

112,501

10.00

10.62

50,082

third avenue value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.33

9.77

867,622

10.00

10.33

453,625

VAN KAMPEN LIT COMSTOCK

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.27

11.95

117,816

10.62

12.27

107,806

10.00

10.62

19,969

VAN KAMPEN LIT GROWTH & INCOME

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.74

13.01

357,681

11.03

12.74

266,330

10.00

11.03

49,549

Portfolio (0.65)

2007

2006

2005

2004

2003

2002

2001

WELLS FARGO ADVANTAGE vt DISCOVERY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.76

11.86

240,879

8.57

9.76

142,197

7.87

8.57

103,024

6.65

7.87

87,046

4.98

6.65

92,408

8.03

4.98

77,343

10.00

8.03

27,603

WELLS FARGO ADVANTAGE vt OPPORTUNITY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.20

13.99

150,979

11.84

13.20

126,802

11.05

11.84

140,863

9.41

11.05

153,430

6.91

9.41

174,504

9.50

6.91

167,207

10.00

9.50

113,694

Portfolio (0.70)

2007

2006

2005

2004

2003

2002

2001

AIM V.I. INTERNATIONAL GROWTH

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.11

12.66

37,408

10.00

11.11

51,223

AIM V.I. High Yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.56

12.63

23,264

11.43

12.56

28,326

11.20

11.43

57,847

10.17

11.20

74,732

8.19

10.17

96,851

8.36

8.19

61,147

10.00

8.36

35,883

AIM V.I. Technology

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

6.34

6.78

43,714

5.78

6.34

59,520

5.69

5.78

72,161

5.48

5.69

126,127

3.79

5.48

130,598

7.19

3.79

17,597

10.00

7.19

8,092

Alger American Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.61

12.95

83,851

11.16

11.61

100,959

10.37

11.16

207,288

9.98

10.37

269,868

8.45

9.98

307,918

9.70

8.45

169,538

10.00

9.70

44,719

Alger American Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.67

11.51

208,329

9.26

9.67

194,217

8.32

9.26

219,926

7.94

8.32

252,765

5.92

7.94

263,150

8.89

5.92

137,994

10.00

8.89

53,244

Alger American MidCap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.08

21.01

77,107

14.71

16.08

64,232

13.48

14.71

63,719

12.01

13.48

56,300

10.00

12.01

70,403

AllianceBERNSTEIN VPs Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.83

13.39

311,858

11.02

12.83

331,146

10.58

11.02

407,125

9.56

10.58

484,141

7.26

9.56

439,663

9.38

7.26

215,640

10.00

9.38

74,454

AllianceBERNSTEIN VPs Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.22

11.47

124,518

10.40

10.22

113,566

9.36

10.40

140,601

8.21

9.36

127,537

6.12

8.21

71,698

8.58

6.12

33,931

10.00

8.58

11,322

AllianceBERNSTEIN VPS International Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.39

18.06

193,982

12.20

15.39

164,349

10.00

12.20

104,810

AllianceBERNSTEIN VPS International VALUE

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.29

11.86

162,291

10.00

11.29

141,998

AllianceBernstein VPS Real Estate Investment

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

31.23

26.51

92,149

23.26

31.23

168,132

20.97

23.26

179,859

15.57

20.97

215,232

11.26

15.57

244,925

11.05

11.26

111,891

10.00

11.05

16,327

AllianceBernstein vps SMALL/MIDCAP VALUE

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.48

10.58

27,361

10.00

10.48

23,137

AllianceBernstein VPS Utility Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

22.23

27.01

68,688

18.09

22.23

76,926

15.70

18.09

70,047

12.71

15.70

52,056

10.68

12.71

35,164

10.00

10.68

5,853

Portfolio (0.70)

2007

2006

2005

2004

2003

2002

2001

American Century VP Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.28

13.84

37,751

12.20

13.28

38,504

11.71

12.20

59,183

10.74

11.71

36,909

10.00

10.74

17,320

American Century VP Income & Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.04

12.95

74,358

11.22

13.04

85,597

10.80

11.22

103,139

9.62

10.80

135,993

7.49

9.62

140,734

9.36

7.49

46,045

10.00

9.36

5,696

American Century VP International

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.88

15.11

148,770

10.38

12.88

180,737

9.23

10.38

231,955

8.09

9.23

209,195

6.54

8.09

191,289

8.27

6.54

84,012

10.00

8.27

27,288

American Century VP Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.07

15.13

106,549

13.64

16.07

105,848

13.07

13.64

94,288

11.51

13.07

79,721

10.00

11.51

73,547

lvip Baron growth opportunities

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

17.17

17.64

76,720

14.97

17.17

58,943

14.58

14.97

75,222

11.69

14.58

88,845

10.00

11.69

20,363

Delaware VIP GROWTH OPPORTUNITIES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.69

14.23

2,268

12.02

12.69

1,011

10.00

12.02

1,401

Delaware VIP Small Cap Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

21.37

19.82

228,361

18.53

21.37

342,600

17.05

18.53

385,943

14.13

17.05

444,074

10.02

14.13

470,103

10.70

10.02

247,190

10.00

10.70

28,758

nVIT Mid Cap index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.53

17.62

45,361

15.17

16.53

49,308

13.65

15.17

70,632

11.90

13.65

56,042

10.00

11.90

27,260

Dreyfus IP MidCap Stock

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.35

15.47

28,840

14.35

15.35

30,338

13.23

14.35

43,054

11.64

13.23

34,564

10.00

11.64

8,868

Dreyfus VIF APPRECIATION

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.30

13.09

14,505

10.63

12.30

7,914

10.26

10.63

262

10.00

10.26

-----

Dreyfus VIF Developing Leaders

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.28

10.85

41,470

11.92

12.28

58,911

11.34

11.92

85,467

10.26

11.34

106,621

7.85

10.26

118,045

9.77

7.85

91,862

10.00

9.77

33,176

Dreyfus VIF Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.83

11.66

43,439

9.52

10.83

44,891

9.28

9.52

49,137

8.69

9.28

74,215

6.92

8.69

69,730

9.33

6.92

52,219

10.00

9.33

19,175

DWS bLUE CHIP VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.88

13.23

22,283

11.21

12.88

12,653

10.00

11.21

2,796

DWS Capital Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.69

10.83

47,863

8.99

9.69

45,796

8.31

8.99

64,108

7.75

8.31

71,626

6.15

7.75

51,458

8.74

6.15

30,590

10.00

8.74

7,975

Portfolio (0.70)

2007

2006

2005

2004

2003

2002

2001

DWS DREMAN HIGH RETURN EQUITY VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.73

12.41

29,873

10.80

12.73

40,224

10.00

10.80

13,263

DWS DREMAN small MID cap value VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.61

10.85

9,840

10.00

10.61

10,825

DWS HEALTH CARE VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.71

12.04

17,785

10.00

10.71

4,275

DWS LARGE CAP VALUE VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.01

13.49

36,878

10.48

12.01

31,756

10.00

10.48

43,396

DWS Small Cap Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.16

9.66

39,935

8.76

9.16

62,794

8.24

8.76

119,327

7.47

8.24

138,251

5.66

7.47

151,738

8.57

5.66

33,680

10.00

8.57

6,754

DWS Small Cap Index VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.37

15.94

100,858

14.03

16.37

117,123

13.55

14.03

166,915

11.59

13.55

219,967

7.97

11.59

230,948

10.11

7.97

100,826

10.00

10.11

41,813

Federated Fund For U.S. Government Securities II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.71

12.35

470,898

11.32

11.71

550,162

11.17

11.32

717,207

10.86

11.17

785,115

10.68

10.86

980,160

10.00

10.68

876,353

Federated International Equity II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.44

12.44

23,814

9.70

11.44

38,941

8.95

9.70

69,026

7.91

8.95

103,509

6.03

7.91

67,829

7.86

6.03

30,044

10.00

7.86

1,778

FRANKLIN SMALL CAP VALUE SECURITIES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.20

9.88

2,052

10.00

10.20

2,052

JANUS ASPEN BALANCED INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.36

14.67

105,621

12.15

13.36

123,056

11.34

12.15

97,347

10.52

11.34

50,893

10.00

10.52

13,603

JANUS ASPEN BALANCED SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.43

16,752

Janus Aspen Flexible bond INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.05

13.87

459,676

12.61

13.05

546,980

12.45

12.61

664,139

12.06

12.45

776,977

11.42

12.06

875,374

10.41

11.42

645,422

10.00

10.41

276,547

Janus Aspen Flexible bond SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.43

34,941

janus Aspen Growth & income INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.23

9.96

204,627

8.60

9.23

249,561

7.71

8.60

275,819

6.93

7.71

169,398

5.53

6.93

74,803

8.39

5.53

18,670

10.00

8.39

8,729

janus Aspen Growth & income SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.22

31,613

Janus Aspen Worldwide Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.90

10.77

26,966

8.43

9.90

27,627

8.02

8.43

52,221

7.71

8.02

99,865

6.26

7.71

127,448

8.46

6.26

151,128

10.00

8.46

60,207

JPMorgan Small Company

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.23

14.27

35,350

13.34

15.23

39,502

12.99

13.34

58,343

10.28

12.99

90,110

7.62

10.28

233,971

9.79

7.62

93,967

10.00

9.79

64,994

Portfolio (0.70)

2007

2006

2005

2004

2003

2002

2001

NEUBERGER BERMAN AMT REGENCY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.22

10.46

7,294

10.00

10.22

9,345

Oppenheimer Global Securities VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.34

17.25

341,251

13.98

16.34

397,451

12.31

13.98

453,951

10.41

12.31

430,326

7.33

10.41

424,864

9.48

7.33

250,415

10.00

9.48

31,709

Oppenheimer INTERNATIONAL GROWTH VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.32

17.14

102,670

11.80

15.32

57,487

10.00

11.80

31,108

OLD MUTUAL Large Cap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.09

10.80

106,212

8.67

9.09

109,347

8.35

8.67

139,132

7.72

8.35

171,515

5.93

7.72

168,575

8.45

5.93

99,735

10.00

8.45

21,508

PIMCO VIT high yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.13

16.58

140,350

14.90

16.13

217,913

14.41

14.90

211,290

13.25

14.41

231,784

10.85

13.25

272,765

10.00

10.85

8,425

PIMCO VIT Low Duration

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.39

11.08

295,140

10.07

10.39

357,766

10.04

10.07

342,222

9.92

10.04

382,875

10.00

9.92

275,928

PIMCO VIT TOTAL RETURN

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.39

11.22

197,447

10.08

10.39

288,330

10.00

10.08

52,119

pioneer FUND vct

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.25

11.73

13,316

9.71

11.25

24,425

9.21

9.71

17,322

8.61

9.21

47,138

6.95

8.61

43,763

9.45

6.95

31,022

10.00

9.45

7,912

pioneer GROWTH OPPORTUNITIES VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.74

9.30

10.00

9.74

556

pioneer MID CAP VALUE VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.64

11.13

12,356

10.00

10.64

954

pioneer Small CAP Value VCT

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.84

17.41

34,780

16.90

18.84

57,319

14.80

16.90

58,879

12.19

14.80

107,843

10.00

12.19

31,359

Schwab MarketTrack Growth II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.32

13.97

306,788

11.66

13.32

330,671

11.10

11.66

329,362

10.02

11.10

322,534

7.95

10.02

294,687

9.46

7.95

166,245

10.00

9.46

36,799

Portfolio (0.70)

2007

2006

2005

2004

2003

2002

2001

Schwab Money Market

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.85

11.28

1,494,262

10.44

10.85

1,069,635

10.24

10.44

1,358,385

10.21

10.24

1,243,345

10.21

2,023,463

10.15

10.21

3,429,753

10.00

10.15

776,903

Schwab S&P 500 index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.86

12.40

979,562

10.33

11.86

1,128,811

9.93

10.33

1,230,531

9.05

9.93

1,488,478

7.10

9.05

1,506,724

9.22

7.10

748,969

10.00

9.22

187,288

SELIGMAN COMMUNICATIONS & INFORMATION

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.62

12.14

14,568

10.00

10.62

7,482

THIRD AVENUE VALUE

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.32

9.76

51,529

10.00

10.32

44,929

VAN KAMPEN LIT COMSTOCK

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.26

11.93

13,556

10.62

12.26

12,806

10.00

10.62

9,871

VAN KAMPEN LIT GROWTH & INCOME

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.72

12.99

24,285

11.02

12.72

21,483

10.00

11.02

26,202

WELLS FARGO ADVANTAGE VT DISCOVERY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.73

11.82

137,612

8.55

9.73

161,331

7.85

8.55

172,144

6.64

7.85

168,312

4.98

6.64

185,503

8.03

4.98

126,654

10.00

8.03

58,974

WELLS FARGO ADVANTAGE VT OPPORTUNITY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.17

13.94

99,154

11.82

13.17

128,584

11.03

11.82

155,013

9.39

11.03

226,496

6.90

9.39

269,503

9.50

6.90

162,242

10.00

9.50

53,594

Portfolio (0.85)

2007

2006

2005

2004

2003

AIM V.I. international growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.10

12.62

177,502

10.00

11.10

22,099

AIM V.I. High Yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.51

13.57

28,476

12.31

13.51

30,257

12.08

12.31

37,287

10.99

12.08

36,279

10.00

10.99

13,584

AIM V.I. Technology

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.94

14.89

8,501

12.72

13.94

9,986

12.56

12.72

12,290

12.11

12.56

6,234

10.00

12.11

3,059

Alger American Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.24

13.63

14,959

11.78

12.24

16,227

10.96

11.78

48,697

10.57

10.96

35,620

10.00

10.57

13,647

Alger American Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.83

16.45

207,673

13.27

13.83

92,170

11.94

13.27

105,834

11.42

11.94

83,810

10.00

11.42

36,011

Alger American MidCap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.00

20.87

102,005

14.65

16.00

78,895

13.45

14.65

63,608

12.00

13.45

54,269

10.00

12.00

22,354

AllianceBERNSTEIN VPS Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.97

15.60

223,765

12.87

14.97

209,357

12.38

12.87

243,989

11.20

12.38

208,800

10.00

11.20

70,579

AllianceBERNSTEIN VPS Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.19

15.90

79,267

14.47

14.19

58,346

13.03

14.47

55,470

11.45

13.03

32,220

10.00

11.45

6,019

AllianceBERNSTEIN VPS INTERNATIONAL GROWTH

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.36

17.99

499,709

12.19

15.36

426,600

10.00

12.19

238,184

AllianceBERNSTEIN VPS INTERNATIONAL value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.28

11.84

496,719

10.00

11.28

246,769

AllianceBernstein VPS small/midcap value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.47

10.56

84,062

10.00

10.47

63,196

AllianceBernstein VPS Real Estate Investment

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

24.31

20.60

161,905

18.13

24.31

183,494

16.37

18.13

134,999

12.17

16.37

109,455

10.00

12.17

69,402

AllianceBernstein VPS Utility Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.78

22.79

121,795

15.31

18.78

84,753

13.30

15.31

58,203

10.79

13.30

27,346

10.00

10.79

1,039

American Century VP Balanced

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.21

13.75

79,262

12.16

13.21

74,508

11.68

12.16

66,136

10.73

11.68

42,032

10.00

10.73

4,639

American Century VP Income & Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.35

15.21

143,569

13.22

15.35

178,802

12.74

13.22

199,096

11.37

12.74

152,230

10.00

11.37

33,941

American Century VP International

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.39

21.53

70,220

14.84

18.39

85,336

13.21

14.84

108,282

11.59

13.21

69,617

10.00

11.59

23,853

Portfolio (0.85)

2007

2006

2005

2004

2003

American Century VP Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.98

15.03

253,985

13.58

15.98

250,774

13.04

13.58

188,050

11.50

13.04

74,425

10.00

11.50

24,559

lvip Baron growth opportunities

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

17.08

17.51

195,354

14.91

17.08

208,005

14.55

14.91

197,106

11.68

14.55

125,418

10.00

11.68

26,629

Delaware VIP GROWTH OPPORTUNITIES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.66

14.18

7,671

12.00

12.66

8,205

10.00

12.00

1,421

Delaware VIP Small Cap Value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.23

16.88

234,525

15.82

18.23

255,370

14.58

15.82

254,630

12.11

14.58

163,904

10.00

12.11

80,773

nVIT Mid Cap index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.44

17.50

144,149

15.11

16.44

144,076

13.62

15.11

124,468

11.89

13.62

62,921

10.00

11.89

17,199

Dreyfus IP MidCap Stock

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.27

15.37

29,180

14.29

15.27

32,551

13.20

14.29

32,283

11.63

13.20

21,286

10.00

11.63

8,127

dreyfus vif appreciation

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.25

13.01

36,497

10.61

12.25

29,061

10.25

10.61

1,387

10.00

10.25

411

Dreyfus VIF Developing Leaders

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.09

12.43

5,326

13.70

14.09

7,959

13.05

13.70

11,921

11.83

13.05

15,298

10.00

11.83

4,146

Dreyfus VIF Growth & Income

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.89

14.94

13,890

12.23

13.89

20,406

11.94

12.23

15,152

11.20

11.94

12,048

10.00

11.20

4,334

DWS bLUE CHIP VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.84

13.18

170,978

11.20

12.84

36,754

10.00

11.20

2,467

DWS Capital Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.84

15.45

61,148

12.86

13.84

41,824

11.91

12.86

53,890

11.12

11.91

22,290

10.00

11.12

7,824

DWS DREMAN HIGH RETURN EQUITY VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.70

12.36

149,336

10.79

12.70

282,877

10.00

10.79

15,454

DWS dreman Small MID Cap value vip

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.59

10.83

71,500

10.00

10.59

40,642

DWS health care vip

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.70

12.01

79,526

10.00

10.70

43,455

DWS LARGE CAP VALUE VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

11.98

13.44

92,548

10.47

11.98

55,635

10.00

10.47

53,847

DWS Small Cap Growth VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.91

14.65

33,309

13.32

13.91

34,684

12.55

13.32

35,987

11.40

12.55

38,921

10.00

11.40

13,386

Portfolio (0.85)

2006

2005

2004

2003

DWS Small Cap Index VIP

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

17.43

16.95

75,211

14.96

17.43

67,445

14.47

14.96

75,602

12.39

14.47

132,249

10.00

12.39

53,362

Federated Fund For U.S. Government Securities II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.65

11.23

285,929

10.32

10.65

230,921

10.20

10.32

225,523

9.93

10.20

201,397

10.00

9.93

56,076

Federated International Equity II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

17.24

18.72

25,060

14.62

17.24

27,556

13.52

14.62

33,474

11.95

13.52

39,622

10.00

11.95

11,095

franklin small cap value securities

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.19

9.86

13,263

10.00

10.19

8,845

JANUS ASPEN BALANCED INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.29

14.56

166,568

12.11

13.29

149,007

11.31

12.11

64,795

10.51

11.31

31,722

10.00

10.51

13,180

JANUS ASPEN BALANCED SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.42

148,213

Janus Aspen Flexible bond INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.62

11.27

334,781

10.28

10.62

343,139

10.16

10.28

235,099

9.86

10.16

161,654

10.00

9.86

65,697

Janus Aspen Flexible bond SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.42

104,560

janus Aspen Growth & income INSTITUTIONAL SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.80

15.96

386,388

13.81

14.80

338,549

12.40

13.81

111,652

11.17

12.40

53,530

10.00

11.17

16,662

janus Aspen Growth & income SERVICE SHARES

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.00

10.21

153,245

Janus Aspen Worldwide Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.61

15.89

25,784

12.47

14.61

29,575

11.88

12.47

29,804

11.43

11.88

27,225

10.00

11.43

29,557

JPMorgan Small Company

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.05

16.89

12,452

15.83

18.05

15,259

15.44

15.83

13,259

12.24

15.44

13,210

10.00

12.24

3,393

neuberger berman amt regency

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.21

10.43

12,724

10.00

10.21

6,043

Oppenheimer Global Securities VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

19.66

20.73

348,861

16.85

19.66

287,660

14.87

16.85

245,693

12.58

14.87

166,981

10.00

12.58

39,176

Oppenheimer INTERNATIONAL GROWTH VA

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.29

17.07

199,424

11.79

15.29

94,572

10.00

11.79

35,210

Portfolio (0.85)

2007

2006

2005

2004

2003

OLD MUTUAL Large Cap Growth

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

13.28

15.74

12,816

12.69

13.28

15,226

12.24

12.69

34,396

11.33

12.24

35,613

10.00

11.33

7,357

PIMCO VIT high yield

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.86

13.20

368,662

11.89

12.86

300,138

11.52

11.89

236,973

10.61

11.52

164,512

10.00

10.61

113,185

PIMCO VIT Low Duration

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.34

11.00

743,594

10.03

10.34

780,285

10.01

10.03

647,606

9.91

10.01

454,971

10.00

9.91

115,317

PIMCO VIT TOTAL RETURN

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.36

11.17

1,198,424

10.06

10.36

784,104

10.00

10.06

175,973

pioneer FUND vct

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.37

14.96

48,015

12.43

14.37

25,733

11.81

12.43

13,459

11.06

11.81

11,046

10.00

11.06

6,352

pioneer growth opportunities vct

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

9.73

9.28

9,737

10.00

9.73

6,797

pioneer mid cap value vct

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.63

11.10

25,325

10.00

10.63

4,123

pioneer Small CAP Value vct

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

18.74

17.29

60,120

16.83

18.74

85,143

14.77

16.83

63,431

12.18

14.77

55,266

10.00

12.18

7,535

Schwab MarketTrack Growth II

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.98

15.69

326,676

13.14

14.98

400,328

12.53

13.14

292,308

11.32

12.53

222,989

10.00

11.32

165,803

Schwab Money Market

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.56

10.97

2,647,953

10.18

10.56

1,510,198

9.99

10.18

1,178,676

9.99

964,982

10.00

9.99

752,882

Schwab S&P 500 index

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

14.72

15.38

1,069,568

12.84

14.72

970,617

12.37

12.84

983,799

11.28

12.37

666,583

10.00

11.28

217,600

seligman communications & information

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.61

12.11

21,105

10.00

10.61

14,654

third avenue value

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

10.31

9.73

190,120

10.00

10.31

123,718

VAN KAMPEN LIT COMSTOCK

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.23

11.88

28,143

10.61

12.23

27,267

10.00

10.61

5,933

VAN KAMPEN LIT GROWTH & INCOME

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

12.69

12.94

138,873

11.01

12.69

96,797

10.00

11.01

10,206

Portfolio (0.85)

2007

2006

2005

2004

2003

WELLS FARGO ADVANTAGE VT DISCOVERY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

15.96

19.36

52,061

14.03

15.96

30,520

12.92

14.03

18,244

10.93

12.92

53,190

10.00

10.93

3,396

WELLS FARGO ADVANTAGE VT OPPORTUNITY

Value at beginning of period

Value at end of period

Number of accumulation units Outstanding at end of period

16.22

17.15

30,832

14.58

16.22

23,158

13.63

14.58

38,056

11.63

13.63

47,335

10.00

11.63

31,082

A-1

Appendix B – Net Investment Factor

The Net Investment Factor is determined by dividing (a) by (b), and subtracting (c) from the result where:

(a) is the net result of:

1) the net asset value per share of the Portfolio shares determined as of the end of the current Valuation Period, plus

2) the per share amount of any dividend (or, if applicable, capital gain distributions) made by the Portfolio on shares if the "ex-dividend" date occurs during the current Valuation Period, minus or plus

3) a per unit charge or credit for any taxes incurred by or provided for in the Sub-Account, which is determined by GWL&A to have resulted from the investment operations of the Sub-Account, and

(b) is the net asset value per share of the Portfolio shares determined as of the end of the immediately preceding Valuation Period, and

(c) is an amount representing the Mortality and Expense Risk Charge deducted from each Sub-Account on a daily basis. Such amount is equal to 0.65% if you have selected Death Benefit option 1 or 0.70% if you have selected Death Benefit option 2 on Contracts issued before May 1, 2003 and 0.85% if you have selected Death Benefit option 2 on Contracts issued on May 1, 2003 or thereafter.

The Net Investment Factor may be greater than, less than, or equal to one. Therefore, the Accumulation Unit Value may increase, decrease, or remain unchanged.

The net asset value per share referred to in paragraphs (a)(1) and (b) above, reflects the investment performance of the Portfolio as well as the payment of Portfolio expenses.

B-1

VARIABLE ANNUITY-1 SERIES ACCOUNT

SCHWAB ONESOURCE ANNUITY®

Flexible Premium Variable

Annuity Contracts

issued by

Great-West Life & Annuity Insurance Company

8515 E. Orchard Road

Greenwood Village, Colorado 80111

Telephone: (800) 468-8661 (Outside Colorado)

(800) 547-4957 (Colorado)

STATEMENT OF ADDITIONAL INFORMATION

This Statement of Additional Information is not a prospectus and should be read in conjunction with the Prospectus, dated May 1, 2008, which is available without charge by contacting Schwab Insurance Services, P.O. Box 7666, San Francisco, California 94120-9639, www.schwab.com or at 1-800-838-0650.

The date of this Statement of Additional Information is

May 1, 2008

TABLE OF CONTENTS

Page

GENERAL INFORMATION

B-3

GREAT-WEST LIFE & ANNUITY

AND THE VARIABLE ANNUITY-1 SERIES ACCOUNT

B-3

CALCULATION OF ANNUITY PAYMENTS

B-3

POSTPONEMENT OF PAYMENTS

B-4

SERVICES

B-4

- Safekeeping of Series Account Assets

B-4

- Independent Registered Public Accounting Firm

B-4

- Principal Underwriter

B-5

- Administrative Services

B-5

WITHHOLDING	B-5
FINANCIAL STATEMENTS	B-5

GENERAL INFORMATION

In order to supplement the description in the Prospectus, the following provides additional information about the Contracts and other matters which may be of interest to you. Terms used in this Statement of Additional Information have the same meanings as are defined in the Prospectus under the heading "Definitions."

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

AND THE VARIABLE ANNUITY-1 SERIES ACCOUNT

Great-West Life & Annuity Insurance Company (the "Company"), the issuer of the Contract, is a Colorado corporation qualified to sell life insurance and annuity contracts in Puerto Rico, U.S. Virgin Islands, Guam, the District of Columbia and all states except New York. The Company is a wholly owned subsidiary of GWL&A Financial, Inc., a Delaware holding company. GWL&A Financial, Inc. is an indirect wholly-owned subsidiary of Great-West Lifeco Inc., a Canadian holding company. Great-West Lifeco Inc. is a subsidiary of Power Financial Corporation, a Canadian holding company with substantial interests in the financial services industry. Power Financial Corporation is a subsidiary of Power Corporation of Canada, a Canadian holding and management company. Mr. Paul Desmarais, through a group of private holding companies that he controls, has voting control of Power Corporation of Canada.

The assets allocated to the Series Account are the exclusive property of the Company. Registration of the Series Account under the Investment Company Act of 1940 does not involve supervision of the management or investment practices or policies of the Series Account or of the Company by the Securities and Exchange Commission. The Company may accumulate in the Series Account proceeds from charges under the Contracts and other amounts in excess of the Series Account assets representing reserves and liabilities under the Contract and other variable annuity contracts issued by the Company. The Company may from time to time transfer to its general account any of such excess amounts. Under certain remote circumstances, the assets of one Sub-Account may not be insulated from liability associated with another Sub-Account.

Best's Insurance Reports has assigned the Company to its highest of ten categories for financial strength and operating performance at A+, “Superior.” Fitch, Inc. has assigned the Company its second highest rating of eight categories to AA+, “Very Strong.” Standard & Poor's Corporation has assigned the Company to its second highest of nine categories with an AA, “Very Strong.” Moody's Investors Service has assigned the Company an insurance and financial strength rating of Aa3 (Excellent) which is its second highest category of nine categories.

CALCULATION OF ANNUITY PAYMENTS

Variable Annuity Options

The Company converts the accumulation units for each Sub-Account held by you into Annuity Units at their values determined as of the end of the valuation period which contains the Payout Commencement Date. The number of Annuity Units paid for each Sub-Account is determined by dividing the amount of the first payment by the Annuity Unit value on the first valuation date preceding the date the first payout is due. The number of Annuity Units used to calculate each payout for a Sub-Account remains fixed during the Annuity Payment Period.

The first payment under a variable annuity payment option will be based on the value of each Sub-Account on the first valuation date preceding the Annuity Commencement Date. It will be determined by applying the appropriate rate to the amount applied under the payout option. Payments after the first will vary depending upon the investment experience of the Sub-Accounts. The subsequent amount paid is determined by multiplying (a) by (b) where (a) is the number of Annuity Units to be paid and (b) is the Annuity Unit value on the first valuation date preceding the date the annuity payout is due. The total amount of each variable annuity payout will be the sum of the variable annuity payments for each Sub-Account.

POSTPONEMENT OF PAYMENTS

With respect to amounts allocated to the Series Account, payment of any amount due upon a total or partial surrender, death or under an annuity option will ordinarily be made within seven days after all documents required for such payment are received by the Schwab Insurance & Annuity Service Center. However, the determination, application or payment of any Death Benefit, Transfer, full surrender, partial withdrawal or annuity payment may be deferred (1) for any period (A) during which the New York Stock Exchange is closed (other than customary weekend and holiday closings) or (B) trading on the New York Stock Exchange is restricted, (2) for any period during which an emergency exists as a result of which (A) disposal by the Series Account of securities owned by it is not reasonably practicable or (B) it is not reasonably practicable for the Series Account to determine the value of its net assets, or (3) for such other periods as the Securities and Exchange Commission may by order permit for the protection of securityholders of the Series Account.

SERVICES

Safekeeping of Series Account Assets

The assets of the Series Account are held by the Company. The assets of the Series Account are kept physically segregated and held separate and apart from the general account of the Company. The Company maintains records of all purchases and redemptions of shares of the Portfolios. Additional protection for the assets of the Series Account is afforded by a financial institution bond that includes fidelity coverage issued to The Great-West LifeCo, Inc. and subsidiary companies in the amount of $50 million (Canadian) per occurrence and $100 million (Canadian) aggregate, which covers all officers and employees of the Company.

Independent Registered Public Accounting Firm

Deloitte & Touche LLP, 555 Seventeenth Street, Suite 3600, Denver, CO 80202, serves as the Company’s and the Series Account’s independent registered public accounting firm. Deloitte & Touche LLP examines financial statements for the Company and the Series Account and provides other audit, tax, and related services.

C.	Principal Underwriter

The offering of the Contracts is made on a continuous basis by GWFS Equities, Inc., a wholly owned subsidiary of the Company. GWFS is a Delaware corporation and is a member of FINRA. The Company does not anticipate discontinuing the offering of the Contract, although it reserves the right to do so. The Contract generally will be issued for Annuitants from birth to age ninety. The aggregate dollar amount of commissions paid to, and retained by, GWFS for the Contracts was zero for the last three fiscal years.

Administrative Services

WITHHOLDING

Annuity payments and other amounts received under the Contract are subject to income tax withholding unless the recipient elects not to have taxes withheld. The amounts withheld will vary among recipients depending on the tax status of the individual and the type of payments from which taxes are withheld.

Notwithstanding the recipient's election, withholding may be required with respect to certain payments to be delivered outside the United States. Moreover, special "backup withholding" rules may require the Company to disregard the recipient's election if the recipient fails to supply the Company with a "TIN" or taxpayer identification number (social security number for individuals), or if the Internal Revenue Service notifies the Company that the TIN provided by the recipient is incorrect.

FINANCIAL STATEMENTS

The consolidated financial statements of the Company should be considered only as bearing upon the Company’s ability to meet its obligations under the Contracts, and they should not be considered as bearing on the investment performance of the Series Account. The variable interest of Owners under the Contracts is affected solely by the investment results of the Series Account.

Great-West Life & Annuity Insurance Company

Financial Statements for the Years Ended December 31, 2007 and 2006

and Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholder of
Great-West Life & Annuity Insurance Company
Greenwood Village, Colorado

We have audited the accompanying consolidated balance sheets of Great-West Life & Annuity Insurance Company and subsidiaries (the “Company”) as of December 31, 2007 and 2006, and the related consolidated statements of income, stockholder’s equity, and cash flows for each of the three years in the period ended December 31, 2007. Our audits also included the financial statement schedule listed in the Index at Item 8. These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on the financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 consolidated financial statements present fairly, in all material respects, the financial position of Great-West Life & Annuity Insurance Company and subsidiaries as of December 31, 2007 and 2006, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2007, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 4, the Company changed its method of accounting for income taxes, as required by accounting guidance on January 1, 2007, and changed its method of accounting for defined benefit and other post retirement plans and share based payments as required by accounting guidance which the Company adopted on December 31, 2006, and January 1, 2006, respectively.

/s/ DELOITTE & TOUCHE LLP

Denver, Colorado
March 27, 2008

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Consolidated Balance Sheets
December 31, 2007 and 2006
(In Thousands, Except Share Amounts)


	December 31,

	2007		2006

Assets
Investments:
Fixed maturities available-for-sale, at fair value (amortized cost $13,592,003 and $15,367,735)	$	13,551,233	$	15,309,951
Fixed maturities held for trading, at fair value (amortized cost $22,855 and $0)		23,060		—
Mortgage loans on real estate (net of allowances of $9,448 and $15,661)		1,207,169		1,338,193
Equity investments available-for-sale, at fair value (cost $19,749 and $17,875)		29,576		28,242
Policy loans		3,767,872		3,797,585
Short-term investments, available-for-sale (cost approximates fair value)		472,633		960,999
Limited partnership interests		326,971		345,192
Other investments		4,169		4,413

Total investments		19,382,683		21,784,575
Other assets:
Cash		54,814		32,589
Reinsurance receivable:
Related party		381,931		531,389
Other		123,176		176,368
Deferred acquisition costs and value of business acquired		443,302		505,134
Investment income due and accrued		142,801		159,778
Premiums in course of collection		5,443		10,327
Deferred income taxes		155,548		163,796
Collateral under securities lending agreements		93,472		382,423
Due from parent and affiliates		29,138		10,650
Goodwill		101,655		102,374
Other intangible assets		39,234		43,293
Other assets		522,685		494,399
Assets of discontinued operations		724,766		794,785
Separate account assets		18,089,984		16,289,974

Total assets	$	40,290,632	$	41,481,854

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Consolidated Balance Sheets
December 31, 2007 and 2006
(In Thousands, Except Share Amounts)


	December 31,

	2007			2006

Liabilities and stockholder’s equity
Policy benefit liabilities:
Policy reserves:
Related party	$	2,493,511		$	4,639,829
Other		14,883,183			14,547,742
Policy and contract claims		262,503			309,442
Policyholders’ funds		302,957			272,707
Provision for policyholders’ dividends		78,276			109,700
Undistributed earnings on participating business		209,036			188,198

Total policy benefit liabilities		18,229,466			20,067,618

General liabilities:
Due to parent and affiliates		534,956			547,951
Repurchase agreements		138,537			744,117
Commercial paper		95,667			95,020
Payable under securities lending agreements		93,472			382,423
Other liabilities		648,857			622,513
Liabilities of discontinued operations		468,496			603,283
Separate account liabilities		18,089,984			16,289,974

Total liabilities		38,299,435			39,352,899

Commitments and contingencies (Note 21)

Stockholder’s equity:
Preferred stock, $1 par value, 50,000,000 shares authorized; none issued and outstanding		—			—
Common stock, $1 par value, 50,000,000 shares authorized; 7,032,000 shares issued and outstanding		7,032			7,032
Additional paid-in capital		747,533			737,857
Accumulated other comprehensive income (loss)		(1,518	)		(46,537	)
Retained earnings		1,238,150			1,430,603

Total stockholder’s equity		1,991,197			2,128,955

Total liabilities and stockholder’s equity	$	40,290,632		$	41,481,854


See notes to consolidated financial statements.	(Concluded)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Consolidated Statements of Income
Years Ended December 31, 2007, 2006 and 2005
(In Thousands)


	Year Ended December 31,

	2007			2006			2005

Revenues:
Premium income:
Related party (net of related party premiums ceded of $1,391,980, $4,827 and $5,185)	($	1,146,908	)	$	275,169		$	321,663
Other (net of premiums ceded of $40,380, $47,122 and $61,996		289,641			307,283			324,373
Fee income		463,265			341,372			302,961
Net investment income		1,139,541			1,110,136			1,044,081
Net realized gains (losses) on investments		(2,028	)		(9,465	)		18,697

Total revenues		743,511			2,024,495			2,011,775

Benefits and expenses:
Life and other policy benefits (net of reinsurance recoveries of $39,640, $58,012 and $95,566)		624,381			702,262			632,098
Increase (decrease) in policy reserves:
Related party		(1,539,777	)		29,245			147,466
Other		79,254			11,132			49,571
Interest paid or credited to contractholders		497,438			470,416			477,381
Provision for policyholders’ share of earnings on participating business		20,296			9,061			(3,039	)
Dividends to policyholders		93,544			98,605			100,613

Total benefits		(224,864	)		1,320,721			1,404,090
General insurance expenses		432,426			367,315			294,081
Amortization of deferred acquisition costs and value of business acquired		135,570			46,191			51,528
Interest expense		41,713			33,623			14,396

Total benefits and expenses		384,845			1,767,850			1,764,095

Income from continuing operations before income taxes		358,666			256,645			247,680
Income tax expense		118,791			72,603			66,545

Income from continuing operations		239,875			184,042			181,135
Income from discontinued operations, net of income taxes of $85,707, $79,291 and $94,899		178,853			153,160			190,420

Net income	$	418,728		$	337,202		$	371,555

See notes to consolidated financial statements.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Condensed Consolidated Statements of Stockholder’s Equity
Years Ended December 31, 2007, 2006 and 2005
(In Thousands)


					Accumulated Other Comprehensive Income

	Common Stock		Additional Paid-in Capital		Unrealized Gains (Losses) on Securities			Employee Benefit Plan Adjustments			Retained Earnings			Total

Balances, January 1, 2005	$	7,032	$	725,935	$	133,546		($	14,751	)	$	1,192,599		$	2,044,361
Net income												371,555			371,555
Other comprehensive income (loss):
Net change in unrealized losses						(125,280	)								(125,280	)
Minimum pension liability adjustment									(10,333	)					(10,333	)

Total comprehensive income															235,942
Dividends												(221,358	)		(221,358	)
Income tax benefit on stock-based compensation				2,766											2,766

Balances, December 31, 2005	$	7,032	$	728,701	$	8,266		($	25,084	)	$	1,342,796		$	2,061,711
Net income												337,202			337,202
Other comprehensive income (loss):
Net change in unrealized losses						(23,974	)								(23,974	)
Minimum pension liability adjustment									989						989

Total comprehensive income															314,217
Impact of adopting SFAS No. 158									(6,734	)					(6,734	)
Dividends												(249,395	)		(249,395	)
Capital contribution - stock-based compensation				4,525											4,525
Income tax benefit on stock-based compensation				4,631											4,631

Balances, December 31, 2006	$	7,032	$	737,857	($	15,708	)	($	30,829	)	$	1,430,603		$	2,128,955
Net income												418,728			418,728
Other comprehensive income (loss):
Net change in unrealized gains						9,903									9,903
Minimum pension liability adjustment									34,998						34,998

Total comprehensive income															463,629
Impact of adopting SFAS No. 155						118						(3	)		115
Impact of adopting FIN No. 48												(6,195	)		(6,195	)
Dividends												(604,983	)		(604,983	)
Capital contribution - stock-based compensation				3,816											3,816
Income tax benefit on stock-based compensation				5,860											5,860

Balances, December 31, 2007	$	7,032	$	747,533	($	5,687	)	$	4,169		$	1,238,150		$	1,991,197

See notes to consolidated financial statements.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Consolidated Statements of Cash Flows
Years Ended December 31, 2007, 2006 and 2005
(In Thousands)


	Year Ended December 31,

	2007			2006			2005

Cash flows from operating activities:
Net income	$	418,728		$	337,202		$	371,555
Adjustments to reconcile net income to net cash provided by operating activities:
Earnings allocated to participating policyholders		20,296			9,061			(3,039	)
Amortization of (premiums) accretion of discounts on investments, net		(58,067	)		(55,218	)		(52,712	)
Net realized (gains) losses on investments		(2,155	)		12,076			(38,977	)
Net purchases of trading securities		(20,825	)		—			—
Depreciation and amortization		176,560			77,256			81,847
Deferral of acquisition costs		(73,062	)		(60,187	)		(50,437	)
Deferred income taxes		(5,239	)		32,807			20,108
Changes in assets and liabilities, net of effects of acquisitions:
Policy benefit liabilities		85,799			197,465			86,845
Reinsurance receivable		(106,382	)		40,279			120,793
Accrued interest and other receivables		26,695			(16,501	)		1,022
Other, net		46,513			(25,994	)		(189,526	)

Net cash provided by operating activities		508,861			548,246			347,479


Cash flows from investing activities:
Proceeds from sales, maturities and redemptions of investments:
Fixed maturities available-for-sale		4,052,791			7,486,226			5,783,036
Mortgage loans on real estate		159,959			325,291			250,112
Equity investments and other limited partnership interests		51,596			209,453			240,886
Purchases of investments:
Fixed maturities available-for-sale		(4,015,650	)		(9,146,358	)		(5,933,327	)
Mortgage loans on real estate		(228,746	)		(209,079	)		(122,078	)
Equity investments and other limited partnership interests		(35,372	)		(56,350	)		(121,881	)
Acquisitions, net of cash acquired		(15,208	)		1,301,372			—
Net change in short-term investments		1,132,840			3,459			(574,229	)
Net change in repurchase agreements		(625,242	)		7,874			192,658
Other, net		(36,643	)		(33,629	)		64,505

Net cash provided by (used in) investing activities		440,325			(111,741	)		(220,318	)


See notes to consolidated financial statements.	(Continued)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Consolidated Statements of Cash Flows
Years Ended December 31, 2007, 2006 and 2005
(In Thousands)


	Year Ended December 31,

	2007			2006			2005

Cash flows from financing activities:
Contract deposits	$	1,228,154		$	1,065,805		$	1,166,502
Contract withdrawals		(1,491,994	)		(1,603,285	)		(1,195,166	)
Change in due to parent and affiliates		(31,483	)		323,018			60,426
Dividends paid		(604,983	)		(249,395	)		(221,358	)
Net commercial paper borrowings (repayments)		647			(44	)		20
Change in bank overdrafts		(23,523	)		(1,566	)		7,034
Income tax benefit of stock option exercises		5,860			4,631			2,766

Net cash used in financing activities		(917,322	)		(460,836	)		(179,776	)


Net increase (decrease) in cash		31,864			(24,331	)		(52,615	)
Cash, continuing and discontinued operations, beginning of year		33,572			57,903			110,518

Cash, continuing and discontinued operations, end of year		65,436			33,572			57,903
Less cash, discontinued operations, end of year		(10,622	)		(983	)		(2,382	)

Cash, end of year	$	54,814		$	32,589		$	55,521


Supplemental disclosures of cash flow information:
Net cash paid during the year for:
Income taxes	$	121,847		$	63,619		$	93,608
Interest		41,713			30,959			17,553

Non-cash investing and financing transactions during the years:
Assets transferred from The Canada Life Assurance Company (See Note 5)	$	—		$	87,622		$	468,123
Fair value of assets acquired in settlement of fixed maturity investments					—			4,659
Share-based compensation expense		3,816			4,525			—
Return of invested reinsurance assets to The Canada Life Assurance Company (See Note 5)		1,608,909			—			—


See notes to consolidated financial statements.	(Concluded)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

1. Organization, Basis of Presentation and Significant Accounting Policies

Organization - Great-West Life & Annuity Insurance Company and its subsidiaries (collectively, the “Company”) is a direct wholly-owned subsidiary of GWL&A Financial Inc. (“GWL&A Financial”), a holding company formed in 1998. GWL&A Financial is an indirect wholly-owned subsidiary of Great-West Lifeco Inc. (“Lifeco”). The Company offers a wide range of life insurance and retirement and investment products to individuals, businesses and other private and public organizations throughout the United States. The Company is an insurance company domiciled in the State of Colorado, and is subject to regulation by the Colorado Division of Insurance.

Basis of presentation - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates are required to account for policy reserves, allowances for credit losses on mortgage loans on real estate, deferred acquisition costs and value of business acquired, goodwill and other intangible assets, derivative instruments, valuation of privately placed and non-actively traded public investments, employee benefits plans and taxes on income. Actual results could differ from those estimates.

The consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation.

A reclassification was made in the 2006 consolidated balance sheet to conform to the 2007 presentation. Certain equity investments which in 2007 are presented in limited partnership interests were presented as equity investments in 2006.

Reclassifications were also made to the accompanying consolidated balance sheet at December 31, 2006 and the consolidated statements of income for the years ended December 31, 2006 and 2005 to reflect the Company’s discontinued operations. See Note 2.

The reclassifications had no effect on previously reported net income, total assets or total stockholder’s equity and were made in order to further enhance the readers’ understanding of the Company’s consolidated financial statements.

Significant Accounting Policies

Investments - Investments are reported as follows:


1.	The Company classifies the majority of its fixed maturity and all of its equity investments as available-for-sale and records them at fair value with the related net unrealized gain or loss, net of policyholder related amounts and deferred taxes, recorded in accumulated other comprehensive income in the stockholder’s equity section in the consolidated balance sheets. Net unrealized gains and losses related to participating contract policies are recorded as undistributed earnings on participating business in the Company’s consolidated balance sheets.

	Premiums and discounts are recognized as a component of net investment income using the scientific interest method. Realized gains and losses and declines in value determined to be other-than-temporary are included in net realized gains (losses) on investments.

	During the year ended December 31, 2007, the Company purchased fixed maturity securities which were classified as held for trading. Assets in the held for trading category are carried at fair value with changes in fair value reported in net investment income.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


	The recognition of income on certain investments (e.g. loan-backed securities, including mortgage-backed and asset-backed securities) is dependent upon market conditions, which may result in prepayments and changes in amounts to be earned.

2.	Mortgage loans on real estate are commercial loans and are carried at their unpaid balances adjusted for any unamortized premiums or discounts and allowances for credit losses. Interest income is accrued on the unpaid principal balance. Discounts and premiums are amortized to net investment income using the scientific interest method. Accrual of interest is discontinued on any impaired loans where collection of interest is doubtful.

	The Company maintains an allowance for credit losses at a level that, in management’s opinion, is sufficient to absorb credit losses on its impaired loans. Management’s judgment is based upon extensive situational analysis of each individual loan and may consider past loss experience and current and projected economic conditions. The measurement of impaired loans is based upon the fair value of the underlying collateral.

3.	Equity investments classified as available-for-sale are carried at fair value with net unrealized gains and losses, net of deferred taxes, reported as accumulated other comprehensive income (loss) in the stockholder’s equity section of the Company’s consolidated balance sheets. The Company uses the equity method of accounting for investments in which it has more than a minority interest and has influence in the entity’s operating and financial policies, but does not have a controlling interest. Realized gains and losses and declines in value, determined to be other-than-temporary, are included in net realized gains (losses) on investments.

4.	Limited partnership interests are valued under the cost method of accounting. The Company uses this method since it has a minority equity interest and virtually no influence over the entity’s operations. Also included in other limited partnership interests are limited partnerships established for the purpose of investing in low-income housing that qualify for federal and state tax credits. These securities are carried at amortized cost as determined using the effective yield method.

5.	Policy loans are carried at their unpaid balances.

6.	Short-term investments include securities purchased with initial maturities of one year or less and are carried at amortized cost, which approximates fair value. The Company classifies its short-term investments as available-for-sale.

7.	Gains and losses realized on disposal of investments are determined on a specific identification basis.

8.	The Company may employ a trading strategy that involves the sale of securities with a simultaneous agreement to repurchase similar securities at a future date at an agreed-upon price. Proceeds of the sale are reinvested in other securities and may enhance the current yield and total return. The difference between the sales price and the future repurchase price is recorded as an adjustment to net investment income. During the period between the sale and repurchase, the Company will not be entitled to receive interest and principal payments on the securities sold. Losses may arise from changes in the value of the securities or if the counterparty enters bankruptcy proceedings or becomes insolvent. In such cases, the Company’s right to repurchase the security may be restricted. Amounts owed to brokers under these arrangements are included in repurchase agreements in the accompanying consolidated balance sheets. The liability is collateralized by securities with approximately the same fair value.

9.	The Company receives collateral for lending securities that are held as part of its investment portfolio. The Company requires collateral in an amount greater than or equal to 102% of the market value of domestic securities loaned and 105% of foreign securities loaned. Such collateral is used to replace

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

the securities loaned in event of default by the borrower. The Company’s securities lending transactions are accounted for as collateralized borrowings. Collateral is defined as government securities, letters of credit and/or cash collateral. The borrower can return and the Company can request the loaned securities at any time. The Company maintains ownership of the securities at all times and is entitled to receive from the borrower any payments for interest or dividends received on such securities during the loan term.

Derivative financial instruments - All derivatives, whether designated in hedging relationships or not, are recorded on the consolidated balance sheets in other assets and other liabilities at fair value. Accounting for the ongoing changes in the fair value of a derivative depends upon the intended use of the derivative and its designation as determined when the derivative contract is entered into. If the derivative is designated as a fair value hedge, the changes in its fair value and of the fair value of the hedged item attributable to the hedged risk are recognized in earnings in net investment income. If the derivative is designated as a cash flow hedge, the effective portions of the changes in the fair value of the derivative are recorded in accumulated other comprehensive income in the Company’s consolidated balance sheets and are recognized in the consolidated income statements when the hedged item affects earnings. Changes in the fair value of derivatives not qualifying for hedge accounting and the over effective portion of cash flow hedges are recognized in net investment income in the period of the change.

Cash - Cash includes only amounts in demand deposit accounts.

Bank overdrafts - The Company’s cash management system provides for the reimbursement of all major bank disbursement accounts on a daily basis. Checks issued but not yet presented to banks for payment can result in overdraft balances for accounting purposes and are included in other liabilities in the accompanying consolidated balance sheets. At December 31, 2007 and 2006, these liabilities were $48,449 and $35,167, respectively.

Internal use software - Capitalized internal use software development costs, net of accumulated depreciation, in the amounts of $38,537 and $43,521, are included in other assets at December 31, 2007 and 2006, respectively. The Company capitalized $3,504, $9,329 and $8,732 of internal use software development costs during the years ended December 31, 2007, 2006 and 2005, respectively.

Deferred acquisition costs (“DAC”) and value of business acquired (“VOBA”) - DAC, which primarily consists of sales commissions and costs associated with the Company’s sales representatives related to the production of new business or through the acquisition of insurance or annuity contracts through indemnity reinsurance transactions, have been deferred to the extent recoverable. VOBA represents the estimated fair value of insurance or annuity contracts acquired either directly through the acquisition of another insurance company or through the acquisition of insurance or annuity contracts through assumption reinsurance transactions. The recoverability of such costs is dependent upon the future profitability of the related business. DAC and VOBA associated with the annuity products and flexible premium universal life insurance products are being amortized over the life of the contracts in proportion to the emergence of gross profits. Retrospective adjustments of these amounts are made when the Company revises its estimates of current or future gross profits. DAC and VOBA associated with traditional life insurance are amortized over the premium-paying period of the related policies in proportion to premium revenues recognized. See Note 9 for additional information regarding deferred acquisition costs and the value of business acquired.

Goodwill and other intangible assets - Goodwill is the excess of cost over the fair value of assets acquired and liabilities assumed in connection with an acquisition. The Company tests goodwill for impairment annually or more frequently if events or circumstances indicate that there may be justification for conducting an interim test. If the carrying value of goodwill exceeds its fair value, the excess is recognized as an impairment and recorded as a charge against net income in the period in which the impairment is identified. There were no impairments of goodwill recognized during the years ended December 31, 2007, 2006 or 2005.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

Other intangible assets represent the estimated fair value of the portion of the purchase price that was allocated to the value of customer relationships, preferred provider networks and healthcare provider networks in various acquisitions. These intangible assets have been assigned values using various methodologies, including present value of projected future cash flows, analysis of similar transactions that have occurred or could be expected to occur in the market, and replacement or reproduction cost. The initial valuations of these intangible assets were supported by an independent valuation study that was commissioned by the Company and executed by qualified valuation experts. Other identified intangible assets with finite lives are amortized over their estimated useful lives, which initially ranged from 4 to 14 years (weighted average 13 years), primarily based upon the cash flows generated by these assets.

Separate accounts - Separate account assets and related liabilities are carried at fair value in the accompanying consolidated balance sheets. The Company’s separate accounts invest in shares of Maxim Series Fund, Inc., an open-end management investment company, and Putnam Funds which are affiliates of the Company, in addition to shares of other non-affiliated mutual funds and government and corporate bonds. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contract holders and, therefore, are not included in the Company’s consolidated statements of income. Revenues to the Company from the separate accounts consist of contract maintenance fees, administrative fees and mortality and expense risk charges. The Company’s separate accounts include mutual funds or other investment options that, beginning in 2005, purchase guaranteed interest annuity contracts issued by the Company. During the years ended December 31, 2007 and 2006, these purchases totaled $74,855 and $67,546, respectively. As the general account investment contracts are also included in the separate account balances in the accompanying consolidated balance sheets, the Company has reduced the separate account assets and liabilities by $383,319 and $356,992 at December 31, 2007 and 2006, respectively, to avoid the overstatement of assets and liabilities in its consolidated balance sheets at those dates.

Life insurance and annuity reserves - Life insurance and annuity reserves with life contingencies in the amounts of $11,330,656 and $12,826,595 at December 31, 2007 and 2006, respectively, are computed on the basis of estimated mortality, investment yield, withdrawals, future maintenance and settlement expenses and retrospective experience rating premium refunds. Annuity contract reserves without life contingencies in the amounts of $5,998,749 and $6,318,534 at December 31, 2007 and 2006, respectively, are established at the contract holder’s account value.

Reinsurance - Policy reserves and policy and contract claims ceded to other insurance companies are carried as a reinsurance receivable in the accompanying consolidated balance sheets. The cost of reinsurance related to long duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies.

Policy and contract claims - Policy and contract claims include provisions for claims incurred but not reported and claims in the process of settlement. The provision for claims incurred but not reported is valued based primarily on the Company’s prior experience. The claims in the process of settlement are valued in accordance with the terms of the related policies and contracts.

Participating fund account - The policies in which the policyholder shares in the Company’s participating earnings through policyholder dividends that reflect the difference between the assumptions used in the premium charged and the actual experience. The amount of dividends to be paid is determined annually by the Board of Directors.

Participating life and annuity policy reserves are $6,019,015 and $6,793,239 at December 31, 2007 and 2006, respectively. Participating business approximates 8.3% and 12.8% of the Company’s individual life insurance in-force at December 31, 2007 and 2006, respectively, and 32.4%, 58.0% and 42.0% of individual life insurance premium income for the years ended December 31, 2007, 2006 and 2005, respectively.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company has established a Participating Policyholder Experience Account (“PPEA”) for the benefit of all participating policyholders, which is included in the accompanying consolidated balance sheets. In the event that the assets of the PPEA are insufficient to provide contractually guaranteed benefits, the Company must provide such benefits from its general account assets.

The Company has also established a Participation Fund Account (“PFA”) for the benefit of the participating policyholders previously assumed from The Great-West Life Assurance Company (“GWL”) under an assumption reinsurance transaction. The PFA is part of the PPEA. Earnings derived from the operation of the PFA, net of a management fee paid to the Company, accrue for the benefit of the participating policyholders.

Recognition of premium and fee income and benefits and expenses - Life insurance premiums are recognized when due. Annuity contract premiums with life contingencies are recognized as received. Revenues for annuity and other contracts without significant life contingencies consist of contract charges for the cost of insurance and contract administration and surrender fees that have been assessed against the contract account balance during the period and are recognized when earned. Fees from assets under management, which consist of contract maintenance fees, administration fees and mortality and expense risk charges, are recognized when due. Benefits and expenses on policies with life contingencies are associated with earned premiums so as to result in recognition of profits over the life of the contracts.

Income taxes - Income taxes are recorded using the asset and liability method in which deferred tax assets and liabilities are recorded for expected future tax consequences of events that have been recognized in either the Company’s consolidated financial statements or consolidated tax returns. In estimating future tax consequences, all expected future events, other than the enactments or changes in the tax laws or rules, are considered. Although realization is not assured, management believes it is more likely than not that the deferred tax asset will be realized.

As described more fully in Note 4, the Company adopted FIN No. 48, “Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109”(“FIN 48”) effective January 1, 2007. Among other things, under FIN 48, the Company determines whether it is more-likely-than-not that a tax position will be sustained upon examination by the appropriate taxing authorities before any part of the benefit can be recorded in the consolidated financial statements.

Stock options - Lifeco maintains the Great-West Lifeco Inc. Stock Option Plan (the “Lifeco plan”) that provides for the granting of options on its common shares to certain of its officers and employees and those of its subsidiaries, including the Company. On January 1, 2006, the Company adopted the provisions of Statement of Financial Accounting Standards No. 123R “Share-Based Payment” (“SFAS No. 123R”) which requires it to use the fair value method to recognize the cost of share-based employee compensation. Previously, the Company elected only to disclose the proforma impact of recording the fair value of stock options under the provisions of Statement of Financial Accounting Standards No. 123 “Accounting for Stock-Based Compensation” in the notes to its consolidated financial statements (See Notes 4 and 19).

Regulatory requirements - In accordance with the requirements of the Colorado Division of Insurance, the Company must demonstrate that it maintains adequate capital. At December 31, 2007 and 2006, the Company was in compliance with the requirement. (See Note 12).

In accordance with the requirements of the regulatory authorities in the states in which the Company conducts its business, it is required to maintain deposits with those authorities for the purpose of security for policy and contract holders. The Company fulfills this requirement generally with the deposit of United States government obligations.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

2. Discontinued Operations and Assets and Liabilities Held for Sale

On November 26, 2007, the Company and certain of its subsidiaries entered into a definitive Asset and Stock Purchase Agreement to sell substantially all of their healthcare insurance business to a subsidiary of CIGNA Corporation (“CIGNA”) for $1.5 billion in cash, subject to regulatory and certain other approvals. The transaction is expected to be completed during the second quarter of 2008. The business to be sold, formerly reported as the Company’s Healthcare segment, is the vehicle through which the Company markets and administers group life and health insurance to small and mid-sized employers. CIGNA will acquire from the Company the stop loss, group life, group disability, group medical, group dental, group vision, group prescription drug coverage and group accidental death and dismemberment insurance business in the United States and the Company’s supporting information technology infrastructure through a combination of 100% indemnity reinsurance agreements, renewal rights, related administrative service agreements and the acquisition of certain of the Company’s subsidiaries. The Company will retain a small portion of its Healthcare business and reports it within its Individual Markets segment. Upon completion of the proposed transaction, the Company’s business will be that of its Individual Markets, Retirement Services and Other segments (See Note 18). As required by Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the statements of income and balance sheets of these business activities are presented as discontinued operations for all periods presented in the consolidated financial statements.

In addition, the Company and CIGNA will enter into a Transition Services Agreement (the “Transition Agreement”) whereby the Company will provide certain intellectual technology and administrative and legal services on behalf of CIGNA for a period of up to twenty-four months, which may be extended, following the completion of the proposed transaction. CIGNA will pay the Company pre-determined monthly fees for these services and will reimburse it for other expenditures it makes under the terms of the Transition Agreement.

The following table summarizes the major classifications of assets and liabilities of discontinued operations at December 31, 2007 and 2006:


	December 31,

Assets	2007			2006

Fixed maturities available-for-sale	$	181,051		$	176,704
Short-term investments, available-for-sale		70,044			95,706
Receivables related to uninsured accident and health plan claims, net		134,397			150,854
Reinsurance receivable		46,772			81,987
Goodwill and other intangible assets		58,238			47,475
Premiums in course of collection		91,162			97,547
Deferred income taxes		(9,673	)		9,263
Other		152,775			135,249

Total assets	$	724,766		$	794,785


Liabilities

Policy reserves	$	103,219		$	148,184
Policy and contract claims		84,662			103,580
Policyholders’ funds		106,563			113,594
Other		174,052			237,925

Total liabilities	$	468,496		$	603,283

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table summarizes selected financial information included in income from discontinued operations in the consolidated statements of income for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007		2006		2005

Total revenues from discontinued operations	$	1,343,961	$	1,609,654	$	1,303,960
Total benefits and expenses from discontinued operations		1,079,401		1,377,203		1,018,641

Income from discontinued operations before income taxes		264,560		232,451		285,319
Provision for income taxes		85,707		79,291		94,899

Income from discontinued operations	$	178,853	$	153,160	$	190,420

3. Acquisitions

Metropolitan Life Insurance Company’s 401(k) and defined benefit business

On October 2, 2006, the Company purchased several parts of the full service-bundled, small and midsized 401(k) as well as certain defined benefit plan business from Metropolitan Life Insurance Company and its affiliates (“MetLife”). The assets acquired and liabilities assumed and the results of operations have been included in the Company’s consolidated financial statements since that date. The acquisition included the associated dedicated distribution group, including wholesalers, relationship managers and sales associates. As a result of the acquisition, the Company added approximately 280,000 participants in the 401(k) full service segment and increased its distribution capacity.

The purchase included a 100% coinsurance agreement reinsuring the acquired general account business and a 100% modified-coinsurance agreement reinsuring the acquired separate account business. The Company will replace the acquired MetLife policies with its policies over a three year period. As these policies are replaced, they will no longer be subject to the reinsurance agreements. Under the coinsurance agreement, the Company acquired all of the insurance liabilities associated with these contracts and received from MetLife cash to support these liabilities, net of the purchase price. Under the modified-coinsurance agreement, MetLife retained the approximate $2.3 billion of separate account assets and liabilities but cedes to the Company all of the net profits and losses and related net cash flows. In addition, the Company acquired the rights to provide administrative services and recordkeeping functions for approximately $3.2 billion of participant account values.

The purchase price has been allocated to the assets acquired and liabilities assumed using management’s best estimate of their fair values as of the acquisition date and the use of a third-party business valuation expert to estimate the value of business acquired (“VOBA”) and goodwill. The following table presents an allocation of the purchase price to assets acquired and liabilities assumed as adjusted for revisions to the original purchase price allocation at October 2, 2006:


Assets

Cash acquired, net of cash consideration	$	1,384,117
Value of business acquired		46,033
Goodwill		56,981
Other intangible assets		6,337
Other assets		650

Total assets	$	1,494,118


Liabilities and Stockholder’s Equity

Policy reserves	$	1,486,147
Other liabilities		7,971





Total liabilities	$	1,494,118

VOBA reflects the estimated fair value of in-force contracts acquired and represents the portion of the purchase price that is allocated to the value of the right to receive future cash flows from the contracts in force at the acquisition date. VOBA is based on actuarially determined projections, by each block of business, of future policy and contract charges, premiums, mortality and morbidity, separate account

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

performance, surrenders, operating expenses, investment returns and other factors. Actual experience of the purchased business may vary from these projections. If estimated gross profits or premiums differ from expectations, the amortization of VOBA for these annuity products is adjusted to reflect actual experience. The VOBA has an expected amortization period of 14 years.

The value of the identifiable intangible assets reflects the estimated fair value of customer relationships for the recordkeeping business acquired and amounted to $6,337 as a result of this acquisition. This intangible will be amortized in relation to the expected economic benefits of the agreement. If actual experience with customer relationships differs from expectations, the amortization will be adjusted to reflect actual experience. The customer relationship intangible asset has an expected weighted average amortization period of 14 years.

Goodwill is the excess of the cost of an acquired entity over the net amounts assigned to assets acquired and liabilities assumed. Goodwill resulting from the acquisition amounted to $56,981, all of which has been allocated to the Retirement Services segment. For income tax purposes, all of this goodwill will be deductible over 15 years.

U.S. Bank’s defined contribution business

On December 31, 2006, the Company purchased the full service-bundled, defined contribution business from U.S. Bank. The results of operations of this business have been included in the Company’s consolidated financial statements since that date. The acquired business primarily relates to the administration of approximately 1,900 401(k) plans which represent approximately 195,000 members and more than $9.0 billion in retirement plan assets. The acquisition includes the retention of relationship managers and sales and client service specialists. An adjustment to the purchase price may be paid to or received from U.S. Bank in 2008. The adjustment is contingent upon the attainment of certain revenue and contract retention targets. Any adjustment either paid to or received from U.S. Bank in future years will be recorded as an adjustment to the purchase price allocation in the period in which the contingency is resolved.

The purchase price has been allocated to the assets acquired and liabilities assumed using management’s best estimate of their fair values as of the acquisition date and the use of a third-party business valuation expert to estimate the value of goodwill and other intangible assets acquired. The following table presents an allocation of the purchase price to assets acquired and liabilities assumed as adjusted for revisions to the original purchase price allocation at December 31, 2006:


Assets

Cash consideration	($	72,000	)
Goodwill		38,990
Other intangible assets		35,010

Total assets	$	2,000


Liabilities and Stockholder’s Equity

Other liabilities	$	2,000




Total liabilities	$	2,000

Goodwill is the excess of the cost of an acquired entity over the net amounts assigned to assets acquired and liabilities assumed. Goodwill resulting from the acquisition amounted to $38,990, all of which has been allocated to the Retirement Services segment. For income tax purposes, all of this goodwill will be deductible over 15 years.

The value of the identifiable intangible assets reflects the estimated fair value of customer relationships acquired of $27,040 and the estimated fair value of the preferred provider agreement of $7,970. These intangibles will be amortized in relation to the expected economic benefits of the agreement. If actual experience differs from expectations, the amortization will be adjusted to reflect actual experience. The intangibles have an expected weighted average amortization period of 14 years.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

4. Application of Recent Accounting Pronouncements

Recently adopted accounting pronouncements

In December 2004, the Financial Accounting Standards Board (the “FASB”) issued Statement of Financial Accounting Standards No. 123R, “Share-Based Payment” (“SFAS No. 123R”). SFAS No. 123R replaces Statement of Financial Accounting Standards No. 123 “Accounting for Stock-Based Compensation” (“SFAS No. 123”) and supersedes Accounting Principles Board Opinion No. 25 “Accounting for Stock Issued to Employees” (“APB No. 25”). SFAS No. 123R requires a company to use the fair value method to recognize the cost of its stock-based employee compensation and to provide certain other additional disclosures. Previously, the Company elected only to disclose the proforma impact of recording the fair value of stock options under the provisions of SFAS No. 123 in the notes to its consolidated financial statements. The Company adopted the provisions of SFAS No. 123R on January 1, 2006. The adoption of SFAS No. 123R did not have a material effect on the Company’s consolidated balance sheets or the results of its operations (See Note 19).

In September 2005, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position No. 05-1, “Accounting by Insurance Enterprises for Deferred Acquisition Costs in Connection With Modifications or Exchanges of Insurance Contracts” (“SOP 05-1”). SOP 05-1 provides guidance on accounting by insurance enterprises for deferred acquisition costs on internal replacements of insurance and investment contracts other than those specifically described in FASB Statement of Financial Accounting Standards No. 97, “Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses From the Sale of Investments.” SOP 05-1 defines an internal replacement as a modification in product benefits, features, rights or coverages that occurs by the exchange of a contract for a new contract, or by amendment, endorsement or rider to a contract, or by the election of a feature or coverage within a contract. SOP 05-1 is effective for internal replacements occurring in fiscal years beginning after December 15, 2006. The Company adopted SOP 05-1 on January 1, 2007. The adoption of SOP 05-1 did not have a material effect on the Company’s consolidated financial position or the results of its operations.

In November 2005, the FASB issued Staff Position No. FAS 115-1 and FAS 124-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments” (“FSP 115-1 and 124-1”). FSP 115-1 and 124-1 supersedes Emerging Issues Task Force Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments” and amends Statement of Financial Accounting Standards No. 115 “Accounting for Certain Investments in Debt and Equity Securities,” Statement of Financial Accounting Standards No. 124 “Accounting for Certain Investments Held by Not-for-Profit Organizations” and Accounting Principles Board Opinion No. 18 “The Equity Method of Accounting for Investments in Common Stock.” FSP 115-1 and 124-1 addresses the determination as to when an investment is considered impaired, whether that impairment is other-than-temporary in nature and the measurement of an impairment loss. FSP 115-1 and 124-1 also includes provisions for accounting considerations subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. FSP 115-1 and 124-1 was effective for reporting periods beginning after December 15, 2005 with earlier adoption permitted. The Company adopted FSP 115-1 and 124-1 during its fiscal quarter ended December 31, 2005. The adoption of FSP 115-1 and 124-1 did not have a material effect on the Company’s consolidated financial position or the results of its operations.

In February 2006, the FASB issued Statement of Financial Accounting Standards No. 155, “Accounting for Certain Hybrid Financial Instruments” (“SFAS No. 155”). SFAS No. 155 permits any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation under Statement of Financial Accounting Standards No. 133 “Accounting for Derivative Instruments and Hedging Activities” to be carried at fair value in its entirety, with changes in fair value recognized in earnings. In addition, SFAS No. 155 requires that beneficial interests in securitized financial assets be analyzed to determine whether they are freestanding derivatives or contain an embedded derivative. SFAS No. 155 is applicable to new or

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

modified financial instruments in fiscal years beginning after September 15, 2006, however it may be applied to instruments that an entity holds at the date of adoption on an instrument-by-instrument basis. The Company adopted SFAS No. 155 on January 1, 2007. The adoption of SFAS No. 155 increased stockholder’s equity by $115.

In June 2006, the FASB issued Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in accordance with Statement of Financial Accounting Standards No. 109 “Accounting for Income Taxes”. FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken in a tax return. It also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. The Company adopted FIN 48 on January 1, 2007. The adoption of FIN 48 decreased stockholder’s equity by $6,195.

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans” (“SFAS No. 158”). For fiscal years ending after December 15, 2006, SFAS No. 158 requires a company to recognize in its balance sheet an asset for a defined benefit postretirement plan’s overfunded status or a liability for a plan’s underfunded status and recognize changes in the funded status of a defined benefit postretirement plan in the other comprehensive income section of stockholder’s equity in the year in which the changes occur, and provide additional disclosures. The Company adopted the recognition and disclosure provisions of SFAS No. 158 as of December 31, 2006. The adoption of SFAS No. 158 decreased accumulated other comprehensive income (loss) by $6,734. The adoption of SFAS No. 158 did not affect the results of operations for the year ended December 31, 2006. For fiscal years ended after December 15, 2008, SFAS No. 158 requires a company to measure a defined benefit postretirement plan’s assets and obligations that determine its funded status as of the end of its fiscal year. The Company is evaluating the impact that the adoption of the measurement date provision of SFAS No. 158 will have on its consolidated financial position and results of operations.

In September 2006, the U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB No. 108”). SAB No. 108 provides guidance on how prior year misstatements should be considered when quantifying misstatements in current year financial statements for purposes of assessing materiality. SAB 108 requires that registrants quantify errors using both a balance sheet and income statement approach and evaluate whether either approach results in quantifying a misstatement that, when relevant quantitative and qualitative factors are considered, is material. SAB No. 108 permits companies to initially apply its provisions by either restating prior financial statements or recording a cumulative effect adjustment to the carrying values of assets and liabilities as of January 1, 2006 with an offsetting adjustment to retained earnings for errors that were previously deemed immaterial but are material under the guidance in SAB No. 108. The Company adopted SAB No. 108 on December 31, 2006. The adoption of SAB No. 108 did not have a material effect on the Company’s consolidated financial position.

Accounting pronouncements that will be adopted in the future

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS No. 157”). SFAS No. 157 provides enhanced guidance for using fair value to measure assets and liabilities. SFAS No. 157 also provides expanded information about the extent to which a company measures assets and liabilities at fair value, the information used to measure fair value and the effect of fair value measurements on earnings. SFAS No. 157 is applicable whenever other authoritative pronouncements require or permit assets or liabilities to be measured at fair value. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. The Company adopted the provisions of SFAS No. 157 on January 1, 2008. The adoption of SFAS No. 157 did not have a material effect on the Company’s consolidated financial position or results of its operations.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115” (“SFAS No.159”). SFAS No. 159 permits an entity to measure financial instruments and certain other items at estimated fair value. Most of the provisions of SFAS No. 159 are elective; however, the amendment to FASB No. 115, “Accounting for Certain Investments in Debt and Equity Securities”, applies to all entities that own trading and available-for-sale securities. The fair value option created by SFAS No. 159 permits an entity to measure eligible items at fair value as of specified election dates. The fair value option (a) may generally be applied instrument by instrument, (b) is irrevocable unless a new election date occurs, and (c) must be applied to the entire instrument and not to only a portion of the instrument. SFAS No. 159 is effective as of the beginning of the first fiscal year that begins after November 15, 2007. The Company adopted the provisions of SFAS No. 159 on January 1, 2008. The adoption of SFAS No. 159 did not have a material effect on the Company’s consolidated financial position or results of its operations.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141(R), “Business Combinations” (“SFAS No. 141(R)”) and Statement of Financial Accounting Standards No. 160, “Accounting and Reporting of Noncontrolling Interest in Consolidated Financial Statements, an amendment of ARB No. 51” (“SFAS No. 160”). These statements change the accounting for and reporting of business combination transactions and noncontrolling (minority) interests in consolidated financial statements. Some of the significant changes include the recognition of one hundred percent of the fair value of assets acquired, liabilities assumed and non-controlling interest of acquired businesses; recognition of contingent consideration arrangements at their acquisition date fair values with subsequent changes in fair value reflected in earnings; recognition of acquisition related transaction costs as expense when incurred; and recognition of acquisition related restructuring cost accruals in acquisition accounting only if certain criteria are met as of the acquisition date. SFAS No. 141(R) and SFAS No. 160 are required to be adopted simultaneously and are effective for fiscal years beginning after December 15, 2008. The Company will adopt the provisions of these statements for its fiscal year beginning January 1, 2009. The Company is evaluating the impact that the adoption of SFAS No. 141(R) and SFAS No. 160 will have on its consolidated financial position and the results of its operations.

5. Related Party Transactions

The Company performs administrative services for the United States operations of The Great-West Life Assurance Company (“GWL”), a wholly-owned subsidiary of Lifeco and investment services for London Reinsurance Group, an indirect subsidiary of GWL. The Company provides administrative and operational services for the United States operations of The Canada Life Assurance Company (“CLAC”), an indirect wholly-owned subsidiary of Lifeco. The following table presents revenue and expense reimbursement from related parties for services provided pursuant to these service agreements. These amounts, in accordance with the terms of the various contracts, are based upon estimated costs incurred, including a profit charge, and resources expended based upon the number of policies, certificates in-force and/or administered assets.


	Year Ended December 31,

	2007		2006		2005

Investment management revenue included in net investment income	$	7,959	$	6,772	$	7,377
Administrative and underwriting expense reimbursements included as a reduction to general insurance expenses		1,255		1,399		1,367

Total	$	9,214	$	8,171	$	8,744

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table summarizes amounts due from parent and affiliates at December 31, 2007 and 2006:


			December 31,

Related party	Indebtedness	Due Date	2007		2006

GWL&A Financial Inc.	On account	On demand	$	25,932	$	—
Great-West Life & Annuity Insurance Capital (Nova Scotia) Co.	On account	On demand		521		229
Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II	On account	On demand		1,370		865
Putnam Investments LLC	On account	On demand		1,315		—
The Canada Life Assurance Company	On account	On demand		—		9,556

Total			$	29,138	$	10,650

The following table summarizes amounts due to parent and affiliates at December 31, 2007 and 2006:


			December 31,

Related party	Indebtedness	Due Date	2007		2006

GWL&A Financial Inc. ¹	Surplus note	November 2034	$	194,194	$	194,184
GWL&A Financial Inc. ²	Surplus note	May 2046		333,400		333,400
GWL&A Financial Inc.	Note interest	May 2008		5,095		4,701
GWL&A Financial Inc.	On account	On demand		—		12,907
Great-West Lifeco Finance LP	On account	On demand		582		—
The Great-West Life Assurance Company	On account	On demand		1,046		2,759
The Canada Life Assurance Company	On account	On demand		639		—

Total			$	534,956	$	547,951


¹	A note payable to GWL&A Financial was issued as a surplus note on November 15, 2004, with a face amount of $195,000 and carrying amounts of $194,194 and $194,184 at December 31, 2007 and 2006, respectively. The surplus note bears interest at the rate of 6.675% per annum, payable in arrears on each May 14 and November 14. The note matures on November 14, 2034.

²	A note payable to GWL&A Financial was issued as a surplus note on May 19, 2006, with a face amount and carrying amount of $333,400. The surplus note bears interest initially at the rate of 7.203% per annum, payable in arrears on each May 16 and November 16 until May 16, 2016. After May 16, 2016, the surplus note bears an interest rate of 2.588% plus the then current three-month LIBOR rate. The surplus note is redeemable by the Company at the principal amount plus any accrued and unpaid interest after May 16, 2016. The note matures on May 16, 2046.

	Payments of principal and interest under the surplus notes shall be made only out of surplus funds of the Company and only with prior written approval of the Commissioner of Insurance of the State of Colorado when the Commissioner of Insurance is satisfied that the financial condition of the Company warrants such action pursuant to applicable Colorado law. Payments of principal and interest on the surplus notes are payable only if at the time of such payment and after giving effect to the making thereof, the Company’s surplus would not fall below two and one half times the authorized control level as required by the most recent risk-based capital calculations.

	Interest expense attributable to these related party debt obligations was $37,042, $28,848 and $14,396 for the years ended December 31, 2007, 2006 and 2005, respectively.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

On June 1, 2007, the Company’s Individual Markets segment terminated its reinsurance agreement with an affiliate, The Canada Life Assurance Company (“CLAC”), pursuant to which it had assumed 80% of certain United States life, health and annuity business on a coinsurance and coinsurance with funds withheld basis. The Company recorded, at fair value, the following on June 1, 2007 in its consolidated balance sheet in connection with the termination of the reinsurance agreement:


Assets

Fixed maturities	($	1,177,180	)
Mortgage loans on real estate		(196,743	)
Policy loans		(219,149	)
Reinsurance receivable		(310,865	)
Deferred policy acquisition costs and value of business acquired		(68,809	)
Investment income due and accrued		(15,837	)
Premiums in course of collection		(3,540	)
Deferred income taxes		(18,274	)












Total assets	($	2,010,397	)


Liabilities and Stockholder’s Equity

Policy reserves	($	1,976,028	)
Policy and contract claims		(20,256	)
Policyholders’ funds		(20,464	)
Provision for policyholder dividends		(31,841	)
Undistributed earnings on participating business		8,161
Other liabilities		103

Total liabilities		(2,040,325	)


Accumulated other comprehensive income		7,684
Retained earnings		22,244

Total stockholder’s equity		29,928

Total liabilities and stockholder’s equity	($	2,010,397	)

The Company recorded the following on June 1, 2007 in its consolidated statement of income in connection with the termination of the reinsurance agreement:


Premium income, related party	($	1,387,179	)
Net investment income		58,569
Net realized losses on investments		(14,797	)

Total revenues		(1,343,407	)

Decrease in reserves, related party		(1,453,145	)
Provision for policyholders’ share of earnings on participating business		8,161
Amortization of deferred acquisition costs and value of business acquired		62,961

Total benefits and expenses		(1,382,023	)

Income before income taxes		38,616
Income taxes		16,372

Net income	$	22,244

On July 3, 2007, Great-West Life & Annuity Insurance Company of South Carolina (“GWSC”), a wholly-owned subsidiary of the Company, and CLAC amended their reinsurance agreement pursuant to which the Company assumed additional term life insurance from CLAC. As a result of this amendment, the Company recorded $33,677 in both premium income and increase in reserves in the consolidated statement of income on July 3, 2007. GWL&A Financial obtained two letters of credit for the benefit of the Company during December 2005 as collateral under the GWSC and CLAC reinsurance agreement for on-balance sheet policy liabilities and capital support. The first is for $802,100 and renews automatically until it expires on December 31, 2025. The second letter of credit is for $70,000 and renews automatically. At December 31, 2007 and 2006, there were no outstanding amounts related to these lines of credit.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

As a result of this amendment, the Company also recorded the following in the consolidated balance sheet on July 3, 2007:


Assets

Reinsurance receivable	$	33,677

	$	33,677


Liabilities and Stockholder’s Equity

Policy reserves	$	33,677

	$	33,677

Included within reinsurance receivable in the consolidated balance sheets are $334,169 and $231,842 of funds withheld assets as of December 31, 2007 and 2006, respectively. CLAC pays the Company interest on the funds withheld balance at a rate of 4.55% per annum.

The Company’s separate accounts invest in shares of Maxim Series Fund, Inc., an open-end management investment company, and Putnam Funds which are affiliates of the Company, and shares of other non-affiliated mutual funds and government and corporate bonds. The Company’s separate accounts include mutual funds or other investment options that purchase guaranteed interest annuity contracts issued by the Company. During the years ended December 31, 2007 and 2006, these purchases totaled $74,855 and $67,546 respectively. As the general account investment contracts are also included in the separate account balances in the accompanying consolidated balance sheets, the Company has reduced the separate account assets and liabilities by $383,319 and $356,992 at December 31, 2007 and 2006, respectively, to eliminate these amounts in its consolidated balance sheets at those dates.

6. Summary of Investments

The following table summarizes fixed maturity investments and equity securities classified as available-for-sale at December 31, 2007:


	December 31, 2007

Fixed Maturities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Carrying Value

U.S. government direct obligations and U.S. agencies	$	2,701,076	$	40,661	$	7,287	$	2,734,450	$	2,734,450
Obligations of U.S. states and their subdivisions		1,213,378		61,168		1,129		1,273,417		1,273,417
Foreign governments		1,801		—		31		1,770		1,770
Corporate debt securities		5,327,480		90,847		94,403		5,323,924		5,323,924
Mortgage-backed and asset-backed securities		4,348,268		26,109		156,705		4,217,672		4,217,672

Total fixed maturities	$	13,592,003	$	218,785	$	259,555	$	13,551,233	$	13,551,233

Total equity investments	$	19,749	$	10,414	$	587	$	29,576	$	29,576

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table summarizes fixed maturity investments and equity securities classified as available-for-sale at December 31, 2006:


	December 31, 2006

Fixed Maturities:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Carrying Value

U.S. government direct obligations and U.S. agencies	$	3,681,682	$	21,168	$	28,231	$	3,674,619	$	3,674,619
Obligations of U.S. states and their subdivisions		1,320,202		20,367		22,783		1,317,786		1,317,786
Foreign governments		14,591		—		132		14,459		14,459
Corporate debt securities		5,761,584		83,393		90,398		5,754,579		5,754,579
Mortgage-backed and asset-backed securities		4,589,676		29,374		70,542		4,548,508		4,548,508

Total fixed maturities	$	15,367,735	$	154,302	$	212,086	$	15,309,951	$	15,309,951


Total equity investments	$	17,875	$	10,372	$	5	$	28,242	$	28,242

See Note 7 for additional information on policies regarding estimated fair value of fixed maturity and equity investments.

The amortized cost and estimated fair value of fixed maturity investments classified as available-for-sale at December 31, 2007, by contractual maturity date, are shown in the table below. Actual maturities will likely differ from these projections because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	December 31, 2007

	Amortized Cost		Estimated Fair Value

Maturing in one year or less	$	947,857	$	941,378
Maturing after one year through five years		2,527,759		2,591,909
Maturing after five years through ten years		1,686,852		1,712,933
Maturing after ten years		1,554,714		1,534,061
Mortgage-backed and asset-backed securities		6,874,821		6,770,952

	$	13,592,003	$	13,551,233

Mortgage-backed and asset-backed securities include collateralized mortgage obligations that consist primarily of sequential and planned amortization classes with final stated maturities of two to thirty years and expected average lives of less than one to fifteen years. Prepayments on all mortgage-backed securities are monitored monthly and amortization of the premium and/or the accretion of the discount associated with the purchase of such securities are adjusted by such prepayments.

The following table summarizes information regarding the sales of fixed maturity investments classified as available-for-sale for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007			2006			2005

Proceeds from sales	$	2,488,042		$	5,944,439		$	3,921,643
Gross realized gains from sales		30,834			47,746			33,049
Gross realized losses from sales		(4,309	)		(54,221	)		(38,911	)

Gross realized gains and losses from sales were primarily attributable to changes in interest rates, sales of securities acquired in the current year and gains on repurchase agreement transactions.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company has fixed maturity securities with fair values in the amounts of $11,156 and $12,922 that have been non-income producing for the twelve months preceding December 31, 2007 and 2006, respectively. These securities were written down to their fair value in the period they were deemed to be other-than-temporarily impaired.

Derivative financial instruments - The Company makes limited use of derivative financial instruments to manage interest rate, market credit and foreign exchange risk associated with its invested assets. Derivatives are not used for speculative purposes.

The Company controls the credit risk of its derivative contracts through credit approvals, limits and monitoring procedures. Risk of loss is generally limited to the fair value of derivative instruments and not to the notional or contractual amounts of the derivatives. As the Company enters into derivative transactions only with high quality institutions, no losses associated with non-performance of derivative financial instruments have occurred or are expected to occur.

Fair value hedges - Written call options are used in conjunction with interest rate swap agreements to effectively convert fixed rate bonds to variable rate bonds as part of the Company’s overall asset/liability matching program.

The Company’s use of derivatives treated as fair value hedges has been nominal during the last three years. Hedge ineffectiveness in the amounts of $0, $224 and $0 were recorded as an increase to net investment income during the years ended December 31, 2007, 2006 and 2005, respectively.

Cash flow hedges - Interest rate swap agreements are used to convert the interest rate on certain debt securities from a floating rate to a fixed rate. Foreign currency exchange contracts are used to hedge the foreign exchange rate risk associated with bonds denominated in other than U.S. dollars. Interest rate futures are used to hedge the interest rate risks of forecasted acquisitions of fixed rate maturity investments. These transactions are entered into pursuant to master agreements that provide for a single net payment to be made by one party to the agreement at each due date.

Hedge ineffectiveness in the amount of $606 was recorded as an increase to net investment income during the year ended December 31, 2007, while $89 was recorded as a decrease to net investment income during the year ended December 31, 2006 and $567 was recorded as an increase to net investment income during the year ended December 31, 2005.

Unrealized derivative gains and losses included in accumulated other comprehensive income are reclassified into earnings at the time interest income is recognized. A derivative net loss in the amount of $1,275 was reclassified to net investment income during the year ended December 31, 2007 while derivative net gains in the amounts of $1,709 and $7,853 were reclassified to net investment income during the years ended December 31, 2006 and 2005. As of December 31, 2007, the Company estimates that $1,225 of net derivative gains included in other accumulated comprehensive income will be reclassified into net income within the next twelve months.

Derivatives not designated as hedging instruments - The Company attempts to match the timing of when interest rates are committed on insurance products with other new investments. However, timing differences may occur and can expose the Company to fluctuating interest rates. To offset this risk, the Company uses U.S. Treasury futures contracts. The Company also utilizes U.S. Treasury futures as a method of adjusting the duration of the overall portfolio. Although management believes the above-mentioned derivatives are effective hedges from an economic standpoint, they do not meet the requirements for hedge accounting treatment under Statement of Financial Accounting Standards No. 133 “Accounting for Derivative Instruments and Hedging Activities.”

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company occasionally purchases a financial instrument that contains a derivative instrument that is “embedded” in the financial instrument. Upon purchasing the instrument, the Company assesses whether the economic characteristics of the embedded derivative are clearly and closely related to the economic characteristics of the remaining component of the financial instrument (i.e. the host contract) and whether a separate instrument with the same terms as the embedded instrument could meet the definition of a derivative instrument. When it is determined that (1) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and (2) a separate instrument with the same terms would qualify as a derivative instrument. The Company has the option of separating the embedded derivative from the host contract and carrying it at its fair value or under SFAS No. 155, the Company may carry the entire hybrid instrument at fair value with gains and losses recognized in earnings. Upon adopting SFAS No. 155 on January 1, 2007, the Company no longer bifurcates its credit default swaps.

During the years ended December 31, 2007, 2006 and 2005, decreases in the amounts of $75, $264 and $833, respectively, were recognized in net income from market value changes of derivatives not receiving hedge accounting treatment.

The following tables summarize derivative financial instruments at December 31, 2007 and 2006:


	December 31, 2007

	Notional Amount			Strike/Swap Rate	Maturity

Interest rate swaps		$	338,075	3.94%-4.70%	November 2008- February 2045
Foreign currency exchange contracts			52,001	N/A	March 2014- December 2016
Futures:
Ten year U.S. Treasury Long position			30,900	N/A	March 2008


	December 31, 2006

	Notional Amount			Strike/Swap Rate	Maturity

Interest rate swaps		$	344,876	2.72%-5.37%	April 2007- February 2045
Credit default swaps			98,295	N/A	January 2007- November 2007
Foreign currency exchange contracts			30,000	N/A	December 2016
Futures:
Ten year U.S. Treasury:
Long position			2,100	N/A	March 2007
Five year U.S. Treasury:
Long position			23,500	N/A	March 2007
Total return swap:
Receivable for coinsurance with funds withheld			386,499	Variable	Indeterminable

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

Mortgage loans - The following table summarizes information with respect to impaired mortgage loans at December 31, 2007 and 2006:


	December 31,

	2007		2006

Impaired loans, net of related allowance for credit losses of $0 and $6,213	$	—	$	4,869
Impaired loans with no related allowance for credit losses		—		1,344
Average balance of impaired loans during the year		6,213		11,773
Interest income recognized while impaired		—		50
Interest income received and recorded while impaired using the cash basis method of recognition		—		109

As part of its active loan management policy and in the interest of maximizing the future return of each individual loan, the Company may from time to time modify the original terms of certain loans. These restructured loans, all performing in accordance with their modified terms, aggregated $6,223 and $6,491 at December 31, 2007 and 2006, respectively.

The following table summarizes activity in the allowance for mortgage loan credit losses for the years 2007, 2006 and 2005:


	Year Ended December 31,

	2007			2006		2005

Balance, January 1	$	15,661		$	15,661	$	30,339
Release of provision		(6,213	)		—		(8,000	)
Amounts written off, net of recoveries		—			—		(6,678	)

Balance, December 31	$	9,448		$	15,661	$	15,661

The changes to the allowance for mortgage loan credit losses are recorded in net realized gains (losses) on investments.

Equity investments - The carrying value of the Company’s equity investments was $29,576 and $28,242 at December 31, 2007 and 2006, respectively.

Limited partnership interests - At December 31, 2007 and 2006, the Company had $326,971 and $345,192, respectively, invested in limited partnerships and limited liability corporations. The Company makes commitments to fund partnership interests in the normal course of its business. The amounts of unfunded commitments at December 31, 2007 and 2006 were $18,849 and $27,441, respectively.

Securities pledged, restricted assets and special deposits - The Company pledges investment securities it owns to unaffiliated parties through certain transactions, including securities sold under agreements to repurchase, futures contracts and state regulatory deposits.

The Company had securities on deposit with governmental authorities as required by certain insurance laws with fair values in the amounts of $35,539 and $59,177 at December 31, 2007 and 2006, respectively.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company participates in a securities lending program whereby securities, which are included in invested assets in the accompanying consolidated balance sheets, are loaned to third parties. Securities with a cost or amortized cost in the amounts of $84,851 and $365,219 and estimated fair values in the amounts of $90,087 and $365,341 were on loan under the program at December 31, 2007 and 2006, respectively. The Company was liable for collateral under its control in the amounts of $93,472 and $382,423 at December 31, 2007 and 2006, respectively.

Additionally, the fair value of margin deposits related to futures contracts was approximately $496 and $820 at December 31, 2007 and 2006, respectively.

Impairment of fixed maturity and equity investments classified as available-for-sale - The Company classifies the majority of its fixed maturity and all of its equity investments as available-for-sale and records them at fair value with the related net unrealized gain or loss, net of policyholder related amounts and deferred taxes, being recorded in accumulated other comprehensive income in the stockholder’s equity section in the accompanying consolidated balance sheets. All available-for-sale securities with gross unrealized losses at the balance sheet date are subjected to the Company’s process for the identification and evaluation of other-than-temporary impairments.

The Company writes down to fair value securities that it deems to be other-than-temporarily impaired in the period the securities are deemed to be so impaired. The Company records write-downs as investment losses and adjusts the cost basis of the securities accordingly. The Company does not adjust the revised cost basis for subsequent recoveries in value.

The assessment of whether an other-than-temporary impairment has occurred is based upon management’s case-by-case evaluation of the underlying reasons for the decline in fair value. Management considers a wide range of factors, as described below, regarding the security issuer and uses its best judgment in evaluating the cause of the decline in its estimated fair value and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations and future earnings potential of the issuer.

Considerations used by the Company in the impairment evaluation process include, but are not limited to, the following:


•	Fair value is significantly below cost.

•	The decline in fair value is attributable to specific adverse conditions affecting a particular instrument, its issuer, an industry or geographic area.

•	The decline in fair value has existed for an extended period of time.

•	A debt security has been downgraded by a credit rating agency.

•	The financial condition of the issuer has deteriorated.

•	Dividends have been reduced or eliminated or scheduled interest payments have not been made.

While all available information is taken into account, it is difficult to predict the ultimate recoverable amount from a distressed or impaired security.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

Unrealized losses on fixed maturity and equity investments classified as available-for-sale

The following tables summarize unrealized investment losses by class of investment at December 31, 2007 and 2006. The Company considers these investments to be only temporarily impaired:


		December 31, 2007

		Less than twelve months				Twelve months or longer				Total

Fixed Maturities		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss

U.S. government direct obligations and U.S. agencies		$	93,564	$	1,035	$	584,237	$	6,252	$	677,801	$	7,287
Obligations of U.S. states and their subdivisions			18,748		427		83,482		702		102,230		1,129
Foreign governments			—		—		1,770		31		1,770		31
Corporate debt securities			483,359		19,290		1,907,778		75,113		2,391,137		94,403
Mortgage-backed and asset-backed securities			873,956		74,461		2,097,427		82,244		2,971,383		156,705

Total fixed maturities		$	1,469,627	$	95,213	$	4,674,694	$	164,342	$	6,144,321	$	259,555


Equity investments		$	3,615	$	587	$	—	$	—	$	3,615	$	587

Total number of securities in an unrealized loss position			133				667				800


	December 31, 2006

		Less than twelve months				Twelve months or longer				Total

Fixed Maturities		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss

U.S. government direct obligations and U.S. agencies		$	1,480,131	$	8,560	$	900,247	$	19,671	$	2,380,378	$	28,231
Obligations of U.S. states and their subdivisions			279,895		6,251		456,157		16,532		736,052		22,783
Foreign governments			1,217		7		13,242		125		14,459		132
Corporate debt securities			1,155,371		15,950		2,159,779		74,448		3,315,150		90,398
Mortgage-backed and asset-backed securities			722,367		7,782		2,089,050		62,760		2,811,417		70,542

Total fixed maturities		$	3,638,981	$	38,550	$	5,618,475	$	173,536	$	9,257,456	$	212,086


Equity investments		$	309	$	1	$	79	$	4	$	388	$	5


Total number of securities in an unrealized loss position			978				1,455				2,433

Fixed maturity investments - At December 31, 2007 and 2006, less than 3% and less than 1%, respectively, of these securities were rated non-investment grade. Approximately $21,400 of unrealized losses on mortgage-backed and asset-backed securities were related to a decrease in credit quality; however, the fair value is still approximately 92% of the book value of these securities. The unrealized losses on the remaining securities are primarily attributable to fluctuations in market interest rates and changes in credit spreads since the securities were acquired. These fluctuations, caused by market interest rate changes, have little bearing on whether or not the investment will be ultimately recoverable. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2007.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

At December 31, 2007 and 2006, the Company had $94,403 and $90,398, respectively, of unrealized losses related to its corporate debt fixed maturity securities. Management has classified these securities by sector, calculated as a percentage of total unrealized losses, as follows:


	December 31,

Corporate sector	2007		2006

Finance	53	%	17	%
Utility	19	%	36	%
Consumer	10	%	13	%
Natural resources	8	%	12	%
Transportation	5	%	10	%
Other	5	%	12	%

	100	%	100	%

The increase in unrealized losses in the Finance industry was primarily related to perpetual floating-interest rate securities issued by Canadian and foreign banks. None of the losses were related to a ratings downgrade. All these securities are rated A or above. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2007.

Equity investments - The increase in unrealized losses from 2006 to 2007 is related to issues in the airline industry. At December 31, 2007, the Company has no information indicating that any of these investments are other-than-temporarily impaired.

Other-than-temporary impairment recognition

The Company recorded other-than-temporary impairments on fixed maturity investments in the amounts of $34,485, $6,094 and $12,958 during the years ended December 31, 2007, 2006 and 2005, respectively. Of the $34,485, $20,750 was recognized in connection to the termination of the CLAC reinsurance agreement (See Note 5) because the Company no longer had the intent to hold the investments until recovery. The remaining impairments were primarily related to repurchase agreement financing transactions, corporate debt securities in the auto industry and asset-backed securities with manufactured housing collateral. During the years ended December 31, 2007, 2006 and 2005, the Company recorded other-than-temporary impairments on equity securities in the amounts of $389, $469 and $261, respectively.

7. Estimated Fair Value of Financial Instruments

The following table summarizes the carrying amounts and estimated fair values of the Company’s financial instruments at December 31, 2007 and 2006:


	December 31, 2007				December 31, 2006

Assets	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value

Fixed maturities and short-term investments	$	14,046,926	$	14,046,926	$	16,270,950	$	16,270,950
Mortgage loans on real estate		1,207,169		1,220,186		1,338,193		1,340,089
Equity investments		29,576		29,576		28,242		28,242
Policy loans		3,767,872		3,767,872		3,797,585		3,797,585
Limited partnership interests		326,971		326,971		345,192		345,192
Derivative instruments		8,734		8,734		2,127		2,127
Collateral under securities lending agreements		93,472		93,472		382,423		382,423
Reinsurance receivable		131,506		131,506		133,211		133,211
Separate account assets		18,089,984		18,089,984		16,289,974		16,289,974

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


	December 31, 2007				December 31, 2006

Liabilities	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value

Annuity contract reserves without life contingencies	$	5,998,749	$	6,041,886	$	6,320,290	$	6,312,243
Policyholders’ funds		302,957		302,957		272,707		272,707
Repurchase agreements		138,537		138,537		744,117		744,117
Commercial paper		95,667		95,667		95,020		95,020
Payable under securities lending agreements		93,472		93,472		382,423		382,423
Derivative instruments		3,634		3,634		7,757		7,757
Notes payable		532,689		532,689		532,285		532,285
Separate account liabilities		18,089,984		18,089,984		16,289,974		16,289,974

Fixed maturity and equity securities

The fair values for public fixed maturity and equity securities are based upon quoted market prices or estimates from independent pricing services. However, in cases where quoted market prices are not readily available, such as for private fixed maturity investments, fair values are estimated. To determine estimated fair value for these instruments, the Company generally utilizes discounted cash flow calculated at current market rates on investments of similar quality and term. Fair value estimates are made at a specific point in time, based on available market information and judgments about financial instruments, including estimates of the timing and amounts of expected future cash flows and the credit standing of the issuer or counterparty. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts of the Company’s financial instruments.

Mortgage loans on real estate

Mortgage loan fair value estimates are generally based on discounted cash flows. A discount rate matrix is incorporated whereby the discount rate used in valuing a specific mortgage generally corresponds to that mortgage’s remaining term and credit quality. The rates selected for inclusion in the discount rate matrix reflect rates that the Company would quote if placing loans representative in size and quality to those currently in its portfolio.

Policy loans

Policy loans accrue interest at variable rates with no fixed maturity dates; therefore, estimated fair values approximate carrying values.

Short-term investments, commercial paper, repurchase agreements and collateral under securities lending agreements

The carrying value of short-term investments, commercial paper, repurchase agreements and collateral under securities lending agreements is a reasonable estimate of fair value due to their short-term nature.

Reinsurance receivables

The estimated fair values and carrying amounts of reinsurance receivables at December 31, 2006 include a reduction of $58,569 representing the estimated fair value of the embedded derivative associated with the Company’s reinsurance receivable under its coinsurance with funds withheld agreement with the United States branch of CLAC (See Note 5). Valuation of the derivative is based upon the estimated fair value of the segregated pool of assets from which the Company derives its return on the reinsurance receivable.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

Annuity contract reserves without life contingencies

The estimated fair values of annuity contract reserves without life contingencies are estimated by discounting the cash flows to maturity of the contracts utilizing current interest crediting rates for similar products.

Policyholders’ funds

The estimated fair values of policyholders’ funds are the same as the carrying amounts since the Company can change the interest crediting rates with 30 days notice.

Derivatives

Included in other assets at December 31, 2007 and 2006 are derivative financial instruments in the amounts of $8,734 and $2,127, respectively. Included in other liabilities at December 31, 2007 and 2006 are derivative financial instruments in the amounts of $3,634 and $7,757, respectively. The estimated fair values of over-the-counter derivatives, primarily consisting of interest rate swaps, which are held for other than trading purposes, are the estimated amounts the Company would receive or pay to terminate the agreements at each year-end, taking into consideration current interest rates and other relevant factors.

Notes payable

The estimated fair values of the notes payable to GWL&A Financial are based upon discounted cash flows at current market rates on high quality investments.

Separate account assets and liabilities

Separate account assets and liabilities are adjusted to a net asset value on a daily basis, which approximates fair value.


8. Reinsurance

The Company enters into reinsurance transactions as both a provider and purchaser of reinsurance. In the normal course of business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding risks to other insurance enterprises under excess coverage and coinsurance contracts. The Company retains a maximum liability in the amount of $3,500 of coverage per individual life.

Ceded reinsurance contracts do not relieve the Company from its obligations to policyholders. The failure of reinsurers to honor their obligations could result in losses to the Company. The Company evaluates the financial condition of its reinsurers and monitors concentrations of credit risk arising from similar geographic regions, activities or economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. At December 31, 2007 and 2006, the reinsurance receivables had carrying values in the amounts of $505,107 and $707,757, respectively. Included in these amounts are $381,931 and $531,389 at December 31, 2007 and 2006, respectively, associated with reinsurance agreements with related parties. There were no allowances for potential uncollectible reinsurance receivables at either December 31, 2007 or 2006.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following tables summarize life insurance in-force and total premium income at, and for the year ended, December 31, 2007:


	Life Insurance In-Force

	Individual			Group			Total

Written direct	$	52,406,664		$	31,359,824		$	83,766,488
Reinsurance ceded		(12,229,471	)		—			(12,229,471	)
Reinsurance assumed		93,804,317			—			93,804,317

Net	$	133,981,510		$	31,359,824		$	165,341,334


Percentage of amount assumed to net		70.0	%		0.0	%		56.7	%


	Premium Income

	Life Insurance			Accident and Health			Annuities			Total

Written direct	$	292,972		$	24,367		$	5,058		$	322,397
Reinsurance ceded		(1,403,899	)		(2,853	)		(25,608	)		(1,432,360	)
Reinsurance assumed		252,645			—			51			252,696

Net	($	858,282	)	$	21,514		($	20,499	)	($	857,267	)

The following tables summarize life insurance in-force and total premium income at, and for the year ended, December 31, 2006:


	Life Insurance In-Force

	Individual			Group			Total

Written direct	$	51,586,508		$	30,452,054		$	82,038,562
Reinsurance ceded		(12,307,112	)		—			(12,307,112	)
Reinsurance assumed		86,823,557			—			86,823,557

Net	$	126,102,953		$	30,452,054		$	156,555,007


Percentage of amount assumed to net		68.9	%		0.0	%		55.5	%


	Premium Income

	Life Insurance			Accident and Health			Annuities			Total

Written direct	$	276,929		$	39,760		$	11,087		$	327,776
Reinsurance ceded		(43,025	)		(8,752	)		(172	)		(51,949	)
Reinsurance assumed		306,572			—			53			306,625

Net	$	540,476		$	31,008		$	10,968		$	582,452

The following table summarizes total premium income for the year ended, December 31, 2005:


	Premium Income

	Life Insurance			Accident and Health			Annuities			Total

Written direct	$	309,151		$	44,361		$	4,677		$	358,189
Reinsurance ceded		(51,904	)		(14,520	)		(757	)		(67,181	)
Reinsurance assumed		352,619			—			2,409			355,028

Net	$	609,866		$	29,841		$	6,329		$	646,036

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


9. Deferred Acquisition Costs (“DAC”) and Value of Business Acquired (“VOBA”)

The following table summarizes activity in deferred acquisition costs and value of business acquired for the years ended December 31, 2007, 2006 and 2005:


	DAC			VOBA			Total

Balance, January 1, 2005	$	384,251		$	3,837		$	388,088
Capitalized additions		50,437			—			50,437
Amortization		(51,306	)		(222	)		(51,528	)
Unrealized investment gains		33,433			12			33,445
Purchase accounting adjustment		—			6,000			6,000

Balance, December 31, 2005		416,815			9,627			426,442
Capitalized additions		60,186			46,033			106,219
Amortization		(44,526	)		(1,665	)		(46,191	)
Unrealized investment gains (losses)		18,740			(76	)		18,664

Balance, December 31, 2006		451,215			53,919			505,134
Capitalized additions		73,062			—			73,062
Amortization		(128,575	)		(6,995	)		(135,570	)
Unrealized investment gains		1,121			118			1,239
Purchase accounting adjustment		—			(563	)		(563	)

Balance, December 31, 2007	$	396,823		$	46,479		$	443,302

DAC includes $82,162 and $81,408 at December 31, 2006, and 2005 as the result of the CLAC indemnity reinsurance agreement which was terminated on June 1, 2007 as discussed in Note 5.

The estimated future amortization of VOBA for the years ended December 31, 2008 through December 31, 2012 is as follows:


Year Ended December 31,	Amount

2008	$	6,288
2009		4,190
2010		3,757
2011		3,399
2012		3,096


10. Goodwill and Other Intangible Assets

The balances of and changes in goodwill, all of which is within the Retirement Services segment, for the years ended December 31, 2006 and 2007 are as follows:


	Retirement Services

Balance, January 1, 2006	$	5,784
Additions through acquisitions		96,060
Purchase accounting adjustment		530

Balance, December 31, 2006		102,374
Purchase accounting adjustment		(719	)

Balance, December 31, 2007	$	101,655

See Note 3 for further discussion on acquisitions.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following tables summarize other intangible assets as of December 31, 2007 and 2006:


	December 31, 2007

	Gross Carrying Amount		Accumulated Amortization			Net Book Value

Customer relationships	$	36,999	($	4,154	)	$	32,845
Preferred provider agreements		7,970		(1,581	)		6,389

Total	$	44,969	($	5,735	)	$	39,234


	December 31, 2006

	Gross Carrying Amount		Accumulated Amortization			Net Book Value

Customer relationships	$	29,839	($	1,036	)	$	28,803
Preferred provider agreements		14,490		—			14,490

Total	$	44,329	($	1,036	)	$	43,293

Amortization expense for other intangible assets included in general insurance expenses was $4,699, $497 and $289 for the years ended December 31, 2007, 2006 and 2005, respectively. Except for goodwill, the Company has no intangible assets with indefinite lives.

The estimated future amortization of other intangible assets using current assumptions, which are subject to change, for the years ended December 31, 2008 through December 31, 2012 is as follows:


Year Ended December 31,	Amount

2008	$	4,464
2009		4,258
2010		4,052
2011		3,845
2012		3,639

11. Commercial Paper

The Company has a commercial paper program that is partially supported by a $50,000 corporate credit facility (See Note 21).

The following table provides information regarding the Company’s commercial paper program at December 31, 2007 and 2006:


	December 31,

	2007		2006

Commercial paper outstanding	$	95,667	$	95,020
Maturity range (days)		7 - 88		10 - 89
Interest rate range		4.80% - 5.48%		5.31%- 5.38%

12. Stockholder’s Equity and Dividend Restrictions

At December 31, 2007 and 2006, the Company had 50,000,000 shares of $1 par value preferred stock authorized, none of which were issued or outstanding at either date. In addition, the Company has 50,000,000 shares of $1 par value common stock authorized, 7,032,000 of which were issued and outstanding at both December 31, 2007 and 2006.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company’s net income and capital and surplus, as determined in accordance with statutory accounting principles and practices as prescribed by the National Association of Insurance Commissioners, for the years ended December 31, 2007, 2006 and 2005 are as follows:


	Year Ended December 31,

	2007		2006		2005

	(Unaudited)
Net income	$	518,339	$	280,875	$	391,631
Capital and surplus		1,800,863		1,862,338		1,538,887

Dividends are paid as determined by the Board of Directors, subject to restrictions as discussed below. Dividends in the amount of $604,983, $249,395 and $221,358 were paid to the holder of the Company’s common stock during the years ended December 31, 2007, 2006 and 2005, respectively. In March 2008 the Company also paid a dividend in the amount of $299,985.

The maximum amount of dividends that can be paid to stockholders by insurance companies domiciled in the State of Colorado, without prior approval of the Insurance Commissioner, is subject to restrictions relating to statutory capital and surplus and statutory net gain from operations. Unaudited statutory capital and surplus and net gain from operations at and for the year ended December 31, 2007 were $1,800,863 and $693,306, respectively. The Company may pay up to $693,306 (unaudited) of dividends during 2008 without the prior approval of the insurance commissioner.

13. Other Comprehensive Income

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2007:


	Year Ended December 31, 2007

	Before-tax Amount			Tax (Expense) Benefit			Net-of-tax Amount

Unrealized gains (losses) on available-for-sale securities:
Net changes during the year related to cash flow hedges	$	12,317		($	4,311	)	$	8,006
Unrealized holding gains (losses) arising during the year		3,833			(1,342	)	$	2,491
Less: reclassification adjustment for gains (losses) realized in net income		3,098			(1,084	)		2,014

Net unrealized gains (losses)		19,248			(6,737	)		12,511
Reserve, DAC and VOBA adjustment		(4,013	)		1,405			(2,608	)

Net unrealized gains (losses)		15,235			(5,332	)		9,903
Employee benefit plan adjustment		53,843			(18,845	)		34,998

Other comprehensive income (loss)	$	69,078		($	24,177	)	$	44,901

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2006:


	Year Ended December 31, 2006

	Before-tax Amount			Tax (Expense) Benefit			Net-of-tax Amount

Unrealized gains (losses) on available-for-sale securities:
Net changes during the year related to cash flow hedges	($	7,805	)	$	2,732		($	5,073	)
Unrealized holding gains (losses) arising during the year		(52,398	)		18,339			(34,059	)
Less: reclassification adjustment for gains (losses) realized in net income		3,535			(1,237	)		2,298

Net unrealized gains (losses)		(56,668	)		19,834			(36,834	)
Reserve, DAC and VOBA adjustment		19,785			(6,925	)		12,860

Net unrealized gains (losses)		(36,883	)		12,909			(23,974	)
Employee benefit plan adjustment		1,521			(532	)		989

Other comprehensive income (loss)	($	35,362	)	$	12,377		($	22,985	)

The following table presents the composition of other comprehensive income (loss) for the year ended December 31, 2005:


	Year Ended December 31, 2005

	Before-tax Amount			Tax (Expense) Benefit			Net-of-tax Amount

Unrealized gains (losses) on available-for-sale securities:
Net changes during the year related to cash flow hedges	$	5,753		($	2,014	)	$	3,739
Unrealized holding gains (losses) arising during the year		(256,982	)		89,142			(167,840	)
Less: reclassification adjustment for gains (losses) realized in net income		(3,474	)		1,216			(2,258	)

Net unrealized gains (losses)		(254,703	)		88,344			(166,359	)
Reserve, DAC and VOBA adjustment		63,393			(22,314	)		41,079

Net unrealized gains (losses)		(191,310	)		66,030			(125,280	)
Employee benefit plan adjustment		(15,897	)		5,564			(10,333	)

Other comprehensive income (loss)	($	207,207	)	$	71,594		($	135,613	)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

14. Net Investment Income and Realized Gains (Losses) on Investments

The following table summarizes net investment income for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007			2006			2005

Investment income:
Fixed maturity and short-term investments	$	782,013		$	780,272		$	722,441
Equity investments		2,260			5,794			11,818
Mortgage loans on real estate		66,994			79,316			92,239
Policy loans		205,772			208,511			202,944
Limited partnership interests		10,887			13,818			6,428
Interest on funds withheld balances under reinsurance agreements		21,199			49,952			56,616
Change in fair value of an embedded derivative contained in a reinsurance agreement		(5,521	)		(18,986	)		(24,346	)
Other, including interest income from related parties of $5,240, $22,505 and $32,723		71,734			6,986			(7,691	)

		1,155,338			1,125,663			1,060,449
Investment expenses		(15,797	)		(15,527	)		(16,368	)

Net investment income	$	1,139,541		$	1,110,136		$	1,044,081

The following table summarizes net realized gains (losses) on investments for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007			2006			2005

Net realized gains (losses):
Fixed maturity and short-term investments	($	9,570	)	($	8,978	)	($	17,377	)
Equity investments		(48	)		(2,768	)		24,972
Mortgage loans on real estate		3,202			2,725			(3,375	)
Limited partnership interests		(38	)		(835	)		—
Other		590			(123	)		(200	)
Provision for mortgage impairments, net of recoveries		3,836			514			14,677

Net realized gains (losses) on investments	($	2,028	)	($	9,465	)	$	18,697

Included in net investment income and net realized gains (losses) on investments are amounts allocable to the participating fund account. This allocation is based upon the activity in a specific block of invested assets that are segmented for the benefit of the participating fund account. The amounts of net investment income allocated to the participating fund account were $373,244, $373,278 and $351,149 for the years ended December 31, 2007, 2006 and 2005, respectively. The amounts of net realized losses allocated to the participating fund account were $4,669, $12,465 and $3,300 for the years ended December 31, 2007, 2006 and 2005, respectively.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

15. General Insurance Expenses

The following table summarizes the components of general insurance expenses for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007			2006			2005

Compensation	$	281,670		$	251,345		$	231,806
Commissions		128,003			103,488			61,998
Premium and other taxes		21,366			19,209			13,302
Capitalization of DAC		(73,062	)		(60,186	)		(50,437	)
Rent, net of sublease income		5,752			7,873			5,579
Other		68,697			45,586			31,833

Total general insurance expenses	$	432,426		$	367,315		$	294,081

16. Employee Benefit Plans

On December 31, 2006, the Company adopted the recognition and disclosure provisions of SFAS No. 158. SFAS No. 158 required the Company to recognize the funded status (i.e., the difference between the fair value of plan assets and the projected benefit obligations for the Defined Benefit Pension Plan or the accumulated post retirement benefit obligation for the Post Retirement Medical Plan) of its pension plan and post retirement medical plan beginning in its December 31, 2006 statement of financial position, with a corresponding adjustment to accumulated other comprehensive income, net of tax. The adjustment to accumulated other comprehensive income at adoption represents the net unrecognized actuarial losses, unrecognized prior service costs and unrecognized transition obligation remaining from the initial adoption of Statement of Financial Accounting Standards No. 87, “Employer’s Accounting for Pensions” (“SFAS No. 87”) all of which were previously netted against the plan’s funded status in the Company’s statement of financial position pursuant to the provisions of SFAS No. 87. These amounts will be subsequently recognized as net periodic pension cost pursuant to the Company’s historical accounting policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic pension cost in the same periods will be recognized as a component of other comprehensive income. Those amounts will be subsequently recognized as a component of net periodic pension cost on the same basis as the amounts recognized in accumulated other comprehensive income at the time of adoption of SFAS No. 158.

Defined Benefit Pension and Post Retirement Medical Plans - The Company has a noncontributory Defined Benefit Pension Plan covering substantially all of its employees that were hired before January 1, 1999. Pension benefits are based principally on an employee’s years of service and compensation levels near retirement. The Company’s policy for funding the defined benefit pension plans is to make annual contributions, which equal or exceed regulatory requirements.

The Company sponsors an unfunded Post Retirement Medical Plan (the “medical plan”) that provides health benefits to retired employees who are not Medicare eligible. The medical plan is contributory and contains other cost sharing features, which may be adjusted annually for the expected general inflation rate. The Company’s policy is to fund the cost of the medical plan benefits in amounts determined at the discretion of management.

During December 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the “Act”) was signed into law. Under the Act, which took effect on January 1, 2006, employers who sponsor postretirement plans that provide for a prescription drug benefit under Medicare Part D may be entitled to a subsidy payment. In conjunction with the effect of this legislation, the Company amended its post retirement medical plan, whereby it eliminated the provision of medical benefits for retired employees once

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

they become Medicare eligible. The adoption of the amendment resulted in a reduction of the Company’s estimated post retirement medical plan benefit obligation in the amount of $34,965 on January 1, 2006.

A November 30 measurement date is used for the Defined Benefit Pension and Post Retirement Medical plans. Prepaid benefit costs and intangible assets are included in other assets and accrued benefit costs and unfunded status amounts are included in other liabilities in the accompanying consolidated balance sheets.

The following tables provide a reconciliation of the changes in the benefit obligations, fair value of plan assets, and the under funded status for the Company’s Defined Benefit Pension and Post Retirement Medical plans as of the years ended December 31, 2007 and 2006:


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	2007			2006			2007			2006

Change in projected benefit obligation:
Benefit obligation, January 1	$	300,773		$	275,646		$	25,647		$	23,923
Service cost		9,685			9,406			2,050			1,851
Interest cost		17,293			15,970			1,489			1,309
Actuarial (gain) loss		(41,275	)		6,166			(2,007	)		(433	)
Benefits paid		(8,230	)		(7,463	)		(971	)		(1,003	)
Plan change		—			1,048			—			—

Benefit obligation, December 31	$	278,246		$	300,773		$	26,208		$	25,647


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	2007			2006			2007			2006

Change in plan assets:
Value of plan assets, January 1	$	256,533		$	208,753		$	—		$	—
Actual return on plan assets		22,849			19,243			—			—
Employer contributions		3,300			36,000			971			1,003
Benefits paid		(8,230	)		(7,463	)		(971	)		(1,003	)

Value of plan assets, December 31	$	274,452		$	256,533		$	—		$	—


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	2007			2006			2007			2006

Funded (under funded) status at December 31	($	3,794	)	($	44,240	)	($	26,208	)	($	25,647	)


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	2007			2006			2007			2006

Amounts recognized in consolidated balance sheets:
Prepaid benefit cost (accrued benefit liability)	($	3,794	)	($	44,240	)	($	51,663	)	($	52,171	)
Accumulated other comprehensive income		(11,674	)		(59,213	)		25,455			26,523

The accumulated benefit obligation for the Defined Benefit Pension Plan was $260,147 and $279,828 at December 31, 2007 and 2006, respectively.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table provides information regarding amounts in accumulated other comprehensive income that have not yet been recognized as components of net periodic benefit costs at December 31, 2007:


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	Gross			Net of tax			Gross			Net of tax

Net gain (loss)	($	16,531	)	($	10,745	)	($	8,154	)	($	5,300	)
Net prior service (cost) credit		(1,199	)		(779	)		33,609			21,846
Net transition asset (obligation)		6,056			3,937			—			—

	($	11,674	)	($	7,587	)	$	25,455		$	16,546

The following table provides information regarding amounts in accumulated other comprehensive income that are expected to be recognized as components of net periodic benefit costs during the year ended December 31, 2008:


	Defined Benefit Pension Plan						Post Retirement Medical Plan

	Gross			Net of tax			Gross			Net of tax

Net gain (loss)	$	—		$	—		($	408	)	($	266	)
Net prior service (cost) credit		(218	)		(142	)		3,727			2,423
Net transition asset (obligation)		1,514			984			—			—

	$	1,296		$	842		$	3,319		$	2,157

The expected benefit payments for the Company’s Defined Benefit Pension and Post Retirement Medical Plans for the years indicated are as follows:


	Defined Benefit Pension Plan		Post Retirement Medical Plan

2008	$	9,626	$	986
2009		10,403		1,164
2010		11,019		1,378
2011		12,046		1,652
2012		13,380		1,875
2013 through 2017		87,195		14,060

Net periodic (benefit) cost of the Defined Benefit Pension Plan and the Post Retirement Medical Plan included in general insurance expenses in the accompanying consolidated statements of income for the years ended December 31, includes the following components.


	Defined benefit pension plan

	2007			2006			2005

Components of net periodic (benefit) cost:
Service cost	$	9,685		$	9,406		$	8,498
Interest cost		17,293			15,970			14,537
Expected return on plan assets		(20,166	)		(16,835	)		(15,610	)
Amortization of transition obligation		(1,514	)		(1,514	)		(1,514	)
Amortization of unrecognized prior service cost		218			462			632
Amortization of loss from earlier periods		4,877			5,447			4,035

Net periodic (benefit) cost	$	10,393		$	12,936		$	10,578

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


	Post Retirement Medical Plan

	2007			2006			2005

Components of net periodic (benefit) cost:
Service cost	$	2,050		$	1,851		$	2,385
Interest cost		1,489			1,309			2,421
Expected return on plan assets		—			—			—
Amortization of transition obligation		—			—			—
Amortization of unrecognized prior service cost		(3,727	)		(3,727	)		(1,868	)
Amortization of loss from earlier periods		651			633			532

Net periodic (benefit) cost	$	463		$	66		$	3,470

The following table presents the assumptions used in determining benefit obligations of the Defined Benefit Pension Plan and the Post Retirement Medical Plan for the years ended December 31, 2007, 2006 and 2005:


	Defined Benefit Pension Plan

	2007			2006			2005

Discount rate		6.75	%		5.75	%		5.75	%
Expected return on plan assets		8.00	%		8.00	%		8.00	%
Rate of compensation increase		3.19	%		3.19	%		3.19	%


	Post Retirement Medical Plan

	2007			2006			2005

Discount rate		6.75	%		5.75	%		5.75	%

The discount rate has been set based upon the rates of return on high-quality fixed-income investments currently available and expected to be available during the period the benefits will be paid. In particular, the yields on bonds rated AA or better on the measurement date have been used to set the discount rate.

Assumed healthcare cost trend rates have a significant effect on the amounts reported for the Post Retirement Medical Plan. For measurement purposes, a 9.00% annual rate of increase in the per capita cost of covered healthcare benefits was assumed and that the rate would gradually decrease to a level of 5.25% by 2016.

The following table presents what a one-percentage-point change would have on assumed healthcare cost trend rates:


	One percentage point increase			One percentage point decrease

Increase (decrease) on total service and interest cost on components		$	4,058		($	3,098	)
Increase (decrease) on post-retirement benefit obligation			519			(441	)

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table presents how the Company’s Defined Benefit Pension Plan assets are invested at December 31, 2007 and 2006:


	December 31,

	2007			2006

Equity securities		73	%		70	%
Debt securities		25	%		28	%
Other		2	%		2	%

Total		100	%		100	%

The following table presents the Company’s target allocation for invested Defined Benefit Pension Plan assets at December 31, 2008:


	December 31, 2008

Equity securities	70	%
Debt securities	25	%
Other	5	%

Total	100	%

Management estimates the value of these investments will be recoverable. The Company does not expect any plan assets to be returned to it during the year ended December 31, 2008. The Company made a contribution in the amount of $3,300 to its Defined Benefit Pension Plan during the year ended December 31, 2007. The Company expects to contribute approximately $986 to its Post Retirement Medical Plan during the year ended December 31, 2008.

The investment objective of the Defined Benefit Pension Plan is to provide an attractive risk-adjusted return that will ensure the payment of benefits while protecting against the risk of substantial investment losses. Correlations among the asset classes are used to identify an asset mix that the Company believes will provide the most attractive returns. Long-term return forecasts for each asset class using historical data and other qualitative considerations to adjust for projected economic forecasts are used to set the expected rate of return for the entire portfolio.

Supplemental executive retirement plan - The Company also provides supplemental executive retirement plans to certain key executives. These plans provide key executives with certain benefits upon retirement, disability or death based upon total compensation. The Company has purchased individual life insurance policies with respect to each employee covered by this plan. The Company is the owner and beneficiary of the insurance contracts. The Company’s expense for these plans was $4,869, $4,942 and $3,732 for the years ended December 31, 2007, 2006 and 2005, respectively. The liability associated with these plans was $41,676 and $46,084 at December 31, 2007 and 2006, respectively, and is included in other liabilities in the accompanying consolidated balance sheets.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following tables summarize changes in the benefit obligations, plan assets and funded status for the Company’s Supplemental Executive Retirement Plans for the years ended December 31, 2007 and 2006:


	Supplemental Executive Retirement Plan

	December 31,

	2007			2006

Change in projected benefit obligation:
Benefit obligation, January 1	$	46,085		$	45,771
Service cost		1,044			964
Interest cost		2,589			2,565
Actuarial (gain) loss		(6,136	)		(1,270	)
Benefits paid		(1,906	)		(1,946	)

Benefit obligation, December 31	$	41,676		$	46,084


	Supplemental Executive Retirement Plan

	December 31,

	2007			2006

Change in plan assets:
Fair value of plan assets, January 1	$	—		$	—
Employer contributions		1,906			1,946
Benefits paid		(1,906	)		(1,946	)

Fair value of plan assets, December 31	$	—		$	—


	Supplemental Executive Retirement Plan

	December 31,

	2007			2006

Underfunded status	($	41,676	)	($	46,084	)
Accumulated other comprehensive expense (income)		(123	)		219


	Gross			Net of tax

Net gain (loss)	($	283	)	($	184	)
Net prior service (cost) credit		(7,085	)		(4,606	)

	($	7,368	)	($	4,790	)


	Gross		Net of tax

Net gain (loss)	$	250	$	162
Net prior service (cost) credit		986		642

	$	1,236	$	804

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The expected benefit payments for the Company’s Supplemental Executive Retirement Plans for the years indicated are estimated as follows:


2008	$	1,768
2009		2,058
2010		2,230
2011		2,483
2012		2,478
2013 through 2017		16,293

Net periodic cost of the Supplemental Executive Retirement Plans included in general insurance expenses in the accompanying consolidated statements of income for the years ended December 31, includes the following components:


	Year Ended December 31,

	2007		2006		2005

Components of net periodic (benefit) cost:
Service cost	$	1,044	$	964	$	818
Interest cost		2,589		2,564		2,147
Amortization of unrecognized prior service cost		986		1,024		598
Amortization of loss from earlier periods		250		390		169

Net periodic cost	$	4,869	$	4,942	$	3,732

The following table presents the assumptions used in determining benefit obligations for the Supplemental Executive Retirement Plans for the years ended December 31, 2007, 2006 and 2005:


	Year Ended December 31,

	2007		2006		2005

Discount rate	6.75	%	5.75	%	5.75	%
Rate of compensation increase	6.00	%	6.00	%	6.00	%

Other employee benefit plans - The Company sponsors a defined contribution 401(k) retirement plan, which provides eligible participants with the opportunity to defer up to 50% of base compensation. The Company matches 50% of the first 5% of participant pre-tax contributions for employees hired before January 1, 1999. For all other employees, the Company matches 50% of the first 8% of participant pre-tax contributions. Company contributions for the years ended December 31, 2007, 2006 and 2005 were $9,573, $8,825 and $8,153, respectively.

The Company has an executive deferred compensation plan providing key executives with the opportunity to participate in an unfunded deferred compensation program. Under the program, participants may defer base compensation and bonuses and earn interest on the amounts deferred. The program is not qualified under Section 401 of the Internal Revenue Code. Participant balances, which are reflected in other liabilities in the accompanying consolidated balance sheets, are $17,934 and $18,495 at December 31, 2007 and 2006, respectively. The participant deferrals earned interest at the average rates of 6.50% and 6.49% during the years ended December 31, 2007 and 2006, respectively. The interest rate is based on the Moody’s Average Annual Corporate Bond Index rate plus 0.45% for actively employed participants and fixed rates ranging from 6.41% to 8.30% for retired participants. Interest expense related to this plan was $1,261, $1,295 and $1,199 for the years ended December 31, 2007, 2006 and 2005, respectively, and is included in general insurance expenses in the consolidated statements of income.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company has a deferred compensation plan for select sales personnel with the opportunity to participate in an unfunded deferred compensation program. Under this program, participants may defer compensation and earn interest on the amounts deferred. The program is not qualified under Section 401 of the Internal Revenue Code. Effective January 1, 2005, this program no longer accepted participant deferrals. Participant balances, which are included in other liabilities in the accompanying consolidated balance sheets, are $5,257 and $5,658 at December 31, 2007 and 2006, respectively. The participant deferrals earned interest at the average rate of 4.6% and 4.5% during the years ended December 31, 2007 and 2006, respectively. The interest rate is based on an annual rate determined by the Company. The interest expense related to this plan was $258, $269 and $282 for the years ended December 31, 2007, 2006 and 2005, respectively, and is included in general insurance expense in the consolidated statements of income.

The Company offers an unfunded, non-qualified deferred compensation plan to a select group of management and highly compensated individuals. Participants defer a portion of their compensation and realize potential market gains or losses on the invested contributions. The program is not qualified under Section 401 of the Internal Revenue Code. Participant balances, which are included in other liabilities in the accompanying consolidated balance sheets, are $14,533 and $12,531 at December 31, 2007 and 2006, respectively. Unrealized gains on invested participant deferrals were $997, $1,556 and $542 for the years ended December 31, 2007, 2006 and 2005, respectively.

17. Federal Income Taxes

The provision for income taxes is comprised of the following:


	Year Ended December 31,

	2007		2006		2005

Current	$	60,813	$	35,892	$	52,304
Deferred		57,978		36,711		14,241

Total income tax provision	$	118,791	$	72,603	$	66,545

The following table presents a reconciliation between the statutory federal income tax rate and the Company’s effective federal income tax rate from continuing operations for the years ended December 31, 2007, 2006 and 2005:


	2007		2006		2005

Statutory federal income tax rate	35.0	%	35.0	%	35.0	%
Income tax effect of:
Reduction in tax contingency	—		(1.8	%)	(0.5	%)
Investment income not subject to federal tax	(1.6	%)	(2.5	%)	(2.3	%)
Tax credits	(2.8	%)	(4.8	%)	(4.6	%)
State income taxes net of federal benefit	0.5	%	0.7	%	0.9	%
Other, net	2.0	%	1.6	%	(1.6	%)

Effective federal income tax rate from continuing operations	33.1	%	28.2	%	26.9	%

The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, the Company recognized approximately an $87,427 increase in the liability for unrecognized tax benefits, of which $6,195 was accounted for as a reduction to the January 1, 2007 balance of retained earnings, $4,505 was accounted for as a reduction to a liability previously accounted for under Statement of Financial Accounting Standards No. 5 “Accounting for Contingencies”, and a $76,727 increase related to temporary items. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


Balance, January 1, 2007	$	87,427
Additions for tax positions in the current year		3,957
Additions for tax positions in prior years		21,749
Reductions for tax positions in prior years		(51,847	)

Balance, December 31, 2007	$	61,286

Included in the unrecognized tax benefits of $61,286 at December 31, 2007 was $4,086 of tax benefits that, if recognized, would increase the annual effective tax rate.

The Company recognizes interest and accrues penalties related to unrecognized tax benefits in current income tax expense. During the year ended December 31, 2007, the Company recognized approximately $1,300 in interest and penalties related to the uncertain tax positions. The Company had accrued approximately $5,632 for the payment of interest and penalties at December 31, 2007.

During the current year, the Company executed closing agreements with the Internal Revenue Service (the “IRS”) for all federal examinations on tax years 1994 through 2004. Tax years 2005 and 2006 are still open to federal examination by the IRS. The Company is not currently under federal examination. The Company does not expect significant increases or decreases to the unrecognized tax benefits in 2008. Also, the Company does not expect significant increases or decreases relating to state and local audits.

The Company has reduced its liability for tax contingencies in each of the last three years due to the completion of Internal Revenue Service examinations.

Deferred income taxes represent the tax effect of the differences between the book and tax bases of assets and liabilities. The tax effect of temporary differences, which give rise to the deferred tax assets and liabilities as of December 31, 2007 and 2006, are as follows:


	December 31,

	2007				2006

	Deferred Tax Asset		Deferred Tax Liability		Deferred Tax Asset		Deferred Tax Liability

Policyholder reserves	$	—	$	45,769	$	97,442	$	—
Deferred acquisition costs		—		55,363		—		39,917
Investment assets		—		39,351		—		93,596
Policyholder dividends		29,942		—		29,939		—
Net operating loss carryforward		208,714		—		172,709		—
Other		57,375		—		—		2,781

Total deferred taxes	$	296,031	$	140,483	$	300,090	$	136,294

Amounts presented for investment assets above include $(3,082) and $4,329 related to the unrealized (gains) losses on the Company’s fixed maturity and equity investments, which are classified as available-for-sale at December 31, 2007 and 2006, respectively.

The Company, together with certain of its subsidiaries, and GWL&A Financial have entered into an income tax allocation agreement whereby GWL&A Financial files a consolidated federal income tax return. Under the agreement, these companies are responsible for and will receive the benefits of any income tax liability or benefit computed on a separate tax return basis. Certain other subsidiaries file their federal income tax returns separately.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company has federal net operating loss carry forwards generated by a subsidiary that files an income tax return separate from the GWL&A Financial consolidated federal income tax return. As of December 31, 2007, the subsidiary had net operating loss carry forwards expiring as follows:


Year	Amount

2025	$	371,058
2026		113,001
2027		112,267

Total	$	596,326

Included in due from parent and affiliates at December 31, 2007 and 2006 is $31,376 and ($14,707), respectively, of income taxes receivable (payable) to GWL&A Financial related to the consolidated income tax return filed by the Company and certain subsidiaries. Included in the consolidated balance sheets at December 31, 2007 and 2006 is $135 and $12,034 of income taxes payable in other liabilities related to the separate federal income tax returns filed by certain subsidiaries and other state income tax receivables.

18. Segment Information

The Company has three business segments: Individual Markets, Retirement Services and Other. The Individual Markets segment distributes life insurance and individual annuity products to both individuals and businesses through various distribution channels. Life insurance products in-force include participating and non-participating term life, whole life, universal life and variable universal life. The Retirement Services segment provides enrollment services, communication materials, various investment options and education services to employer-sponsored defined contribution and voluntary 403(b) plans, as well as comprehensive administrative and record-keeping services for financial institutions and employers. The Company’s Other segment includes corporate items not directly allocated to any of its other business segments, interest expense on long-term debt and the activities of a wholly owned subsidiary whose sole business is the assumption of a certain block of term life insurance from an affiliated company. The Company’s reportable segments are strategic business units that offer different products and services. They are managed separately as each segment has its own unique distribution channels.

On January 1, 2007, the Company’s business segments were redefined from prior periods whereby the Individual Markets and Retirement Services segments (formerly combined as the Company’s Financial Services segment) were identified and reported separately. As discussed in Note 2, substantially all of the Company’s former Healthcare segment has been reclassified as discontinued operations and, accordingly, is no longer reported as a separate business segment. The Company will retain a small portion of its Healthcare business and will report it within its Individual Markets segment. The segment reporting for prior periods has been restated to reflect these changes in business segments.

The accounting policies of each of the business segments are the same as those described in Note 1. The Company evaluates performance of its reportable segments based on their profitability from operations after income taxes. All material inter-segment transactions and balances have been eliminated in consolidation.

The Company’s operations are not materially dependent on one or a few customers, brokers or agents.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following tables summarize segment financial information for the year ended and as of December 31, 2007:


	Year Ended December 31, 2007

	Individual Markets			Retirement Services		Other			Total

Revenue:
Premium income	($	1,027,417	)	$	4,729	$	165,421		($	857,267	)
Fee income		69,535			388,959		4,771			463,265
Net investment income		759,037			350,382		30,122			1,139,541
Net realized gains on investments		(8,081	)		4,885		1,168			(2,028	)

Total revenue		(206,926	)		748,955		201,482			743,511

Benefits and expenses:
Benefits		(577,592	)		224,413		128,315			(224,864	)
Expenses		190,721			338,677		80,311			609,709

Total benefits and expenses		(386,871	)		563,090		208,626			384,845

Net operating income (loss) before income taxes		179,945			185,865		(7,144	)		358,666
Income taxes		59,863			58,474		454			118,791

Net income (loss) from continuing operations	$	120,082		$	127,391	($	7,598	)	$	239,875


	December 31, 2007

	Individual Markets		Retirement Services		Other		Total

Assets:
Investments	$	11,157,282	$	5,899,077	$	2,326,324	$	19,382,683
Other assets		1,204,911		637,061		251,227		2,093,199
Separate account assets		4,607,371		13,482,613		—		18,089,984

Assets from continuing operations		16,969,564		20,018,751		2,577,551		39,565,866
Assets from discontinued operations								724,766

Total assets	$	16,969,564	$	20,018,751	$	2,577,551	$	40,290,632

The following tables summarize segment financial information for the year ended and as of December 31, 2006:


	Year Ended December 31, 2006

	Individual Markets			Retirement Services			Other			Total

Revenue:
Premium income	$	446,662		$	10,661		$	125,129		$	582,452
Fee income		42,780			293,784			4,808			341,372
Net investment income		766,350			304,139			39,647			1,110,136
Net realized gains on investments		(3,561	)		(5,105	)		(799	)		(9,465	)

Total revenue		1,252,231			603,479			168,785			2,024,495

Benefits and expenses:
Benefits		1,010,613			194,928			115,180			1,320,721
Expenses		100,845			274,223			72,061			447,129

Total benefits and expenses		1,111,458			469,151			187,241			1,767,850

Net operating income (loss) before income taxes		140,773			134,328			(18,456	)		256,645
Income taxes		48,648			30,181			(6,226	)		72,603

Net income (loss) from continuing operations	$	92,125		$	104,147		($	12,230	)	$	184,042

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)


	December 31, 2006

	Individual Markets		Retirement Services		Other		Total

Assets:
Investments	$	12,443,617	$	6,243,185	$	3,097,773	$	21,784,575
Other assets		1,492,304		748,715		371,501		2,612,520
Separate account assets		3,803,591		12,486,383		—		16,289,974

Assets from continuing operations		17,739,512		19,478,283		3,469,274		40,687,069
Assets from discontinued operations								794,785

Total assets	$	17,739,512	$	19,478,283	$	3,469,274	$	41,481,854

The following tables summarize segment financial information for the year ended December 31, 2005:


	Year Ended December 31, 2005

	Individual Markets		Retirement Services		Other			Total

Revenue:
Premium income	$	473,071	$	6,277	$	166,688		$	646,036
Fee income		40,174		258,064		4,723			302,961
Net investment income		754,377		277,121		12,583			1,044,081
Net realized gains on investments		16,334		7,059		(4,696	)		18,697

Total revenue		1,283,956		548,521		179,298			2,011,775

Benefits and expenses:
Benefits		1,052,039		185,714		166,337			1,404,090
Expenses		99,692		237,214		23,099			360,005

Total benefits and expenses		1,151,731		422,928		189,436			1,764,095

Net operating income (loss) before income taxes		132,225		125,593		(10,138	)		247,680
Income taxes		37,152		32,161		(2,768	)		66,545

Net income (loss) from continuing operations	$	95,073	$	93,432	($	7,370	)	$	181,135

19. Share-Based Compensation

Lifeco, of which the Company is an indirect wholly-owned subsidiary, has a stock option plan (the “Lifeco plan”) that provides for the granting of options on its common shares to certain of its officers and employees and those of its subsidiaries, including the Company. Options are granted with exercise prices not less than the market price of the shares on the date of the grant. Termination of employment prior to the vesting of the options results in the forfeiture of the unvested options. The Lifeco plan provides for the granting of options with varying terms and vesting requirements. Generally, options under the Lifeco plan vest and become exercisable twenty percent per year commencing on the first anniversary of the grant and expire ten years from the date of grant.

The Company adopted the provisions of SFAS No. 123R on January 1, 2006, applying the modified prospective transition method of adoption; accordingly, the results of prior years have not been restated. Prior to January 1, 2006, the Company accounted for share-based payment awards under the recognition and measurement provisions of APB No. 25 and the related interpretations, as permitted by SFAS No. 123. During the years ended December 31, 2007 and 2006, the Company recognized $3,816 and $4,525, respectively, in its consolidated statements of income related to share-based compensation expense which is included in general insurance expenses in the consolidated statements of income. No share-based compensation cost was recognized in the consolidated statement of income during the year ended December 31, 2005 since the stock options granted prior to adoption of SFAS No. 123R had exercise prices equal to the market value of the underlying Lifeco common stock on the date of grant.

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

Under the modified prospective transition method, share-based compensation cost related to the unvested portion of awards outstanding at the time of adoption of SFAS No. 123R is recognized in earnings rateably over the future vesting periods of the awards. For share-based compensation awards that are granted or modified after the adoption of SFAS No. 123R, compensation cost is recognized in earnings using the accelerated attribution method permitted under SFAS No. 123R.

The Lifeco plan contains a provision that permits a retiring option holder with unvested stock options on the date of retirement to continue to vest in them post retirement for a period of up to five years. Upon the retirement of an option holder with unvested options, the Company accelerates the recognition period to the date of retirement for any unrecognized share-based compensation cost related thereto and recognizes it in its earnings at that time. At December 31, 2007, the Company had $6,663, net of estimated forfeitures, of unrecognized share-based compensation costs, which will be recognized in its earnings through 2014. The weighted average period over which these costs will be recognized in earnings is 2.3 years.

The following table summarizes the status of, and changes in, the Lifeco plan options granted to Company employees which are outstanding at December 31, 2007. The options granted relate to stock traded in Canadian dollars on the Toronto Stock Exchange, therefore, the amounts, which are presented in United States dollars, will fluctuate as a result of exchange rate fluctuations.


			Weighted Average

	Shares Under Option		Exercise Price (Whole Dollars)			Remaining Contractual Term (Years)		Aggregate Intrinsic Value ¹

Outstanding, January 1, 2007	4,906,603			$	14.82
Granted	760,000				37.50
Exercised	(1,118,492	)			13.47

Outstanding, December 31, 2007	4,548,111				21.85		4.9	$	64,034


Vested and expected to vest, December 31, 2007	4,480,821			$	21.78		4.9	$	63,422

Exercisable, December 31, 2007	3,115,211			$	16.96		4.0	$	59,107

¹ The aggregate intrinsic value is calculated as the difference between the market price of Lifeco common shares on December 31, 2007 and the exercise price of the option multiplied by the number of options.

The following table illustrates the proforma effect on net income for the year ended December 31, 2005 as if the Company had applied the fair value recognition provisions of SFAS No. 123 to stock-based employee compensation:


	Year Ended December 31, 2005

Net income, as reported		$	371,555
Less: compensation for fair value of stock options, net of related income tax effect			(3,061	)

Proforma net income		$	368,494

As a result of adopting SFAS No. 123R, the Company’s income before income taxes and net income were lower by $3,816 and $3,366, respectively, for the year ended December 31, 2007 and by $4,525 and $4,038, respectively, for the year ended December 31, 2006 than if it had continued to account for share-based compensation under APB No. 25. The adoption of SFAS No. 123R did not have an effect on the Company’s cash flow. The cash proceeds from the exercise of stock options are received and retained by Lifeco.

100

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The following table presents other information regarding options under the Lifeco plan during the year ended December 31, 2007:

¹ The intrinsic value of options exercised is calculated as the difference between the market price of Lifeco common shares on the date of exercise and the exercise price of the option multiplied by the number of options exercised.

The fair value of each option granted during the year was estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:


Dividend yield	2.84	%
Expected volitility	19.06	%
Risk free interest rate	4.02	%
Expected duration (years)	7.9

20. Obligations Relating to Debt and Leases

The Company enters into operating leases primarily for the rental of office space. The following table shows, as of December 31, 2007, scheduled related party debt principal repayments and minimum annual rental commitments for operating leases having initial or remaining non-cancelable lease terms in excess of one year during the years ended December 31, 2008 through 2012 and thereafter:


Year Ended December 31,	Related Party Notes		Operating Leases		Total Contractual Obligations

2008	$	—	$	26,481	$	26,481
2009		—		26,534		26,534
2010		—		12,011		12,011
2011		—		3,780		3,780
2012		—		2,254		2,254
Thereafter		528,400		—		528,400

21. Commitments and Contingencies

The Company is involved in various legal proceedings that arise in the ordinary course of its business. In the opinion of management, after consultation with counsel, the resolution of these proceedings are not expected to have a material adverse effect on the Company’s consolidated financial position or the results of its operations.

The Company has entered into a corporate credit facility agreement in the amount of $50,000 for general corporate purposes. The credit facility matures on May 26, 2010. Interest accrues at a rate dependent upon various conditions and terms of borrowings. The agreement requires the Company to maintain a minimum adjusted net worth of $900,000 plus 50% of its net income, if positive (both compiled by the unconsolidated statutory accounting basis prescribed by the National Association of Insurance Commissioners), for each quarter ending after March 31, 2005. The Company had no borrowings under the credit facility at either December 31, 2007 or 2006 and was in compliance with all covenants.

101

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Notes to Consolidated Financial Statements
Years Ended December 31, 2007, 2006 and 2005
(Dollars in Thousands, Except Share Amounts)

The Company makes commitments to fund partnership interests and other investments in the normal course of its business. The amounts of these unfunded commitments at December 31, 2007 and 2006 were $97,201 and $65,267, respectively, all of which is due within one year from the dates indicated.

In connection with certain acquisitions, the Company agreed to pay additional consideration in future periods, based upon the attainment by the acquired entity of defined operating objectives. The contingent consideration obligations are not considered contractual obligations and are not accrued for prior to the attainment of the objectives. Any such contingent payments will be considered as additional purchase consideration and will result in an adjustment to the purchase price allocation in the period in which the contingency is resolved.

102

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
Schedule III
Supplemental Insurance Information
(In Thousands)


	As of and for the year ended December 31, 2007

Operations:	Individual Markets			Retirement Services		Other		Total

Deferred acquisition costs	$	143,839		$	252,984	$	—	$	396,823
Future policy benefits, losses, claims and expenses		11,044,711			5,990,779		277,220		17,312,710
Unearned premium reserves		63,985			—		—		63,985
Other policy claims and benefits payable		852,505			267		—		852,772
Premium income		(1,027,417	)		4,729		165,421		(857,267	)
Net investment income		759,037			350,382		30,122		1,139,541
Benefits, claims, losses and settlement expenses		(577,592	)		224,413		128,315		(224,864	)
Amortization of deferred acquisition costs		104,345			24,230		—		128,575
Other operating expenses		86,376			314,447		80,311		481,134

	As of and for the year ended December 31, 2006

Operations:	Individual Markets			Retirement Services		Other		Total

Deferred acquisition costs	$	217,735		$	233,480	$	—	$	451,215
Future policy benefits, losses, claims and expenses		12,840,101			6,067,691		221,092		19,128,884
Unearned premium reserves		58,687			—		—		58,687
Other policy claims and benefits payable		879,971			76		—		880,047
Premium income		446,662			10,661		125,129		582,452
Net investment income		766,350			304,139		39,647		1,110,136
Benefits, claims, losses and settlement expenses		1,010,613			194,928		115,180		1,320,721
Amortization of deferred acquisition costs		23,785			20,739		—		44,524
Other operating expenses		77,060			253,484		72,061		402,605

	For the year ended December 31, 2005

Operations:	Individual Markets			Retirement Services		Other		Total

Premium income	$	473,071		$	6,277	$	166,688	$	646,036
Net investment income		754,377			277,121		12,583		1,044,081
Benefits, claims, losses and settlement expenses		1,052,039			185,714		166,337		1,404,090
Amortization of deferred acquisition costs		26,824			24,482		—		51,306
Other operating expenses		72,868			212,732		23,099		308,699

103


Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure


	There has been no change in the Company’s independent registered public accounting firm nor have there been any disagreements on accounting or financial disclosure matters.


Item 9A.	Controls and Procedures


	The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles.

	Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

	Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2007. In making this evaluation, management used criteria set forth in Internal Control – Integrated Framework issued by the committee of Sponsoring Organizations of the Treadway Commission. Based on their evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s internal control over financial reporting is effective as of December 31, 2007.

	The Chief Executive Officer and Chief Financial Officer hereby confirm that there were no changes in the Company’s internal control over financial reporting during the fourth quarter of 2007 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Variable Annuity -1 Series
Account of Great-West Life
& Annuity Insurance
Company

Financial Statements for the Years Ended
December 31, 2007 and 2006
and Report of Independent Registered Public
Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Contract Owners of
Variable Annuity -1 Series Account of
Great-West Life & Annuity Insurance Company

We have audited the accompanying statements of assets and liabilities of Variable Annuity -1 Series Account of Great-West Life & Annuity Insurance Company (the “Series Account”) as of December 31, 2007, by investment division, and the related statements of operations for the year then ended, by investment division, the statements of changes in net assets for each of the two years in the period then ended, by investment division, and the financial highlights included in Note 5 for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Series Account’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Series Account is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Series Account’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2007, by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Variable Annuity -1 Series Account of Great-West Life & Annuity Insurance Company as of December 31, 2007, by investment division, the results of its operations for the year then ended, by investment division, the changes in its net assets for each of the two years in the period then ended, by investment division, and the financial highlights for each of the five years in the period then ended, by investment division, in conformity with accounting principles generally accepted in the United States of America.

/s/ DELOITTE & TOUCHE LLP

Denver, Colorado

March 24, 2008

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		AIM V.I. CORE EQUITY FUND		AIM V.I. HIGH YIELD FUND		AIM V.I. INTERNATIONAL GROWTH FUND		AIM V.I. TECHNOLOGY FUND		ALGER AMERICAN GROWTH PORTFOLIO		ALGER AMERICAN MIDCAP GROWTH PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	8,203,282	$	5,105,109	$	2,909,117	$	4,449,369	$	20,791,788	$	6,733,743
Investment income due and accrued
Purchase payments receivable							15				1,848
Due from Great West Life & Annuity Insurance Company									387		6,199


Total assets			8,203,282		5,105,109		2,909,132		4,449,756		20,799,835		6,733,743


LIABILITIES:
Redemptions payable			201		13				20,271				16,354
Due to Great West Life & Annuity Insurance Company			961		593		341		522		2,442		791


Total liabilities			1,162		606		341		20,793		2,442		17,145


NET ASSETS		$	8,202,120	$	5,104,503	$	2,908,791	$	4,428,963	$	20,797,393	$	6,716,598


NET ASSETS REPRESENTED BY:
Accumulation units		$	8,202,120	$	5,104,503	$	2,908,791	$	4,418,868	$	20,736,105	$	6,716,598
Contracts in payout phase									10,095		61,288


NET ASSETS		$	8,202,120	$	5,104,503	$	2,908,791	$	4,428,963	$	20,797,393	$	6,716,598


ACCUMULATION UNITS OUTSTANDING			395,998		351,270		230,421		1,574,855		880,656		313,927

UNIT VALUE (ACCUMULATION)		$	20.71	$	14.53	$	12.62	$	2.81	$	23.55	$	21.40


(1)	Cost of investments:	$	6,592,660	$	5,489,980	$	2,824,430	$	4,433,608	$	16,249,693	$	6,137,518
	Shares of investments:		281,803		889,392		86,504		294,660		421,997		285,086


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		ALLIANCE- BERNSTEIN VPS GROWTH & INCOME PORTFOLIO		ALLIANCE- BERNSTEIN VPS GROWTH PORTFOLIO		ALLIANCE- BERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO		ALLIANCE- BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO		ALLIANCE- BERNSTEIN VPS SMALL/MIDCAP VALUE PORTFOLIO		ALLIANCE- BERNSTEIN VPS UTILITY INCOME PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	1,318,787	$	898,666	$	11,323,827	$	7,607,671	$	1,199,484	$	5,022,954
Investment income due and accrued
Purchase payments receivable			205				1,258						7,247
Due from Great West Life & Annuity Insurance Company													6,698


Total assets			1,318,992		898,666		11,325,085		7,607,671		1,199,484		5,036,899


LIABILITIES:
Redemptions payable									187		154
Due to Great West Life & Annuity Insurance Company			157		106		1,327		889		141		588


Total liabilities			157		106		1,327		1,076		295		588


NET ASSETS		$	1,318,835	$	898,560	$	11,323,758	$	7,606,595	$	1,199,189	$	5,036,311


NET ASSETS REPRESENTED BY:
Accumulation units		$	1,318,835	$	898,560	$	11,323,758	$	7,606,595	$	1,199,189	$	5,004,903
Contracts in payout phase													31,408


NET ASSETS		$	1,318,835	$	898,560	$	11,323,758	$	7,606,595	$	1,199,189	$	5,036,311


ACCUMULATION UNITS OUTSTANDING			113,600		80,877		629,566		642,716		113,576		218,552

UNIT VALUE (ACCUMULATION)		$	11.61	$	11.11	$	17.99	$	11.84	$	10.56	$	22.90


(1)	Cost of investments:	$	1,358,139	$	871,014	$	12,902,955	$	7,645,834	$	1,399,966	$	4,330,821
	Shares of investments:		49,172		39,226		454,955		302,612		70,104		168,952


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		AMERICAN CENTURY VP BALANCED FUND		AMERICAN CENTURY VP INTERNATIONAL FUND		AMERICAN CENTURY VP VALUE FUND		DELAWARE VIP GROWTH OPPORTUNITIES SERIES		DELAWARE VIP SMALL CAP VALUE SERIES		DREYFUS IP MIDCAP STOCK PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	2,382,793	$	9,179,134	$	8,315,544	$	272,585	$	4,809,160	$	1,166,870
Investment income due and accrued
Purchase payments receivable													80
Due from Great West Life & Annuity Insurance Company							523


Total assets			2,382,793		9,179,134		8,316,067		272,585		4,809,160		1,166,950


LIABILITIES:
Redemptions payable			55,504		86		784		176		253
Due to Great West Life & Annuity Insurance Company			279		1,070		977		31		565		137


Total liabilities			55,783		1,156		1,761		207		818		137


NET ASSETS		$	2,327,010	$	9,177,978	$	8,314,306	$	272,378	$	4,808,342	$	1,166,813


NET ASSETS REPRESENTED BY:
Accumulation units		$	2,327,010	$	9,177,978	$	8,309,490	$	272,378	$	4,808,342	$	1,166,813
Contracts in payout phase							4,816


NET ASSETS		$	2,327,010	$	9,177,978	$	8,314,306	$	272,378	$	4,808,342	$	1,166,813


ACCUMULATION UNITS OUTSTANDING			166,561		370,098		548,064		24,872		278,630		75,449

UNIT VALUE (ACCUMULATION)		$	13.97	$	24.80	$	15.16	$	10.95	$	17.26	$	15.46


(1)	Cost of investments:	$	2,356,260	$	5,861,390	$	9,012,208	$	285,513	$	5,231,137	$	1,249,614
	Shares of investments:		325,074		773,957		1,113,192		12,761		167,859		75,185


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		DREYFUS VIF APPRECIATION PORTFOLIO		DREYFUS VIF DEVELOPING LEADERS PORTFOLIO		DREYFUS VIF GROWTH & INCOME PORTFOLIO		DWS BLUE CHIP VIP PORTFOLIO		DWS CAPITAL GROWTH VIP PORTFOLIO		DWS DREMAN HIGH RETURN EQUITY VIP PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	7,579,974	$	140,355	$	2,524,570	$	1,129,327	$	2,568,961	$	4,386,581
Investment income due and accrued							3,276
Purchase payments receivable									3,660
Due from Great West Life & Annuity Insurance Company			11,687								4,598


Total assets			7,591,661		140,355		2,527,846		1,132,987		2,573,559		4,386,581


LIABILITIES:
Redemptions payable			36				536				610		32
Due to Great West Life & Annuity Insurance Company			892		17		297		134		302		513


Total liabilities			928		17		833		134		912		545


NET ASSETS		$	7,590,733	$	140,338	$	2,527,013	$	1,132,853	$	2,572,647	$	4,386,036


NET ASSETS REPRESENTED BY:
Accumulation units		$	7,441,145	$	140,338	$	2,527,013	$	1,132,853	$	2,532,454	$	4,386,036
Contracts in payout phase			149,588								40,193


NET ASSETS		$	7,590,733	$	140,338	$	2,527,013	$	1,132,853	$	2,572,647	$	4,386,036


ACCUMULATION UNITS OUTSTANDING			625,089		11,188		213,391		102,435		228,407		354,883

UNIT VALUE (ACCUMULATION)		$	11.90	$	12.54	$	11.84	$	11.06	$	11.09	$	12.36


(1)	Cost of investments:	$	5,838,320	$	175,136	$	2,028,987	$	1,156,634	$	2,014,178	$	4,360,135
	Shares of investments:		168,970		4,340		99,275		77,087		125,868		304,624


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO		DWS GROWTH & INCOME VIP PORTFOLIO		DWS HEALTH CARE VIP PORTFOLIO		DWS LARGE CAP VALUE VIP PORTFOLIO		DWS SMALL CAP INDEX VIP PORTFOLIO		FEDERATED AMERICAN LEADERS FUND II

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	1,341,206	$	734,854	$	1,137,081	$	857,716	$	9,195,388	$	8,838,016
Investment income due and accrued
Purchase payments receivable							1,441
Due from Great West Life & Annuity Insurance Company											531		3,410


Total assets			1,341,206		734,854		1,138,522		857,716		9,195,919		8,841,426


LIABILITIES:
Redemptions payable			13						131		2,132		1,737
Due to Great West Life & Annuity Insurance Company			157		86		134		99		1,082		1,035


Total liabilities			170		86		134		230		3,214		2,772


NET ASSETS		$	1,341,036	$	734,768	$	1,138,388	$	857,486	$	9,192,705	$	8,838,654


NET ASSETS REPRESENTED BY:
Accumulation units		$	1,341,036	$	734,768	$	1,138,388	$	857,486	$	9,187,816	$	8,792,864
Contracts in payout phase											4,889		45,790


NET ASSETS		$	1,341,036	$	734,768	$	1,138,388	$	857,486	$	9,192,705	$	8,838,654


ACCUMULATION UNITS OUTSTANDING			123,867		73,752		94,811		63,813		522,916		459,059

UNIT VALUE (ACCUMULATION)		$	10.83	$	9.96	$	12.01	$	13.44	$	17.57	$	19.15


(1)	Cost of investments:	$	1,434,728	$	662,962	$	1,113,095	$	827,468	$	8,390,447	$	9,722,964
	Shares of investments:		66,660		67,979		77,458		44,649		625,111		515,938


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		FEDERATED CAPITAL INCOME FUND II		FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II		FRANKLIN SMALL CAP VALUE SECURITIES FUND		JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES		JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	814,893	$	30,796,538	$	515,065	$	4,289,933	$	1,386,561	$	18,410,412
Investment income due and accrued
Purchase payments receivable					959						70,409
Due from Great West Life & Annuity Insurance Company					7,761								5,327


Total assets			814,893		30,805,258		515,065		4,289,933		1,456,970		18,415,739


LIABILITIES:
Redemptions payable			10						10				137
Due to Great West Life & Annuity Insurance Company			95		3,561		60		498		161		2,129


Total liabilities			105		3,561		60		508		161		2,266


NET ASSETS		$	814,788	$	30,801,697	$	515,005	$	4,289,425	$	1,456,809	$	18,413,473


NET ASSETS REPRESENTED BY:
Accumulation units		$	814,788	$	30,715,642	$	515,005	$	4,289,425	$	1,456,809	$	18,341,935
Contracts in payout phase					86,055								71,538


NET ASSETS		$	814,788	$	30,801,697	$	515,005	$	4,289,425	$	1,456,809	$	18,413,473


ACCUMULATION UNITS OUTSTANDING			60,680		1,880,992		52,226		289,887		139,803		1,238,890

UNIT VALUE (ACCUMULATION)		$	13.43	$	16.33	$	9.86	$	14.80	$	10.42	$	14.81


(1)	Cost of investments:	$	710,797	$	30,357,954	$	560,486	$	3,886,974	$	1,376,711	$	19,211,405
	Shares of investments:		84,708		2,670,992		30,121		142,760		44,613		1,606,493


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES		JANUS ASPEN GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES		JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO INSTITUTIONAL SHARES		JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO SERVICE SHARES		JANUS ASPEN LARGE CAP GROWTH PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	2,550,692	$	3,113,538	$	1,120,730	$	28,858,965	$	5,863,296	$	12,979,862
Investment income due and accrued
Purchase payments receivable			431
Due from Great West Life & Annuity Insurance Company									5,452				4,288


Total assets			2,551,123		3,113,538		1,120,730		28,864,417		5,863,296		12,984,150


LIABILITIES:
Redemptions payable					6		50		683		22,031		7,020
Due to Great West Life & Annuity Insurance Company			295		365		131		3,345		681		1,518


Total liabilities			295		371		181		4,028		22,712		8,538


NET ASSETS		$	2,550,828	$	3,113,167	$	1,120,549	$	28,860,389	$	5,840,584	$	12,975,612


NET ASSETS REPRESENTED BY:
Accumulation units		$	2,550,828	$	3,113,167	$	1,120,549	$	28,818,203	$	5,840,584	$	12,938,128
Contracts in payout phase									42,186				37,484


NET ASSETS		$	2,550,828	$	3,113,167	$	1,120,549	$	28,860,389	$	5,840,584	$	12,975,612


ACCUMULATION UNITS OUTSTANDING			244,864		192,696		109,725		941,230		490,829		663,980

UNIT VALUE (ACCUMULATION)		$	10.42	$	16.16	$	10.21	$	30.62	$	11.90	$	19.49


(1)	Cost of investments:	$	2,503,944	$	2,837,605	$	1,140,941	$	20,779,162	$	6,035,700	$	12,086,626
	Shares of investments:		210,280		156,538		56,036		441,877		90,890		491,289


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO		LVIP BARON GROWTH OPPORTUNITIES PORTFOLIO		NEUBERGER BERMAN AMT REGENCY PORTFOLIO		NVIT MID CAP INDEX FUND		OPPENHEIMER GLOBAL SECURITIES FUND/VA		PIMCO VIT HIGH YIELD PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	14,545,747	$	13,747,242	$	237,330	$	3,544,665	$	16,088,746	$	6,032,984
Investment income due and accrued													39,157
Purchase payments receivable									41		404		12,651
Due from Great West Life & Annuity Insurance Company			7,536		5,099						8,859


Total assets			14,553,283		13,752,341		237,330		3,544,706		16,098,009		6,084,792


LIABILITIES:
Redemptions payable			7,556		1,932
Due to Great West Life & Annuity Insurance Company			1,699		1,614		26		417		1,886		704


Total liabilities			9,255		3,546		26		417		1,886		704


NET ASSETS		$	14,544,028	$	13,748,795	$	237,304	$	3,544,289	$	16,096,123	$	6,084,088


NET ASSETS REPRESENTED BY:
Accumulation units		$	14,456,363	$	13,680,320	$	237,304	$	3,544,289	$	15,977,163	$	6,084,088
Contracts in payout phase			87,665		68,475						118,960


NET ASSETS		$	14,544,028	$	13,748,795	$	237,304	$	3,544,289	$	16,096,123	$	6,084,088


ACCUMULATION UNITS OUTSTANDING			677,485		678,775		22,743		199,822		749,591		451,295

UNIT VALUE (ACCUMULATION)		$	21.34	$	20.15	$	10.43	$	17.74	$	21.31	$	13.48


(1)	Cost of investments:	$	9,285,533	$	11,865,346	$	257,839	$	3,389,096	$	14,216,699	$	6,152,627
	Shares of investments:		411,711		459,098		13,663		185,487		439,583		749,439


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		PIMCO VIT LOW DURATION BOND PORTFOLIO		PIMCO VIT TOTAL RETURN PORTFOLIO		PIONEER FUND VCT PORTFOLIO		PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO		PIONEER MID CAP VALUE VCT PORTFOLIO		PIONEER SMALL CAP VALUE VCT PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	15,800,004	$	15,292,932	$	4,355,508	$	4,971,256	$	268,531	$	2,761,182
Investment income due and accrued			59,738		58,654
Purchase payments receivable			24,610								10
Due from Great West Life & Annuity Insurance Company			8,515						5,051				6,315


Total assets			15,892,867		15,351,586		4,355,508		4,976,307		268,541		2,767,497


LIABILITIES:
Redemptions payable					8,897		4,051		3,513				505
Due to Great West Life & Annuity Insurance Company			1,842		1,769		511		586		31		326


Total liabilities			1,842		10,666		4,562		4,099		31		831


NET ASSETS		$	15,891,025	$	15,340,920	$	4,350,946	$	4,972,208	$	268,510	$	2,766,666


NET ASSETS REPRESENTED BY:
Accumulation units		$	15,776,674	$	15,340,920	$	4,350,946	$	4,961,728	$	268,510	$	2,755,793
Contracts in payout phase			114,351						10,480				10,873


NET ASSETS		$	15,891,025	$	15,340,920	$	4,350,946	$	4,972,208	$	268,510	$	2,766,666


ACCUMULATION UNITS OUTSTANDING			1,427,719		1,373,045		280,297		351,884		24,191		158,094

UNIT VALUE (ACCUMULATION)		$	11.05	$	11.17	$	15.52	$	14.10	$	11.10	$	17.43


(1)	Cost of investments:	$	15,564,500	$	14,799,781	$	3,622,554	$	5,360,252	$	279,920	$	3,461,188
	Shares of investments:		1,533,981		1,457,858		169,343		221,535		14,037		212,890


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		PRUDENTIAL SERIES FUND EQUITY PORTFOLIO		SCHWAB MARKETTRACK GROWTH PORTFOLIO II		SCHWAB MONEY MARKET PORTFOLIO		SCHWAB S&P 500 INDEX PORTFOLIO		THIRD AVENUE VALUE PORTFOLIO		UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO

Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	1,106,266	$	14,416,633	$	65,170,615	$	79,519,728	$	3,531,663	$	11,696,978
Investment income due and accrued							328,170
Purchase payments receivable			8				408,603
Due from Great West Life & Annuity Insurance Company							66,925		52,784				9,092


Total assets			1,106,274		14,416,633		65,974,313		79,572,512		3,531,663		11,706,070


LIABILITIES:
Redemptions payable					40,351				12,041		50		45,953
Due to Great West Life & Annuity Insurance Company			129		1,685		7,604		9,330		414		1,365


Total liabilities			129		42,036		7,604		21,371		464		47,318


NET ASSETS		$	1,106,145	$	14,374,597	$	65,966,709	$	79,551,141	$	3,531,199	$	11,658,752


NET ASSETS REPRESENTED BY:
Accumulation units		$	1,106,145	$	14,374,597	$	65,762,401	$	79,296,334	$	3,531,199	$	11,646,416
Contracts in payout phase							204,308		254,807				12,336


NET ASSETS		$	1,106,145	$	14,374,597	$	65,966,709	$	79,551,141	$	3,531,199	$	11,658,752


ACCUMULATION UNITS OUTSTANDING			87,717		674,092		4,866,328		3,628,132		362,784		401,003

UNIT VALUE (ACCUMULATION)		$	12.61	$	21.32	$	13.51	$	21.86	$	9.73	$	29.04


(1)	Cost of investments:	$	936,260	$	12,139,459	$	65,170,615	$	62,713,900	$	4,047,903	$	13,442,536
	Shares of investments:		37,148		811,747		65,170,615		3,721,092		136,252		530,475


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 2007


		VAN KAMPEN LIT COMSTOCK		VAN KAMPEN LIT GROWTH & INCOME		WELLS FARGO ADVANTAGE VT MULTI CAP VALUE FUND		WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND		TOTAL SCHWAB SELECT ANNUITY

										(Memoranda Only)
Schwab Select Annuity:

ASSETS:
Investments at market value (1)		$	892,486	$	2,461,911	$	5,551,836	$	584,542	$	535,403,182
Investment income due and accrued											488,995
Purchase payments receivable											533,880
Due from Great West Life & Annuity Insurance Company							5,385				232,422


Total assets			892,486		2,461,911		5,557,221		584,542		536,658,479


LIABILITIES:
Redemptions payable					77		12,215		39		266,337
Due to Great West Life & Annuity Insurance Company			105		288		645		69		62,549


Total liabilities			105		365		12,860		108		328,886


NET ASSETS		$	892,381	$	2,461,546	$	5,544,361	$	584,434	$	536,329,593


NET ASSETS REPRESENTED BY:
Accumulation units		$	892,381	$	2,461,546	$	5,462,258	$	584,434	$	534,779,905
Contracts in payout phase							82,103				1,549,688


NET ASSETS		$	892,381	$	2,461,546	$	5,544,361	$	584,434	$	536,329,593


ACCUMULATION UNITS OUTSTANDING			75,106		190,221		362,468		53,096

UNIT VALUE (ACCUMULATION)		$	11.88	$	12.94	$	15.07	$	11.01


(1)	Cost of investments:	$	904,810	$	2,410,388	$	5,302,964	$	644,984	$	489,415,253
	Shares of investments:		64,393		115,258		501,068		26,534


The accompanying notes are an integral part of these financial statements.	(Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2007


	AIM V.I. CORE EQUITY FUND			AIM V.I. HIGH YIELD FUND			AIM V.I. INTERNATIONAL GROWTH FUND			AIM V.I. TECHNOLOGY FUND			ALGER AMERICAN GROWTH PORTFOLIO			ALGER AMERICAN MIDCAP GROWTH PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	92,420		$	378,836		$	11,565		$			$	59,449		$	1

EXPENSES:
Mortality and expense risk		76,164			49,900			19,587			35,698			152,387			34,963


NET INVESTMENT INCOME (LOSS)		16,256			328,936			(8,022	)		(35,698	)		(92,938	)		(34,962	)


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		394,656			23,026			288,088			481,711			645,878			(46,228	)
Realized gain distributions																	437,730


Net realized gain		394,656			23,026			288,088			481,711			645,878			391,502


Change in net unrealized appreciation (depreciation) on investments		251,137			(301,563	)		(38,714	)		(294,519	)		2,492,737			666,259


NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	662,049		$	50,399		$	241,352		$	151,494		$	3,045,677		$	1,022,799


INVESTMENT INCOME RATIO (2007)		1.03	%		6.46	%		0.50	%					0.33	%		0.00	%


INVESTMENT INCOME RATIO (2006)		1.66	%		7.83	%		1.77	%					0.13	%


INVESTMENT INCOME RATIO (2005)		0.39	%		7.22	%								0.24	%


INVESTMENT INCOME RATIO (2004)		0.76	%		14.63	%


INVESTMENT INCOME RATIO (2003)		1.09	%		5.97	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2007


	ALLIANCE- BERNSTEIN VPS GROWTH & INCOME PORTFOLIO			ALLIANCE- BERNSTEIN VPS GROWTH PORTFOLIO			ALLIANCE- BERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO			ALLIANCE- BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO			ALLIANCE- BERNSTEIN VPS SMALL/MIDCAP VALUE PORTFOLIO			ALLIANCE- BERNSTEIN VPS UTILITY INCOME PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	19,938		$			$	183,310		$	90,514		$	18,196		$	127,728

EXPENSES:
Mortality and expense risk		9,964			6,457			84,512			64,815			11,875			42,471


NET INVESTMENT INCOME (LOSS)		9,974			(6,457	)		98,798			25,699			6,321			85,257


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		9,112			35,724			807,078			574,731			(7,763	)		655,433
Realized gain distributions		67,671						3,490,045			299,346			134,565			4,293


Net realized gain		76,783			35,724			4,297,123			874,077			126,802			659,726


Change in net unrealized appreciation (depreciation) on investments		(59,709	)		20,412			(2,933,054	)		(653,338	)		(229,209	)		149,843


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	27,048		$	49,679		$	1,462,867		$	246,438		$	(96,086	)	$	894,826


INVESTMENT INCOME RATIO (2007)		1.70	%					1.84	%		1.19	%		1.30	%		2.55	%


INVESTMENT INCOME RATIO (2006)		0.90	%					0.94	%		0.59	%		0.00	%		2.19	%


INVESTMENT INCOME RATIO (2005)								0.01	%								1.80	%


INVESTMENT INCOME RATIO (2004)																	1.50	%


INVESTMENT INCOME RATIO (2003)																	0.12	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2007


	AMERICAN CENTURY VP BALANCED FUND			AMERICAN CENTURY VP INTERNATIONAL FUND			AMERICAN CENTURY VP VALUE FUND			DELAWARE VIP GROWTH OPPORTUNITIES SERIES			DELAWARE VIP SMALL CAP VALUE SERIES			DREYFUS IP MIDCAP STOCK PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	54,316		$	65,317		$	157,589		$			$	32,773		$	6,273

EXPENSES:
Mortality and expense risk		22,166			79,553			84,093			1,426			53,778			12,264


NET INVESTMENT INCOME (LOSS)		32,150			(14,236	)		73,496			(1,426	)		(21,005	)		(5,991	)


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		21,355			884,747			74,054			(15,978	)		185,062			(124,429	)
Realized gain distributions		132,245						817,208						520,671			178,211


Net realized gain (loss)		153,600			884,747			891,262			(15,978	)		705,733			53,782


Change in net unrealized appreciation (depreciation) on investments		(83,367	)		611,789			(1,520,339	)		(13,325	)		(1,082,099	)		(27,639	)


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	102,383		$	1,482,300		$	(555,581	)	$	(30,729	)	$	(397,371	)	$	20,152


INVESTMENT INCOME RATIO (2007)		2.08	%		0.70	%		1.59	%					0.52	%		0.43	%


INVESTMENT INCOME RATIO (2006)		1.90	%		1.85	%		1.38	%					0.26	%		0.40	%


INVESTMENT INCOME RATIO (2005)		1.56	%		1.08	%		0.76	%					0.36	%		0.03	%


INVESTMENT INCOME RATIO (2004)		1.13	%		0.57	%		0.74	%					0.20	%		0.45	%


INVESTMENT INCOME RATIO (2003)					0.72	%											0.76	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2007


	DREYFUS VIF APPRECIATION PORTFOLIO			DREYFUS VIF DEVELOPING LEADERS PORTFOLIO			DREYFUS VIF GROWTH & INCOME PORTFOLIO			DWS BLUE CHIP VIP PORTFOLIO			DWS CAPITAL GROWTH VIP PORTFOLIO			DWS DREMAN HIGH RETURN EQUITY VIP PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	122,581		$	1,474		$	19,668		$	9,131		$	16,027		$	71,380

EXPENSES:
Mortality and expense risk		66,138			1,579			22,499			7,926			21,634			41,307


NET INVESTMENT INCOME (LOSS)		56,443			(105	)		(2,831	)		1,205			(5,607	)		30,073


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		473,008			(3,708	)		200,285			(11,190	)		178,139			161,519
Realized gain distributions					25,774			122,175			96,857						41,363


Net realized gain		473,008			22,066			322,460			85,667			178,139			202,882


Change in net unrealized appreciation (depreciation) on investments		(62,080	)		(41,107	)		(124,493	)		(62,987	)		107,994			(347,789	)


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	467,371		$	(19,146	)	$	195,136		$	23,885		$	280,526		$	(114,834	)


INVESTMENT INCOME RATIO (2007)		1.58	%		0.79	%		0.74	%		0.98	%		0.63	%		1.47	%


INVESTMENT INCOME RATIO (2006)		1.59	%		0.48	%		0.76	%					0.58	%		1.56	%


INVESTMENT INCOME RATIO (2005)		0.02	%					1.35	%					0.98	%


INVESTMENT INCOME RATIO (2004)		1.65	%		0.23	%		1.27	%					0.55	%


INVESTMENT INCOME RATIO (2003)		1.43	%		0.05	%		0.85	%					0.45	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO
				DWS GROWTH & INCOME VIP PORTFOLIO			DWS HEALTH CARE VIP PORTFOLIO			DWS LARGE CAP VALUE VIP PORTFOLIO			DWS SMALL CAP INDEX VIP PORTFOLIO			FEDERATED AMERICAN LEADERS FUND II



Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	23,277		$	9,572		$			$	9,073		$	97,300		$	167,137

EXPENSES:
Mortality and expense risk		17,180			6,793			8,438			4,401			92,086			93,835


NET INVESTMENT INCOME (LOSS)		6,097			2,779			(8,438	)		4,672			5,214			73,302


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		(19,241	)		77,535			35,231			27,089			1,174,415			111,785
Realized gain distributions		336,482			10,558			56,974			18,877			713,051			1,245,301


Net realized gain		317,241			88,093			92,205			45,966			1,887,466			1,357,086


Change in net unrealized appreciation (depreciation) on investments		(238,772	)		(93,559	)		8,226			5,453			(2,097,273	)		(2,516,768	)


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	84,566		$	(2,687	)	$	91,993		$	56,091		$	(204,593	)	$	(1,086,380	)


INVESTMENT INCOME RATIO (2007)		1.15	%		1.20	%					1.75	%		0.90	%		1.52	%


INVESTMENT INCOME RATIO (2006)					1.02	%					1.07	%		0.68	%		1.59	%


INVESTMENT INCOME RATIO (2005)					1.33	%								0.66	%		1.65	%


INVESTMENT INCOME RATIO (2004)					0.86	%								0.45	%		1.43	%


INVESTMENT INCOME RATIO (2003)					0.92	%								0.89	%		1.61	%


The accompanying notes are an integral part of these financial statements.		(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	FEDERATED CAPITAL INCOME FUND II						FRANKLIN SMALL CAP VALUE SECURITIES FUND			JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES			JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES			JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES
				FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II



Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	45,055		$	1,381,524		$	3,280		$	112,069		$	23,349		$	915,602

EXPENSES:
Mortality and expense risk		7,698			266,830			4,477			39,394			5,669			168,386


NET INVESTMENT INCOME (LOSS)		37,357			1,114,694			(1,197	)		72,675			17,680			747,216


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		68,646			(226,554	)		8,374			236,219			6,735			(487,590	)
Realized gain distributions								33,726


Net realized gain (loss)		68,646			(226,554	)		42,100			236,219			6,735			(487,590	)


Change in net unrealized appreciation (depreciation) on investments		(76,419	)		738,090			(61,879	)		136,104			9,850			880,743


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	29,584		$	1,626,230		$	(20,976	)	$	444,998		$	34,265		$	1,140,369


INVESTMENT INCOME RATIO (2007)		4.98	%		4.40	%		0.62	%		2.41	%		2.34	%		4.62	%


INVESTMENT INCOME RATIO (2006)		6.13	%		4.30	%		0.10	%		2.37	%					4.69	%


INVESTMENT INCOME RATIO (2005)		5.63	%		4.18	%					2.54	%					5.20	%


INVESTMENT INCOME RATIO (2004)		4.71	%		4.71	%					3.17	%					5.54	%


INVESTMENT INCOME RATIO (2003)		6.20	%		3.95	%					3.24	%					4.39	%


The accompanying notes are an integral part of these financial statements.		(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES			GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES			JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES			INTERNATIONAL GROWTH PORTFOLIO INSTITUTIONAL SHARES			JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO SERVICE SHARES			JANUS ASPEN LARGE CAP GROWTH PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	67,493		$	70,329		$	9,561		$	188,379		$	10,949		$	94,255

EXPENSES:
Mortality and expense risk		8,753			32,531			3,695			254,372			23,909			114,215


NET INVESTMENT INCOME (LOSS)		58,740			37,798			5,866			(65,993	)		(12,960	)		(19,960	)


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		167			347,354			(12,398	)		3,924,496			694,731			(52,583	)
Realized gain distributions


Net realized gain (loss)		167			347,354			(12,398	)		3,924,496			694,731			(52,583	)



Change in net unrealized appreciation (depreciation) on investments		46,748			(78,840	)		(20,211	)		3,348,825			(172,404	)		1,862,744



NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	105,655		$	306,312		$	(26,743	)	$	7,207,328		$	509,367		$	1,790,201



INVESTMENT INCOME RATIO (2007)		4.38	%		1.84	%		1.47	%		0.63	%		0.26	%		0.70	%


INVESTMENT INCOME RATIO (2006)					1.78	%					1.83	%					0.46	%


INVESTMENT INCOME RATIO (2005)					0.80	%					1.26	%					0.32	%


INVESTMENT INCOME RATIO (2004)					0.73	%					0.88	%					0.13	%


INVESTMENT INCOME RATIO (2003)					0.18	%					1.21	%					0.08	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007



	JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO			LVIP BARON GROWTH OPPORTUNITIES PORTFOLIO			NEUBERGER BERMAN AMT REGENCY PORTFOLIO			NVIT MID CAP INDEX FUND			OPPENHEIMER GLOBAL SECURITIES FUND/VA			PIMCO VIT HIGH YIELD PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	115,635		$			$	895		$	52,145		$	234,213		$	530,804

EXPENSES:
Mortality and expense risk		132,447			140,505			2,281			36,874			144,617			64,605


NET INVESTMENT INCOME (LOSS)		(16,812	)		(140,505	)		(1,386	)		15,271			89,596			466,199


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		982,164			2,448,984			6,899			277,718			1,509,842			(3,365	)
Realized gain distributions					1,799,144			5,804			127,454			851,372


Net realized gain (loss)		982,164			4,248,128			12,703			405,172			2,361,214			(3,365	)


Change in net unrealized appreciation (depreciation) on investments		385,849			(3,566,151	)		(17,849	)		(114,694	)		(1,478,304	)		(286,810	)



NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	1,351,201		$	541,472		$	(6,532	)	$	305,749		$	972,506		$	176,024


INVESTMENT INCOME RATIO (2007)		0.74	%					0.33	%		1.20	%		1.38	%		6.99	%


INVESTMENT INCOME RATIO (2006)		1.69	%					0.08	%		0.96	%		1.06	%		6.83	%


INVESTMENT INCOME RATIO (2005)		1.29	%								0.95	%		0.94	%		6.56	%


INVESTMENT INCOME RATIO (2004)		0.96	%								0.43	%		1.28	%		6.57	%


INVESTMENT INCOME RATIO (2003)		1.09	%								0.30	%					3.98	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	PIMCO VIT LOW DURATION BOND PORTFOLIO			PIMCO VIT TOTAL RETURN PORTFOLIO			PIONEER FUND VCT PORTFOLIO			PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO			PIONEER MID CAP VALUE VCT PORTFOLIO			PIONEER SMALL CAP VALUE VCT PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	739,101		$	610,160		$	57,384		$			$	2,579		$	26,044

EXPENSES:
Mortality and expense risk		131,752			107,329			40,640			52,885			2,223			32,086


NET INVESTMENT INCOME (LOSS)		607,349			502,831			16,744			(52,885	)		356			(6,042	)


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		(83,338	)		(82,170	)		262,858			806,424			(45,456	)		(761,925	)
Realized gain distributions											862,057			46,088			852,652


Net realized gain (loss)		(83,338	)		(82,170	)		262,858			1,668,481			632			90,727


Change in net unrealized appreciation (depreciation)on investments		446,087			580,796			(76,705	)		(1,817,933	)		(11,411	)		(299,620	)


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	970,098		$	1,001,457		$	202,897		$	(202,337	)	$	(10,423	)	$	(214,935	)


INVESTMENT INCOME RATIO (2007)		4.77	%		4.82	%		1.20	%					0.98	%		0.69	%


INVESTMENT INCOME RATIO (2006)		4.16	%		4.44	%		1.36	%								0.92	%


INVESTMENT INCOME RATIO (2005)		2.81	%		2.65	%		1.33	%								0.59	%


INVESTMENT INCOME RATIO (2004)		1.25	%					1.05	%								1.15	%


INVESTMENT INCOME RATIO (2003)		0.72	%					0.93	%								1.15	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	PRUDENTIAL SERIES FUND EQUITY PORTFOLIO			SCHWAB MARKETTRACK GROWTH PORTFOLIO II			SCHWAB MONEY MARKET PORTFOLIO			SCHWAB S&P 500 INDEX PORTFOLIO			THIRD AVENUE VALUE PORTFOLIO			UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO

Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	6,097		$	349,787		$	2,914,133		$	1,225,332		$	89,015		$	195,831

EXPENSES:
Mortality and expense risk		9,047			130,234			535,524			723,380			33,007			157,939


NET INVESTMENT INCOME (LOSS)		(2,950	)		219,553			2,378,609			501,952			56,008			37,892


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on sale of fund shares		21,480			1,424,516						5,104,611			(23,130	)		4,894,646
Realized gain distributions		721			333,631									256,550			1,529,288


Net realized gain		22,201			1,758,147						5,104,611			233,420			6,423,934


Change in net unrealized appreciation (depreciation)on investments		61,251			(1,292,706	)					(1,741,388	)		(616,822	)		(9,194,648	)


NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS	$	80,502		$	684,994		$	2,378,609		$	3,865,175		$	(327,394	)	$	(2,732,822	)


INVESTMENT INCOME RATIO (2007)		0.57	%		2.28	%		4.62	%		1.44	%		2.29	%		1.06	%


INVESTMENT INCOME RATIO (2006)		0.48	%		1.33	%		4.51	%		1.52	%		1.11	%		1.05	%


INVESTMENT INCOME RATIO (2005)		0.65	%		1.32	%		2.71	%		1.63	%					1.23	%


INVESTMENT INCOME RATIO (2004)		0.81	%		1.26	%		0.87	%		1.10	%					1.50	%


INVESTMENT INCOME RATIO (2003)		0.69	%		1.32	%		0.75	%		1.23	%


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 2007


	VAN KAMPEN LIT COMSTOCK			VAN KAMPEN LIT GROWTH & INCOME			WELLS FARGO ADVANTAGE VT MULTI CAP VALUE FUND			WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND			TOTAL SCHWAB SELECT ANNUITY

													(Memoranda Only)
Schwab Select Annuity:

INVESTMENT INCOME:
Dividends	$	19,410		$	35,151		$	1,276		$	4,001		$	11,975,683

EXPENSES:
Mortality and expense risk		8,985			21,465			54,969			5,361			4,723,973


NET INVESTMENT INCOME		10,425			13,686			(53,693	)		(1,360	)		7,251,710


REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain on sale of fund shares		54,781			62,863			673,304			6,632			29,337,059
Realized gain distributions		23,902			82,190			1,070,524			93,059			16,717,559


Net realized gain		78,683			145,053			1,743,828			99,691			46,054,618


Change in net unrealized appreciation on investments		(107,328	)		(135,094	)		(1,748,229	)		(78,242	)		(23,004,453	)


NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	(18,220	)	$	23,645		$	(58,094	)	$	20,089		$	30,301,875


INVESTMENT INCOME RATIO (2007)		1.84	%		1.39	%		0.02	%		0.63	%


INVESTMENT INCOME RATIO (2006)		1.30	%		0.75	%


INVESTMENT INCOME RATIO (2005)								0.42	%


INVESTMENT INCOME RATIO (2004)

INVESTMENT INCOME RATIO (2003)								0.11	%


The accompanying notes are an integral part of these financial statements.	(Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	AIM V.I. CORE EQUITY FUND						AIM V.I. HIGH YIELD FUND						AIM V.I. INTERNATIONAL GROWTH FUND

	2007			2006			2007			2006			2007			2006

																(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	16,256		$	84,164		$	328,936		$	522,445		$	(8,022	)	$	7,987
Net realized gain (loss)		394,656			264,178			23,026			(66,160	)		288,088			14,906
Change in net unrealized appreciation on investments		251,137			1,119,967			(301,563	)		232,754			(38,714	)		123,401


Increase in net assets resulting from operations		662,049			1,468,309			50,399			689,039			241,352			146,294


CONTRACT TRANSACTIONS:
Purchase payments					19,096									24,490			245
Redemptions		(1,322,672	)		(1,741,963	)		(829,874	)		(1,111,312	)		(112,823	)		(4,119	)
Transfers, net		(618,763	)		(1,510,318	)		(796,487	)		(1,447,959	)		1,486,540			1,126,870
Contract maintenance charges		(1,081	)		(1,356	)		(481	)		(628	)		(58	)
Adjustments to net assets allocated to contracts in payout phase


Increase (decrease) in net assets resulting from contract transactions		(1,942,516	)		(3,234,541	)		(1,626,842	)		(2,559,899	)		1,398,149			1,122,996


Total increase (decrease) in net assets		(1,280,467	)		(1,766,232	)		(1,576,443	)		(1,870,860	)		1,639,501			1,269,290

NET ASSETS:
Beginning of period		9,482,587			11,248,819			6,680,946			8,551,806			1,269,290			0


End of period	$	8,202,120		$	9,482,587		$	5,104,503		$	6,680,946		$	2,908,791		$	1,269,290


CHANGES IN UNITS OUTSTANDING:
Units issued					5,648									255,808			150,010
Units redeemed		(94,792	)		(186,505	)		(110,262	)		(187,141	)		(139,759	)		(35,638	)


Net increase (decrease)		(94,792	)		(180,857	)		(110,262	)		(187,141	)		116,049			114,372


(1)	The portfolio commenced operations on May 1, 2006.

The accompanying notes are an integral part of these financial statements.		(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	AIM V.I. TECHNOLOGY FUND						ALGER AMERICAN GROWTH PORTFOLIO						ALGER AMERICAN MIDCAP GROWTH PORTFOLIO

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment loss	$	(35,698	)	$	(44,460	)	$	(92,938	)	$	(144,267	)	$	(34,962	)	$	(29,456	)
Net realized gain		481,711			699,105			645,878			484,745			391,502			683,108
Change in net unrealized appreciation (depreciation) on investments		(294,519	)		(154,242	)		2,492,737			271,989			666,259			(403,478	)


Increase in net assets resulting from operations		151,494			500,403			3,045,677			612,467			1,022,799			250,174


CONTRACT TRANSACTIONS:
Purchase payments		5,952			8,906			317,531			106,343			14,374			16,119
Redemptions		(505,892	)		(457,291	)		(1,620,812	)		(2,727,409	)		(196,733	)		(547,683	)
Transfers, net		(218,692	)		(1,255,827	)		1,598,433			(3,866,995	)		2,922,058			(500,893	)
Contract maintenance charges		(1,143	)					(2,875	)		(3,895	)		(390	)
Adjustments to net assets allocated to contracts in payout phase		387						6,199


Increase (decrease) in net assets resulting from contract transactions		(719,388	)		(1,704,212	)		298,476			(6,491,956	)		2,739,309			(1,032,457	)


Total increase (decrease) in net assets		(567,894	)		(1,203,809	)		3,344,153			(5,879,489	)		3,762,108			(782,283	)

NET ASSETS:
Beginning of period		4,996,857			6,200,666			17,453,240			23,332,729			2,954,490			3,736,773


End of period	$	4,428,963		$	4,996,857		$	20,797,393		$	17,453,240		$	6,716,598		$	2,954,490


CHANGES IN UNITS OUTSTANDING:
Units issued		1,166,561			1,837,107			175,188			64,938			214,943			121,023
Units redeemed		(1,493,486	)		(2,520,549	)		(176,079	)		(412,103	)		(81,147	)		(189,698	)


Net increase (decrease)		(326,925	)		(683,442	)		(891	)		(347,165	)		133,796			(68,675	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	ALLIANCE-BERNSTEIN VPS GROWTH & INCOME PORTFOLIO						ALLIANCE-BERNSTEIN VPS GROWTH PORTFOLIO						ALLIANCE-BERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO

	2007			2006			2007			2006			2007			2006

				(1)						(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	9,974		$	604		$	(6,457	)	$	(1,001	)	$	98,798		$	6,620
Net realized gain		76,783			5,011			35,724			1,863			4,297,123			643,092
Change in net unrealized appreciation (depreciation) on investments		(59,709	)		20,357			20,412			7,240			(2,933,054	)		937,616


Increase in net assets resulting from operations		27,048			25,972			49,679			8,102			1,462,867			1,587,328


CONTRACT TRANSACTIONS:
Purchase payments		5,226			1,989			38			19			31,592			13,648
Redemptions		(62,651	)		(17,335	)		(7,540	)		(13,565	)		(926,578	)		(599,416	)
Transfers, net		892,376			446,289			244,817			617,018			1,952,797			2,773,780
Contract maintenance charges		(79	)					(8	)					(744	)		(560	)
Adjustments to net assets allocated to contracts in payout phase


Increase in net assets resulting from contract transactions		834,872			430,943			237,307			603,472			1,057,067			2,187,452


Total increase in net assets		861,920			456,915			286,986			611,574			2,519,934			3,774,780

NET ASSETS:
Beginning of period		456,915			0			611,574			0			8,803,824			5,029,044


End of period	$	1,318,835		$	456,915		$	898,560		$	611,574		$	11,323,758		$	8,803,824


CHANGES IN UNITS OUTSTANDING:
Units issued		156,671			49,137			72,987			97,786			297,990			393,892
Units redeemed		(84,092	)		(8,116	)		(53,799	)		(36,097	)		(241,732	)		(233,554	)


Net increase		72,579			41,021			19,188			61,689			56,258			160,338


(1)	The portfolio commenced operations on May 1, 2006.

The accompanying notes are an integral part of these financial statements.		(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	ALLIANCE-BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO						ALLIANCE-BERNSTEIN VPS SMALL/MIDCAP VALUE PORTFOLIO						ALLIANCE-BERNSTEIN VPS UTILITY INCOME PORTFOLIO

	2007			2006			2007			2006			2007			2006

				(1)						(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	25,699		$	778		$	6,321		$	(1,165	)	$	85,257		$	52,519
Net realized gain (loss)		874,077			(57,220	)		126,802			5,173			659,726			286,473
Change in net unrealized appreciation on investments		(653,338	)		615,175			(229,209	)		28,727			149,843			510,521


Increase (decrease) in net assets resulting from operations		246,438			558,733			(96,086	)		32,735			894,826			849,513


CONTRACT TRANSACTIONS:
Purchase payments		22,766			16,033			2,505			4,020			14,405			12,061
Redemptions		(233,425	)		(100,764	)		(83,800	)		(2,518	)		(367,485	)		(308,511	)
Transfers, net		1,370,628			5,726,686			880,709			461,719			162,227			(797,406	)
Contract maintenance charges		(500	)					(78	)		(17	)		(310	)		(305	)
Adjustments to net assets allocated to contracts in payout phase														3,077			745


Increase (decrease) in net assets resulting from contract transactions		1,159,469			5,641,955			799,336			463,204			(188,086	)		(1,093,416	)


Total increase (decrease) in net assets		1,405,907			6,200,688			703,250			495,939			706,740			(243,903	)

NET ASSETS:
Beginning of period		6,200,688			0			495,939			0			4,329,571			4,573,474


End of period	$	7,606,595		$	6,200,688		$	1,199,189		$	495,939		$	5,036,311		$	4,329,571


CHANGES IN UNITS OUTSTANDING:
Units issued		424,541			638,037			169,039			53,385			141,959			142,430
Units redeemed		(331,657	)		(88,205	)		(102,830	)		(6,018	)		(152,267	)		(210,336	)


Net increase (decrease)		92,884			549,832			66,209			47,367			(10,308	)		(67,906	)


(1)	The portfolio commenced operations on May 1, 2006.

The accompanying notes are an integral part of these financial statements.		(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	AMERICAN CENTURY VP BALANCED FUND						AMERICAN CENTURY VP INTERNATIONAL FUND						AMERICAN CENTURY VP VALUE FUND

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	32,150		$	27,054		$	(14,236	)	$	105,418		$	73,496		$	41,361
Net realized gain		153,600			217,061			884,747			1,900,766			891,262			661,372
Change in net unrealized appreciation (depreciation) on investments		(83,367	)		(30,111	)		611,789			220,986			(1,520,339	)		586,888


Increase (decrease) in net assets resulting from operations		102,383			214,004			1,482,300			2,227,170			(555,581	)		1,289,621


CONTRACT TRANSACTIONS:
Purchase payments		69,740			14,239						4,949			19,497			36,538
Redemptions		(196,269	)		(206,000	)		(1,013,258	)		(1,444,736	)		(738,503	)		(1,268,048	)
Transfers, net		(421,498	)		(11,842	)		(862,626	)		(2,922,071	)		10,863			1,209,320
Contract maintenance charges		(412	)		(513	)		(632	)		(943	)		(569	)		(613	)
Adjustments to net assets allocated to contracts in payout phase														523


Decrease in net assets resulting from contract transactions		(548,439	)		(204,116	)		(1,876,516	)		(4,362,801	)		(708,189	)		(22,803	)


Total increase (decrease) in net assets		(446,056	)		9,888			(394,216	)		(2,135,631	)		(1,263,770	)		1,266,818

NET ASSETS:
Beginning of period		2,773,066			2,763,178			9,572,194			11,707,825			9,578,076			8,311,258


End of period	$	2,327,010		$	2,773,066		$	9,177,978		$	9,572,194		$	8,314,306		$	9,578,076


CHANGES IN UNITS OUTSTANDING:
Units issued		27,748			75,962						47,412			131,836			266,451
Units redeemed		(67,709	)		(93,112	)		(81,739	)		(280,684	)		(177,974	)		(278,862	)


Net decrease		(39,961	)		(17,150	)		(81,739	)		(233,272	)		(46,138	)		(12,411	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 2007 AND 2006


	DELAWARE VIP GROWTH OPPORTUNITIES SERIES						DELAWARE VIP SMALL CAP VALUE SERIES						DREYFUS IP MIDCAP STOCK PORTFOLIO

	2007			2006			2007			2006			2007			2006

					(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment loss	$	(1,426	)	$	(59	)	$	(21,005	)	$	(40,132	)	$	(5,991	)	$	(9,710	)
Net realized gain (loss)		(15,978	)		(2,259	)		705,733			885,594			53,782			353,919
Change in net unrealized depreciation on investments		(13,325	)		397			(1,082,099	)		117,931			(27,639	)		(241,799	)


Increase (decrease) in net assets resulting from operations		(30,729	)		(1,921	)		(397,371	)		963,393			20,152			102,410


CONTRACT TRANSACTIONS:
Purchase payments		1,324			20			11,787			21,884			12,089			3,331
Redemptions		(21,398	)		(6	)		(465,152	)		(903,917	)		(193,381	)		(454,150	)
Transfers, net		302,639			22,463			(1,262,903	)		(178,961	)		(168,694	)		(550,210	)
Contract maintenance charges		(14	)					(641	)		(774	)		(156	)		(246	)
Adjustments to net assets allocated to contracts in payout phase


Increase (decrease) in net assets resulting from contract transactions		282,551			22,477			(1,716,909	)		(1,061,768	)		(350,142	)		(1,001,275	)


Total increase (decrease) in net assets		251,822			20,556			(2,114,280	)		(98,375	)		(329,990	)		(898,865	)

NET ASSETS:
Beginning of period		20,556			0			6,922,622			7,020,997			1,496,803			2,395,668


End of period	$	272,378		$	20,556		$	4,808,342		$	6,922,622		$	1,166,813		$	1,496,803


CHANGES IN UNITS OUTSTANDING:
Units issued		88,669			7,389			26,508			94,112			24,959			50,486
Units redeemed		(65,899	)		(5,287	)		(119,296	)		(156,665	)		(46,915	)		(119,639	)


Net increase (decrease)		22,770			2,102			(92,788	)		(62,553	)		(21,956	)		(69,153	)


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 2007 AND 2006


	DREYFUS VIF APPRECIATION PORTFOLIO						DREYFUS VIF DEVELOPING LEADERS PORTFOLIO						DREYFUS VIF GROWTH & INCOME PORTFOLIO

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	56,443		$	64,712		$	(105	)	$	(1,187	)	$	(2,831	)	$	(3,369	)
Net realized gain		473,008			568,553			22,066			43,051			322,460			330,591
Change in net unrealized appreciation on investments		(62,080	)		607,458			(41,107	)		(44,518	)		(124,493	)		121,997


Increase (decrease) in net assets resulting from operations		467,371			1,240,723			(19,146	)		(2,654	)		195,136			449,219


CONTRACT TRANSACTIONS:
Purchase payments		6,023			14,245												7,274
Redemptions		(792,642	)		(645,068	)		(14,355	)		(11,791	)		(479,421	)		(735,437	)
Transfers, net		(489,305	)		(1,594,916	)		(52,516	)		(193,082	)		(317,843	)		(1,149,807	)
Contract maintenance charges		(457	)		(705	)		(20	)		(29	)		(310	)		(594	)
Adjustments to net assets allocated to contracts in payout phase		11,687


Decrease in net assets resulting from contract transactions		(1,264,694	)		(2,226,444	)		(66,891	)		(204,902	)		(797,574	)		(1,878,564	)


Total decrease in net assets		(797,323	)		(985,721	)		(86,037	)		(207,556	)		(602,438	)		(1,429,345	)

NET ASSETS:
Beginning of period		8,388,056			9,373,777			226,375			433,931			3,129,451			4,558,796


End of period	$	7,590,733		$	8,388,056		$	140,338		$	226,375		$	2,527,013		$	3,129,451


CHANGES IN UNITS OUTSTANDING:
Units issued		20,578			76,222			619									3,367
Units redeemed		(143,996	)		(293,765	)		(5,347	)		(15,475	)		(70,765	)		(189,272	)


Net decrease		(123,418	)		(217,543	)		(4,728	)		(15,475	)		(70,765	)		(185,905	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS
YEARS ENDED DECEMBER 31, 2007 AND 2006


	DWS BLUE CHIP VIP PORTFOLIO						DWS CAPITAL GROWTH VIP PORTFOLIO						DWS DREMAN HIGH RETURN EQUITY VIP PORTFOLIO

	2007			2006			2007			2006			2007			2006

				(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	1,205		$	(1,813	)	$	(5,607	)	$	(6,769	)	$	30,073		$	24,771
Net realized gain (loss)		85,667			(222	)		178,139			200,608			202,882			272,495
Change in net unrealized appreciation on investments		(62,987	)		35,680			107,994			(10,023	)		(347,789	)		320,698


Increase (decrease) in net assets resulting from operations		23,885			33,645			280,526			183,816			(114,834	)		617,964


CONTRACT TRANSACTIONS:
Purchase payments		46,695			37,155			50,414			29,883			335			251
Redemptions		(30,036	)		(7,943	)		(307,985	)		(337,408	)		(275,405	)		(75,607	)
Transfers, net		382,113			647,366			36,388			(140,893	)		(219,702	)		2,728,057
Contract maintenance charges		(20	)		(7	)		(286	)		(334	)		(211	)		(193	)
Adjustments to net assets allocated to contracts in payout phase								4,598


Increase (decrease) in net assets resulting from contract transactions		398,752			676,571			(216,871	)		(448,752	)		(494,983	)		2,652,508


Total increase (decrease) in net assets		422,637			710,216			63,655			(264,936	)		(609,817	)		3,270,472

NET ASSETS:
Beginning of period		710,216			0			2,508,992			2,773,928			4,995,853			1,725,381


End of period	$	1,132,853		$	710,216		$	2,572,647		$	2,508,992		$	4,386,036		$	4,995,853


CHANGES IN UNITS OUTSTANDING:
Units issued		107,476			70,747			29,490			38,831			62,100			306,498
Units redeemed		(70,946	)		(4,842	)		(53,709	)		(86,764	)		(100,552	)		(73,096	)


Net increase (decrease)		36,530			65,905			(24,219	)		(47,933	)		(38,452	)		233,402


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO						DWS GROWTH & INCOME VIP PORTFOLIO						DWS HEALTH CARE VIP PORTFOLIO

	2007			2006			2007			2006			2007			2006

					(1)												(1 )
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	6,097		$	(4,644	)	$	2,779		$	1,912		$	(8,438	)	$	(2,530	)
Net realized gain		317,241			28,645			88,093			122,443			92,205			21,550

Change in net unrealized appreciation on investments		(238,772	)		145,250			(93,559	)		295			8,226			15,760


Increase (decrease) in net assets resulting from operations		84,566			169,251			(2,687	)		124,650			91,993			34,780

CONTRACT TRANSACTIONS:
Purchase payments		4,460			3,041			2,018			1,192			162			19
Redemptions		(23,154	)		(9,238	)		(251,648	)		(77,583	)		(25,656	)		(3,970	)
Transfers, net		(553,884	)		1,666,069			(29,677	)		(359,586	)		481,497			559,680
Contract maintenance charges		(71	)		(4	)		(113	)		(171	)		(117	)
Adjustments to net assets allocated to contracts in payout phase


Increase (decrease) in net assets resulting from contract transactions		(572,649	)		1,659,868			(279,420	)		(436,148	)		455,886			555,729


Total increase (decrease) in net assets		(488,083	)		1,829,119			(282,107	)		(311,498	)		547,879			590,509

NET ASSETS:
Beginning of period		1,829,119			0			1,016,875			1,328,373			590,509			0


End of period	$	1,341,036		$	1,829,119		$	734,768		$	1,016,875		$	1,138,388		$	590,509


CHANGES IN UNITS OUTSTANDING:
Units issued		128,525			232,009			10,092			13,905			149,806			103,738
Units redeemed		(177,298	)		(59,369	)		(38,918	)		(62,299	)		(110,198	)		(48,535	)


Net increase (decrease)		(48,773	)		172,640			(28,826	)		(48,394	)		39,608			55,203


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	DWS LARGE CAP VALUE VIP PORTFOLIO						DWS SMALL CAP INDEX VIP PORTFOLIO						FEDERATED AMERICAN LEADERS FUND II

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	4,672		$	804		$	5,214		$	(21,618	)	$	73,302		$	96,286
Net realized gain		45,966			34,664			1,887,466			2,076,137			1,357,086			1,993,859
Change in net unrealized appreciation (depreciation) on investments		5,453			23,585			(2,097,273	)		(157,356	)		(2,516,768	)		(231,672	)


Increase (decrease) in net assets resulting from operations		56,091			59,053			(204,593	)		1,897,163			(1,086,380	)		1,858,473


CONTRACT TRANSACTIONS:
Purchase payments		428			294			15,157			83,650
Redemptions		(94,600	)		(9,397	)		(915,745	)		(1,056,222	)		(946,889	)		(1,278,180	)
Transfers, net		462,931			154,185			(1,540,886	)		(2,008,685	)		(1,851,271	)		(2,592,439	)
Contract maintenance charges		(6	)		(13	)		(797	)					(1,003	)		(1,366	)
Adjustments to net assets allocated to contracts in payout phase								531						3,410


Increase (decrease) in net assets resulting from contract transactions		368,753			145,069			(2,441,740	)		(2,981,257	)		(2,795,753	)		(3,871,985	)


Total increase (decrease) in net assets		424,844			204,122			(2,646,333	)		(1,084,094	)		(3,882,133	)		(2,013,512	)

NET ASSETS:
Beginning of period		432,642			228,520			11,839,038			12,923,132			12,720,787			14,734,299


End of period	$	857,486		$	432,642		$	9,192,705		$	11,839,038		$	8,838,654		$	12,720,787


CHANGES IN UNITS OUTSTANDING:
Units issued		55,580			69,130			44,976			90,601
Units redeemed		(27,888	)		(54,842	)		(177,479	)		(268,642	)		(135,805	)		(203,160	)


Net increase (decrease)		27,692			14,288			(132,503	)		(178,041	)		(135,805	)		(203,160	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	FEDERATED CAPITAL INCOME FUND II						FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II						FRANKLIN SMALL CAP VALUE SECURITIES FUND

	2007			2006			2007			2006			2007			2006

																(1 )
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	37,357		$	66,126		$	1,114,694		$	1,176,985		$	(1,197	)	$	(1,457	)
Net realized gain (loss)		68,646			90,199			(226,554	)		(397,433	)		42,100			15,264
Change in net unrealized appreciation (depreciation) on investments		(76,419	)		14,377			738,090			252,420			(61,879	)		16,458


Increase (decrease) in net assets resulting from operations		29,584			170,702			1,626,230			1,031,972			(20,976	)		30,265

CONTRACT TRANSACTIONS:
Purchase payments								141,862			227,802			38			19
Redemptions		(237,211	)		(168,688	)		(3,289,896	)		(3,944,582	)		(6,334	)		(813	)
Transfers, net		(82,496	)		(386,355	)		(634,711	)		(2,659,894	)		67,190			445,650
Contract maintenance charges		(181	)					(1,685	)					(34	)
Adjustments to net assets allocated to contracts in payout phase								7,761


Increase (decrease) in net assets resulting from contract transactions		(319,888	)		(555,043	)		(3,776,669	)		(6,376,674	)		60,860			444,856


Total increase (decrease) in net assets		(290,304	)		(384,341	)		(2,150,439	)		(5,344,702	)		39,884			475,121

NET ASSETS:
Beginning of period		1,105,092			1,489,433			32,952,136			38,296,838			475,121			0


End of period	$	814,788		$	1,105,092		$	30,801,697		$	32,952,136		$	515,005		$	475,121


CHANGES IN UNITS OUTSTANDING:
Units issued								194,749			188,518			39,937			86,397
Units redeemed		(24,218	)		(46,306	)		(440,404	)		(613,940	)		(34,347	)		(39,761	)


Net increase (decrease)		(24,218	)		(46,306	)		(245,655	)		(425,422	)		5,590			46,636


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES							JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES		JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES							JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES

	2007			2006			2007			2007			2006			2007

							(1)									(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income	$	72,675		$	55,273		$	17,680		$	747,216		$	834,694		$	58,740
Net realized gain (loss)		236,219			153,980			6,735			(487,590	)		(674,566	)		167
Change in net unrealized appreciation on investments		136,104			125,649			9,850			880,743			503,588			46,748


Increase in net assets resulting from operations		444,998			334,902			34,265			1,140,369			663,716			105,655

CONTRACT TRANSACTIONS:
Purchase payments		3,068			13,071			10,360			49,125			163,798			293,925
Redemptions		(511,312	)		(327,466	)		(405,825	)		(1,618,860	)		(2,396,556	)		(98,712	)
Transfers, net		(107,003	)		1,608,344			1,818,030			(1,977,985	)		(1,370,739	)		2,249,966
Contract maintenance charges		(614	)					(21	)		(1,140	)					(6	)
Adjustments to net assets allocated to contracts in payout phase											5,327


Increase (decrease) in net assets resulting from contract transactions		(615,861	)		1,293,949			1,422,544			(3,543,533	)		(3,603,497	)		2,445,173


Total increase (decrease) in net assets		(170,863	)		1,628,851			1,456,809			(2,403,164	)		(2,939,781	)		2,550,828

NET ASSETS:
Beginning of period		4,460,288			2,831,437			0			20,816,637			23,756,418			0


End of period	$	4,289,425		$	4,460,288		$	1,456,809		$	18,413,473		$	20,816,637		$	2,550,828


CHANGES IN UNITS OUTSTANDING:
Units issued		61,383			206,111			188,212			52,489			203,122			286,851
Units redeemed		(101,874	)		(105,976	)		(48,409	)		(305,878	)		(470,646	)		(41,987	)


Net increase (decrease)		(40,491	)		100,135			139,803			(253,389	)		(267,524	)		244,864


(1)	The portfolio commenced operations on May 1, 2007.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	JANUS ASPEN GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES						JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES			JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO INSTITUTIONAL SHARES						JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO SERVICE SHARES

	2007			2006			2007			2007			2006			2007

							(1)									(1 )
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	37,798		$	39,850		$	5,866		$	(65,993	)	$	244,345		$	(12,960	)
Net realized gain (loss)		347,354			186,256			(12,398	)		3,924,496			9,959,706			694,731
Change in net unrealized depreciation on investments		(78,840	)		54,911			(20,211	)		3,348,825			(995,479	)		(172,404	)


Increase (decrease) in net assets resulting from operations		306,312			281,017			(26,743	)		7,207,328			9,208,572			509,367


CONTRACT TRANSACTIONS:
Purchase payments		4,247			12,400			4,415			87,203			408,904			29,132
Redemptions		(474,869	)		(184,977	)		(7,157	)		(1,749,179	)		(2,691,033	)		(42,416	)
Transfers, net		(1,477,052	)		1,004,789			1,150,071			(5,096,905	)		280,980			5,344,691
Contract maintenance charges		(233	)		(374	)		(37	)		(2,688	)					(190	)
Adjustments to net assets allocated to contracts in payout phase											5,452


Increase (decrease) in net assets resulting from contract transactions		(1,947,907	)		831,838			1,147,292			(6,756,117	)		(2,001,149	)		5,331,217


Total increase (decrease) in net assets		(1,641,595	)		1,112,855			1,120,549			451,211			7,207,423			5,840,584

NET ASSETS:
Beginning of period		4,754,762			3,641,907			0			28,409,178			21,201,755			0


End of period	$	3,113,167		$	4,754,762		$	1,120,549		$	28,860,389		$	28,409,178		$	5,840,584


CHANGES IN UNITS OUTSTANDING:
Units issued		13,487			138,103			152,276			379,563			1,525,206			1,220,241
Units redeemed		(138,159	)		(81,195	)		(42,551	)		(618,876	)		(1,629,045	)		(729,412	)


Net increase (decrease)		(124,672	)		56,908			109,725			(239,313	)		(103,839	)		490,829


(1)	The portfolio commenced operations on May 1, 2007.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	JANUS ASPEN LARGE CAP GROWTH PORTFOLIO						JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO						LVIP BARON GROWTH OPPORTUNITIES PORTFOLIO

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	(19,960	)	$	(58,280	)	$	(16,812	)	$	133,605		$	(140,505	)	$	(172,048	)
Net realized gain (loss)		(52,583	)		(788,195	)		982,164			1,185,996			4,248,128			2,851,856
Change in net unrealized appreciation on investments		1,862,744			2,304,147			385,849			1,116,652			(3,566,151	)		25,322


Increase in net assets resulting from operations		1,790,201			1,457,672			1,351,201			2,436,253			541,472			2,705,130


CONTRACT TRANSACTIONS:
Purchase payments					24,654									39,030			41,017
Redemptions		(1,469,438	)		(1,960,733	)		(1,411,411	)		(1,684,621	)		(1,879,633	)		(1,988,732	)
Transfers, net		(1,230,873	)		(2,331,491	)		(1,015,573	)		(2,976,567	)		(3,402,478	)		(4,527,139	)
Contract maintenance charges		(2,873	)					(3,404	)		(4,066	)		(1,570	)
Adjustments to net assets allocated to contracts in payout phase		4,288						7,536						5,099


Decrease in net assets resulting from contract transactions		(2,698,896	)		(4,267,570	)		(2,422,852	)		(4,665,254	)		(5,239,552	)		(6,474,854	)


Total decrease in net assets		(908,695	)		(2,809,898	)		(1,071,651	)		(2,229,001	)		(4,698,080	)		(3,769,724	)

NET ASSETS:
Beginning of period		13,884,307			16,694,205			15,615,679			17,844,680			18,446,875			22,216,599


End of period	$	12,975,612		$	13,884,307		$	14,544,028		$	15,615,679		$	13,748,795		$	18,446,875


CHANGES IN UNITS OUTSTANDING:
Units issued					16,936						303			38,314			65,529
Units redeemed		(149,153	)		(283,529	)		(117,997	)		(270,239	)		(298,113	)		(421,743	)


Net decrease		(149,153	)		(266,593	)		(117,997	)		(269,936	)		(259,799	)		(356,214	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	NEUBERGER BERMAN AMT REGENCY PORTFOLIO						NVIT MID CAP INDEX FUND						OPPENHEIMER GLOBAL SECURITIES FUND/VA

	2007			2006			2007			2006			2007			2006

					(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	(1,386	)	$	(751	)	$	15,271		$	5,775		$	89,596		$	36,664
Net realized gain (loss)		12,703			(12,128	)		405,172			408,619			2,361,214			2,338,080
Change in net unrealized appreciation on investments		(17,849	)		(2,660	)		(114,694	)		(4,663	)		(1,478,304	)		169,480


Increase (decrease) in net assets resulting from operations		(6,532	)		(15,539	)		305,749			409,731			972,506			2,544,224


CONTRACT TRANSACTIONS:
Purchase payments		38			45			6,466			10,332			84,641			110,918
Redemptions		(19,973	)		(876	)		(394,760	)		(487,258	)		(1,111,500	)		(1,566,780	)
Transfers, net		110,788			169,388			(941,364	)		(293,733	)		(1,279,967	)		(371,030	)
Contract maintenance charges		(17	)		(18	)		(383	)		(501	)		(1,212	)		(1,524	)
Adjustments to net assets allocated to contracts in payout phase														8,859


Increase (decrease) in net assets resulting from contract transactions		90,836			168,539			(1,330,041	)		(771,160	)		(2,299,179	)		(1,828,416	)


Total increase (decrease) in net assets		84,304			153,000			(1,024,292	)		(361,429	)		(1,326,673	)		715,808

NET ASSETS:
Beginning of period		153,000			0			4,568,581			4,930,010			17,422,796			16,706,988


End of period	$	237,304		$	153,000		$	3,544,289		$	4,568,581		$	16,096,123		$	17,422,796


CHANGES IN UNITS OUTSTANDING:
Units issued		76,130			82,208			31,475			96,339			121,841			192,961
Units redeemed		(68,370	)		(67,225	)		(105,872	)		(144,115	)		(233,965	)		(295,522	)


Net increase (decrease)		7,760			14,983			(74,397	)		(47,776	)		(112,124	)		(102,561	)


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	PIMCO VIT HIGH YIELD PORTFOLIO						PIMCO VIT LOW DURATION BOND PORTFOLIO						PIMCO VIT TOTAL RETURN PORTFOLIO

	2007			2006			2007			2006			2007			2006


Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income	$	466,199		$	434,535		$	607,349		$	584,004		$	502,831		$	285,479
Net realized loss		(3,365	)		(87,939	)		(83,338	)		(140,013	)		(82,170	)		(38,371	)
Change in net unrealized appreciation (depreciation) on investments		(286,810	)		229,301			446,087			88,444			580,796			42,159


Increase in net assets resulting from operations		176,024			575,897			970,098			532,435			1,001,457			289,267


CONTRACT TRANSACTIONS:
Purchase payments		13,204			3,851			85,030			5,511			56,650			1,011
Redemptions		(487,448	)		(495,769	)		(2,108,872	)		(1,885,867	)		(1,286,423	)		(791,187	)
Transfers, net		(2,027,628	)		2,515,506			602,009			(493,289	)		4,494,973			6,428,343
Contract maintenance charges		(443	)		(494	)		(837	)		(1,042	)		(521	)		(374	)
Adjustments to net assets allocated to contracts in payout phase								8,515


Increase (decrease) in net assets resulting from contract transactions		(2,502,315	)		2,023,094			(1,414,155	)		(2,374,687	)		3,264,679			5,637,793


Total increase (decrease) in net assets		(2,326,291	)		2,598,991			(444,057	)		(1,842,252	)		4,266,136			5,927,060

NET ASSETS:
Beginning of period		8,410,379			5,811,388			16,335,082			18,177,334			11,074,784			5,147,724


End of period	$	6,084,088		$	8,410,379		$	15,891,025		$	16,335,082		$	15,340,920		$	11,074,784


CHANGES IN UNITS OUTSTANDING:
Units issued		305,660			502,808			260,285			415,929			602,541			788,010
Units redeemed		(494,715	)		(340,829	)		(406,437	)		(647,232	)		(298,470	)		(230,518	)


Net increase (decrease)		(189,055	)		161,979			(146,152	)		(231,303	)		304,071			557,492


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	PIONEER FUND VCT PORTFOLIO						PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO						PIONEER MID CAP VALUE VCT PORTFOLIO

	2007			2006			2007			2006			2007			2006

																(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	16,744		$	23,013		$	(52,885	)	$	(74,344	)	$	356		$	(26	)
Net realized gain		262,858			146,497			1,668,481			1,633,388			632			335
Change in net unrealized appreciation (depreciation) on investments		(76,705	)		504,346			(1,817,933	)		(1,333,832	)		(11,411	)		22


Increase (decrease) in net assets resulting from operations		202,897			673,856			(202,337	)		225,212			(10,423	)		331


CONTRACT TRANSACTIONS:
Purchase payments		16,705			43,176			18,082			36,739			155			24
Redemptions		(473,471	)		(329,673	)		(711,955	)		(644,785	)		(19,245	)		(11	)
Transfers, net		(459,543	)		442,656			(1,277,492	)		(2,668,309	)		277,459			20,232
Contract maintenance charges		(605	)		(767	)		(657	)		(973	)		(12	)
Adjustments to net assets allocated to contracts in payout phase								792			301


Increase (decrease) in net assets resulting from contract transactions		(916,914	)		155,392			(1,971,230	)		(3,277,027	)		258,357			20,245


Total increase (decrease) in net assets		(714,017	)		829,248			(2,173,567	)		(3,051,815	)		247,934			20,576

NET ASSETS:
Beginning of period		5,064,963			4,235,715			7,145,775			10,197,590			20,576			0


End of period	$	4,350,946		$	5,064,963		$	4,972,208		$	7,145,775		$	268,510		$	20,576


CHANGES IN UNITS OUTSTANDING:
Units issued		17,050			96,957			8,586			75,721			59,251			3,013
Units redeemed		(76,427	)		(85,787	)		(139,034	)		(314,382	)		(36,996	)		(1,077	)


Net increase (decrease)		(59,377	)		11,170			(130,448	)		(238,661	)		22,255			1,936


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	PIONEER SMALL CAP VALUE VCT PORTFOLIO						PRUDENTIAL SERIES FUND EQUITY PORTFOLIO						SCHWAB MARKETTRACK GROWTH PORTFOLIO II

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	(6,042	)	$	4,450		$	(2,950	)	$	(4,949	)	$	219,553		$	70,103
Net realized gain		90,727			1,539,807			22,201			190,009			1,758,147			714,607
Change in net unrealized appreciation on investments		(299,620	)		(1,055,601	)		61,251			(72,434	)		(1,292,706	)		1,168,361


Increase (decrease) in net assets resulting from operations		(214,935	)		488,656			80,502			112,626			684,994			1,953,071


CONTRACT TRANSACTIONS:
Purchase payments		3,339			27,446			1,598			3,513			82,805			198,537
Redemptions		(471,315	)		(496,086	)		(64,274	)		(122,705	)		(978,161	)		(1,470,317	)
Transfers, net		(1,167,430	)		(1,433,370	)		4,055			(469,157	)		(1,050,920	)		399,748
Contract maintenance charges		(211	)		(437	)		(147	)		(152	)		(1,741	)		(1,912	)
Adjustments to net assets allocated to contracts in payout phase		1,423			637


Decrease in net assets resulting from contract transactions		(1,634,194	)		(1,901,810	)		(58,768	)		(588,501	)		(1,948,017	)		(873,944	)


Total increase (decrease) in net assets		(1,849,129	)		(1,413,154	)		21,734			(475,875	)		(1,263,023	)		1,079,127

NET ASSETS:
Beginning of period		4,615,795			6,028,949			1,084,411			1,560,286			15,637,620			14,558,493


End of period	$	2,766,666		$	4,615,795		$	1,106,145		$	1,084,411		$	14,374,597		$	15,637,620


CHANGES IN UNITS OUTSTANDING:
Units issued		9,928			113,559			5,434			42,205			116,245			114,776
Units redeemed		(95,688	)		(224,446	)		(10,578	)		(97,896	)		(210,276	)		(162,245	)


Net decrease		(85,760	)		(110,887	)		(5,144	)		(55,691	)		(94,031	)		(47,469	)


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	SCHWAB MONEY MARKET PORTFOLIO						SCHWAB S&P 500 INDEX PORTFOLIO						THIRD AVENUE VALUE PORTFOLIO

	2007			2006			2007			2006			2007			2006

																(1)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income	$	2,378,609		$	2,209,395		$	501,952		$	587,423		$	56,008		$	6,837
Net realized gain								5,104,611			3,204,090			233,420			31,480
Change in net unrealized appreciation (depreciation) on investments								(1,741,388	)		8,079,854			(616,822	)		100,582


Increase (decrease) in net assets resulting from operations		2,378,609			2,209,395			3,865,175			11,871,367			(327,394	)		138,899


CONTRACT TRANSACTIONS:
Purchase payments		2,698,530			4,176,465			607,042			433,961			13,803			2,021
Redemptions		(19,102,289	)		(21,418,198	)		(9,232,547	)		(8,855,700	)		(222,664	)		(21,445	)
Transfers, net		19,013,884			16,786,365			(3,979,896	)		(7,213,282	)		963,347			2,985,063
Contract maintenance charges		(20,704	)		(24,095	)		(12,164	)		(15,018	)		(346	)		(85	)
Adjustments to net assets allocated to contracts in payout phase		28,515			4,936			18,586			283


Increase (decrease) in net assets resulting from contract transactions		2,617,936			(474,527	)		(12,598,979	)		(15,649,756	)		754,140			2,965,554


Total increase (decrease) in net assets		4,996,545			1,734,868			(8,733,804	)		(3,778,389	)		426,746			3,104,453

NET ASSETS:
Beginning of period		60,970,164			59,235,296			88,284,945			92,063,334			3,104,453			0


End of period	$	65,966,709		$	60,970,164		$	79,551,141		$	88,284,945		$	3,531,199		$	3,104,453


CHANGES IN UNITS OUTSTANDING:
Units issued		4,173,387			4,922,490			315,893			250,830			196,033			320,796
Units redeemed		(3,986,716	)		(4,958,251	)		(902,476	)		(1,073,855	)		(134,294	)		(19,751	)


Net increase (decrease)		186,671			(35,761	)		(586,583	)		(823,025	)		61,739			301,045


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	UNIVERSAL INSTITUTIONAL FUND U.S. REAL ESTATE PORTFOLIO						VAN KAMPEN LIT COMSTOCK						VAN KAMPEN LIT GROWTH & INCOME

	2007			2006			2007			2006			2007			2006

Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	37,892		$	41,298		$	10,425		$	4,180		$	13,686		$	(1,601	)
Net realized gain		6,423,934			4,578,809			78,683			73,245			145,053			83,889
Change in net unrealized appreciation on investments		(9,194,648	)		1,863,494			(107,328	)		64,979			(135,094	)		172,765


Increase (decrease) in net assets resulting from operations		(2,732,822	)		6,483,601			(18,220	)		142,404			23,645			255,053


CONTRACT TRANSACTIONS:
Purchase payments		43,502			82,405			147			525			30,720			1,648
Redemptions		(2,159,407	)		(1,220,204	)		(51,924	)		(151,522	)		(69,691	)		(67,016	)
Transfers, net		(7,186,553	)		51,233			(165,288	)		385,892			312,375			1,094,285
Contract maintenance charges		(1,241	)		(1,794	)		(82	)		(71	)		(173	)		(179	)
Adjustments to net assets allocated to contracts in payout phase		233			2,406


Increase (decrease) in net assets resulting from contract transactions		(9,303,466	)		(1,085,954	)		(217,147	)		234,824			273,231			1,028,738


Total increase (decrease) in net assets		(12,036,288	)		5,397,647			(235,367	)		377,228			296,876			1,283,791

NET ASSETS:
Beginning of period		23,695,040			18,297,393			1,127,748			750,520			2,164,670			880,879


End of period	$	11,658,752		$	23,695,040		$	892,381		$	1,127,748		$	2,461,546		$	2,164,670


CHANGES IN UNITS OUTSTANDING:
Units issued		61,475			188,655			33,117			76,803			94,369			124,856
Units redeemed		(330,915	)		(226,829	)		(50,201	)		(55,350	)		(74,655	)		(34,317	)


Net increase (decrease)		(269,440	)		(38,174	)		(17,084	)		21,453			19,714			90,539


The accompanying notes are an integral part of these financial statements.	(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 2007 AND 2006


	WELLS FARGO ADVANTAGE VT MULTI CAP VALUE FUND						WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND						TOTAL SCHWAB SELECT ANNUITY

	2007			2006			2007			2006			2007			2006

										(1)			(Memoranda Only)			(Memoranda Only)
Schwab Select Annuity:

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income (loss)	$	(53,693	)	$	(67,843	)	$	(1,360	)	$	(1,733	)	$	7,251,710		$	7,186,257
Net realized gain		1,743,828			2,127,132			99,691			12,934			46,054,618			42,060,634
Change in net unrealized appreciation (depreciation) on investments		(1,748,229	)		(949,771	)		(78,242	)		17,800			(23,004,453	)		17,292,144


Increase (decrease) in net assets resulting from operations		(58,094	)		1,109,518			20,089			29,001			30,301,875			66,539,035


CONTRACT TRANSACTIONS:
Purchase payments								5,024			144			5,108,894			6,486,381
Redemptions		(660,850	)		(994,401	)		(18,174	)		(10	)		(65,902,978	)		(72,524,598	)
Transfers, net		(1,191,922	)		(1,232,534	)		111,290			437,152			4,549,318			3,686,349
Contract maintenance charges		(546	)		(797	)		(48	)		(34	)		(70,348	)		(67,973	)
Adjustments to net assets allocated to contracts in payout phase		5,385												138,183			9,308


Increase (decrease) in net assets resulting from contract transactions		(1,847,933	)		(2,227,732	)		98,092			437,252			(56,176,931	)		(62,410,533	)


Total increase (decrease) in net assets		(1,906,027	)		(1,118,214	)		118,181			466,253			(25,875,056	)		4,128,502

NET ASSETS:
Beginning of period		7,450,388			8,568,602			466,253			0			562,204,649			558,076,147


End of period	$	5,544,361		$	7,450,388		$	584,434		$	466,253		$	536,329,593		$	562,204,649


CHANGES IN UNITS OUTSTANDING:
Units issued					3,495			60,722			57,217			13,161,573			16,000,106
Units redeemed		(124,335	)		(159,103	)		(52,413	)		(12,430	)		(15,658,546	)		(19,521,810	)


Net increase (decrease)		(124,335	)		(155,608	)		8,309			44,787			(2,496,973	)		(3,521,704	)


(1)	The portfolio commenced operations on May 1, 2006.


The accompanying notes are an integral part of these financial statements.	(Concluded)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2007


1.	ORGANIZATION

	The Variable Annuity-1 Series Account (the Series Account), a separate account of Great-West Life & Annuity Insurance Company (the Company), was established under Colorado law. The Series Account commenced operations on November 1, 1996. As of May 3, 2001, the Company began offering a new contract in the Series Account (Schwab Signature Annuity). The original contract in the Series Account is designated the Schwab Select Annuity. The Series Account is registered as a unit investment trust under the Investment Company Act of 1940, as amended. The Series Account is a funding vehicle for both group and individual variable annuity contracts. The Series Account consists of numerous investment divisions with each investment division being treated as an individual separate account and investing all of its investible assets in the named underlying mutual fund.

	Under applicable insurance law, the assets and liabilities of the Series Account are clearly identified and distinguished from the Company’s other assets and liabilities. The portion of the Series Account’s assets applicable to the reserves and other contract liabilities with respect to the Series Account is not chargeable with liabilities arising out of any other business the Company may conduct.

2.	SIGNIFICANT ACCOUNTING POLICIES

	Use of Estimates

	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

	Application of Recent Accounting Pronouncements

	In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“FAS 157”). FAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. FAS 157 shall be effective for financial statements issued for fiscal years beginning after November 15, 2007. The Series Account is evaluating the impact, if any, that the adoption of FAS 157 will have on its financial statements.

	In February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115” (“FAS 159”). FAS 159 permits an entity to measure financial instruments and certain other items at estimated fair value. Most of the provisions of FAS 159 are elective; however, the amendment to FASB No. 115, “Accounting for Certain Investments in Debt and Equity Securities”, applies to all entities that own trading and available-for-sale securities. The fair value option (a) may generally be applied instrument by instrument, (b) is irrevocable unless a new election date occurs, and (c) must be applied to the entire instrument and not to only a portion of the instrument. FAS 159 is effective as of the beginning of the first fiscal year that begins after November 15, 2007. The Series Account adopted the provisions of FAS 159 on January 1, 2008. The adoption had no impact on the financial statements.


	Security Transactions

	Investments made in the underlying mutual funds are valued at the reported net asset values of such underlying mutual funds, which value their investment securities at fair value. Transactions are recorded on a trade date basis. Income from dividends and gains from realized gain distributions are recorded on the ex-distribution date.

	Realized gains and losses on the sales of investments are computed on the basis of the identified cost of the investment sold.

	One or more of the underlying investment divisions may invest in governmental agencies, foreign issuers and high yield bonds.

	Investments in securities of governmental agencies may only be guaranteed by the respective agency’s limited authority to borrow from the U.S. Government and may not be guaranteed by the full faith and credit of the U.S. Government.

	The underlying investment divisions may have elements of risk due to concentrated investments in foreign issuers located in a specific country. Such concentrations may subject the underlying investment divisions to additional risks resulting from future political or economic conditions and/or possible impositions of adverse foreign governmental laws or currency exchange restrictions.

	The underlying investment divisions invest in high yield bonds, some of which may be rated below investment grade. These high yield bonds may be more susceptible than higher grade bonds to real or perceived adverse economic or industry conditions. The secondary market, on which high yield bonds are traded, may also be less liquid than the market for higher grade bonds.

	Contracts in the Payout Phase

	Net assets allocated to contracts in the payout phase are computed according to the 2000 Individual Annuitant Mortality Table. The assumed investment return is 5 percent. The mortality risk is fully borne by the Company and may result in additional amounts being transferred into the variable annuity account by the Company to cover greater longevity of annuitants than expected. Conversely, if amounts allocated exceed amounts required, transfers may be made to the Company and recorded as surrenders reflected in the Statement of Changes in Net Assets.

	Federal Income Taxes

	The operations of the Series Account are included in the federal income tax return of the Company, which is taxed as a life insurance company under the provisions of the Internal Revenue Code (IRC). Under the current provisions of the IRC, the Company does not expect to incur federal income taxes on the earnings of the Series Account to the extent the earnings are credited under the contracts. Based on this, no charge is being made currently to the Series Account for federal income taxes. The Company will review periodically the status of this policy in the event of changes in the tax law. A charge may be made in future years for any federal income taxes that would be attributable to the contracts.

	Net Transfers

	Net transfers include transfers between investment divisions of the Series Account as well as transfers between other investment options of the Company, not included in the Series Account.

	Investment Income Ratio

	The Investment Income Ratio represents the dividends, excluding distributions of capital gains, received by the investment division from the underlying mutual fund divided by average net assets. The ratio excludes those expenses, such as mortality and expense charges, that result in direct reductions in the unit values and


	has been annualized for any investment division not having a full year of operations. The recognition of investment income by the investment division is affected by the timing of the declaration of dividends by the underlying fund in which the investment division invests.

3.	PURCHASES AND SALES OF INVESTMENTS

	The cost of purchases and proceeds from sales of investments for the year ended December 31, 2007 were as follows:


Schwab Select Annuity:	Purchases		Sales


Aim V.I. Core Equity Fund	$	92,420	$	2,028,366
Aim V.I. High Yield Fund		378,836		1,678,943
Aim V.I. International Growth Fund		3,112,665		1,722,361
Aim V.I. Technology Fund		3,375,239		4,110,879
Alger American Growth Portfolio		3,763,118		3,565,251
Alger American Midcap Growth Portfolio		4,579,130		1,420,590
AllianceBernstein VPS Growth & Income Portfolio		1,853,312		940,896
AllianceBernstein VPS Growth Portfolio		795,733		564,847
AllianceBernstein VPS International Growth Portfolio		8,464,030		3,827,815
AllianceBernstein VPS International Value Portfolio		5,302,234		3,865,585
AllianceBernstein VPS Small/Midcap Value Portfolio		2,068,492		1,128,033
AllianceBernstein VPS Utility Income Portfolio		2,994,189		3,102,965
American Century VP Balanced Fund		568,798		897,383
American Century VP International Fund		65,317		1,957,583
American Century VP Value Fund		2,994,667		2,812,277
Delaware VIP Growth Opportunities Series		969,653		688,323
Delaware VIP Small Cap Value Series		1,057,047		2,274,290
Dreyfus IP Midcap Stock Portfolio		580,530		758,572
Dreyfus VIF Appreciation Portfolio		497,834		1,717,675
Dreyfus VIF Developing Leaders Portfolio		36,553		77,785
Dreyfus VIF Growth & Income Portfolio		141,862		819,622
DWS Blue Chip VIP Portfolio		1,289,177		795,972
DWS Capital Growth VIP Portfolio		334,419		560,726
DWS Dreman High Return Equity VIP Portfolio		1,095,859		1,322,636
DWS Dreman Small Mid Cap Value VIP Portfolio		1,763,863		1,993,977
DWS Growth & Income VIP Portfolio		123,358		389,474
DWS Health Care VIP Portfolio		1,746,658		1,243,611
DWS Large Cap Value VIP Portfolio		745,286		352,805
DWS Small Cap Index VIP Portfolio		1,553,547		3,277,848
Federated American Leaders Fund II		1,412,438		2,894,385
Federated Capital Income Fund II		45,055		327,611
Federated Fund For U.S. Government Securities II		3,960,733		6,633,194
Franklin Small Cap Value Securities Fund		459,250		365,857
Janus Aspen Balanced Portfolio Institutional Shares		923,080		1,466,291
Janus Aspen Balanced Portfolio Service Shares		1,805,288		435,312
Janus Aspen Flexible Bond Portfolio Institutional Shares		1,597,496		4,417,246
Janus Aspen Flexible Bond Portfolio Service Shares		2,928,885		425,108
Janus Aspen Growth & Income Portfolio Institutional Shares		264,253		2,180,770
Janus Aspen Growth & Income Portfolio Service Shares		1,592,031		438,692
Janus Aspen International Growth Portfolio Institutional Shares		9,145,959		15,941,917
Janus Aspen International Growth Portfolio Service Shares		13,878,787		8,537,818
Janus Aspen Large Cap Growth Portfolio		94,255		2,818,454
Janus Aspen Worldwide Growth Portfolio		115,635		2,567,923


LVIP Baron Growth Opportunities Portfolio		2,387,542		5,972,128
Neuberger Berman Amt Regency Portfolio		825,486		730,224
NVIT Mid Cap Index Fund		733,158		1,946,203
Oppenheimer Global Securities Fund/VA		3,562,767		4,930,330
Pimco VIT High Yield Portfolio		4,555,584		6,601,599
Pimco VIT Low Duration Bond Portfolio		3,365,091		4,198,021
Pimco VIT Total Return Portfolio		6,654,410		2,895,067
Pioneer Fund VCT Portfolio		260,894		1,156,914
Pioneer Growth Opportunities VCT Portfolio		970,195		2,129,777
Pioneer Mid Cap Value VCT Portfolio		749,250		444,430
Pioneer Small Cap Value VCT Portfolio		1,106,504		1,901,238
Prudential Series Fund Equity Portfolio		75,340		136,346
Schwab Markettrack Growth Portfolio II		3,023,518		4,377,545
Schwab Money Market Portfolio		49,410,872		44,963,009
Schwab S&P 500 Index Portfolio		6,864,636		19,182,523
Third Avenue Value Portfolio		2,412,722		1,345,919
Universal Institutional Fund U.S. Real Estate Portfolio		3,681,079		11,387,923
Van Kampen LIT Comstock		448,774		631,621
Van Kampen LIT Growth & Income		1,365,173		995,954
Wells Fargo Advantage VT Multi Cap Value Fund		1,071,800		1,905,277

Wells Fargo Advantage VT Opportunity Fund		770,529		580,685


Total	$	184,862,295	$	217,760,401


Schwab Signature Annuity:	Purchases		Sales


Aim V.I. High Yield Fund	$	96,486	$	288,965
Aim V.I. International Growth Fund		8,238,990		3,058,300
Aim V.I. Technology Fund		0		188,203
Alger American Balanced Portfolio		183,370		428,393
Alger American Growth Portfolio		7,558,454		1,858,717
Alger American Midcap Growth Portfolio		5,552,941		1,650,843
AllianceBernstein VPS Growth & Income Portfolio		4,148,888		2,731,978
AllianceBernstein VPS Growth Portfolio		1,822,895		1,154,419
AllianceBernstein VPS International Growth Portfolio		22,783,487		5,292,309
AllianceBernstein VPS International Value Portfolio		13,178,536		3,949,889
AllianceBernstein VPS Real Estate Investment Portfolio		6,791,623		8,668,573
AllianceBernstein VPS Small/Midcap Value Portfolio		3,519,958		2,374,541
AllianceBernstein VPS Utility Income Portfolio		4,298,535		2,967,835
American Century VP Balanced Fund		3,070,353		753,272
American Century VP Income & Growth Fund		2,000,744		3,004,937
American Century VP International Fund		53,125		1,640,640
American Century VP Value Fund		7,248,330		3,974,926
Delaware VIP Growth Opportunities Series		586,313		409,530
Delaware VIP Small Cap Value Series		3,942,140		5,677,205
Dreyfus IP Midcap Stock Portfolio		991,285		654,819
Dreyfus VIF Appreciation Portfolio		744,135		278,802
Dreyfus VIF Developing Leaders Portfolio		186,537		339,134
Dreyfus VIF Growth & Income Portfolio		132,841		463,362
DWS Blue Chip VIP Portfolio		5,825,795		1,578,271
DWS Capital Growth VIP Portfolio		1,170,745		539,578
DWS Dreman High Return Equity VIP Portfolio		3,324,435		3,798,010
DWS Dreman Small Mid Cap Value VIP Portfolio		2,753,922		1,150,170


DWS Health Care VIP Portfolio		2,260,749		618,665
DWS Large Cap Value VIP Portfolio		2,376,356		569,699
DWS Small Cap Growth VIP Portfolio		0		337,379
DWS Small Cap Index VIP Portfolio		2,703,865		1,244,709
Federated Fund For U.S. Government Securities II		6,307,242		4,713,112
Federated International Equity Fund II		3,563		667,705
Franklin Small Cap Value Securities Fund		777,641		377,082
Janus Aspen Balanced Portfolio Institutional Shares		2,891,264		2,119,972
Janus Aspen Balanced Portfolio Service Shares		6,708,334		249,742
Janus Aspen Flexible Bond Portfolio Institutional Shares		3,776,607		4,690,869
Janus Aspen Flexible Bond Portfolio Service Shares		6,542,245		445,542
Janus Aspen Growth & Income Portfolio Institutional Shares		2,292,137		4,011,420
Janus Aspen Growth & Income Portfolio Service Shares		5,289,699		370,037
Janus Aspen Worldwide Growth Portfolio		73,766		604,644
JPMorgan Small Company Portfolio		106,891		733,123
LVIP Baron Growth Opportunities Portfolio		4,517,430		1,930,646
Neuberger Berman Amt Regency Portfolio		685,772		440,080
NVIT Mid Cap Index Fund		2,634,855		1,581,354
Old Mutual Large Cap Growth Portfolio		2,867		192,201
Oppenheimer Global Securities Fund/VA		7,806,656		4,439,683
Oppenheimer International Growth Fund/VA		9,429,114		4,560,768
Pimco VIT High Yield Portfolio		12,618,501		7,790,477
Pimco VIT Low Duration Bond Portfolio		9,209,515		4,995,710
Pimco VIT Total Return Portfolio		22,872,725		7,545,336
Pioneer Fund VCT Portfolio		1,894,052		943,589
Pioneer Growth Opportunities VCT Portfolio		408,527		332,054
Pioneer Mid Cap Value VCT Portfolio		2,255,435		1,053,389
Pioneer Small Cap Value VCT Portfolio		2,100,000		2,414,376
Schwab Markettrack Growth Portfolio II		9,057,909		5,732,780
Schwab Money Market Portfolio		110,224,070		67,789,641
Schwab S&P 500 Index Portfolio		14,863,343		7,741,159
Seligman Communications & Information Fund		2,999,633		2,031,442
Third Avenue Value Portfolio		8,204,734		2,179,582
Van Kampen LIT Comstock		1,109,628		908,060
Van Kampen LIT Growth & Income		4,251,810		2,209,802
Wells Fargo Advantage VT Discovery Fund		2,320,165		1,075,167
Wells Fargo Advantage VT Opportunity Fund		1,641,265		959,862


Total	$	383,423,228	$	209,476,479


4.	EXPENSES AND RELATED PARTY TRANSACTIONS

	Contract Maintenance Charge

	The Company deducts from each participant account in the Schwab Select Annuity, a $25 annual maintenance charge on accounts under $50,000 as of each contract’s anniversary date.

	Transfer Fees

	The Company charges $10 in the Schwab Select Annuity for each transfer between investment divisions in excess of 12 transfers in any calendar year.


	Deductions for Premium Taxes

	The Company deducts from each contribution in both the Schwab Select Annuity and Schwab Signature Annuity any applicable state Premium Tax or retaliatory tax, which currently range from 0% to 3.5%.

	Deductions for Assumption of Mortality and Expense Risks

	The Company deducts an amount, computed daily, from the net asset value of the Schwab Select Annuity investments, equal to an annual rate of 0.85%, and an amount, computed daily, from the net asset value of the Schwab Signature Annuity investments, equal to an annual rate of 0.65% to 0.85% depending on the benefit option chosen. This charge compensates the Company for its assumption of certain mortality, death benefit, and expense risks.

	If the above charges prove insufficient to cover actual costs and assumed risks, the loss will be borne by the Company; conversely, if the amounts deducted prove more than sufficient, the excess will be a profit to the Company.

5.	FINANCIAL HIGHLIGHTS

	For Schwab Select Annuity, a summary of accumulation units outstanding for variable annuity contracts, the range of the lowest to highest expense ratio, excluding expenses of the underlying funds, the related total return and the related accumulation unit fair values for the five years ended December 31, 2007 is included on the following pages. For Schwab Signature Annuity, a summary of accumulation units outstanding for variable annuity contracts, the range of the lowest to highest expense ratio, excluding expenses of the underlying funds, the related total return and the related accumulation unit fair values for the five years ended December 31, 2007 is included on the following pages. The unit values in the Financial Highlights are calculated based on the net assets and accumulation units outstanding as of December 31 of each year presented and may differ from the unit value reflected on the Statement of Assets and Liabilities due to rounding. In certain instances the lowest unit fair value and total return exceed the highest due to the impact of contracts which were not inforce for the full year.

	The Expense Ratios represent the annualized contract expenses of the Series Account, consisting of mortality and expense charges, for each period indicated. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts through the redemption of units and expenses of the underlying fund have been excluded.

	The Total Return amounts represent the total return for the periods indicated, including changes in the value of the underlying fund, and expenses assessed through the reduction of unit values. These ratios do not include any expenses assessed through the redemption of units. The total return is calculated for each period shown and, accordingly, is not annualized for periods less than one year. As the total return for Schwab Signature Annuity for each of the periods in the five years ended December 31, 2007 is presented as a range of minimum to maximum values, based on the product grouping representing the minimum and maximum expense ratio amounts, some individual contract total returns are not within the ranges presented.

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31									For the year ended or period December 31

	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)			Expense Ratio lowest to highest					Total Return lowest to highest

Schwab Signature Annuity:

AIM V.I. HIGH YIELD FUND
2007		81	$	13.57	to	$	12.67	$	1,073		0.65	%	to	0.85	%		0.44	%	to	0.56	%
2006		103	$	13.51	to	$	12.60	$	1,325		0.65	%	to	0.85	%		9.75	%	to	10.04	%
2005		160	$	12.31	to	$	11.45	$	1,861		0.65	%	to	0.85	%		1.90	%	to	2.05	%
2004		306	$	11.20	to	$	12.08	$	3,469		0.65	%	to	0.85	%		9.94	%	to	10.16	%
2003		322	$	10.17	to	$	10.99	$	3,291		0.65	%	to	0.85	%		9.92	%	to	24.23	%
AIM V.I. INTERNATIONAL GROWTH FUND
2007		573	$	12.62	to	$	12.67	$	7,250		0.65	%	to	0.85	%		13.69	%	to	14.04	%
2006		164	$	11.10	to	$	11.11	$	1,824		0.65	%	to	0.85	%		11.00	%	to	11.10	%
AIM V.I. TECHNOLOGY FUND
2007		90	$	14.89	to	$	6.80	$	679		0.65	%	to	0.85	%		6.81	%	to	7.09	%
2006		116	$	13.94	to	$	6.35	$	809		0.65	%	to	0.85	%		9.59	%	to	9.67	%
2005		221	$	12.72	to	$	5.79	$	1,365		0.65	%	to	0.85	%		1.27	%	to	1.58	%
2004		225	$	5.69	to	$	12.56	$	1,325		0.65	%	to	0.85	%		3.75	%	to	3.96	%
2003		221	$	5.48	to	$	12.11	$	1,232		0.65	%	to	0.85	%		21.05	%	to	44.12	%
ALGER AMERICAN BALANCED PORTFOLIO
2007		167	$	13.63	to	$	13.00	$	2,185		0.65	%	to	0.85	%		11.36	%	to	11.68	%
2006		201	$	12.24	to	$	11.64	$	2,346		0.65	%	to	0.85	%		3.90	%	to	4.02	%
2005		355	$	11.78	to	$	11.19	$	3,996		0.65	%	to	0.85	%		7.48	%	to	7.70	%
2004		416	$	10.39	to	$	10.96	$	4,339		0.65	%	to	0.85	%		3.68	%	to	3.89	%
2003		431	$	9.98	to	$	10.57	$	4,313		0.65	%	to	0.85	%		5.72	%	to	18.26	%
ALGER AMERICAN GROWTH PORTFOLIO
2007		1,021	$	16.45	to	$	11.55	$	12,798		0.65	%	to	0.85	%		18.94	%	to	19.20	%
2006		541	$	13.83	to	$	9.69	$	5,619		0.65	%	to	0.85	%		4.22	%	to	4.42	%
2005		566	$	13.27	to	$	9.28	$	5,670		0.65	%	to	0.85	%		11.14	%	to	11.27	%
2004		528	$	8.32	to	$	11.94	$	4,699		0.65	%	to	0.85	%		4.61	%	to	4.81	%
2003		498	$	7.94	to	$	11.42	$	4,084		0.65	%	to	0.85	%		14.18	%	to	34.29	%
ALGER AMERICAN MIDCAP GROWTH PORTFOLIO
2007		447	$	20.87	to	$	21.06	$	9,415		0.65	%	to	0.85	%		30.44	%	to	30.73	%
2006		289	$	16.00	to	$	16.11	$	4,643		0.65	%	to	0.85	%		9.22	%	to	9.44	%
2005		260	$	14.65	to	$	14.72	$	3,827		0.65	%	to	0.85	%		8.92	%	to	9.12	%
2004		202	$	13.45	to	$	13.49	$	2,717		0.65	%	to	0.85	%		12.09	%	to	12.31	%
2003		157	$	12.00	to	$	12.01	$	1,887		0.65	%	to	0.85	%		20.02	%	to	20.15	%
ALLIANCE-BERNSTEIN VPS GROWTH & INCOME PORTFOLIO
2007		1,111	$	15.60	to	$	13.44	$	15,825		0.65	%	to	0.85	%		4.21	%	to	4.43	%
2006		1,062	$	14.97	to	$	12.87	$	14,450		0.65	%	to	0.85	%		16.32	%	to	16.58	%
2005		1,168	$	12.87	to	$	11.04	$	13,710		0.65	%	to	0.85	%		3.96	%	to	4.15	%
2004		1,129	$	10.58	to	$	12.38	$	12,700		0.65	%	to	0.85	%		10.52	%	to	10.74	%
2003		547	$	12.17	to	$	15.59	$	8,290		0.65	%	to	0.85	%		21.75	%	to	38.40	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31									For the year ended or period December 31

	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest						Total Return lowest to highest

Schwab Signature Annuity:

ALLIANCE-BERNSTEIN VPS GROWTH PORTFOLIO
2007		367	$	15.90	to	$	11.51	$	4,572		0.65	%	to	0.85	%		12.05	%	to	12.29	%
2006		314	$	14.19	to	$	10.25	$	3,442		0.65	%	to	0.85	%		(1.94	)%	to	(1.73	)%
2005		340	$	14.47	to	$	10.43	$	3,769		0.65	%	to	0.85	%		11.05	%	to	11.19	%
2004		258	$	9.36	to	$	13.03	$	2,534		0.65	%	to	0.85	%		13.76	%	to	13.99	%
2003		53	$	10.79	to	$	12.72	$	675		0.65	%	to	0.85	%		7.92	%	to	19.11	%
ALLIANCE-BERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO
2007		1,800	$	17.99	to	$	18.08	$	32,534		0.65	%	to	0.85	%		17.12	%	to	17.33	%
2006		1,354	$	15.36	to	$	15.41	$	20,840		0.65	%	to	0.85	%		26.00	%	to	26.21	%
2005		628	$	12.19	to	$	12.21	$	7,657		0.65	%	to	0.85	%		21.90	%	to	22.10	%
ALLIANCE-BERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO
2007		1,644	$	11.84	to	$	11.87	$	19,502		0.65	%	to	0.85	%		4.96	%	to	5.14	%
2006		930	$	11.28	to	$	11.29	$	10,496		0.65	%	to	0.85	%		12.80	%	to	12.90	%
ALLIANCE-BERNSTEIN VPS REAL ESTATE INVESTMENT PORTFOLIO
2007		557	$	20.60	to	$	26.60	$	14,252		0.65	%	to	0.85	%		(15.26	)%	to	(15.07	)%
2006		732	$	24.31	to	$	31.32	$	22,045		0.65	%	to	0.85	%		34.09	%	to	34.36	%
2005		643	$	18.13	to	$	23.31	$	14,600		0.65	%	to	0.85	%		10.75	%	to	10.95	%
2004		664	$	16.37	to	$	21.01	$	13,727		0.65	%	to	0.85	%		34.48	%	to	34.75	%
2003		836	$	9.56	to	$	11.20	$	8,115		0.65	%	to	0.85	%		12.02	%	to	31.65	%
ALLIANCE-BERNSTEIN VPS SMALL/MIDCAP VALUE PORTFOLIO
2007		239	$	10.56	to	$	10.59	$	2,528		0.65	%	to	0.85	%		0.86	%	to	1.05	%
2006		161	$	10.47	to	$	10.48	$	1,685		0.65	%	to	0.85	%		4.70	%	to	4.80	%
ALLIANCE-BERNSTEIN VPS UTILITY INCOME PORTFOLIO
2007		344	$	22.79	to	$	27.07	$	8,778		0.65	%	to	0.85	%		21.35	%	to	21.55	%
2006		298	$	18.78	to	$	22.27	$	6,344		0.65	%	to	0.85	%		22.66	%	to	22.97	%
2005		243	$	15.31	to	$	18.11	$	4,242		0.65	%	to	0.85	%		15.11	%	to	15.28	%
2004		167	$	13.30	to	$	15.71	$	2,557		0.65	%	to	0.85	%		23.28	%	to	23.52	%
2003		123	$	8.21	to	$	11.45	$	1,029		0.65	%	to	0.85	%		14.54	%	to	34.19	%
AMERICAN CENTURY VP BALANCED FUND
2007		397	$	13.75	to	$	13.87	$	5,497		0.65	%	to	0.85	%		4.09	%	to	4.21	%
2006		244	$	13.21	to	$	13.31	$	3,236		0.65	%	to	0.85	%		8.63	%	to	8.92	%
2005		268	$	12.16	to	$	12.22	$	3,270		0.65	%	to	0.85	%		4.11	%	to	4.27	%
2004		154	$	11.68	to	$	11.72	$	1,806		0.65	%	to	0.85	%		8.85	%	to	9.07	%
2003		40	$	10.73	to	$	10.75	$	434		0.65	%	to	0.85	%		7.33	%	to	7.46	%
AMERICAN CENTURY VP INCOME & GROWTH FUND
2007		516	$	15.21	to	$	12.99	$	7,019		0.65	%	to	0.85	%		(0.91	)%	to	(0.69	)%
2006		589	$	15.35	to	$	13.08	$	8,103		0.65	%	to	0.85	%		16.11	%	to	16.27	%
2005		658	$	13.22	to	$	11.25	$	7,793		0.65	%	to	0.85	%		3.77	%	to	3.97	%
2004		534	$	10.80	to	$	12.74	$	6,062		0.65	%	to	0.85	%		12.04	%	to	12.26	%
2003		283	$	9.62	to	$	11.37	$	2,789		0.65	%	to	0.85	%		13.73	%	to	28.52	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31										For the year ended or period December 31

	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest						Total Return lowest to highest

Schwab Signature Annuity:

AMERICAN CENTURY VP INTERNATIONAL FUND
2007		463	$	21.53	to	$	15.16	$	7,478		0.65	%	to	0.85	%	17.07	%	to	17.34	%
2006		575	$	18.39	to	$	12.92	$	7,896		0.65	%	to	0.85	%	23.92	%	to	24.23	%
2005		794	$	14.84	to	$	10.40	$	8,738		0.65	%	to	0.85	%	12.34	%	to	12.43	%
2004		525	$	9.23	to	$	13.21	$	5,123		0.65	%	to	0.85	%	13.95	%	to	14.18	%
2003		404	$	8.09	to	$	11.59	$	3,354		0.65	%	to	0.85	%	15.94	%	to	23.71	%
AMERICAN CENTURY VP VALUE FUND
2007		922	$	15.03	to	$	15.17	$	14,043		0.65	%	to	0.85	%	(5.94	)%	to	(5.72	)%
2006		820	$	15.98	to	$	16.09	$	13,163		0.65	%	to	0.85	%	17.67	%	to	17.88	%
2005		587	$	13.58	to	$	13.65	$	7,995		0.65	%	to	0.85	%	4.14	%	to	4.36	%
2004		301	$	13.04	to	$	13.08	$	3,936		0.65	%	to	0.85	%	13.37	%	to	13.59	%
2003		126	$	11.50	to	$	11.52	$	1,452		0.65	%	to	0.85	%	15.04	%	to	15.17	%
DELAWARE VIP GROWTH OPPORTUNITIES SERIES
2007		42	$	14.18	to	$	14.25	$	603		0.65	%	to	0.85	%	12.01	%	to	12.20	%
2006		31	$	12.66	to	$	12.70	$	389		0.65	%	to	0.85	%	5.50	%	to	5.66	%
2005		4	$	12.00	to	$	12.02	$	52		0.65	%	to	0.85	%	20.00	%	to	20.20	%
DELAWARE VIP SMALL CAP VALUE SERIES
2007		969	$	16.88	to	$	19.88	$	18,578		0.65	%	to	0.85	%	(7.41	)%	to	(7.23	)%
2006		1,133	$	18.23	to	$	21.43	$	23,449		0.65	%	to	0.85	%	15.23	%	to	15.40	%
2005		1,143	$	15.82	to	$	18.57	$	20,502		0.65	%	to	0.85	%	8.50	%	to	8.72	%
2004		1,003	$	14.58	to	$	17.08	$	16,697		0.65	%	to	0.85	%	20.45	%	to	20.70	%
2003		800	$	12.11	to	$	14.15	$	11,153		0.65	%	to	0.85	%	21.07	%	to	41.07	%
DREYFUS IP MIDCAP STOCK PORTFOLIO
2007		135	$	15.37	to	$	15.51	$	2,096		0.65	%	to	0.85	%	0.65	%	to	0.85	%
2006		134	$	15.27	to	$	15.38	$	2,049		0.65	%	to	0.85	%	6.86	%	to	7.03	%
2005		142	$	14.29	to	$	14.37	$	2,038		0.65	%	to	0.85	%	8.26	%	to	8.53	%
2004		84	$	13.20	to	$	13.24	$	1,108		0.65	%	to	0.85	%	13.50	%	to	13.75	%
2003		30	$	11.63	to	$	11.64	$	346		0.65	%	to	0.85	%	16.32	%	to	16.44	%
DREYFUS VIF APPRECIATION PORTFOLIO
2007		124	$	13.01	to	$	13.11	$	1,621		0.65	%	to	0.85	%	6.20	%	to	6.50	%
2006		88	$	12.25	to	$	12.31	$	1,081		0.65	%	to	0.85	%	15.46	%	to	15.70	%
2005		15	$	10.61	to	$	10.64	$	156		0.65	%	to	0.85	%	3.51	%	to	3.70	%
2004		2	$	10.25	to	$	10.26	$	16		0.65	%	to	0.85	%	2.49	%	to	2.62	%
DREYFUS VIF DEVELOPING LEADERS PORTFOLIO
2007		100	$	12.43	to	$	10.90	$	1,096		0.65	%	to	0.85	%	(11.78	)%	to	(11.67	)%
2006		127	$	14.09	to	$	12.34	$	1,574		0.65	%	to	0.85	%	2.85	%	to	3.09	%
2005		172	$	13.70	to	$	11.97	$	2,077		0.65	%	to	0.85	%	4.98	%	to	5.09	%
2004		217	$	11.34	to	$	13.05	$	2,492		0.65	%	to	0.85	%	10.40	%	to	10.62	%
2003		143	$	8.69	to	$	11.20	$	1,252		0.65	%	to	0.85	%	12.02	%	to	25.76	%

(Continued )

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31								For the year ended or period December 31

	Units (000s)	Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest					Total Return lowest to highest

Schwab Signature Annuity:

DREYFUS VIF GROWTH & INCOME PORTFOLIO
2007	121	$	14.94	to	$	11.70	$	1,455	0.65	%	to	0.85	%	7.56	%	to	7.73	%
2006	155	$	13.89	to	$	10.86	$	1,740	0.65	%	to	0.85	%	13.57	%	to	13.84	%
2005	160	$	12.23	to	$	9.54	$	1,567	0.65	%	to	0.85	%	2.43	%	to	2.69	%
2004	154	$	9.28	to	$	11.94	$	1,462	0.65	%	to	0.85	%	6.56	%	to	6.77	%
2003	225	$	10.26	to	$	11.83	$	2,323	0.65	%	to	0.85	%	18.25	%	to	30.84	%
DWS BLUE CHIP VIP PORTFOLIO
2007	549	$	13.18	to	$	13.25	$	7,281	0.65	%	to	0.85	%	2.65	%	to	2.79	%
2006	280	$	12.84	to	$	12.89	$	3,604	0.65	%	to	0.85	%	14.64	%	to	14.88	%
2005	11	$	11.20	to	$	11.22	$	119	0.65	%	to	0.85	%	12.00	%	to	12.20	%
DWS CAPITAL GROWTH VIP PORTFOLIO
2007	267	$	15.45	to	$	10.87	$	3,182	0.65	%	to	0.85	%	11.63	%	to	11.83	%
2006	215	$	13.84	to	$	9.72	$	2,261	0.65	%	to	0.85	%	7.62	%	to	7.88	%
2005	213	$	12.86	to	$	9.01	$	2,129	0.65	%	to	0.85	%	7.98	%	to	8.29	%
2004	165	$	8.31	to	$	8.24	$	1,454	0.65	%	to	0.85	%	7.07	%	to	7.29	%
2003	111	$	7.75	to	$	11.12	$	888	0.65	%	to	0.85	%	11.19	%	to	26.07	%
DWS DREMAN HIGH RETURN EQUITY VIP PORTFOLIO
2007	617	$	12.36	to	$	12.43	$	7,661	0.65	%	to	0.85	%	(2.68	)%	to	(2.43	)%
2006	706	$	12.70	to	$	12.74	$	8,987	0.65	%	to	0.85	%	17.70	%	to	17.96	%
2005	76	$	10.79	to	$	10.80	$	822	0.65	%	to	0.85	%	7.90	%	to	8.00	%
DWS DREMAN SMALL MID CAP VALUE VIP PORTFOLIO
2007	294	$	10.83	to	$	10.86	$	3,190	0.65	%	to	0.85	%	2.27	%	to	2.36	%
2006	181	$	10.59	to	$	10.61	$	1,925	0.65	%	to	0.85	%	5.90	%	to	6.10	%
DWS HEALTH CARE VIP PORTFOLIO
2007	228	$	12.01	to	$	12.05	$	2,747	0.65	%	to	0.85	%	12.24	%	to	12.51	%
2006	94	$	10.70	to	$	10.71	$	1,009	0.65	%	to	0.85	%	7.00	%	to	7.10	%
DWS LARGE CAP VALUE VIP PORTFOLIO
2007	253	$	13.44	to	$	13.51	$	3,407	0.65	%	to	0.85	%	12.19	%	to	12.40	%
2006	121	$	11.98	to	$	12.02	$	1,457	0.65	%	to	0.85	%	14.42	%	to	14.69	%
2005	106	$	10.47	to	$	10.48	$	1,109	0.65	%	to	0.85	%	4.70	%	to	4.80	%
DWS SMALL CAP GROWTH VIP PORTFOLIO
2007	112	$	14.65	to	$	9.69	$	1,248	0.65	%	to	0.85	%	5.32	%	to	5.44	%
2006	145	$	13.91	to	$	9.19	$	1,493	0.65	%	to	0.85	%	4.43	%	to	4.67	%
2005	228	$	13.32	to	$	8.78	$	2,160	0.65	%	to	0.85	%	6.14	%	to	6.30	%
2004	227	$	8.24	to	$	12.55	$	2,035	0.65	%	to	0.85	%	10.08	%	to	10.31	%
2003	215	$	7.47	to	$	11.40	$	1,658	0.65	%	to	0.85	%	14.01	%	to	32.09	%
DWS SMALL CAP INDEX VIP PORTFOLIO
2007	492	$	16.95	to	$	16.00	$	7,965	0.65	%	to	0.85	%	(2.75	)%	to	(2.56	)%
2006	441	$	17.43	to	$	16.42	$	7,299	0.65	%	to	0.85	%	16.51	%	to	16.79	%
2005	446	$	14.96	to	$	14.06	$	6,339	0.65	%	to	0.85	%	3.39	%	to	3.61	%
2004	548	$	13.55	to	$	14.47	$	7,548	0.65	%	to	0.85	%	16.76	%	to	17.00	%
2003	429	$	11.59	to	$	12.39	$	5,019	0.65	%	to	0.85	%	23.94	%	to	45.48	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31								For the year ended or period December 31

	Units (000s)	Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest					Total Return lowest to highest

Schwab Signature Annuity:

FEDERATED FUND FOR U.S. GOVERNMENT SECURITIES II
2007	1,677	$	11.23	to	$	12.39	$	20,544	0.65	%	to	0.85	%	5.45	%	to	5.63	%
2006	1,603	$	10.65	to	$	11.73	$	18,539	0.65	%	to	0.85	%	3.20	%	to	3.44	%
2005	1,612	$	10.32	to	$	11.34	$	18,030	0.65	%	to	0.85	%	1.18	%	to	1.34	%
2004	1,486	$	10.20	to	$	11.19	$	16,417	0.65	%	to	0.85	%	2.73	%	to	2.94	%
2003	1,448	$	9.93	to	$	10.87	$	15,679	0.65	%	to	0.85	%	(0.72	)%	to	1.70	%
FEDERATED INTERNATIONAL EQUITY FUND II
2007	123	$	18.72	to	$	12.49	$	1,703	0.65	%	to	0.85	%	8.58	%	to	8.89	%
2006	178	$	17.24	to	$	11.47	$	2,203	0.65	%	to	0.85	%	17.92	%	to	18.13	%
2005	215	$	14.62	to	$	9.71	$	2,252	0.65	%	to	0.85	%	8.14	%	to	8.37	%
2004	265	$	8.95	to	$	13.52	$	2,556	0.65	%	to	0.85	%	13.10	%	to	13.28	%
2003	149	$	7.91	to	$	11.95	$	1,222	0.65	%	to	0.85	%	19.55	%	to	31.12	%
FRANKLIN SMALL CAP VALUE SECURITIES FUND
2007	62	$	9.86	to	$	9.89	$	612	0.65	%	to	0.85	%	(3.24	)%	to	(3.04	)%
2006	28	$	10.19	to	$	10.20	$	285	0.65	%	to	0.85	%	1.90	%	to	2.00	%
JANUS ASPEN BALANCED PORTFOLIO INSTITUTIONAL SHARES
2007	730	$	14.56	to	$	14.70	$	10,701	0.65	%	to	0.85	%	9.56	%	to	9.87	%
2006	683	$	13.29	to	$	13.38	$	9,120	0.65	%	to	0.85	%	9.74	%	to	9.94	%
2005	281	$	12.11	to	$	12.17	$	3,415	0.65	%	to	0.85	%	7.07	%	to	7.32	%
2004	127	$	11.31	to	$	11.34	$	1,434	0.65	%	to	0.85	%	7.61	%	to	7.82	%
2003	31	$	10.51	to	$	10.52	$	327	0.65	%	to	0.85	%	5.10	%	to	5.21	%
JANUS ASPEN BALANCED PORTFOLIO SERVICE SHARES
2007	628	$	10.42	to	$	10.43	$	6,549	0.65	%	to	0.85	%	4.20	%	to	4.30	%
JANUS ASPEN FLEXIBLE BOND PORTFOLIO INSTITUTIONAL SHARES
2007	1,372	$	11.27	to	$	13.92	$	18,229	0.65	%	to	0.85	%	6.12	%	to	6.34	%
2006	1,519	$	10.62	to	$	13.09	$	19,011	0.65	%	to	0.85	%	3.31	%	to	3.56	%
2005	1,498	$	10.28	to	$	12.64	$	18,365	0.65	%	to	0.85	%	1.18	%	to	1.29	%
2004	1,361	$	10.16	to	$	12.48	$	16,581	0.65	%	to	0.85	%	3.09	%	to	3.29	%
2003	1,335	$	9.86	to	$	12.08	$	15,960	0.65	%	to	0.85	%	(1.40	)%	to	5.70	%
JANUS ASPEN FLEXIBLE BOND PORTFOLIO SERVICE SHARES
2007	589	$	10.42	to	$	10.43	$	6,193	0.65	%	to	0.85	%	4.20	%	to	4.30	%
JANUS ASPEN GROWTH & INCOME PORTFOLIO INSTITUTIONAL SHARES
2007	1,315	$	15.96	to	$	9.99	$	15,434	0.65	%	to	0.85	%	7.84	%	to	8.12	%
2006	1,529	$	14.80	to	$	9.24	$	16,027	0.65	%	to	0.85	%	7.17	%	to	7.32	%
2005	889	$	13.81	to	$	8.61	$	8,228	0.65	%	to	0.85	%	11.37	%	to	11.53	%
2004	355	$	7.71	to	$	12.40	$	2,992	0.65	%	to	0.85	%	10.99	%	to	11.22	%
2003	134	$	6.93	to	$	11.17	$	1,002	0.65	%	to	0.85	%	11.71	%	to	25.51	%
JANUS ASPEN GROWTH & INCOME PORTFOLIO SERVICE SHARES
2007	470	$	10.21	to	$	10.23	$	4,808	0.65	%	to	0.85	%	2.10	%	to	2.30	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF

GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31									For the year ended or period December 31

	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest						Total Return lowest to highest

Schwab Signature Annuity:

JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO
2007		103	$	15.89	to	$	10.81	$	1,249		0.65	%	to	0.85	%		8.76	%	to	8.86	%
2006		152	$	14.61	to	$	9.93	$	1,650		0.65	%	to	0.85	%		17.16	%	to	17.51	%
2005		181	$	12.47	to	$	8.45	$	1,649		0.65	%	to	0.85	%		4.97	%	to	5.10	%
2004		233	$	8.02	to	$	11.88	$	1,973		0.65	%	to	0.85	%		3.89	%	to	4.10	%
2003		333	$	7.71	to	$	11.43	$	2,677		0.65	%	to	0.85	%		14.34	%	to	23.19	%
JPMORGAN SMALL COMPANY PORTFOLIO
2007		124	$	16.89	to	$	14.32	$	1,823		0.65	%	to	0.85	%		(6.43	)%	to	(6.28	)%
2006		171	$	18.05	to	$	15.28	$	2,655		0.65	%	to	0.85	%		14.02	%	to	14.29	%
2005		182	$	15.83	to	$	13.37	$	2,468		0.65	%	to	0.85	%		2.53	%	to	2.77	%
2004		225	$	12.99	to	$	15.44	$	2,951		0.65	%	to	0.85	%		26.10	%	to	26.35	%
2003		396	$	10.28	to	$	12.24	$	4,078		0.65	%	to	0.85	%		22.44	%	to	35.10	%
LVIP BARON GROWTH OPPORTUNITIES PORTFOLIO
2007		642	$	17.51	to	$	17.67	$	11,306		0.65	%	to	0.85	%		2.52	%	to	2.73	%
2006		558	$	17.08	to	$	17.20	$	9,573		0.65	%	to	0.85	%		14.55	%	to	14.74	%
2005		535	$	14.91	to	$	14.99	$	8,004		0.65	%	to	0.85	%		2.47	%	to	2.74	%
2004		404	$	14.55	to	$	14.59	$	5,886		0.65	%	to	0.85	%		24.58	%	to	24.83	%
2003		64	$	11.68	to	$	11.69	$	752		0.65	%	to	0.85	%		16.78	%	to	16.91	%
NEUBERGER BERMAN AMT REGENCY PORTFOLIO
2007		64	$	10.43	to	$	10.47	$	667		0.65	%	to	0.85	%		2.15	%	to	2.45	%
2006		42	$	10.21	to	$	10.22	$	429		0.65	%	to	0.85	%		2.10	%	to	2.20	%
NVIT MID CAP INDEX FUND
2007		512	$	17.50	to	$	17.66	$	9,034		0.65	%	to	0.85	%		6.45	%	to	6.71	%
2006		467	$	16.44	to	$	16.55	$	7,713		0.65	%	to	0.85	%		8.80	%	to	9.03	%
2005		454	$	15.11	to	$	15.18	$	6,883		0.65	%	to	0.85	%		10.94	%	to	11.13	%
2004		279	$	13.62	to	$	13.66	$	3,806		0.65	%	to	0.85	%		14.54	%	to	14.75	%
2003		96	$	11.89	to	$	11.90	$	1,138		0.65	%	to	0.85	%		18.88	%	to	19.00	%
OLD MUTUAL LARGE CAP GROWTH PORTFOLIO
2007		185	$	15.74	to	$	10.83	$	2,066		0.65	%	to	0.85	%		18.52	%	to	18.75	%
2006		198	$	13.28	to	$	9.12	$	1,866		0.65	%	to	0.85	%		4.65	%	to	4.95	%
2005		296	$	12.69	to	$	8.69	$	2,709		0.65	%	to	0.85	%		3.68	%	to	3.82	%
2004		332	$	8.35	to	$	12.24	$	2,914		0.65	%	to	0.85	%		8.03	%	to	8.24	%
2003		252	$	7.72	to	$	11.33	$	1,977		0.65	%	to	0.85	%		13.28	%	to	30.34	%
OPPENHEIMER GLOBAL SECURITIES FUND/VA
2007		1,589	$	20.73	to	$	17.30	$	28,844		0.65	%	to	0.85	%		5.44	%	to	5.62	%
2006		1,499	$	19.66	to	$	16.38	$	25,484		0.65	%	to	0.85	%		16.68	%	to	16.92	%
2005		1,421	$	16.85	to	$	14.01	$	20,589		0.65	%	to	0.85	%		13.32	%	to	13.53	%
2004		1,055	$	12.31	to	$	14.87	$	13,432		0.65	%	to	0.85	%		18.16	%	to	18.39	%
2003		671	$	10.41	to	$	12.58	$	7,073		0.65	%	to	0.85	%		25.82	%	to	42.10	%
OPPENHEIMER INTERNATIONAL GROWTH FUND/VA
2007		820	$	17.07	to	$	17.16	$	14,056		0.65	%	to	0.85	%		11.64	%	to	11.86	%
2006		542	$	15.29	to	$	15.34	$	8,313		0.65	%	to	0.85	%		29.69	%	to	30.00	%
2005		171	$	11.79	to	$	11.80	$	2,013		0.65	%	to	0.85	%		17.90	%	to	18.00	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31									For the year ended or period December 31

	Units (000s)		Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest						Total Return lowest to highest

Schwab Signature Annuity:
PIMCO VIT HIGH YIELD PORTFOLIO
2007		1,301	$	13.20	to	$	16.63	$	20,373		0.65	%	to	0.85	%		2.64	%	to	2.91	%
2006		1,062	$	12.86	to	$	16.16	$	16,161		0.65	%	to	0.85	%		8.16	%	to	8.31	%
2005		813	$	11.89	to	$	14.92	$	11,406		0.65	%	to	0.85	%		3.21	%	to	3.47	%
2004		709	$	11.52	to	$	14.42	$	9,750		0.65	%	to	0.85	%		8.62	%	to	8.83	%
2003		622	$	10.61	to	$	13.25	$	7,939		0.65	%	to	0.85	%		6.08	%	to	22.14	%
PIMCO VIT LOW DURATION BOND PORTFOLIO
2007		2,813	$	11.00	to	$	11.11	$	31,297		0.65	%	to	0.85	%		6.38	%	to	6.72	%
2006		2,548	$	10.34	to	$	10.41	$	26,461		0.65	%	to	0.85	%		3.09	%	to	3.27	%
2005		2,216	$	10.03	to	$	10.08	$	22,296		0.65	%	to	0.85	%		0.20	%	to	0.40	%
2004		1,611	$	10.01	to	$	10.04	$	16,166		0.65	%	to	0.85	%		0.99	%	to	1.19	%
2003		679	$	9.91	to	$	9.93	$	6,735		0.65	%	to	0.85	%		(0.86	)%	to	(0.75	)%
PIMCO VIT TOTAL RETURN PORTFOLIO
2007		4,609	$	11.17	to	$	11.23	$	51,766		0.65	%	to	0.85	%		7.82	%	to	8.08	%
2006		3,350	$	10.36	to	$	10.39	$	34,792		0.65	%	to	0.85	%		2.98	%	to	3.08	%
2005		529	$	10.06	to	$	10.08	$	5,327		0.65	%	to	0.85	%		0.60	%	to	0.80	%
PIONEER FUND VCT PORTFOLIO
2007		197	$	14.96	to	$	11.76	$	2,473		0.65	%	to	0.85	%		4.11	%	to	4.35	%
2006		125	$	14.37	to	$	11.27	$	1,488		0.65	%	to	0.85	%		15.61	%	to	15.83	%
2005		94	$	12.43	to	$	9.73	$	949		0.65	%	to	0.85	%		5.25	%	to	5.53	%
2004		94	$	9.21	to	$	11.81	$	890		0.65	%	to	0.85	%		6.78	%	to	7.00	%
2003		71	$	8.61	to	$	11.06	$	625		0.65	%	to	0.85	%		10.55	%	to	23.97	%
PIONEER GROWTH OPPORTUNITIES VCT PORTFOLIO
2007		36	$	9.28	to	$	9.31	$	331		0.65	%	to	0.85	%		(4.62	)%	to	(4.51	)%
2006		32	$	9.73	to	$	9.75	$	308		0.65	%	to	0.85	%		(2.70	)%	to	(2.50	)%
PIONEER MID CAP VALUE VCT PORTFOLIO
2007		113	$	11.10	to	$	11.14	$	1,253		0.65	%	to	0.85	%		4.42	%	to	4.70	%
2006		17	$	10.63	to	$	10.64	$	176		0.65	%	to	0.85	%		6.30	%	to	6.40	%
PIONEER SMALL CAP VALUE VCT PORTFOLIO
2007		262	$	17.29	to	$	17.45	$	4,580		0.65	%	to	0.85	%		(7.74	)%	to	(7.53	)%
2006		339	$	18.74	to	$	18.87	$	6,383		0.65	%	to	0.85	%		11.35	%	to	11.52	%
2005		295	$	16.83	to	$	16.92	$	4,989		0.65	%	to	0.85	%		13.95	%	to	14.19	%
2004		327	$	14.77	to	$	14.82	$	4,840		0.65	%	to	0.85	%		21.27	%	to	21.52	%
2003		59	$	12.18	to	$	12.19	$	713		0.65	%	to	0.85	%		21.78	%	to	21.92	%
SCHWAB MARKETTRACK GROWTH PORTFOLIO II
2007		1,461	$	15.69	to	$	14.02	$	21,017		0.65	%	to	0.85	%		4.74	%	to	5.02	%
2006		1,284	$	14.98	to	$	13.35	$	17,781		0.65	%	to	0.85	%		14.00	%	to	14.20	%
2005		907	$	13.14	to	$	11.69	$	11,011		0.65	%	to	0.85	%		4.87	%	to	5.13	%
2004		759	$	11.10	to	$	12.53	$	8,745		0.65	%	to	0.85	%		10.63	%	to	10.85	%
2003		630	$	10.02	to	$	11.32	$	6,530		0.65	%	to	0.85	%		13.21	%	to	26.15	%

(Continued)

VARIABLE ANNUITY-1 SERIES ACCOUNT OF
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY


	At December 31								For the year ended or period December 31

	Units (000s)	Unit Fair Value lowest to highest					Net Assets (000s)		Expense Ratio lowest to highest					Total Return lowest to highest

Schwab Signature Annuity:

SCHWAB MONEY MARKET PORTFOLIO
2007	10,419	$	10.97	to	$	11.32	$	117,373	0.65	%	to	0.85	%		3.88	%	to	4.04	%
2006	6,805	$	10.56	to	$	10.88	$	73,495	0.65	%	to	0.85	%		3.73	%	to	3.92	%
2005	5,245	$	10.18	to	$	10.47	$	54,534	0.65	%	to	0.85	%		1.90	%	to	2.15	%
2004	4,300	$	9.99	to	$	10.25	$	43,824	0.65	%	to	0.85	%		0.05	%	to	0.25	%
2003	4,985	$	9.99	to	$	10.23	$	50,780	0.65	%	to	0.85	%		(0.12	)%	to	0.09	%
SCHWAB S&P 500 INDEX PORTFOLIO
2007	5,398	$	15.38	to	$	12.44	$	70,526	0.65	%	to	0.85	%		4.48	%	to	4.63	%
2006	4,932	$	14.72	to	$	11.89	$	61,351	0.65	%	to	0.85	%		14.64	%	to	14.88	%
2005	4,530	$	12.84	to	$	10.35	$	49,312	0.65	%	to	0.85	%		3.80	%	to	4.02	%
2004	4,336	$	9.93	to	$	12.37	$	44,717	0.65	%	to	0.85	%		9.60	%	to	9.81	%
2003	3,113	$	9.05	to	$	11.28	$	28,666	0.65	%	to	0.85	%		12.83	%	to	27.39	%
SELIGMAN COMMUNICATIONS & INFORMATION FUND
2007	148	$	12.11	to	$	12.15	$	1,799	0.65	%	to	0.85	%		14.14	%	to	14.41	%
2006	72	$	10.61	to	$	10.62	$	767	0.65	%	to	0.85	%		6.10	%	to	6.20	%
THIRD AVENUE VALUE PORTFOLIO
2007	1,109	$	9.73	to	$	9.77	$	10,827	0.65	%	to	0.85	%		(5.63	)%	to	(5.42	)%
2006	621	$	10.31	to	$	10.33	$	6,411	0.65	%	to	0.85	%		3.10	%	to	3.30	%
VAN KAMPEN LIT COMSTOCK
2007	160	$	11.88	to	$	11.95	$	1,903	0.65	%	to	0.85	%		(2.86	)%	to	(2.61	)%
2006	148	$	12.23	to	$	12.27	$	1,814	0.65	%	to	0.85	%		15.27	%	to	15.54	%
2005	36	$	10.61	to	$	10.62	$	380	0.65	%	to	0.85	%		6.10	%	to	6.20	%
VAN KAMPEN LIT GROWTH & INCOME
2007	521	$	12.94	to	$	13.01	$	6,765	0.65	%	to	0.85	%		1.97	%	to	2.12	%
2006	385	$	12.69	to	$	12.74	$	4,894	0.65	%	to	0.85	%		15.26	%	to	15.50	%
2005	86	$	11.01	to	$	11.03	$	948	0.65	%	to	0.85	%		10.10	%	to	10.30	%
WELLS FARGO ADVANTAGE VT DISCOVERY FUND
2007	431	$	19.36	to	$	11.86	$	5,492	0.65	%	to	0.85	%		21.30	%	to	21.52	%
2006	334	$	15.96	to	$	9.76	$	3,445	0.65	%	to	0.85	%		13.76	%	to	13.89	%
2005	293	$	14.03	to	$	8.57	$	2,610	0.65	%	to	0.85	%		8.59	%	to	8.89	%
2004	309	$	7.85	to	$	12.92	$	2,694	0.65	%	to	0.85	%		18.15	%	to	18.39	%
2003	281	$	6.64	to	$	10.93	$	1,883	0.65	%	to	0.85	%		9.33	%	to	33.35	%
WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND
2007	281	$	17.15	to	$	13.99	$	4,270	0.65	%	to	0.85	%		5.73	%	to	5.98	%
2006	279	$	16.22	to	$	13.20	$	3,939	0.65	%	to	0.85	%		11.25	%	to	11.49	%
2005	318	$	14.58	to	$	11.84	$	4,080	0.65	%	to	0.85	%		6.97	%	to	7.16	%
2004	410	$	11.03	to	$	13.63	$	4,850	0.65	%	to	0.85	%		17.21	%	to	17.45	%
2003	475	$	9.39	to	$	11.63	$	4,534	0.65	%	to	0.85	%		16.25	%	to	36.12	%

(Concluded)

PART C

OTHER INFORMATION

Item 24.

Financial Statements and Exhibits

(a)

Financial Statements

The consolidated financial statements of GWL&A as of December 31, 2007 and 2006 and for each of the three years in the period ended December 31, 2006, as well as the financial statements of the Variable Annuity-1 Series Account of Great-West Life & Annuity Insurance Company for the year ended December 31, 2007, by investment division, are included in Part B of the Registration Statement.

(b)

Exhibits

(1) Certified copy of resolution of Board of Directors of Depositor authorizing the establishment of Registrant is incorporated by reference to the Registrant’s initial Registration Statement on Form N-4 filed on February 22, 1996 (File No. 333-01153).

(2)

Not applicable.

(3) Underwriting agreement between Depositor and GWFS Equities, Inc. (formerly, BenefitsCorp Equities, Inc.) is incorporated by reference to Post Effective Amendment No. 8 to Registrant’s Registration Statement on Form N-4, filed on April 21, 2003, (File No. 333-52956).

(4)(a) Forms of the variable annuity contracts are incorporated by reference to Pre-Effective Amendment No. 1 to Registrant’s Registration Statement on Form N-4, filed April 24, 2001 (File No. 333-52956).

(4)(b)Death Benefit Option 2 endorsement is incorporated by reference to Post-Effective Amendment No. 14 to Registrant’s Registration Statement on Form N-4, filed May 3, 2004 (File No. 333-52956).

(5)(a) Forms of applications are incorporated by reference to Pre-Effective Amendment No. 1 to Registrant’s Registration Statement on Form N-4 filed April 24, 2001 (File No. 333-52956).

(5)(b) Form of revised application to add new Portfolio investment options is incorporated by reference to Post-Effective Amendment No. 16 to Registrant’s Registration Statement on Form N-4, filed on April 29, 2005 (File No. 333-52956).

(6)(a) Articles of Incorporation of Depositor is incorporated by reference to Pre-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-4 filed on October 30, 1996 (File No. 811-07549).

(6)(b) Bylaws of Depositor is incorporated by reference to Pre-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form N-4 filed on October 30, 1996 (File No. 811-07549); Amended Bylaws of Depositor are incorporated by reference to Post-Effective Amendment No. 38 to the Registration Statement filed by FutureFunds Series Account on Form N-4 on April 24, 2006 (File No. 811-03972).

(7) Not applicable.

(8)(a) Participation agreements and amendments thereto with underlying funds are incorporated by reference to Pre-Effective Amendment No. 2 to Registrant’s Registration Statement on Form N-4, filed October 30, 1996 (File No. 811-07549); Post-Effective

Amendment No. 1 to Registrant’s Registration Statement on Form N-4, filed April 28, 1997 (File No. 333-01153); Pre-Effective Amendment No. 1 to Registrant’s Registration Statement on Form N-4, filed April 24, 2001 (File No. 333-52956); Post-Effective Amendment No. 8 to Registrant’s Registration Statement on Form N-4, filed April 12, 2002 (File No. 333-01153); Post-Effective Amendment No. 3 to Registrant’s Registration Statement on Form N-4, filed April 16, 2002 (File No. 333-52956); Post-Effective Amendment No. 9 to Registrant's Registration Statement on Form N-4, filed April 18, 2003 (File No. 333-01153); Post-Effective Amendment No. 10 to Registrant’s Registration Statement on Form N-4, filed May 29, 2003 (File No. 333-52956); and form of amendments to participation agreements with AllianceBernstein, Delaware, Oppenheimer, PIMCO and Scudder are incorporated by reference to Post-Effective Amendment No. 16 on Form N-4 filed on April 29, 2005 (File No. 333-52956). Form of participation agreements with Neuberger Berman Advisers Management Trust and Third Avenue Capital Management are incorporated by reference to Post-Effective Amendment No. 17 on Form N-4 filed on April 28, 2006 (File No. 333-52956). Forms of participation agreements with AIM Variable Insurance Fund and Van Kampen Life Insurance Trust, Van Kampen Funds, Inc. and Van Kampen Asset Management are filed herewith.

(8)(b) Form of Rule 22c-2 Shareholder Information Agreement is incorporated by reference to the Registrant's Post-Effective Amendment No. 18 to the Registration Statement, filed on April 26, 2007 (File No. 333-52956).

(9) Opinion of counsel and consent of Beverly A. Byrne, Vice President, Counsel and Associate Secretary is incorporated by reference to the initial Registration Statement filed by Registrant on Form N-4 on December 29, 2000, (File No. 333-52956).

(10)

(a) Written Consent of legal counsel is filed herewith.

(b)

Written Consent of independent registered public accounting firm is filed herewith.

(11) Not Applicable.

(12) Not Applicable.

(13)

Powers of Attorney for Messrs. Orr, Mackness, and, Ryan are filed herewith. Powers of Attorney for Messrs. Balog, Bernbach, Dachow, A. Desmarais, P. Desmarais, Jr., Gratton, Kavanagh, Louvel, McCallum, Nickerson, Nield, Plessis-Bélair and Walsh are incorporated by reference to the Registrant's Post-Effective Amendment No. 18 to the Registration Statement, filed on April 26, 2007 (File No. 333-52956)..

C-5

Item 25.

Directors and Officers of the Depositor

C-5

Name	Principal Business Address	Positions and Offices with Depositor
J. Balog	2205 North Southwinds Boulevard, Apt. 307 Vero Beach, FL 32963	Director
J.L. Bernbach	32 East 57^th Street, 10^th Floor New York, NY 10022	Director
O. T. Dackow	8515 East Orchard Road Greenwood Village, CO 80111	Director
A. Desmarais	Power Corporation of Canada 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Director
P. Desmarais, Jr.	Power Corporation of Canada 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Director
R. Gratton	Power Financial Corporation 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Chairman
K. P. Kavanagh	100 Osborne Street North Winnipeg, Manitoba, Canada R3C 3A5	Director
A. Louvel	P.O. Box 1073 38 Beach Lane Wainscott, NY 11975	Director
W. Mackness	696 Whitehaven Crescent London, Ontario, Canada N6G 4V4	Director
W. T. McCallum	8515 East Orchard Road Greenwood Village, CO 80111	Vice-Chairman
R. L. McFeetors	8515 East Orchard Road Greenwood Village, CO 80111	Director, President and Chief Executive Officer
J. E. A. Nickerson	H.B. Nickerson & Sons Limited P.O. Box 130 255 Commercial Street North Sydney, Nova Scotia, Canada B2A 3M2	Director
D. A. Nield	330 University Avenue Toronto, Ontario, Canada M5G 1R8	Director
P.K. Ryan	Power Corporation of Canada 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Director
R.J. Orr	Power Financial Corporation 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Director
M. Plessis-Bélair	Power Corporation of Canada 751 Victoria Square, Montreal, Quebec, Canada H2Y 2J3	Director
B. E. Walsh	Saguenay Capital, LLC Two Manhattanville Rd, #403 Purchase, New York 10577	Director
S. M. Corbett	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Investments
C. H. Cumming	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Marketing, Healthcare and Jumbo 401(k)
G. R. Derback	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President and Controller

M. R. Edwards	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, FASCore Operations
T. L. Fouts	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President and Chief Medical Officer
J. R. Gabbert	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President and Chief Healthcare Information Officer
M. T. G. Graye	8515 East Orchard Road Greenwood Village, CO 80111	Executive Vice President and Chief Financial Officer
D. A. Goldin	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Healthcare Operations
C. M. Knackstedt	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Healthcare Management
R. J. Laeyendecker	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Executive Benefits Markets
J. L. McCallen	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President and Actuary
S. A. Miller	8525 East Orchard Road Greenwood Village, CO 80222	Senior Vice President, FASCore Systems
G. R. McDonald	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Corporate Resources
C. P. Nelson	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Retirement Services
R. F. Rivers	8505 East Orchard Road Greenwood Village, CO 80111	Executive Vice President, Healthcare
M. Rosenbaum	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Healthcare Finance
G. E. Seller	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Government Markets
R. K. Shaw	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Individual Markets
D. J. Stefanson	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, Healthcare Underwriting
George Webb	8505 East Orchard Road Greenwood Village, CO 80111	Senior Vice President, P/NP Operations

Item 26.

Persons controlled by or under common control with the Depositor or Registrant as of 12/31/07

(State/Country of Organization) - Nature of Business

OWNERSHIP OF POWER CORPORATION OF CANADA

The following sets out the ownership, based on votes attached to the outstanding voting shares, of Power Corporation of Canada:

Paul G. Desmarais

99.999% - Pansolo Holding Inc.

100% - 3876357 Canada Inc

100% - 3439496 Canada Inc.

100% - Capucines Investments Corporation

100% - Ramezay Investments Corporation

100% - Ansopolo Investments Corporation

32% - Nordex Inc. (68% also owned directly by Paul G. Desmarais)

94.9% - Gelco Enterprises Ltd. (5.1% also owned directly by Paul G. Desmarais)

54% - Power Corporation of Canada

II.

OWNERSHIP BY POWER CORPORATION OF CANADA

Power Corporation of Canada has a 10% or greater voting interest in the following entities:

Great -West Life & Annuity Insurance Company Group of Companies (U.S. insurance)

Power Corporation of Canada (Canada) – Holding and Management Company

100.0% - 2795957 Canada Inc. (Canada) – Holding Company

100.0% - 171263 Canada Inc. (Canada) – Holding Company

66.4% - Power Financial Corporation (Canada) – Holding Company

70.4% - Great -West Lifeco Inc. (Canada) – Holding Company

100.0% - Great -West Financial (Canada) Inc. (Canada) – Holding Company

100.0% - Great -West Financial (Nova Scotia) Co. (Canada) – Holding Company

100.0% - Great-West Lifeco U.S. Inc.

100.0% - GWL&A Financial Inc. (Delaware) – Holding Company

60.0% - Great -West Life & Annuity Insurance Capital (Nova Scotia) Co. (Canada) – Holding Company

60.0% - Great -West Life & Annuity Insurance Capital (Nova Scotia) Co. II (Canada) – Holding Company

60.0% - Great -West Life & Annuity Insurance Capital, LLC (Delaware) – Holding Company

60.0% - Great -West Life & Annuity Insurance Capital, LLC II (Delaware) – Holding Company

100.0% - Great -West Life & Annuity Insurance Company (Colorado) – Life and Health Insurance Company

100.0% - First Great -West Life & Annuity Insurance Company (New York) – Life and Health Insurance Company

100.0% - Advised Assets Group, LLC (Colorado) – Investment Advisor

100.0% - Alta Health & Life Insurance Company (Indiana) – Life and Health Insurance Company

100.0% - BenefitsCorp, Inc. (Delaware) – Insurance Agency

100.0% - GWFS Equities, Inc. ( Delaware) – Securities Broker/Dealer

100.0% - BenefitsCorp, Inc. of Wyoming (Wyoming) – Insurance Agency

100.0% - Benefit Management Corp. (Montana) – Holding Company

100.0% - Allegiance Benefit Plan Management, Inc. (Montana) – TPA

100.0% - Allegiance Life & Health Insurance Company, Inc. (Montana) – Life and Health Insurance Company

100.0% - Allegiance COBRA Services, Inc. (Montana) – TPA

100.0% - Allegiance Re, Inc. (Montana) – Captive Insurance Company

100.0% - Allegiance Provider Direct, LLC (Montana) – Network Contracting Services

100.0% - Intermountain Underwriters, Inc. (Montana) – Insurance Agency

100.0% - StarPoint HealthCare, LLC (Montana) – Utilization Review/Case Management

50.0% - Community Health Network, LLC (Montana) – Provider Networking

100.0% - Canada Life Insurance Company of America (Michigan) – Life and Health Insurance Company

100.0% - Great-West Life & Annuity Insurance Company of South Carolina (South Carolina) – Captive Insurance Company

100.0% - National Plan Coordinators of Delaware, Inc. (Delaware) – Third Party

100.0% - Emjay Corporation (Wisconsin) – Third Party Administrator

100.0% - EMJAY Retirement Plan Services, Inc. (Wisconsin) Third Party Administrator

100.0% - Great-West Healthcare Holdings, Inc. (Colorado) – Holding Company

100.0% - Great-West Healthcare, Inc. (Vermont) – Network Contracting, Development and Management

100.0% - Great-West Healthcare of Arizona, Inc. (Arizona) – Health Care Services Organization

100.0% - Great-West Healthcare of California, Inc. (California) – Health Maintenance Organization

100.0% - Great-West Healthcare of Colorado, Inc. (Colorado) – Health Maintenance Organization

100.0% - Great-West Healthcare of Florida, Inc. (Florida) – Health Maintenance Organization

100.0% - Great-West Healthcare of Georgia, Inc. (Georgia) – Health Maintenance Organization

100.0% - Great-West Healthcare of Illinois, Inc. (Illinois) – Health Maintenance Organization

100.0% - Great-West Healthcare of Indiana, Inc. (Indiana) – Health Maintenance Organization

100.0% - Great-West Healthcare of Kansas/Missouri, Inc. (Kansas) – Health Maintenance Organization

100.0% - Great-West Healthcare of Massachusetts, Inc. (Massachusetts) – Health Maintenance Organization

100.0% - Great-West Healthcare of New Jersey, Inc. (New Jersey) – Health Maintenance Organization

100.0% - Great-West Healthcare of North Carolina, Inc. (North Carolina) – Health Maintenance Organization

100.0% - Great-West Healthcare of Ohio, Inc. (Ohio) – Health Maintenance Organization

100.0% - Great-West Healthcare of Oregon, Inc. (Oregon) – Health Maintenance Organization

100.0% - Great-West Healthcare of Pennsylvania, Inc. (Pennsylvania) – Health Maintenance Organization

100.0% - Great-West Healthcare of Tennessee, Inc. (Tennessee) – Health Maintenance Organization

100.0% - Great-West Healthcare of Texas, Inc. (Texas) – Health Maintenance Organization

100.0% - Great-West Healthcare of Washington, Inc. (Washington) – Health Maintenance Organization

100.0% - One Orchard Equities, Inc. (Colorado) Securities Broker/Dealer

100.0% - Mediversal, Inc. (Nevada) – Third Party Administrator

100.0% - Universal Claims Administration (Nevada) – Third Party Administrator

100.0% - FASCore, LLC (Colorado) – Third Party Administrator

100.0% - GWL Properties Inc. (Colorado) – Real Estate Corporation

50.0% - Westkin Properties Ltd. (California) – Real Estate Corporation

100.0% - Great-West Benefit Services, Inc. (Delaware) – Leasing Company

88.34% - Maxim Series Fund, Inc. (Maryland) – Investment Company

100.0% - GW Capital Management, LLC (Colorado) – Investment Advisor

100.0% - Orchard Trust Company, LLC (Colorado) – Trust Company

100.0% - IHN, Inc. (Indiana) - Network Contracting, Development and Management

100.0% - Lottery Receivable Company One LLC (Delaware) – Lottery Annuity Administrator

100.0% - LR Company II, L.L.C. (Delaware) – Lottery Annuity Administrator

100.0% - Singer Collateral Trust IV (Delaware) – Lottery Annuity Administrator

100.0% - Singer Collateral Trust V (Delaware) – Lottery Annuity Administrator

Putnam Investments Group of Companies (Mutual Funds)

Power Corporation of Canada

100.0% - 2795957 Canada Inc.

100.0% - 171263 Canada Inc.

66.4% - Power Financial Corporation

70.5% - Great-West Lifeco Inc.

100.0% - Great-West Financial (Canada) Inc.

100.0% - Great-West Financial (Nova Scotia) Co.

100% - Great-West Lifeco U.S., Inc.

100% - Putnam Investments, LLC

100.0% - Putnam Acquisition Financing Inc.

100.0% - Putnam Acquisition Financing LLC

100.0% - Putnam U.S. Holdings Inc.

100.0% - Putnam Funding Inc.

100.0% - Putnam General Partnership

100.0% - Endeavor Holding LLC

100.0% -Putnam, LLC

99.0% - Putnam Retail Management Limited Partnership (1% owned by Putnam Retail Management GP, Inc.)

100.0% - Putnam Retail Management GP, Inc.

100.0% - Putnam Investment Management, LLC

100.0% - Putnam Advisory Company GP, Inc.

99.0% - Putnam Advisory Company, Limited Partnership (1% owned by Putnam Advisory Company GP, Inc.)

100.0% - The Putnam Advisory Company, LLC

100.0% - Putnam U.S. Holdings I Inc.

100.0% - Putnam U.S. Holdings II Inc

99.0% - Putnam Investment Trust II LP (1% owned by Putnam U.S. Holdings II Inc.)

100.0% - Putnam U.S. Holdings, LLC

84.0% - PanAgora Asset Management, Inc.

100.0% -Putnam GP Inc.

100.0% - PII Holdings, Inc.

99.0% - TH Lee Putnam Equity Managers LP (1% owned by Putnam GP Inc.)

100.0% - Putnam Investor Services, Inc.

100.0% - Putnam Investment Holdings, LLC

100.0% - Putnam Aviation Holdings, LLC

100.0% - Putnam Capital, LLC

80.0% - TH Lee Putnam Capital Management, LLC

100.0% - Putnam Fiduciary Trust Company

100.0% - Putnam International Holdings LLC

100.0% - Putnam Investments Inc. (Canada)

100.0% - Putnam Investments Limited (Ireland)

100.0% - Putnam Investments Australia Pty Limited

100.0% - Putnam Investments Securities Co., Ltd. (Japan)

100.0% - Putnam International Distributors, Ltd. (Cayman)

100.0% - Putnam Investments Argentina S.A.

100.0% - Putnam Investments Limited (U.K.)

100.0% - New Flag UK Holdings Limited

100.0% - New Flag Asset Management (UK)

The Great-West Life Assurance Company Group of Companies (Canadian insurance)

Power Corporation of Canada

100.0% - 2795957 Canada Inc.

100.0% - 171263 Canada Inc.

66.4% - Power Financial Corporation

70.4% - Great-West Lifeco Inc.

100.0% - 2142540 Ontario Inc.

100.0% - Great-West Lifeco Finance (Delware) LP

100.0% - Great-West Lifeco Finance (Delaware) LLC

100.0% - 2023308 Ontario Inc.

100.0% - Great-West Life & Annuity Insurance Capital, LP

40.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co.

40.0% - Great-West Life & Annuity Insurance Capital, LLC

100.0% - Great-West Life & Annuity Insurance Capital, LP II

40.0% - Great-West Life & Annuity Insurance Capital (Nova Scotia) Co. II

40.0% - Great-West Life & Annuity Insurance Capital, LLC II

100.0% - 2023310 Ontario Inc.

100.0% - 2023311 Ontario Inc.

100.0% - 6109756 Canada Inc.

100.0% - The Great-West Life Assurance Company

71.4% - GWL THL Private Equity I Inc. (28.6% owned by The Canada Life Assurance Company)

100.0% - GWL THL Private Equity II Inc.

100.0% - Great-West Investors Holdco Inc.

100.0% - Great-West Investors LLC

100.0% - Great-West Investors LP Inc.

100.0% - Great-West Investors GP Inc.

100.0% - Great-West Investors LP

100.0% - T.H. Lee Interests

100.0% - Gold Circle Insurance Company

100.0% - GWL Realty Advisors Inc.

100.0% - GWL Realty Advisors U.S., Inc.

100.0% - RA Real Estate Inc.

0.1% RMA Real Estate LP

100.0% - Vertica Resident Services Inc.

100.0% - GWL Investment Management Ltd.

100.0% - 801611 Ontario Ltd.

100.0% - 118050 Canada Inc.

100.0% - 1213763 Ontario Inc.

100.0% - 681348 Alberta Ltd.

100.0% - The Owners: Condominium Plan No 8510578

50.0% - 3352200 Canada Inc.

100.0% - 1420731 Ontario Limited

100.0% - 1455250 Ontario Limited

100.0% - CGWLL Inc.

65.0% - The Walmer Road Limited Partnership

50.0% - Laurier House Apartments Limited

100.0% - 2024071 Ontario Limited

100.0% - High Park Bayview Inc.

75.0% - High Park Bayview Limited Partnership

50.0% - KAB Properties Inc.

5.6% - MAM Holdings Inc. (94.4% owned by Mountain Asset Mangement LP)

100.0% - 647679 B.C. Ltd.

100.0% - Red Mile Acquisitions Inc.

70.0% - TGS North American Real Estate Investment Trust

100.0% - TGS Trust

70.0% - RMA Investment Company (Formerly TGS Investment Company)

100.0% - RMA Property Management Ltd. (Formerly TGS REIT Property Management Ltd.)

100.0% - RMA Property Management 2004 Ltd. (Formerly TGS REIT Property Management 2004 Ltd.)

100.0% - RMA Realty Holdings Corporation Ltd. (Formerly TGS Realty Holdings Corporation Ltd.)

100.0% - RMA (U.S.) Realty LLC (Delaware) [(special shares held by each of 1218023 Alberta Ltd. (50%) and 1214931 Alberta Ltd. (50%)]

100.0% - RMA American Realty Corp.

1% - RMA American Realty Limited Partnership [(99% owned by RMA (U.S.) Realty LLC (Delaware)]

99.0% - RMA American Realty Limited Partnership (1% owned by RMA American Realty Corp.)

30.0% - SFS Management LLC

100.0% - 1218023 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC (Delaware)

100.0% - 1214931 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC (Delaware)

70.0% - RMA Real Estate LP

100.0% - RMA Properties Ltd. (Formerly TGS REIT Properties Ltd.)

100.0% - S-8025 Holdings Ltd.

100.0% - RMA Properties (Valley Centre) Ltd. (Formerly TGS REIT Properties (Valley Centre) Ltd.

100.0% - RMA Properties (Riverside) Ltd. (Formerly TGS REIT Properties (Riverside) Ltd.

100.0% - RMA Properties (Tri-Cities) Ltd.(Formerly TGS REIT Properties (Tri-Cities) Ltd.

70.0% - KS Village (Millstream) Inc.

100.0% - London Insurance Group, Inc.

100.0% - Trivest Insurance Network Limited

100.0% - The Motion Picture Bond Company Inc.

100.0% - London Life Insurance Company

30.0% - TGS North American Real Estate Investment Trust

100.0% - TGS Trust

30.0% - RMA Investment Company (Formerly TGS Investment Company)

100.0% - RMAProperty Management 2004 Ltd. (Formerly TGS REIT Property Management 2004 Ltd.)

100.0% - RMA Realty Holdings Corporation Ltd. (Formerly TGS Realty Holdings Corporation Ltd.)

100.0% - RMA (U.S.) Realty LLC (Delaware) [(special shares held by each of 1218023 Alberta Ltd. (50%) and 1214931 Alberta Ltd. 50%)]

100.0% - RMA American Realty Corp.

1% - RMA American Realty Limited Partnership [(99% owned by RMA (U.S.) Realty LLC (Delaware)]

99.0% - RMA American Realty Limited Partnership (1% owned by RMA American Realty Corp.)

30.0% - SFS Management LLC

100.0% - 1218023 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC (Delaware)

100.0% - 1214931 Alberta Ltd.

50% - special shares in RMA (U.S.) Realty LLC (Delaware)

30.0% - RMA Real Estate LP

100.0% - RMA Properties Ltd. (Formerly TGS REIT Properties Ltd.)

100.0% - S-8025 Holdings Ltd.

100.0% - RMA Properties (Valley Centre) Ltd. (Formerly TGS REIT Properties (Valley Centre) Ltd.

100.0% - RMA Properties (Riverside) Ltd. (Formerly TGS REIT Properties (Riverside) Ltd.

100.0% - RMA Properties (Tri-Cities) Ltd. (Formerly TGS REIT Properties (Tri-Cities) Ltd.

100.0% - London Capital Management Ltd.

100.0% - 1319399 Ontario Inc.

100.0% - 3853071 Canada Limited

50.0% - Laurier House Apartments Limited

100.0% - 389288 B.C. Ltd.

100.0% - Quadrus Investment Services Ltd.

35.0% - The Walmer Road Limited Partnership

100.0% - 177545 Canada Limited

100.0% - Lonlife Financial Services Limited

88.0% - Neighborhood Dental Services Ltd.

100.0% - Toronto College Park Ltd.

25.0% - Preferred Vision Services Inc.

25.0% - High Park Bayview Limited Partnership

50.0% - KAB Properties Inc.

30.0% - KS Village (Millstream) Inc.

100.0% - London Life Financial Corporation

89.4% - London Reinsurance Group, Inc. (10.6% owned by London Life Insurance Company)

100.0% - London Life & General Reinsurance Co. Ltd.

100.0% - London Life & Casualty Reinsurance Corporation

100.0% - Trabaja Reinsurance Company Ltd.

100.0% - London Life and Casualty (Barbados) Corporation

100.0% - LRG (US), Inc.

100.0% - London Life International Reinsurance Corporation

100.0% - London Life Reinsurance Company

100.0% - HRMP, Inc.

51.0% - Health Reinsurance Management Partnership (Massachusetts)

100.0% - HRMP II, Inc. 49.0% - Health Reinsurance Management Partnership (Massachusetts)

100.0% - Canada Life Financial Corporation

100.0% - The Canada Life Assurance Company

100.0% - Canada Life Brasil LTDA

100.0% - Canada Life Capital Corporation, Inc.

100.0% - Canada Life International Holdings, Limited

100.0% - Canada Life International Services Limited

100.0% - Canada Life International, Limited

100.0% - CLI Institutional Limited

100.0% - Canada Life Irish Holding Company, Limited

100.0% - Lifescape Limited

100.0% - CLAI, Limited

100.0% - The Canada Life Assurance Company of Ireland, Limited

100.0% - Setanta Asset Management Limited

100.0% - Canada Life European Assurance, Limited

100.0% - Canada Life Group Services Limited

100.0% - Canada Life Europe Investment Limited

78.67% - Canada Life Assurance Europe Limited

100.0% - Canada Life Europe Management Services, Limited

21.33% - Canada Life Assurance Europe Limited

100.0% - Canada Life Assurance (Ireland), Limited

100.0% - F.S.D. Investments, Limited

100.0% - Canada Life Pension and Annuities (Ireland), Limited

100.0% - Canada Life International Re, Limited

100.0% - Canada Life Reinsurance International, Ltd.

100.0% - Canada Life Reinsurance, Ltd.

100.0% - The Canada Life Group (U.K.), Limited

100.0% - Canada Life Pension Managers & Trustees, Limited

100.0% - Canada Life Asset Management Limited

100.0% - Canada Life European Real Estate Limited

100.0% - Canada Life Trustee Services (U.K.), Limited

100.0% - CLFIS (U.K.), Limited

100.0% - Canada Life, Limited

100.0% - Canada Life (U.K.), Limited

100.0% - Albany Life Assurance Company, Limited

100.0% - Canada Life Management (U.K.), Limited

100.0% - Canada Life Services (U.K.), Limited

100.0% - Canada Life Fund Managers (U.K.), Limited

100.0% - Canada Life Group Services (U.K.), Limited

100.0% - Canada Life Holdings (U.K.), Limited

100.0% - Canada Life Irish Operations, Limited

100.0% - Canada Life Ireland Holdings, Ltd.

100.0% - 4073649 Canada, Inc. (1 common share owned by 587443 Ontario, Inc.)

100.0% - Canada Life Finance (U.K.), Limited

100.0% - CLH International Capital Management Hungary, LLC.

100.0% - The Canada Life Insurance Company of Canada

100.0% - CLICC GP Inc.

94.4% - MAM Holdings Inc. (5.6% owned by GWL)

100.0% - Mountain Asset Management LLC

100.0% - Quadrus Distribution Services Ltd.

100.0% - CL Capital Management (Canada), Inc.

100.0% - GRS Securities, Inc.

50.0% - Canadian Worksite Marketing Group, Inc.

100.0% - Classco Benefit Services, Ltd.

50.0 % - Canadian Worksite Marketing Group, Inc.

100.0% - 587443 Ontario, Inc.

100.0% - Canada Life Securing Corporation, Inc.

100.0% - Canada Life Mortgage Services, Ltd.

100.0% - Adason Properties, Limited

100.0% - Adason Realty, Ltd.

100.0% - Laketon Investment Management Ltd.

100.0% - Crown Life Insurance Company

D. IGM Financial Inc. Group of Companies (Canadian mutual funds)

Power Corporation of Canada

100.0% - 2795957 Canada Inc.

100.0% - 171263 Canada Inc.

66.4% - Power Financial Corporation

59.4% - IGM Financial Inc.

100.0% - Investors Group Inc.

100.0% - Investors Group Financial Services Inc.

100.0% - I.G. International Management Limited

100.0% - I.G. Investment Management (Hong Kong) Limited

100.0% - Investors Group Trust Co. Ltd.

100.0% - 391102 B.C. Ltd.

100.0% - Les Services Investors Limitée

100.0% - I.G. Insurance Services Inc.

100.0% - Investors Syndicate Limited

100.0% - Investors Group Securities Inc.

100.0% - I.G. Investment Management, Ltd.

100.0% - Investors Group Investment Management (Quebec) Ltd.

100.0% - Investors Syndicate Property Corp.

100.0% - 2587182 Manitoba Ltd.

100.0% - The Trust Company of London Life

100.0% - I.G. Investment Corp.

100.0% - I.G. (Rockies) Corp.

100.0% - Mackenzie Inc.

100.0% - Mackenzie Financial Corporation

100.0% - Mackenzie 2004 GP Inc.

100.0% - MSP 2005 GP Inc.

100.0% - MFC Fund Corporation

100.0% - M.R.S. Inc.

100.0% - M.R.S. Correspondent Corporation

100.0% - M.R.S. Securities Services Inc.

100.0% - Execuhold Investment Limited

100.0% - Winfund Software Corp.

100.0% - M.R.S. Trust Company

100.0% - Anacle I Corporation

100.0% - Anacle II Corporation

100.0% - Mackenzie M.E.F. Management Inc.

100.0% - Canterbury Common Inc.

100.0% - Mackenzie Financial Services Inc.

100.0% - Mackenzie Financial Capital Corporation

100.0% - Quadrus Corporate Class Inc.

75.5% - Investment Planning Counsel Inc.

100.0% - IPC Financial Network Inc.

100.0% - Investment Planning Counsel of Canada Limited

100.0% - IPC Portfolio Management Ltd.

100.0% - IPC Investment Corporation

100.0% - 579641 BC Ltd.

100.0% - 9132-2155 Quebec Inc.

100.0% - Counsel Group of Funds Inc.

100.0% - IPC Save Inc.

100.0% - 576928 BC Ltd.

100.0% - 1275279 Ontario Inc.

50.0% - IPC Estate Services Inc.

100.0% - IPC Securities Corporation

Pargesa Holding S.A. Group of Companies (European investments)

Power Corporation of Canada

100.0% - 2795957 Canada Inc.

100.0% - 171263 Canada Inc.

66.4% - Power Financial Corporation

100.0% - 3411893 Canada Inc.

100.0% - Power Financial Europe B.V.

50.0% - Parjointco N.V.

61.4% - Pargesa Holding S.A.

100.0% - Pargesa Netherlands B.V.

42.5% - Imerys

50.0% - Groupe Bruxelles Lambert

20.7% - Imerys

6.9% - Total

11.5% - Suez

51.2% - Belgian Securities BV

100.0% - Brussels Securities

48.8% - Belgian Securities BV

100.0% - GBL Participations

98.8% - Sagerpar

50.0% - GBL Coordination Center

100.0% - GBL Finance SA Holding

100.0% - GBL Overseas Finance NV

100.0% - Immobilière Rue de Namur Sàrl

100.0% - GBL Verwaltung Sàrl

25.0% - Bertelsmann AG

100.0% - GBL Verwaltung GmbH

100.0% - Finance et Participation en liquidation (Finpar)

100.0% - Orior Holding S.A.

100.0% - Fivaz & Cie SA

100.0% - Ormond GmbH

95.9% - Orior Food SA

100.0% - Pargesa Luxembourg S.A.

100.0% - SFPG

100.0% - SIB Huston

Gesca Ltée Group of Companies (Canadian communications)

Power Corporation of Canada

100.0% - Gesca Ltée

100.0% - 3846521 Canada Inc.

100.0% - 3846539 Canada Inc.

100.0% - Les Journaux Trans-Canada (1996) Inc.

100.0% - La Presse, Ltée

100.0% - Probec 5 Ltée

20.0% - 3859282 Canada Inc.

100.0% - Les Éditions Gesca Ltée

100% - Les Productions La Presse Télé Ltée

100.0% - La Presse Télé Ltée

100.0% - La Presse Télé II Ltée

100.0% - La Presse Télé III Ltée

100.0% - Septembre Editeur, S.E.N.C.

100.0% - 3819787 Canada Inc.

100.0% - 3970965 Canada Inc.

100.0% - 3834310 Canada Inc.

100.0% - 3911322 Canada Inc.

20.0% - Workopolis Canada

100.0% - 3855082 Canada Inc.

100.0% - Cyberpresse Inc.

Power Corporation (International) Limited Group of Companies ( Asian investments)

Power Corporation of Canada

100.0% - Power Corporation (International) Limited

100.0% - Power Pacific Corporation Limited

25.0% - Barrick Power Gold Corporation of China Limited

50.0% - Bombardier Power (Mauritius) Limited

50.0% - Bombardier Sifang Power (Qingdao) Transportation Ltd.

50.0% - Bombardier CPC Propulsion System Co. Ltd

100.0% - Bombardier Railway Transportation Equipment (Shanghai)

50.0% - Chang Chun Bombardier Railway Vehicle Co. Ltd

100.0% - Power Pacific Mauritius Limited

100.0% - Power Pacific Equities Limited

10.4% - Chengwei Ventures Fund I, LP

Other Companies

Power Corporation of Canada

100.0% - 152245 Canada Inc.

100.0% - Gelprim Inc.

100.0% - 3121011 Canada Inc.

100.0% - Power Technology Investment Corporation

100.0% - Power Tek, LLC

50.0% - Picchio Pharma Inc.

100.0% - Picchio Holdings Inc.

23.3% - Virochem Pharma Inc.

100.0% - P.P. Luxco Holdings Sàrl

49.9% - Sunset Holdings S.A.

21.6% - Adaltis Inc.

100.0% - P.P. Luxco Holdings II Sàrl

26.4% - Neurochem Inc.

11.9% - 4166591 Canada Inc.

36.5% - Innodia Inc.

11.9% - 4166591 Canada Inc.

100.0% - Picchio Pharma (Asia) Ltd.

1.7% - Adaltis Inc.

100.0% - Picchio Pharma Advisory Inc.

100.0% - Power Communications Inc.

100.0% - Jolliet Energy Resources Inc.

100.0% - 3540529 Canada Inc.

100.0% - Brazeau River Resources Investment Inc..

100.0% - PCC Industrial (1993) Corporation

100.0% - Power Corporation International

100.0% - 3249531 Canada Inc.

100.0% - Power Corporation of Canada Inc.

100.0% - PL S.A.

100.0% - 4190297 Canada Inc.

100.0% - Sodesm International Limited

100.0% - Sodesm Properties Limited

100.0% - Marquette Communications (1997) Corporation

100.0% - Sagard S.A.S.

C-5

Item 27.

Number of Contract Owners

As of March 31, 2008 there were 5,288 Contract owners; 5,288 were in non-qualified accounts.

Item 28.

.Indemnification

Provisions exist under the Colorado Business Corporation Act and the Bylaws of GWL&A whereby GWL&A may indemnify a director, officer, or controlling person of GWL&A against liabilities arising under the Securities Act of 1933. The following excerpts contain the substance of these provisions:

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Colorado Business Corporation Act

Article 109 - INDEMNIFICATION

Section 7-109-101. Definitions.

As used in this Article:

(1)

"Corporation" includes any domestic or foreign entity that is a predecessor of the corporation by reason of a merger, consolidation, or other transaction in which the predecessor's existence ceased upon consummation of the transaction.

(2) "Director" means an individual who is or was a director of a corporation or an individual who, while a director of a corporation, is or was serving at the corporation's request as a director, an officer, an agent, an associate, an employee, a fiduciary, a manager, a member, a partner, a promoter, or a trustee of, or to hold any similar position with, another domestic or foreign entity or of an employee benefit plan. A director is considered to be serving an employee benefit plan at the corporation's request if the director's duties to the corporation also impose duties on, or otherwise involve services by, the director to the plan or to participants in or beneficiaries of the plan. "Director" includes, unless the context requires otherwise, the estate or personal representative of a director.

(3)

"Expenses" includes counsel fees.

(4)

"Liability" means the obligation incurred with respect to a proceeding to pay a judgment, settlement, penalty, fine, including an excise tax assessed with respect to an employee benefit plan, or reasonable expenses.

(5)

"Official capacity" means, when used with respect to a director, the office of director in the corporation and, when used with respect to a person other than a director as contemplated in Section 7-109-107, the office in a corporation held by the officer or the employment, fiduciary, or agency relationship undertaken by the employee, fiduciary, or agent on behalf of the corporation. "Official capacity" does not include service for any other domestic or foreign corporation or other person or employee benefit plan.

(6)

"Party" includes a person who was, is, or is threatened to be made a named defendant or respondent in a proceeding.

(7)

"Proceeding" means any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal.

Section 7-109-102. Authority to indemnify directors.

(1)

Except as provided in subsection (4) of this section, a corporation may indemnify a person made a party to the proceeding because the person is or was a director against liability incurred in the proceeding if:

(a)

The person conducted himself or herself in good faith; and

(b)

The person reasonably believed:

(I)

In the case of conduct in an official capacity with the corporation, that his or her conduct was in the corporation's best interests; and

(II)

In all other cases, that his or her conduct was at least not opposed to the corporation's best interests; and

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(c)

In the case of any criminal proceeding, the person had no reasonable cause to believe his or her conduct was unlawful.

(2)

A director's conduct with respect to an employee benefit plan for a purpose the director reasonably believed to be in the interests of the participants in or beneficiaries of the plan is conduct that satisfies the requirements of subparagraph (II) of paragraph (b) of subsection (1) of this section. A director's conduct with respect to an employee benefit plan for a purpose that the director did not reasonably believe to be in the interests of the participants in or beneficiaries of the plan shall be deemed not to satisfy the requirements of subparagraph (a) of subsection (1) of this section.

(3)

The termination of any proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, is not, of itself, determinative that the director did not meet the standard of conduct described in this section.

(4)

A corporation may not indemnify a director under this section:

(a)

In connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation; or

(b)

In connection with any proceeding charging that the director derived an improper personal benefit, whether or not involving action in an official capacity, in which proceeding the director was adjudged liable on the basis that he or she derived an improper personal benefit.

(5)

Indemnification permitted under this section in connection with a proceeding by or in the right of a corporation is limited to reasonable expenses incurred in connection with the proceeding.

Section 7-109-103. Mandatory Indemnification of Directors.

Unless limited by the articles of incorporation, a corporation shall indemnify a person who was wholly successful, on the merits or otherwise, in defense of any proceeding to which the person was a party because the person is or was a director, against reasonable expenses incurred by him or her in connection with the proceeding.

Section 7-109-104. Advance of Expenses to Directors.

(1)

A corporation may pay for or reimburse the reasonable expenses incurred by a director who is a party to a proceeding in advance of the final disposition of the proceeding if:

(a)

The director furnishes the corporation a written affirmation of the director’s good-faith belief that he or she has met the standard of conduct described in Section 7-109-102;

(b)

The director furnishes the corporation a written undertaking, executed personally or on the director's behalf, to repay the advance if it is ultimately determined that he or she did not meet such standard of conduct; and

(c)

A determination is made that the facts then known to those making the determination would not preclude indemnification under this article.

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(2)

The undertaking required by paragraph (b) of subsection (1) of this section shall be an unlimited general obligation of the director, but need not be secured and may be accepted without reference to financial ability to make repayment.

(3)

Determinations and authorizations of payments under this section shall be made in the manner specified in Section 7-109-106.

Section 7-109-105. Court-Ordered Indemnification of Directors.

(1)

Unless otherwise provided in the articles of incorporation, a director who is or was a party to a proceeding may apply for indemnification to the court conducting the proceeding or to another court of competent jurisdiction. On receipt of an application, the court, after giving any notice the court considers necessary, may order indemnification in the following manner:

(a)

If it determines the director is entitled to mandatory indemnification under section 7-109-103, the court shall order indemnification, in which case the court shall also order the corporation to pay the director's reasonable expenses incurred to obtain court-ordered indemnification.

(b)

If it determines that the director is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the director met the standard of conduct set forth in section 7-109-102 (1) or was adjudged liable in the circumstances described in Section 7-109-102 (4), the court may order such indemnification as the court deems proper; except that the indemnification with respect to any proceeding in which liability shall have been adjudged in the circumstances described Section 7-109-102 (4) is limited to reasonable expenses incurred in connection with the proceeding and reasonable expenses incurred to obtain court-ordered indemnification.

Section 7-109-106. Determination and Authorization of Indemnification of Directors.

(1)

A corporation may not indemnify a director under Section 7-109-102 unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because he has met the standard of conduct set forth in Section 7-109-102. A corporation shall not advance expenses to a director under Section 7-109-104 unless authorized in the specific case after the written affirmation and undertaking required by Section 7-109-104(1)(a) and (1)(b) are received and the determination required by Section 7-109-104(1)(c) has been made.

(2)

The determinations required by under subsection (1) of this section shall be made:

(a)

By the board of directors by a majority vote of those present at a meeting at which a quorum is present, and only those directors not parties to the proceeding shall be counted in satisfying the quorum.

(b)

If a quorum cannot be obtained, by a majority vote of a committee of the board of directors designated by the board of directors, which committee shall consist of two or more directors not parties to the proceeding; except that directors who are parties to the proceeding may participate in the designation of directors for the committee.

(3)

If a quorum cannot be obtained as contemplated in paragraph (a) of subsection (2) of this section, and the committee cannot be established under paragraph (b) of subsection (2) of this section, or even if a quorum is obtained or a committee designated, if a majority of the

directors constituting such quorum or such committee so directs, the determination required to be made by subsection (1) of this section shall be made:

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(a)

By independent legal counsel selected by a vote of the board of directors or the committee in the manner specified in paragraph (a) or (b) of subsection (2) of this section or, if a quorum of the full board cannot be obtained and a committee cannot be established, by independent legal counsel selected by a majority vote of the full board of directors; or

(b)

By the shareholders.

(4)

Authorization of indemnification and advance of expenses shall be made in the same manner as the determination that indemnification or advance of expenses is permissible; except that, if the determination that indemnification or advance of expenses is permissible is made by independent legal counsel, authorization of indemnification and advance of expenses shall be made by the body that selected such counsel.

Section 7-109-107. Indemnification of Officers, Employees, Fiduciaries, and Agents.

(1)

Unless otherwise provided in the articles of incorporation:

(a)

An officer is entitled to mandatory indemnification under section 7-109-103, and is entitled to apply for court-ordered indemnification under section 7-109-105, in each case to the same extent as a director;

(b)

A corporation may indemnify and advance expenses to an officer, employee, fiduciary, or agent of the corporation to the same extent as a director; and

(c)

A corporation may indemnify and advance expenses to an officer, employee, fiduciary, or agent who is not a director to a greater extent, if not inconsistent with public policy, and if provided for by its bylaws, general or specific action of its board of directors or shareholders, or contract.

Section 7-109-108. Insurance.

A corporation may purchase and maintain insurance on behalf of a person who is or was a director, officer, employee, fiduciary, or agent of the corporation, or who, while a director, officer, employee, fiduciary, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, fiduciary, or agent of another domestic or foreign entity or of an employee benefit plan, against liability asserted against or incurred by the person in that capacity or arising from his or her status as a director, officer, employee, fiduciary, or agent, whether or not the corporation would have power to indemnify the person against the same liability under section 7-109-102, 7-109-103, or 7-109-107. Any such insurance may be procured from any insurance company designated by the board of directors, whether such insurance company is formed under the law of this state or any other jurisdiction of the United States or elsewhere, including any insurance company in which the corporation has an equity or any other interest through stock ownership or otherwise.

Section 7-109-109. Limitation of Indemnification of Directors.

(1)

A provision concerning a corporation's indemnification of, or advance of expenses to, directors that is contained in its articles of incorporation or bylaws, in a resolution of its shareholders or board of directors, or in a contract, except for an insurance policy or otherwise, is valid only to the extent the provision is not inconsistent with Sections 7-109-101 to 7-109- 108. If the articles of incorporation limit indemnification or advance of expenses, indemnification or advance of expenses are valid only to the extent not inconsistent with the articles of incorporation.

108. If the articles of incorporation limit indemnification or advance of expenses, indemnification or advance of expenses are valid only to the extent not inconsistent with the articles of incorporation.

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(2)

Sections 7-109-101 to 7-109-108 do not limit a corporation's power to pay or reimburse expenses incurred by a director in connection with an appearance as a witness in a proceeding at a time when he or she has not been made a named defendant or respondent in the proceeding.

Section 7-109-110. Notice to Shareholders of Indemnification of Director.

If a corporation indemnifies or advances expenses to a director under this article in connection with a proceeding by or in the right of the corporation, the corporation shall give written notice of the indemnification or advance to the shareholders with or before the notice of the next shareholders' meeting. If the next shareholder action is taken without a meeting at the instigation of the board of directors, such notice shall be given to the shareholders at or before the time the first shareholder signs a writing consenting to such action.

Bylaws of Great-West

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Article IV. Indemnification

SECTION 1. In this Article, the following terms shall have the following meanings:

(a)

“expenses” means reasonable expenses incurred in a proceeding, including expenses of investigation and preparation, expenses in connection with an appearance as a witness, and fees and disbursement of counsel, accountants or other experts;

(b)

“liability” means an obligation incurred with respect to a proceeding to pay a judgment, settlement, penalty or fine;

(c)

“party” includes a person who was, is, or is threatened to be made a named defendant or respondent in a proceeding;

(d)

“proceeding” means any threatened, pending or completed action, suit, or proceeding whether civil, criminal, administrative or investigative, and whether formal or informal.

SECTION 2. Subject to applicable law, if any person who is or was a director, officer or employee of the corporation is made a party to a proceeding because the person is or was a director, officer or employee of the corporation, the corporation shall indemnify the person, or the estate or personal representative of the person, from and against all liability and expenses incurred by the person in the proceeding (and advance to the person expenses incurred in the proceeding) if, with respect to the matter(s) giving rise to the proceeding:

(a)

the person conducted himself or herself in good faith; and

(b)

the person reasonably believed that his or her conduct was in the corporation’s best interests; and

(c)

in the case of any criminal proceeding, the person had no reasonable cause to believe that his or her conduct was unlawful; and

(d)

if the person is or was an employee of the corporation, the person acted in the ordinary course of the person’s employment with the corporation.

SECTION 3. Subject to applicable law, if any person who is or was serving as a director, officer, trustee or employee of another company or entity at the request of the corporation is made a party to a proceeding because the person is or was serving as a director, officer, trustee or employee of the other company or entity, the corporation shall indemnify the person, or the estate or personal representative of the person, from and against all liability and expenses incurred by the person in the proceeding (and advance to the person expenses incurred in the proceeding) if:

(a)

the person is or was appointed to serve at the request of the corporation as a director, officer, trustee or employee of the other company or entity in accordance with Indemnification Procedures approved by the Board of Directors of the corporation; and

(b)

with respect to the matter(s) giving rise to the proceeding:

C-14

(i)

the person conducted himself or herself in good faith; and

(ii)

the person reasonably believed that his or her conduct was at least not opposed to the corporation’s best interests (in the case of a trustee of one of the corporation’s staff benefits plans, this means that the person’s conduct was for a purpose the person reasonably believed to be in the interests of the plan participants); and

(iii)

in the case of any criminal proceeding, the person had no reasonable cause to believe that his or her conduct was unlawful; and

if the person is or was an employee of the other company or entity, the person acted in the ordinary course of the person’s employment with the other company or entity.

Item 29.

Principal Underwriter

(a) GWFS Equities, Inc. ("GWFS") is the distributor of securities of the Registrant. GWFS serves as distributor or principal underwriter for Maxim Series Fund, Inc., an open-end management investment company, and the First Great-West Life & Annuity Insurance Company Variable Annuity-1 Series Account, Maxim Series Account, FutureFunds Series Account and COLI VUL-2 Series Account and COLI VUL - 4 Series Account in addition to those of the Registrant.

(b)

Directors and Officers of GWFS:

Name	Principal Business Address	Position and Officers with Underwriter
C. P. Nelson	8515 East Orchard Road Greenwood Village, CO 80111	Chairman, President and Chief Executive Officer
R. K. Shaw	8515 East Orchard Road Greenwood Village, CO 80111	Director
G. E. Seller	18101 Von Karman Ave. Suite 1460 Irvine, CA 92715	Director and Senior Vice President
G. R. McDonald	8515 East Orchard Road Greenwood Village, CO 80111	Director
M. R. Edwards	8515 East Orchard Road Greenwood Village, CO 80111	Senior Vice President
W. S. Harmon	8515 East Orchard Road Greenwood Village, CO 80111	Vice President
J. C. Luttges	8515 East Orchard Road Greenwood Village, CO 80111	Vice President
R. Meyer	8515 East Orchard Road Greenwood Village, CO 80111	Vice President, Taxation
K. A. Morris	500 North Central Suite 220 Glendale, CA 91203	Vice President
G. R. Derback	8515 East Orchard Road Greenwood Village, CO 80111	Treasurer
B. A. Byrne	8525 East Orchard Road Greenwood Village, CO 80111	Secretary and Chief Compliance Officer

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D. K. Cohen

8515 East Orchard Road

Greenwood Village, CO 80111

Assistant Vice President, Taxation

T. L. Luiz

8515 East Orchard Road

Greenwood Village, CO 80111

Compliance Officer

M. C. Maiers

8515 East Orchard Road

Greenwood Village, CO 80111

Investments Compliance Officer

	Net
Name of	Underwriting	Compensation
Principal	Discounts and	on	Brokerage
Underwriter	Commissions	Redemption	Commissions	Compensation
Schwab	-0-	-0-	-0-	-0-
GWFS	-0-	-0-	-0-	-0-

Item 30.

Location of Accounts and Records

All accounts, books, or other documents required to be maintained by Section 31(a) of the 1940 Act and the rules promulgated thereunder are maintained by the Registrant through GWL&A, 8515 E. Orchard Road, Greenwood Village, Colorado 80111.

Item 31.

Management Services

Not Applicable.

Item 32.

Undertakings and Representations

(a)

Registrant undertakes to file a post-effective amendment to this Registration Statement as frequently as is necessary to ensure that the audited financial statements in the Registration Statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted.

(b)

Registrant undertakes to include either (1) as part of any application to purchase a contract offered by the Prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a postcard or similar written communication affixed to or included in the Prospectus that the applicant can remove to send for a Statement of Additional Information.

(c)

Registrant undertakes to deliver any Statement of Additional Information and any financial statements required to be made available under this form promptly upon written or oral request.

(d)

GWL&A represents the fees and charges deducted under the Contracts, in the aggregate, are reasonable in relation to the services rendered, the expenses to be incurred and the risks assumed by GWL&A.

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SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets the requirements of Securities Act Rule 485(b) for effectiveness of this Post-Effective Amendment No. 19 to the Registration Statement and has duly caused this Post-Effective Amendment No. 19 to the Registration Statement on Form N-4 to be signed on its behalf, in the City of Greenwood Village, State of Colorado, on this 24^th day of April 2008.

		VARIABLE ANNUITY-1 SERIES ACCOUNT
				(Registrant)


		BY:	/s/ R. L. McFeetors
			R. L. McFeetors, President and Chief Executive Officer of
			Great-West Life & Annuity Insurance Company

	BY:		GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
			(Depositor)



		BY:	/s/ R. L. McFeetors
			R. L. McFeetors
			President and Chief Executive Officer


As required by the Securities Act of 1933, this Post-Effective Amendment No. 19 to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:

Signature			Title		Date


/s/ R. Gratton
R. Gratton*			Chairman of the Board		April 24, 2008


/s/ W. T. McCallum
W. T. McCallum			Vice-Chairman of the Board		April 24, 2008


/s/ R. L. McFeetors
R. L. McFeetors			Director, President and		April 24, 2008
			Chief Executive Officer

/s/ M. T. G. Graye
M. T. G. Graye			Executive Vice President and		April 24, 2008
			Chief Financial Officer

/s/ J. Balog					April 24, 2008
J. Balog*			Director


Signature	Title	Date


/s/ J. L. Bernbach
J. L. Bernbach*	Director	April 24, 2008


/s/ O. T. Dackow
O. T. Dackow*	Director	April 24, 2008


/s/ A. Desmarais
A. Desmarais*	Director	April 24, 2008


/s/ P. Desmarais
P. Desmarais, Jr.*	Director	April 24, 2008


/s/ K. P. Kavanagh
K. P. Kavanagh*	Director	April 24, 2008


/s/ A. Louvel
A. Louvel*	Director	April 24, 2008


/s/ W. Mackness
W. Mackness*	Director	April 24, 2008


/s/ J. E. A. Nickerson
J. E. A. Nickerson*	Director	April 24, 2008


/s/ D. A. Nield
D. A. Nield*	Director	April 24, 2008


/s/ R.J. Orr
R. J. Orr*	Director	April 24, 2008


/s/ M. Plessis-Bélair
M. Plessis-Bélair*	Director	April 24, 2008


/s/ P. K. Ryan
P. K. Ryan*	Director	April 24, 2008


/s/ B. E. Walsh
B. E. Walsh*	Director	April 24, 2008

*By:	/s/ R. G. Schultz
	R. G. Schultz	April 24, 2008
Attorney-in-Fact pursuant to Powers of Attorney for Messrs. Orr, Mackness, and Ryan are filed herewith Attorney-in-Fact pursuant to Powers of Attorney incorporated by reference to the Registrant's Post-Effective Amendment No. 18 to the Registration Statement, filed on April 26, 2007 (File No. 333-52956).

Year Ended
December 31, 2007

Weighted average fair value of options granted

Intrinsic value of options exercised ¹

Fair value of options vested