Schwab Annuity Portfolios – ‘NSAR-B’ for 12/31/02 – ‘EX-99’

On:  Friday, 2/28/03, at 3:55pm ET   ·   Effective:  2/28/03   ·   For:  12/31/02   ·   Accession #:  1041062-3-68   ·   File #:  811-08314

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Annual Report by an Investment Company   —   Form N-SAR   —   ICA’40
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: NSAR-B      Annual Report by an Investment Company                19     78K 
 3: EX-99       Miscellaneous Exhibit                                  2±     8K 
 2: EX-99.77Q3 CERT  Certification -- §302 - SOA'02                    4±    15K 

‘EX-99’   —   Miscellaneous Exhibit

Report of Independent Accountants                                               

To the Board of Trustees and Shareholders of                                    
Schwab Annuity Portfolios:                                                      
In planning and performing our audits of the                                    
financial statements of Schwab Money Market                                     
Portfolio, Schwab MarketTrack Growth Portfolio II                               
and Schwab S&P 500 Portfolio, (hereafter referred to                            
as the "funds") for the year ended December 31,                                 
2002, we considered their internal control,                                     
including control activities for safeguarding                                   
securities, in order to determine our auditing                                  
procedures for the purpose of expressing our                                    
opinions on the financial statements and to comply                              
with the requirements of Form N-SAR, not to provide                             
assurance on internal control.                                                  
The management of the funds is responsible for                                  
establishing and maintaining internal control.  In                              
fulfilling this responsibility, estimates and                                   
judgments by management are required to assess the                              
expected benefits and related costs of controls.                                
Generally, controls that are relevant to an audit                               
pertain to the entity's objective of preparing                                  
financial statements for external purposes that are                             
fairly presented in conformity with accounting                                  
principles generally accepted in the United States                              
of America.  Those controls include the safeguarding                            
of assets against unauthorized acquisition, use or                              
disposition.                                                                    
Because of inherent limitations in internal control,                            
errors or fraud may occur and not be detected.                                  
Also, projection of any evaluation of internal                                  
control to future periods is subject to the risk                                
that controls may become inadequate because of                                  
changes in conditions or that the effectiveness of                              
their design and operation may deteriorate.                                     
Our consideration of internal control would not                                 
necessarily disclose all matters in internal control                            
that might be material weaknesses under standards                               
established by the American Institute of Certified                              
Public Accountants.  A material weakness is a                                   
condition in which the design or operation of one or                            
more of the internal control components does not                                
reduce to a relatively low level the risk that                                  
misstatements caused by error or fraud in amounts                               
that would be material in relation to the financial                             
statements being audited may occur and not be                                   
detected within a timely period by employees in the                             
normal course of performing their assigned                                      
functions.  However, we noted no matters involving                              
internal control and its operation, including                                   
controls for safeguarding securities that we                                    
consider to be material weaknesses as defined above                             
as of December 31, 2002.                                                        
This report is intended solely for the information                              
and use of the Board of Trustees, management and the                            
Securities and Exchange Commission and is not                                   
intended to be and should not be used by anyone                                 
other than these specified parties.                                             

PricewaterhouseCoopers LLP                                                      
San Francisco, CA                                                               
February 7, 2003                                                                
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Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘NSAR-B’ Filing		Date		Other Filings
Filed on / Effective on:		2/28/03
For Period end:		12/31/02		24F-2NT,  N-30D
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