-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H3u+Q58OuD5Nx7iAD2BwtHQnH1b0NTLPMGTj4WfnqVZiBYjACC64myD4W/2KPtSC W7/FDWSqv6dcQhwcVi3zYw== 0000950130-98-004416.txt : 19980909 0000950130-98-004416.hdr.sgml : 19980909 ACCESSION NUMBER: 0000950130-98-004416 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980908 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTENNIAL TAX EXEMPT TRUST /CO/ CENTRAL INDEX KEY: 0000319880 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 222328954 STATE OF INCORPORATION: MA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-03104 FILM NUMBER: 98705178 BUSINESS ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY STREET 2: 34TH FLOOR CITY: ENGLEWOOD STATE: CO ZIP: 80112 BUSINESS PHONE: 303-768-3200 FORMER COMPANY: FORMER CONFORMED NAME: DAILY CASH TAX EXEMPT FUND INC DATE OF NAME CHANGE: 19851009 FORMER COMPANY: FORMER CONFORMED NAME: CENTENNIAL TAX EXEMPT CASH FUND INC DATE OF NAME CHANGE: 19820720 FORMER COMPANY: FORMER CONFORMED NAME: DAILY TAX EXEMPT CASH FUND INC DATE OF NAME CHANGE: 19811027 N-30D 1 CENTENNIAL TAX EXEMPT TRUST A/R 06/30/1998 DEAR SHAREHOLDER: In a year of excitement and volatility for stock markets here and abroad, tax- exempt money market funds, such as Centennial Tax Exempt Trust, generally continued to provide relatively stable returns. True, the supply of and demand for tax-exempt securities are variable, causing fluctuations in yield on a month-to-month basis. Nevertheless, the overall pattern of tax-exempt yields generally tends to track the actions of the Federal Reserve Board, which raises and lowers short-term interest rates based on its view of inflation. Because the Fed stayed on the sidelines for the entire fiscal year, tax-exempt yields remained relatively unchanged. Two opposing forces have kept the Fed from raising or lowering rates. On one hand, the U.S. economy continues to grow at a strong pace, with the unemployment rate at just 4.5% and consumer confidence soaring. On the other hand, the Asian financial crisis shows no signs of easing, which has weakened global demand for goods and services. Since the United States is a major exporter to Asia, slackening demand and devalued currencies in the Far East have created a dampening effect on inflation. Remarkably, seven years into an economic expansion, U.S. inflation is now trending below 2%. For the fiscal year ended June 30, 1998, the Centennial Tax Exempt Trust produced a compounded annual yield of 3.12%. Without compounding, the corresponding yield was 3.07%. For investors in the 36% Federal tax bracket, this is equivalent to a taxable yield of 4.88% with compounding, and 4.80% without. On June 30, 1998, the seven-day annualized yields, with and without compounding, were 3.00% and 2.95%, respectively./1/ It is important to remember that an investment in the Trust is neither insured nor guaranteed by the U.S. government, and there is no assurance that the Trust will maintain a stable $1.00 share price in the future. Generally speaking, securities that mature in several months pay higher yields than those maturing within days or weeks. The reason is that the issuer needs to compensate the investor for the risk that future inflation could trigger higher interest rates, which would create more-attractive investment opportunities. However, 1. Compounded yields assume reinvestment of dividends. Past performance is not indicative of future results. because of today's very low inflationary environment, tax-exempt money market securities with longer maturities have not offered much extra yield. During the rest of 1998 and beyond, we plan to continue monitoring global events so that we can position the portfolio accordingly. If the Asian crisis diminishes and the U.S. economy continues growing, then we would expect the Federal Reserve Board to raise short-term interest rates to keep inflation in check. In that event, we would keep the portfolio's maturity fairly short to allow us to reinvest at higher yields. However, if the U.S. economy should begin to slow and the Fed appears likely to lower short-term interest rates, then we would lengthen the portfolio's maturity to lock in higher yields. In either case, we will continue to invest conservatively, always keeping in mind your objectives of safety and liquidity. Thank you for your confidence in Centennial Tax Exempt Trust. We look forward to helping you reach your investment goals, part of our commitment to you as The Right Way to Invest. Sincerely, /s/ James C. Swain James C. Swain Chairman Centennial Tax Exempt Trust /s/ Bridget A. Macaskill Bridget A. Macaskill President Centennial Tax Exempt Trust July 22, 1998 2 STATEMENT OF INVESTMENTS June 30, 1998 Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ SHORT-TERM TAX-EXEMPT OBLIGATIONS--99.0% ALABAMA--0.3% Boaz, AL IDV Board RRB, Parker Hannifin Corp., 3.55%(/1/).......................................... $ 5,935,000 $ 5,935,000 ------------ ARIZONA--3.0% AZ HFAU RB, Blood Systems, Inc., 3.60%(/1/).......... 8,935,000 8,935,000 Maricopa Cnty.: AZ IDAU SWD RB, Rainbow Valley Landfill Project, Series A, 4%, 12/1/98(/2/)......................... 4,000,000 4,000,000 AZ PC RRB, Arizona Public Service Co., Series B, 3.80%(/1/)......................................... 11,200,000 11,200,000 Phoenix, AZ IDAU MH RRB: Lynwood Apts. Project, 3.55%(/1/)................... 6,475,000 6,475,000 Paradise Lakes Apts. Project, 1995 Series, 3.70%(/1/)......................................... 22,500,000 22,500,000 Tucson, AZ IDAU RB, Geronimo Building Renovation Project, 4%, 12/15/98............................... 1,005,000 1,005,000 ------------ 54,115,000 ------------ ARKANSAS--0.0% Subiaco, AR IDV RB, Cloves Gear & Products, Inc., 3.80%(/1/).......................................... 135,000 135,000 ------------ CALIFORNIA--4.7% Anaheim, CA HAU MH RRB, Park Vista Apts., Series A, 3.50%(/1/).......................................... 1,000,000 1,000,000 CA CDAU Apartment Development RRB, Whispering Winds Apts., Series D, 3.55%(/1/)......................... 2,500,000 2,500,000 CA EDFAU RB, CA Independent System Project: Series B, 3.40%(/1/)................................ 3,500,000 3,500,000 Series D, 3.50%(/1/)................................ 9,500,000 9,500,000 CA GOB Tendered Option Certificates, Series 1998A, MBIA Insured, 4%(/1/)............................... 6,615,000 6,615,000 CA HEAU RRB, Series D-1, 3.80%, 8/1/98 .............. 3,900,000 3,900,000 CA HEAU Student Loan RB, Series C, 3.65%(/1/)........ 4,000,000 4,000,000 CA HFA RB, Series C, 3.55%, 2/1/99................... 1,255,000 1,255,000 CA HFFAU RB: Pooled Loan Program, Series B, FGIC Insured, 3.10%(/1/)......................................... 500,000 500,000 Scripps Memorial Hospital, Series A, MBIA Insured, 3.25%(/1/)......................................... 320,000 320,000 CA Municipal RB, Series SG89, MBIA Insured, 3.60%(/1/).......................................... 7,425,000 7,425,000 CA PCFAU RRB, Pacific Gas & Electric, Series C, 3.35%(/1/).......................................... 4,900,000 4,900,000 CA PCFAU SWD RR RB, Shell Martinez Refining, Series A, 3.40%(/1/)....................................... 3,900,000 3,900,000 CA Statewide CDC RB, Fibrebond, Inc., 3.40%(/1/)..... 2,000,000 1,999,980 Huntington Park, CA RA MH RB, Casa Rita Apts., Series A, 3.35%(/1/)....................................... 1,100,000 1,100,000 Los Angeles, CA Airport RB, Series SG61, 3.63%(/1/).. 1,055,000 1,055,000 Modesto, CA Irrigation District FAU RB, Series SG66, 3.58%(/1/).......................................... 500,000 500,000 Northern CA PPA RRB, Geothermal Project 3-A, 3.10%(/1/).......................................... 2,000,000 2,000,024
3 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ CALIFORNIA (CONTINUED) Oceanside, CA MH RRB, Lakeridge Apts. Project, 3.80%(/1/).......................................... $ 3,000,000 $ 3,000,000 Orange Cnty., CA Sanitation District COP, FGIC Insured, 3.50%(/1/)................................. 9,800,000 9,800,000 Pittsburg, CA Mortgage Obligation RRB, Series A, 3.61%(/1/).......................................... 4,470,000 4,470,000 San Diego Cnty., CA Tax & RAN, 4.50%, 9/30/98........ 9,000,000 9,011,045 San Francisco, CA City & Cnty. Redevelopment FAU RRB, Yerba Buena Garden, 3.20%(/1/)...................... 415,000 415,000 Southern CA Metropolitan Water District Waterworks RRB, Series A, AMBAC Insured, 3%(/1/)............... 1,000,000 999,976 Southern CA PAU RRB, Palo Verde Project, Series B, AMBAC Insured, 3.10%(/1/)........................... 2,400,000 2,400,000 ------------ 86,066,025 ------------ COLORADO--2.9% Arapahoe Cnty., CO MH RRB, Hunters Run Rental Housing, 3.75%(/1/)................................. 25,600,000 25,600,000 Aurora, CO IDV RRB, La Quinta Motor Inns, Inc., 3.65%(/1/).......................................... 2,400,000 2,400,000 CO Housing FAU RRB, Loretto MH, Series F, 3.55%(/1/).......................................... 9,100,000 9,100,000 Denver, CO City & Cnty. MH RRB, Parliament Apts. Project, 3.75%(/1/)................................. 10,000,000 10,000,000 Superior Metropolitan District No. 3, CO GOB, 3.60%(/1/).......................................... 5,000,000 5,000,000 Wheat Ridge, CO IDV RRB, La Quinta Motor Inns, Inc., 3.65%(/1/).......................................... 1,525,000 1,525,000 ------------ 53,625,000 ------------ DELAWARE--0.3% DE EDAU RB, Hospital Billing Project, Series A, BIG Insured, 3.75%(/1/)................................. 6,100,000 6,100,000 ------------ FLORIDA--7.3% Dade Cnty., FL WSS RB, FGIC Insured, 3.70%, 7/1/98(/2/)......................................... 9,500,000 9,500,000 Escambia Cnty., FL HFAU RRB, Florida Convertible Centers Project, Series A, 3.70%(/1/)............... 1,200,000 1,200,000 FL BOE Capital Outlay Public Education Refunding Bonds, Series A, 3.74%(/1/)......................... 13,230,000 13,230,000 FL HFA MH RRB, Monterey Lake Project, 3.55%(/1/)..... 19,965,000 19,965,000 FL Turnpike Authority RB, Series A, FGIC Insured, 3.70%, 7/1/98(/2/).................................. 14,200,000 14,200,000 Hillsboro Cnty., FL IDV PC RB, Tampa Electric Co., MBIA Insured, 3.70%, 1/15/99(/2/)................... 35,590,000 35,590,000 Jacksonville, FL IDV RRB, Airport Hotel Project, 3.55%(/1/).......................................... 3,000,000 3,000,000 Jacksonville, FL PC RRB, Florida Power & Light Co. Project, 4.10%(/1/)................................. 10,000,000 10,000,000 Manatee Cnty., FL PC RRB, Florida Power & Light Co. Project, 3.75%(/1/)................................. 4,610,000 4,610,000 Orange Cnty., FL Housing FAU MH RRB, Monterey Project, Series B, 3.80%(/1/)....................... 4,740,000 4,740,000
4 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ FLORIDA (CONTINUED) St. Lucie Cnty., FL PC RRB, Florida Power & Light Co. Project, 4.10%(/1/).................................. $ 9,000,000 $ 9,000,000 Tampa, FL Occupational License Tax RRB, Series A, FGIC Insured, 3.50%(/1/).................................. 7,600,000 7,600,000 ------------ 132,635,000 ------------ GEORGIA--9.3% Atlanta, GA Urban Residential FAU MH RB, New Community East Lake Project, 3.70%(/1/)........................ 2,000,000 2,000,000 Burke Cnty., GA DAU PC RB, Oglethorpe Power Corp., Series A, FGIC Insured, 3.35%(/1/)................... 5,100,000 5,100,000 Cobb Cnty., GA HAU MH RRB, Terrell Mill Project, 3.70%(/1/)(/3/)...................................... 9,400,000 9,400,000 De Kalb Cnty., GA Tax Anticipation Nts., 4%, 12/31/98............................................. 40,000,000 40,103,830 Fulton Cnty., GA DAU RB: Georgia Tech Athletic Assn., Inc., 3.60%(/1/)........ 3,000,000 3,000,000 Lovett School Project, 3.60%(/1/).................... 3,000,000 3,000,000 Robert W. Woodruff Arts Project, 3.60%(/1/).......... 2,000,000 2,000,000 Fulton Cnty., GA Residential Care Facilities RB, Canterbury Court Project, Series A, 3.60%(/1/)....... 2,255,000 2,255,000 GA GOB, Series 1995B, 3.68%(/1/)...................... 11,400,000 11,400,000 Gainesville, GA RA RB, Riverside Military Academy, 3.90%(/1/)........................................... 10,000,000 10,000,000 Gwinnett Cnty., GA SDI, Construction Sales Tax Nts., 4%, 12/31/98......................................... 54,725,000 54,850,185 Richmond Cnty., GA DAU PC RRB, Monsanto Co. Project, 3.55%(/1/)........................................... 4,000,000 4,000,000 Roswell, GA HAU MH RRB, Oxford Project, 3.70%(/1/).... 23,610,000 23,610,000 ------------ 170,719,015 ------------ IDAHO--0.1% Custer Cnty., ID IDV SWD RB, Hecla Mining Co. Project, 3.75%(/1/)........................................... 1,000,000 1,000,000 ------------ ILLINOIS--7.9% ABN AMRO Munitops Certificates/Chicago, IL, Trust 1998-3, 3.80%(/1/)(/3/).............................. 8,735,000 8,735,000 Centralia City, IL IDV RB, Consolidated Foods Corp./Hollywood Brands, Inc., 3.55%(/1/)............. 5,500,000 5,500,000 Chicago, IL Tendered Nts., 3.55%, 1/31/99(/2/)........ 6,600,000 6,600,000 Elk Grove Village, IL IDV RB, La Quinta Motor Inns, Inc., 3.75%(/1/)..................................... 2,700,000 2,700,000 IL Development FAU RB, Residential Brookdale Project, 3.65%(/1/)........................................... 14,800,000 14,800,000 IL Educational FA RB, National-Louis University, 3.45%(/1/)........................................... 6,200,000 6,200,000 IL HFAU RB, Lake Forest Hospital Project, 4.25%(/1/).. 11,375,000 11,375,000 IL HFAU RRB: Advocate Health Care, Series B, 3.55%(/1/)........... 36,940,000 36,940,000 Swedish Covenant, Series A, AMBAC Insured, 3.55%(/1/).......................................... 9,800,000 9,800,000
5 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ ILLINOIS (CONTINUED) IL IDAU RRB, SuperValu Stores, Inc. Project, 3.55%(/1/).......................................... $ 5,000,000 $ 5,000,000 IL Student Assistance Commission Student Loan RB, Series A, 3.65%(/1/)................................ 13,200,000 13,200,000 Lakemoor Village, IL MH Mtg. RB, Lakemoor Apts. Project, Series A, 4.20%, 9/1/98.................... 4,662,536 4,662,536 Madison Cnty., IL Environmental Improvement RB, Shell Wood River Project, Series A, 3.90%(/1/)............ 11,100,000 11,100,000 University, IL University RB, HCF Services, Series B, 3.50%(/1/).......................................... 5,000,000 5,000,000 West Chicago, IL IDV RRB, Liquid Container Project, 3.60%(/1/).......................................... 3,810,000 3,810,000 ------------ 145,422,536 ------------ INDIANA--3.8% Crawfordsville, IN ED RRB, Pedcor Investments-Shady Knoll Apts. Project, 3.65%(/1/)..................... 3,395,000 3,395,000 Dyer, IN HCF RRB, Regency Place, Series A-1, 3.75%(/1/).......................................... 3,360,000 3,360,000 Fort Wayne, IN HCF RRB, Health Quest, Series X-A, 3.75%(/1/).......................................... 3,325,000 3,325,000 Gary, IN Industrial Environmental Improvement RB, U.S. Steel Corp. Project, 3.70%(/1/)................ 1,000,000 1,000,000 Greenfield, IN Industrial ED RRB, 3.60%(/1/)......... 1,090,000 1,090,000 Greenwood, IN Industrial ED RRB, 3.60%(/1/).......... 1,100,000 1,100,000 Hobart, IN ED RRB, MMM Invest, Inc. Project, 3.60%(/1/).......................................... 1,535,000 1,535,000 IN Development FAU RB, Brebeuf Prep School, 3.60%(/1/).......................................... 3,500,000 3,500,000 IN EDFAU RB, Saroyan Hardwoods, Inc., 3.70%(/1/)..... 1,850,000 1,850,000 IN HFFAU RRB, Sisters of St. Francis Health, Series A, MBIA Insured, 5%, 11/1/98........................ 1,000,000 1,003,586 IN MPA RB, Power Supply System, MBIA Insured, 3.61%, 7/1/98.............................................. 13,600,000 13,600,000 Indianapolis, IN HCF RRB, Health Quest, Series A, 3.75%(/1/).......................................... 4,045,000 4,045,000 Marion Cnty., IN HA Hospital Facility RB, Indianapolis Osteopathic, 3.65%(/1/)................ 3,275,000 3,275,000 Merrillville, IN HCF RRB, Southlake, Series A-1, 3.75%(/1/).......................................... 4,215,000 4,215,000 Rockport, IN PC RRB, Indiana & Michigan Electric Co. Project, Series A, 3.65%(/1/)....................... 13,000,000 13,000,000 South Bend, IN HCF RRB, Fountainview, Series A-1, 3.75%(/1/).......................................... 3,180,000 3,180,000 St. Joseph Cnty., IN HA SPO Bonds, Madison Center, Inc. Project, 3.65%(/1/)............................ 6,525,000 6,525,000 St. Joseph Cnty., IN Industrial Educational Facilities RB, Holy Cross College, 3.65%(/1/)....... 1,230,000 1,230,000 ------------ 70,228,586 ------------
6 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- -------------- IOWA--0.3% Mason City, IA IDV RB, SuperValu Stores, Inc. Project, 3.55%(/1/)................................ $ 4,900,000 $ 4,900,000 -------------- KANSAS--0.4% Manhattan, KS Industrial RRB, Parker Hannifin, Inc. Project, 3.55%(/1/)................................ 6,000,000 6,000,000 Olathe, KS Industrial RRB, William F. Bieber Project, 3.75%(/1/)................................ 1,550,000 1,550,000 Ottawa, KS IDV RB, Laich Industries Project, 3.80%(/1/)......................................... 610,000 610,000 -------------- 8,160,000 -------------- KENTUCKY--0.9% Jamestown, KY Industrial Building RB, Union Underwear Co., 3.70%(/1/).......................... 1,000,000 1,000,000 Mayfield, KY Multi-City Lease RB, Kentucky League of Cities Funding Trust, 3.70%(/1/)................... 15,200,000 15,200,000 -------------- 16,200,000 -------------- LOUISIANA--0.3% East Baton Rouge Parish, LA IDV Board RRB, La Quinta Motor Inns, Inc., 3.65%(/1/)....................... 1,925,000 1,925,000 Lake Charles, LA Harbor & Terminal District RB, Reynolds Metals Co. Project, 3.85%, 12/1/98(/2/)... 4,085,000 4,085,000 -------------- 6,010,000 -------------- MARYLAND--2.8% Anne Arundel Cnty., MD ED RB, West Capitol, Series A, 3.55%(/1/)...................................... 6,000,000 6,000,000 MD Health & HEFAU RB: Helix Health Hospital Issue, Series A, 3.55%(/1/).. 19,700,000 19,700,000 University of Maryland Pooled Loan Program, Series B, 3.90%(/1/)..................................... 1,075,000 1,075,000 Montgomery Cnty., MD MH Opportunities Commission RB, Issue A, 3.70%(/1/)................................ 23,800,000 23,800,000 -------------- 50,575,000 -------------- MASSACHUSETTS--1.4% MA CMWLTH General Obligation Consolidation Loan, 3.70%, 1/15/99(/2/)................................ 14,600,000 14,600,000 MA State Health & Educational RB, Capital Asset Program, Series D, MBIA Insured, 3.90%(/1/)........ 10,200,000 10,200,000 North Andover Town, MA Industrial RB, Atlee-Oak Realty Trust of Delaware, Inc., 4.33%(/1/)......... 350,000 350,000 -------------- 25,150,000 -------------- MICHIGAN--2.7% Madison Heights, MI ED RB, Red Roof Inns Project, 3.90%(/1/)......................................... 1,000,000 1,000,000 MI Hospital FAU RRB, Mount Clemens General Hospital, 3.55%(/1/)......................................... 9,520,000 9,520,000
7 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- -------------- MICHIGAN (CONTINUED) MI Job DAU RB, East Lansing Residence Associates Project, 3.85%(/1/)................................ $ 1,900,000 $ 1,900,000 MI Tax & RAN, 4.50%, 9/30/98........................ 37,750,000 37,827,260 -------------- 50,247,260 -------------- MINNESOTA--3.6% Anoka City, MN MH RB, Walker Plaza, Series B, 3.60%(/1/)......................................... 1,650,000 1,650,000 Austin, MN IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)......................................... 4,600,000 4,600,000 Blaine, MN IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)......................................... 5,500,000 5,500,000 Burnsville, MN CD RB, SuperValu Stores, Inc. Project, Series 83, 3.55%(/1/)..................... 5,500,000 5,500,000 Cloquet, MN Industrial Facilities RB, Potlatch Corp. Projects, Series C, 3.60%(/1/)..................... 4,500,000 4,500,000 Dakota Cnty., MN MH & Redevelopment Mtg. RB, Westwood Ridge Rental Housing Project, Series A, 3.60%(/1/)......................................... 4,100,000 4,100,000 Eden Prairie, MN CD RRB, Lakeview Business Center, 3.60%(/1/)......................................... 2,495,000 2,495,000 Eden Prairie, MN IDV RB, SuperValu Stores, Inc. Project, 3.60%(/1/)................................ 1,000,000 1,000,000 Maplewood, MN CD RRB, 5.27%(/1/).................... 365,000 365,000 Minneapolis, MN CD RRB, Minnehaha/Lake Partners Project, 3.60%(/1/)................................ 2,750,000 2,750,000 Minneapolis, MN RB, Catholic Charities Project, 3.55%(/1/)......................................... 3,000,000 3,000,000 New Ulm, MN Hospital Facilities RB, Health Center Systems, 3.70%(/1/)................................ 2,300,000 2,300,000 North Suburban Hospital District, MN RB, Anoka & Ramsey Cntys. Hospital Health Center, 3.70%(/1/)... 3,300,000 3,300,000 St. Paul, MN Housing & Redevelopment Authority RB, Science Museum of Minnesota, Series B, 3.60%(/1/).. 6,400,000 6,400,000 St. Paul, MN POAU Tax Increment RB, Westgate Office & Industrial Center Project, 3.60%(/1/)............ 10,300,000 10,300,000 Stillwater, MN IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)................................ 5,500,000 5,500,072 Waite Park, MN Housing RRB, Park Meadows Apts. Project, 3.65%(/1/)................................ 3,195,000 3,195,000 -------------- 66,455,072 -------------- MONTANA--0.2% Great Falls, MT IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)................................ 1,000,000 1,000,000 MT Board Investment RR RB, Colstrip Project, 3.65%(/1/)......................................... 3,000,000 3,000,000 -------------- 4,000,000 -------------- NEBRASKA--0.2% Norfolk, NE IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)......................................... 2,800,000 2,800,000 -------------- NEVADA--1.1% NV Tax Bonds, Series SG114, 3.68%(/1/).............. 20,350,000 20,350,000 --------------
8 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ NEW JERSEY--0.2% NJ EDAU Manufacturing Facilities RB, VPR Commerce Center Project, 3.60%(/1/).......................... $ 3,700,000 $ 3,700,019 ------------ NEW MEXICO--0.3% Farmington, NM PC RRB, Arizona Public Service Co., Series A, 3.90%(/1/)................................ 5,800,000 5,800,000 ------------ NEW YORK--10.2% Franklin Cnty., NY IDA RAN, McAdam Cheese Co. Project, 3.55%(/1/)................................. 600,000 600,000 Long Island, NY PAU NY Electric Systems RB: 3.70%, 9/1/98(/2/).................................. 8,000,000 8,000,000 3.75%, 8/20/98(/2/)................................. 36,000,000 36,000,000 3.80%, 7/8/98(/2/).................................. 10,000,000 10,000,000 Series 6, 3.80%(/1/)................................ 7,000,000 7,000,000 Nassau Cnty., NY IDA Civic Facility RB, Winthrop University Hospital Assn. Project, 4%(/1/).......... 1,800,000 1,800,000 Nassau Cnty., NY, Improvement GOB, Series U, AMBAC Insured, 5.125%(/1/)................................ 800,000 803,552 Nassau Cnty., NY IDA RB, Cold Spring Harbor Labor Project, 3.95%(/1/)................................. 1,200,000 1,200,000 NYC HDC Multifamily Mortgage RB, James Tower Development, Series A, 3.40%(/1/)................... 2,900,000 2,900,023 NYC Health & Hospital Corp. RB, Series D, 3.20%(/1/).......................................... 1,500,000 1,500,000 NYC IDA Civic Facility RB, Columbia Grammar School Project: 3.45%(/1/).......................................... 800,000 799,983 3.85%(/1/).......................................... 100,000 99,998 NYC Trust Cultural Resources RRB, American Museum of Natural History: Series A, MBIA Insured, 3.25%(/1/).................. 1,000,000 1,000,000 Series B, MBIA Insured, 3.25%(/1/).................. 600,000 600,000 NYS DA COP, Rockefeller University, 3.79%(/1/)....... 500,000 500,014 NYS DA RB, Cornell University, Series B, 3.85%(/1/).. 200,000 200,000 NYS Environmental Quality GOB, 3.70%, 7/28/98(/2/)... 1,900,000 1,900,000 NYS ERDAUEF RB, L.I. Lighting Co.: Series A, 3.55%(/1/)................................ 400,000 400,000 Series B, 3.60%(/1/)................................ 1,300,000 1,300,004 NYS ERDAUPC RB: Niagara Mohawk Corp. Project, Series A, 3.85%(/1/).. 1,700,000 1,700,000 NYS Electric & Gas Corp., Series B, 3.80%, 10/15/98........................................... 700,000 699,930 NYS ERDAUPC RRB, Orange/Rockland Utility Project, Series A, AMBAC Insured, 3.25%(/1/)................. 1,600,000 1,599,996 NYS HFA RB, Normandie Court I Project, 3.20%(/1/).... 4,610,000 4,610,000
9 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ NEW YORK (CONTINUED) NYS LGAC RB: Series A, 3.20%(/1/)................................ $ 1,800,000 $ 1,799,986 Series SG100, MBIA Insured, 3.68%(/1/) ............. 10,420,000 10,420,000 Series SG99, MBIA Insured, 3.68%(/1/)............... 29,195,000 29,195,000 NYS MCFFA RB, Lenox Hill Hospital Project, Series A, 3.35%(/1/).......................................... 300,000 300,000 NYS PAU RB, Series SG4, 3.68%(/1/)................... 2,295,000 2,295,000 NYS TBTAU Beneficial Interest COP, MBIA Insured, 3.65%(/1/).......................................... 3,300,000 3,300,000 NYS Urban Empire Development Corp. RB, Series A, 3.63%(/1/).......................................... 9,700,000 9,700,000 PAUNYNJ SPO Bonds, Series SG94, 3.68%(/1/)........... 600,000 600,006 Suffolk Cnty., NY IDA RB, Nissequogue Cogeneration Partnership, 3.40%(/1/)............................. 800,000 800,007 Suffolk Cnty., NY Tax Anticipation Nts., Series RA-1, 4.25%, 8/13/98...................................... 42,500,000 42,531,058 ------------ 186,154,557 ------------ NORTH CAROLINA--0.2% NC National Bank Pooled Tax-Exempt Trust COP: Series 1990A, 4.25%(/1/)............................ 2,000,000 2,000,000 Series 1990B, 4.25%(/1/)............................ 1,575,000 1,575,000 ------------ 3,575,000 ------------ NORTH DAKOTA--0.1% Bismarck, ND IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/).......................................... 2,300,000 2,300,000 ------------ OHIO--2.3% Coshocton Cnty., OH Hospital FA RB, Coshocton Cnty., Memorial Hospital Project, 3.60%(/1/)............... 3,390,000 3,390,000 Gallia Cnty., OH IDV Mtg. RRB, Jackson Pike Assn., 3.85%, 12/15/98(/2/)................................ 3,855,000 3,855,000 Greene Cnty., OH IDV RRB, SuperValu Holdings, Inc. Project, 3.55%(/1/)................................. 1,000,000 1,000,000 Marion Cnty., OH Hospital RB, Pooled Lease Program, 3.60%(/1/).......................................... 9,455,000 9,455,000 Miami Valley, OH Tax-Exempt Mtg. Trust RB, Series 86, 4.88%, 10/15/98..................................... 2,695,000 2,695,000 OH Water DAU PC Facilities RRB, Duquesne Project, Series A, 3.85%, 11/18/98........................... 14,955,000 14,955,000 Scioto Cnty., OH HCF RB, Hill View Retirement Center, 3.80%, 12/1/98(/2/)................................. 2,735,000 2,735,000 Toledo, OH City Services SPAST Nts., 3.55%(/1/)...... 2,720,000 2,720,000 Warren Cnty., OH IDV RRB, Liquid Container Project, 3.60%(/1/).......................................... 1,670,000 1,670,000 ------------ 42,475,000 ------------
10 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ OKLAHOMA--1.4% Claremore, OK Industrial & Redevelopment Authority RRB, Worthington Cylinder Project, 3.65%(/1/)....... $ 2,195,000 $ 2,195,000 Cleveland Cnty., OK Public Facilities RB, Hunt Development Project, Series A, 3.85%(/1/)........... 1,000,000 1,000,000 Mid-West, OK Tax-Exempt Mtg. Board Trust RB, 3.70%(/1/).......................................... 760,000 760,000 OK Water Resource Board State Loan Program RB, 3.55%, 9/1/98(/2/)......................................... 4,340,000 4,340,000 Oklahoma Cnty., OK FAU MH RB, Lakes on Meridial Project, Series A, 3.85%, 11/12/98(/2/)............. 7,441,800 7,441,800 Tulsa, OK Industrial Authority RB, 3.337%(/1/)....... 6,500,000 6,500,000 Tulsa, OK Tulsa IDAU RB, Indian Health Care Project, 3.60%(/1/).......................................... 3,100,000 3,100,000 ------------ 25,336,800 ------------ OREGON--0.6% Hillsboro, OR RB, Oregon Graduate Institute, 3.50%(/1/).......................................... 6,500,000 6,500,000 OR Economic & IDV Commission RB, Eagle-Picher Industries Project, 3.70%(/1/)...................... 3,600,000 3,600,000 ------------ 10,100,000 ------------ PENNSYLVANIA--0.3% Monroe Cnty., PA HA RB, Pocono Medical Center, Series C, 3.85%(/1/)....................................... 3,000,000 3,000,000 Montgomery Cnty., PA IDAU RB, Quaker Chemical Corp. Project, 3.85%(/1/)................................. 1,600,000 1,600,000 ------------ 4,600,000 ------------ SOUTH CAROLINA--2.4% Charleston Center Tax-Exempt Bonds: Grantor Trust No. 2, 3.70%, 11/1/98(/2/)............ 4,407,500 4,407,500 Grantor Trust No. 3, 3.75%, 7/1/98(/2/)............. 9,452,500 9,452,500 Grantor Trust No. 6, 3.60%, 10/1/98(/2/)............ 8,075,000 8,075,000 Dorchester Cnty., SC PC Facilities RRB, The BOC Group, Inc. Project, 3.55%(/1/)..................... 3,500,000 3,500,000 SC Educational FA RB, Private Nonprofit Institutions- Morris College Project, 3.65%(/1/).................. 3,000,000 3,000,000 SC Jobs & EDAU Hospital Facilities RRB, Wellman, Inc. Project, 3.65%(/1/)................................. 1,000,000 1,000,000 SC Public Service Authority RB, Series 182, MBIA Insured, 3.63%(/1/)................................. 14,200,000 14,200,000 ------------ 43,635,000 ------------ SOUTH DAKOTA--2.0% Grant Cnty., SD PC RRB, Otter Tail Power Co. Project, 3.60%(/1/).......................................... 10,400,000 10,400,000 SD Health & Educational Facilities RB, Sioux Valley Hospital Issue, 3.60%(/1/).......................... 22,000,000 22,000,000 Watertown, SD IDV RRB, SuperValu Stores, Inc. Project, 3.55%(/1/)................................. 3,900,000 3,900,000 ------------ 36,300,000 ------------
11 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- ------------ TENNESSEE--3.6% Clarksville, TN Public Building Authority RB, Pooled Financing-Tennessee Municipal Bond Fund, 3.60%(/1/).......................................... $10,100,000 $ 10,100,000 Dayton, TN IDV Board RRB, La-Z-Boy Chair Co. Project, 3.55%(/1/).......................................... 4,350,000 4,350,000 Fayetteville & Lincoln, TN IDV Board RB, V.A.W. of America, 3.75%(/1/)................................. 2,000,000 2,000,000 Knox Cnty., TN IDV Board RB, Weisgarber Partners, FGIC Insured, 3.75%(/1/)............................ 3,000,000 3,000,000 Montgomery Cnty., TN Public Building Authority RB: Montgomery Cnty. Loan, 3.60%(/1/)................... 22,100,000 22,100,000 Tennessee Cnty. Loan, 3.60%(/1/).................... 20,000,000 20,000,000 Nashville & Davidson Cnty. Metropolitan Government, TN MH RB, Arbor Crest Project, Series B, 3.55%(/1/).......................................... 3,550,000 3,550,000 Rutherford Cnty., TN IDV Board Industrial Building RB, Derby Industries, Inc. Project, 3.70%(/1/)...... 1,255,000 1,255,000 ------------ 66,355,000 ------------ TEXAS--14.3% Comal Cnty., TX IDAU RB, Simpson Co. Project, 4.066%(/1/)......................................... 2,800,000 2,800,000 De Soto, TX IDAU RRB, National Service Industries, Inc. Project, 3.55%(/1/)............................ 7,150,000 7,150,000 Harris Cnty., TX Criminal Justice Center RB, Series SG96, FGIC Insured, 3.68%(/1/)...................... 7,475,000 7,475,000 Harris Cnty., TX Toll Road COP, 3.731%(/1/).......... 9,500,000 9,500,000 Hockley Cnty., TX IDV Corp. PC RB, Amoco Project- Standard Oil Co., 3.60%, 9/1/98(/2/).................................. 25,250,000 25,250,854 Houston, TX WSS RB, Series SG120, 3.68%(/1/)......... 37,600,000 37,600,000 San Antonio, TX Electric & Gas RRB: Series SG105, 3.60%(/1/)............................ 20,000,000 20,000,000 Series G-101, 3.68%(/1/)............................ 20,000,000 20,000,000 Travis Cnty., TX Housing Finance Corp. MH RB, Bent Oaks Apts., 3.65%(/1/).............................. 4,400,000 4,400,000 TX Brazos River Authority PC RRB, Texas Utilities Electric Co., Series A, 3.90%(/1/).................. 9,370,000 9,370,000 TX Gulf Coast Waste Disposal Authority Texas Environmental Improvement RB, Amoco Oil Co. Project, 3.50%, 9/1/98(/2/).................................. 7,000,000 7,000,000 TX Gulf Coast Waste Disposal Authority Texas PC RB, Amoco Oil Co. Project, 3.90%(/1/)................... 5,300,000 5,300,000 TX Tax & RAN, Series A, 4.75%, 8/31/98............... 85,000,000 85,157,652 TX TUAU RB, Dallas Northtollway, Series SG70, 3.68%(/1/).......................................... 15,325,000 15,325,000 Yoakum Cnty., TX IDV PC RB, Amoco Project, 3.65%, 11/1/98(/2/)........................................ 5,265,000 5,265,000 ------------ 261,593,506 ------------
12 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust
Face Value Amount See Note 1 ----------- -------------- UTAH--0.5% UT HFA MH RRB, Candlestick Apts. Project, 3.55%(/1/)....................................... $ 6,400,000 $ 6,400,000 Weber Cnty., UT IDV RRB, Parker Properties, Inc. Project, 3.55%(/1/).............................. 2,600,000 2,600,000 -------------- 9,000,000 -------------- VERMONT--0.0% VT IDAU RB, Sherbern Corp., Series 1998, 4.33%(/1/)....................................... 520,000 520,000 -------------- VIRGINIA--0.2% Henry City, VA IDAU RB, Amfibe, Inc. Project, 3.70%(/1/)....................................... 3,000,000 3,000,000 -------------- WASHINGTON--3.3% Port Longview, WA IDV RB, Longview Fibre Co. Project, 3.60%(/1/).............................. 5,000,000 5,000,000 Redmond, WA Public Corp. Industrial RRB, Genie Industries: Lot 1, 3.50%(/1/)................................ 960,000 960,000 Lot 2, 3.50%(/1/)................................ 1,675,000 1,675,000 Seattle, WA IDV Corp. RB, 3.55%(/1/).............. 4,500,000 4,500,000 WA GOB, Series 1996-A, 3.40%(/1/)................. 34,400,000 34,400,000 WA GORB, Series 1995C, 3.63%(/1/)................. 13,100,000 13,100,000 -------------- 59,635,000 -------------- WYOMING--0.2% Uinta Cnty., WY PC RB, AMOCO Standard Oil Co. of Indiana Project, 3.85%, 12/1/98(/2/)............. 3,000,000 3,000,000 -------------- U.S. POSSESSIONS--3.4% PR CMWLTH Tax & RAN, Series A, 4.50%, 7/30/98..... 62,900,000 62,936,711 -------------- Total Investments, at Value....................... 99.0% 1,810,845,087 Other Assets Net of Liabilities................... 1.0 18,140,674 ----------- -------------- Net Assets........................................ 100.0% $1,828,985,761 =========== ==============
13 STATEMENT OF INVESTMENTS June 30, 1998 (Continued) Centennial Tax Exempt Trust To simplify the listings of securities, abbreviations are used per the table below: BOE Board of Education CD Commercial Development CDAU Communities Development Authority CDC Community Development Corp. CMWLTH Commonwealth COP Certificates of Participation DA Dormitory Authority DAU Development Authority ED Economic Development EDAU Economic Development Authority EDFAU Economic Development Finance Authority ERDAUEF Energy Research & Development Authority Electric Facilities ERDAUPC Energy Research & Development Authority Pollution Control FA Facilities Authority FAU Finance Authority GOB General Obligation Bonds GORB General Obligation Refunding Bonds HA Hospital Authority HAU Housing Authority HCF Health Care Facilities HDC Housing Development Corp. HEAU Higher Education Authority HEFAU Higher Educational Facilities Authority HFA Housing Finance Agency HFAU Health Facilities Authority HFFAU Health Facilities Finance Authority IDV Industrial Development
IDA Industrial Development Agency IDAU Industrial Development Authority LGAC Local Government Assistance Corp. LI Long Island MCFFA Medical Care Facilities Finance Agency MH Multifamily Housing MPA Municipal Power Agency NYC New York City NYS New York State PAU Port Authority PAUNYNJ Port Authority of New York & New Jersey PC Pollution Control PCFAU Pollution Control Finance Authority POAU Port Authority PPA Public Power Agency RA Redevelopment Agency RAN Revenue Anticipation Nts. RB Revenue Bonds RR Resource Recovery RRB Revenue Refunding Bonds SDI School District SPAST Special Assessment SPO Special Obligations SWD Solid Waste Disposal TBTAU Triborough Bridge & Tunnel Authority TUAU Turnpike Authority WSS Water & Sewer System
1. Floating or variable rate obligation maturing in more than one year. The interest rate, which is based on specific, or an index of, market interest rates, is subject to change periodically and is the effective rate on June 30, 1998. This instrument may also have a demand feature which allows, on up to 30 days' notice, the recovery of principal at any time, or at specified intervals not exceeding one year. 2. Put obligation redeemable at full face value on the date reported. 3. Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $18,135,000 or 0.99% of the Trust's net assets as of June 30, 1998. See accompanying Notes to Financial Statements. 14 STATEMENT OF ASSETS AND LIABILITIES June 30, 1998 Centennial Tax Exempt Trust ASSETS Investments, at value......................................... $1,810,845,087 Cash.......................................................... 1,469,157 Receivables: Shares of beneficial interest sold........................... 24,186,960 Interest..................................................... 16,997,490 Other......................................................... 69,155 -------------- Total assets................................................ 1,853,567,849 -------------- LIABILITIES Payables and other liabilities: Shares of beneficial interest redeemed....................... 22,298,852 Dividends.................................................... 1,787,330 Service plan fees ........................................... 165,664 Transfer and shareholder servicing agent fees ............... 155,738 Other........................................................ 174,504 -------------- Total liabilities .......................................... 24,582,088 -------------- NET ASSETS.................................................... $1,828,985,761 ============== COMPOSITION OF NET ASSETS Paid-in capital............................................... $1,829,568,616 Accumulated net realized loss on investment transactions...... (582,855) -------------- NET ASSETS--applicable to 1,829,584,584 shares of beneficial interest outstanding ........................................ $1,828,985,761 ============== NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE........................................................ $1.00
See accompanying Notes to Financial Statements. 15 STATEMENT OF OPERATIONS For the Year Ended June 30, 1998 Centennial Tax Exempt Trust INVESTMENT INCOME--Interest........................................ $68,843,452 ----------- EXPENSES Management fees--Note 3............................................ 7,721,361 Service plan fees--Note 3.......................................... 3,658,752 Transfer and shareholder servicing agent fees--Note 3.............. 815,204 Custodian fees and expenses........................................ 138,781 Shareholder reports................................................ 115,885 Registration and filing fees....................................... 107,288 Legal, auditing and other professional fees........................ 41,320 Trustees' fees and expenses........................................ 21,248 Other.............................................................. 14,154 ----------- Total expenses.................................................... 12,633,993 ----------- NET INVESTMENT INCOME.............................................. 56,209,459 ----------- NET REALIZED LOSS ON INVESTMENTS................................... (569,188) ----------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... $55,640,271 ===========
See accompanying Notes to Financial Statements. 16 STATEMENTS OF CHANGES IN NET ASSETS Centennial Tax Exempt Trust
Year Ended June 30, ------------------------------ 1998 1997 -------------- -------------- OPERATIONS Net investment income.......................... $ 56,209,459 $ 46,978,389 Net realized gain (loss)....................... (569,188) 116,199 -------------- -------------- Net increase in net assets resulting from oper- ations........................................ 55,640,271 47,094,588 -------------- -------------- DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS.... (56,328,253) (47,224,231) -------------- -------------- BENEFICIAL INTEREST TRANSACTIONS Net increase in net assets resulting from beneficial interest transactions--Note 2.......................... 180,927,614 222,881,798 -------------- -------------- NET ASSETS Total increase................................. 180,239,632 222,752,155 Beginning of period............................ 1,648,746,129 1,425,993,974 -------------- -------------- End of period.................................. $1,828,985,761 $1,648,746,129 ============== ==============
See accompanying Notes to Financial Statements. 17 FINANCIAL HIGHLIGHTS Centennial Tax Exempt Trust
Year Ended June 30, -------------------------------------- 1998 1997 1996 1995 1994 ------ ------ ------ ------ ------ PER SHARE OPERATING DATA Net asset value, beginning of period.. $1.00 $1.00 $1.00 $1.00 $1.00 Income from investment operations--net investment income and net realized gain................................. .03 .03 .03 .03 .02 Dividends and distributions to shareholders......................... (.03) (.03) (.03) (.03) (.02) ------ ------ ------ ------ ------ Net asset value, end of period........ $1.00 $1.00 $1.00 $1.00 $1.00 ====== ====== ====== ====== ====== TOTAL RETURN(/1/)..................... 3.12% 3.01% 3.16% 3.17% 1.90% RATIOS/SUPPLEMENTAL DATA Net assets, end of period (in millions)............................ $1,829 $1,649 $1,426 $1,315 $1,039 Average net assets (in millions)...... $1,832 $1,591 $1,473 $1,127 $1,057 Ratios to average net assets: Net investment income................. 3.07% 2.95% 3.12% 3.13% 1.87% Expenses(/2/)......................... 0.69% 0.72% 0.72% 0.73% 0.76%
1. Assumes a hypothetical initial investment on the business day before the first day of the fiscal period, with all dividends reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Total returns reflect changes in net investment income only. 2. Beginning in fiscal 1995, the expense ratio reflects the effect of gross expenses paid indirectly by the Trust. Prior year expense ratios have not been adjusted. See accompanying Notes to Financial Statements. 18 NOTES TO FINANCIAL STATEMENTS Centennial Tax Exempt Trust 1. SIGNIFICANT ACCOUNTING POLICIES Centennial Tax Exempt Trust (the Trust) is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The Trust's investment objective is to seek the maximum short-term interest income exempt from Federal income taxes that is consistent with low capital risk and the maintenance of liquidity by investing in short-term municipal securities. The Trust's investment advisor is Centennial Asset Management Corporation (the Manager), a subsidiary of OppenheimerFunds, Inc. (OFI). The following is a summary of significant accounting policies consistently followed by the Trust. Investment Valuation. Portfolio securities are valued on the basis of amortized cost, which approximates market value. Federal Taxes. The Trust intends to continue to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income, including any net realized gain on investments not offset by loss carryovers, to shareholders. Therefore, no federal income or excise tax provision is required. At June 30, 1998, the Trust had available for federal income tax purposes an unused capital loss carryover of approximately $34,000, which expires in 2006. Distributions to Shareholders. The Trust intends to declare dividends from net investment income each day the New York Stock Exchange is open for business and pay such dividends monthly. To effect its policy of maintaining a net asset value of $1.00 per share, the Trust may withhold dividends or make distributions of net realized gains. Other. Investment transactions are accounted for on the date the investments are purchased or sold (trade date). Realized gains and losses on investments are determined on an identified cost basis, which is the same basis used for federal income tax purposes. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. 19 NOTES TO FINANCIAL STATEMENTS (Continued) Centennial Tax Exempt Trust 2. SHARES OF BENEFICIAL INTEREST The Trust has authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:
Year Ended June 30, 1998 Year Ended June 30, 1997 ------------------------------- ------------------------------- Shares Amount Shares Amount -------------- --------------- -------------- --------------- Sold.................... 5,609,068,596 $ 5,609,068,596 4,793,933,452 $ 4,793,933,452 Dividends and distributions reinvested............. 55,170,917 55,170,917 45,861,059 45,861,059 Redeemed................ (5,483,311,899) (5,483,311,899) (4,616,912,713) (4,616,912,713) -------------- --------------- -------------- --------------- Net increase............ 180,927,614 $ 180,927,614 222,881,798 $ 222,881,798 ============== =============== ============== ===============
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES Management fees paid to the Manager were in accordance with the investment ad- visory agreement with the Trust which provides for a fee of 0.50% of the first $250 million of net assets; 0.475% of the next $250 million of net assets; 0.45% of the next $250 million of net assets; 0.425% of the next $250 million of net assets; 0.40% of the next $250 million of net assets; 0.375% of the next $250 million of net assets; 0.35% of the next $500 million of net assets and 0.325% of net assets in excess of $2 billion. Shareholder Services, Inc. (SSI), a subsidiary of OFI, is the transfer and shareholder servicing agent for the Trust and for other registered investment companies. SSI's total costs of providing such services are allocated ratably to these companies. Under an approved service plan, the Trust may expend up to 0.20% of its net assets annually to reimburse the Manager, as distributor, for costs incurred in connection with the personal service and maintenance of accounts that hold shares of the Trust, including amounts paid to brokers, dealers, banks and other institutions. During the year ended June 30, 1998, the Trust paid $11,157 to a broker/dealer affiliated with the Manager as reimbursement for distribution-related expenses. 20 INDEPENDENT AUDITORS' REPORT Centennial Tax Exempt Trust The Board of Trustees and Shareholders of Centennial Tax Exempt Trust: We have audited the accompanying statement of assets and liabilities, including the statement of investments, of Centennial Tax Exempt Trust as of June 30, 1998, the related statement of operations for the year then ended, the statements of changes in net assets for the years ended June 30, 1998 and 1997, and the financial highlights for the period July 1, 1993 to June 30, 1998. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned at June 30, 1998 by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements and financial highlights present fairly, in all material respects, the financial position of Centennial Tax Exempt Trust at June 30, 1998, the results of its operations, the changes in its net assets, and the financial highlights for the respective stated periods, in conformity with generally accepted accounting principles. DELOITTE & TOUCHE LLP Denver, Colorado July 22, 1998 21 FEDERAL INCOME TAX INFORMATION (Unaudited) Centennial Tax Exempt Trust In early 1999, shareholders will receive information regarding all dividends and distributions paid to them by the Trust during calendar year 1998. Regulations of the U.S. Treasury Department require the Trust to report this information to the Internal Revenue Service. None of the dividends paid by the Trust during the fiscal year ended June 30, 1998 are eligible for the corporate dividend-received deduction. The dividends were derived from interest on municipal bonds and are not subject to federal income tax. To the extent a shareholder is subject to any state or local tax laws, some or all of the dividends received may be taxable. The foregoing information is presented to assist shareholders in reporting distributions received from the Trust to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance. 22 Centennial Tax Exempt Trust 1998 Annual Report Officers and Trustees James C. Swain, Chairman and Chief Executive Officer Bridget A. Macaskill, Trustee and President Robert G. Avis, Trustee William A. Baker, Trustee Charles Conrad, Jr., Trustee Jon S. Fossel, Trustee Sam Freedman, Trustee Centennial Raymond J. Kalinowski, Trustee Tax Exempt C. Howard Kast, Trustee Trust Robert M. Kirchner, Trustee Ned M. Steel, Trustee June 30, 1998 George C. Bowen, Trustee, Vice President, Treasurer and Assistant Secretary Andrew J. Donohue, Vice President and Secretary Michael J. Carbuto, Vice President Robert J. Bishop, Assistant Treasurer Scott T. Farrar, Assistant Treasurer Robert G. Zack, Assistant Secretary Investment Advisor and Distributor Centennial Asset Management Corporation Transfer and Shareholder Servicing Agent Shareholder Services, Inc. Custodian of Portfolio Securities Citibank, N.A. Independent Auditors Deloitte & Touche LLP Legal Counsel Myer, Swanson, Adams & Wolf, P.C. This is a copy of a report to shareholders of Centennial Tax Exempt Trust. This report must be preceded or accompanied by a Prospectus of Centennial Tax Exempt Trust. For material information concerning the Trust, see the Prospectus. For shareholder servicing, call: 1-800-525-9310 (in U.S.) 303-671-3200 (outside U.S.) Or write: Shareholder Services, Inc. P.O. Box 5143 Denver, CO 80217-5143 RA0160.001.0698 [LOGO]Printed on recycled paper -----END PRIVACY-ENHANCED MESSAGE-----