The Prudential Series Fund

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Pruco Life Insurance Company Notes to Consolidated Financial Statements 13. RELATED PARTY TRANSACTIONS (continued) agreement was amended effective August 1, 2007 to include the reinsurance of business sold prior to May 6, 2005 that was previously reinsured to Prudential Insurance. Taiwan branch reinsurance agreement On January 31, 2001, the Company transferred all of its assets and liabilities associated with the Company’s Taiwan branch including Taiwan’s insurance book of business to an affiliated Company, Prudential Life Insurance Company of Taiwan Inc. (―Prudential of Taiwan‖), a wholly owned subsidiary of Prudential Financial. The mechanism used to transfer this block of business in Taiwan is referred to as a ―full acquisition and assumption‖ transaction. Under this mechanism, the Company is jointly liable with Prudential of Taiwan for two years from the giving of notice to all obligees for all matured obligations and for two years after the maturity date of not-yet-matured obligations. Prudential of Taiwan is also contractually liable, under indemnification provisions of the transaction, for any liabilities that may be asserted against the Company. The transfer of the insurance related assets and liabilities was accounted for as a long-duration coinsurance transaction under accounting principles generally accepted in the United States. Under this accounting treatment, the insurance related liabilities remain on the books of the Company and an offsetting reinsurance recoverables is established. Affiliated premiums ceded for the periods ended December 31, 2008, 2007 and 2006 from the Taiwan coinsurance agreement were $77 million, $82 million and $84 million, respectively. Affiliated benefits ceded for the periods ended December 31, 2008, 2007 and 2006 from the Taiwan coinsurance agreement were $21 million, $17 million and $15 million, respectively. Reinsurance recoverables related to the Taiwan coinsurance agreement of $701 million and $650 million at December 31, 2008 and December 31, 2007, respectively. Purchase of fixed maturities from an affiliate During 2007, the Company purchased fixed maturities securities from an affiliated company, Commerce Street. The investments included collateralized mortgage backed securities. These securities were recorded at an amortized cost of $136 million and a fair value of $135 million. The net difference between historic amortized cost and the fair value, net of taxes was $1 million. During 2007, the Company purchased fixed maturities securities from Prudential Insurance. The investments included public and private placement bonds. These securities were recorded at an amortized cost of $64 million and a fair value of $64 million. The net difference between historic amortized cost and the fair value, net of taxes was less than $1 million. During 2006 the Company transferred fixed maturities securities, from the Company to an affiliate. The investments included public and private high yield bonds, private placement bonds, and mortgage loans. These securities were recorded at an amortized cost of $151 million and a fair value of $150 million. The net difference between historic amortized cost and the fair value, net of taxes was less than $1 million. Debt Agreements The Company has an agreement with Prudential Funding, LLC, a wholly owned subsidiary of Prudential Insurance which allows it to borrow funds for working capital and liquidity needs. The borrowings under this agreement are limited to $600 million. There was less than $1 million of debt outstanding to Prudential Funding, LLC as of December 31, 2008 as compared to $56 million at December 31, 2007. Interest expense related to this agreement was $0.6 million in 2008 and 2007. The related interest was charged at a variable rate ranging from .31% to 4.31% for 2008 and 4.26% to 5.86% for 2007. B-40
Pruco Life Insurance Company Notes to Consolidated Financial Statements 14. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The unaudited quarterly results of operations for the years ended December 31, 2008 and 2007 are summarized in the table below: Three months ended (in thousands) March 31 June 30 September 30 December 31 2008 Total revenues $ 259,712 $ 285,789 $ 234,086 $ 606,999 Total benefits and expenses 210,453 212,439 237,546 411,819 Income/(Loss) from operations before income taxes 49,259 73,350 (3,460) 195,180 Net income $ 40,914 $ 64,659 $ 15,560 $ 128,192 2007 Total revenues $ 276,384 $ 272,384 $ 322,648 $ 288,608 Total benefits and expenses 207,972 203,941 221,058 215,307 Income from operations before income taxes 68,412 68,443 101,590 73,301 Net income $ 56,027 $ 50,163 $ 85,914 $ 55,230 B-41
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MAY 1, 2009 PROSPECTUS The Prudenti
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THE PRUDENTIAL SERIES FUND Diversif
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THE PRUDENTIAL SERIES FUND Natural
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This prospectus discusses the follo
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INTRODUCTION ABOUT THE FUND AND ITS
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■ prepayment risk The Portfolio i
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■ ■ ■ ■ ■ ■ ■ ■ ■
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a representative sample of the stoc
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PRINCIPAL RISKS Although we try to
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Foreign investment risk. Investing
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Market risk. Market risk is the ris
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guaranteeing the obligation for ult
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PAST PERFORMANCE Conservative Balan
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Equity Portfolio Annual Returns (Cl
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Global Portfolio Annual Returns (Cl
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High Yield Bond Portfolio Annual Re
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Money Market Portfolio Annual Retur
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Small Capitalization Stock Portfoli
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Value Portfolio Annual Returns (Cla
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EXAMPLE The following Example, whic
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and are considered speculative. We
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can’t guarantee success, and it i
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■ ■ Repurchase agreements. The
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Government Income Portfolio The inv
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The Portfolio may also invest in ob
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unrated, of comparable quality in o
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■ Illiquid securities The Portfol
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MORE DETAILED INFORMATION ABOUT OTH
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are not backed by the full faith an
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HOW THE FUND IS MANAGED BOARD OF TR
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trading, asset management and priva
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Equity Portfolio Spiros “Sig” S
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Richard Piccirillo is Principal and
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Natural Resources Portfolio David A
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HOW TO BUY AND SELL SHARES OF THE P
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(which is generally 4:00 p.m. New Y
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DISTRIBUTOR Prudential Investment M
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FINANCIAL HIGHLIGHTS INTRODUCTION T
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Equity Portfolio Class I Year Ended
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High Yield Bond Portfolio Year Ende
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Small Capitalization Stock Portfoli
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INVESTOR INFORMATION SERVICES: Shar
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TABLE OF CONTENTS Page PER SHARE IN
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PER SHARE INVESTMENT INCOME, CAPITA
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Summary of Charges The Partnership
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Partnership. PREI's investment staf
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would be willing to commit to a fir
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The investment manager will manage
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4. Risks with Sale-Leaseback Transa
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If an account which has been alloca
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correspondingly adjusted. In additi
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RESTRICTIONS ON CONTRACT OWNERS’
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During the year ended December 31,
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(2) Net investment income for the y
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The following sections discuss thos
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The table below presents the amount
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NOTES TO THE FINANCIAL STATEMENTS O
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THE PRUDENTIAL VARIABLE CONTRACT RE
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NOTES TO THE CONSOLIDATED FINANCIAL
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Page 145 and 146: Pruco Life Insurance Company Notes
Page 179: Pruco Life Insurance Company Notes
Page 185 and 186: Many Prudential Financial companies
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The Prudential Series Fund

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