The Prudential Series Fund

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Pruco Life Insurance Company Notes to Consolidated Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) adopted this guidance effective December 31, 2008. The Company’s adoption of this guidance did not have a material effect on the Company’s consolidated financial position or results of operations. In March 2008, the FASB issued SFAS No. 161, ―Disclosures about Derivative Instruments and Hedging Activities‖ an amendment of SFAS No. 133. This statement amends and expands the disclosure requirements for derivative instruments and hedging activities by requiring companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under FASB Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. The Company will adopt this guidance effective January 1, 2009. The Company’s adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial position or results of operations. In February 2008, the FASB issued FSP FAS 140-3, ―Accounting for Transfers of Financial Assets and Repurchase Financing Transactions.‖ The FSP provides recognition and derecognition guidance for a repurchase financing transaction, which is a repurchase agreement that relates to a previously transferred financial asset between the same counterparties, that is entered into contemporaneously with or in contemplation of, the initial transfer. The FSP is effective for fiscal years beginning after November 15, 2008. The FSP is to be applied prospectively to new transactions entered into after the adoption date. The Company will adopt this guidance effective January 1, 2009. The Company is currently assessing the impact of this FSP on the Company’s consolidated financial position and results of operations. In February 2008, the FASB issued FSP FAS 157-2, ―Effective Date of FASB Statement No. 157.‖ This FSP applies to nonfinancial assets and nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). FSP FAS 157-2 delays the effective date of SFAS No. 157 for these items to fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. The Company will adopt this guidance effective January 1, 2009. The Company’s adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial position or results of operations. In January 2008, the FASB issued Statement No. 133 Implementation Issue No. E23, ―Hedging—General: Issues Involving the Application of the Shortcut Method under Paragraph 68.‖ Implementation Issue No. E23 amends Statement No. 133, paragraph 68 with respect to the conditions that must be met in order to apply the shortcut method for assessing hedge effectiveness. This implementation guidance was effective for hedging relationships designated on or after January 1, 2008. The Company’s adoption of this guidance effective January 1, 2008 did not have a material effect on the Company’s consolidated financial position or results of operations. In December 2007, the FASB issued SFAS No. 160, ―Noncontrolling Interests in Consolidated Financial Statements.‖ SFAS No. 160 will change the accounting for minority interests, which will be recharacterized as noncontrolling interests and classified by the parent company as a component of equity. The Company will adopt this guidance effective January 1, 2009. Upon adoption, SFAS No. 160 requires retroactive adoption of the presentation and disclosure requirements for existing minority interests and prospective adoption for all other requirements. The Company’s adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial position or results of operations, but will affect financial statement presentation and disclosure. In February 2007, the Financial Accounting Standards Board (―FASB‖) issued SFAS No. 159, ―The Fair Value Option for Financial Assets and Financial Liabilities.‖ This statement provides companies with an option to report selected financial assets and liabilities at fair value, with the associated changes in fair value reflected in the Consolidated Statements of Operations. The Company has adopted this guidance effective January 1, 2008. The Company’s adoption of this guidance did not have a material effect on the Company’s consolidated financial position or results of operations. In September 2006, the Staff of the SEC issued Staff Accounting Bulletin (―SAB‖) No. 108, ―Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.‖ The interpretations in this SAB express the Staff’s views regarding the process of quantifying financial statement misstatements. Specifically, the SEC staff believes that registrants must quantify the impact on current period financial statements of correcting all misstatements, including both those occurring in the current period and the effect of reversing those that have accumulated from prior periods. This SAB should be applied beginning with the first fiscal year ending after November 15, 2006, with early adoption encouraged. Since the Company’s method for quantifying financial statement misstatements already considers those occurring in the current period and the effect of reversing those that have accumulated from prior periods, the adoption of SAB No. 108 had no effect to the financial position and result of operations of the Company. In September 2006, the FASB issued SFAS No. 157, ―Fair Value Measurements.‖ This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and requires additional disclosures about fair value measurements. This Statement does not require any new fair value measurements, but the application of this Statement B-12
Pruco Life Insurance Company Notes to Consolidated Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) could change current practices in determining fair value. The Company has adopted this guidance effective January 1, 2008. The Company’s adoption of this guidance did not have a material effect on the Company’s consolidated financial position or results of operations. In June 2006, the FASB issued FIN No. 48, ―Accounting for Uncertainty in Income Taxes,‖ an Interpretation of FASB Statement No. 109. See Note 7 for details regarding the adoption of this pronouncement. In February 2006, the FASB issued SFAS No. 155, ―Accounting for Certain Hybrid Instruments.‖ This statement also eliminates an exception from the requirement to bifurcate an embedded derivative feature from beneficial interests in securitized financial assets. The Company has relied upon this exception for certain investments that the Company has made in securitized financial assets in the normal course of operations, and thus has not previously had to consider whether such investments contain an embedded derivative. The new requirement to identify embedded derivatives in beneficial interests will be applied on a prospective basis only to beneficial interests acquired, issued, or subject to certain remeasurement conditions after the adoption of the guidance. This statement also provides an election, on an instrument by instrument basis, to measure at fair value an entire hybrid financial instrument that contains an embedded derivative requiring bifurcation, rather than measuring only the embedded derivative on a fair value basis. If the fair value election is chosen, changes in unrealized gains and losses are reflected in the Consolidated Statements of Operations. The Company adopted this guidance effective January 1, 2007. The Company’s adoption of this guidance did not have a material effect on the Company’s consolidated financial position or results of operations. In September 2005, the Accounting Standards Executive Committee (―AcSEC‖) of the American Institute of Certified Public Accountants issued Statement of Position (―SOP‖) 05-1, ―Accounting by Insurance Enterprises for Deferred Acquisition Costs in Connection With Modifications or Exchanges of Insurance Contracts.‖ SOP 05-1 provides guidance on accounting by insurance enterprises for deferred acquisition costs, including deferred policy acquisition costs, and deferred sales inducements, on internal replacements of insurance and investment contracts other than those specifically described in SFAS No. 97. SOP 05-1 defines an internal replacement as a modification in product benefits, features, rights, or coverages that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract, and was effective for internal replacements occurring in fiscal years beginning after December 15, 2006. The Company adopted SOP 05-1 on January 1, 2007, which resulted in a net after-tax reduction to retained earnings of $2.5 million. Reclassifications Certain amounts in the prior years have been reclassified to conform to the current year presentation. B-13
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MAY 1, 2009 PROSPECTUS The Prudenti
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THE PRUDENTIAL SERIES FUND Diversif
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THE PRUDENTIAL SERIES FUND Natural
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This prospectus discusses the follo
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INTRODUCTION ABOUT THE FUND AND ITS
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■ prepayment risk The Portfolio i
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■ ■ ■ ■ ■ ■ ■ ■ ■
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a representative sample of the stoc
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PRINCIPAL RISKS Although we try to
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Foreign investment risk. Investing
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Market risk. Market risk is the ris
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guaranteeing the obligation for ult
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PAST PERFORMANCE Conservative Balan
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Equity Portfolio Annual Returns (Cl
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Global Portfolio Annual Returns (Cl
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High Yield Bond Portfolio Annual Re
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Money Market Portfolio Annual Retur
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Small Capitalization Stock Portfoli
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Value Portfolio Annual Returns (Cla
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EXAMPLE The following Example, whic
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and are considered speculative. We
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can’t guarantee success, and it i
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■ ■ Repurchase agreements. The
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Government Income Portfolio The inv
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The Portfolio may also invest in ob
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unrated, of comparable quality in o
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■ Illiquid securities The Portfol
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MORE DETAILED INFORMATION ABOUT OTH
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are not backed by the full faith an
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HOW THE FUND IS MANAGED BOARD OF TR
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trading, asset management and priva
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Equity Portfolio Spiros “Sig” S
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Richard Piccirillo is Principal and
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Natural Resources Portfolio David A
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HOW TO BUY AND SELL SHARES OF THE P
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(which is generally 4:00 p.m. New Y
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DISTRIBUTOR Prudential Investment M
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FINANCIAL HIGHLIGHTS INTRODUCTION T
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Equity Portfolio Class I Year Ended
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High Yield Bond Portfolio Year Ende
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Small Capitalization Stock Portfoli
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INVESTOR INFORMATION SERVICES: Shar
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TABLE OF CONTENTS Page PER SHARE IN
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PER SHARE INVESTMENT INCOME, CAPITA
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Summary of Charges The Partnership
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Partnership. PREI's investment staf
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would be willing to commit to a fir
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The investment manager will manage
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4. Risks with Sale-Leaseback Transa
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If an account which has been alloca
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Page 113 and 114: NOTES TO THE FINANCIAL STATEMENTS O
Page 119 and 120: THE PRUDENTIAL VARIABLE CONTRACT RE
Page 127 and 128: NOTES TO THE CONSOLIDATED FINANCIAL
Page 139 and 140: Report of Independent Registered Pu
Page 141 and 142: Pruco Life Insurance Company Consol
Page 143 and 144: Pruco Life Insurance Company Consol
Page 145 and 146: Pruco Life Insurance Company Notes
Page 151: Pruco Life Insurance Company Notes
Page 185 and 186: Many Prudential Financial companies
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The Prudential Series Fund

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