2006        

Nationwide^® Variable Account-10

December 31, 2006

Annual Report    

Nationwide Life Insurance Company

Home Office: Columbus, Ohio

APO– 4740 –12/06

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY

December 31, 2006

Assets:
Investments at fair value:
American Century Variable Portfolios, Inc. – Income & Growth Fund – Class I (ACVPIncGr) 7,941 shares (cost $55,124)	$	68,527
American Century Variable Portfolios, Inc. – International Fund – Class I (ACVPInt) 7,476 shares (cost $55,241)		75,655
American Century Variable Portfolios, Inc. – Value Fund – Class I (ACVPVal) 10,516 shares (cost $81,461)		91,908
Credit Suisse Trust – Large Cap Value Portfolio (CSTLCapV) 302 shares (cost $3,721)		5,131
Dreyfus Investment Portfolios – Small Cap Stock Index Portfolio – Service Shares (DryIPSmCap) 220 shares (cost $4,090)		4,086
Dreyfus Socially Responsible Growth Fund, Inc. – Initial Shares, The (DrySRGro) 2,729 shares (cost $89,819)		77,631
Dreyfus Stock Index Fund, Inc. – Initial Shares (DryStkIx) 8,317 shares (cost $253,549)		300,642
Dreyfus Variable Investment Fund – Appreciation Portfolio – Initial Shares (DryVIApp) 354 shares (cost $12,385)		15,070
Federated Insurance Series – Federated Quality Bond Fund II – Primary Shares (FedQualBd) 4,302 shares (cost $48,632)		48,570
Fidelity® Variable Insurance Products Fund – Equity-Income Portfolio – Service Class (FidVIPEIS) 4,992 shares (cost $116,904)		130,337
Fidelity® Variable Insurance Products Fund – Growth Portfolio – Service Class (FidVIPGrS) 4,165 shares (cost $152,804)		148,759
Fidelity® Variable Insurance Products Fund – High Income Portfolio – Service Class (FidVIPHIS) 2,418 shares (cost $16,115)		15,279
Fidelity® Variable Insurance Products Fund – Overseas Portfolio – Service Class (FidVIPOvS) 2,656 shares (cost $47,774)		63,368
Fidelity® Variable Insurance Products Fund II – Contrafund® Portfolio – Service Class (FidVIPConS) 4,939 shares (cost $125,072)		155,000
Fidelity® Variable Insurance Products Fund III – Growth Opportunities Portfolio – Service Class (FidVIPGrOpS) 1,000 shares (cost $17,401)		18,149
Fidelity® Variable Insurance Products Fund III – Value Strategies Portfolio – Service Class (FidVIPVaIS) 691 shares (cost $9,054)		9,275
Gartmore GVIT – Emerging Markets Fund – Class I (GVITEmMrkts) 3,303 shares (cost $36,688)		57,864
Gartmore GVIT – Federated GGVIT High Income Bond Fund – Class I (GVITFHiInc) 3,894 shares (cost $30,333)		31,076
Gartmore GVIT – Global Health Sciences Fund – Class I (GVITGlHlth) 258 shares (cost $2,729)		2,737
Gartmore GVIT – Global Technology and Communications Fund – Class I (GVITGlTech) 713 shares (cost $2,717)		3,052

(Continued)

2

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY, Continued

Gartmore GVIT – Global Utilities Fund – Class I (GVITGlUtl1) 487 shares (cost $5,421)	$	6,243
Gartmore GVIT – Government Bond Fund – Class I (GVITGvtBd) 8,494 shares (cost $100,453)		96,402
Gartmore GVIT – Growth Fund: Class I (GVITGrowth) 3,684 shares (cost $48,178)		44,762
Gartmore GVIT – International Growth Fund – Class I (GVITIntGro) 3,416 shares (cost $32,963)		41,229
Gartmore GVIT – J.P. Morgan GVIT Balanced Fund: Class I (GVITJPBal) 5,571 shares (cost $52,701)		61,281
Gartmore GVIT – Mid Cap Growth Fund – Class I (GVITMdCpGr) 621 shares (cost $16,974)		18,529
Gartmore GVIT – Mid Cap Index Fund – Class I (GVITMdCpIdx) 5,120 shares (cost $73,714)		95,189
Gartmore GVIT – Money Market Fund – Class I (GVITMyMkt) 88,360 shares (cost $88,360)		88,360
Gartmore GVIT – Nationwide® Fund – Class I (GVITNWFund) 8,280 shares (cost $85,701)		110,291
Gartmore GVIT – Small Cap Growth Fund – Class I (GVITSmCapGr) 1,043 shares (cost $14,913)		17,108
Gartmore GVIT – Small Cap Value Fund – Class I (GVITSmCapVal) 14,172 shares (cost $142,538)		176,446
Gartmore GVIT – Small Company Fund – Class I (GVITSmComp) 4,763 shares (cost $103,470)		119,032
Gartmore GVIT – U.S. Growth Leaders Fund – Class I (GVITUSGro) 1,396 shares (cost $14,706)		14,719
Gartmore GVIT – Van Kampen GVIT Comstock Value Fund – Class I (GVITVKVal) 4,297 shares (cost $48,635)		53,882
Gartmore GVIT – Van Kampen GVIT Multi-Sector Bond Fund – Class I (GVITMltSec) 8,946 shares (cost $88,500)		87,761
Gartmore GVIT – Worldwide Leaders Fund – Class I (GVITWLead) 2,798 shares (cost $33,622)		44,494
Janus Aspen Series – Forty Portfolio – Service Shares (JanForty) 6,670 shares (cost $167,398)		199,511
Janus Aspen Series – Global Technology Portfolio – Service Shares (JanGlTech) 8,531 shares (cost $37,295)		36,428
Janus Aspen Series – International Growth Portfolio – Service Shares (JanIntGro) 3,042 shares (cost $85,488)		153,959
Neuberger Berman Advisers Management Trust – Guardian Portfolio – I Class Shares (NBAMTGuard) 475 shares (cost $6,851)		9,368
Neuberger Berman Advisers Management Trust – Mid Cap Growth Portfolio – I Class Shares (NBAMTMCGr) 2,402 shares (cost $41,643)		55,879
Neuberger Berman Advisers Management Trust – Partners Portfolio® – Class I (NBAMTPart) 1,573 shares (cost $31,072)		33,283

(Continued)

3

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENT OF ASSETS, LIABILITIES AND CONTRACT OWNERS’ EQUITY, Continued

Oppenheimer Variable Account Funds – Capital Appreciation Fund/VA – Non-Service Shares (OppCapAp) 3,435 shares (cost $136,529)	$	142,303
Oppenheimer Variable Account Funds – Global Securities Fund/VA – Non-Service Shares (OppGlSec) 3,080 shares (cost $81,632)		113,318
Oppenheimer Variable Account Funds – Main Street Fund®/VA – Initial Class (OppMSt) 9,306 shares (cost $192,909)		230,604
Oppenheimer Variable Account Funds – Oppenheimer Mid Cap Fund/VA – Non-Service Shares (OppMidCap) 1,301 shares (cost $62,635)		66,152
Van Eck Worldwide Insurance Trust – Worldwide Emerging Markets Fund – Initial Class (VEWrldEMkt) 327 shares (cost $5,232)		8,170
Van Eck Worldwide Insurance Trust – Worldwide Hard Assets Fund – Initial Class (VEWrldHAs) 1,047 shares (cost $24,137)		34,261
Van Kampen – The Universal Institutional Funds, Inc. – Mid Cap Growth Portfolio – Class I (VKMidCapG) 269 shares (cost $2,481)		3,352
Van Kampen – The Universal Institutional Funds, Inc. – U.S. Real Estate Portfolio – Class I (VKUSRealEst) 3,315 shares (cost $60,702)		97,318
Wells Fargo Advantage Variable Trust FundsSM – Wells Fargo Advantage VT Opportunity Fund (WFAVTOpp) 4,044 shares (cost $82,236)		97,141
Total Investments		3,678,891
Accounts Receivable		780
Total Assets		3,679,671
Accounts Payable		–
Contract Owners Equity (note 5)	$	3,679,671

See accompanying notes to financial statements.

4

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF OPERATIONS

Year Ended December 31, 2006

Investment activity:	Total			ACVPIncGr		ACVPInt		ACVPVal		CSTLCapV		DryIPSmCap		DrySRGro		DryStkIx
Reinvested dividends	$	45,683		1,115		1,093		1,452		50		28		77		4,647
Mortality and expense risk charges (note 2)		(48,519	)	(869	)	(962	)	(1,384	)	(71	)	(143	)	(1,024	)	(3,883	)
Net investment income (loss)		(2,836	)	246		131		68		(21	)	(115	)	(947	)	764
Proceeds from mutual fund shares sold		438,439		1,111		3,239		27,449		699		13,265		1,032		5,290
Cost of mutual fund shares sold		(374,899	)	(1,050	)	(3,506	)	(24,190	)	(526	)	(13,187	)	(1,593	)	(5,501	)
Realized gain (loss) on investments		63,540		61		(267	)	3,259		173		78		(561	)	(211	)
Change in unrealized gain (loss) on investments		283,264		8,877		14,613		3,020		699		(118	)	7,050		36,196
Net gain (loss) on investments		346,804		8,938		14,346		6,279		872		(40	)	6,489		35,985
Reinvested capital gains		85,132		–		–		9,159		–		156		–		–
Net increase (decrease) in contract owners’ equity resulting from operations	$	429,100		9,184		14,477		15,506		851		1		5,542		36,749
Investment activity:	DryVIApp			FedQualBd		FidVIPEIS		FidVIPGrS		FidVIPHIS		FidVIPOvS		FidVIPConS		FidVIPGrOpS
Reinvested dividends	$	211		1,957		3,376		398		1,126		442		1,731		103
Mortality and expense risk charges (note 2)		(193	)	(667	)	(1,398	)	(2,015	)	(107	)	(786	)	(2,144	)	(239	)
Net investment income (loss)		18		1,290		1,978		(1,617	)	1,019		(344	)	(413	)	(136	)
Proceeds from mutual fund shares sold		444		1,553		4,664		3,209		1,132		5,512		23,516		241
Cost of mutual fund shares sold		(456	)	(1,600	)	(4,245	)	(4,066	)	(1,102	)	(3,911	)	(17,388	)	(251	)
Realized gain (loss) on investments		(12	)	(47	)	419		(857	)	30		1,601		6,128		(10	)
Change in unrealized gain (loss) on investments		1,940		30		1,787		9,946		(305	)	6,928		(3,664	)	818
Net gain (loss) on investments		1,928		(17	)	2,206		9,089		(275	)	8,529		2,464		808
Reinvested capital gains		–		–		13,306		–		–		344		12,506		–
Net increase (decrease) in contract owners’ equity resulting from operations	$	1,946		1,273		17,490		7,472		744		8,529		14,557		672

(Continued)

5

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF OPERATIONS, Continued

Year Ended December 31, 2006

Investment activity:	FidVIPVaIS			GVITEmMrkts		GVITFHiInc		GVITGlHlth		GVITGlTech		GVITGlUtl1		GVITGvtBd		GVITGrowth
Reinvested dividends	$	35		343		2,252		–		–		145		3,719		23
Mortality and expense risk charges (note 2)		(106	)	(686	)	(430	)	(54	)	(39	)	(94	)	(1,226	)	(529	)
Net investment income (loss)		(71	)	(343	)	1,822		(54	)	(39	)	51		2,493		(506	)
Proceeds from mutual fund shares sold		105		5,433		2,641		3,810		39		3,316		2,666		1,994
Cost of mutual fund shares sold		(115	)	(3,151	)	(2,523	)	(3,690	)	(38	)	(3,537	)	(2,810	)	(2,647	)
Realized gain (loss) on investments		(10	)	2,282		118		120		1		(221	)	(144	)	(653	)
Change in unrealized gain (loss) on investments		56		11,836		729		(25	)	306		1,640		(1,356	)	3,426
Net gain (loss) on investments		46		14,118		847		95		307		1,419		(1,500	)	2,773
Reinvested capital gains		1,162		557		–		–		–		349		670		–
Net increase (decrease) in contract owners’ equity resulting from operations	$	1,137		14,332		2,669		41		268		1,819		1,663		2,267
Investment activity:	GVITIntGro			GVITJPBal		GVITMdCpGr		GVITMdCpIdx		GVITMyMkt		GVITNWFund		GVITSmCapGr		GVITSmCapVal
Reinvested dividends	$	395		1,367		–		1,046		4,307		1,117		–		747
Mortality and expense risk charges (note 2)		(505	)	(826	)	(265	)	(1,277	)	(1,361	)	(1,430	)	(235	)	(2,300	)
Net investment income (loss)		(110	)	541		(265	)	(231	)	2,946		(313	)	(235	)	(1,553	)
Proceeds from mutual fund shares sold		9,222		8,510		4,217		1,309		73,109		1,437		332		3,022
Cost of mutual fund shares sold		(7,043	)	(8,158	)	(4,308	)	(806	)	(73,109	)	(1,362	)	(319	)	(1,628	)
Realized gain (loss) on investments		2,179		352		(91	)	503		–		75		13		1,394
Change in unrealized gain (loss) on investments		7,053		5,136		2,087		5,819		–		12,101		527		10,814
Net gain (loss) on investments		9,232		5,488		1,996		6,322		–		12,176		540		12,208
Reinvested capital gains		78		–		–		1,259		–		–		–		13,263
Net increase (decrease) in contract owners’ equity resulting from operations	$	9,200		6,029		1,731		7,350		2,946		11,863		305		23,918

(Continued)

6

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF OPERATIONS, Continued

Year Ended December 31, 2006

Investment activity:	GVITSmComp			GVITUSGro		GVITVKVal		GVITMltSec		GVITWLead		JanForty		JanGlTech		JanIntGro
Reinvested dividends	$	129		41		795		2,890		339		270		–		2,608
Mortality and expense risk charges (note 2)		(1,958	)	(181	)	(633	)	(859	)	(538	)	(2,602	)	(487	)	(1,994	)
Net investment income (loss)		(1,829	)	(140	)	162		2,031		(199	)	(2,332	)	(487	)	614
Proceeds from mutual fund shares sold		46,235		697		18,794		1,350		538		2,907		820		33,406
Cost of mutual fund shares sold		(37,816	)	(701	)	(16,124	)	(1,321	)	(412	)	(2,921	)	(1,450	)	(23,033	)
Realized gain (loss) on investments		8,419		(4	)	2,670		29		126		(14	)	(630	)	10,373
Change in unrealized gain (loss) on investments		2,431		(133	)	1,710		79		8,005		16,452		3,291		40,788
Net gain (loss) on investments		10,850		(137	)	4,380		108		8,131		16,438		2,661		51,161
Reinvested capital gains		2,894		206		2,101		122		–		–		–		–
Net increase (decrease) in contract owners’ equity resulting from operations	$	11,915		(71	)	6,643		2,261		7,932		14,106		2,174		51,775
Investment activity:	NBAMTGuard			NBAMTMCGr		NBAMTPart		OppCapAp		OppGlSec		OppMSt		OppMidCap		VEWrldEMkt
Reinvested dividends	$	60		–		229		502		1,011		2,410		–		40
Mortality and expense risk charges (note 2)		(122	)	(734	)	(660	)	(1,908	)	(1,423	)	(3,039	)	(1,036	)	(96	)
Net investment income (loss)		(62	)	(734	)	(431	)	(1,406	)	(412	)	(629	)	(1,036	)	(56	)
Proceeds from mutual fund shares sold		122		7,557		48,683		2,326		1,701		14,751		11,212		98
Cost of mutual fund shares sold		(96	)	(6,423	)	(34,516	)	(2,735	)	(1,515	)	(14,370	)	(16,060	)	(73	)
Realized gain (loss) on investments		26		1,134		14,167		(409	)	186		381		(4,848	)	25
Change in unrealized gain (loss) on investments		1,025		5,793		(11,509	)	10,458		10,523		28,277		7,029		1,637
Net gain (loss) on investments		1,051		6,927		2,658		10,049		10,709		28,658		2,181		1,662
Reinvested capital gains		–		–		3,522		–		5,280		–		–		624
Net increase (decrease) in contract owners’equity resulting from operations	$	989		6,193		5,749		8,643		15,577		28,029		1,145		2,230

(Continued)

7

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF OPERATIONS, Continued

Year Ended December 31, 2006

Investment activity:	VEWrldHAs			VKEmMkt		VKMidCapG		VKUSRealEst		WFAVTOpp
Reinvested dividends	$	13		–		–		1,044		–
Mortality and expense risk charges (note 2)		(410	)	(1	)	(44	)	(1,266	)	(1,280	)
Net investment income (loss)		(397	)	(1	)	(44	)	(222	)	(1,280	)
Proceeds from mutual fund shares sold		5,155		2,759		355		23,397		2,058
Cost of mutual fund shares sold		(2,060	)	(2,644	)	(247	)	(10,427	)	(2,139	)
Realized gain (loss) on investments		3,095		115		108		12,970		(81	)
Change in unrealized gain (loss) on investments		(126	)	(97	)	7		8,878		780
Net gain (loss) on investments		2,969		18		115		21,848		699
Reinvested capital gains		1,140		–		199		6,267		9,968
Net increase (decrease) in contract owners’ equity resulting from operations	$	3,712		17		270		27,893		9,387

See accompanying notes to financial statements.

8

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY

Years Ended December 31, 2006 and 2005

	Total					ACVPIncGr				ACVPInt				ACVPVal
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(2,836	)	(10,278	)	246		372		131		(120	)	68		(516	)
Realized gain (loss) on investments		63,540		(15,327	)	61		(68	)	(267	)	(8,664	)	3,259		2,067
Change in unrealized gain (loss) on investments		283,264		192,091		8,877		1,580		14,613		15,825		3,020		(6,863	)
Reinvested capital gains		85,132		62,908		–		–		–		–		9,159		9,192
Net increase (decrease) in contract owners’ equity resulting from operations		429,100		229,394		9,184		1,884		14,477		7,041		15,506		3,880
Equity transactions:
Purchase payments received from contract owners (note 3)		67,195		38,262		–		–		–		–		–		–
Transfers between funds		–		–		110		(5,238	)	–		(3,700	)	(8,767	)	28,552
Surrenders (note 3)		(119,379	)	(202,540	)	(238	)	(2,184	)	(171	)	(2,276	)	(16,426	)	(5,570	)
Death Benefits (note 4)		(13,171	)	(29,068	)	–		–		(2,098	)	(5,416	)	–		–
Deductions for surrender charges (note 2)		(3,918	)	(7,602	)	–		(174	)	–		(198	)	(863	)	(380	)
Adjustments to maintain reserves		(268	)	(86	)	(9	)	(9	)	(2	)	(4	)	9		(3	)
Net equity transactions		(69,541	)	(201,034	)	(137	)	(7,605	)	(2,271	)	(11,594	)	(26,047	)	22,599
Net change in contract owners’ equity		359,559		28,360		9,047		(5,721	)	12,206		(4,553	)	(10,541	)	26,479
Contract owners’ equity beginning of period		3,320,112		3,291,752		59,490		65,211		63,474		68,027		102,484		76,005
Contract owners’ equity end of period	$	3,679,671		3,320,112		68,537		59,490		75,680		63,474		91,943		102,484
CHANGES IN UNITS:
Beginning units		302,238		321,598		5,652		6,392		6,208		7,430		6,278		4,822
Units purchased		15,906		27,096		11		341		–		17		–		1,832
Units redeemed		(19,372	)	(46,456	)	(23	)	(1,081	)	(204	)	(1,239	)	(1,464	)	(376	)
Ending units		298,772		302,238		5,640		5,652		6,004		6,208		4,814		6,278

(Continued)

9

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	CSTLCapV					DryIPSmCap				DrySRGro				DryStkIx
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(21	)	(30	)	(115	)	(96	)	(947	)	(1,098	)	764		560
Realized gain (loss) on investments		173		7		78		(368	)	(561	)	(7,865	)	(211	)	(4,864	)
Change in unrealized gain (loss) on investments		699		328		(118	)	(477	)	7,050		10,710		36,196		12,886
Reinvested capital gains		–		–		156		48		–		–		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		851		305		1		(893	)	5,542		1,747		36,749		8,582
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		–		–		–		–
Transfers between funds		–		–		464		(13,318	)	–		(6,124	)	92		(3,792	)
Surrenders (note 3)		(624	)	–		–		–		–		(5,508	)	–		(7,818	)
Death Benefits (note 4)		–		–		–		–		–		–		(1,272	)	(4,702	)
Deductions for surrender charges (note 2)		(2	)	–		–		–		–		(440	)	–		(614	)
Adjustments to maintain reserves		11		–		–		(20	)	(6	)	7		(14	)	(25	)
Net equity transactions		(615	)	–		464		(13,338	)	(6	)	(12,065	)	(1,194	)	(16,951	)
Net change in contract owners’ equity		236		305		465		(14,231	)	5,536		(10,318	)	35,555		(8,369	)
Contract owners’ equity beginning of period		4,915		4,610		3,624		17,855		72,112		82,430		265,094		273,463
Contract owners’ equity end of period	$	5,151		4,915		4,089		3,624		77,648		72,112		300,649		265,094
CHANGES IN UNITS:
Beginning units		420		420		276		1,438		9,638		11,256		27,430		29,210
Units purchased		–		–		–		33		–		–		12		526
Units redeemed		(46	)	–		–		(1,195	)	–		(1,618	)	(126	)	(2,306	)
Ending units		374		420		276		276		9,638		9,638		27,316		27,430

(Continued)

10

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	DryVIApp					FedQualBd				FidVIPEIS				FidVIPGrS
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	18		(224	)	1,290		894		1,978		210		(1,617	)	(1,430	)
Realized gain (loss) on investments		(12	)	(454	)	(47	)	41		419		650		(857	)	(15,006	)
Change in unrealized gain (loss) on investments		1,940		1,076		30		(1,261	)	1,787		(375	)	9,946		21,489
Reinvested capital gains		–		–		–		266		13,306		3,784		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		1,946		398		1,273		(60	)	17,490		4,269		7,472		5,053
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		–		–		–		–
Transfers between funds		(8	)	(5,918	)	–		13,740		27,270		(314	)	91		(15,548	)
Surrenders (note 3)		–		–		(882	)	(6,554	)	(384	)	(16,428	)	(1,185	)	(1,206	)
Death Benefits (note 4)		–		–		–		–		(2,892	)	–		–		(5,124	)
Deductions for surrender charges (note 2)		–		–		–		(620	)	–		(864	)	–		–
Adjustments to maintain reserves		(8	)	3		(5	)	3		2		2		(2	)	(28	)
Net equity transactions		(16	)	(5,915	)	(887	)	6,569		23,996		(17,604	)	(1,096	)	(21,906	)
Net change in contract owners’ equity		1,930		(5,517	)	386		6,509		41,486		(13,335	)	6,376		(16,853	)
Contract owners’ equity beginning of period		13,153		18,670		48,215		41,706		88,880		102,215		142,395		159,248
Contract owners’ equity end of period	$	15,083		13,153		48,601		48,215		130,366		88,880		148,771		142,395
CHANGES IN UNITS:
Beginning units		1,306		1,908		3,676		3,176		7,136		8,558		17,084		19,908
Units purchased		–		10		–		1,049		1,947		1,419		12		–
Units redeemed		(2	)	(612	)	(68	)	(549	)	(243	)	(2,841	)	(136	)	(2,824	)
Ending units		1,304		1,306		3,608		3,676		8,840		7,136		16,960		17,084

(Continued)

11

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	FidVIPHIS					FidVIPOvS				FidVIPConS				FidVIPGrOpS
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	1,019		1,148		(344	)	(312	)	(413	)	(1,690	)	(136	)	(116	)
Realized gain (loss) on investments		30		532		1,601		(1,901	)	6,128		4,600		(10	)	(2,942	)
Change in unrealized gain (loss) on investments		(305	)	(1,741	)	6,928		7,915		(3,664	)	17,850		818		3,859
Reinvested capital gains		–		–		344		196		12,506		24		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		744		(61	)	8,529		5,898		14,557		20,784		672		801
Equity transactions:
Purchase payments received from contract owners (note 3)		2,620		–		14,781		54		–		14,004		–		–
Transfers between funds		6,202		(6,036	)	1,459		(7,188	)	(1,951	)	23,204		–		(11,136	)
Surrenders (note 3)		(805	)	(1,546	)	(1,593	)	(548	)	(16,164	)	(13,642	)	–		–
Death Benefits (note 4)		–		–		–		–		–		–		–		–
Deductions for surrender charges (note 2)		(8	)	–		(19	)	(18	)	(30	)	(550	)	–		–
Adjustments to maintain reserves		(5	)	8		(10	)	(6	)	(11	)	(9	)	(2	)	10
Net equity transactions		8,004		(7,574	)	14,618		(7,706	)	(18,156	)	23,007		(2	)	(11,126	)
Net change in contract owners’ equity		8,748		(7,635	)	23,147		(1,808	)	(3,599	)	43,791		670		(10,325	)
Contract owners’ equity beginning of period		6,542		14,177		40,228		42,036		158,610		114,819		17,490		27,815
Contract owners’ equity end of period	$	15,290		6,542		63,375		40,228		155,011		158,610		18,160		17,490
CHANGES IN UNITS:
Beginning units		682		1,494		3,604		4,418		11,450		9,550		2,144		3,660
Units purchased		852		–		1,435		382		–		2,386		–		–
Units redeemed		(80	)	(812	)	(157	)	(1,196	)	(1,280	)	(486	)	–		(1,516	)
Ending units		1,454		682		4,882		3,604		10,170		11,450		2,144		2,144

(Continued)

12

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	FidVIPVaIS					GVITEmMrkts				GVITFHiInc				GVITGlHlth
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(71	)	(114	)	(343	)	(308	)	1,822		1,676		(54	)	(90	)
Realized gain (loss) on investments		(10	)	(538	)	2,282		2,422		118		(8	)	120		42
Change in unrealized gain (loss) on investments		56		(613	)	11,836		5,504		729		(1,240	)	(25	)	(272	)
Reinvested capital gains		1,162		490		557		3,690		–		–		–		706
Net increase (decrease) in contract owners’ equity resulting from operations		1,137		(775	)	14,332		11,308		2,669		428		41		386
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		–		–		–		–
Transfers between funds		1,476		6,382		(990	)	17,024		–		11,488		(3,755	)	354
Surrenders (note 3)		–		(7,750	)	–		(3,622	)	(662	)	(234	)	–		–
Death Benefits (note 4)		–		–		–		–		(1,546	)	–		–		–
Deductions for surrender charges (note 2)		–		–		–		(468	)	–		(8	)	–		–
Adjustments to maintain reserves		17		6		(16	)	11		(6	)	(14	)	(26	)	13
Net equity transactions		1,493		(1,362	)	(1,006	)	12,945		(2,214	)	11,232		(3,781	)	367
Net change in contract owners’ equity		2,630		(2,137	)	13,326		24,253		455		11,660		(3,740	)	753
Contract owners’ equity beginning of period		6,685		8,822		44,548		20,295		30,623		18,963		6,486		5,733
Contract owners’ equity end of period	$	9,315		6,685		57,874		44,548		31,078		30,623		2,746		6,486
CHANGES IN UNITS:
Beginning units		508		678		2,588		1,542		2,390		1,494		512		484
Units purchased		110		–		3		1,406		–		917		–		214
Units redeemed		–		(170	)	(97	)	(360	)	(166	)	(21	)	(298	)	(186	)
Ending units		618		508		2,494		2,588		2,224		2,390		214		512

(Continued)

13

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	GVITGlTech					GVITGlUtl1				GVITGvtBd				GVITGrowth
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(39	)	(36	)	51		62		2,493		1,944		(506	)	(448	)
Realized gain (loss) on investments		1		(3	)	(221	)	(1	)	(144	)	(422	)	(653	)	(173	)
Change in unrealized gain (loss) on investments		306		(15	)	1,640		(817	)	(1,356	)	(126	)	3,426		2,320
Reinvested capital gains		–		–		349		1,002		670		142		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		268		(54	)	1,819		246		1,663		1,538		2,267		1,699
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		3,668		10,642		7,337		–
Transfers between funds		–		–		(2,851	)	7,028		5,071		(10,666	)	494		–
Surrenders (note 3)		–		–		–		–		(858	)	–		(829	)	–
Death Benefits (note 4)		–		–		–		–		–		–		–		–
Deductions for surrender charges (note 2)		–		–		–		–		(9	)	–		(17	)	–
Adjustments to maintain reserves		–		–		(11	)	27		2		(38	)	2		(3	)
Net equity transactions		–		–		(2,862	)	7,055		7,874		(62	)	6,987		(3	)
Net change in contract owners’ equity		268		(54	)	(1,043	)	7,301		9,537		1,476		9,254		1,696
Contract owners’ equity beginning of period		2,785		2,839		7,301		–		86,878		85,402		35,519		33,823
Contract owners’ equity end of period	$	3,053		2,785		6,258		7,301		96,415		86,878		44,773		35,519
CHANGES IN UNITS:
Beginning units		944		944		516		–		6,532		6,538		6,428		6,428
Units purchased		–		–		–		516		647		1,065		1,468		–
Units redeemed		–		–		(190	)	–		(65	)	(1,071	)	(156	)	–
Ending units		944		944		326		516		7,114		6,532		7,740		6,428

(Continued)

14

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	GVITIntGro					GVITJPBal				GVITMdCpGr				GVITMdCpIdx
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(110	)	(12	)	541		330		(265	)	(230	)	(231	)	(336	)
Realized gain (loss) on investments		2,179		1		352		(151	)	(91	)	(888	)	503		10,146
Change in unrealized gain (loss) on investments		7,053		1,213		5,136		418		2,087		2,242		5,819		(6,855	)
Reinvested capital gains		78		22		–		–		–		–		1,259		5,116
Net increase (decrease) in contract owners’ equity resulting from operations		9,200		1,224		6,029		597		1,731		1,124		7,350		8,071
Equity transactions:
Purchase payments received from contract owners (note 3)		6,813		–		–		–		3,144		–		–		–
Transfers between funds		15,936		8,818		2,928		(10,304	)	(3,068	)	1,310		(23	)	(9,592	)
Surrenders (note 3)		(747	)	–		(524	)	(372	)	(582	)	(230	)	–		(11,230	)
Death Benefits (note 4)		–		–		(2,462	)	–		–		–		–		–
Deductions for surrender charges (note 2)		(16	)	–		(2	)	(12	)	(15	)	(8	)	–		(246	)
Adjustments to maintain reserves		9		14		9		(13	)	(2	)	11		(23	)	(18	)
Net equity transactions		21,995		8,832		(51	)	(10,701	)	(523	)	1,083		(46	)	(21,086	)
Net change in contract owners’ equity		31,195		10,056		5,978		(10,104	)	1,208		2,207		7,304		(13,015	)
Contract owners’ equity beginning of period		10,056		–		55,325		65,429		17,330		15,123		87,890		100,905
Contract owners’ equity end of period	$	41,251		10,056		61,303		55,325		18,538		17,330		95,194		87,890
CHANGES IN UNITS:
Beginning units		1,072		–		5,394		6,450		2,012		1,900		4,862		6,170
Units purchased		2,398		1,072		282		20		42		762		–		–
Units redeemed		(116	)	–		(276	)	(1,076	)	(68	)	(650	)	(2	)	(1,308	)
Ending units		3,354		1,072		5,400		5,394		1,986		2,012		4,860		4,862

(Continued)

15

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	GVITMyMkt					GVITNWFund				GVITNWLead			GVITSmCapGr
Investment activity:	2006			2005		2006		2005		2006	2005		2006		2005
Net investment income (loss)	$	2,946		1,612		(313	)	(542	)	–	(6	)	(235	)	(330	)
Realized gain (loss) on investments		–		–		75		(925	)	–	101		13		(1,698	)
Change in unrealized gain (loss) on investments		–		–		12,101		7,534		–	–		527		2,908
Reinvested capital gains		–		–		–		–		–	102		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		2,946		1,612		11,863		6,067		–	197		305		880
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		–	–		–		–
Transfers between funds		(40,765	)	30,266		54		(8,856	)	–	(200	)	–		(13,568	)
Surrenders (note 3)		–		(63,392	)	–		(8,642	)	–	–		(95	)	–
Death Benefits (note 4)		(1,609	)	–		–		–		–	–		–		–
Deductions for surrender charges (note 2)		–		(988	)	–		(688	)	–	–		–		–
Adjustments to maintain reserves		(28	)	(27	)	(22	)	(20	)	–	3		13		(12	)
Net equity transactions		(42,402	)	(34,141	)	32		(18,206	)	–	(197	)	(82	)	(13,580	)
Net change in contract owners’ equity		(39,456	)	(32,529	)	11,895		(12,139	)	–	–		223		(12,700	)
Contract owners’ equity beginning of period		127,812		160,341		98,388		110,527		–	–		16,912		29,612
Contract owners’ equity end of period	$	88,356		127,812		110,283		98,388		–	–		17,135		16,912
CHANGES IN UNITS:
Beginning units		11,904		15,118		9,236		10,992		–	–		1,360		2,538
Units purchased		–		196		5		815		–	–		1		–
Units redeemed		(3,920	)	(3,410	)	(1	)	(2,571	)	–	–		(7	)	(1,178	)
Ending units		7,984		11,904		9,240		9,236		–	–		1,354		1,360

(Continued)

16

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	GVITSmCapVal					GVITSmComp				GVITUSGro				GVITVKVal
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(1,553	)	(1,980	)	(1,829	)	(1,654	)	(140	)	(194	)	162		132
Realized gain (loss) on investments		1,394		3,175		8,419		1,216		(4	)	398		2,670		771
Change in unrealized gain (loss) on investments		10,814		(17,079	)	2,431		(2,013	)	(133	)	(1,707	)	1,710		(540	)
Reinvested capital gains		13,263		17,418		2,894		15,074		206		2,070		2,101		1,422
Net increase (decrease) in contract owners’ equity resulting from operations		23,918		1,534		11,915		12,623		(71	)	567		6,643		1,785
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		2,620		–		9		–		7,336		–
Transfers between funds		1,460		(10,818	)	2,422		5,886		2,680		–		(15,827	)	22,528
Surrenders (note 3)		(710	)	(3,290	)	(24,612	)	(1,000	)	(294	)	(7,842	)	(822	)	(4,686	)
Death Benefits (note 4)		–		–		–		–		–		–		–		–
Deductions for surrender charges (note 2)		(2	)	–		(1,284	)	(96	)	(6	)	–		(17	)	(626	)
Adjustments to maintain reserves		(12	)	9		–		1		5		17		(7	)	2
Net equity transactions		736		(14,099	)	(20,854	)	4,791		2,394		(7,825	)	(9,337	)	17,218
Net change in contract owners’ equity		24,654		(12,565	)	(8,939	)	17,414		2,323		(7,258	)	(2,694	)	19,003
Contract owners’ equity beginning of period		151,829		164,394		128,001		110,587		12,420		19,678		56,597		37,594
Contract owners’ equity end of period	$	176,483		151,829		119,062		128,001		14,743		12,420		53,903		56,597
CHANGES IN UNITS:
Beginning units		7,546		8,304		6,670		6,382		830		1,452		5,712		3,900
Units purchased		70		–		215		367		194		–		755		2,374
Units redeemed		(32	)	(758	)	(1,269	)	(79	)	(22	)	(622	)	(1,707	)	(562	)
Ending units		7,584		7,546		5,616		6,670		1,002		830		4,760		5,712

(Continued)

17

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	GVITMltSec					GVITWLead				JanForty				JanGlTech
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	2,031		1,160		(199	)	(48	)	(2,332	)	(2,416	)	(487	)	(508	)
Realized gain (loss) on investments		29		721		126		6		(14	)	(2,362	)	(630	)	(7,695	)
Change in unrealized gain (loss) on investments		79		(2,039	)	8,005		1,567		16,452		22,762		3,291		11,393
Reinvested capital gains		122		298		–		–		–		–		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		2,261		140		7,932		1,525		14,106		17,984		2,174		3,190
Equity transactions:
Purchase payments received from contract owners (note 3)		2,620		–		–		–		–		–		–		–
Transfers between funds		28,266		33,856		23,332		5,282		–		(7,866	)	–		(6,348	)
Surrenders (note 3)		(290	)	(1,874	)	–		–		(293	)	–		(293	)	(1,150	)
Death Benefits (note 4)		–		–		–		–		–		–		–		–
Deductions for surrender charges (note 2)		(6	)	(178	)	–		–		–		–		(10	)	(78	)
Adjustments to maintain reserves		(1	)	23		1		9		(1	)	(17	)	(4	)	(2	)
Net equity transactions		30,589		31,827		23,333		5,291		(294	)	(7,883	)	(307	)	(7,578	)
Net change in contract owners’ equity		32,850		31,967		31,265		6,816		13,812		10,101		1,867		(4,388	)
Contract owners’ equity beginning of period		54,943		22,976		13,240		6,424		185,712		175,611		34,565		38,953
Contract owners’ equity end of period	$	87,793		54,943		44,505		13,240		199,524		185,712		36,432		34,565
CHANGES IN UNITS:
Beginning units		4,068		1,714		1,268		724		23,350		24,508		9,378		11,626
Units purchased		2,242		2,507		2,166		544		–		–		–		–
Units redeemed		(22	)	(153	)	–		–		(36	)	(1,158	)	(82	)	(2,248	)
Ending units		6,288		4,068		3,434		1,268		23,314		23,350		9,296		9,378

(Continued)

18

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	JanIntGro					NBAMTGuard				NBAMTMCGr				NBAMTPart
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	614		(262	)	(62	)	(100	)	(734	)	(742	)	(431	)	(168	)
Realized gain (loss) on investments		10,373		(190	)	26		14		1,134		(714	)	14,167		164
Change in unrealized gain (loss) on investments		40,788		26,596		1,025		625		5,793		7,494		(11,509	)	8,534
Reinvested capital gains		–		–		–		–		–		–		3,522		14
Net increase (decrease) in contract owners’ equity resulting from operations		51,775		26,144		989		539		6,193		6,038		5,749		8,544
Equity transactions:
Purchase payments received from contract owners (note 3)		6,289		–		–		–		–		–		–		13,566
Transfers between funds		(1,665	)	9,462		–		–		(1,082	)	(5,366	)	(33,696	)	9,870
Surrenders (note 3)		(20,872	)	–		–		–		(937	)	–		(14,060	)	–
Death Benefits (note 4)		–		–		–		–		–		(4,106	)	–		–
Deductions for surrender charges (note 2)		(1,063	)	–		–		–		(2	)	–		–		–
Adjustments to maintain reserves		1		(1	)	(1	)	–		(1	)	(13	)	(18	)	14
Net equity transactions		(17,310	)	9,461		(1	)	–		(2,022	)	(9,485	)	(47,774	)	23,450
Net change in contract owners’ equity		34,465		35,605		988		539		4,171		(3,447	)	(42,025	)	31,994
Contract owners’ equity beginning of period		119,503		83,898		8,380		7,841		51,720		55,167		75,319		43,325
Contract owners’ equity end of period	$	153,968		119,503		9,368		8,380		55,891		51,720		33,294		75,319
CHANGES IN UNITS:
Beginning units		13,104		11,970		648		648		4,544		5,436		5,338		3,574
Units purchased		422		1,135		–		–		–		–		–		1,764
Units redeemed		(1,850	)	(1	)	–		–		(202	)	(892	)	(3,206	)	–
Ending units		11,676		13,104		648		648		4,342		4,544		2,132		5,338

(Continued)

19

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	OppCapAp					OppGlSec				OppMSt				OppMidCap
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(1,406	)	(660	)	(412	)	(294	)	(629	)	(138	)	(1,036	)	(1,076	)
Realized gain (loss) on investments		(409	)	(5,560	)	186		(966	)	381		(2,942	)	(4,848	)	(8,276	)
Change in unrealized gain (loss) on investments		10,458		10,886		10,523		11,282		28,277		11,573		7,029		17,304
Reinvested capital gains		–		–		5,280		–		–		–		–		–
Net increase (decrease) in contract owners’ equity resulting from operations		8,643		4,666		15,577		10,022		28,029		8,493		1,145		7,952
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		(4	)	7,337		–		–		–
Transfers between funds		–		10,088		2,670		18,584		(7,058	)	(5,792	)	–		(7,498	)
Surrenders (note 3)		(404	)	–		–		(8,810	)	(2,654	)	(942	)	(9,679	)	(2,494	)
Death Benefits (note 4)		–		(4,222	)	–		–		(1,292	)	–		–		–
Deductions for surrender charges (note 2)		(2	)	–		–		–		(40	)	(32	)	(483	)	(200	)
Adjustments to maintain reserves		(25	)	11		(19	)	20		(20	)	(30	)	(5	)	(33	)
Net equity transactions		(431	)	5,877		2,651		9,790		(3,727	)	(6,796	)	(10,167	)	(10,225	)
Net change in contract owners’ equity		8,212		10,543		18,228		19,812		24,302		1,697		(9,022	)	(2,273	)
Contract owners’ equity beginning of period		134,096		123,553		95,111		75,299		206,303		204,606		75,181		77,454
Contract owners’ equity end of period	$	142,308		134,096		113,339		95,111		230,605		206,303		66,159		75,181
CHANGES IN UNITS:
Beginning units		12,090		11,544		8,044		7,178		20,618		21,368		7,570		8,638
Units purchased		–		948		218		1,246		80		681		–		291
Units redeemed		(36	)	(402	)	(2	)	(380	)	(378	)	(1,431	)	(1,008	)	(1,359	)
Ending units		12,054		12,090		8,260		8,044		20,320		20,618		6,562		7,570

(Continued)

20

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	VEWrldEMkt					VEWrldHAs				VKEmMkt				VKMidCapG
Investment activity:	2006			2005		2006		2005		2006		2005		2006		2005
Net investment income (loss)	$	(56	)	(26	)	(397	)	(178	)	(1	)	(8	)	(44	)	(40	)
Realized gain (loss) on investments		25		2,806		3,095		469		115		26		108		95
Change in unrealized gain (loss) on investments		1,637		(1,092	)	(126	)	6,583		(97	)	97		7		382
Reinvested capital gains		624		–		1,140		–		–		–		199		–
Net increase (decrease) in contract owners’ equity resulting from operations		2,230		1,688		3,712		6,874		17		115		270		437
Equity transactions:
Purchase payments received from contract owners (note 3)		–		–		–		–		–		–		1		–
Transfers between funds		–		(756	)	10,257		516		(2,758	)	3,676		89		(282	)
Surrenders (note 3)		–		–		–		–		–		(960	)	–		–
Death Benefits (note 4)		–		–		–		–		–		–		–		–
Deductions for surrender charges (note 2)		–		–		–		–		–		(92	)	–		–
Adjustments to maintain reserves		4		(23	)	2		(26	)	(33	)	35		(7	)	12
Net equity transactions		4		(779	)	10,259		490		(2,791	)	2,659		83		(270	)
Net change in contract owners’ equity		2,234		909		13,971		7,364		(2,774	)	2,774		353		167
Contract owners’ equity beginning of period		5,950		5,041		20,301		12,937		2,774		–		3,006		2,839
Contract owners’ equity end of period	$	8,184		5,950		34,272		20,301		–		2,774		3,359		3,006
CHANGES IN UNITS:
Beginning units		292		322		810		772		126		–		380		416
Units purchased		–		47		304		40		–		174		15		–
Units redeemed		–		(77	)	–		(2	)	(126	)	(48	)	(1	)	(36	)
Ending units		292		292		1,114		810		–		126		394		380

(Continued)

21

NATIONWIDE VARIABLE ACCOUNT-10

STATEMENTS OF CHANGES IN CONTRACT OWNERS’ EQUITY, Continued

Years Ended December 31, 2006 and 2005

	VKUSRealEst					WFAVTOpp
Investment activity:	2006			2005		2006		2005
Net investment income (loss)	$	(222	)	(504	)	(1,280	)	(1,298	)
Realized gain (loss) on investments		12,970		33,306		(81	)	(3,459	)
Change in unrealized gain (loss) on investments		8,878		(25,269	)	780		9,750
Reinvested capital gains		6,267		1,832		9,968		–
Net increase (decrease) in contract owners’ equity resulting from operations		27,893		9,365		9,387		4,993
Equity transactions:
Purchase payments received from contract owners (note 3)		2,620		–		–		–
Transfers between funds		(8,559	)	(78,500	)	–		(13,190	)
Surrenders (note 3)		–		(10,026	)	(690	)	(714	)
Death Benefits (note 4)		–		–		–		(5,498	)
Deductions for surrender charges (note 2)		–		–		(22	)	(24	)
Adjustments to maintain reserves		27		37		(20	)	–
Net equity transactions		(5,912	)	(88,489	)	(732	)	(19,426	)
Net change in contract owners’ equity		21,981		(79,124	)	8,655		(14,433	)
Contract owners’ equity beginning of period		75,433		154,557		88,484		102,917
Contract owners’ equity end of period	$	97,414		75,433		97,139		88,484
CHANGES IN UNITS:
Beginning units		2,730		6,456		7,880		9,750
Units purchased		–		–		–		–
Units redeemed		(140	)	(3,726	)	(62	)	(1,870	)
Ending units		2,590		2,730		7,818		7,880

See accompanying notes to financial statements.

22

NATIONWIDE VARIABLE ACCOUNT-10

NOTES TO FINANCIAL STATEMENTS

December 31, 2006 and 2005

(1) Background and Summary of Significant Accounting Policies

(a) Organization and Nature of Operations

The Nationwide Variable Account-10 (the Account) was established pursuant to a resolution of the Board of Directors of Nationwide Life Insurance Company (the Company) on March 31, 1999. The Account is registered as a unit investment trust under the Investment Company Act of 1940.

The Company offers tax qualified and non-tax qualified Individual Deferred Variable Annuity Contracts through the Account. The primary distribution for the contracts is through the brokerage community; however, other distributors are utilized.

(b) The Contracts

Only contracts without a front-end sales charge, but with a contingent deferred sales charge and certain other fees, are offered for purchase. See note 2 for a discussion of contract expenses.

Contract owners in either the accumulation or payout phase may invest in the following:

Portfolios of the American Century Variable Portfolios Inc.;

    American Century Variable Portfolios Inc. – Income & Growth Fund – Class I (ACVPIncGr)

    American Century Variable Portfolios Inc. – International Fund – Class I (ACVPInt)

    American Century Variable Portfolios Inc. – Ultra^® Fund – Class I (ACVPUltra)*

    American Century Variable Portfolios Inc. – Value Fund – Class I (ACVPVal)

Portfolios of the Credit Suisse Trust;

    Credit Suisse Trust – Global Small Cap Portfolio (CSTGlSmCp)*

    Credit Suisse Trust – International Focus Portfolio (CSTIntFoc)*

    Credit Suisse Trust – Large Cap Value Portfolio (CSTLCapV)

Portfolios of the Dreyfus Investment Portfolios;

    Dreyfus Investment Portfolios – Small Cap Stock Index Portfolio – Service Shares (DryIPSmCap)

Dreyfus Socially Responsible Growth Fund Inc. – Initial Shares The (DrySRGro)

Dreyfus Stock Index Fund Inc. – Initial Shares (DryStkIx)

Dreyfus Variable Investment Fund – Appreciation Portfolio – Initial Shares (DryVIApp)

Portfolios of the Federated Insurance Series;

    Federated Insurance Series – Federated Quality Bond Fund II – Primary Shares (FedQualBd)

Portfolios of the Fidelity^® Variable Insurance Products Fund;

    Fidelity^® Variable Insurance Products Fund – Equity-Income Portfolio – Service Class (FidVIPEIS)

    Fidelity^® Variable Insurance Products Fund – Growth Portfolio – Service Class (FidVIPGrS)

    Fidelity^® Variable Insurance Products Fund – High Income Portfolio – Service Class (FidVIPHIS)

    Fidelity^® Variable Insurance Products Fund – Overseas Portfolio – Service Class (FidVIPOvS)

Portfolio of the Fidelity^® Variable Insurance Products Fund II;

    Fidelity^® Variable Insurance Products Fund II – Contrafund^® Portfolio – Service Class (FidVIPConS)

Portfolios of the Fidelity^® Variable Insurance Products Fund III;

    Fidelity^® Variable Insurance Products Fund III – Growth Opportunities Portfolio – Service Class

        (FidVIPGrOpS)

    Fidelity^® Variable Insurance Products Fund III – Value Strategies Portfolio – Service Class (FidVIPVaIS)

(Continued)

23

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

Portfolios of the Gartmore Variable Insurance Trust (GVIT);

    Gartmore GVIT – Emerging Markets Fund – Class I (GVITEmMrkts)

    Gartmore GVIT – Federated GGVIT High Income Bond Fund – Class I (GVITFHiInc)

    Gartmore GVIT – Global Financial Services Fund – Class I (GVITGlFin)*

    Gartmore GVIT – Global Health Sciences Fund – Class I (GVITGlHlth)

    Gartmore GVIT – Global Technology and Communications Fund – Class I (GVITGlTech)

    Gartmore GVIT – Global Utilities Fund – Class I (GVITGlUtl)

    Gartmore GVIT – Government Bond Fund – Class I (GVITGvtBd)

    Gartmore GVIT – Growth Fund – Class I (GVITGrowth)

    Gartmore GVIT – International Growth Fund – Class I (GVITIntGro)

    Gartmore GVIT – J.P. Morgan GVIT Balanced Fund – Class I (GVITJPBal)

    Gartmore GVIT – Mid Cap Growth Fund – Class I (GVITMdCpGr)

    Gartmore GVIT – Mid Cap Index Fund – Class I (GVITMdCpIdx)

    Gartmore GVIT – Money Market Fund – Class I (GVITMyMkt)

    Gartmore GVIT – Nationwide Fund – Class I (GVITNWFund)

    Gartmore GVIT – Nationwide Leaders Fund – Class I (GVITNWLead)*

    Gartmore GVIT – Small Cap Growth Fund – Class I (GVITSmCapGr)

    Gartmore GVIT – Small Cap Value Fund – Class I (GVITSmCapVal)

    Gartmore GVIT – Small Company Fund – Class I (GVITSmComp)

    Gartmore GVIT – U.S. Growth Leaders Fund – Class I (GVITUSGro)

    Gartmore GVIT – Van Kampen GGVIT Comstock Value Fund – Class I (GVITVKVal)

    Gartmore GVIT – Van Kampen GVIT Multi Sector Bond Fund – Class I (GVITMltSec)

    Gartmore GVIT – Worldwide Leaders Fund – Class I (GVITWLead)

Portfolios of the Janus Aspen Series;

    Janus Aspen Series – Forty Portfolio – Service Shares (JanForty)

    Janus Aspen Series – Global Technology Portfolio – Service Shares (JanGlTech)

    Janus Aspen Series – International Growth Portfolio – Service Shares (JanIntGroS)

Portfolios of the Neuberger Berman Advisers Management Trust;

    Neuberger Berman Advisers Management Trust – Guardian Portfolio – I Class Shares (NBAMTGuard)

    Neuberger Berman Advisers Management Trust – Mid Cap Growth Portfolio – I Class Shares         (NBAMTMCGr)

    Neuberger Berman Advisers Management Trust – Partners Portfolio – Class I (NBAMTPart)

Portfolios of the Oppenheimer Variable Account Funds;

    Oppenheimer Variable Account Funds – Oppenheimer Capital Appreciation Fund/VA –

        Non-Service Shares (OppCapAp) (formerly Oppenheimer Variable Account Funds –

            Oppenheimer Capital Appreciation Fund/VA – Initial Class)

    Oppenheimer Variable Account Funds – Oppenheimer Global Securities Fund/VA –

        Non-Service Shares (OppGlSec) (formerly Oppenheimer Variable Account Funds –

            Oppenheimer Global Securities Fund/VA – Initial Class)

    Oppenheimer Variable Account Funds – Oppenheimer Main Street^® Fund/VA –

        Non-Service Shares (OppMSt) (formerly Oppenheimer Variable Account Funds –

            Oppenheimer Main Street Fund^®/VA – Initial Class)

    Oppenheimer Variable Account Funds – Oppenheimer Mid Cap Fund/VA –

        Non-Service Shares (OppMidCap) (formerly Oppenheimer Variable Account Funds –

            Oppenheimer Aggressive Growth Fund/VA – Initial Class)

Portfolios of the Van Eck Worldwide Insurance Trust;

    Van Eck Worldwide Insurance Trust – Worldwide Emerging Markets Fund – Initial Class (VEWrldEMkt)

    Van Eck Worldwide Insurance Trust – Worldwide Hard Assets Fund – Initial Class (VEWrldHAs)

(Continued)

24

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

Portfolios of the Van Kampen – The Universal Institutional Funds Inc.;

    Van Kampen – The Universal Institutional Funds Inc. – Emerging Markets Debt Portfolio –

        Class I (VKEmMkt)*

    Van Kampen – The Universal Institutional Funds Inc. – Mid Cap Growth Portfolio – Class I (VKMidCapG)

    Van Kampen – The Universal Institutional Funds Inc. – U.S. Real Estate Portfolio – Class I (VKUSRealEst)

Portfolio of the Wells Fargo Advantage Funds^SM;

    Wells Fargo Advantage Funds^SM – Opportunity Fund – Investor Class (WFAFOpp)*

Portfolio of the Wells Fargo Advantage Variable Trust Funds^SM;

    Wells Fargo Advantage Variable Trust Funds^SM –

        Wells Fargo Advantage VT Opportunity Fund^SM (WFAVTOpp)

At December 31, 2006, contract owners were invested in all of the above funds except for those indicated with an asterisk(*). The contract owners’ equity is affected by the investment results of each fund, equity transactions by contract owners and certain contract expenses (see note 2).

The accompanying financial statements include only contract owners’ purchase payments pertaining to the variable portions of their contracts and exclude any purchase payments for fixed dollar benefits, the latter being included in the accounts of the Company.

A contract owner may choose from among a number of different underlying mutual fund options. The underlying mutual fund options are not available to the general public directly. The underlying mutual funds are available as investment options in variable life insurance policies or variable annuity contracts issued by life insurance companies or, in some cases, through participation in certain qualified pension or retirement plans.

A purchase payment could be presented as a negative equity transaction in the Statements of Changes in Contract Owners’ Equity if a prior period purchase payment is refunded to a contract owner due to a contract cancellation during the free look period, and/or if a gain is realized by the contract owner during the free look period.

Some of the underlying mutual funds have been established by investment advisers which manage publicly traded mutual funds having similar names and investment objectives. While some of the underlying mutual funds may be similar to, and may in fact be modeled after, publicly traded mutual funds, the underlying mutual funds are not otherwise directly related to any publicly traded mutual fund. Consequently, the investment performance of publicly traded mutual funds and any corresponding underlying mutual funds may differ substantially.

(c) Security Valuation, Transactions and Related Investment Income

Investments in underlying mutual funds are valued on the closing net asset value per share at December 31, 2006 of such funds, which value their investment securities at fair value. Fund purchases and sales are accounted for on the trade date (date the order to buy or sell is executed). The cost of investments sold is determined on a First in – First out basis, and dividends (which include capital gain distributions) are accrued as of the ex-dividend date and are reinvested in the underlying mutual funds.

(d) Federal Income Taxes

Operations of the Account form a part of, and are taxed with, operations of the Company, which is taxed as a life insurance company under the provisions of the Internal Revenue Code.

The Company does not provide for income taxes within the Account. Taxes are the responsibility of the contract owner upon termination or withdrawal.

(e) Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S generally accepted accounting principles may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(Continued)

25

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

(f) New Accounting Pronouncement

In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard (SFAS) 157. SFAS 157 also provides guidance regarding the extent to which companies measure assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurements on earnings. SFAS 157 applies whenever other standards require (or permit) assets or liabilities to be measured at fair value but does not expand the use of fair value in any new circumstances. SFAS 157 is effective for fiscal years beginning after November 15, 2007, with early adoption permitted. SFAS 157 is not expected to have a material impact on the Accounts’ financial position or results of their operations upon adoption.

(2) Expenses

The Company does not deduct a sales charge from purchase payments received from the contract owners. However, if any part of the contract value of such contracts is surrendered, the company will, with certain exceptions, deduct from a contract owners’ contract value a contingent deferred sales charge not to exceed 8% of purchase payments surrendered. After 5 years, such charge will decline 1% per year. After the purchase payment has been held in the contract for 13 years, the charge is 0%. No sales charges are deducted on redemptions used to purchase units in the fixed investment options of the Company.

The Company deducts a mortality and expense risk charge assessed through the daily unit value calculation equal to an annualized rate of 1.40%.

(3) Related Party Transactions

The Company performs various services on behalf of the Mutual Fund Companies in which the Account invests and may receive fees for the services performed. These services include, among other things, shareholder communications, preparation, postage, fund transfer agency and various other record keeping and customer service functions. These fees are paid to an affiliate of the Company.

Contract owners may, with certain restrictions, transfer their assets between the Account and a fixed dollar contract (fixed account) maintained in the accounts of the Company. These transfers are the result of the contract owner executing fund exchanges. Fund exchanges from the Account to the fixed account are included in surrenders, and fund exchanges from the fixed account to the Account are included in purchase payments received from contact owners, as applicable, on the accompanying Statements of Change in Contract Owners’ Equity.

For the periods ended December 31, 2006 and 2005, total transfers into the Account from the fixed account were $67,195 and $38,190, respectively, and total transfers from the Account to the fixed account were $29,261 and $120,613, respectively.

(4) Death Benefits

Death benefit proceeds result in a redemption of the contract value from the Account and payment of those proceeds, less any policy charges, to the legal beneficiary. In the event that the guaranteed death benefit exceeds the contract value on the date of death, the excess is paid by the Company’s general account.

(Continued)

26

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

(5) Financial Highlights

The following is a summary of units, unit fair values and contract owners’ equity outstanding for variable universal life contracts as of the end of the periods indicated, and the contract expense rate, investment income ratio and total return for each period in the five year period ended December 31, 2006.

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
American Century Variable Portfolios, Inc. – Income & Growth Fund – Class I
2006	1.40%	5,640	$	12.151994	$	68,537	1.78%	15.45%
2005	1.40%	5,652		10.525484		59,490	1.99%	3.17%
2004	1.40%	6,392		10.202044		65,211	1.40%	11.41%
2003	1.40%	6,386		9.157113		58,477	1.53%	27.54%
2002	1.40%	9,108		7.179590		65,392	1.08%	-20.50%
American Century Variable Portfolios, Inc. – International Fund – Class I
2006	1.40%	6,004		12.604859		75,680	1.58%	23.28%
2005	1.40%	6,208		10.224538		63,474	1.22%	11.67%
2004	1.40%	7,430		9.155754		68,027	0.56%	13.32%
2003	1.40%	7,302		8.079877		58,999	0.92%	22.77%
2002	1.40%	12,849		6.581398		84,564	0.78%	-21.49%
American Century Variable Portfolios, Inc. – Value Fund – Class I
2006	1.40%	4,814		19.099026		91,943	1.48%	17.00%
2005	1.40%	6,278		16.324353		102,484	0.85%	3.57%
2004	1.40%	4,822		15.762031		76,005	0.97%	12.73%
2003	1.40%	4,225		13.981741		59,073	0.93%	27.15%
2002	1.40%	3,324		10.995838		36,550	1.14%	-13.84%
Credit Suisse Trust – Large Cap Value Portfolio
2006	1.40%	374		13.773024		5,151	0.97%	17.68%
2005	1.40%	420		11.703385		4,915	0.78%	6.63%
2004	1.40%	420		10.975290		4,610	0.54%	9.78%
2003	1.40%	419		9.997094		4,189	0.77%	23.41%
2002	1.40%	419		8.100504		3,394	1.02%	-24.17%
Dreyfus Investment Portfolios – Small Cap Stock Index Portfolio – Service Shares
2006	1.40%	276		14.814053		4,089	0.28%	12.82%
2005	1.40%	276		13.130152		3,624	0.00%	5.75%
2004	1.40%	1,438		12.416593		17,855	1.48%	20.19%
2002	1.40%	509		7.603573		3,870	0.31%	-23.96%	05/01/02
Dreyfus Socially Responsible Growth Fund, Inc. – Initial Shares, The
2006	1.40%	9,638		8.056423		77,648	0.10%	7.68%
2005	1.40%	9,638		7.482082		72,112	0.00%	2.17%
2004	1.40%	11,256		7.323241		82,430	0.40%	4.72%
2003	1.40%	11,395		6.992920		79,684	0.11%	24.24%
2002	1.40%	13,880		5.628516		78,124	0.22%	-29.94%
Dreyfus Stock Index Fund, Inc. – Initial Shares
2006	1.40%	27,316		11.006315		300,649	1.67%	13.89%
2005	1.40%	27,430		9.664366		265,094	1.61%	3.23%
2004	1.40%	29,210		9.361970		273,463	1.82%	9.09%
2003	1.40%	28,983		8.581727		248,724	1.49%	26.57%
2002	1.40%	32,559		6.780318		220,760	1.34%	-23.45%
Dreyfus Variable Investment Fund – Appreciation Portfolio – Initial Shares
2006	1.40%	1,304		11.566843		15,083	1.52%	14.85%
2005	1.40%	1,306		10.071157		13,153	0.02%	2.92%
2004	1.40%	1,908		9.785354		18,670	1.74%	3.58%
2003	1.40%	1,827		9.447547		17,261	0.84%	19.47%
2002	1.40%	4,480		7.907593		35,426	1.09%	-17.88%
Federated Insurance Series – Federated Quality Bond Fund II – Primary Shares
2006	1.40%	3,608		13.470373		48,601	4.09%	2.70%
2005	1.40%	3,676		13.116237		48,215	3.26%	-0.12%
2004	1.40%	3,176		13.131591		41,706	4.02%	2.17%
2003	1.40%	3,450		12.852793		44,342	4.88%	3.18%
2002	1.40%	11,566		12.456595		144,073	3.14%	7.78%

(Continued)

27

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
Fidelity® Variable Insurance Products Fund – Equity-Income Portfolio – Service Class
2006	1.40%	8,840	$	14.747337	$	130,366	3.33%	18.40%
2005	1.40%	7,136		12.455145		88,880	1.62%	4.28%
2004	1.40%	8,558		11.943782		102,215	1.38%	9.82%
2003	1.40%	7,960		10.875446		86,569	1.56%	28.40%
2002	1.40%	7,940		8.470071		67,252	1.68%	-18.16%
Fidelity® Variable Insurance Products Fund – Growth Portfolio – Service Class
2006	1.40%	16,960		8.771891		148,771	0.28%	5.24%
2005	1.40%	17,084		8.335000		142,395	0.40%	4.20%
2004	1.40%	19,908		7.999204		159,248	0.17%	1.82%
2003	1.40%	21,172		7.856387		166,335	0.19%	30.92%
2002	1.40%	21,165		6.000703		127,005	0.15%	-31.18%
Fidelity® Variable Insurance Products Fund – High Income Portfolio – Service Class
2006	1.40%	1,454		10.516122		15,290	13.85%	9.63%
2005	1.40%	682		9.592754		6,542	12.14%	1.09%
2004	1.40%	1,494		9.489161		14,177	12.43%	7.94%
2003	1.40%	2,279		8.791518		20,036	3.12%	25.19%
2002	1.40%	1,450		7.022305		10,182	11.21%	2.17%
Fidelity® Variable Insurance Products Fund – Overseas Portfolio – Service Class
2006	1.40%	4,882		12.981333		63,375	0.79%	16.30%
2005	1.40%	3,604		11.161905		40,228	0.58%	17.31%
2004	1.40%	4,418		9.514784		42,036	0.91%	11.90%
2003	1.40%	3,462		8.502985		29,437	0.75%	41.20%
2002	1.40%	3,686		6.021853		22,197	0.68%	-21.46%
Fidelity® Variable Insurance Products Fund II – Contrafund® Portfolio – Service Class
2006	1.40%	10,170		15.242016		155,011	1.12%	10.03%
2005	1.40%	11,450		13.852399		158,610	0.19%	15.22%
2004	1.40%	9,550		12.022889		114,819	0.24%	13.73%
2003	1.40%	8,790		10.571894		92,927	0.36%	26.56%
2002	1.40%	9,529		8.353442		79,600	0.75%	-10.69%
Fidelity® Variable Insurance Products Fund III – Growth Opportunities Portfolio – Service Class
2006	1.40%	2,144		8.470207		18,160	0.60%	3.83%
2005	1.40%	2,144		8.157700		17,490	0.82%	7.34%
2004	1.40%	3,660		7.599714		27,815	0.47%	5.56%
2003	1.40%	3,660		7.199376		26,350	0.63%	27.85%
2002	1.40%	3,807		5.631197		21,438	0.90%	-23.01%
Fidelity® Variable Insurance Products Fund III – Value Strategies Portfolio – Service Class
2006	1.40%	508		15.078159		7,660	0.45%	14.59%
2005	1.40%	508		13.158776		6,685	0.00%	1.13%
2004	1.40%	678		13.011385		8,822	0.00%	12.40%
2003	1.40%	677		11.575660		7,837	0.00%	55.60%
Gartmore GVIT – Emerging Markets Fund – Class I
2006	1.40%	2,494		23.205358		57,874	0.69%	34.81%
2005	1.40%	2,588		17.213353		44,548	0.62%	30.79%
2004	1.40%	1,542		13.161389		20,295	0.85%	19.05%
2003	1.40%	2,496		11.054993		27,593	0.61%	62.95%
2002	1.40%	2,130		6.784099		14,450	0.22%	-16.42%
Gartmore GVIT – Federated GGVIT High Income Bond Fund – Class I
2006	1.40%	2,224		13.973939		31,078	7.31%	9.06%
2005	1.40%	2,390		12.813161		30,623	8.15%	0.95%
2004	1.40%	1,494		12.692461		18,963	7.35%	8.56%
2003	1.40%	1,776		11.692144		20,765	7.51%	20.56%
2002	1.40%	1,751		9.698125		16,981	8.97%	1.78%
Gartmore GVIT – Global Health Sciences Fund – Class I
2006	1.40%	214		12.829766		2,746	0.00%	1.28%
2005	1.40%	512		12.667193		6,486	0.00%	6.94%
2004	1.40%	484		11.845553		5,733	0.00%	6.36%
2003	1.40%	179		11.137212		1,994	0.00%	34.80%
2002	1.40%	441		8.262252		3,644	0.00%	-17.38%

(Continued)

28

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
Gartmore GVIT – Global Technology and Communications Fund – Class I
2006	1.40%	944	$	3.234018	$	3,053	0.00%	9.62%
2005	1.40%	944		2.950302		2,785	0.00%	-1.91%
2004	1.40%	944		3.007625		2,839	0.00%	2.85%
2003	1.40%	12,962		2.924207		37,904	0.00%	53.06%
2002	1.40%	1,514		1.910471		2,892	0.67%	-43.58%
Gartmore GVIT – Global Utilities Fund – Class I
2006	1.40%	326		19.195121		6,258	2.15%	35.66%
2005	1.40%	516		14.149889		7,301	1.93%	4.91%
Gartmore GVIT – Government Bond Fund – Class I
2006	1.40%	7,114		13.552851		96,415	4.21%	1.90%
2005	1.40%	6,532		13.300351		86,878	3.76%	1.82%
2004	1.40%	6,538		13.062379		85,402	5.18%	1.82%
2003	1.40%	8,264		12.829335		106,022	3.31%	0.57%
2002	1.40%	21,004		12.756340		267,934	4.41%	9.43%
Gartmore GVIT – Growth Fund: Class I
2006	1.40%	7,740		5.784631		44,773	0.06%	4.69%
2005	1.40%	6,428		5.525723		35,519	0.08%	5.01%
2004	1.40%	6,428		5.261896		33,823	0.30%	6.64%
2003	1.40%	7,562		4.934135		37,312	0.02%	30.88%
2002	1.40%	10,487		3.769867		39,535	0.00%	-29.72%
Gartmore GVIT – International Growth Fund – Class I
2006	1.40%	3,354		12.299092		41,251	1.11%	31.11%
2005	1.40%	1,072		9.380789		10,056	0.77%	28.39%
2003	1.40%	329		6.489005		2,135	0.00%	33.73%
Gartmore GVIT – J.P. Morgan GVIT Balanced Fund: Class I
2006	1.40%	5,400		11.352415		61,303	2.32%	10.68%
2005	1.40%	5,394		10.256808		55,325	1.95%	1.11%
2004	1.40%	6,450		10.144108		65,429	1.98%	6.97%
2003	1.40%	6,213		9.482905		58,917	1.77%	16.76%
2002	1.40%	6,348		8.121890		51,558	2.59%	-13.54%
Gartmore GVIT – Mid Cap Growth Fund – Class I
2006	1.40%	1,986		9.334386		18,538	0.00%	8.37%
2005	1.40%	2,012		8.613187		17,330	0.00%	8.21%
2004	1.40%	1,900		7.959694		15,123	0.00%	13.72%
2003	1.40%	1,932		6.999166		13,522	0.00%	38.18%
2002	1.40%	2,044		5.065409		10,354	0.00%	-37.90%
Gartmore GVIT – Mid Cap Index Fund – Class I
2006	1.40%	4,860		19.587192		95,194	1.14%	8.36%
2005	1.40%	4,862		18.076864		87,890	1.00%	10.53%
2004	1.40%	6,170		16.354103		100,905	0.57%	14.11%
2003	1.40%	4,717		14.331619		67,602	0.48%	32.77%
2002	1.40%	4,334		10.794460		46,783	0.36%	-16.49%
Gartmore GVIT – Money Market Fund – Class I
2006	1.40%	7,984		11.066601		88,356	4.41%	3.07%
2005	1.40%	11,904		10.736889		127,812	2.66%	1.23%
2004	1.40%	15,118		10.605947		160,341	0.75%	-0.60%
2003	1.40%	20,183		10.669965		215,352	0.63%	-0.78%
2002	1.40%	23,287		10.754184		250,433	1.12%	-0.21%
Gartmore GVIT – Nationwide® Fund – Class I
2006	1.40%	9,240		11.935388		110,283	1.09%	12.04%
2005	1.40%	9,236		10.652647		98,388	0.90%	5.94%
2004	1.40%	10,992		10.055179		110,527	1.27%	8.21%
2003	1.40%	11,821		9.291859		109,839	0.56%	25.73%
2002	1.40%	12,545		7.390371		92,712	0.87%	-18.51%
Gartmore GVIT – Nationwide® Leaders Fund – Class I
2003	1.40%	379		10.353389		3,924	0.06%	23.64%

(Continued)

29

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
Gartmore GVIT – Small Cap Growth Fund – Class I
2006	1.40%	1,354	$	12.654947	$	17,135	0.00%	1.77%
2005	1.40%	1,360		12.435369		16,912	0.00%	6.58%
2004	1.40%	2,538		11.667420		29,612	0.00%	11.83%
2003	1.40%	2,912		10.433337		30,382	0.00%	32.39%
2002	1.40%	2,912		7.880865		22,949	0.00%	-34.22%
Gartmore GVIT – Small Cap Value Fund – Class I
2006	1.40%	7,584		23.270462		176,483	0.45%	15.66%
2005	1.40%	7,546		20.120403		151,829	0.07%	1.63%
2004	1.40%	8,304		19.796908		164,394	0.00%	15.66%
2003	1.40%	12,754		17.116946		218,310	0.00%	54.66%
2002	1.40%	8,918		11.067332		98,698	0.01%	-28.18%
Gartmore GVIT – Small Company Fund – Class I
2006	1.40%	5,616		21.200579		119,062	0.09%	10.47%
2005	1.40%	6,670		19.190538		128,001	0.00%	10.75%
2004	1.40%	6,382		17.327879		110,587	0.00%	17.36%
2003	1.40%	6,118		14.765146		90,333	0.00%	39.04%
2002	1.40%	7,826		10.619233		83,106	0.00%	-18.49%
Gartmore GVIT – Turner GVIT Growth Focus Fund – Class I
2002	1.40%	516		2.141179		1,105	0.00%	-43.66%
Gartmore GVIT – U.S. Growth Leaders Fund – Class I
2006	1.40%	1,002		14.713301		14,743	0.32%	-1.67%
2005	1.40%	830		14.963360		12,420	0.00%	10.41%
2004	1.40%	1,452		13.552459		19,678	0.00%	10.85%
2003	1.40%	2,253		12.226343		27,546	0.00%	50.03%
Gartmore GVIT – Van Kampen GVIT Comstock Value Fund – Class I
2006	1.40%	4,760		11.324174		53,903	1.70%	14.29%
2005	1.40%	5,712		9.908509		56,597	1.67%	2.79%
2004	1.40%	3,900		9.639397		37,594	1.52%	15.85%
2003	1.40%	1,127		8.320258		9,377	1.32%	29.59%
2002	1.40%	1,127		6.420208		7,236	1.27%	-26.19%
Gartmore GVIT – Van Kampen GVIT Multi-Sector Bond Fund – Class I
2006	1.40%	6,288		13.961929		87,793	4.59%	3.37%
2005	1.40%	4,068		13.506165		54,943	4.10%	0.75%
2004	1.40%	1,714		13.405165		22,976	4.83%	5.04%
2003	1.40%	2,029		12.761661		25,893	5.41%	10.55%
2002	1.40%	2,053		11.544091		23,700	5.32%	5.71%
Gartmore GVIT – Worldwide Leaders Fund – Class I
2006	1.40%	3,434		12.960173		44,505	0.90%	24.12%
2005	1.40%	1,268		10.441294		13,240	0.78%	17.67%
2004	1.40%	724		8.873195		6,424	0.00%	14.05%
2003	1.40%	724		7.780309		5,633	0.00%	34.16%
2002	1.40%	863		5.799437		5,005	1.20%	-26.44%
Nationwide® GVIT Strategic Value Fund – Class I
2003	1.40%	377		11.012816		4,152	0.04%	36.87%
2002	1.40%	377		8.046365		3,033	0.03%	-26.41%
Janus Aspen Series – Forty Portfolio – Service Shares
2006	1.40%	23,314		8.558108		199,524	0.14%	7.60%
2005	1.40%	23,350		7.953387		185,712	0.01%	11.00%
2004	1.40%	24,508		7.165447		175,611	0.02%	16.33%
2003	1.40%	26,317		6.159668		162,104	0.24%	18.56%
2002	1.40%	27,048		5.195269		140,522	0.31%	-17.10%
Janus Aspen Series – Global Technology Portfolio – Service Shares
2006	1.40%	9,296		3.919155		36,432	0.00%	6.33%
2005	1.40%	9,378		3.685735		34,565	0.00%	10.00%
2004	1.40%	11,626		3.350546		38,953	0.00%	-0.83%
2003	1.40%	13,356		3.378652		45,125	0.00%	44.44%
2002	1.40%	23,431		2.339124		54,808	0.00%	-41.75%

(Continued)

30

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
Janus Aspen Series – International Growth Portfolio – Service Shares
2006	1.40%	11,676	$	13.186665	$	153,968	1.83%	44.60%
2005	1.40%	13,104		9.119582		119,503	1.10%	30.11%
2004	1.40%	11,970		7.009034		83,898	0.83%	17.04%
2003	1.40%	13,563		5.988741		81,225	0.99%	32.66%
2002	1.40%	14,399		4.514191		65,000	0.65%	-26.79%
Neuberger Berman Advisers Management Trust – Guardian Portfolio – I Class Shares
2006	1.40%	648		14.457195		9,368	0.68%	11.79%
2005	1.40%	648		12.931987		8,380	0.15%	6.88%
2004	1.40%	648		12.099735		7,841	0.13%	14.19%
2003	1.40%	648		10.595804		6,866	0.71%	29.92%
2002	1.40%	942		8.155738		7,683	0.79%	-27.48%
Neuberger Berman Advisers Management Trust – Mid Cap Growth Portfolio – I Class Shares
2006	1.40%	4,342		12.872160		55,891	0.00%	13.09%
2005	1.40%	4,544		11.381961		51,720	0.00%	12.15%
2004	1.40%	5,436		10.148514		55,167	0.00%	14.68%
2003	1.40%	6,039		8.849433		53,442	0.00%	26.28%
2002	1.40%	6,789		7.007798		47,576	0.00%	-30.33%
Neuberger Berman Advisers Management Trust – Partners Portfolio® – Class I
2006	1.40%	2,132		15.616140		33,294	0.48%	10.67%
2005	1.40%	5,338		14.110055		75,319	1.11%	16.40%
2004	1.40%	3,574		12.122204		43,325	0.01%	17.31%
2003	1.40%	1,557		10.333462		16,089	0.00%	33.20%
2002	1.40%	1,350		7.757913		10,473	0.57%	-25.21%
Oppenheimer Variable Account Funds – Capital Appreciation Fund/VA – Non-Service Shares
2006	1.40%	12,054		11.805876		142,308	0.37%	6.44%
2005	1.40%	12,090		11.091470		134,096	0.89%	3.63%
2004	1.40%	11,544		10.702809		123,553	0.32%	5.44%
2003	1.40%	9,442		10.150676		95,843	0.46%	29.11%
2002	1.40%	13,977		7.861902		109,886	0.60%	-27.88%
Oppenheimer Variable Account Funds – Global Securities Fund/VA – Non-Service Shares
2006	1.40%	8,260		13.721463		113,339	0.99%	16.05%
2005	1.40%	8,044		11.823860		95,111	1.02%	12.71%
2004	1.40%	7,178		10.490302		75,299	1.27%	17.50%
2003	1.40%	7,446		8.928255		66,480	0.68%	41.02%
2002	1.40%	6,802		6.331165		43,065	0.57%	-23.23%
Oppenheimer Variable Account Funds – Main Street Fund®/VA – Initial Class
2006	1.40%	20,320		11.348679		230,605	1.10%	13.42%
2005	1.40%	20,618		10.005945		206,303	1.33%	4.50%
2004	1.40%	21,368		9.575362		204,606	0.82%	7.93%
2003	1.40%	22,174		8.872059		196,729	0.98%	24.95%
2002	1.40%	23,246		7.100693		165,063	0.76%	-19.94%
Oppenheimer Variable Account Funds – Oppenheimer Mid Cap Fund/VA – Non-Service Shares
2006	1.40%	6,562		10.082202		66,159	0.00%	1.52%
2005	1.40%	7,570		9.931444		75,181	0.00%	10.76%
2004	1.40%	8,638		8.966685		77,454	0.00%	18.10%
2003	1.40%	9,130		7.592423		69,319	0.00%	23.83%
2002	1.40%	13,157		6.131117		80,667	0.67%	-28.80%
Van Eck Worldwide Insurance Trust – Worldwide Emerging Markets Fund – Initial Class
2006	1.40%	292		28.027733		8,184	0.57%	37.55%
2005	1.40%	292		20.377122		5,950	0.91%	30.15%
2004	1.40%	322		15.656055		5,041	0.55%	24.13%
2003	1.40%	320		12.612719		4,036	0.07%	52.03%
2002	1.40%	172		8.296039		1,427	0.18%	-4.26%
Van Eck Worldwide Insurance Trust – Worldwide Hard Assets Fund – Initial Class
2006	1.40%	1,114		30.765179		34,272	0.05%	22.75%
2005	1.40%	810		25.062407		20,301	0.31%	49.56%
2004	1.40%	772		16.757883		12,937	0.21%	22.49%
2003	1.40%	383		13.708625		5,250	0.82%	43.05%
2002	1.40%	4,018		9.583147		38,505	0.74%	-4.19%

(Continued)

31

NATIONWIDE VARIABLE ACCOUNT-10 (NOTES TO FINANCIAL STATEMENTS, Continued)

	Contract Expense Rate*	Units	Unit Fair Value		Contract Owners’ Equity		Investment Income     Ratio**	Total         Return***
Van Kampen – The Universal Institutional Funds, Inc. – Emerging Markets Debt Portfolio – Class I
2005	1.40%	126	$	22.014894	$	2,774	0.00%	10.68%
2003	1.40%	188		18.328077		3,446	0.00%	26.08%
Van Kampen – The Universal Institutional Funds, Inc. – Mid Cap Growth Portfolio – Class I
2006	1.40%	394		8.524521		3,359	0.00%	7.75%
2005	1.40%	380		7.911472		3,006	0.00%	15.93%
2004	1.40%	416		6.824496		2,839	0.00%	19.89%
Van Kampen – The Universal Institutional Funds, Inc. – U.S. Real Estate Portfolio – Class I
2006	1.40%	2,590		37.611460		97,414	1.15%	36.12%
2005	1.40%	2,730		27.631171		75,433	0.87%	15.42%
2004	1.40%	6,456		23.940083		154,557	1.69%	34.49%
2003	1.40%	5,088		17.801092		90,572	0.00%	35.59%
2002	1.40%	5,607		13.128753		73,613	4.62%	-2.18%
Wells Fargo Advantage Variable Trust FundsSM – Wells Fargo Advantage VT Opportunity Fund
2006	1.40%	7,818		12.425003		97,139	0.00%	10.65%
2005	1.40%	7,880		11.228889		88,484	0.00%	6.38%
2004	1.40%	9,750		10.555564		102,917	0.00%	16.57%
2003	1.40%	9,038		9.055451		81,843	0.08%	35.09%
2002	1.40%	9,051		6.703248		60,671	0.37%	-27.84%
Fidelity® Variable Insurance Products Fund III – Value Strategies Portfolio – Service Class
2006	1.45%	110		15.043037		1,655	0.45%	14.53%
Contract Owners’ Equity Total By Year
2006					$	3,679,671
2005					$	3,320,112
2004					$	3,291,752
2003					$	3,093,116
2002					$	2,940,894

*	This represents the annual contract expense rate of the variable account for the period indicated and includes only those expenses that are assessed through a reduction in the unit values. Excluded are expenses of the underlying mutual funds and charges made directly to contract owner accounts through the redemption of units.
**	This represents the dividends for the period indicated, excluding distributions of capital gains, received by the subaccount from the underlying mutual fund, net of management fees assessed by the fund manager, divided by average net assets. The ratios exclude those expenses, if any, that result in direct reductions to the contractholder accounts either through reductions in unit values or redemption of units. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccounts invest.
***	This represents the total return for the period indicated, including changes in the value of the underlying mutual fund, which reflects the reduction of unit value for expenses assessed. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Investment options with a date notation indicate the effective date of that investment option in the Account. The total return is calculated for the period indicated or from the effective date through the end of the period.

32

Report of Independent Registered Public Accounting Firm

The Board of Directors of Nationwide Life Insurance Company and

    Contract Owners of Nationwide Variable Account-10:

We have audited the accompanying statement of assets, liabilities and contract owners’ equity of Nationwide Variable Account-10 (comprised of the sub-accounts listed in note 1(b) (collectively, “the Accounts”)) as of December 31, 2006, and the related statements of operations and changes in contract owners’ equity, and the financial highlights for the periods indicated herein. These financial statements and financial highlights are the responsibility of the Accounts’ 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 audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2006, by correspondence with the transfer agents of the underlying mutual funds. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Accounts as of December 31, 2006, and the results of their operations, changes in contract owners’ equity, and financial highlights for each of the periods indicated herein, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Columbus, Ohio

March 9, 2007

33

NATIONWIDE LIFE INSURANCE COMPANY	PRSRT STD
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