Condensed Consolidating Financial Information (Tables)

9 Months Ended

Sep. 30, 2011

Condensed Consolidating Financial Information

Condensed Consolidating Financial Information, Notes Guarantor (Table)

Condensed Consolidating Statements of Financial Position

September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal Life Insurance Company Only			Principal Financial Services, Inc. and Other Subsidiaries Combined		Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Assets
Fixed maturities, available-for-sale	$	—		$	43,356.3		$	6,098.1	$	(384.9	)	$	49,069.5
Fixed maturities, trading	471.6			438.2			368.8		—			1,278.6
Equity securities, available-for-sale	—			116.8			3.7		—			120.5
Equity securities, trading	—			0.3			360.0		—			360.3
Mortgage loans	—			9,333.8			1,894.4		(367.8		)	10,860.4
Real estate	—			9.0			1,005.5		(1.3		)	1,013.2
Policy loans	—			859.2			24.3		—			883.5
Investment in unconsolidated entities	10,447.5			3,029.0			5,503.9		(18,075.7		)	904.7
Other investments	15.8			2,646.0			829.4		(1,193.1		)	2,298.1
Cash and cash equivalents	369.9			60.1			1,228.3		(224.1		)	1,434.2
Accrued investment income	2.6			597.1			67.1		(3.1		)	663.7
Premiums due and other receivables	22.6			1,044.2			695.5		(524.9		)	1,237.4
Deferred policy acquisition costs	—			2,975.9			269.6		—			3,245.5
Property and equipment	—			387.1			61.1		—			448.2
Goodwill	—			54.3			359.6		—			413.9
Other intangibles	—			29.6			843.2		—			872.8
Separate account assets	—			57,679.8			9,466.0		—			67,145.8
Other assets	18.9			649.0			916.1		(532.0		)	1,052.0
Total assets	$	11,348.9		$	123,265.7		$	29,994.6	$	(21,306.9	)	$	143,302.3
Liabilities
Contractholder funds	$	—		$	36,652.8		$	486.2	$	(264.0	)	$	36,875.0
Future policy benefits and claims	—			16,024.5			3,879.4		(82.0		)	19,821.9
Other policyholder funds	—			523.7			26.1		(0.1		)	549.7
Short-term debt	—			—			73.8		—			73.8
Long-term debt	1,351.7			99.4			516.0		(396.7		)	1,570.4
Income taxes currently payable	(19.8		)	(318.7		)	27.5		313.8			2.8
Deferred income taxes	(20.4		)	560.4			182.9		(15.0		)	707.9
Separate account liabilities	—			57,679.8			9,466.0		—			67,145.8
Other liabilities	57.1			4,022.8			4,575.7		(2,390.0		)	6,265.6
Total liabilities	1,368.6			115,244.7			19,233.6		(2,834.0		)	133,012.9
Stockholders’ equity
Series A preferred stock	—			—			—		—			—
Series B preferred stock	0.1			—			—		—			0.1
Common stock	4.5			2.5			—		(2.5		)	4.5
Additional paid-in capital	9,617.9			5,661.2			7,856.9		(13,518.1		)	9,617.9
Retained earnings	5,130.3			1,937.5			2,141.4		(4,078.9		)	5,130.3
Accumulated other comprehensive income	409.2			419.8			449.2		(869.0		)	409.2
Treasury stock, at cost	(5,181.7		)	—			—		—			(5,181.7		)
Total stockholders’ equity attributable to PFG	9,980.3			8,021.0			10,447.5		(18,468.5		)	9,980.3
Noncontrolling interest	—			—			313.5		(4.4		)	309.1
Total stockholders’ equity	9,980.3			8,021.0			10,761.0		(18,472.9		)	10,289.4
Total liabilities and stockholders’ equity	$	11,348.9		$	123,265.7		$	29,994.6	$	(21,306.9	)	$	143,302.3

Condensed Consolidating Statements of Financial Position

December 31, 2010

	Principal Financial Group, Inc. Parent Only			Principal Life Insurance Company Only			Principal Financial Services, Inc. and Other Subsidiaries Combined		Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Assets
Fixed maturities, available-for-sale	$	199.9		$	42,478.2		$	6,381.9	$	(423.7	)	$	48,636.3
Fixed maturities, trading	274.9			475.8			369.6		—			1,120.3
Equity securities, available-for-sale	—			165.8			4.1		—			169.9
Equity securities, trading	—			0.3			316.6		—			316.9
Mortgage loans	—			9,466.9			2,072.3		(414.1		)	11,125.1
Real estate	—			9.6			1,055.6		(1.7		)	1,063.5
Policy loans	—			878.3			25.6		—			903.9
Investment in unconsolidated entities	10,195.1			3,433.6			4,841.9		(17,734.6		)	736.0
Other investments	5.6			1,603.8			769.0		(472.8		)	1,905.6
Cash and cash equivalents	370.9			699.8			719.9		86.8			1,877.4
Accrued investment income	0.8			607.4			62.5		(4.6		)	666.1
Premiums due and other receivables	—			862.6			405.4		(205.0		)	1,063.0
Deferred policy acquisition costs	—			3,258.7			271.1		—			3,529.8
Property and equipment	—			389.6			69.1		—			458.7
Goodwill	—			54.3			291.1		—			345.4
Other intangibles	—			30.5			804.1		—			834.6
Separate account assets	—			62,738.4			6,816.9		—			69,555.3
Other assets	13.6			716.0			1,146.3		(552.6		)	1,323.3
Total assets	$	11,060.8		$	127,869.6		$	26,423.0	$	(19,722.3	)	$	145,631.1
Liabilities
Contractholder funds	$	—		$	37,353.3		$	208.9	$	(261.1	)	$	37,301.1
Future policy benefits and claims	—			16,082.5			4,013.3		(49.5		)	20,046.3
Other policyholder funds	—			569.2			23.0		—			592.2
Short-term debt	—			—			107.9		—			107.9
Long-term debt	1,351.7			99.5			581.0		(448.5		)	1,583.7
Income taxes currently payable	(18.8		)	(188.0		)	28.5		184.5			6.2
Deferred income taxes	(21.6		)	134.8			309.8		(13.1		)	409.9
Separate account liabilities	—			62,738.4			6,816.9		—			69,555.3
Other liabilities	21.7			3,264.6			3,977.1		(1,119.9		)	6,143.5
Total liabilities	1,333.0			120,054.3			16,066.4		(1,707.6		)	135,746.1
Stockholders’ equity
Series A preferred stock	—			—			—		—			—
Series B preferred stock	0.1			—			—		—			0.1
Common stock	4.5			2.5			—		(2.5		)	4.5
Additional paid-in capital	9,563.8			6,145.0			8,334.0		(14,479.0		)	9,563.8
Retained earnings	4,612.3			1,472.4			1,546.3		(3,018.7		)	4,612.3
Accumulated other comprehensive income	272.4			195.4			314.8		(510.2		)	272.4
Treasury stock, at cost	(4,725.3		)	—			—		—			(4,725.3		)
Total stockholders’ equity attributable to PFG	9,727.8			7,815.3			10,195.1		(18,010.4		)	9,727.8
Noncontrolling interest	—			—			161.5		(4.3		)	157.2
Total stockholders’ equity	9,727.8			7,815.3			10,356.6		(18,014.7		)	9,885.0
Total liabilities and stockholders’ equity	$	11,060.8		$	127,869.6		$	26,423.0	$	(19,722.3	)	$	145,631.1

Condensed Consolidating Statements of Operations

For the nine months ended September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal Life Insurance Company Only			Principal Financial Services, Inc. and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Revenues
Premiums and other considerations	$	—		$	1,993.2		$	228.5		$	—		$	2,221.7
Fees and other revenues	0.1			1,228.7			928.8			(226.7		)	1,930.9
Net investment income	1.5			1,961.1			562.7			23.7			2,549.0
Net realized capital gains (losses), excluding impairment losses on available-for-sale securities	—			482.0			(386.2		)	3.8			99.6
Total other-than-temporary impairment losses on available-for-sale securities	—			(51.8		)	(15.8		)	—			(67.6		)
Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to (from) other comprehensive income	—			(90.0		)	7.0			—			(83.0		)
Net impairment losses on available-for-sale securities	—			(141.8		)	(8.8		)	—			(150.6		)
Net realized capital gains (losses)	—			340.2			(395.0		)	3.8			(51.0		)
Total revenues	1.6			5,523.2			1,325.0			(199.2		)	6,650.6
Expenses
Benefits, claims and settlement expenses	—			2,904.6			442.4			(10.0		)	3,337.0
Dividends to policyholders	—			158.7			—			—			158.7
Operating expenses	86.4			1,643.7			822.8			(192.0		)	2,360.9
Total expenses	86.4			4,707.0			1,265.2			(202.0		)	5,856.6
Income (loss) before income taxes	(84.8		)	816.2			59.8			2.8			794.0
Income taxes (benefits)	(32.4		)	286.4			(38.1		)	(1.2		)	214.7
Equity in the net income (loss) of subsidiaries	595.1			(63.0		)	533.9			(1,066.0		)	—
Net income	542.7			466.8			631.8			(1,062.0		)	579.3
Net income attributable to noncontrolling interest	—			—			36.7			(0.1		)	36.6
Net income attributable to PFG	542.7			466.8			595.1			(1,061.9		)	542.7
Preferred stock dividends	24.7			—			—			—			24.7
Net income available to common stockholders	$	518.0		$	466.8		$	595.1		$	(1,061.9	)	$	518.0

Condensed Consolidating Statements of Operations
For the nine months ended September 30, 2010

	Principal Financial Group, Inc. Parent Only			Principal Life Insurance Company Only			Principal Financial Services, Inc. and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Revenues
Premiums and other considerations	$	—		$	2,396.5		$	216.0		$	—		$	2,612.5
Fees and other revenues	0.1			1,066.6			828.2			(209.0		)	1,685.9
Net investment income	30.9			2,110.2			455.1			24.1			2,620.3
Net realized capital gains (losses), excluding impairment losses on available-for-sale securities	0.7			235.2			(182.8		)	(2.4		)	50.7
Total other-than-temporary impairment losses on available-for-sale securities	—			(236.7		)	(10.9		)	—			(247.6		)
Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income	—			59.5			4.8			—			64.3
Net impairment losses on available-for-sale securities	—			(177.2		)	(6.1		)	—			(183.3		)
Net realized capital gains (losses)	0.7			58.0			(188.9		)	(2.4		)	(132.6		)
Total revenues	31.7			5,631.3			1,310.4			(187.3		)	6,786.1
Expenses
Benefits, claims and settlement expenses	—			3,566.5			379.2			(13.1		)	3,932.6
Dividends to policyholders	—			164.7			—			—			164.7
Operating expenses	87.5			1,454.0			746.4			(176.7		)	2,111.2
Total expenses	87.5			5,185.2			1,125.6			(189.8		)	6,208.5
Income (loss) before income taxes	(55.8		)	446.1			184.8			2.5			577.6
Income taxes (benefits)	(21.6		)	114.3			(14.0		)	(0.2		)	78.5
Equity in the net income (loss) of subsidiaries	525.9			(28.8		)	334.6			(831.7		)	—
Net income	491.7			303.0			533.4			(829.0		)	499.1
Net income attributable to noncontrolling interest	—			—			7.5			(0.1		)	7.4
Net income attributable to PFG	491.7			303.0			525.9			(828.9		)	491.7
Preferred stock dividends	24.7			—			—			—			24.7
Net income available to common stockholders	$	467.0		$	303.0		$	525.9		$	(828.9	)	$	467.0

Condensed Consolidating Statements of Cash Flows

For the nine months ended September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal LifeInsuranceCompany Only			Principal Financial Services, Inc. and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Operating activities
Net cash provided by (used in) operating activities	$	(249.2	)	$	1,983.6		$	447.8		$	(296.8	)	$	1,885.4
Investing activities
Available-for-sale securities:
Purchases	(4.4		)	(4,697.5		)	(480.4		)	2.9			(5,179.4		)
Sales	200.0			545.0			110.1			(9.5		)	845.6
Maturities	4.4			3,825.7			520.2			—			4,350.3
Mortgage loans acquired or originated	—			(989.0		)	(114.2		)	32.8			(1,070.4		)
Mortgage loans sold or repaid	—			1,106.6			242.1			(79.1		)	1,269.6
Real estate acquired	—			—			(43.8		)	—			(43.8		)
Net purchases of property and equipment	—			(27.0		)	(5.6		)	—			(32.6		)
Purchase of interests in subsidiaries, net of cash acquired	—			—			(206.9		)	—			(206.9		)
Dividends and returns of capital received from unconsolidated entities	506.3			224.4			506.4			(1,237.1		)	—
Net change in other investments	(0.2		)	(51.4		)	42.8			(12.7		)	(21.5		)
Net cash provided by (used in) investing activities	706.1			(63.2		)	570.7			(1,302.7		)	(89.1		)
Financing activities
Issuance of common stock	23.2			—			—			—			23.2
Acquisition of treasury stock	(456.4		)	—			—			—			(456.4		)
Proceeds from financing element derivatives	—			74.7			—			—			74.7
Payments for financing element derivatives	—			(38.6		)	—			—			(38.6		)
Excess tax benefits from share-based payment arrangements	—			0.8			1.2			—			2.0
Dividends to preferred stockholders	(24.7		)	—			—			—			(24.7		)
Issuance of long-term debt	—			—			2.6			—			2.6
Principal repayments of long-term debt	—			—			(55.8		)	51.5			(4.3		)
Net repayments of short-term borrowings	—			—			(30.7		)	—			(30.7		)
Dividends and capital paid to parent	—			(506.4		)	(730.7		)	1,237.1			—
Investment contract deposits	—			3,746.8			320.5			—			4,067.3
Investment contract withdrawals	—			(5,834.3		)	(2.0		)	—			(5,836.3		)
Net decrease in banking operation deposits	—			—			(15.2		)	—			(15.2		)
Other	—			(3.1		)	—			—			(3.1		)
Net cash used in financing activities	(457.9		)	(2,560.1		)	(510.1		)	1,288.6			(2,239.5		)
Net increase (decrease) in cash and cash equivalents	(1.0		)	(639.7		)	508.4			(310.9		)	(443.2		)
Cash and cash equivalents at beginning of year	370.9			699.8			719.9			86.8			1,877.4
Cash and cash equivalents at end of year	$	369.9		$	60.1		$	1,228.3		$	(224.1	)	$	1,434.2

Condensed Consolidating Statements of Cash Flows
For the nine months ended September 30, 2010

	Principal Financial Group, Inc. Parent Only			Principal Life Insurance Company Only			Principal Financial Services, Inc. and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Operating activities
Net cash provided by (used in) operating activities	$	(177.4	)	$	1,769.8		$	631.1		$	(294.0	)	$	1,929.5
Investing activities
Available-for-sale securities:
Purchases	(61.3		)	(4,319.0		)	(846.6		)	0.4			(5,226.5		)
Sales	95.5			1,070.1			248.9			(40.4		)	1,374.1
Maturities	81.1			3,079.4			447.9			—			3,608.4
Mortgage loans acquired or originated	—			(680.0		)	(206.1		)	223.7			(662.4		)
Mortgage loans sold or repaid	—			1,132.9			299.2			(193.4		)	1,238.7
Real estate acquired	—			(0.2		)	(23.6		)	—			(23.8		)
Net purchases of property and equipment	—			(0.7		)	(10.7		)	—			(11.4		)
Dividends and returns of capital received from unconsolidated entities	301.6			193.8			301.6			(797.0		)	—
Net change in other investments	13.3			(19.9		)	(116.2		)	131.6			8.8
Net cash provided by investing activities	430.2			456.4			94.4			(675.1		)	305.9
Financing activities
Issuance of common stock	20.0			—			—			—			20.0
Acquisition of treasury stock	(2.3		)	—			—			—			(2.3		)
Proceeds from financing element derivatives	—			78.6			—			—			78.6
Payments for financing element derivatives	—			(36.2		)	—			—			(36.2		)
Excess tax benefits from share-based payment arrangements	—			0.3			0.5			—			0.8
Dividends to preferred stockholders	(24.7		)	—			—			—			(24.7		)
Issuance of long-term debt	—			—			26.9			(25.2		)	1.7
Principal repayments of long-term debt	—			—			(8.9		)	—			(8.9		)
Net proceeds from (repayments of) short-term borrowings	—			—			(5.0		)	32.1			27.1
Dividends and capital paid to parent	—			(301.6		)	(495.4		)	797.0			—
Investment contract deposits	—			2,916.0			99.7			—			3,015.7
Investment contract withdrawals	—			(5,311.6		)	—			—			(5,311.6		)
Net increase in banking operation deposits	—			—			36.0			—			36.0
Other	—			(3.2		)	—			—			(3.2		)
Net cash used in financing activities	(7.0		)	(2,657.7		)	(346.2		)	803.9			(2,207.0		)
Net increase (decrease) in cash and cash equivalents	245.8			(431.5		)	379.3			(165.2		)	28.4
Cash and cash equivalents at beginning of period	304.6			1,249.2			713.0			(26.4		)	2,240.4
Cash and cash equivalents at end of period	$	550.4		$	817.7		$	1,092.3		$	(191.6	)	$	2,268.8

Condensed Consolidating Financial Information, Shelf Registration Guarantor (Table)

Condensed Consolidating Statements of Financial Position
September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Assets
Fixed maturities, available-for-sale	$	—		$	—		$	49,069.5		$	—		$	49,069.5
Fixed maturities, trading	471.6			—			807.0			—			1,278.6
Equity securities, available-for-sale	—			—			120.5			—			120.5
Equity securities, trading	—			—			360.3			—			360.3
Mortgage loans	—			—			10,860.4			—			10,860.4
Real estate	—			—			1,013.2			—			1,013.2
Policy loans	—			—			883.5			—			883.5
Investment in unconsolidated entities	10,447.5			10,627.5			904.7			(21,075.0		)	904.7
Other investments	15.8			42.2			2,240.1			—			2,298.1
Cash and cash equivalents	369.9			548.0			1,545.3			(1,029.0		)	1,434.2
Accrued investment income	2.6			—			661.1			—			663.7
Premiums due and other receivables	22.6			—			1,214.7			0.1			1,237.4
Deferred policy acquisition costs	—			—			3,245.5			—			3,245.5
Property and equipment	—			—			448.2			—			448.2
Goodwill	—			—			413.9			—			413.9
Other intangibles	—			—			872.8			—			872.8
Separate account assets	—			—			67,145.8			—			67,145.8
Other assets	18.9			9.8			1,028.3			(5.0		)	1,052.0
Total assets	$	11,348.9		$	11,227.5		$	142,834.8		$	(22,108.9	)	$	143,302.3
Liabilities
Contractholder funds	$	—		$	—		$	36,875.0		$	—		$	36,875.0
Future policy benefits and claims	—			—			19,821.9			—			19,821.9
Other policyholder funds	—			—			549.7			—			549.7
Short-term debt	—			48.0			323.8			(298.0		)	73.8
Long-term debt	1,351.7			—			218.7			—			1,570.4
Income taxes currently payable	(19.8		)	(1.2		)	9.7			14.1			2.8
Deferred income taxes	(20.4		)	(2.8		)	748.4			(17.3		)	707.9
Separate account liabilities	—			—			67,145.8			—			67,145.8
Other liabilities	57.1			736.0			6,205.2			(732.7		)	6,265.6
Total liabilities	1,368.6			780.0			131,898.2			(1,033.9		)	133,012.9
Stockholders’ equity
Series A preferred stock	—			—			—			—			—
Series B preferred stock	0.1			—			—			—			0.1
Common stock	4.5			—			17.8			(17.8		)	4.5
Additional paid-in capital	9,617.9			7,856.9			7,480.1			(15,337.0		)	9,617.9
Retained earnings	5,130.3			2,141.4			2,665.5			(4,806.9		)	5,130.3
Accumulated other comprehensive income	409.2			449.2			466.1			(915.3		)	409.2
Treasury stock, at cost	(5,181.7		)	—			(2.0		)	2.0			(5,181.7		)
Total stockholders’ equity attributable to PFG	9,980.3			10,447.5			10,627.5			(21,075.0		)	9,980.3
Noncontrolling interest	—			—			309.1			—			309.1
Total stockholders’ equity	9,980.3			10,447.5			10,936.6			(21,075.0		)	10,289.4
Total liabilities and stockholders’ equity	$	11,348.9		$	11,227.5		$	142,834.8		$	(22,108.9	)	$	143,302.3

Condensed Consolidating Statements of Financial Position
December 31, 2010

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Assets
Fixed maturities, available-for-sale	$	199.9		$	—		$	48,436.4		$	—		$	48,636.3
Fixed maturities, trading	274.9			—			845.4			—			1,120.3
Equity securities, available-for-sale	—			—			169.9			—			169.9
Equity securities, trading	—			—			316.9			—			316.9
Mortgage loans	—			—			11,125.1			—			11,125.1
Real estate	—			—			1,063.5			—			1,063.5
Policy loans	—			—			903.9			—			903.9
Investment in unconsolidated entities	10,195.1			10,209.0			735.8			(20,403.9		)	736.0
Other investments	5.6			45.5			1,854.5			—			1,905.6
Cash and cash equivalents	370.9			519.7			1,821.7			(834.9		)	1,877.4
Accrued investment income	0.8			—			665.3			—			666.1
Premiums due and other receivables	—			—			1,066.1			(3.1		)	1,063.0
Deferred policy acquisition costs	—			—			3,529.8			—			3,529.8
Property and equipment	—			—			458.7			—			458.7
Goodwill	—			—			345.4			—			345.4
Other intangibles	—			—			834.6			—			834.6
Separate account assets	—			—			69,555.3			—			69,555.3
Other assets	13.6			9.8			1,302.4			(2.5		)	1,323.3
Total assets	$	11,060.8		$	10,784.0		$	145,030.7		$	(21,244.4	)	$	145,631.1
Liabilities
Contractholder funds	$	—		$	—		$	37,301.1		$	—		$	37,301.1
Future policy benefits and claims	—			—			20,046.3			—			20,046.3
Other policyholder funds	—			—			592.2			—			592.2
Short-term debt	—			50.0			352.3			(294.4		)	107.9
Long-term debt	1,351.7			—			232.0			—			1,583.7
Income taxes currently payable	(18.8		)	(2.3		)	11.6			15.7			6.2
Deferred income taxes	(21.6		)	(8.7		)	455.7			(15.5		)	409.9
Separate account liabilities	—			—			69,555.3			—			69,555.3
Other liabilities	21.7			549.9			6,118.0			(546.1		)	6,143.5
Total liabilities	1,333.0			588.9			134,664.5			(840.3		)	135,746.1
Stockholders’ equity
Series A preferred stock	—			—			—			—			—
Series B preferred stock	0.1			—			—			—			0.1
Common stock	4.5			—			17.8			(17.8		)	4.5
Additional paid-in capital	9,563.8			8,334.0			7,730.0			(16,064.0		)	9,563.8
Retained earnings	4,612.3			1,546.3			2,142.4			(3,688.7		)	4,612.3
Accumulated other comprehensive income	272.4			314.8			320.8			(635.6		)	272.4
Treasury stock, at cost	(4,725.3		)	—			(2.0		)	2.0			(4,725.3		)
Total stockholders’ equity attributable to PFG	9,727.8			10,195.1			10,209.0			(20,404.1		)	9,727.8
Noncontrolling interest	—			—			157.2			—			157.2
Total stockholders’ equity	9,727.8			10,195.1			10,366.2			(20,404.1		)	9,885.0
Total liabilities and stockholders’ equity	$	11,060.8		$	10,784.0		$	145,030.7		$	(21,244.4	)	$	145,631.1

Condensed Consolidating Statements of Operations

For the nine months ended September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Revenues
Premiums and other considerations	$	—		$	—		$	2,221.7		$	—		$	2,221.7
Fees and other revenues	0.1			—			1,933.6			(2.8		)	1,930.9
Net investment income (loss)	1.5			(3.2		)	2,547.9			2.8			2,549.0
Net realized capital gains (losses), excluding impairment losses on available-for-sale securities	—			(0.1		)	99.7			—			99.6
Total other-than-temporary impairment losses on available-for-sale securities	—			—			(67.6		)	—			(67.6		)
Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified from other comprehensive income	—			—			(83.0		)	—			(83.0		)
Net impairment losses on available-for-sale securities	—			—			(150.6		)	—			(150.6		)
Net realized capital losses	—			(0.1		)	(50.9		)	—			(51.0		)
Total revenues	1.6			(3.3		)	6,652.3			—			6,650.6
Expenses
Benefits, claims and settlement expenses	—			—			3,337.0			—			3,337.0
Dividends to policyholders	—			—			158.7			—			158.7
Operating expenses	86.4			1.2			2,273.3			—			2,360.9
Total expenses	86.4			1.2			5,769.0			—			5,856.6
Income (loss) before income taxes	(84.8		)	(4.5		)	883.3			—			794.0
Income taxes (benefits)	(32.4		)	(8.3		)	255.4			—			214.7
Equity in the net income of subsidiaries	595.1			591.3			—			(1,186.4		)	—
Net income	542.7			595.1			627.9			(1,186.4		)	579.3
Net income attributable to noncontrolling interest	—			—			36.6			—			36.6
Net income attributable to PFG	542.7			595.1			591.3			(1,186.4		)	542.7
Preferred stock dividends	24.7			—			—			—			24.7
Net income available to common stockholders	$	518.0		$	595.1		$	591.3		$	(1,186.4	)	$	518.0

Condensed Consolidating Statements of Operations
For the nine months ended September 30, 2010

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Revenues
Premiums and other considerations	$	—		$	—		$	2,612.5		$	—		$	2,612.5
Fees and other revenues	0.1			—			1,686.4			(0.6		)	1,685.9
Net investment income (loss)	30.9			(2.6		)	2,591.5			0.5			2,620.3
Net realized capital gains (losses), excluding impairment losses on available-for-sale securities	0.7			(0.1		)	50.1			—			50.7
Total other-than-temporary impairment losses on available-for-sale securities	—			—			(247.6		)	—			(247.6		)
Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to other comprehensive income	—			—			64.3			—			64.3
Net impairment losses on available-for-sale securities	—			—			(183.3		)	—			(183.3		)
Net realized capital gains (losses)	0.7			(0.1		)	(133.2		)	—			(132.6		)
Total revenues	31.7			(2.7		)	6,757.2			(0.1		)	6,786.1
Expenses
Benefits, claims and settlement expenses	—			—			3,932.6			—			3,932.6
Dividends to policyholders	—			—			164.7			—			164.7
Operating expenses	87.5			0.8			2,023.0			(0.1		)	2,111.2
Total expenses	87.5			0.8			6,120.3			(0.1		)	6,208.5
Income (loss) before income taxes	(55.8		)	(3.5		)	636.9			—			577.6
Income taxes (benefits)	(21.6		)	0.4			99.7			—			78.5
Equity in the net income of subsidiaries	525.9			529.8			—			(1,055.7		)	—
Net income	491.7			525.9			537.2			(1,055.7		)	499.1
Net income attributable to noncontrolling interest	—			—			7.4			—			7.4
Net income attributable to PFG	491.7			525.9			529.8			(1,055.7		)	491.7
Preferred stock dividends	24.7			—			—			—			24.7
Net income available to common stockholders	$	467.0		$	525.9		$	529.8		$	(1,055.7	)	$	467.0

Condensed Consolidating Statements of Cash Flows

For the nine months ended September 30, 2011

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Operating activities
Net cash provided by (used in) operating activities	$	(249.2	)	$	186.6		$	2,138.5		$	(190.5	)	$	1,885.4
Investing activities
Available-for-sale securities:
Purchases	(4.4		)	—			(5,175.0		)	—			(5,179.4		)
Sales	200.0			—			645.6			—			845.6
Maturities	4.4			—			4,345.9			—			4,350.3
Mortgage loans acquired or originated	—			—			(1,070.4		)	—			(1,070.4		)
Mortgage loans sold or repaid	—			—			1,269.6			—			1,269.6
Real estate acquired	—			—			(43.8		)	—			(43.8		)
Net purchases of property and equipment	—			—			(32.6		)	—			(32.6		)
Purchase of interests in subsidiaries, net of cash acquired	—			—			(206.9		)	—			(206.9		)
Dividends and returns of capital received from unconsolidated entities	506.3			346.8			—			(853.1		)	—
Net change in other investments	(0.2		)	3.2			(24.5		)	—			(21.5		)
Net cash provided by (used in) investing activities	706.1			350.0			(292.1		)	(853.1		)	(89.1		)
Financing activities
Issuance of common stock	23.2			—			—			—			23.2
Acquisition of treasury stock	(456.4		)	—			—			—			(456.4		)
Proceeds from financing element derivatives	—			—			74.7			—			74.7
Payments for financing element derivatives	—			—			(38.6		)	—			(38.6		)
Excess tax benefits from share-based payment arrangements	—			—			2.0			—			2.0
Dividends to preferred stockholders	(24.7		)	—			—			—			(24.7		)
Issuance of long-term debt	—			—			2.6			—			2.6
Principal repayments of long-term debt	—			—			(4.3		)	—			(4.3		)
Net repayments of short-term borrowings	—			(2.0		)	(25.1		)	(3.6		)	(30.7		)
Dividends and capital paid to parent	—			(506.3		)	(346.8		)	853.1			—
Investment contract deposits	—			—			4,067.3			—			4,067.3
Investment contract withdrawals	—			—			(5,836.3		)	—			(5,836.3		)
Net decrease in banking operation deposits	—			—			(15.2		)	—			(15.2		)
Other	—			—			(3.1		)	—			(3.1		)
Net cash used in financing activities	(457.9		)	(508.3		)	(2,122.8		)	849.5			(2,239.5		)
Net increase (decrease) in cash and cash equivalents	(1.0		)	28.3			(276.4		)	(194.1		)	(443.2		)
Cash and cash equivalents at beginning of year	370.9			519.7			1,821.7			(834.9		)	1,877.4
Cash and cash equivalents at end of year	$	369.9		$	548.0		$	1,545.3		$	(1,029.0	)	$	1,434.2

Condensed Consolidating Statements of Cash Flows
For the nine months ended September 30, 2010

	Principal Financial Group, Inc. Parent Only			Principal Financial Services, Inc. Only			Principal Life Insurance Company and Other Subsidiaries Combined			Eliminations			Principal Financial Group, Inc. Consolidated
	(in millions)
Operating activities
Net cash provided by (used in) operating activities	$	(177.4	)	$	96.8		$	2,103.4		$	(93.3	)	$	1,929.5
Investing activities
Available-for-sale securities:
Purchases	(61.3		)	—			(5,165.2		)	—			(5,226.5		)
Sales	95.5			—			1,278.6			—			1,374.1
Maturities	81.1			—			3,527.3			—			3,608.4
Mortgage loans acquired or originated	—			—			(662.4		)	—			(662.4		)
Mortgage loans sold or repaid	—			—			1,238.7			—			1,238.7
Real estate acquired	—			—			(23.8		)	—			(23.8		)
Net purchases of property and equipment	—			—			(11.4		)	—			(11.4		)
Dividends and returns of capital received from unconsolidated entities	301.6			321.6			—			(623.2		)	—
Net change in other investments	13.3			22.3			6.5			(33.3		)	8.8
Net cash provided by investing activities	430.2			343.9			188.3			(656.5		)	305.9
Financing activities
Issuance of common stock	20.0			—			—			—			20.0
Acquisition of treasury stock	(2.3		)	—			—			—			(2.3		)
Proceeds from financing element derivatives	—			—			78.6			—			78.6
Payments for financing element derivatives	—			—			(36.2		)	—			(36.2		)
Excess tax benefits from share-based payment arrangements	—			—			0.8			—			0.8
Dividends to preferred stockholders	(24.7		)	—			—			—			(24.7		)
Issuance of long-term debt	—			—			1.7			—			1.7
Principal repayments of long-term debt	—			—			(8.9		)	—			(8.9		)
Net proceeds from short-term borrowings	—			—			58.6			(31.5		)	27.1
Dividends and capital paid to parent	—			(301.6		)	(321.6		)	623.2			—
Investment contract deposits	—			—			3,015.7			—			3,015.7
Investment contract withdrawals	—			—			(5,311.6		)	—			(5,311.6		)
Net increase in banking operation deposits	—			—			36.0			—			36.0
Other	—			—			(3.2		)	—			(3.2		)
Net cash used in financing activities	(7.0		)	(301.6		)	(2,490.1		)	591.7			(2,207.0		)
Net increase (decrease) in cash and cash equivalents	245.8			139.1			(198.4		)	(158.1		)	28.4
Cash and cash equivalents at beginning of period	304.6			534.4			2,256.8			(855.4		)	2,240.4
Cash and cash equivalents at end of period	$	550.4		$	673.5		$	2,058.4		$	(1,013.5	)	$	2,268.8