SEMIANNUAL REPORT June 30, 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
Please remember that you may not buy (nor will you own) shares of the Fund directly. The Fund is available through variable annuity contracts and variable life insurance policies offered by the separate accounts of participating insurance companies as well as qualified pension and retirement plans. Please contact your financial advisor or insurance representative for more information.
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
TABLE OF CONTENTS Performance Overview.............................................................2 Portfolio Overview ...................................................................3 Understanding Your Fund’s Expenses .......................................4 Portfolio of Investments ..........................................................5 Statement of Assets and Liabilities ........................................11 Statement of Operations .......................................................13 Statement of Changes in Net Assets......................................14 Financial Highlights ...............................................................16 Notes to Financial Statements...............................................18 Board Consideration and Approval of Management Agreement .......................................................24 Important Information About This Report ................................29
The views expressed in this report reflect the current views of the respective parties. These views are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict, so actual outcomes and results may differ significantly from the views expressed. These views are subject to change at any time based upon economic, market or other conditions and the respective parties disclaim any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Columbia fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any particular Columbia fund. References to specific securities should not be construed as a recommendation or investment advice. Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PERFORMANCE OVERVIEW (Unaudited)
Performance Summary n
Columbia Variable Portfolio — Small Cap Value Fund (the Fund) Class 2 shares returned 4.39% for the six-month period that ended June 30, 2016.
n
The Fund underperformed its benchmark, the Russell 2000 Value Index, which returned 6.08% for the same time period.
Average Annual Total Returns (%) (for period ended June 30, 2016) Inception
6 Months Cumulative
1 Year
5 Years
10 Years
Class 1
05/19/98
4.49
-4.44
6.63
5.68
Class 2
06/01/00
4.39
-4.65
6.43
5.49
6.08
-2.58
8.15
5.15
Russell 2000 Value Index
Performance data quoted represents past performance and current performance may be lower or higher. Past performance is no guarantee of future results. The investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than the original cost. For current month-end performance information, please contact your financial advisor or insurance representative. Performance results reflect the effect of any fee waivers or reimbursements of fund expenses by Columbia Management Investment Advisers, LLC and/or any of its affiliates. Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower. Investment earnings, if any, are tax-deferred until distributed to shareholders, at which time taxes may become due. Total return performance includes changes in share price and assumes reinvestment of dividends and capital gains, if any. Performance results reflect the effect of all fund expenses, but do not include any fees and expenses imposed under your variable annuity contract and/or variable life insurance policy or qualified pension or retirement plan. If performance results included the effect of these additional charges, they would be lower. The Russell 2000 Value Index, an unmanaged index, tracks the performance of those Russell 2000 Index companies with lower price-to-book ratios and lower forecasted growth values. Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
2
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OVERVIEW (Unaudited) Portfolio Management
Top Ten Holdings (%) (at June 30, 2016)
Jeremy Javidi, CFA
Fresh Del Monte Produce, Inc.
1.2
Sunstone Hotel Investors, Inc.
1.2
Radian Group, Inc.
1.2
LaSalle Hotel Properties
1.1
Mantech International Corp., Class A
1.1
Investors Bancorp, Inc.
1.1
MGIC Investment Corp.
1.1
First Citizens BancShares Inc., Class A
1.1
Chesapeake Lodging Trust
1.0
Mueller Industries, Inc.
1.0
Percentages indicated are based upon total investments (excluding Money Market Funds). For further detail about these holdings, please refer to the section entitled “Portfolio of Investments.” Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security. Portfolio Breakdown (%) (at June 30, 2016) Common Stocks Money Market Funds Total
98.5 1.5 100.0
Percentages indicated are based upon total investments. The Fund’s portfolio composition is subject to change. Equity Sector Breakdown (%) (at June 30, 2016) Consumer Discretionary Consumer Staples Energy Financials
10.4 2.6 7.2 42.6
Health Care
4.2
Industrials
12.9
Information Technology
13.5
Materials
4.6
Telecommunication Services
0.6
Utilities
1.4
Total
100.0
Percentages indicated are based upon total equity investments. The Fund’s portfolio composition is subject to change.
Semiannual Report 2016
3
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
UNDERSTANDING YOUR FUND’S EXPENSES (Unaudited) As an investor, you incur ongoing costs, which generally include management fees, distribution and/or service fees, and other fund expenses. The following information is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to help you compare these costs with the ongoing costs of investing in other mutual funds. The information below does not reflect fees and expenses imposed under your variable annuity contract and/or variable life insurance policy (collectively, Contracts) or qualified pension and retirement plan (Qualified Plan), if any. The total fees and expenses you bear may therefore be higher than those shown below.
Analyzing Your Fund’s Expenses To illustrate these ongoing costs, we have provided examples and calculated the expenses paid by investors in each share class of the Fund during the period. The actual and hypothetical information in the table is based on an initial investment of $1,000 at the beginning of the period indicated and held for the entire period. Expense information is calculated two ways and each method provides you with different information. The amount listed in the “Actual” column is calculated using the Fund’s actual operating expenses and total return for the period. You may use the Actual information, together with the amount invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the results by the expenses paid during the period under the “Actual” column. The amount listed in the “Hypothetical” column assumes a 5% annual rate of return before expenses (which is not the Fund’s actual return) and then applies the Fund’s actual expense ratio for the period to the hypothetical return. You should not use the hypothetical account values and expenses to estimate either your actual account balance at the end of the period or the expenses you paid during the period. See “Compare With Other Funds” below for details on how to use the hypothetical data.
Compare With Other Funds Since all mutual funds are required to include the same hypothetical calculations about expenses in shareholder reports, you can use this information to compare the ongoing cost of investing in the Fund with other funds. To do so, compare the hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. As you compare hypothetical examples of other funds, it is important to note that hypothetical examples are meant to highlight the ongoing costs of investing in a fund only and do not reflect any transaction costs, such as redemption or exchange fees, or expenses that apply to the subaccount or the Contract. Therefore, the hypothetical calculations are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. If the fees and expenses imposed under your Contract or Qualified Plan, if any, were included, your costs would be higher.
January 1, 2016 – June 30, 2016 Account Value at the Beginning of the Period ($)
Account Value at the End of the Period ($)
Expenses Paid During the Period ($)
Fund’s Annualized Expense Ratio (%)
Actual
Hypothetical
Actual
Hypothetical
Actual
Hypothetical
Actual
Class 1
1,000.00
1,000.00
1,044.90
1,020.24
4.73
4.67
0.93
Class 2
1,000.00
1,000.00
1,043.90
1,019.00
6.00
5.92
1.18
Expenses paid during the period are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period and then multiplied by the number of days in the Fund’s most recent fiscal half year and divided by 366. Expenses do not include fees and expenses incurred indirectly by the Fund from its investment in underlying funds, including affiliated and non-affiliated pooled investment vehicles, such as mutual funds and exchange-traded funds. Had Columbia Management Investment Advisers, LLC and/or certain of its affiliates not waived/reimbursed certain fees and expenses, account value at the end of the period would have been reduced.
4
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS June 30, 2016 (Unaudited) (Percentages represent value of investments compared to net assets)
Common Stocks 98.0% Issuer
Common Stocks Shares
Value ($)
(continued)
Issuer
Shares
CONSUMER DISCRETIONARY 10.2%
Steven Madden Ltd.(a)
35,448
Auto Components 2.4%
Total
Cooper Tire & Rubber Co.
82,074
2,447,447
Gentherm, Inc.(a)
42,789
1,465,523
186,740
1,643,312
54,219
2,527,147
Modine Manufacturing Co.(a) Tenneco, Inc.(a) Total
8,083,429 68,899
1,579,165
Diversified Consumer Services 0.3% K12, Inc.(a)
87,155
1,088,566
207,706
324,021
52,320
1,103,952
Hotels, Restaurants & Leisure 0.4% Ignite Restaurant Group, Inc.(a) Marcus Corp. (The)
1,211,613 2,648,290
Total Consumer Discretionary
33,978,602
CONSUMER STAPLES 2.5% Food & Staples Retailing 0.7% Andersons, Inc. (The)
67,495
2,398,772
Fresh Del Monte Produce, Inc.
73,839
4,019,057
John B. Sanfilippo & Son, Inc.
13,875
Food Products 1.4%
Automobiles 0.5% Winnebago Industries, Inc.
Value ($)
Total
1,427,973
Household Durables 2.3%
Total
591,491 4,610,548
Personal Products 0.4% Inter Parfums, Inc.
47,422
Total Consumer Staples
1,354,847 8,364,167
ENERGY 7.0% Energy Equipment & Services 1.5%
Cavco Industries, Inc.(a)
18,427
1,726,610
Aspen Aerogels, Inc.(a)
269,374
Ethan Allen Interiors, Inc.
62,280
2,057,731
CARBO Ceramics, Inc.
66,030
864,993
Hooker Furniture Corp.
48,443
1,041,040
Dawson Geophysical Co.(a)
126,967
1,034,781
Lifetime Brands, Inc.
64,277
937,802
215,798
UCP, Inc., Class A
(a)
Total
Geospace Technologies Corp.(a)
51,577
844,315
1,730,700
Natural Gas Services Group, Inc.(a)
46,860
1,073,094
7,493,883
Total
Leisure Products 0.7% Johnson Outdoors, Inc., Class A Malibu Boats, Inc., Class A(a)
1,338,789
5,155,972
Oil, Gas & Consumable Fuels 5.5% 41,562
1,068,144
Alon USA Energy, Inc.
275,348
1,784,255
104,366
1,260,741
Callon Petroleum Co.(a)
182,798
2,052,822
2,328,885
Cobalt International Energy, Inc.(a)
Total Media 1.4%
528,766
708,547
Contango Oil & Gas Co.(a)
71,023
869,322
CVR Energy, Inc.
42,200
654,100
AMC Entertainment Holdings, Inc., Class A
98,337
2,715,084
Lions Gate Entertainment Corp.
99,160
2,006,007
Earthstone Energy, Inc.
80,595
868,814
4,721,091
Eclipse Resources Corp.(a)
340,363
1,136,812
Jones Energy, Inc., Class A(a)
276,349
1,138,558
Total Specialty Retail 1.4% Aaron’s, Inc.
86,258
1,888,187
Citi Trends, Inc.
48,071
746,543
DSW, Inc., Class A
57,500
1,217,850
Outerwall, Inc.
17,970
754,740
Total
4,607,320
Peabody Energy Corp.(a) Rice Energy, Inc.(a) Sanchez Energy Corp.(a) SM Energy Co. Synergy Resources Corp.(a) Whiting Petroleum Corp.
Textiles, Apparel & Luxury Goods 0.8% Deckers Outdoor Corp.(a)
(a)
24,977
1,436,677
WPX Energy, Inc.(a)
(a)
1
1
98,410
2,168,956
147,150
1,038,879
37,280
1,006,560
256,189
1,706,219
108,700
1,006,562
228,010
2,122,773
Total
18,263,180
Total Energy
23,419,152
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
5
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (continued) June 30, 2016 (Unaudited)
Common Stocks
Common Stocks
(continued)
Issuer
Shares
Value ($)
(continued)
Issuer
FINANCIALS 41.8%
Insurance 6.9%
Banks 18.5%
American Equity Investment Life Holding Co.
BancFirst Corp.
40,922
BankUnited, Inc. Banner Corp. Boston Private Financial Holdings, Inc. Bridge Bancorp, Inc. Brookline Bancorp, Inc.
2,468,415
104,283
3,203,574
59,300
2,522,622
205,010
2,415,018
33,340
946,856
163,631
1,804,850
Capital City Bank Group, Inc.
122,573
1,706,216
Cascade Bancorp
252,423
1,398,424
Centerstate Banks, Inc.
144,403
2,274,347
(a)
Columbia Banking System, Inc.
88,289
2,477,389
Community Trust Bancorp, Inc.
40,627
1,408,132
FCB Financial Holdings, Inc., Class A(a)
79,249
2,694,466
First Citizens BancShares Inc., Class A
13,518
3,499,945
First Financial Corp.
67,689
2,478,771
First NBC Bank Holding Co.(a)
91,560
1,537,292
First of Long Island Corp. (The)
46,700
1,338,889
Heritage Financial Corp.
44,396
780,482
Investors Bancorp, Inc. Merchants Bancshares, Inc. National Bank Holdings Corp., Class A
319,354
3,538,442
58,829
1,793,108
144,515
2,942,325
Northrim BanCorp, Inc.
73,658
1,936,469
Sierra Bancorp
37,771
630,398
Synovus Financial Corp.
84,400
2,446,756
Towne Bank
113,366
2,454,374
Trustmark Corp.
123,822
3,076,977
UMB Financial Corp.
58,300
3,102,143
Union Bankshares Corp.
74,930
1,851,520
Webster Financial Corp.
84,950
2,884,053
Total
61,612,253
Capital Markets 0.6% INTL FCStone, Inc.(a)
70,095
1,912,892
Consumer Finance 1.0% Cash America International, Inc. Enova International, Inc.(a)
66,113 86,437
Total
2,817,736 636,176 3,453,912
Pico Holdings, Inc.(a)
131,456
1,243,574
167,150
2,381,888
51,431
2,669,300
Baldwin & Lyons, Inc., Class B
58,586
1,444,731
EMC Insurance Group, Inc.
55,202
1,530,199
Employers Holdings, Inc.
71,765
2,082,620
FBL Financial Group, Inc., Class A
39,129
2,373,956
Heritage Insurance Holdings, Inc.
164,390
1,967,748
Horace Mann Educators Corp.
52,161
1,762,520
National Western Life Group, Inc., Class A
10,706
2,090,561
Navigators Group, Inc. (The)
25,380
2,334,199
United Fire Group, Inc.
50,230
2,131,259
Total
Semiannual Report 2016
22,768,981
Real Estate Investment Trusts (REITs) 8.9% Altisource Residential Corp.
136,492
1,254,362
Chesapeake Lodging Trust
142,793
3,319,937
Cousins Properties, Inc.
278,061
2,891,834
EastGroup Properties, Inc.
42,229
2,910,423
Getty Realty Corp.
140,635
3,016,621
LaSalle Hotel Properties
151,870
3,581,095
Lexington Realty Trust
145,240
1,468,376
20,157
1,513,589
National Health Investors, Inc. Potlatch Corp.
60,647
2,068,063
Resource Capital Corp.
167,247
2,150,796
Sunstone Hotel Investors, Inc.
330,182
3,985,297
Terreno Realty Corp.
54,337
Total
1,405,698 29,566,091
Thrifts & Mortgage Finance 5.5% Chicopee Bancorp, Inc.
20,262
369,984
HomeStreet, Inc.(a)
145,645
2,901,248
MGIC Investment Corp.(a)
590,260
3,512,047
Provident Financial Holdings, Inc.
52,050
952,515
Radian Group, Inc.
370,510
3,860,714
Washington Federal, Inc.
128,895
3,126,993
Westfield Financial, Inc.
179,881
1,385,084
66,635
2,144,981
WSFS Financial Corp. Total Financials
The accompanying Notes to Financial Statements are an integral part of this statement.
6
Value ($)
Argo Group International Holdings Ltd.
Total
Diversified Financial Services 0.4%
Shares
18,253,566 138,811,269
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (continued) June 30, 2016 (Unaudited)
Common Stocks
Common Stocks
(continued)
Issuer
Shares
Issuer
Shares
Value ($)
HEALTH CARE 4.2%
Gorman-Rupp Co.
48,906
1,340,514
Biotechnology 1.7%
Hardinge, Inc.
59,170
595,250
ACADIA Pharmaceuticals, Inc.
(a)
Dynavax Technologies Corp.(a) Keryx Biopharmaceuticals, Inc.
(a)
PTC Therapeutics, Inc.(a)
Value ($)
(continued)
52,270
1,696,684
Kadant, Inc.
22,977
1,183,545
118,284
1,724,581
LB Foster Co., Class A
96,680
1,052,845
201,500
1,333,930
Lydall, Inc.
122,934
862,997
Total
5,618,192
Mueller Industries, Inc. Standex International Corp. Wabash National Corp.
(a)
Health Care Equipment & Supplies 0.3% Sientra, Inc.(a)
(a)
154,740
1,018,189
BioDelivery Sciences International, Inc.(a)
275,005
649,012
Flex Pharma, Inc.(a)
152,476
1,556,780
Westport Fuel Systems, Inc.(a)
47,048
1,814,171
101,428
3,233,525
25,640
2,118,633
131,440
1,669,288
1
1
Total
Pharmaceuticals 2.2%
20,291,336
Professional Services 1.2% FTI Consulting, Inc.(a)
60,090
(a)
2,444,461
46,156
1,556,842
TrueBlue, Inc.
Sagent Pharmaceuticals, Inc.(a)
93,330
1,398,083
Total
Supernus Pharmaceuticals, Inc.(a)
97,648
1,989,090
Road & Rail 0.8%
7,149,807
Landstar System, Inc.
16,794
1,153,076
Werner Enterprises, Inc.
59,278
1,361,616
Pacira Pharmaceuticals, Inc.
(a)
Total Total Health Care
13,786,188
85,703
Total INDUSTRIALS 12.6%
2,514,692
Trading Companies & Distributors 0.2%
Aerospace & Defense 0.3% Mercury Systems, Inc.(a)
1,621,501 4,065,962
Houston Wire & Cable Co.
125,526
39,900
991,914
Simpson Manufacturing Co., Inc.
66,680
2,665,199
INFORMATION TECHNOLOGY 13.2%
Universal Forest Products, Inc.
32,800
3,040,232
Communications Equipment 0.8%
5,705,431
Digi International, Inc.(a)
Total Industrials
659,011 41,822,824
Building Products 1.7%
Total
Plantronics, Inc.
Commercial Services & Supplies 0.9% Unifirst Corp.
26,593
3,077,342
67,110
723,446
General Cable Corp.
45,979 77,800
Total
1,714,097 988,838 2,702,935
Industrial Conglomerates 0.4% Raven Industries, Inc.
57,590
1,090,755
2,758,844
AVX Corp. (a)
2,477,209
94,970
2,008,616
Fitbit, Inc., Class A(a)
160,260
1,958,377
InvenSense, Inc.(a)
171,730
1,052,705
MTS Systems Corp.
27,279
1,195,911
Novanta, Inc.(a)
35,999
545,385
(a)
OSI Systems, Inc.
Albany International Corp., Class A
65,055
2,597,646
Internet Software & Services 0.6%
Altra Industrial Motion Corp.
81,017
2,185,839
WebMD Health Corp.(a)
112,378
1,208,064
IT Services 2.4%
29,106
1,292,015
Higher One Holdings, Inc.(a)
EnPro Industries, Inc.
182,416
51,640
Total
Machinery 6.1%
Dynamic Materials Corp.
1,549,680
Total
Benchmark Electronics, Inc.
Electrical Equipment 0.8% Encore Wire Corp.
1,209,164
35,220
Electronic Equipment, Instruments & Components 3.7%
Construction & Engineering 0.2% Northwest Pipe Co.(a)
112,690
3,001,833 12,240,036
32,797
1,905,834
269,826
1,378,811
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
7
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (continued) June 30, 2016 (Unaudited)
Common Stocks
Common Stocks
(continued)
Issuer
Shares
Lionbridge Technologies, Inc.(a)
Value ($)
(continued)
Issuer
295,112
1,165,692
TimkenSteel Corp.
Mantech International Corp., Class A
94,195
3,562,455
Universal Stainless & Alloy Products, Inc.(a)
TeleTech Holdings, Inc.
69,510
1,885,806
Total
7,992,764
Paper & Forest Products 0.4%
Total
Shares
Value ($)
148,180
1,425,492
82,130
Louisiana-Pacific Corp.(a)
Semiconductors & Semiconductor Equipment 3.8%
75,770
Cypress Semiconductor Corp.
253,760
2,677,168
Entegris, Inc.(a)
171,640
2,483,631
IXYS Corp.
148,001
1,517,010
31,803
1,048,863
magicJack VocalTec Ltd.(a)
60,790
2,962,904
Wireless Telecommunication Services 0.3%
342,432
2,030,622
Shenandoah Telecommunications Co.
Total Materials
1,314,609 14,882,606
TELECOMMUNICATION SERVICES 0.6% Diversified Telecommunication Services 0.3%
MACOM Technology Solutions Holdings, Inc.(a) (a)
Silicon Laboratories, Inc.
SunEdison Semiconductor Ltd.(a)
895,217 9,175,659
Total
12,720,198
145,660 29,404
Total Telecommunication Services
916,202 1,148,520 2,064,722
Software 1.5% Mentor Graphics Corp.
107,810
2,292,040
MicroStrategy, Inc., Class A(a)
7,580
1,326,652
Silver Spring Networks, Inc.(a)
114,078
1,386,048
Total
5,004,740 58,094
Total Information Technology
Electric Utilities 0.5% IDACORP, Inc.
1,329,772 43,952,188
19,750
1,606,662
38,601
3,038,285
Gas Utilities 0.9% Southwest Gas Corp.
Technology Hardware, Storage & Peripherals 0.4% Stratasys Ltd.(a)
UTILITIES 1.4%
Total Utilities
4,644,947
Total Common Stocks (Cost: $322,715,441)
325,726,665
MATERIALS 4.5% Chemicals 1.0%
Money Market Funds 1.5%
Flotek Industries, Inc.(a)
105,928
1,398,250
Tronox Ltd., Class A
422,732
1,864,248
Total
3,262,498
Containers & Packaging 0.3% Greif, Inc., Class A
Columbia Short-Term Cash Fund, 0.441%(b)(c) Total Money Market Funds (Cost: $4,977,498)
30,315
1,129,840
Allegheny Technologies, Inc.
110,230
1,405,432
Other Assets & Liabilities, Net
Commercial Metals Co.
161,170
2,723,773
Net Assets
Ferroglobe PLC
214,720
1,848,739
32,113
877,006
Metals & Mining 2.8%
Olympic Steel, Inc.
Total Investments (Cost: $327,692,939)
Notes to Portfolio of Investments (a) Non-income producing investment. (b) The rate shown is the seven-day current annualized yield at June 30, 2016.
The accompanying Notes to Financial Statements are an integral part of this statement.
8
Semiannual Report 2016
Shares
Value ($)
4,977,498
4,977,498 4,977,498 330,704,163 1,500,887 332,205,050
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (continued) June 30, 2016 (Unaudited)
Notes to Portfolio of Investments (continued) (c) As defined in the Investment Company Act of 1940, an affiliated company is one in which the Fund owns 5% or more of the company’s outstanding voting securities, or a company which is under common ownership or control with the Fund. Holdings and transactions in these affiliated companies during the period ended June 30, 2016 are as follows:
Issuer Columbia Short-Term Cash Fund
Beginning Cost ($)
Purchase Cost ($)
Proceeds From Sales ($)
Ending Cost ($)
Dividends — Affiliated Issuers ($)
Value ($)
8,915,326
53,777,333
(57,715,161)
4,977,498
9,919
4,977,498
Fair Value Measurements The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund’s assumptions about the information market participants would use in pricing an investment. An investment’s level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset’s or liability’s fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. Fair value inputs are summarized in the three broad levels listed below:
>
Level 1 — Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date (including NAV for open-end mutual funds). Valuation adjustments are not applied to Level 1 investments.
>
Level 2 — Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
>
Level 3 — Valuations based on significant unobservable inputs (including the Fund’s own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment’s fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy. Certain investments that have been measured at fair value using the net asset value per share (or its equivalent) are not categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to reconcile the fair value hierarchy to the amounts presented in the Portfolio of Investments. The Columbia Short-Term Cash Fund seeks to provide shareholders with maximum current income consistent with liquidity and stability of principal. Investments in Columbia Short-Term Cash Fund may be redeemed on a daily basis without restriction. Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data. Under the direction of the Fund’s Board of Trustees (the Board), the Investment Manager’s Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager’s organization, including operations and accounting, trading and investments, compliance, risk management and legal. The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
9
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS (continued) June 30, 2016 (Unaudited)
Fair Value Measurements
(continued)
members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier. For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed. The following table is a summary of the inputs used to value the Fund’s investments at June 30, 2016: Level 1 Quoted Prices in Active Markets for Identical Assets ($)
Level 2 Other Significant Observable Inputs ($)
Level 3 Significant Unobservable Inputs ($)
Total ($)
33,978,602
—
—
33,978,602
8,364,167
—
—
8,364,167
Investments Common Stocks Consumer Discretionary Consumer Staples Energy Financials
23,419,152
—
—
23,419,152
138,811,269
—
—
138,811,269
Health Care
13,786,188
—
—
13,786,188
Industrials
41,822,824
—
—
41,822,824
Information Technology
43,952,188
—
—
43,952,188
Materials
14,882,606
—
—
14,882,606
Telecommunication Services
2,064,722
—
—
2,064,722
Utilities
4,644,947
—
—
4,644,947
325,726,665
—
—
325,726,665
—
—
—
4,977,498
325,726,665
—
—
330,704,163
Total Common Stocks Investments measured at net asset value Money Market Funds Total Investments
See the Portfolio of Investments for all investment classifications not indicated in the table. There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of this statement.
10
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES June 30, 2016 (Unaudited)
Assets Investments, at value Unaffiliated issuers (identified cost $322,715,441) Affiliated issuers (identified cost $4,977,498) Total investments (identified cost $327,692,939)
$325,726,665 4,977,498 330,704,163
Receivable for: Investments sold Capital shares sold Dividends
1,828,745 15,773 584,247
Foreign tax reclaims Expense reimbursement due from Investment Manager Trustees’ deferred compensation plan Total assets
999 16,204 47,367 333,197,498
Liabilities Due to custodian
11,507
Payable for: Investments purchased
395,898
Capital shares purchased
141,992
Investment management fees
240,543
Distribution and/or service fees
67,926
Transfer agent fees
16,589
Compensation of board members
1,912
Chief compliance officer expenses Other expenses Trustees’ deferred compensation plan Total liabilities Net assets applicable to outstanding capital stock
42 68,672 47,367 992,448 $332,205,050
Represented by Paid-in capital Undistributed net investment income Accumulated net realized gain
$291,317,240 2,500,731 35,375,873
Unrealized appreciation (depreciation) on: Investments
3,011,224
Foreign currency translations Total — representing net assets applicable to outstanding capital stock
(18) $332,205,050
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
11
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES (continued) June 30, 2016 (Unaudited)
Class 1 Net assets Shares outstanding Net asset value per share
$5,710,263 341,023 $16.74
Class 2 Net assets Shares outstanding Net asset value per share
The accompanying Notes to Financial Statements are an integral part of this statement.
12
Semiannual Report 2016
$326,494,787 19,622,436 $16.64
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
STATEMENT OF OPERATIONS Six Months Ended June 30, 2016 (Unaudited)
Net investment income Income: Dividends — unaffiliated issuers Dividends — affiliated issuers Foreign taxes withheld Total income Expenses: Investment management fees Distribution and/or service fees Class 2 Transfer agent fees Class 1 Class 2 Compensation of board members Custodian fees Printing and postage fees Audit fees Legal fees Chief compliance officer expenses Other Total expenses Fees waived or expenses reimbursed by Investment Manager and its affiliates Total net expenses Net investment income Realized and unrealized gain (loss) — net Net realized gain (loss) on: Investments Net realized gain Net change in unrealized appreciation (depreciation) on: Investments Foreign currency translations Net change in unrealized appreciation Net realized and unrealized gain Net increase in net assets resulting from operations
$3,041,006 9,919 (2,187) 3,048,738 1,409,620 398,042 1,685 95,527 10,671 12,471 44,698 12,364 3,993 80 5,613 1,994,764 (89,875) 1,904,889 1,143,849
1,829,599 1,829,599 12,529,663 2 12,529,665 14,359,264 $15,503,113
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
13
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended June 30, 2016 (Unaudited)
Year Ended December 31, 2015
$1,143,849
$1,150,886
Operations Net investment income Net realized gain
1,829,599
34,035,482
Net change in unrealized appreciation (depreciation)
12,529,665
(56,973,737)
Net increase (decrease) in net assets resulting from operations
15,503,113
(21,787,369)
Distributions to shareholders Net investment income Class 1
—
(54,657)
Class 2
—
(1,997,714)
Net realized gains Class 1
—
(447,373)
Class 2
—
(23,054,939)
—
(25,554,683)
Total distributions to shareholders Decrease in net assets from capital stock activity
(9,527,585)
(2,465,863)
Total increase (decrease) in net assets
5,975,528
(49,807,915)
Net assets at beginning of period Net assets at end of period Undistributed net investment income
The accompanying Notes to Financial Statements are an integral part of this statement.
14
Semiannual Report 2016
326,229,522
376,037,437
$332,205,050
$326,229,522
$2,500,731
$1,356,882
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
STATEMENT OF CHANGES IN NET ASSETS (continued)
Six Months Ended June 30, 2016 (Unaudited) Shares
Dollars ($)
95,304 —
Redemptions
(131,647)
Net decrease
(36,343) 1,063,525 — (1,530,647)
Year Ended December 31, 2015 Shares
Dollars ($)
1,531,636
33,534
579,664
—
29,549
502,030
(2,129,766)
(80,443)
(1,417,603)
(598,130)
(17,360)
(335,909)
15,821,331
1,157,841
20,033,756
—
1,480,653
25,052,653
(24,750,786)
(2,665,425)
(47,216,363)
Capital stock activity Class 1 shares Subscriptions Distributions reinvested
Class 2 shares Subscriptions Distributions reinvested Redemptions Net decrease
(467,122)
(8,929,455)
(26,931)
(2,129,954)
Total net decrease
(503,465)
(9,527,585)
(44,291)
(2,465,863)
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
15
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS
The following tables are intended to help you understand the Fund’s financial performance. Certain information reflects financial results for a single share of a class held for the periods shown. Per share net investment income (loss) amounts are calculated based on average shares outstanding during the period. Total return assumes reinvestment of all dividends and distributions, if any. Total return does not reflect any fees and expenses imposed under your Contract and/or Qualified Plan, as applicable; such fees and expenses would reduce the total returns for all periods shown. Total return and portfolio turnover are not annualized for periods of less than one year. The portfolio turnover rate is calculated without regard to purchase and sales transactions of short-term instruments and certain derivatives, if any. If such transactions were included, the Fund’s portfolio turnover rate may be higher. Six Months Ended June 30, 2016 (Unaudited)
2015
2014
2013
2012
2011
$16.02
$18.42
$20.46
$15.41
$14.59
$17.53
Net investment income
0.07
0.10
0.16
0.11
0.16
0.12
Net realized and unrealized gain (loss)
0.65
(1.15)
0.46
5.14
1.44
(1.04)
Total from investment operations
0.72
(1.05)
0.62
5.25
1.60
(0.92)
Net investment income
—
(0.15)
(0.12)
(0.20)
(0.07)
(0.17)
Net realized gains
—
(1.20)
(2.54)
—
(0.71)
(1.85)
Class 1
Year Ended December 31,
Per share data Net asset value, beginning of period Income from investment operations:
Less distributions to shareholders:
Total distributions to shareholders Net asset value, end of period Total return Ratios to average net assets
—
(1.35)
(2.66)
(0.20)
(0.78)
(2.02)
$16.74
$16.02
$18.42
$20.46
$15.41
$14.59
4.49%
(6.12%)
3.28%
34.22%
11.40%
(5.96%)
(a)
Total gross expenses
0.98%(b)
0.98%
0.98%
0.98%(c)
1.00%
0.98%(c)
Total net expenses(d)
0.93%(b)
0.93%
0.88%
0.88%(c)
0.88%
0.90%(c)
(b)
0.56%
0.81%
0.63%
1.06%
0.76%
Net investment income
0.94%
Supplemental data Net assets, end of period (in thousands) Portfolio turnover
$5,710
$6,045
36%
$7,270
64%
51%
$8,084 58%
$20,532 49%
$25,058 32%
Notes to Financial Highlights (a) In addition to the fees and expenses that the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of any other funds in which it invests. Such indirect expenses are not included in the Fund’s reported expense ratios. (b) Annualized. (c) Ratios include line of credit interest expense which is less than 0.01%. (d) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of this statement.
16
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS (continued)
Class 2
Six Months Ended June 30, 2016 (Unaudited)
2015
2014
2013
2012
2011
$15.94
$18.33
$20.39
$15.36
$14.54
$17.49
Year Ended December 31,
Per share data Net asset value, beginning of period Income from investment operations: Net investment income
0.06
0.06
0.12
0.09
0.14
0.10
Net realized and unrealized gain (loss)
0.64
(1.14)
0.46
5.12
1.43
(1.04)
Total from investment operations
0.70
(1.08)
0.58
5.21
1.57
(0.94)
Net investment income
—
(0.11)
(0.10)
(0.18)
(0.04)
(0.16)
Net realized gains
—
(1.20)
(2.54)
—
(0.71)
(1.85)
Total distributions to shareholders
—
(1.31)
(2.64)
(0.18)
(0.75)
(2.01)
$16.64
$15.94
$18.33
$20.39
$15.36
$14.54
Less distributions to shareholders:
Net asset value, end of period Total return
4.39%
(6.32%)
3.05%
34.04%
11.25%
(6.13%)
1.23%
1.23%
1.23%(c)
1.25%
1.23%(c)
(c)
1.03%
1.05%(c)
0.93%
0.61%
Ratios to average net assets(a) Total gross expenses (d)
1.24%(b)
Total net expenses
1.18%
(b)
1.18%
1.10%
1.03%
Net investment income
0.70%(b)
0.32%
0.60%
0.51%
Supplemental data Net assets, end of period (in thousands) Portfolio turnover
$326,495
$320,184
36%
$368,768
64%
51%
$379,959
$298,663
58%
$266,172
49%
32%
Notes to Financial Highlights (a) In addition to the fees and expenses that the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of any other funds in which it invests. Such indirect expenses are not included in the Fund’s reported expense ratios. (b) Annualized. (c) Ratios include line of credit interest expense which is less than 0.01%. (d) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of this statement. Semiannual Report 2016
17
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS June 30, 2016 (Unaudited)
Note 1. Organization Columbia Variable Portfolio — Small Cap Value Fund (the Fund), a series of Columbia Funds Variable Insurance Trust (the Trust), is a diversified fund. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.
Fund Shares The Trust may issue an unlimited number of shares (without par value). The Fund offers Class 1 and Class 2 shares to separate accounts funding variable annuity contracts and variable life insurance policies (collectively, Contracts) issued by affiliated and unaffiliated life insurance companies as well as qualified pension and retirement plans (Qualified Plans) and other qualified institutional investors (Qualified Investors) authorized by Columbia Management Investment Distributors, Inc. (the Distributor). You may not buy (nor will you own) shares of the Fund directly. You may invest by participating in a Qualified Plan or by buying a Contract and making allocations to the Fund. Although all share classes generally have identical voting, dividend and liquidation rights, each share class votes separately when required by the Trust’s organizational documents or by law. Different share classes pay different distribution amounts to the extent the expenses of such share classes differ, and distributions in liquidation will be proportional to the net asset value of each share class. Each share class has its own cost structure and other features.
Note 2. Summary of Significant Accounting Policies Basis of Preparation The Fund is an investment company that applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services — Investment Companies (ASC 946). The financial statements are prepared in accordance with U.S. generally accepted accounting principles (GAAP), which requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
18
Semiannual Report 2016
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.
Security Valuation All equity securities are valued at the close of business of the New York Stock Exchange (NYSE). Equity securities are valued at the last quoted sales price on the principal exchange or market on which they trade, except for securities traded on the NASDAQ Stock Market, which are valued at the NASDAQ official close price. Unlisted securities or listed securities for which there were no sales during the day are valued at the mean of the latest quoted bid and ask prices on such exchanges or markets. Foreign equity securities are valued based on the closing price on the foreign exchange in which such securities are primarily traded. If any foreign equity security closing prices are not readily available, the securities are valued at the mean of the latest quoted bid and ask prices on such exchanges or markets. Foreign currency exchange rates are generally determined at 4:00 p.m. Eastern (U.S.) time. Many securities markets and exchanges outside the U.S. close prior to the close of the NYSE; therefore, the closing prices for securities in such markets or on such exchanges may not fully reflect events that occur after such close but before the close of the NYSE. In those situations, foreign securities will be fair valued pursuant to a policy adopted by the Board of Trustees (the Board), including, if available, utilizing a third party pricing service to determine these fair values. The third party pricing service takes into account multiple factors, including, but not limited to, movements in the U.S. securities markets, certain depositary receipts, futures contracts and foreign exchange rates that have occurred subsequent to the close of the foreign exchange or market, to determine a good faith estimate that reasonably reflects the current market conditions as of the close of the NYSE. The fair value of a security is likely to be different from the quoted or published price, if available. Investments in open-end investment companies, including money market funds, are valued at their latest net asset value. Investments for which market quotations are not readily available, or that have quotations which management believes are not reflective of market value or reliable, are valued at fair value as determined in good faith under procedures approved by and under the general supervision of the Board. If a security or class of
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2016 (Unaudited) securities (such as foreign securities) is valued at fair value, such value is likely to be different from the quoted or published price for the security. The determination of fair value often requires significant judgment. To determine fair value, management may use assumptions including but not limited to future cash flows and estimated risk premiums. Multiple inputs from various sources may be used to determine fair value. GAAP requires disclosure regarding the inputs and valuation techniques used to measure fair value and any changes in valuation inputs or techniques. In addition, investments shall be disclosed by major category. This information is disclosed following the Fund’s Portfolio of Investments.
Foreign Currency Transactions and Translations The values of all assets and liabilities denominated in foreign currencies are generally translated into U.S. dollars at exchange rates determined at the close of the NYSE on any given day. Net realized and unrealized gains (losses) on foreign currency transactions and translations include gains (losses) arising from the fluctuation in exchange rates between trade and settlement dates on securities transactions, gains (losses) arising from the disposition of foreign currency and currency gains (losses) between the accrual and payment dates on dividends, interest income and foreign withholding taxes. For financial statement purposes, the Fund does not distinguish that portion of gains (losses) on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. Such fluctuations are included with the net realized and unrealized gains (losses) on investments in the Statement of Operations.
Security Transactions Security transactions are accounted for on the trade date. Cost is determined and gains (losses) are based upon the specific identification method for both financial statement and federal income tax purposes.
Income Recognition Corporate actions and dividend income are generally recorded net of any non-reclaimable tax withholdings, on the ex-dividend date or upon receipt of ex-dividend notification in the case of certain foreign securities. The Fund may receive distributions from holdings in equity securities, business development companies (BDCs), exchange-traded funds, other regulated
investment companies (RICs), and real estate investment trusts (REITs), which report information on the tax character of their distributions annually. These distributions are allocated to dividend income, capital gain and return of capital based on actual information reported. Return of capital is recorded as a reduction of the cost basis of securities held. If the Fund no longer owns the applicable securities, return of capital is recorded as a realized gain. With respect to REITs, to the extent actual information has not yet been reported, estimates for return of capital are made by the Fund’s management. Management’s estimates are subsequently adjusted when the actual character of the distributions is disclosed by the REITs, which could result in a proportionate change in return of capital to shareholders. Awards from class action litigation are recorded as a reduction of cost basis if the Fund still owns the applicable securities on the payment date. If the Fund no longer owns the applicable securities, the proceeds are recorded as realized gains.
Expenses General expenses of the Trust are allocated to the Fund and other funds of the Trust based upon relative net assets or other expense allocation methodologies determined by the nature of the expense. Expenses directly attributable to the Fund are charged to the Fund. Expenses directly attributable to a specific class of shares are charged to that share class.
Determination of Class Net Asset Value All income, expenses (other than class-specific expenses, which are charged to that share class, as shown in the Statement of Operations) and realized and unrealized gains (losses) are allocated to each class of the Fund on a daily basis, based on the relative net assets of each class, for purposes of determining the net asset value of each class.
Federal Income Tax Status The Fund intends to qualify each year as a regulated investment company under Subchapter M of the Internal Revenue Code, as amended, and will distribute substantially all of its taxable income, if any, for its tax year, and as such will not be subject to federal income taxes. In addition, because the Fund’s sole shareholders are Qualified Investors, the Fund expects not to be subject to federal excise tax. Therefore, no federal income or excise tax provision is recorded.
Semiannual Report 2016
19
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2016 (Unaudited) Foreign Taxes The Fund may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries, as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests. Realized gains in certain countries may be subject to foreign taxes at the Fund level, based on statutory rates. The Fund accrues for such foreign taxes on realized and unrealized gains at the appropriate rate for each jurisdiction, as applicable. The amount, if any, is disclosed as a liability on the Statement of Assets and Liabilities.
Distributions to Subaccounts Distributions to the subaccounts of Contracts, Qualified Plans and Qualified Investors are recorded at the close of business on the record date and are payable on the first business day following the record date. Dividends from net investment income, if any, are declared and distributed annually. Capital gains distributions, when available, will be made annually. However, an additional capital gain distribution may be made during the fiscal year in order to comply with the Internal Revenue Code, as applicable to registered investment companies. Income distributions and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. All dividends and distributions are reinvested in additional shares of the applicable share class of the Fund at the net asset value as of the ex-dividend date of the distribution.
Guarantees and Indemnifications Under the Trust’s organizational documents and, in some cases, by contract, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust or its funds. In addition, certain of the Fund’s contracts with its service providers contain general indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown since the amount of any future claims that may be made against the Fund cannot be determined, and the Fund has no historical basis for predicting the likelihood of any such claims.
Note 3. Fees and Other Transactions with Affiliates Management Fees Effective May 1, 2016, the Fund entered into a Management Agreement with Columbia Management Investment Advisers, LLC (the Investment Manager), a wholly-owned subsidiary of Ameriprise Financial, Inc. (Ameriprise Financial). Under the Management Agreement, the Investment Manager provides the Fund with investment research and advice, as well as administrative and accounting services. The management services fee is an annual fee that is equal to a percentage of the Fund’s average daily net assets that declines from 0.87% to 0.75% as the Fund’s net assets increase. The annualized effective management services fee rate for the six months ended June 30, 2016 was 0.87% of the Fund’s average daily net assets. Prior to May 1, 2016, the Fund paid the Investment Manager an annual fee for advisory services under an Investment Management Services Agreement and a separate annual fee for administrative and accounting services under an Administrative Services Agreement. For the period from January 1, 2016 through April 30, 2016, the investment advisory services fee paid to the Investment Manager was $827,761, and the administrative services fee paid to the Investment Manager was $83,824.
Compensation of Board Members Board members, who are not officers or employees of the Investment Manager or Ameriprise Financial, are compensated for their services to the Fund as disclosed in the Statement of Operations. These Board members may participate in a Deferred Compensation Plan (the Plan) which may be terminated at any time. Obligations of the Plan will be paid solely out of the Fund’s assets, and all amounts payable under the Plan constitute a general unsecured obligation of the Fund.
Compensation of Chief Compliance Officer The Board has appointed a Chief Compliance Officer to the Fund in accordance with federal securities regulations. The Fund is allocated a portion of the expenses associated with the Chief Compliance Officer based on relative net assets of the Trust.
Transfer Agency Fees The Fund has a Transfer and Dividend Disbursing Agent Agreement with Columbia Management Investment Services Corp. (the Transfer Agent), an affiliate of the
20
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2016 (Unaudited) Investment Manager and a wholly-owned subsidiary of Ameriprise Financial. The annual fee rate under this agreement is 0.06% of the Fund’s average daily net assets attributable to each share class.
Distribution Fees The Fund has an agreement with the Distributor, an affiliate of the Investment Manager and a wholly-owned subsidiary of Ameriprise Financial, for distribution services. The Board has approved, and the Fund has adopted, a distribution plan (the Plan) which sets the distribution fees for the Fund. These fees are calculated daily and are intended to compensate the Distributor for selling shares of the Fund. The Fund pays a monthly distribution fee to the Distributor at the maximum annual rate of 0.25% of the average daily net assets attributable to Class 2 shares of the Fund. The Fund pays no distribution and service fees for Class 1 shares.
Expenses Waived/Reimbursed by the Investment Manager and its Affiliates The Investment Manager and certain of its affiliates have contractually agreed to waive fees and/or reimburse expenses (excluding certain fees and expenses described below) for the period disclosed below, unless sooner terminated at the sole discretion of the Board, so that the Fund’s net operating expenses, after giving effect to fees waived/expenses reimbursed and any balance credits and/or overdraft charges from the Fund’s custodian, do not exceed the following annual rates as a percentage of the class’ average daily net assets: Fee Rates Contractual through April 30, 2017 Class 1
0.93%
Class 2
1.18
Under the agreement, the following fees and expenses are excluded from the waiver/reimbursement commitment, and therefore will be paid by the Fund, if applicable: taxes (including foreign transaction taxes), expenses associated with investments in affiliated and non-affiliated pooled investment vehicles (including mutual funds and exchange-traded funds), transaction costs and brokerage commissions, costs related to any securities lending program, dividend and interest expenses associated with securities sold short, inverse floater program fees and expenses, transaction charges and interest on borrowed money, interest, infrequent and/or unusual expenses and any other expenses the exclusion of which is specifically approved by the Board.
This agreement may be modified or amended only with approval from the Investment Manager, certain of its affiliates and the Fund. Any fees waived and/or expenses reimbursed under the expense reimbursement arrangements described above are not recoverable by the Investment Manager or its affiliates in future periods.
Note 4. Federal Tax Information The timing and character of income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP because of temporary or permanent book to tax differences. At June 30, 2016, the cost of investments for federal income tax purposes was approximately $327,693,000 and the aggregate gross approximate unrealized appreciation and depreciation based on that cost was: Unrealized appreciation
$35,224,000
Unrealized depreciation
(32,213,000)
Net unrealized appreciation
$3,011,000
Management of the Fund has concluded that there are no significant uncertain tax positions in the Fund that would require recognition in the financial statements. However, management’s conclusion may be subject to review and adjustment at a later date based on factors including, but not limited to, new tax laws, regulations, and administrative interpretations (including relevant court decisions). Generally, the Fund’s federal tax returns for the prior three fiscal years remain subject to examination by the Internal Revenue Service.
Note 5. Portfolio Information The cost of purchases and proceeds from sales of securities, excluding short-term investments and derivatives, if any, aggregated to $117,017,441 and $126,883,080, respectively, for the six months ended June 30, 2016. The amount of purchase and sale activity impacts the portfolio turnover rate reported in the Financial Highlights.
Note 6. Affiliated Money Market Fund The Fund invests in Columbia Short-Term Cash Fund, an affiliated money market fund established for the exclusive use by the Fund and other affiliated funds. The income earned by the Fund from such investments is included as Dividends — affiliated issuers in the Statement of Operations. As an investing fund, the Fund indirectly bears its proportionate share of the expenses of Columbia Short-Term Cash Fund.
Semiannual Report 2016
21
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2016 (Unaudited)
Note 7. Line of Credit The Fund has access to a revolving credit facility whereby the Fund may borrow for the temporary funding of shareholder redemptions or for other temporary or emergency purposes. Effective December 8, 2015, Citibank, N.A. and HSBC Bank USA, N.A. joined JPMorgan Chase Bank, N.A. (JPMorgan) as lead of a syndicate of banks under the credit facility, which is a collective agreement between the Fund and certain other funds managed by the Investment Manager, severally and not jointly, that permits collective borrowings up to $1 billion. Interest is charged to each participating fund based on its borrowings at a rate equal to the higher of (i) the overnight federal funds rate plus 1.00% or (ii) the one-month LIBOR rate plus 1.00%. Each borrowing under the credit facility matures no later than 60 days after the date of borrowing. The Fund also pays a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.15% per annum. The commitment fee is included in other expenses in the Statement of Operations. Prior to December 8, 2015, JPMorgan was the sole lead bank under the credit facility agreement that permitted borrowings up to $550 million under the same terms and interest rates as described above with the exception of the commitment fee which was charged at a rate of 0.075% per annum. The Fund had no borrowings during the six months ended June 30, 2016.
Note 8. Significant Risks Shareholder Concentration Risk At June 30, 2016, three unaffiliated shareholders of record owned 94.3% of the outstanding shares of the Fund in one or more accounts. The Fund has no knowledge about whether any portion of those shares was owned beneficially. Subscription and redemption activity by concentrated accounts may have a significant effect on the operations of the Fund. In the case of a large redemption, the Fund may be forced to sell investments at inopportune times, including its liquid or more liquid positions, resulting in Fund losses and the Fund holding a higher percentage of less liquid or illiquid securities. Large redemptions could result in decreased economies of scale and increased operating expenses for non-redeeming Fund shareholders.
Financial Sector Risk The Fund may be more susceptible to the particular risks that may affect companies in the financial services sector than if it were invested in a wider variety of 22
Semiannual Report 2016
companies in unrelated sectors. Companies in the financial services sector are subject to certain risks, including the risk of regulatory change, decreased liquidity in credit markets and unstable interest rates. Such companies may have concentrated portfolios, such as a high level of loans to real estate developers, which makes them vulnerable to economic conditions that affect that industry. Performance of such companies may be affected by competitive pressures and exposure to investments or agreements that, under certain circumstances, may lead to losses (e.g., subprime loans). Companies in the financial services sector are subject to extensive governmental regulation that may limit the amount and types of loans and other financial commitments they can make, and interest rates and fees that they may charge. In addition, profitability of such companies is largely dependent upon the availability and the cost of capital.
Note 9. Subsequent Events Management has evaluated the events and transactions that have occurred through the date the financial statements were issued and noted no items requiring adjustment of the financial statements or additional disclosure.
Note 10. Information Regarding Pending and Settled Legal Proceedings In December 2005, without admitting or denying the allegations, American Express Financial Corporation (AEFC, which is now known as Ameriprise Financial, Inc. (Ameriprise Financial)) entered into settlement agreements with the Securities and Exchange Commission (SEC) and Minnesota Department of Commerce (MDOC) related to market timing activities. As a result, AEFC was censured and ordered to cease and desist from committing or causing any violations of certain provisions of the Investment Advisers Act of 1940, the Investment Company Act of 1940, and various Minnesota laws. AEFC agreed to pay disgorgement of $10 million and civil money penalties of $7 million. AEFC also agreed to retain an independent distribution consultant to assist in developing a plan for distribution of all disgorgement and civil penalties ordered by the SEC in accordance with various undertakings detailed at http://www.sec.gov/litigation/admin/ia-2451.pdf. Ameriprise Financial and its affiliates have cooperated with the SEC and the MDOC in these legal proceedings, and have made regular reports to the Funds’ Boards of Trustees.
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2016 (Unaudited) Ameriprise Financial and certain of its affiliates have historically been involved in a number of legal, arbitration and regulatory proceedings, including routine litigation, class actions, and governmental actions, concerning matters arising in connection with the conduct of their business activities. Ameriprise Financial believes that the Funds are not currently the subject of, and that neither Ameriprise Financial nor any of its affiliates are the subject of, any pending legal, arbitration or regulatory proceedings that are likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Funds. Ameriprise Financial is required to make quarterly (10-Q), annual (10-K) and, as necessary, 8-K filings with the SEC on legal and regulatory matters that relate to Ameriprise Financial and its affiliates. Copies of these filings may be obtained by accessing the SEC website at www.sec.gov. There can be no assurance that these matters, or the adverse publicity associated with them, will not result in increased fund redemptions, reduced sale of fund shares or other adverse consequences to the Funds. Further, although we believe proceedings are not likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Funds, these proceedings are subject to uncertainties and, as such, we are unable to estimate the possible loss or range of loss that may result. An adverse outcome in one or more of these proceedings could result in adverse judgments, settlements, fines, penalties or other relief that could have a material adverse effect on the consolidated financial condition or results of operations of Ameriprise Financial.
Semiannual Report 2016
23
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
BOARD CONSIDERATION AND APPROVAL OF MANAGEMENT AGREEMENT On June 10, 2016, the Board of Trustees (the Board) and the Trustees who are not interested persons (as defined in the Investment Company Act of 1940) (the Independent Trustees) of Columbia Funds Variable Insurance Trust (the Trust) unanimously approved the continuation of the Management Agreement (the Management Agreement) with Columbia Management Investment Advisers, LLC (the Investment Manager) with respect to Columbia Variable Portfolio — Small Cap Value Fund (the Fund), a series of the Trust. As detailed below, the Board’s Advisory Fees and Expenses Committee (the Committee) and the Board met on multiple occasions to review and discuss, both among themselves and with the management team of the Investment Manager, materials provided by the Investment Manager and others before determining to approve the continuation of the Management Agreement. In connection with their deliberations regarding the continuation of the Management Agreement, the Committee and the Board evaluated materials requested from the Investment Manager regarding the Fund and the Management Agreement, and discussed these materials with representatives of the Investment Manager at Committee meetings held on March 8, 2016, April 27, 2016 and June 9, 2016 and at Board meetings held on March 9, 2016 and June 10, 2016. In addition, the Board considers matters bearing on the Management Agreement at most of its other meetings throughout the year and meets regularly with senior management of the Trust and the Investment Manager. Through the Board’s Investment Oversight Committees, Trustees also meet with selected portfolio managers of the funds the Trustees oversee and other investment personnel at various times throughout the year. The Committee and the Board also consulted with its independent fee consultant, Fund counsel and with the Independent Trustees’ independent legal counsel, who advised on various matters with respect to the Committee’s and the Board’s considerations and otherwise assisted the Committee and the Board in their deliberations. On June 9, 2016, the Committee recommended that the Board approve the continuation of the Management Agreement. On June 10, 2016, the Board, including the Independent Trustees, voting separately, unanimously approved the continuation of the Management Agreement for the Fund. The Committee and the Board considered all information that they, their legal counsel or the Investment Manager believed reasonably necessary to evaluate and to determine whether to approve the continuation of the Management Agreement. The information and factors considered by the Committee and the Board in recommending for approval or approving the continuation of the Management Agreement for the Fund included the following: • Information on the investment performance of the Fund relative to the performance of a group of mutual funds determined to be comparable to the Fund by an independent third-party data provider, as well as performance relative to benchmarks; • Information on the Fund’s management fees and total expenses, including information comparing the Fund’s expenses to those of a group of comparable mutual funds, as determined by the independent third-party data provider; • The Investment Manager’s agreement to contractually limit or cap total operating expenses for the Fund through April 30, 2017 so that total operating expenses (excluding certain fees and expenses, such as transaction costs and certain other investment related expenses, interest, taxes, acquired fund fees and expenses, and infrequent and/or unusual expenses) would not exceed a specified annual rate, as a percentage of the Fund’s net assets; • The terms and conditions of the Management Agreement; • The current and proposed terms and conditions of other agreements and arrangements with affiliates of the Investment Manager relating to the operations of the Fund, including agreements with respect to the provision of distribution and transfer agency services to the Fund; • Descriptions of various functions performed by the Investment Manager under the Management Agreement, including portfolio management and portfolio trading practices; • Information regarding the management fees of similarly-managed portfolios of other clients of the Investment Manager, including institutional separate accounts;
24
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
BOARD CONSIDERATION AND APPROVAL OF MANAGEMENT AGREEMENT (continued) • Information regarding the reputation, regulatory history and resources of the Investment Manager, including information regarding senior management, portfolio managers and other personnel; • Information regarding the capabilities of the Investment Manager with respect to compliance monitoring services, including an assessment of the Investment Manager’s compliance system by the Fund’s Chief Compliance Officer; and • The profitability to the Investment Manager and its affiliates from their relationships with the Fund.
Nature, Extent and Quality of Services Provided under the Management Agreement The Committee and the Board considered the nature, extent and quality of services provided to the Fund by the Investment Manager and its affiliates under the Management Agreement and under separate agreements for the provision of transfer agency services, and the resources dedicated to the Fund and the other Columbia Funds by the Investment Manager and its affiliates. The Committee and the Board considered, among other things, the Investment Manager’s ability to attract, motivate and retain highly qualified research, advisory and supervisory investment professionals (including personnel and other resources, compensation programs for personnel involved in fund management, reputation and other attributes), the portfolio management services provided by those investment professionals, and the quality of the Investment Manager’s investment research capabilities and trade execution services. The Committee and the Board also considered the potential benefits to shareholders of investing in a mutual fund that is part of a fund complex offering exposure to a variety of asset classes and investment disciplines and providing a variety of fund and shareholder services. The Committee and the Board also considered the professional experience and qualifications of the senior personnel of the Investment Manager, which included consideration of the Investment Manager’s experience with similarly-structured funds. The Committee and the Board noted the compliance programs of and the compliance-related resources provided to the Fund by the Investment Manager and its affiliates, and considered the Investment Manager’s ability to provide administrative services to the Fund and coordinate the activities of the Fund’s other service providers. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the nature, extent and quality of the services provided to the Fund under the Management Agreement supported the continuation of the Management Agreement.
Investment Performance The Committee and the Board reviewed information about the performance of the Fund over various time periods, including performance information relative to benchmarks and information based on reports of the independent third-party data provider that compared the performance of the Fund to the performance of a group of comparable mutual funds, and data provided by the independent fee consultant. The Committee and the Board also reviewed a description of the third party’s methodology for identifying the Fund’s peer groups for purposes of performance and expense comparisons. Although the Fund’s performance lagged that of a relevant peer group for certain (although not necessarily all) periods, the Committee and the Board concluded that other factors relevant to performance were sufficient, in light of other considerations, to warrant continuation of the Management Agreement. Those factors included one or more of the following: (i) that the Fund’s performance, although lagging in certain recent periods, was stronger over the longer term; (ii) that the underperformance was attributable, to a significant extent, to investment decisions that were reasonable and consistent with the Fund’s investment strategy and policies and that the Fund was performing within a reasonable range of expectations, given those investment decisions, market conditions and the Fund’s investment strategy; (iii) that the Fund’s performance was competitive when compared to other relevant performance benchmarks or peer groups; and (iv) that the Investment Manager had taken or was taking steps designed to help improve the Fund’s investment performance, including, but not limited to, replacing portfolio managers, enhancing the resources supporting the portfolio managers, or modifying investment strategies. The Committee and the Board noted that, through December 31, 2015, the Fund’s performance was in the forty-ninth, sixty-first and seventy-fifth percentile (where the best performance would be in the first percentile) of
Semiannual Report 2016
25
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
BOARD CONSIDERATION AND APPROVAL OF MANAGEMENT AGREEMENT (continued) its category selected by the independent third-party data provider for the purposes of performance comparisons for the one-, three- and five-year periods, respectively. The Committee and the Board also considered the Investment Manager’s performance and reputation generally, the Investment Manager’s historical responsiveness to Board concerns about performance, and the Investment Manager’s willingness to take steps intended to improve performance. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the performance of the Fund and the Investment Manager was sufficient, in light of other considerations, to warrant the continuation of the Management Agreement.
Investment Management Fee Rates and Other Expenses The Committee and the Board considered the management fees charged to the Fund under the Management Agreement as well as the total expenses incurred by the Fund. In assessing the reasonableness of the fees under the Management Agreement, the Committee and the Board considered, among other information, the Fund’s management fee and its total expense ratio as a percentage of average daily net assets. The Committee and the Board considered data provided by the independent fee consultant. The Committee and the Board noted that, as of December 31, 2015, the Fund’s actual management fee and net total expense ratio are both ranked in the third quintile (where the lowest fees and expenses would be in the first quintile) against the Fund’s expense universe as determined by the independent third-party data provider for purposes of expense comparison. The Committee and the Board also took into account the fee waiver and expense limitation arrangements agreed to by the Investment Manager, as noted above. The Committee and the Board also received and considered information about the management fees charged by the Investment Manager to institutional separate accounts. In considering the fees charged to those accounts, the Committee and the Board took into account, among other things, the Investment Manager’s representations about the differences between managing mutual funds as compared to other types of accounts, including differences in the services provided, differences in the risk profile of such business for the Investment Manager and the additional resources required to manage mutual funds effectively. The Committee and the Board also received and considered information about the fees charged by the Investment Manager for sub-advisory services provided to comparable unaffiliated funds. In evaluating the Fund’s management fees, the Committee and the Board also took into account the demands, complexity and quality of the investment management of the Fund. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the management fee rates and expenses of the Fund were sufficient, in light of other considerations, to warrant the continuation of the Management Agreement.
Costs of Services Provided and Profitability The Committee and the Board also took note of the costs the Investment Manager and its affiliates incur in connection with the services provided (both on an absolute and relative basis) and the profitability to the Investment Manager and its affiliates in connection with their relationships with the Fund. The Committee and the Board also considered the compensation directly or indirectly received by the Investment Manager’s affiliates in connection with their relationships with the Fund. The Committee and the Board reviewed information provided by management as to the profitability to the Investment Manager and its affiliates of their relationships with the Fund, information about the allocation of expenses used to calculate profitability, and comparisons of profitability levels realized in 2015 to profitability levels realized in 2014. When reviewing profitability, the Committee and the Board also considered court cases in which adviser profitability was an issue in whole or in part, the performance of similarly managed funds, the performance of the Fund, and the expense ratio of the Fund. In addition, the Committee and the Board considered information provided by the Investment Manager regarding the Investment Manager’s financial condition and comparing its profitability to that of other asset management firms that are, or are subsidiaries of, publicly traded companies. In this regard, the Committee and the Board also considered data provided by the independent fee consultant.
26
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
BOARD CONSIDERATION AND APPROVAL OF MANAGEMENT AGREEMENT (continued) After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the costs of services provided and the profitability to the Investment Manager and its affiliates from their relationships with the Fund supported the continuation of the Management Agreement.
Economies of Scale The Committee and the Board considered the potential existence of economies of scale in the provision by the Investment Manager of services to the Fund, to groups of related funds, and to the Investment Manager’s investment advisory clients as a whole, and whether those economies of scale were shared with the Fund through breakpoints in investment management fees or other means, such as expense limitation arrangements and additional investments by the Investment Manager in investment, trading and compliance resources. The Committee and the Board noted that the management fee schedules for the Fund contained breakpoints that would reduce the fee rate on assets above specified threshold levels. In considering these matters, the Committee and the Board also considered the costs of the services provided and the profitability to the Investment Manager and its affiliates from their relationships with the Fund, as discussed above. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the extent to which any economies of scale were expected to be shared with the Fund supported the continuation of the Management Agreement.
Other Benefits to the Investment Manager The Committee and the Board received and considered information regarding “fall-out” or ancillary benefits received by the Investment Manager and its affiliates as a result of their relationships with the Fund, such as the engagement of the Investment Manager to provide administrative services to the Fund and the engagement of the Investment Manager’s affiliates to provide distribution and transfer agency services to the Fund. In this regard, among other matters, the Committee and the Board considered that the Fund’s distributor retains a portion of the distribution fees from the Fund. The Committee and the Board also considered the benefits of research made available to the Investment Manager by reason of brokerage commissions generated by the Fund’s securities transactions, and reviewed information about the Investment Manager’s practices with respect to allocating portfolio transactions for brokerage and research services. The Committee and the Board considered the possible conflicts of interest associated with certain fall-out or other ancillary benefits and the reporting, disclosure and other processes that are in place to address such possible conflicts of interest. The Committee and the Board recognized that the Investment Manager’s profitability would be somewhat lower without these benefits.
Conclusion The Committee and the Board reviewed all of the above considerations in reaching their decisions to recommend or approve the continuation of the Management Agreement. In their deliberations, the Trustees did not identify any particular information that was all-important or controlling, and individual Trustees may have attributed different weights to the various factors. Based on their evaluation of all factors that they deemed to be material, including those factors described above, and assisted by the advice of independent legal counsel, the Board, including the Independent Trustees, voting separately, unanimously approved the continuation of the Management Agreement.
Semiannual Report 2016
27
This page intentionally left blank.
28
Semiannual Report 2016
COLUMBIA VARIABLE PORTFOLIO — SMALL CAP VALUE FUND
IMPORTANT INFORMATION ABOUT THIS REPORT The policy of the Board is to vote the proxies of the companies in which each fund holds investments consistent with the procedures as stated in the Statement of Additional Information (SAI). You may obtain a copy of the SAI without charge by calling 800.345.6611, contacting your financial intermediary or searching the website of the Securities and Exchange Commission (SEC) at sec.gov. Information regarding how each fund voted proxies relating to portfolio securities is filed with the SEC by August 31st for the most recent 12-month period ending June 30th of that year, and is available without charge by visiting investor.columbiathreadneedleus.com, or searching the website of the SEC at sec.gov. Each fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Each fund’s Form N-Q is available on the SEC’s website at sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 800.SEC.0330. Each fund’s complete schedule of portfolio holdings, as filed on Form N-Q, can also be obtained without charge, upon request, by calling 800.345.6611.
Semiannual Report 2016
29
Columbia Variable Portfolio — Small Cap Value Fund P.O. Box 8081 Boston, MA 02266-8081
This information is for use with concurrent or prior delivery of a fund prospectus. Please read and consider the investment objectives, risks, charges and expenses for any fund carefully before investing. For fund and other investment product prospectuses, which contain this and other important information, contact your financial advisor or insurance representative. Please read the prospectus carefully before you invest. The Fund is distributed by Columbia Management Investment Distributors, Inc., member FINRA, and managed by Columbia Management Investment Advisers, LLC. Columbia Threadneedle Investments (Columbia Threadneedle) is the global brand name of the Columbia and Threadneedle group of companies. All rights reserved. Columbia Management Investment Distributors, Inc., 225 Franklin Street, Boston, MA 02110-2804 © 2016 Columbia Management Investment Advisers, LLC.
C-1505 AK (8/16)
(NYLIAC) NI271
