497

Oppenheimer Variable Account Funds

6803 S. Tucson Way, Centennial, Colorado 80112
1.800.981.2871

Statement of Additional Information dated April 29, 2005, revised December 6,
2005

OPPENHEIMER VARIABLE ACCOUNT FUNDS (the "Trust") is an investment company
consisting of 11 separate Series (the "Funds"):

Oppenheimer Aggressive Growth Fund/VA
Oppenheimer Balanced Fund/VA
Oppenheimer Capital Appreciation Fund/VA
Oppenheimer Core Bond Fund/VA
      (named "Oppenheimer Bond Fund/VA" prior to April 29, 2005)
Oppenheimer Global Securities Fund/VA
Oppenheimer High Income Fund/VA
Oppenheimer Main Street Fund(R)/VA
Oppenheimer Main Street Small Cap Fund(R)/VA
Oppenheimer Money Fund/VA
Oppenheimer Strategic Bond Fund/VA
Oppenheimer Value Fund/VA

      Shares of the Funds are sold to provide benefits under variable life
insurance policies and variable annuity contracts and other insurance company
separate accounts, as described in the Prospectuses for the Funds and for the
insurance products you have selected.

      This Statement of Additional Information is not a Prospectus. This
document contains additional information about the Funds and the Trust, and
supplements information in the Funds' Prospectuses dated April 29, 2005. It
should be read together with the Prospectuses. You can obtain a Prospectus by
writing to the Funds' Transfer Agent, OppenheimerFunds Services, at P.O. Box
5270, Denver, Colorado 80217, by calling the Transfer Agent at the toll-free
number shown above or by visiting the OppenheimerFunds website at
www.oppenheimerfunds.com.



Contents                                                                Page

About the Funds
Additional Information About the Funds' Investment Policies and Risks...   3
    The Funds' Investment Policies......................................   3
    Other Investment Techniques and Strategies..........................  17
    Other Investment Restrictions.......................................  38
    Disclosure of Portfolio Holdings....................................  41
How the Funds are Managed ..............................................  46
    Organization and History............................................  46
    Board of Trustees and Oversight Committees..........................  47
    Trustees and Officers of the Funds..................................  49
    The Manager.........................................................  59
Brokerage Policies of the Funds.........................................  65
Distribution and Service Plans (Service Shares and Class 4 Shares)...........................
68
Payments to Fund Intermediaries.........................................  70
Performance of the Funds................................................  73

About Your Account
How To Buy and Sell Shares..............................................  79
Dividends, Capital Gains and Taxes......................................  84
Additional Information About the Funds..................................  86

Financial Information About the Funds *
Report  of  Independent   Registered  Public  Accounting  Firm  and  Financial
Statements.............................................................. F-1

Appendix A: Ratings Definitions......................................... A-1
Appendix B: Industry Classifications (Oppenheimer Money Fund/VA)........ B-1
Appendix C: Industry Classifications (all other Funds).................. C-1
Appendix D: Major Shareholders.......................................... D-1

*This Statement of Additional Information consists of two separate documents.
This text comprises the first document. The second document contains the Report
of the Independent Registered Public Accounting Firm and Financial Statements
for each Fund. The two documents should be read together with the Prospectuses
for the Funds and for the insurance products you have selected. These documents
can also be viewed or downloaded online with Adobe Acrobat Reader. Call
1.888.470.0861 if you want the domain name of an insurance sponsor's website
that displays both documents comprising this Statement of Additional Information
online, if you have technical difficulties, or to request a paper copy of both
documents comprising this Statement of Additional Information at no charge.



ABOUT THE FUNDS

Additional Information About the Funds' Investment Policies and Risks

.......The investment objective, the principal investment policies and the main
risks of the Funds are described in the Funds' Prospectuses. This Statement of
Additional Information contains supplemental information about those policies
and risks and the types of securities that the Funds' investment Manager,
OppenheimerFunds, Inc. (the "Manager"), can select for the Funds. Additional
information is also provided about the strategies that each Fund may use to try
to achieve its objective. The full name of each Fund is shown on the cover page,
the word "Oppenheimer" is omitted from these names in the rest of this document,
to conserve space.

The Funds' Investment Policies. The composition of the Funds' portfolios and the
techniques and strategies that the Manager uses in selecting portfolio
securities will vary over time. The Funds are not required to use all of the
investment techniques and strategies described below at all times in seeking
their goals. They may use some of the special investment techniques and
strategies at some times or not at all.

.......In selecting securities for the Funds' portfolios, the Manager evaluates
the merits of particular securities primarily through the exercise of its own
investment analysis. That process may include, among other things:
o.....evaluation of the issuer's historical operations, o prospects for the
industry of which the issuer is part, o the issuer's financial condition, o its
pending product developments and business (and those of
         competitors),
o     the effect of general market and economic conditions on the issuer's
         business, and
o     legislative proposals that might affect the issuer.

      The Funds are categorized by the types of investment they make. Aggressive
Growth Fund/VA, Capital Appreciation Fund/VA, Global Securities Fund/VA, Main
Street Small Cap Fund(R)/VA, and Value Fund/VA can be categorized as "Equity
Funds." High Income Fund/VA, Core Bond Fund/VA, and Strategic Bond Fund/VA can
be categorized as "Fixed Income Funds." Balanced Fund/VA and Main Street
Fund(R)/VA share the investment characteristics (and certain of the Investment
Policies) of both the Equity Funds and the Fixed Income Funds, depending upon
the allocations determined from time to time by their portfolio managers. The
allocation of Main Street Fund(R)/VA's portfolio to equity securities is
generally substantially larger than its allocation to fixed-income securities.
Money Fund/VA's investment policies are explained separately; however,
discussion below about investment restrictions, repurchase agreements, illiquid
securities and loans of portfolio securities also apply to Money Fund/VA.

      |X| Investments in Equity Securities. The Equity Funds focus their
investments in equity securities, which include common stocks, preferred stocks,
rights and warrants, and securities convertible into common stock. Certain
equity securities may be selected not only for their appreciation possibilities
but because they may provide dividend income. At times, a Fund may have
substantial amounts of its assets invested in securities of issuers in one or
more capitalization ranges, based upon the Manager's use of its investment
strategies and its judgment of where the best market opportunities are to seek a
Fund's objective.

      Small-cap growth companies may offer greater opportunities for capital
appreciation than securities of large, more established companies. However,
these securities also involve greater risks than securities of larger companies.
Securities of small- and mid- cap issuers may be subject to greater price
volatility in general than securities of large-cap companies. Therefore, to the
degree that a Fund has investments in smaller capitalization companies at times
of market volatility, that Fund's share prices may fluctuate more. Main Street
Small Cap Fund(R)/VA will invest primarily in securities of small-cap issuers,
but, for the other equity funds those investments may be limited to the extent
the Manager believes that such investments would be inconsistent with the goal
of preservation of principal.

o Growth Investing. In selecting equity investments, the portfolio managers for
the Equity Funds may from time to time use a growth investing style, a value
investing style, or a combination of both. In using a growth approach, the
portfolio managers seek securities of "growth" companies. Growth companies are
those companies that the Manager believes are entering into a growth cycle in
their business, with the expectation that their stock will increase in value.
They may be established companies, as well as, newer companies in the
development stage. Growth companies may have a variety of characteristics that
in the Manager's view define them as "growth" issuers.

      Growth companies may be generating or applying new technologies, new or
improved distribution techniques or new services. They may own or develop
natural resources. They may be companies that can benefit from changing consumer
demands or lifestyles, or companies that have projected earnings in excess of
the average for their sector or industry. In each case, they have prospects that
the Manager believes are favorable for the long term. The portfolio managers of
the Funds look for growth companies with strong, capable management, sound
financial and accounting policies, successful product development and marketing
and other factors.

o Value Investing. In selecting equity investments, the portfolio managers for
the Equity Funds in particular may from time to time use a value investing
style. In using a value approach, the portfolio managers seek stock and other
equity securities that appear to be temporarily undervalued, by various
measures, such as price/earnings ratios, rather than seeking stocks of "growth"
issuers. This approach is subject to change and might not necessarily be used in
all cases. Value investing seeks stocks having prices that are low in relation
to their real worth or future prospects, in the hope that a Fund will realize
appreciation in the value of its holdings when other investors realize the
intrinsic value of the stock.

      Using value investing requires research as to the issuer's underlying
financial condition and prospects. Some of the measures that can be used to
identify these securities include, among others:
o        Price/Earnings ratio, which is the stock's price divided by its
         earnings per share. A stock having a price/earnings ratio lower than
         its historical range, or the market as a whole or that of similar
         companies may offer attractive investment opportunities.
o        Price/book value ratio, which is the stock price divided by the book
         value of the company per share, which measures the company's stock
         price in relation to its asset value.
o        Dividend Yield is measured by dividing the annual dividend by the stock
         price per share.
o        Valuation of Assets, which compares the stock price to the value of the
         company's underlying assets, including their projected value in the
         marketplace and liquidation value.

o Convertible Securities. While convertible securities are generally a form of
debt security, in many cases their conversion feature (allowing conversion into
equity securities) causes them to be regarded by the Manager more as "equity
equivalents." As a result, the credit rating assigned to the security has less
impact on the Manager's investment decision with respect to convertible
securities than in the case of non-convertible fixed income securities.
Convertible securities are subject to the credit risks and interest rate risks
described below in "Debt Securities."

      To determine whether convertible securities should be regarded as "equity
equivalents," the Manager examines the following factors: (1) whether, at the
option of the investor, the convertible security can be
         exchanged for a fixed number of shares of common stock of the issuer,
(2) whether the issuer of the convertible securities has restated its
         earnings per share of common stock on a fully diluted basis
         (considering the effect of conversion of the convertible
         securities), and
(3)      the extent to which the convertible security may be a defensive "equity
         substitute," providing the ability to participate in any appreciation
         in the price of the issuer's common stock.

o Rights and Warrants. The Funds may invest in warrants or rights. They do not
expect that their investments in warrants and rights will exceed 5% of their
total assets. That limit does not apply to warrants and rights that the Funds
have acquired as part of units of securities or that are attached to other
securities. No more than 2% of Value Fund/VA's total assets may be invested in
warrants that are not listed on either The New York Stock Exchange (the
"Exchange") or The American Stock Exchange.

      Warrants basically are options to purchase equity securities at specific
prices valid for a specific period of time. Their prices do not necessarily move
parallel to the prices of the underlying securities. Rights are similar to
warrants, but normally have a short duration and are distributed directly by the
issuer to its shareholders. Rights and warrants have no voting rights, receive
no dividends and have no liquidation rights with respect to the assets of the
issuer.

      |X| Preferred Stocks. Preferred stocks are equity securities but have
certain attributes of debt securities. Preferred stock, unlike common stock, has
a stated dividend rate payable from the corporation's earnings. Preferred stock
dividends may be cumulative or non-cumulative, participating, or auction rate.
"Cumulative" dividend provisions require all or a portion of prior unpaid
dividends to be paid before the issuer can pay dividends on common shares.

      If interest rates rise, the fixed dividend on preferred stocks may be less
attractive, causing the price of preferred stocks to decline. Preferred stock
may have mandatory sinking fund provisions, as well as provisions for their call
or redemption prior to maturity which can have a negative effect on their prices
when interest rates decline. Preferred stock may be "participating" stock, which
means that it may be entitled to a dividend exceeding the stated dividend in
certain cases.

      Preferred stocks are equity securities because they do not constitute a
liability of the issuer and therefore do not offer the same degree of protection
of capital as debt securities and may not offer the same degree of assurance of
continued income as debt securities. The rights of preferred stock on
distribution of a corporation's assets in the event of its liquidation are
generally subordinate to the rights associated with a corporation's debt
securities. Preferred stock generally has a preference over common stock on the
distribution of a corporation's assets in the event of its liquidation.

      |X| Investments in Bonds and Other Debt Securities. The Fixed Income Funds
in particular can invest in bonds, debentures and other debt securities to seek
current income as part of their investment objectives.

      A Fund's debt investments can include investment-grade and
non-investment-grade bonds (commonly referred to as "junk bonds").
Investment-grade bonds are bonds rated at least "Baa" by Moody's Investors
Service, Inc., ("Moody's") or at least "BBB" by Standard & Poor's Rating
Services ("S&P") or Fitch, Inc. ("Fitch") or that have comparable ratings by
another nationally recognized rating organization. In making investments in debt
securities, the Manager may rely to some extent on the ratings of ratings
organizations or it may use its own research to evaluate a security's
credit-worthiness. If the securities that a Fund buys are unrated, to be
considered part of a Fund's holdings of investment-grade securities, they must
be judged by the Manager to be of comparable quality to bonds rated as
investment grade by a rating organization.

o U.S. Government Securities. These are securities issued or guaranteed by the
U.S. Treasury or other government agencies or federally-chartered corporate
entities referred to as "instrumentalities." The obligations of U.S. government
agencies or instrumentalities in which the Funds may invest may or may not be
guaranteed or supported by the "full faith and credit" of the United States.
"Full faith and credit," means generally that the taxing power of the U.S.
government is pledged to the payment of interest and repayment of principal on a
security. If a security is not backed by the full faith and credit of the United
States, the owner of the security must look principally to the agency issuing
the obligation for repayment. The owner might not be able to assert a claim
against the United States if the issuing agency or instrumentality does not meet
its commitment. The Funds will invest in securities of U.S. government agencies
and instrumentalities only if the Manager is satisfied that the credit risk with
respect to the agency or instrumentality is minimal.

o U.S. Treasury Obligations. These include Treasury bills (maturities of one
year or less when issued), Treasury notes (maturities of one to 10 years), and
Treasury bonds (maturities of more than 10 years). Treasury securities are
backed by the full faith and credit of the United States as to timely payments
of interest and repayments of principal. They also can include U.S. Treasury
securities that have been "stripped" by a Federal Reserve Bank, zero-coupon U.S.
Treasury securities described below, and Treasury Inflation-Protection
Securities ("TIPS").

o Treasury Inflation-Protection Securities. The Funds can buy these TIPS, which
are designed to provide an investment vehicle that is not vulnerable to
inflation. The interest rate paid by TIPS is fixed. The principal value rises or
falls semi-annually based on changes in the published Consumer Price Index. If
inflation occurs, the principal and interest payments on TIPS are adjusted to
protect investors from inflationary loss. If deflation occurs, the principal and
interest payments will be adjusted downward, although the principal will not
fall below its face amount at maturity.

o Obligations Issued or Guaranteed by U.S. Government Agencies or
Instrumentalities. These include direct obligations and mortgage-related
securities that have different levels of credit support from the government.
Some are supported by the full faith and credit of the U.S. government, such as
Government National Mortgage Association ("GNMA") pass-through mortgage
certificates (called "Ginnie Maes"). Some are supported by the right of the
issuer to borrow from the U.S. Treasury under certain circumstances, such as
Federal National Mortgage Association bonds ("Fannie Maes"). Others are
supported only by the credit of the entity that issued them, such as Federal
Home Loan Mortgage Corporation ("FHLMC") obligations ("Freddie Macs").

|X| U.S. Government Mortgage-Related Securities. The Funds can invest in a
variety of mortgage-related securities that are issued by U.S. government
agencies or instrumentalities, some of which are described below.

o GNMA Certificates. The Government National Mortgage Association is a
wholly-owned corporate instrumentality of the United States within the U.S.
Department of Housing and Urban Development. GNMA's principal programs involve
its guarantees of privately-issued securities backed by pools of mortgages.
Ginnie Maes are debt securities representing an interest in one mortgage or a
pool of mortgages that are insured by the Federal Housing Administration ("FHA")
or the Farmers Home Administration ("FMHA") or guaranteed by the Veterans
Administration ("VA").

      The Ginnie Maes in which the Funds invest are of the "fully modified
pass-through" type. They provide that the registered holders of the Ginnie Maes
will receive timely monthly payments of the pro-rata share of the scheduled
principal payments on the underlying mortgages, whether or not those amounts are
collected by the issuers. Amounts paid include, on a pro rata basis, any
prepayment of principal of such mortgages and interest (net of servicing and
other charges) on the aggregate unpaid principal balance of the Ginnie Maes,
whether or not the interest on the underlying mortgages has been collected by
the issuers.

      The Ginnie Maes purchased by the Funds are guaranteed as to timely payment
of principal and interest by GNMA. In giving that guaranty, GNMA expects that
payments received by the issuers of Ginnie Maes on account of the mortgages
backing the Ginnie Maes will be sufficient to make the required payments of
principal of and interest on those Ginnie Maes. However, if those payments are
insufficient, the guaranty agreements between the issuers of the Ginnie Maes and
GNMA require the issuers to make advances sufficient for the payments. If the
issuers fail to make those payments, GNMA will do so.

      Under federal law, the full faith and credit of the United States is
pledged to the payment of all amounts that may be required to be paid under any
guaranty issued by GNMA as to such mortgage pools. An opinion of an Assistant
Attorney General of the United States, dated December 9, 1969, states that such
guaranties "constitute general obligations of the United States backed by its
full faith and credit." GNMA is empowered to borrow from the United States
Treasury to the extent necessary to make any payments of principal and interest
required under those guaranties.

      Ginnie Maes are backed by the aggregate indebtedness secured by the
underlying FHA-insured, FMHA-insured or VA-guaranteed mortgages. Except to the
extent of payments received by the issuers on account of such mortgages, Ginnie
Maes do not constitute a liability of those issuers, nor do they evidence any
recourse against those issuers. Recourse is solely against GNMA. Holders of
Ginnie Maes (such as the Funds) have no security interest in or lien on the
underlying mortgages.

      Monthly payments of principal will be made, and additional prepayments of
principal may be made, to the Fund with respect to the mortgages underlying the
Ginnie Maes owned by the Fund. All of the mortgages in the pools relating to the
Ginnie Maes in the Funds are subject to prepayment without any significant
premium or penalty, at the option of the mortgagors. While the mortgages on
one-to-four family dwellings underlying certain Ginnie Maes have a stated
maturity of up to 30 years, it has been the experience of the mortgage industry
that the average life of comparable mortgages, as a result of prepayments,
refinancing and payments from foreclosures, is considerably less.

o Federal Home Loan Mortgage Corporation (Freddie Mac) Certificates. FHLMC, a
corporate instrumentality of the United States, issues FHLMC Certificates
representing interests in mortgage loans. FHLMC guarantees to each registered
holder of a FHLMC Certificate timely payment of the amounts representing a
holder's proportionate share in:
(i) interest payments less servicing and guarantee fees, (ii) principal
prepayments, and (iii) the ultimate collection of amounts representing the
holder's
            proportionate interest in principal payments on the mortgage loans
            in the pool represented by the FHLMC Certificate, in each case
            whether or not such amounts are actually received.

      The obligations of FHLMC under its guarantees are obligations solely of
FHLMC and are not backed by the full faith and credit of the United States.

o Federal National Mortgage Association (Fannie Mae) Certificates. Fannie Mae, a
federally-chartered and privately-owned corporation, issues Fannie Mae
Certificates which are backed by a pool of mortgage loans. Fannie Mae guarantees
to each registered holder of a Fannie Mae Certificate that the holder will
receive amounts representing the holder's proportionate interest in scheduled
principal and interest payments, and any principal prepayments, on the mortgage
loans in the pool represented by such Certificate, less servicing and guarantee
fees, and the holder's proportionate interest in the full principal amount of
any foreclosed or other liquidated mortgage loan. In each case the guarantee
applies whether or not those amounts are actually received. The obligations of
Fannie Mae under its guarantees are obligations solely of Fannie Mae and are not
backed by the full faith and credit of the United States or any of its agencies
or instrumentalities other than Fannie Mae.

o Commercial (Privately-Issued) Mortgage Related Securities. The Funds can
invest in commercial mortgage-related securities issued by private entities.
Generally these are multi-class debt or pass-through certificates secured by
mortgage loans on commercial properties. They are subject to the credit risk of
the issuer. These securities typically are structured to provide protection to
investors in senior classes from possible losses on the underlying loans. They
do so by having holders of subordinated classes take the first loss if there are
defaults on the underlying loans. They may also be protected to some extent by
guarantees, reserve funds or additional collateralization mechanisms.

      |X| Participation Interests. The Funds can invest in participation
interests, subject to the Fund's limitation on investments in illiquid
investments. A participation interest is an undivided interest in a loan made by
the issuing financial institution in the proportion that the buyer's
participation interest bears to the total principal amount of the loan. Not more
than 5% of the Fund's net assets can be invested in participation interests of
the same borrower. The issuing financial institution may have no obligation to
the Fund other than to pay the Fund the proportionate amount of the principal
and interest payments it receives.

      Participation interests are primarily dependent upon the creditworthiness
of the borrowing corporation, which is obligated to make payments of principal
and interest on the loan. There is a risk that a borrower may have difficulty
making payments. If a borrower fails to pay scheduled interest or principal
payments, the Fund could experience a reduction in its income. The value of that
participation interest might also decline, which could affect the net asset
value of the Fund's shares. If the issuing financial institution fails to
perform its obligations under the participation agreement, the Fund might incur
costs and delays in realizing payment and suffer a loss of principal and/or
interest.

|X|   Zero-Coupon U.S. Government Securities. The Funds may buy zero-coupon
U.S. government securities. These will typically be U.S. Treasury Notes and
Bonds that have been stripped of their unmatured interest coupons, the
coupons themselves, or certificates representing interests in those stripped
debt obligations and coupons.

      Zero-coupon securities do not make periodic interest payments and are sold
at a deep discount from their face value at maturity. The buyer recognizes a
rate of return determined by the gradual appreciation of the security, which is
redeemed at face value on a specified maturity date. This discount depends on
the time remaining until maturity, as well as prevailing interest rates, the
liquidity of the security and the credit quality of the issuer. The discount
typically decreases as the maturity date approaches.

      Because zero-coupon securities pay no interest and compound semi-annually
at the rate fixed at the time of their issuance, their value is generally more
volatile than the value of other debt securities that pay interest. Their value
may fall more dramatically than the value of interest-bearing securities when
interest rates rise. When prevailing interest rates fall, zero-coupon securities
tend to rise more rapidly in value because they have a fixed rate of return.

      A Fund's investment in zero-coupon securities may cause the Fund to
recognize income and make distributions to shareholders before it receives any
cash payments on the zero-coupon investment. To generate cash to satisfy those
distribution requirements, a Fund may have to sell portfolio securities that it
otherwise might have continued to hold or to use cash flows from other sources
such as the sale of Fund shares.

o Special Risks of Lower-Grade Securities. Because lower-grade securities tend
to offer higher yields than investment grade securities, a Fund may invest in
lower grade securities if the Manager is trying to achieve greater income (and,
in some cases, the appreciation possibilities of lower-grade securities may be a
reason they are selected for a Fund's portfolio).

      Some of the special credit risks of lower-grade securities are discussed
in the Prospectus. There is a greater risk that the issuer may default on its
obligation to pay interest or to repay principal than in the case of
investment-grade securities. The issuer's low creditworthiness may increase the
potential for its insolvency. An overall decline in values in the high yield
bond market is also more likely during a period of a general economic downturn.
An economic downturn or an increase in interest rates could severely disrupt the
market for high yield bonds, adversely affecting the values of outstanding bonds
as well as the ability of issuers to pay interest or repay principal. In the
case of foreign high yield bonds, these risks are in addition to the special
risk of foreign investing discussed in the Prospectus and in this Statement of
Additional Information.

      While securities rated "Baa" by Moody's or "BBB" by Standard & Poor's or
Fitch are investment-grade and are not regarded as junk bonds, those securities
may be subject to special risks, and have some speculative characteristics.
Definitions of the debt security ratings categories of Moody's, Standard &
Poor's and Fitch are included in Appendix A to this Statement of Additional
Information.

o Interest Rate Risk. Interest rate risk refers to the fluctuations in value of
fixed-income securities resulting from the inverse relationship between price
and yield. For example, an increase in general interest rates will tend to
reduce the market value of already-issued fixed-income investments, and a
decline in general interest rates will tend to increase their value. In
addition, debt securities with longer maturities, which tend to have higher
yields, are subject to potentially greater fluctuations in value from changes in
interest rates than obligations with shorter maturities.

      Fluctuations in the market value of fixed-income securities after the
Funds buy them will not affect the interest income payable on those securities
(unless the security pays interest at a variable rate pegged to interest rate
changes). However, those price fluctuations will be reflected in the valuations
of the securities, and therefore the Funds' net asset values will be affected by
those fluctuations.

      |X| Floating Rate and Variable Rate Obligations. Some securities the Funds
can purchase have variable or floating interest rates. Variable rates are
adjusted at stated periodic intervals. Variable rate obligations can have a
demand feature that allows the Funds to tender the obligation to the issuer or a
third party prior to its maturity. The tender may be at par value plus accrued
interest, according to the terms of the obligations.

      The interest rate on a floating rate demand note is adjusted automatically
according to a stated prevailing market rate, such as a bank's prime rate, the
91-day U.S. Treasury Bill rate, or some other standard. The instrument's rate is
adjusted automatically each time the base rate is adjusted. The interest rate on
a variable rate note is also based on a stated prevailing market rate but is
adjusted automatically at specified intervals of not less than one year.
Generally, the changes in the interest rate on such securities reduce the
fluctuation in their market value. As interest rates decrease or increase, the
potential for capital appreciation or depreciation is less than that for
fixed-rate obligations of the same maturity. The Manager may determine that an
unrated floating rate or variable rate demand obligation meets the Funds'
quality standards by reason of being backed by a letter of credit or guarantee
issued by a bank that meets those quality standards.

      Floating rate and variable rate demand notes that have a stated maturity
in excess of one year may have features that permit the holder to recover the
principal amount of the underlying security at specified intervals not exceeding
one year and upon no more than 30 days' notice. The issuer of that type of note
normally has a corresponding right in its discretion, after a given period, to
prepay the outstanding principal amount of the note plus accrued interest.
Generally, the issuer must provide a specified number of days' notice to the
holder.

      |X| Asset-Backed Securities. Asset-backed securities are fractional
interests in pools of assets, typically accounts receivable or consumer loans.
They are issued by trusts or special-purpose corporations. They are similar to
mortgage-backed securities, described below, and are backed by a pool of assets
that consist of obligations of individual borrowers. The income from the pool is
passed through to the holders of participation interest in the pools. The pools
may offer a credit enhancement, such as a bank letter of credit, to try to
reduce the risks that the underlying debtors will not pay their obligations when
due. However, the enhancement, if any, might not be for the full par value of
the security. If the enhancement is exhausted and any required payments of
interest or repayments of principal are not made, that Fund could suffer losses
on its investment or delays in receiving payment.

      The value of an asset-backed security is affected by changes in the
market's perception of the asset backing the security, the creditworthiness of
the servicing agent for the loan pool, the originator of the loans, or the
financial institution providing any credit enhancement, and is also affected if
any credit enhancement has been exhausted. The risks of investing in
asset-backed securities are ultimately related to payment of consumer loans by
the individual borrowers. As a purchaser of an asset-backed security, a Fund
would generally have no recourse to the entity that originated the loans in the
event of default by a borrower. The underlying loans are subject to prepayments,
which may shorten the weighted average life of asset-backed securities and may
lower their return, in the same manner as in the case of mortgage-backed
securities and CMOs, described below. Unlike mortgage-backed securities,
asset-backed securities typically do not have the benefit of a security interest
in the underlying collateral.

      |X| Mortgage-Related Securities. Mortgage-related securities (also
referred to as mortgage-backed securities) are a form of derivative investment
collateralized by pools of commercial or residential mortgages. Pools of
mortgage loans are assembled as securities for sale to investors by government
agencies or entities or by private issuers. These securities include
collateralized mortgage obligations ("CMOs"), mortgage pass-through securities,
stripped mortgage pass-through securities, interests in real estate mortgage
investment conduits ("REMICs") and other real-estate related securities.

      Mortgage-related securities that are issued or guaranteed by agencies or
instrumentalities of the U.S. government have relatively little credit risk
(depending on the nature of the issuer). Privately issued mortgage-related
securities have some credit risk, as the underlying mortgage may not fully
collateralize the obligation and full payment of them is not guaranteed. Both
types of mortgage-related securities are subject to interest rate risks and
prepayment risks, as described in the Prospectuses.

      As with other debt securities, the prices of mortgage-related securities
tend to move inversely to changes in interest rates. The Fixed Income Funds and
Value Fund/VA can buy mortgage-related securities that have interest rates that
move inversely to changes in general interest rates, based on a multiple of a
specific index. Although the value of a mortgage-related security may decline
when interest rates rise, the converse is not always the case.

      In periods of declining interest rates, mortgages are more likely to be
prepaid. Therefore, a mortgage-related security's maturity can be shortened by
unscheduled prepayments on the underlying mortgages. Therefore, it is not
possible to predict accurately the security's yield. The principal that is
returned earlier than expected may have to be reinvested in other investments
having a lower yield than the prepaid security. Therefore, these securities may
be less effective as a means of "locking in" attractive long-term interest
rates, and they may have less potential for appreciation during periods of
declining interest rates, than conventional bonds with comparable stated
maturities.

      Prepayment risks can lead to substantial fluctuations in the value of a
mortgage-related security. In turn, this can affect the value of that Fund's
shares. If a mortgage-related security has been purchased at a premium, all or
part of the premium that Fund paid may be lost if there is a decline in the
market value of the security, whether that results from interest rate changes or
prepayments on the underlying mortgages. In the case of stripped
mortgage-related securities, if they experience greater rates of prepayment than
were anticipated, that Fund may fail to recoup its initial investment on the
security.

      During periods of rapidly rising interest rates, prepayments of
mortgage-related securities may occur at slower than expected rates. Slower
prepayments effectively may lengthen a mortgage-related security's expected
maturity. Generally, that would cause the value of the security to fluctuate
more widely in responses to changes in interest rates. If the prepayments on a
Fund's mortgage-related securities were to decrease broadly, that Fund's
effective duration, and therefore its sensitivity to interest rate changes,
would increase.

      As with other debt securities, the values of mortgage-related securities
may be affected by changes in the market's perception of the creditworthiness of
the entity issuing the securities or guaranteeing them. Their values may also be
affected by changes in government regulations and tax policies.

o Forward Rolls. The Funds can enter into "forward roll" transactions with
respect to mortgage-related securities (also referred to as "mortgage dollar
rolls"). In this type of transaction, a Fund sells a mortgage-related security
to a buyer and simultaneously agrees to repurchase a similar security (the same
type of security, and having the same coupon and maturity) at a later date at a
set price. The securities that are repurchased will have the same interest rate
as the securities that are sold, but typically will be collateralized by
different pools of mortgages (with different prepayment histories) than the
securities that have been sold. Proceeds from the sale are invested in
short-term instruments, such as repurchase agreements. The income from those
investments, plus the fees from the forward roll transaction, are expected to
generate income to a Fund in excess of the yield on the securities that have
been sold.

      The Funds will only enter into "covered" rolls. To assure its future
payment of the purchase price, the Funds will identify on its books liquid
assets in an amount equal to the payment obligation under the roll.

      These transactions have risks. During the period between the sale and the
repurchase, the Fund will not be entitled to receive interest and principal
payments on the securities that have been sold. It is possible that the market
value of the securities the Fund sells may decline below the price at which the
Fund is obligated to repurchase securities.

o     Collateralized Mortgage Obligations. CMOs are multi-class bonds that
are backed by pools of mortgage loans or mortgage pass-through certificates.
They may be collateralized by:
(1)         pass-through certificates issued or guaranteed by Ginnie Mae, Fannie
            Mae, or Freddie Mac,
(2)         unsecuritized mortgage loans insured by the Federal Housing
            Administration or guaranteed by the Department of Veterans' Affairs,
(3)         unsecuritized conventional mortgages, (4) other mortgage-related
            securities, or (5) any combination of these.

      Each class of CMO, referred to as a "tranche," is issued at a specific
coupon rate and has a stated maturity or final distribution date. Principal
prepayments on the underlying mortgages may cause the CMO to be retired much
earlier than the stated maturity or final distribution date. The principal and
interest on the underlying mortgages may be allocated among the several classes
of a series of a CMO in different ways. One or more trenches may have coupon
rates that reset periodically at a specified increase over an index. These are
floating rate CMOs, and typically have a cap on the coupon rate. Inverse
floating rate CMOs have a coupon rate that moves in the reverse direction to an
applicable index. The coupon rate on these CMOs will increase as general
interest rates decrease. These are usually much more volatile than fixed rate
CMOs or floating rate CMOs.

      |X| Foreign Securities. The Equity Funds and the Fixed Income Funds may
invest in foreign securities, and Global Securities Fund/VA expects to have
substantial investments in foreign securities. These include equity securities
issued by foreign companies and debt securities issued or guaranteed by foreign
companies or governments, including supra-national entities. "Foreign
securities" include equity and debt securities of companies organized under the
laws of countries other than the United States and debt securities issued or
guaranteed by governments other than the U.S. government or by foreign
supra-national entities. They also include securities of companies (including
those that are located in the U.S. or organized under U.S. law) that derive a
significant portion of their revenue or profits from foreign businesses,
investments or sales, or that have a significant portion of their assets abroad.
They may be traded on foreign securities exchanges or in the foreign
over-the-counter markets. Value Fund/VA can purchase up to 25% of its total
assets in certain equity and debt securities issued or guaranteed by foreign
companies or of foreign governments or their agencies and as stated in the
Prospectus, the Fund does not concentrate 25% or more of its total assets in the
securities of any one foreign government.

      Securities of foreign issuers that are represented by American Depository
Receipts or that are listed on a U.S. securities exchange or traded in the U.S.
over-the-counter markets are not considered "foreign securities" for the purpose
of a Fund's investment allocations, because they are not subject to many of the
special considerations and risks, discussed below, that apply to foreign
securities traded and held abroad.

      Because the Funds may purchase securities denominated in foreign
currencies, a change in the value of such foreign currency against the U.S.
dollar will result in a change in the amount of income the Funds have available
for distribution. Because a portion of the Funds' investment income may be
received in foreign currencies, the Funds will be required to compute their
income in U.S. dollars for distribution to shareholders, and therefore the Funds
will absorb the cost of currency fluctuations. After the Funds have distributed
income, subsequent foreign currency losses may result in the Fund's having
distributed more income in a particular fiscal period than was available from
investment income, which could result in a return of capital to shareholders.

      Investing in foreign securities offers potential benefits not available
from investing solely in securities of domestic issuers. They include the
opportunity to invest in foreign issuers that appear to offer growth potential,
or in foreign countries with economic policies or business cycles different from
those of the U.S., or to reduce fluctuations in portfolio value by taking
advantage of foreign stock markets that do not move in a manner parallel to U.S.
markets. The Funds will hold foreign currency only in connection with the
purchase or sale of foreign securities.

o Foreign Debt Obligations. The debt obligations of foreign governments and
entities may or may not be supported by the full faith and credit of the foreign
government. The Fixed Income Funds may buy securities issued by certain
supra-national entities, which include entities designated or supported by
governments to promote economic reconstruction or development, international
banking organizations and related government agencies. Examples are the
International Bank for Reconstruction and Development (commonly called the
"World Bank"), the Asian Development bank and the Inter-American Development
Bank.

      The governmental members of these supra-national entities are
"stockholders" that typically make capital contributions and may be committed to
make additional capital contributions if the entity is unable to repay its
borrowings. A supra-national entity's lending activities may be limited to a
percentage of its total capital, reserves and net income. There can be no
assurance that the constituent foreign governments will continue to be able or
willing to honor their capitalization commitments for those entities.

      The Fixed Income Funds can invest in U.S. dollar-denominated "Brady
Bonds." These foreign debt obligations may be fixed-rate par bonds or
floating-rate discount bonds. They are generally collateralized in full as to
repayment of principal at maturity by U.S. Treasury zero-coupon obligations that
have the same maturity as the Brady Bonds. Brady Bonds can be viewed as having
three or four valuation components: (i) the collateralized repayment of
principal at final maturity; (ii) the collateralized interest payments; (iii)
the uncollateralized interest payments; and (iv) any uncollateralized repayment
of principal at maturity. Those uncollateralized amounts constitute what is
called the "residual risk".

      If there is a default on collateralized Brady Bonds resulting in
acceleration of the payment obligations of the issuer, the zero-coupon U.S.
Treasury securities held as collateral for the payment of principal will not be
distributed to investors, nor will those obligations be sold to distribute the
proceeds. The collateral will be held by the collateral agent to the scheduled
maturity of the defaulted Brady Bonds. The defaulted bonds will continue to
remain outstanding, and the face amount of the collateral will equal the
principal payments which would have then been due on the Brady Bonds in the
normal course. Because of the residual risk of Brady Bonds and the history of
defaults with respect to commercial bank loans by public and private entities of
countries issuing Brady Bonds, Brady Bonds are considered speculative
investments.

o Risks of Foreign Investing. Investments in foreign securities may offer
special opportunities for investing but also present special additional risks
and considerations not typically associated with investments in domestic
securities. Some of these additional risks are:
o     reduction of income by foreign taxes;
o     fluctuation in value of foreign investments due to changes in currency
                  rates or currency control regulations (for example,
                  currency blockage);
o     transaction charges for currency exchange;
o     lack of public information about foreign issuers;
o     lack of uniform accounting, auditing and financial reporting standards
                  in foreign countries comparable to those applicable to
                  domestic issuers;
o     less volume on foreign exchanges than on U.S. exchanges;
o     greater volatility and less liquidity on foreign markets than in the
                  U.S.;
o     less governmental regulation of foreign issuers, stock exchanges and
                  brokers than in the U.S.;
o     greater difficulties in commencing lawsuits;
o     higher brokerage commission rates than in the U.S.;
o     increased risks of delays in settlement of portfolio transactions or
                  loss of certificates for portfolio securities;
o     possibilities in some countries of expropriation, confiscatory
                  taxation, currency devaluation, political, financial or
                  social instability or adverse diplomatic developments; and
o     unfavorable differences between the U.S. economy and foreign economies.

      In the past, U.S. government policies have discouraged certain
investments abroad by U.S. investors, through taxation or other restrictions,
and it is possible that such restrictions could be re-imposed.

|X| Passive Foreign Investment Companies. Some securities of corporations
domiciled outside the U.S. which the Fund may purchase, may be considered
passive foreign investment companies ("PFICs") under U.S. tax laws. PFICs are
those foreign corporations which generate primarily passive income. They tend to
be growth companies or "start-up" companies. For federal tax purposes, a
corporation is deemed a PFIC if 75% or more of the foreign corporation's gross
income for the income year is passive income or if 50% or more of its assets are
assets that produce or are held to produce passive income. Passive income is
further defined as any income to be considered foreign personal holding company
income within the subpart F provisions defined by IRC ss.954.

      Investing in PFICs involves the risks associated with investing in foreign
securities, as described above. There are also the risks that the Fund may not
realize that a foreign corporation it invests in is a PFIC for federal tax
purposes. Federal tax laws impose severe tax penalties for failure to properly
report investment income from PFICs. Following industry standards, the Fund
makes every effort to ensure compliance with federal tax reporting of these
investments. PFICs are considered foreign securities for the purposes of the
Fund's minimum percentage requirements or limitations of investing in foreign
securities.

      Subject to the limits under the Investment Company Act of 1940 (the
"Investment Company Act"), the Fund may also invest in foreign mutual funds
which are also deemed PFICs (since nearly all of the income of a mutual fund is
generally passive income). Investing in these types of PFICs may allow exposure
to various countries because some foreign countries limit, or prohibit, all
direct foreign investment in the securities of companies domiciled therein.

      In addition to bearing their proportionate share of a fund's expenses
(management fees and operating expenses), shareholders will also indirectly bear
similar expenses of such entities. Additional risks of investing in other
investment companies are described below under "Investment in Other Investment
Companies."

o Special Risks of Emerging Markets. Emerging and developing markets abroad may
also offer special opportunities for growth investing but have greater risks
than more developed foreign markets, such as those in Europe, Canada, Australia,
New Zealand and Japan. There may be even less liquidity in their securities
markets, and settlements of purchases and sales of securities may be subject to
additional delays. They are subject to greater risks of limitations on the
repatriation of income and profits because of currency restrictions imposed by
local governments. Those countries may also be subject to the risk of greater
political and economic instability, which can greatly affect the volatility of
prices of securities in those countries. The Manager will consider these factors
when evaluating securities in these markets, because the selection of those
securities must be consistent with the Fund's goal of preservation of principal.

      |X| Portfolio Turnover. "Portfolio turnover" describes the rates at which
the Funds traded their portfolio securities during their last fiscal year. For
example, if a Fund sold all of its securities during the year, its portfolio
turnover rate would have been 100%. The Funds' portfolio turnover rates will
fluctuate from year to year, and any of the Funds may have portfolio turnover
rates of more than 100% annually.

      Balanced Fund/VA's portfolio turnover rate decreased significantly
compared to its previous fiscal year. Balanced Fund/VA's portfolio managers
began managing the fund in January 2003. During Balanced Fund/VA's 2003 fiscal
year, the portfolio managers of the equity portion of the fund reduced its
equity holdings significantly, consistent with their management style. In
addition, the portfolio managers of the fixed income portion of the Balanced
Fund/VA had entered into an increased number of forward roll transactions, due
to their belief that the market offered attractive return potential to do so.
These changes increased portfolio turnover for the fund's fiscal year 2003.
Because the portfolio managers made these investment changes primarily in fiscal
year 2003, the fund's portfolio turnover rate decreased significantly for the
fund's fiscal year 2004 compared with fiscal year 2003.

Other Investment Techniques and Strategies. In seeking their respective
objectives, the Funds may from time to time use the types of investment
strategies and investments described below. They are not required to use all of
these strategies at all times, and at times may not use them.

      |X| Investing in Small, Unseasoned Companies. The Funds may invest in
securities of small, unseasoned companies, subject to limits (if any) stated in
that Fund's Prospectus. These are companies that have been in operation for less
than three years, including the operations of any predecessors. Securities of
these companies may be subject to volatility in their prices. They may have a
limited trading market or no trading market, which may adversely affect the
Funds' ability to value them or to dispose of them and can reduce the price the
Funds might be able to obtain for them. Other investors that own a security
issued by a small, unseasoned issuer for which there is limited liquidity might
trade the security when the Funds are attempting to dispose of their holdings of
that security. In that case, a Fund might receive a lower price for its holdings
than might otherwise be obtained.

      |X| When-Issued and Delayed-Delivery Transactions (All Portfolios). The
Funds may invest in securities on a "when-issued" basis and may purchase or sell
securities on a "delayed-delivery" or "forward commitment" basis. When-issued
and delayed-delivery are terms that refer to securities whose terms and
indenture are available and for which a market exists, but which are not
available for immediate delivery.

      When such transactions are negotiated, the price (which is generally
expressed in yield terms) is fixed at the time the commitment is made. Delivery
and payment for the securities take place at a later date. The securities are
subject to change in value from market fluctuations during the period until
settlement. The value at delivery may be less than the purchase price. For
example, changes in interest rates in a direction other than that expected by
the Manager before settlement will affect the value of such securities and may
cause a loss to the Funds. During the period between purchase and settlement, no
payment is made by the Funds to the issuer and no interest accrues to that
portfolio from the investment. No income begins to accrue to the Funds on a
when-issued security until the Funds receive the security at settlement of the
trade.

      The Funds will engage in when-issued transactions to secure what the
Manager considers to be an advantageous price and yield at the time of entering
into the obligation. When a Fund enters into a when-issued or delayed-delivery
transaction, it relies on the other party to complete the transaction. Its
failure to do so may cause that Fund to lose the opportunity to obtain the
security at a price and yield the Manager considers to be advantageous.

      When a Fund engages in when-issued and delayed-delivery transactions, it
does so for the purpose of acquiring or selling securities consistent with its
investment objective and policies for its portfolio or for delivery pursuant to
options contracts it has entered into, and not for the purpose of investment
leverage. Although a Fund will enter into delayed-delivery or when-issued
purchase transactions to acquire securities, it may dispose of a commitment
prior to settlement. If a Fund chooses to dispose of the right to acquire a
when-issued security prior to its acquisition or to dispose of its right to
delivery against a forward commitment, it may incur a gain or loss.

      At the time a Fund makes the commitment to purchase or sell a security on
a when-issued or delayed delivery basis, it records the transaction on its books
and reflects the value of the security purchased in determining that Fund's net
asset value. In a sale transaction, it records the proceeds to be received. That
Fund will identify on its books liquid assets at least equal in value to the
value of that Fund's purchase commitments until that Fund pays for the
investment.

      When-issued and delayed-delivery transactions can be used by the Funds as
a defensive technique to hedge against anticipated changes in interest rates and
prices. For instance, in periods of rising interest rates and falling prices, a
Fund might sell securities in its portfolio on a forward commitment basis to
attempt to limit its exposure to anticipated falling prices. In periods of
falling interest rates and rising prices, a Fund might sell portfolio securities
and purchase the same or similar securities on a when-issued or delayed-delivery
basis to obtain the benefit of currently higher cash yields.

      |X| Zero-Coupon Securities. The Fixed Income Funds may buy zero-coupon and
delayed interest securities, and "stripped" securities of foreign government
issuers, which may or may not be backed by the "full faith and credit" of the
issuing foreign government, and of domestic and foreign corporations. The Fixed
Income Funds and Value Fund/VA may also buy zero-coupon and "stripped" U.S.
government securities. Zero-coupon securities issued by foreign governments and
by corporations will be subject to greater credit risks than U.S. government
zero-coupon securities.

      |X| "Stripped" Mortgage-Related Securities. The Fixed Income Funds and
Value Fund/VA can invest in stripped mortgage-related securities that are
created by segregating the cash flows from underlying mortgage loans or mortgage
securities to create two or more new securities. Each has a specified percentage
of the underlying security's principal or interest payments. These are a form of
derivative investment.

      Mortgage securities may be partially stripped so that each class receives
some interest and some principal. However, they may be completely stripped. In
that case all of the interest is distributed to holders of one type of security,
known as an "interest-only" security, or "I/O," and all of the principal is
distributed to holders of another type of security, known as a "principal-only"
security or "P/O." Strips can be created for pass-through certificates or CMOs.

      The yields to maturity of I/Os and P/Os are very sensitive to principal
repayments (including prepayments) on the underlying mortgages. If the
underlying mortgages experience greater than anticipated prepayments of
principal, that Fund might not fully recoup its investment in an I/O based on
those assets. If underlying mortgages experience less than anticipated
prepayments of principal, the yield on the P/Os based on them could decline
substantially.

      |X| Repurchase Agreements. The Funds may acquire securities subject to
repurchase agreements. They may do so for liquidity purposes to meet anticipated
redemptions of Fund shares, or pending the investment of the proceeds from sales
of Fund shares, or pending the settlement of portfolio securities transactions,
or for temporary defensive purposes, as described below.

      In a repurchase transaction, the Funds buy a security from, and
simultaneously resell it to, an approved vendor for delivery on an agreed-upon
future date. The resale price exceeds the purchase price by an amount that
reflects an agreed-upon interest rate effective for the period during which the
repurchase agreement is in effect. Approved vendors include U.S. commercial
banks, U.S. branches of foreign banks, or broker-dealers that have been
designated as primary dealers in government securities. They must meet credit
requirements set by the Manager from time to time.

      The majority of these transactions run from day to day, and delivery
pursuant to the resale typically occurs within one to five days of the purchase.
Repurchase agreements having a maturity beyond seven days are subject to each
Fund's limit on holding illiquid investments. No Fund will enter into a
repurchase agreement that causes more than 15% of its net assets (for Value
Fund/VA and Money Fund/VA, 10%) to be subject to repurchase agreements having a
maturity beyond seven days. There is no limit on the amount of a Fund's net
assets that may be subject to repurchase agreements having maturities of seven
days or less for defensive purposes.

      Repurchase agreements, considered "loans" under the Investment Company
Act, are collateralized by the underlying security. The Funds' repurchase
agreements require that at all times while the repurchase agreements are in
effect, the value of the collateral must equal or exceed the repurchase price to
fully collateralize the repayment obligation. However, if the vendor fails to
pay the resale price on the delivery date, the Funds may incur costs in
disposing of the collateral and may experience losses if there is any delay in
its ability to do so. The Manager will monitor the vendor's creditworthiness to
confirm that the vendor is financially sound and will continuously monitor the
collateral's value.

      Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission (the "SEC"), the Funds, along with other affiliated entities managed
by the Manager, may transfer uninvested cash balances into one or more joint
repurchase accounts. These balances are invested in one or more repurchase
agreements, secured by U.S. government securities. Securities that are
collateral for repurchase agreements are financial assets subject to the Fund's
entitlement orders through its securities account at its custodian bank until
the agreements mature. Each joint repurchase arrangement requires that the
market value of the collateral be sufficient to cover payments of interest and
principal; however, in the event of default by the other party to the agreement,
retention or sale of the collateral may be subject to legal proceedings.

      |X| Illiquid and Restricted Securities. Under the policies and procedures
established by the Fund's Board of Trustees, the Manager determines the
liquidity of certain of the Funds' investments. To enable a Fund to sell its
holdings of a restricted security not registered under the Securities Act of
1933, as amended (the "Securities Act"), that Fund may have to cause those
securities to be registered. The expenses of registering restricted securities
may be negotiated by the Fund with the issuer at the time the Fund buys the
securities. When a Fund must arrange registration because the Fund wishes to
sell the security, a considerable period may elapse between the time the
decision is made to sell the security and the time the security is registered so
that the Fund could sell it. That Fund would bear the risks of any downward
price fluctuation during that period.

      The Funds may also acquire restricted securities through private
placements. Those securities have contractual restrictions on their public
resale. Those restrictions might limit a Fund's ability to dispose of the
securities and might lower the amount a Fund could realize upon the sale.

      The Funds have limitations that apply to purchases of restricted
securities, as stated in the Prospectus. Those percentage restrictions do not
limit purchases of restricted securities that are eligible for sale to qualified
institutional purchasers under Rule 144A of the Securities Act, if those
securities have been determined to be liquid by the Manager under Board-approved
guidelines. Those guidelines take into account the trading activity for such
securities and the availability of reliable pricing information, among other
factors. If there is a lack of trading interest in a particular Rule 144A
security, the Funds' holdings of that security may be considered to be illiquid.

      Illiquid securities include repurchase agreements maturing in more than
seven days and participation interests that do not have puts exercisable within
seven days.

|X| Loans of Portfolio Securities. To raise cash for liquidity purposes or for
income, the Fund can lend its portfolio securities to brokers, dealers and other
types of financial institutions approved by the Fund's Board of Trustees.

      The Fund may lend its portfolio securities pursuant to the Securities
Lending Agreement (the "Securities Lending Agreement") with JP Morgan Chase,
subject to the restrictions stated in the Prospectus. The Fund will lend such
portfolio securities to attempt to increase the Fund's income. Under the
Securities Lending Agreement and applicable regulatory requirements (which are
subject to change), the loan collateral must, on each business day, be at least
equal to the value of the loaned securities and must consist of cash, bank
letters of credit or securities of the U.S. Government (or its agencies or
instrumentalities), or other cash equivalents in which the Fund is permitted to
invest. To be acceptable as collateral, letters of credit must obligate a bank
to pay to JP Morgan Chase, as agent, amounts demanded by the Fund if the demand
meets the terms of the letter. Such terms of the letter of credit and the
issuing bank must be satisfactory to JP Morgan Chase and the Fund. The Fund will
receive, pursuant to the Securities Lending Agreement, 80% of all annual net
income (i.e., net of rebates to the Borrower) from securities lending
transactions. JP Morgan Chase has agreed, in general, to guarantee the
obligations of borrowers to return loaned securities and to be responsible for
expenses relating to securities lending. The Fund will be responsible, however,
for risks associated with the investment of cash collateral, including the risk
that the issuer of the security in which the cash collateral has been invested
in defaults. The Securities Lending Agreement may be terminated by either JP
Morgan Chase or the Fund on 30 days' written notice. The terms of the Fund's
loans must also meet applicable tests under the Internal Revenue Code and permit
the Fund to reacquire loaned securities on five business days' notice or in time
to vote on any important matter.

      There are some risks in connection with securities lending. The Funds
might experience a delay in receiving additional collateral to secure a loan, or
a delay in recovery of the loaned securities if the borrower defaults. The Funds
must receive collateral for a loan. Under current applicable regulatory
requirements (which are subject to change), on each business day the loan
collateral must be at least equal to the value of the loaned securities. It must
consist of cash, bank letters of credit, or securities of the U.S. government or
its agencies or instrumentalities, or other cash equivalents in which that Fund
is permitted to invest. To be acceptable as collateral, letters of credit must
obligate a bank to pay amounts demanded by the Funds if the demand meets the
terms of the letter. The terms of the letter of credit and the issuing bank both
must be satisfactory to the Funds.

      When they lend securities, that Fund receives amounts equal to the
dividends or interest on loaned securities. It also receives one or more of (a)
negotiated loan fees, (b) interest on securities used as collateral, and (c)
interest on any short-term debt securities purchased with such loan collateral.
Either type of interest may be shared with the borrower. That Fund may also pay
reasonable finder's, custodian and administrative fees in connection with these
loans. The terms of a Fund's loans must meet applicable tests under the Internal
Revenue Code and must permit the Fund to reacquire loaned securities on five
days' notice or in time to vote on any important matter.

      |X| Borrowing and Leverage. Each Fund has the ability to borrow from banks
on an unsecured basis. Each Fund has undertaken to limit borrowing to 25% of the
value of that Fund's net assets, which is further limited to 10% if borrowing is
for a purpose other than to facilitate redemptions. Investing borrowed funds in
portfolio securities is a speculative technique known as "leverage." The Funds
cannot borrow money in excess of 33-1/3% of the value of that Fund's total
assets. The Funds may borrow only from banks and/or affiliated investment
companies. With respect to this fundamental policy, the Funds can borrow only if
they maintain a 300% ratio of assets to borrowings at all times in the manner
set forth in the Investment Company Act. If the value of that Fund's assets
fails to meet this 300% asset coverage requirement, that Fund will reduce its
bank debt within three days to meet the requirement. To do so, that Fund might
have to sell a portion of its investments at a disadvantageous time.

      A Fund will pay interest on these loans, and that interest expense will
raise the overall expenses of that Fund and reduce its returns. If it does
borrow, its expenses will be greater than comparable funds that do not borrow
for leverage. Additionally, that Fund's net asset values per share might
fluctuate more than that of funds that do not borrow. Currently, the Funds do
not contemplate using this technique in the next year but if they do so, it will
not likely be to a substantial degree.

         o Bank Obligations. The Funds can buy time deposits, certificates of
deposit and bankers' acceptances. They must be: o obligations issued or
guaranteed by a domestic bank (including a
               foreign branch of a domestic bank) having total assets of at
               least U.S. $1 billion, or
o     obligations of a foreign bank with total assets of at least U.S. $1
               billion.

      "Banks" include commercial banks, savings banks and savings and loan
associations, which may or may not be members of the Federal Deposit Insurance
Corporation.

         o Commercial Paper. The Funds can invest in commercial paper if it is
rated within the top three rating categories of S&P and Moody's or other rating
organizations.

      If the paper is not rated, it may be purchased if the Manager determines
that it is comparable to rated commercial paper in the top three rating
categories of national rating organizations.

      The Funds can buy commercial paper, including U.S. dollar-denominated
securities of foreign branches of U.S. banks, issued by other entities if the
commercial paper is guaranteed as to principal and interest by a bank,
government or corporation whose certificates of deposit or commercial paper may
otherwise be purchased by the Funds.

         o Variable Amount Master Demand Notes. Master demand notes are
corporate obligations that permit the investment of fluctuating amounts by the
Funds at varying rates of interest under direct arrangements between the Funds,
as lender, and the borrower. They permit daily changes in the amounts borrowed.
The Funds have the right to increase the amount under the note at any time up to
the full amount provided by the note agreement, or to decrease the amount. The
borrower may prepay up to the full amount of the note without penalty. These
notes may or may not be backed by bank letters of credit.

      Because these notes are direct lending arrangements between the lender and
borrower, it is not expected that there will be a trading market for them. There
is no secondary market for these notes, although they are redeemable (and thus
are immediately repayable by the borrower) at principal amount, plus accrued
interest, at any time. Accordingly, the Fund's right to redeem such notes is
dependent upon the ability of the borrower to pay principal and interest on
demand.

      The Funds have no limitations on the type of issuer from whom these notes
will be purchased. However, in connection with such purchases and on an ongoing
basis, the Manager will consider the earning power, cash flow and other
liquidity ratios of the issuer, and its ability to pay principal and interest on
demand, including a situation in which all holders of such notes made demand
simultaneously. Investments in master demand notes are subject to the limitation
on investments by the Fund in illiquid securities, described in the Prospectus.
Currently, the Fund does not intend that its investments in variable amount
master demand notes will exceed 5% of its total assets.

      |X| Derivatives. The Funds can invest in a variety of derivative
investments for hedging purposes. Some derivative investments the Funds can use
are the hedging instruments described below in this Statement of Additional
Information. The Equity Funds do not use, and do not currently contemplate
using, derivatives or hedging instruments to a significant degree in the coming
year and they are not obligated to use them in seeking their objectives.

      Other derivative investments the Fixed Income Funds can invest in include
"index-linked" notes. Principal and/or interest payments on these notes depend
on the performance of an underlying index. Currency-indexed securities are
another derivative these Funds may use. Typically, these are short-term or
intermediate-term debt securities. Their value at maturity or the rates at which
they pay income are determined by the change in value of the U.S. dollar against
one or more foreign currencies or an index. In some cases, these securities may
pay an amount at maturity based on a multiple of the amount of the relative
currency movements. This type of index security offers the potential for
increased income or principal payments but at a greater risk of loss than a
typical debt security of the same maturity and credit quality.

      Other derivative investments the Fixed Income Funds can use include debt
exchangeable for common stock of an issuer or "equity-linked debt securities" of
an issuer. At maturity, the debt security is exchanged for common stock of the
issuer or it is payable in an amount based on the price of the issuer's common
stock at the time of maturity. Both alternatives present a risk that the amount
payable at maturity will be less than the principal amount of the debt because
the price of the issuer's common stock might not be as high as the Manager
expected.

|X| Hedging. Although the Funds can use hedging instruments, they are not
obligated to use them in seeking their objective. To attempt to protect against
declines in the market value of the Funds' portfolio, to permit the Funds to
retain unrealized gains in the value of portfolio securities which have
appreciated, or to facilitate selling securities for investment reasons, the
Funds could:
o     sell futures contracts,
o     buy puts on such futures or on securities, or
o           write covered calls on securities or futures. Covered calls may also
            be used to increase the Funds' income, but the Manager does not
            expect to engage extensively in that practice.

      The Funds can use hedging to establish a position in the securities market
as a temporary substitute for purchasing particular securities. In that case the
Funds would normally seek to purchase the securities and then terminate that
hedging position. The Funds might also use this type of hedge to attempt to
protect against the possibility that its portfolio securities would not be fully
included in a rise in value of the market. To do so the Funds could:
o     buy futures, or
o     buy calls on such futures or on securities.

      The Funds' strategy of hedging with futures and options on futures will be
incidental to the Fund's activities in the underlying cash market. The
particular hedging instruments the Funds can use are described below. The Funds
may employ new hedging instruments and strategies when they are developed, if
those investment methods are consistent with the Funds' investment objective and
are permissible under applicable regulations governing the Funds.

o Futures. The Funds can buy and sell futures contracts that relate to (1)
broadly-based stock indices (these are referred to as "stock index futures"),
(2) an individual stock ("single stock futures"), (3) bond indices (these are
referred to as "bond index futures"), (4) debt securities (these are referred to
as "interest rate futures"), (5) foreign currencies (these are referred to as
"forward contracts") and (6) commodity contracts (these are referred to as
commodity futures)." Except for High Income Fund/VA and Strategic Bond Fund/VA,
the Fixed Income Funds are not expected to buy or sell stock index futures or
single stock futures on a regular basis.

      A broadly-based stock index is used as the basis for trading stock index
futures. They may in some cases be based on stocks of issuers in a particular
industry or group of industries. A stock index assigns relative values to the
common stocks included in the index and its value fluctuates in response to the
changes in value of the underlying stocks. A stock index cannot be purchased or
sold directly. Bond index futures are similar contracts based on the future
value of the basket of securities that comprise the index. These contracts
obligate the seller to deliver, and the purchaser to take, cash to settle the
futures transaction. There is no delivery made of the underlying securities to
settle the futures obligation. Either party may also settle the transaction by
entering into an offsetting contract.

      An interest rate future obligates the seller to deliver (and the purchaser
to take) cash or a specified type of debt security to settle the futures
transaction. Either party could also enter into an offsetting contract to close
out the position. Similarly, a single stock future obligates the seller to
deliver (and the purchaser to take) cash or a specified equity security to
settle the futures transaction. Either party could also enter into an offsetting
contract to close out the position. Single stock futures trade on a very limited
number of exchanges, with contracts typically not fungible among the exchanges.
Similarly, a single stock future obligates the seller to deliver (and the
purchaser to take) cash or a specified equity security to settle the futures
transaction. Either party could also enter into an offsetting contract to close
out the position. Single stock futures trade on a very limited number of
exchanges, with contracts typically not fungible among the exchanges.

      No money is paid or received by the Funds on the purchase or sale of a
future. Upon entering into a futures transaction, the Funds will be required to
deposit an initial margin payment with the futures commission merchant (the
"futures broker"). Initial margin payments will be deposited with the Funds'
custodian bank in an account registered in the futures broker's name. However,
the futures broker can gain access to that account only under specified
conditions. As the future is marked to market (that is, its value on that Fund's
books is changed) to reflect changes in its market value, subsequent margin
payments, called variation margin, will be paid to or by the futures broker
daily.

      At any time prior to expiration of the future, the Funds may elect to
close out their position by taking an opposite position, at which time a final
determination of variation margin is made and any additional cash must be paid
by or released to that Fund. Any loss or gain on the future is then realized by
that Fund for tax purposes. All futures transactions are effected through a
clearinghouse associated with the exchange on which the contracts are traded.

o Put and Call Options. The Funds can buy and sell certain kinds of put options
("puts") and call options ("calls"). The Funds can buy and sell exchange-traded
and over-the-counter put and call options, including index options, securities
options, currency options, commodities options, and options on the other types
of futures described above.

o Writing Covered Call Options. The Funds can write (that is, sell) covered
calls. If a Fund sells a call option, it must be covered. That means the Fund
must own the security subject to the call while the call is outstanding, or, for
certain types of calls, the call may be covered by segregating liquid assets to
enable that Fund to satisfy its obligations if the call is exercised. Up to 100%
of a Fund's total assets may be subject to calls that Fund writes.

      When a Fund writes a call on a security, it receives cash (a premium).
That Fund agrees to sell the underlying security to a purchaser of a
corresponding call on the same security during the call period at a fixed
exercise price regardless of market price changes during the call period. The
call period is usually not more than nine months. The exercise price may differ
from the market price of the underlying security. That Fund shares the risk of
loss that the price of the underlying security may decline during the call
period. That risk may be offset to some extent by the premium the Fund receives.
If the value of the investment does not rise above the call price, it is likely
that the call will lapse without being exercised. In that case the Fund would
keep the cash premium and the investment.

      When a Fund writes a call on an index, it receives cash (a premium). If
the buyer of the call exercises it, the Fund will pay an amount of cash equal to
the difference between the closing price of the call and the exercise price,
multiplied by a specified multiple that determines the total value of the call
for each point of difference. If the value of the underlying investment does not
rise above the call price, it is likely that the call will lapse without being
exercised. In that case the Fund would keep the cash premium.

      The Funds' custodian bank, or a securities depository acting for the
custodian bank, will act as the Funds' escrow agent, through the facilities of
the Options Clearing Corporation ("OCC"), as to the investments on which the
Funds have written calls traded on exchanges or as to other acceptable escrow
securities. In that way, no margin will be required for such transactions. OCC
will release the securities on the expiration of the option or when the Funds
enter into a closing transaction.

      When a Fund writes an over-the-counter ("OTC") option, that Fund will
enter into an arrangement with a primary U.S. government securities dealer which
will establish a formula price at which the Fund will have the absolute right to
repurchase that OTC option. The formula price will generally be based on a
multiple of the premium received for the option, plus the amount by which the
option is exercisable below the market price of the underlying security (that
is, the option is "in the money"). When a Fund writes an OTC option, it will
treat as illiquid (for purposes of its restriction on holding illiquid
securities) the mark-to-market value of any OTC option it holds, unless the
option is subject to a buy-back agreement by the executing broker.

      To terminate its obligation on a call it has written, a Fund may purchase
a corresponding call in a "closing purchase transaction." A Fund will then
realize a profit or loss, depending upon whether the net of the amount of the
option transaction costs and the premium received on the call the Fund wrote is
more or less than the price of the call the Fund purchases to close out the
transaction. That Fund may realize a profit if the call expires unexercised,
because that Fund will retain the underlying security and the premium it
received when it wrote the call. Any such profits are considered short-term
capital gains for federal income tax purposes, as are the premiums on lapsed
calls. When distributed by a Fund they are taxable as ordinary income. If a Fund
cannot effect a closing purchase transaction due to the lack of a market, it
will have to hold the callable securities until the call expires or is
exercised.

      A Fund may also write calls on a futures contract without owning the
futures contract or securities deliverable under the contract. To do so, at the
time the call is written, that Fund must cover the call by identifying an
equivalent dollar amount of liquid assets on its books. The Fund will identify
additional liquid assets if the value of the identified assets drops below 100%
of the current value of the future. Because of this requirement, in no
circumstances would that Fund's receipt of an exercise notice as to that future
require that Fund to deliver a futures contract. It would simply put that Fund
in a short futures position, which is permitted by the Funds' hedging policies.

o Writing Put Options. Each Fund can sell put options. A put option on
securities gives the purchaser the right to sell, and the writer the obligation
to buy, the underlying investment at the exercise price during the option
period. The Funds will not write puts if, as a result, more than 50% of the
Fund's net assets would be required to be identified on its books to cover such
put options.

      If a Fund writes a put, the put must be covered by identifying liquid
assets on its books. The premium the Funds receive from writing a put represents
a profit, as long as the price of the underlying investment remains equal to or
above the exercise price of the put. However, that Fund also assumes the
obligation during the option period to buy the underlying investment from the
buyer of the put at the exercise price, even if the value of the investment
falls below the exercise price. If a put a Fund has written expires unexercised,
that Fund realizes a gain in the amount of the premium less the transaction
costs incurred. If the put is exercised, that Fund must fulfill its obligation
to purchase the underlying investment at the exercise price. That price will
usually exceed the market value of the investment at that time. In that case,
that Fund may incur a loss if it sells the underlying investment. That loss will
be equal to the sum of the sale price of the underlying investment and the
premium received minus the sum of the exercise price and any transaction costs
the Fund incurred.

      When writing a put option on a security, to secure its obligation to pay
for the underlying security, that Fund will identify on its books liquid assets
with a value equal to or greater than the exercise price of the underlying
securities. That Fund therefore forgoes the opportunity of investing the assets
identified on its books or writing calls against those assets.

      As long as a Fund's obligation as the put writer continues, it may be
assigned an exercise notice by the broker-dealer through which the put was sold.
That notice will require that Fund to take delivery of the underlying security
and pay the exercise price. No Fund has control over when it may be required to
purchase the underlying security, since it may be assigned an exercise notice at
any time prior to the termination of its obligation as the writer of the put.
That obligation terminates upon expiration of the put. It may also terminate if,
before it receives an exercise notice, that Fund effects a closing purchase
transaction by purchasing a put of the same series as it sold. Once a Fund has
been assigned an exercise notice, it cannot effect a closing purchase
transaction.

      A Fund may decide to effect a closing purchase transaction to realize a
profit on an outstanding put option it has written or to prevent the underlying
security from being put. Effecting a closing purchase transaction will also
permit that Fund to write another put option on the security, or to sell the
security and use the proceeds from the sale for other investments. A Fund will
realize a profit or loss from a closing purchase transaction depending on
whether the cost of the transaction is less or more than the premium received
from writing the put option. Any profits from writing puts are considered
short-term capital gains for federal tax purposes, and when distributed by a
Fund, is taxable as ordinary income.

o Purchasing Puts and Calls. Each Fund can purchase calls to protect against the
possibility that its portfolio will not participate in an anticipated rise in
the securities market. When a Fund buys a call (other than in a closing purchase
transaction), it pays a premium. That Fund then has the right to buy the
underlying investment from a seller of a corresponding call on the same
investment during the call period at a fixed exercise price. A Fund benefits
only if it sells the call at a profit or if, during the call period, the market
price of the underlying investment is above the sum of the call price plus the
transaction costs and the premium paid for the call and the Fund exercises the
call. If a Fund does not exercise the call or sell it (whether or not at a
profit), the call will become worthless at its expiration date. In that case the
Fund will have paid the premium but lost the right to purchase the underlying
investment.

      A Fund can buy puts whether or not it holds the underlying investment in
its portfolio. When a Fund purchases a put, it pays a premium and, except as to
puts on indices, has the right to sell the underlying investment to a seller of
a put on a corresponding investment during the put period at a fixed exercise
price. Buying a put on securities or futures a Fund owns enables that Fund to
attempt to protect itself during the put period against a decline in the value
of the underlying investment below the exercise price by selling the underlying
investment at the exercise price to a seller of a corresponding put. If the
market price of the underlying investment is equal to or above the exercise
price and, as a result, the put is not exercised or resold, the put will become
worthless at its expiration date. In that case the Fund will have paid the
premium but lost the right to sell the underlying investment. However, the Fund
may sell the put prior to its expiration. That sale may or may not be at a
profit.

      Buying a put on an investment a Fund does not own (such as an index of
future) permits a Fund to resell the put or to buy the underlying investment and
sell it at the exercise price. The resale price will vary inversely to the price
of the underlying investment. If the market price of the underlying investment
is above the exercise price and, as a result, the put is not exercised, the put
will become worthless on its expiration date.

      When a Fund purchases a call or put on an index or future, it pays a
premium, but settlement is in cash rather than by delivery of the underlying
investment to the Fund. A gain or loss depends on changes in the index in
question (and thus on price movements in the securities market generally) rather
than on price movements in individual securities or futures contracts.

      A Fund may buy a call or put only if, after the purchase, the value of all
call and put options held by the Fund will not exceed 5% of the Fund's total
assets.

o Buying and Selling Options on Foreign Currencies. A Fund can buy and sell
calls and puts on foreign currencies. They include puts and calls that trade on
a securities or commodities exchange or in the over-the-counter markets or are
quoted by major recognized dealers in such options. A Fund could use these calls
and puts to try to protect against declines in the dollar value of foreign
securities and increases in the dollar cost of foreign securities the Fund wants
to acquire.

      If the Manager anticipates a rise in the dollar value of a foreign
currency in which securities to be acquired are denominated, the increased cost
of those securities may be partially offset by purchasing calls or writing puts
on that foreign currency. If the Manager anticipates a decline in the dollar
value of a foreign currency, the decline in the dollar value of portfolio
securities denominated in that currency might be partially offset by writing
calls or purchasing puts on that foreign currency. However, the currency rates
could fluctuate in a direction adverse to a Fund's position. That Fund will then
have incurred option premium payments and transaction costs without a
corresponding benefit.

      A call the Fund writes on a foreign currency is "covered" if the Fund owns
the underlying foreign currency covered by the call or has an absolute and
immediate right to acquire that foreign currency without additional cash
consideration (or it can do so for additional cash consideration identified on
its books) upon conversion or exchange of other foreign currency held in its
portfolio.

      A Fund could write a call on a foreign currency to provide a hedge against
a decline in the U.S. dollar value of a security which the Fund owns or has the
right to acquire and which is denominated in the currency underlying the option.
That decline might be one that occurs due to an expected adverse change in the
exchange rate. This is known as a "cross-hedging" strategy. In those
circumstances, the Fund covers the option by identifying on its books liquid
assets in an amount equal to the exercise price of the option.

o Risks of Hedging with Options and Futures. The use of hedging instruments
requires special skills and knowledge of investment techniques that are
different than what is required for normal portfolio management. If the Manager
uses a hedging instrument at the wrong time or judges market conditions
incorrectly, hedging strategies may reduce a Fund's return. A Fund could also
experience losses if the prices of its futures and options positions were not
correlated with its other investments.

      A Fund's option activities could affect its portfolio turnover rate and
brokerage commissions. The exercise of calls written by the Fund might cause a
Fund to sell related portfolio securities, thus increasing its turnover rate.
The exercise by a Fund of puts on securities will cause the sale of underlying
investments, increasing portfolio turnover. Although the decision whether to
exercise a put it holds is within a Fund's control, holding a put might cause
that Fund to sell the related investments for reasons that would not exist in
the absence of the put.

      A Fund could pay a brokerage commission each time it buys or sells a call,
a put or an underlying investment in connection with the exercise of a call or
put. Those commissions could be higher on a relative basis than the commissions
for direct purchases or sales of the underlying investments. Premiums paid for
options are small in relation to the market value of the underlying investments.
Consequently, put and call options offer large amounts of leverage. The leverage
offered by trading in options could result in a Fund's net asset values being
more sensitive to changes in the value of the underlying investment.

      If a covered call written by a Fund is exercised on an investment that has
increased in value, that Fund will be required to sell the investment at the
call price. It will not be able to realize any profit if the investment has
increased in value above the call price.

      An option position may be closed out only on a market that provides
secondary trading for options of the same series, and there is no assurance that
a liquid secondary market will exist for any particular option. A Fund might
experience losses if it could not close out a position because of an illiquid
market for the future or option.

      There is a risk in using short hedging by selling futures or purchasing
puts on broadly-based indices or futures to attempt to protect against declines
in the value of a Fund's portfolio securities. The risk is that the prices of
the futures or the applicable index will correlate imperfectly with the behavior
of the cash prices of that Fund's securities. For example, it is possible that
while a Fund has used a hedging instrument in a short hedge, the market might
advance and the value of the securities held in the Fund's portfolio might
decline. If that occurred, the Fund would lose money on the hedging instrument
and also experience a decline in the value of its portfolio securities. However,
while this could occur for a very brief period or to a very small degree, over
time the value of a diversified portfolio of securities will tend to move in the
same direction as the indices upon which the hedging instrument is based.

      The risk of imperfect correlation increases as the composition of a Fund's
portfolio diverges from the securities included in the applicable index. To
compensate for the imperfect correlation of movements in the price of the
portfolio securities being hedged and movements in the price of the hedging
instruments, a Fund may use hedging instruments in a greater dollar amount than
the dollar amount of portfolio securities being hedged. It might do so if the
historical volatility of the prices of the portfolio securities being hedged are
more than the historical volatility of the applicable index.

      The ordinary spreads between prices in the cash and futures markets are
subject to distortions, due to differences in the nature of those markets.
First, all participants in the futures market are subject to margin deposit and
maintenance requirements. Rather than meeting additional margin deposit
requirements, investors may close futures contracts through offsetting
transactions which could distort the normal relationship between the cash and
futures markets. Second, the liquidity of the futures market depends on
participants entering into offsetting transactions rather than making or taking
delivery. To the extent participants decide to make or take delivery, liquidity
in the futures market could be reduced, thus producing distortion. Third, from
the point of view of speculators, the deposit requirements in the futures market
are less onerous than margin requirements in the securities markets. Therefore,
increased participation by speculators in the futures market may cause temporary
price distortions.

      A Fund can use hedging instruments to establish a position in the
securities markets as a temporary substitute for the purchase of individual
securities (long hedging) by buying futures and/or calls on such futures,
broadly-based indices or on securities. It is possible that when a Fund does so
the market might decline. If that Fund then concludes not to invest in
securities because of concerns that the market might decline further or for
other reasons, the Fund will realize a loss on the hedging instruments that is
not offset by a reduction in the price of the securities purchased.

o Forward Contracts. Forward contracts are foreign currency exchange contracts.
They are used to buy or sell foreign currency for future delivery at a fixed
price. A Fund uses them to "lock in" the U.S. dollar price of a security
denominated in a foreign currency that the Fund has bought or sold, or to
protect against possible losses from changes in the relative values of the U.S.
dollar and a foreign currency. A Fund limits its exposure in foreign currency
exchange contracts in a particular foreign currency to the amount of its assets
denominated in that currency or a closely-correlated currency. A Fund may also
use "cross-hedging" where it hedges against changes in currencies other than the
currency in which a security it holds is denominated.

      Under a forward contract, one party agrees to purchase, and another party
agrees to sell, a specific currency at a future date. That date may be any fixed
number of days from the date of the contract agreed upon by the parties. The
transaction price is set at the time the contract is entered into. These
contracts are traded in the inter-bank market conducted directly among currency
traders (usually large commercial banks) and their customers.

      The Funds may use forward contracts to protect against uncertainty in the
level of future exchange rates. The use of forward contracts does not eliminate
the risk of fluctuations in the prices of the underlying securities a Fund owns
or intends to acquire, but it does fix a rate of exchange in advance. Although
forward contracts may reduce the risk of loss from a decline in the value of the
hedged currency, at the same time they limit any potential gain if the value of
the hedged currency increases.

      When a Fund enters into a contract for the purchase or sale of a security
denominated in a foreign currency, or when it anticipates receiving dividend
payments in a foreign currency, the Fund might desire to "lock-in" the U.S.
dollar price of the security or the U.S. dollar equivalent of the dividend
payments. To do so, that Fund could enter into a forward contract for the
purchase or sale of the amount of foreign currency involved in the underlying
transaction, in a fixed amount of U.S. dollars per unit of the foreign currency.
This is called a "transaction hedge." The transaction hedge will protect the
Fund against a loss from an adverse change in the currency exchange rates during
the period between the date on which the security is purchased or sold or on
which the payment is declared, and the date on which the payments are made or
received.

      A Fund could also use forward contracts to lock in the U.S. dollar value
of a portfolio position. This is called a "position hedge." When a Fund believes
that foreign currency might suffer a substantial decline against the U.S.
dollar, it could enter into a forward contract to sell an amount of that foreign
currency approximating the value of some or all of the Fund's portfolio
securities denominated in that foreign currency. When a Fund believes that the
U.S. dollar might suffer a substantial decline against a foreign currency, it
could enter into a forward contract to buy that foreign currency for a fixed
dollar amount. Alternatively, a Fund could enter into a forward contract to sell
a different foreign currency for a fixed U.S. dollar amount if the Fund believes
that the U.S. dollar value of the foreign currency to be sold pursuant to its
forward contract will fall whenever there is a decline in the U.S. dollar value
of the currency in which portfolio securities of the Fund are denominated. That
is referred to as a "cross hedge".

      The Fund will cover its short positions in these cases by identifying on
its books liquid assets having a value equal to the aggregate amount of the
Fund's commitment under forward contracts. No Fund will enter into forward
contracts or maintain a net exposure to such contracts if the consummation of
the contracts would obligate a Fund to deliver an amount of foreign currency in
excess of the value of that Fund's portfolio securities or other assets
denominated in that currency or another currency that is the subject of the
hedge.

      The precise matching of the amounts under forward contracts and the value
of the securities involved generally will not be possible because the future
value of securities denominated in foreign currencies will change as a
consequence of market movements between the date the forward contract is entered
into and the date it is sold. In some cases the Manager might decide to sell the
security and deliver foreign currency to settle the original purchase
obligation. If the market value of the security is less than the amount of
foreign currency the Fund is obligated to deliver, the Fund might have to
purchase additional foreign currency on the "spot" (that is, cash) market to
settle the security trade. If the market value of the security instead exceeds
the amount of foreign currency the Fund is obligated to deliver to settle the
trade, the Fund might have to sell on the spot market some of the foreign
currency received upon the sale of the security. There will be additional
transaction costs on the spot market in those cases.

      The projection of short-term currency market movements is extremely
difficult, and the successful execution of a short-term hedging strategy is
highly uncertain. Forward contracts involve the risk that anticipated currency
movements will not be accurately predicted, causing a Fund to sustain losses on
these contracts and to pay additional transactions costs. The use of forward
contracts in this manner might reduce a Fund's performance if there are
unanticipated changes in currency prices to a greater degree than if a Fund had
not entered into such contracts.

      At or before the maturity of a forward contract requiring a Fund to sell a
currency, the Fund might sell a portfolio security and use the sale proceeds to
make delivery of the currency. In the alternative a Fund might retain the
security and offset its contractual obligation to deliver the currency by
purchasing a second contract. Under that contract a Fund will obtain, on the
same maturity date, the same amount of the currency that it is obligated to
deliver. Similarly, a Fund might close out a forward contract requiring it to
purchase a specified currency by entering into a second contract entitling it to
sell the same amount of the same currency on the maturity date of the first
contract. The Fund would realize a gain or loss as a result of entering into
such an offsetting forward contract under either circumstance. The gain or loss
will depend on the extent to which the exchange rate or rates between the
currencies involved moved between the execution dates of the first contract and
offsetting contract.

      The costs to a Fund of engaging in forward contracts varies with factors
such as the currencies involved, the length of the contract period and the
market conditions then prevailing. Because forward contracts are usually entered
into on a principal basis, no brokerage fees or commissions are involved.
Because these contracts are not traded on an exchange, a Fund must evaluate the
credit and performance risk of the counterparty under each forward contract.

      Although a Fund values its assets daily in terms of U.S. dollars, it does
not intend to convert its holdings of foreign currencies into U.S. dollars on a
daily basis. Funds may convert foreign currency from time to time, and will
incur costs in doing so. Foreign exchange dealers do not charge a fee for
conversion, but they do seek to realize a profit based on the difference between
the prices at which they buy and sell various currencies. Thus, a dealer might
offer to sell a foreign currency to a Fund at one rate, while offering a lesser
rate of exchange if the Fund desires to resell that currency to the dealer.

|X| Interest Rate Swaps Transactions. Core Bond Fund/VA, High Income Fund/VA,
Strategic Bond/VA and Value Fund/VA can enter into interest rate swap
agreements. In an interest rate swap, the Fund and another party exchange their
right to receive or their obligation to pay interest on securities. For example,
they might swap the right to receive floating rate payments for fixed rate
payments. Each of these Funds can enter into interest rate swaps on securities
it owns or as hedge against a basket of securities held by that Fund that the
Fund's Manager deems to be closely correlated with the swap transactions. Also,
that Fund will identify on its books liquid assets (such as cash or U.S.
government securities) to cover any amounts it could owe under swaps that exceed
the amounts it is entitled to receive, and it will adjust that amount daily, as
needed.

      Swap agreements entail both interest rate risk and credit risk. There is a
risk that, based on movements of interest rates in the future, the payments made
by the Fund under a swap agreement will be greater than the payments it
received. Credit risk arises from the possibility that the counterparty will
default. If the counterparty defaults, the Fund's loss will consist of the net
amount of contractual interest payments that the Fund has not yet received. The
Manager will monitor the creditworthiness of counterparties to the Fund's
interest rate swap transactions on an ongoing basis.

      The Fund can enter into swap transactions with certain counterparties
pursuant to master netting agreements. A master netting agreement provides that
all swaps done between the Fund and that counterparty shall be regarded as parts
of an integral agreement. If amounts are payable on a particular date in the
same currency in respect of one or more swap transactions, the amount payable on
that date in that currency shall be the net amount. In addition, the master
netting agreement may provide that if one party defaults generally or on one
swap, the counterparty can terminate all of the swaps with that party. Under
these agreements, if a default results in a loss to one party, the measure of
that party's damages is calculated by reference to the average cost of a
replacement swap for each swap. It is measured by the mark-to-market value at
the time of the termination of each swap. The gains and losses on all swaps are
then netted, and the result is the counterparty's gain or loss on termination.
The termination of all swaps and the netting of gains and losses on termination
is generally referred to as "aggregation".

o Swaption Transactions. The Fixed Income Funds may enter into a swaption
transaction, which is a contract that grants the holder, in return for payment
of the purchase price (the "premium") of the option, the right, but not the
obligation, to enter into an interest rate swap at a preset rate within a
specified period of time, with the writer of the contract. The writer of the
contract receives the premium and bears the risk of unfavorable changes in the
preset rate on the underlying interest rate swap. Unrealized gains/losses on
swaptions are reflected in investment assets and investment liabilities in the
Fund's statement of financial condition.

|X| Credit Derivatives. The Fixed Income Funds and Balanced/VA may enter into
credit default swaps, both directly ("unfunded swaps") and indirectly in the
form of a swap embedded within a structured note ("funded swaps"), to protect
against the risk that a security will default. Unfunded and funded credit
default swaps may be on a single security, or on a basket of securities. These
Funds pay a fee to enter into the swap and receives a fixed payment during the
life of the swap. These Funds may take a short position in the credit default
swap (also known as "buying credit protection"), or may take a long position in
the credit default swap note (also known as "selling credit protection").

      These Funds would take a short position in a credit default swap (the
"unfunded swap") against a long portfolio position to decrease exposure to
specific high yield issuers. If the short credit default swap is against a
corporate issue, these Funds must own that corporate issue. However, if the
short credit default swap is against sovereign debt, these Funds may own either:
(i) the reference obligation, (ii) any sovereign debt of that foreign country,
or (iii) sovereign debt of any country that the Manager determines is closely
correlated as an inexact bona fide hedge.

      If these Funds take a short position in the credit default swap, if there
is a credit event (including bankruptcy, failure to timely pay interest or
principal, or a restructuring), these Funds will deliver the defaulted bonds and
the swap counterparty will pay the par amount of the bonds. An associated risk
is adverse pricing when purchasing bonds to satisfy the delivery obligation. If
the swap is on a basket of securities, the notional amount of the swap is
reduced by the par amount of the defaulted bond, and the fixed payments are then
made on the reduced notional amount.

      Taking a long position in the credit default swap note (i.e., purchasing
the "funded swap") would increase a Fund's exposure to specific high yield
corporate issuers. The goal would be to increase liquidity in that market sector
via the swap note and its associated increase in the number of trading
instruments, the number and type of market participants, and market
capitalization.

      If a Fund takes a long position in the credit default swap note, if there
is a credit event the Fund will pay the par amount of the bonds and the swap
counterparty will deliver the bonds. If the swap is on a basket of securities,
the notional amount of the swap is reduced by the par amount of the defaulted
bond, and the fixed payments are then made on the reduced notional amount.

      These Funds will invest no more than 25% of their total assets in
"unfunded" credit default swaps. These Funds will limit their investments in
"funded" credit default swap notes to no more than 10% of its total assets.

      Other risks of credit default swaps include the cost of paying for credit
protection if there are no credit events, pricing transparency when assessing
the cost of a credit default swap, counterparty risk, and the need to fund the
delivery obligation (either cash or the defaulted bonds, depending on whether
the Fund is long or short the swap, respectively).

o Regulatory Aspects of Hedging Instruments. When using futures and options on
futures, the Funds are required to operate within certain guidelines and
restrictions with respect to the use of futures as established by the
Commodities Futures Trading Commission (the "CFTC"). In particular, a Fund is
exempted from registration with the CFTC as a "commodity pool operator" if the
Fund complies with the requirements of Rule 4.5 adopted by the CFTC. The Rule
does not limit the percentage of a Fund's assets that may be used for futures
margin and related options premiums for a bona fide hedging position. However,
under the Rule, a Fund must limit its aggregate initial futures margin and
related options premiums to not more than 5% of the Funds' net assets for
hedging strategies that are not considered bona fide hedging strategies under
the Rule.

      Transactions in options by a Fund are subject to limitations established
by the option exchanges. The exchanges limit the maximum number of options that
may be written or held by a single investor or group of investors acting in
concert. Those limits apply regardless of whether the options were written or
purchased on the same or different exchanges or are held in one or more accounts
or through one or more different exchanges or through one or more brokers. Thus,
the number of options that a Fund may write or hold may be affected by options
written or held by other entities, including other investment companies having
the same advisor as that Fund (or an advisor that is an affiliate of the Funds'
advisor). The exchanges also impose position limits on futures transactions. An
exchange may order the liquidation of positions found to be in violation of
those limits and may impose certain other sanctions.

      Under the Investment Company Act, when a Fund purchases a future, it must
identify as segregated on its records liquid assets in an amount equal to the
market value of the securities underlying the future, less the margin deposit
applicable to it.

o Tax Aspects of Certain Hedging Instruments. Certain foreign currency exchange
contracts are treated as "Section 1256 contracts" under the Internal Revenue
Code. In general, gains or losses relating to Section 1256 contracts are
characterized as 60% long-term and 40% short-term capital gains or losses under
the Code. However, foreign currency gains or losses arising from Section 1256
contracts that are forward contracts generally are treated as ordinary income or
loss. In addition, Section 1256 contracts held by the Funds at the end of each
taxable year are "marked-to-market," and unrealized gains or losses are treated
as though they were realized. These contracts also may be marked-to-market for
other purposes under rules prescribed pursuant to the Internal Revenue Code. An
election can be made by a Fund to exempt those transactions from this
marked-to-market treatment.

      Certain forward contracts a Fund enters into may result in "straddles" for
federal income tax purposes. The straddle rules may affect the character and
timing of gains (or losses) recognized by that Fund on straddle positions.
Generally, a loss sustained on the disposition of a position making up a
straddle is allowed only to the extent that the loss exceeds any unrecognized
gain in the offsetting positions making up the straddle. Disallowed loss is
generally allowed at the point where there is no unrecognized gain in the
offsetting positions making up the straddle, or the offsetting position is
disposed of.

      Under the Internal Revenue Code, the following gains or losses are treated
as ordinary income or loss: (1) gains or losses attributable to fluctuations in
exchange rates that
         occur between the time a Fund accrues interest or other receivables or
         accrues expenses or other liabilities denominated in a foreign currency
         and the time that Fund actually collects such receivables or pays such
         liabilities, and
(2)      gains or losses attributable to fluctuations in the value of a foreign
         currency between the date of acquisition of a debt security denominated
         in a foreign currency or foreign currency forward contracts and the
         date of disposition.

      Currency gains and losses are offset against market gains and losses on
each trade before determining a net "Section 988" gain or loss under the
Internal Revenue Code for that trade, which may increase or decrease the amount
of a Fund's investment income available for distribution to its shareholders.

      |X| Temporary Defensive and Interim Investments. When market conditions
are unstable, or the Manager believes it is otherwise appropriate to reduce
holdings in stocks or bonds, the Funds can invest in a variety of debt
securities for defensive purposes. The Funds can also purchase these securities
for liquidity purposes to meet cash needs due to the redemption of Fund shares,
or to hold while waiting to reinvest cash received from the sale of other
portfolio securities. The Funds can buy:
o     obligations issued or guaranteed by the U.S. government or its
            instrumentalities or agencies,
o           commercial paper (short-term, unsecured, promissory notes of
            domestic or foreign companies) rated in the three top rating
            categories of a nationally recognized rating organization,
o           short-term debt obligations of corporate issuers, rated investment
            grade (rated at least Baa by Moody's or at least BBB by Standard &
            Poor's or a comparable rating by another rating organization), or
            unrated securities judged by the Manager to have a comparable
            quality to rated securities in those categories,
o           certificates of deposit and bankers' acceptances of domestic and
            foreign banks having total assets in excess of $1 billion, and
o     repurchase agreements.

      Short-term debt securities would normally be selected for defensive or
cash management purposes because they can normally be disposed of quickly, are
not generally subject to significant fluctuations in principal value and their
value will be less subject to interest rate risk than longer-term debt
securities.

|X| Investment in Other Investment Companies. The Funds (except Money Fund/VA)
can also invest in the securities of other investment companies, which can
include open-end funds, closed-end funds and unit investment trusts, subject to
the limits set forth in the Investment Company Act that apply to those types of
investments. For example, a Fund can invest in Exchange-Traded Funds, which are
typically open-end funds or unit investment trusts, listed on a stock exchange.
A Fund might do so as a way of gaining exposure to the segments of the equity or
fixed-income markets represented by the Exchange-Traded Funds' portfolio, at
times when a Fund may not be able to buy those portfolio securities directly.

      Investing in another investment company may involve the payment of
substantial premiums above the value of such investment company's portfolio
securities and is subject to limitations under the Investment Company Act. The
Funds do not intend to invest in other investment companies unless the Manager
believes that the potential benefits of the investment justify the payment of
any premiums or sales charges. As a shareholder of an investment company, a Fund
would be subject to its ratable share of that investment company's expenses,
including its advisory and administration expenses. The Funds do not anticipate
investing a substantial amount of its net assets in shares of other investment
companies.

Money Fund/VA Investment Policies. Under Rule 2a-7 under the investment Company
Act, Money Fund/VA may purchase only "Eligible Securities," as defined below,
that the Manger, under procedures approved by the Trust's Board of Trustees, has
determined have minimal credit risk. An "Eligible Security" is (a) a security
that has received a rating in one of the two highest short-term rating
categories by any two "nationally-recognized statistical rating organizations"
as defined in Rule 2a-7 ("Rating Organizations"), or, if only one Rating
Organization has rated that security, by that Rating Organization (the "Rating
Requirements"), (b) a security that is guaranteed, and either that guarantee or
the party providing that guarantee meets the Rating Requirements, or (c) an
unrated security that is either issued by an issuer having another similar
security that meets the Rating Requirements, or is judged by the Manager to be
of comparable quality to investments that meet the Rating Requirements. Rule
2a-7 permits Money Fund/VA to purchase "First Tier Securities," which are
Eligible Securities rated in the highest category for short-term debt
obligations by at least two Rating Organizations, or, if only one Rating
Organization has rated a particular security, by that Rating Organization, or
comparable unrated securities. The Fund can also buy "Second Tier Securities,"
which are Eligible Securities that are not First Tier securities.

      If a security's rating is downgraded, the Manager and/or the Board may
have to reassess the security's credit risk. If a security has ceased to be a
First Tier Security, the Manager will promptly reassess whether the security
continues to present "minimal credit risk." If the Manager becomes aware that
any Rating Organization has downgraded its rating of a Second Tier Security or
rated an unrated security below its second highest rating category, the Trust's
Board of Trustees shall promptly reassess whether the security presents minimal
credit risk and whether it is in Money Fund/VA's best interests to dispose of
it.

      If Money Fund/VA disposes of the security within five days of the Manager
learning of the downgrade, the Manager will provide the Board with subsequent
notice of such downgrade. If a security is in default, or ceases to be an
Eligible Security, or is determined no longer to present minimal credit risks,
the Board must determine if disposal of the security would be in Money Fund/VA's
best interests.

      The Rating Organizations currently designated as nationally-recognized
statistical rating organizations by the SEC are Standard & Poor's (a division of
the McGraw-Hill Companies), Moody's Investors Service, Inc., Fitch, Inc. and
Dominion Bond Rating Service Limited. See Appendix A to this Statement of
Additional Information for a description of the rating categories of the Rating
Organizations.

o     Certificates of Deposit and Commercial Paper. Money Fund/VA may invest
         in certificates of deposit of up to $100,000 of a domestic bank if
         such certificates of deposit are fully insured as to principal by
         the Federal Deposit Insurance Corporation. For purposes of this
         section, the term "bank" includes commercial banks, savings banks,
         and savings and loan associations and the term "foreign bank"
         includes foreign branches of U.S. banks (issuers of "Eurodollar"
         instruments), U.S. branches and agencies of foreign banks (issuers
         of "Yankee dollar" instruments) and foreign branches of foreign
         banks. Money Fund/VA also may purchase obligations issued by other
         entities if they are: (i) guaranteed as to principal and interest by
         a bank or corporation whose certificates of deposit or commercial
         paper may otherwise be purchased by Money Fund/VA, or (ii) subject
         to repurchase agreements (explained in the prospectus), if the
         collateral for the agreement complies with Rule 2a-7.

o     Bank Loan Participation Agreements. Money Fund/VA may invest in bank
         loan participation agreements, although such investments have not
         been a principal investment strategy. They provide the Fund with an
         undivided interest in a loan made by the issuing bank in the
         proportion the Fund's interest bears to the total principal amount
         of the loan. In evaluating the risk of these investments, the Fund
         looks to the creditworthiness of the borrower that is obligated to
         make principal and interest payments on the loan.

o        Time Deposits. Money Fund/VA may invest in fixed time deposits, which
         are non-negotiable deposits in a bank for a specified period of time at
         a stated interest rate, whether or not subject to withdrawal penalties;
         however, such deposits which are subject to such penalties, other than
         deposits maturing in less than seven days, are subject to the 10%
         limitation applicable to illiquid securities purchased by Money
         Fund/VA.

o     Floating Rate/Variable Rate Notes. Money Fund/VA may invest in
         instruments with floating or variable interest rates. The interest
         rate on a floating rate obligation is based on a stated prevailing
         market rate, such as a bank's prime rate, the 90-day U.S. Treasury
         Bill rate, the rate of return on commercial paper or bank
         certificates of deposit, or some other standard, and is adjusted
         automatically each time such market rate is adjusted. The interest
         rate on a variable rate obligation is also based on a stated
         prevailing market rate but is adjusted automatically at a specified
         interval of no less than one year. Some variable rate or floating
         rate obligations in which Money Fund/VA may invest have a demand
         feature entitling the holder to demand payment at an amount
         approximately equal to the principal amount thereof plus accrued
         interest at any time, or at specified intervals not exceeding one
         year. These notes may or may not be backed by bank letters of
         credit. The interest rates on these notes fluctuate from time to
         time. Generally, the changes in the interest rate on such securities
         reduce the fluctuation in their market value. As interest rates
         decrease or increase, the potential for capital appreciation or
         depreciation is less than that for fixed-rate obligations of the
         same maturity.

o     Master Demand Notes. Master demand notes are corporate obligations that
         permit the investment of fluctuating amounts by Money Fund/VA at
         varying rates of interest pursuant to direct arrangements between
         Money Fund/VA, as lender, and the corporate borrower that issues the
         note. These notes permit daily changes in the amounts borrowed.
         Money Fund/VA has the right to increase the amount under the note at
         any time up to the full amount provided by the note agreement, or to
         decrease the amount. The borrower may repay up to the full amount of
         the note at any time without penalty. It is not generally
         contemplated that master demand notes will be traded because they
         are direct lending arrangements between the lender and the borrower.
         There is no secondary market for these notes, although they are
         redeemable and thus immediately repayable by the borrower at face
         value, plus accrued interest, at any time. Accordingly, where these
         obligations are not secured by letters of credit or other credit
         support arrangements, Money Fund/VA's right to redeem is dependent
         upon the ability of the borrower to pay principal and interest on
         demand. In evaluating the master demand arrangements, the Manager
         considers the earning power, cash flow, and other liquidity ratios
         of the issuer. If they are not rated by Rating Organizations, Money
         Fund/VA may invest in them only if, at the time of an investment,
         they are Eligible Securities. The Manager will continuously monitor
         the borrower's financial ability to meet all of its obligations
         because Money Fund/VA's liquidity might be impaired if the borrower
         were unable to pay principal and interest on demand. There is no
         limit on the amount of the Money Fund/VA's assets that may be
         invested in floating rate and variable rate obligations. Floating
         rate or variable rate obligations which do not provide for recovery
         of principal and interest within seven days' notice will be subject
         to the 10% limitation applicable to illiquid securities purchased by
         Money Fund/VA.

Other Investment Restrictions. In addition to having a number of investment
policies and restrictions identified in the Prospectuses or elsewhere as
"fundamental policies," the Funds have other investment restrictions that are
fundamental policies, described below.

      |X| What Are "Fundamental Policies?" Fundamental policies are those
policies that the Fund has adopted to govern its investments that can be changed
only by the vote of a "majority" of the Fund's outstanding voting securities.
Under the Investment Company Act, a "majority" vote is defined as the vote of
the holders of the lesser of:
o           67% or more of the shares present or represented by proxy at a
            shareholder meeting, if the holders of more than 50% of the
            outstanding shares are present or represented by proxy, or
o     more than 50% of the outstanding shares.

      The Funds' (except Value Fund /VA) investment objectives are fundamental
policies. Other policies described in the Prospectuses or this Statement of
Additional Information are "fundamental" only if they are identified as such.
The Funds' Board of Trustees can change non-fundamental policies without
shareholder approval. However, significant changes to investment policies will
be described in supplements or updates to the Prospectuses or this Statement of
Additional Information, as appropriate. The Funds' most significant investment
policies are described in the Prospectus.

      |X| Do the Funds Have Additional Fundamental Policies? The following
investment restrictions are fundamental policies of the Funds.

o     No Fund can buy securities issued or guaranteed by any one issuer if
         (i) more than 5% of its total assets would be invested in securities
         of that issuer or (ii) it would then own more than 10% of that
         issuer's voting securities, or (iii) it would then own more than 10%
         in principal amount of that issuer's outstanding debt securities.
         The restriction on debt securities does not apply to Strategic Bond
         Fund/VA. All of the restrictions apply only to 75% of each Fund's
         total assets. The limits do not apply to securities issued by the
         U.S. government or any of its agencies or instrumentalities, or
         securities of other investment companies.

o        The Funds cannot make loans except (a) through lending of securities,
         (b) through the purchase of debt instruments or similar evidences of
         indebtedness, (c) through an interfund lending program with other
         affiliated funds, and (d) through repurchase agreements.

o        The Funds cannot concentrate investments. That means they cannot invest
         25% or more of their total assets in companies in any one industry.
         Obligations of the U.S. government, its agencies and instrumentalities
         are not considered to be part of an "industry" for the purposes of this
         restriction. This policy does not limit investments by Money Fund/VA in
         obligations issued by banks.

o        The Funds cannot buy or sell real estate or interests in real estate.
         However, the Funds can purchase debt securities secured by real estate
         or interests in real estate, or issued by companies, including real
         estate investment trusts, which invest in real estate or interests in
         real estate.

o        The Funds cannot underwrite securities of other companies. A permitted
         exception is in case a Fund is deemed to be an underwriter under the
         Securities Act when reselling any securities held in its own portfolio.

o        The Funds cannot invest in commodities or commodity contracts, other
         than the hedging instruments permitted by any of its other fundamental
         policies. It does not matter whether the hedging instrument is
         considered to be a commodity or commodity contract.

o     The Funds cannot issue "senior securities," but this does not prohibit
         certain investment activities for which assets of the Funds are
         designated as segregated, or margin, collateral or escrow
         arrangements are established, to cover the related obligations.
         Examples of those activities include borrowing money, reverse
         repurchase agreements, delayed-delivery and when-issued arrangements
         for portfolio securities transactions, and contracts to buy or sell
         derivatives, hedging instruments, options or futures.

o        The Funds cannot borrow money in excess of 33-1/3% of the value of that
         Fund's total assets. The Funds may borrow only from bank. With respect
         to this fundamental policy, the Funds can borrow only if they maintain
         a 300% ratio of assets to borrowings at all times in the manner set
         forth in the Investment Company Act.

      The following investment restrictions are fundamental policies of the
Value Fund/VA.

o     Value Fund/VA cannot issue senior securities. However, it can make
         payments or deposits of margin in connection with options or futures
         transactions, lend its portfolio securities, enter into repurchase
         agreements, borrow money and pledge its assets as permitted by its
         other fundamental policies. For purposes of this restriction, the
         issuance of shares of common stock in multiple classes or series,
         the purchase or sale of options, futures contracts and options on
         futures contracts, forward commitments, and repurchase agreements
         entered into in accordance with the Fund's investment policies, and
         the pledge, mortgage or hypothecation of the Fund's assets are not
         deemed to be senior securities.

o     Value Fund/VA cannot buy securities or other instruments issued or
         guaranteed by any one issuer if more than 5% of its total assets
         would be invested in securities or other instruments of that issuer
         or if it would then own more than 10% of that issuer's voting
         securities. This limitation applies to 75% of the Fund's total
         assets. The limit does not apply to securities issued or guaranteed
         by the U.S. government or any of its agencies or instrumentalities
         or securities of other investment companies.

o        Value Fund/VA cannot invest 25% or more of its total assets in any one
         industry. That limit does not apply to securities issued or guaranteed
         by the U.S. government or its agencies and instrumentalities or
         securities issued by investment companies.

o        Value Fund/VA cannot invest in physical commodities or commodities
         contracts. However, the Fund can invest in hedging instruments
         permitted by any of its other investment policies, and can buy or sell
         options, futures, securities or other instruments backed by, or the
         investment return from which is linked to, changes in the price of
         physical commodities, commodity contracts or currencies.

o        Value Fund/VA cannot invest in real estate or in interests in real
         estate. However, the Fund can purchase securities of issuers holding
         real estate or interests in real estate (including securities of real
         estate investment trusts) if permitted by its other investment
         policies.

o        Value Fund/VA cannot underwrite securities of other issuers. A
         permitted exception is in case it is deemed to be an underwriter under
         the Securities Act in reselling its portfolio securities.

o        Value Fund/VA cannot make loans, except to the extent permitted under
         the Investment Company Act, the rules or regulations thereunder or any
         exemption therefrom that is applicable to the Fund, as such statute,
         rules or regulations may be amended or interpreted from time to time.

o        Value Fund/VA may not borrow money, except to the extent permitted
         under the Investment Company Act, the rules or regulations thereunder
         or any exemption therefrom that is applicable to the Fund, as such
         statute, rules or regulations may be amended or interpreted from time
         to time.

      Value Fund/VA has also adopted the following non-fundamental policy: The
Fund cannot invest in securities of other investment companies, except to the
extent permitted under the Investment Company Act, the rules or regulations
thereunder or any exemption therefrom, as such statute, rules or regulations may
be amended or interpreted from time to time.

      Main Street Small Cap Fund(R)/VA has also adopted the following
non-fundamental policy: With respect to the Fund's non-fundamental policy to
invest, under normal circumstances, at least 80% of its net assets (plus the
amount of any borrowings used for investment purposes) in equity securities of
"small-cap" issuers, the Fund will provide shareholders at least 60 days' prior
notice of any change in such policy as required by the Investment Company Act.

      Unless the Prospectus or this Statement of Additional Information states
that a percentage restriction applies on an ongoing basis, it applies only at
the time the Funds makes an investment (except in the case of borrowing and
investments in illiquid securities). The Funds need not sell securities to meet
the percentage limits if the value of the investment increases in proportion to
the size of the Fund.

      For purposes of the Funds' policy not to concentrate its investments as
described above, Money Fund/VA and all other Funds have adopted the industry
classifications set forth in Appendix B and Appendix C, respectively, to this
Statement of Additional Information. This is not a fundamental policy.

Disclosure of Portfolio Holdings. The Funds have adopted policies and procedures
concerning the dissemination of information about the portfolio securities
holdings of the Funds by employees, officers and/or directors of the Manager,
Distributor, and Transfer Agent. These policies are designed to assure that
non-public information about portfolio securities is distributed only for a
legitimate business purpose, and is done in a manner that (a) conforms to
applicable laws and regulations and (b) is designed to prevent that information
from being used in a way that could negatively affect the Funds' investment
program or enable third parties to use that information in a manner that is
harmful to the Fund.

o Public Disclosure. Each of the Fund's portfolio holdings are made publicly
available no later than 60 days after the close of each Fund's fiscal quarters
in semi-annual and annual reports to shareholders, or in their Statements of
Investments on Form N-Q, which are publicly available at the SEC. In addition,
the top 10 or more holdings shall be posted on the OppenheimerFunds' website at
www.oppenheimerfunds.com in the "Fund Profiles" section. Other general
information about the Fund's portfolio investments, such as portfolio
composition by asset class, industry, country, currency, credit rating or
maturity, may also be posted with a 15-day lag.

      Until publicly disclosed, the Fund's portfolio holdings are proprietary,
confidential business information. While recognizing the importance of providing
Fund shareholders with information about their Fund's investments and providing
portfolio information to a variety of third parties to assist with the
management, distribution and administrative process, such need for transparency
must be balanced against the risk that third parties who gain access to a Fund's
portfolio holdings information could attempt to use that information to trade
ahead of or against the Funds, which could negatively affect the prices the
Funds are able to obtain in portfolio transactions or the availability of the
portfolio securities that portfolio managers are trading in on a Fund's behalf.

      The Manager and its subsidiaries and affiliates, employees, officers, and
directors, shall neither solicit nor accept any compensation or other
consideration (including any agreement to maintain assets in the Funds or in
other investment companies or accounts managed by the Manager or any affiliated
person of the Manager) in connection with the disclosure of the Fund's
non-public portfolio holdings. The receipt of investment advisory fees or other
fees and compensation paid to the Manager and their subsidiaries pursuant to
agreements approved by the Funds' Board shall not be deemed to be "compensation"
or "consideration" for these purposes. It is a violation of the Code of Ethics
for any covered person to release holdings in contravention of portfolio
holdings disclosure policies and procedures adopted by the Funds.

      A list of the top 10 or more portfolio securities holdings (based on
invested assets), listed by security or by issuer, as of the end of each month
may be disclosed to third parties (subject to the procedures below) no sooner
than 15 days after month-end.

      Except under special limited circumstances discussed below, month-end
lists of the Fund's complete portfolio holdings may be disclosed no sooner than
30 days after the relevant month-end, subject to the procedures below. If the
Funds' complete portfolio holdings have not been disclosed publicly, they may be
disclosed pursuant to special requests for legitimate business reasons, provided
that:

o        The third-party recipient must first submit a request for release of
         Fund portfolio holdings, explaining the business reason for the
         request;
o        Senior officers (a Senior Vice President or above) in the Manager's
         Portfolio and Legal departments must approve the completed request for
         release of Fund portfolio holdings; and
o        The third-party recipient must sign the Manager's portfolio holdings
         non-disclosure agreement before receiving the data, agreeing to keep
         information that is not publicly available regarding the Fund's
         holdings confidential and agreeing not to trade directly or indirectly
         based on the information.

      An exception may be made to provide portfolio holdings information on a
more current basis to insurance company sponsors that have signed a
Participation Agreement with, and offer series of, Oppenheimer Variable Account
Funds or Panorama Series Fund, Inc. to their separate account contract holders,
if such insurance companies require such portfolio holdings information for the
preparation of reports to their contract holders, and have contractually
undertaken to keep such information confidential. Additionally, such information
may be made available to new insurance company sponsors that first sign a
confidentiality agreement in connection with evaluating offering such funds
under their separate accounts.

      The Funds' complete portfolio holdings positions may be released to the
following categories of entities or individuals on an ongoing basis, provided
that such entity or individual either (1) has signed an agreement to keep such
information confidential and not trade on the basis of such information or (2)
is subject to fiduciary obligations, as a member of the Funds' Board, or as an
employee, officer and/or director of the Manager, Distributor, or Transfer
Agent, or their respective legal counsel, not to disclose such information
except in conformity with these policies and procedures and not to trade for
his/her personal account on the basis of such information: o Employees of the
Funds' Manager, Distributor and Transfer Agent who
         need to have access to such information (as determined by senior
         officers of such entity),
o     The Funds' certified public accountants and independent registered
         public accounting firm,
o Members of the Funds' Board and the Board's legal counsel, o The Funds'
custodian bank, o A proxy voting service designated by the Funds and its Board,
o Rating/ranking organizations (such as Lipper and Morningstar), o Insurance
companies having separate accounts invested in Oppenheimer
         Variable Account Funds or Panorama Series Fund, Inc. (to prepare
         their financial statements or analysis),
                                    --
o     Portfolio pricing services retained by the Manager to provide portfolio
         security prices, and
o        Dealers, to obtain bids (price quotations, if securities are not priced
         by the Funds' regular pricing services).

      Portfolio holdings information of the Fund may be provided, under limited
circumstances, to brokers and/or dealers with whom the Funds trades and/or
entities that provide investment coverage and/or analytical information
regarding the Funds' portfolio, provided that there is a legitimate investment
reason for providing the information to the broker, dealer or other entity.
Month-end portfolio holdings information may, under this procedure, be provided
to vendors providing research information and/or analytics to the Funds, with at
least a 15-day delay after the month end, but in certain cases may be provided
to a broker or analytical vendor with a 1- 2 day lag to facilitate the provision
of requested investment information to the manager to facilitate a particular
trade or the portfolio manager's investment process for the Funds. Any third
party receiving such information must first sign the Manager's portfolio
holdings non-disclosure agreement as a pre-condition to receiving this
information.

      Portfolio holdings information (which may include information on
individual securities positions or multiple securities) may be provided to the
entities listed below (1) by portfolio traders employed by the Manager in
connection with portfolio trading, and (2) by the members of the Manager's
Security Valuation Group and Accounting Departments in connection with portfolio
pricing or other portfolio evaluation purposes: o Brokers and dealers in
connection with portfolio transactions
         (purchases and sales)
o        Brokers and dealers to obtain bids or bid and asked prices (if
         securities held by a Fund are not priced by the Funds' regular pricing
         services)
o        Dealers to obtain price quotations where the Funds are not identified
         as the owner.

      Portfolio holdings information (which may include information on each
Fund's entire portfolio or individual securities therein) may be provided by
senior officers of the Manager or attorneys on the legal staff of the Manager,
Distributor, or Transfer Agent, in the following circumstances: o Response to
legal process in litigation matters, such as responses to
         subpoenas or in class action matters where the Funds may be part of the
         plaintiff class (and seeks recovery for losses on a security) or a
         defendant,
o        Response to regulatory requests for information (the SEC, NASD, state
         securities regulators, and/or foreign securities authorities, including
         without limitation requests for information in inspections or for
         position reporting purposes),
o     To potential sub-advisers of portfolios (pursuant to confidentiality
         agreements),
o     To consultants for retirement plans for plan sponsors/discussions at
         due diligence meetings (pursuant to confidentiality agreements),
o        Investment bankers in connection with merger discussions (pursuant to
         confidentiality agreements).

      Portfolio managers and analysts may, subject to the Manager's policies on
communications with the press and other media, discuss portfolio information in
interviews with members of the media, or in due diligence or similar meetings
with clients or prospective purchasers of Fund shares or their financial
intermediary representatives.

      The shareholders of Global Securities Fund/VA, Main Street Fund/VA and
Strategic Bond Fund/VA may, under unusual circumstances (such as a lack of
liquidity in the Funds' portfolio to meet redemptions), receive redemption
proceeds of their Fund shares paid as pro rata shares of securities held in the
Funds' portfolio. In such circumstances, disclosure of the Funds' portfolio
holdings may be made to such shareholders.

      The Chief Compliance Officer of the Funds and the Manager, Distributor,
and Transfer Agent (the "CCO") shall oversee the compliance by the Manager,
Distributor, Transfer Agent, and their personnel with these policies and
procedures. At least annually, the CCO shall report to the Funds' Board on such
compliance oversight and on the categories of entities and individuals to which
disclosure of portfolio holdings of the Funds have been made during the
preceding year pursuant to these policies. The CCO shall report to the Funds'
Board any material violation of these policies and procedures during the
previous calendar quarter and shall make recommendations to the Companies and to
the Boards as to any amendments that the CCO believes are necessary and
desirable to carry out or improve these policies and procedures.

      The Manager and/or the Funds have entered into ongoing arrangements to
make available information about the Funds' portfolio holdings. One or more of
the Oppenheimer funds may currently disclose portfolio holdings information
based on ongoing arrangements to the following parties:

A.G. Edwards & Sons Fixed Income Securities Natexis Bleichroeder ABG Securities
Fortis Securities Ned Davis Research
                                                         Group
ABN AMRO                       Fox-Pitt, Kelton          Nomura Securities
Advest                         Friedman, Billing, Ramsey Pacific Crest
AG Edwards                     Fulcrum Global Partners   Pacific Crest
                                                         Securities
American Technology Research   Garp Research             Pacific Growth
                                                         Equities
Auerbach Grayson               George K Baum & Co.       Petrie Parkman
Banc of America Securities     Goldman                   Pictet
Barclays                       Goldman Sachs             Piper Jaffray Inc.
Baseline                       HSBC                      Plexus
Bear Stearns                   HSBC Securities Inc       Prager Sealy & Co.
Belle Haven                    ING Barings               Prudential Securities
Bloomberg                      ISI Group                 Ramirez & Co.
BNP Paribas                    Janney Montgomery         Raymond James
BS Financial Services          Jefferies                 RBC Capital Markets
Buckingham Research Group      Jeffries & Co.            RBC Dain Rauscher
Caris & Co.                    JP Morgan                 Research Direct
CIBC World Markets             JP Morgan Securities      Robert W. Baird
Citigroup                      JPP Eurosecurities        Roosevelt & Cross
Citigroup Global Markets       Keefe, Bruyette & Woods   Russell Mellon
Collins Stewart                Keijser Securities        Ryan Beck & Co.
Craig-Hallum Capital Group LLC Kempen & Co. USA Inc.     Sanford C. Bernstein
Credit Agricole Cheuvreux      Kepler Equities/Julius    Scotia Capital Markets
N.A. Inc.                      Baer Sec
Credit Suisse First Boston     KeyBanc Capital Markets   SG Cowen & Co.
Daiwa Securities               Leerink Swan              SG Cowen Securities
Davy                           Legg Mason                Soleil Securities
                                                         Group
Deutsche Bank                  Lehman                    Standard & Poors
Deutsche Bank Securities       Lehman Brothers           Stone & Youngberg
Dresdner Kleinwort Wasserstein Lipper                    SWS Group
Emmet & Co                     Loop Capital Markets      Taylor Rafferty
Empirical Research             MainFirst Bank AG         Think Equity Partners
Enskilda Securities            Makinson Cowell US Ltd    Thomas Weisel Partners
Essex Capital Markets          Maxcor Financial          UBS
Exane BNP Paribas              Merrill                   Wachovia
Factset                        Merrill Lynch             Wachovia Corp
Fidelity Capital Markets       Midwest Research          Wachovia Securities
Fimat USA Inc.                 Mizuho Securities         Wescott Financial
First Albany                   Morgan Stanley            William Blair
First Albany Corporation       Morningstar               Yieldbook

How the Funds Are Managed

Organization and History. Each Fund is an investment portfolio, or "series" of
Oppenheimer Variable Account Funds (the "Trust"), a multi-series open-end
diversified management investment company organized as a Massachusetts business
trust that presently includes 11 series. Money Fund/VA, Core Bond Fund/VA and
Capital Appreciation Fund/VA were all organized in 1983, High Income Fund/VA,
Aggressive Growth Fund/VA and Balanced Fund/VA, were all organized in 1986,
Global Securities Fund/VA was organized in 1990, Strategic Bond Fund/VA was
organized in 1993, Main Street Fund(R)/VA was organized in 1995, Main Street
Small Cap Fund(R)/VA was organized in 1998 and Value Fund/ VA was organized in
2002. Prior to May 1, 1998, Oppenheimer Aggressive Growth Fund/VA was named
"Oppenheimer Capital Appreciation Fund." The suffix "VA" was added to each
Fund's name on May 1, 1999. Prior to that date, Oppenheimer Capital Appreciation
Fund/VA was named "Oppenheimer Growth Fund," and Oppenheimer Main Street(R)
Growth & Income Fund/VA was named "Oppenheimer Growth & Income Fund." Prior to
May 1, 2001, Oppenheimer Main Street Small Cap Fund(R)/VA was named "Oppenheimer
Small Cap Growth Fund/VA." Prior to May 1, 2003, Oppenheimer Main Street
Fund(R)/VA was named "Oppenheimer Main Street(R) Growth & Income Fund/VA." Prior
to April 29, 2004, Oppenheimer Balanced Fund/VA was named "Oppenheimer Multiple
Strategies Fund/VA." Prior to April 29, 2005, Oppenheimer Core Bond Fund/VA was
named "Oppenheimer Bond Fund/VA." All references to the Funds' Board of Trustees
and Officers refer to the Trustees and Officers, respectively, of Oppenheimer
Variable Account Funds.

|X| Classes of Shares. The Trustees are authorized, without shareholder
approval, to create new series and classes of shares. The Trustees may
reclassify unissued shares of a Fund into additional series or classes of
shares. The Trustees also may divide or combine the shares of a class into a
greater or lesser number of shares without changing the proportionate beneficial
interest of a shareholder in the Funds. Shares do not have cumulative voting
rights or preemptive or subscription rights. Shares may be voted in person or by
proxy at shareholder meetings.

      The Funds currently have four classes of shares authorized. All Funds
offer a class of shares with no name designation referred to in this Statement
of Additional Information and the Prospectus as "non-service shares." As of
December 31, 2004, all Funds except Money Fund/VA and Value Fund/VA also offered
a service share class, subject to a Distribution and Service Plan. Money Fund/VA
and Value Fund/VA currently only offer the class of non-service shares. Global
Securities Fund/VA offers two additional share classes, referred to in this
Statement of Additional Information and the Global Securities Fund/VA Prospectus
as "Class 3"and "Class 4", which are subject to a redemption fee. In addition,
Class 4 shares are subject to a Distribution and Service Plan. Each class of
shares:
o     has its own dividends and distributions,
o pays certain expenses which may be different for the different classes, o will
generally have a different net asset value, o will generally have separate
voting rights on matters in which
         interests of one class are different from interests of another
         class, and
o     votes as a class on matters that affect that class alone.

      Shares are freely transferable under the terms of the insurance product,
and each share of each class has one vote at shareholder meetings, with
fractional shares voting proportionally, on matters submitted to a vote of
shareholders. Each share of a Fund represents an interest in each Fund
proportionately equal to the interest of each other share of the same class of
that Fund.

|X| Meetings of Shareholders. The Trust is a Massachusetts business trust, the
 Funds are not required to hold, and does not plan to hold, regular annual
 meetings of shareholders, but may hold shareholder meetings from time to time
 on important matters or when required to do so by the Investment Company Act or
 other applicable law. Shareholders have the right, upon a vote or declaration
 in writing of two-thirds of the outstanding shares of the Fund, to remove a
 Trustee or to take other action described in the Trust's Declaration of Trust.

      The Trustees will call a meeting of shareholders to vote on the removal of
a Trustee upon the written request of the record holders of 10% of its
outstanding shares. If the Trustees receive a request from at least 10
shareholders stating that they wish to communicate with other shareholders to
request a meeting to remove a Trustee, the Trustees will then either make the
Funds' shareholder list available to the applicants or mail their communication
to all other shareholders at the applicants' expense. The shareholders making
the request must have been shareholders for at least six months and must hold
shares of the Fund valued at $25,000 or more or constituting at least 1% of the
Funds' outstanding shares. The Trustees may also take other action as permitted
by the Investment Company Act.

|X| Shareholder and Trustee Liability. The Trust's Declaration of Trust contains
an express disclaimer of shareholder or Trustee liability for the Trust'
obligations. It also provides for indemnification and reimbursement of expenses
out of the Trust' property for any shareholder held personally liable for its
obligations. The Declaration of Trust also states that upon request, the Trust
shall assume the defense of any claim made against a shareholder for any act or
obligation of the Trust and shall satisfy any judgment on that claim.
Massachusetts law permits a shareholder of a business trust (such as the Trust)
to be held personally liable as a "partner" under certain circumstances.
However, the risk that a Fund shareholder will incur financial loss from being
held liable as a "partner" of the Trust is limited to the relatively remote
circumstances in which the Trust would be unable to meet its obligations.

      The Trust's contractual arrangements state that any person doing business
with the Trust (and each shareholder of the Funds) agrees under its Declaration
of Trust to look solely to the assets of the Fund for satisfaction of any claim
or demand that may arise out of any dealings with the Funds and that the
Trustees shall have no personal liability to any such person, to the extent
permitted by law.

Board of Trustees and Oversight Committees. The Funds are governed by a Board of
Trustees, which is responsible for protecting the interests of shareholders
under Massachusetts law. The Trustees meet periodically throughout the year to
oversee the Funds' activities, review their performance, and review the actions
of the Manager.

      The Board of Trustees has an Audit Committee, a Review Committee and a
Governance Committee. Each committee is comprised solely of Trustees who are not
"interested persons" under the Investment Company Act (the "Independent
Trustees"). The members of the Audit Committee are Edward L. Cameron (Chairman),
George C. Bowen, Robert J. Malone and F. William Marshall, Jr. The Audit
Committee held 7 meetings during the Funds' fiscal year ended December 31, 2004.
The Audit Committee furnishes the Board with recommendations regarding the
selection of the Fund's independent registered public accounting firm (also
referred to as the "independent Auditors"). Other main functions of the Audit
Committee, outlined in the Audit Committee Charter, include, but are not limited
to: (i) reviewing the scope and results of financial statement audits and the
audit fees charged; (ii) reviewing reports from the Funds' independent Auditors
regarding the Funds' internal accounting procedures and controls; (iii)
reviewing reports from the Manager's Internal Audit Department; (iv) reviewing
certain reports from and meet periodically with the Funds' Chief Compliance
Officer; (v) maintaining a separate line of communication between the Funds'
independent Auditors and the Independent Trustees; (vi) reviewing the
independence of the Funds' independent Auditors; and (vii) pre-approving the
provision of any audit or non-audit services by the Funds' independent Auditors,
including tax services, that are not prohibited by the Sarbanes-Oxley Act, to
the Funds, the Manager and certain affiliates of the Manager.

      The Review Committee is comprised solely of Independent Trustees. The
members of the Review Committee are Jon S. Fossel (Chairman), Robert G. Avis,
Sam Freedman and Beverly L. Hamilton. The Review Committee held 6 meetings
during the Funds' fiscal year ended December 31, 2004. Among other duties, as
set forth in the Review Committee's Charter, the Review Committee reports and
makes recommendations to the Board concerning the fees paid to the Funds'
transfer agent and the Manager and the services provided to the Funds by the
transfer agent and the Manager. The Review Committee also reviews the Funds'
investment performance as well as the policies and procedures adopted by the
Funds to comply with the Investment Company Act and other applicable law.

      The Governance Committee is comprised solely of Independent Trustees. The
members of the Governance Committee are, Robert J. Malone (Chairman), William
Armstrong, Beverly L. Hamilton and F. William Marshall, Jr. The Governance
Committee held 2 meetings during the Funds' fiscal year ended December 31, 2004.
The Governance Committee has adopted a charter setting forth its duties and
responsibilities. Among other duties, the Governance Committee reviews and
oversees the Funds' governance guidelines, the adequacy of the Funds' Codes of
Ethics and the nomination of Trustees, including Independent Trustees. The
Governance Committee has adopted a process for shareholder submission of
nominees for board positions. Shareholders may submit names of individuals,
accompanied by complete and properly supported resumes, for the Governance
Committee's consideration by mailing such information to the Governance
Committee in care of the Funds. The Governance Committee may consider such
persons at such time as it meets to consider possible nominees. The Governance
Committee, however, reserves sole discretion to determine which candidates for
Trustees and Independent Trustees it will recommend to the Board and/or
shareholders and it may identify candidates other than those submitted by
Shareholders. The Governance Committee may, but need not, consider the advice
and recommendation of the Manager and/or its affiliates in selecting nominees.
The full Board elects new Trustees except for those instances when a shareholder
vote is required.

      Shareholders who desire to communicate with the Board should address
correspondence to the Board or an individual Board member and may submit their
correspondence electronically at www.oppenheimerfunds.com under the caption
"contact us" or by mail to the Funds at the address below. The Governance
Committee will consider if a different process should be recommended to the
Board.

Trustees and Officers of the Funds. Except for Mr. Murphy, each of the
Trustees is an Independent Trustee. All of the Trustees are also trustees or
directors of the following Oppenheimer/Centennial funds (referred to as
"Board II Funds"):

                                           Oppenheimer   Principal   Protected
Oppenheimer Cash Reserves                  Trust II
                                           Oppenheimer   Principal   Protected
Oppenheimer Capital Income Fund            Trust III
Oppenheimer Champion Income Fund           Oppenheimer Real Asset Fund
                                           Oppenheimer  Senior  Floating  Rate
Oppenheimer Equity Fund, Inc.              Fund
Oppenheimer High Yield Fund                Oppenheimer Strategic Income Fund
Oppenheimer Integrity Funds                Oppenheimer Variable Account Funds
Oppenheimer International Bond Fund        Panorama Series Fund, Inc.
Oppenheimer Limited-Term Government Fund
                                           Centennial  California  Tax  Exempt
Oppenheimer Main Street Funds, Inc.        Trust
Oppenheimer Main Street Opportunity Fund   Centennial Government Trust
Oppenheimer Main Street Small Cap Fund     Centennial Money Market Trust
                                           Centennial   New  York  Tax  Exempt
Oppenheimer Municipal Fund                 Trust
Oppenheimer Principal Protected Trust      Centennial Tax Exempt Trust

      Present or former officers, directors, trustees and employees (and their
immediate family members) of the Funds, the Manager and its affiliates, and
retirement plans established by them for their employees are permitted to
purchase Class A shares of the Funds and the other Oppenheimer funds at net
asset value without sales charge. The sales charge on Class A shares is waived
for that group because of the reduced sales efforts realized by the Distributor.

      Messrs. Baylin, Bhaman, Bomfim, Caan, Ferreira, Gillespie, Gord, Kourkoulakos,
Leavy, Manioudakis, Monoyios, Moon, Murphy,O'Hare, Petersen, Reinganum,
Steinmetz, Vandehey, Vottiero, Weiss, Wilby, Wixted, Zack and Zavanelli and Mss.
Bloomberg, Ives and Wolf, who are officers of the Funds, hold the same
offices with one or more of the other Board II Funds. As of March 31, 2005 the
Trustees and officers of the Funds, as a group, owned of record or beneficially
less than 1% of any class of shares of the Funds. The foregoing statement does
not reflect ownership of shares held of record by an employee benefit plan for
employees of the Manager, other than the shares beneficially owned under that
plan by the officers of the Board II Funds. In addition, none of the Independent
Trustees (nor any of their immediate family members) owns securities of either
the Manager or the Distributor or of any entity directly or indirectly
controlling, controlled by or under common control with the Manager or the
Distributor of the Board II Funds.

      Biographical Information. The Trustees and officers, their positions with
the Trust, length of service in such position(s), and principal occupations and
business affiliations during at least the past five years are listed in the
charts below. The charts also include information about each Trustee's
beneficial share ownership in the Funds and in all of the registered investment
companies that the Trustee oversees in the Oppenheimer family of funds
("Supervised Funds"). The address of each Trustee in the chart below is 6803 S.
Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an
indefinite term, or until his or her resignation, retirement, death or removal.

- ---------------------------------------------------------------------------------------------
                                    Independent Trustees
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Name, Position(s)    Principal Occupation(s) During the Past 5         Dollar     Aggregate
                                                                                   Dollar
                                                                                  Range of
                                                                                   Shares
                                                                      Range of   Beneficially
                                                                       Shares     Owned in
with the Trust,      Years; Other Trusteeships/Directorships Held;  Beneficially     All
Length of Service,   Number of Portfolios in the Fund Complex         Owned in   Supervised
Age                  Currently Overseen                              the Trust      Funds
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
                                                                    As of December 31, 2004
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
William L.           Chairman of the following private mortgage     None         Over
Armstrong,           banking companies: Cherry Creek Mortgage                    $100,000
Chairman of the      Company (since 1991), Centennial State
Board of Trustees    Mortgage Company (since 1994), and The El
since 2003, Trustee  Paso Mortgage Company (since 1993); Chairman
since 1999           of the following private companies:
Age: 68              Ambassador Media Corporation (since 1984) and
                     Broadway Ventures (since 1984); Director of the following:
                     Helmerich & Payne, Inc. (oil and gas drilling/production
                     company) (since 1992), Campus Crusade for Christ (since
                     1991) and The Lynde and Harry Bradley Foundation, Inc.
                     (non-profit organization) (since 2002); former Chairman of
                     the following: Transland Financial Services, Inc. (private
                     mortgage banking company) (1997-2003), Great Frontier
                     Insurance (insurance agency) (1995-2000), Frontier Real
                     Estate, Inc. (residential real estate brokerage)
                     (1994-2000) and Frontier Title (title insurance agency)
                     (1995-2000); former Director of the following:
                     UNUMProvident (insurance company) (1991-2004), Storage
                     Technology Corporation (computer equipment company)
                     (1991-2003) and International Family Entertainment
                     (television channel) (1992-1997); U.S. Senator (January
                     1979-January 1991). Oversees 38 portfolios in the
                     OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Robert G. Avis,      Director and President of A.G. Edwards         None         Over
Trustee since 1993   Capital, Inc. (General Partner of private                   $100,000
Age: 74              equity funds) (until February 2001);
                     Chairman, President and Chief Executive
                     Officer of A.G. Edwards Capital, Inc. (until
                     March 2000); Director of A.G. Edwards & Sons,
                     Inc. (brokerage company) (until 2000) and
                     A.G. Edwards Trust Company (investment
                     adviser) (until 2000); Vice Chairman and
                     Director of A.G. Edwards, Inc. (until March
                     1999); Vice Chairman of A.G. Edwards & Sons,
                     Inc. (until March 1999); Chairman of A.G.
                     Edwards Trust Company (until March 1999) and
                     A.G.E. Asset Management (investment adviser)
                     (until March 1999). Oversees 38 portfolios in
                     the OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
George C. Bowen,     Assistant Secretary and Director of            None         Over
Trustee since 1999   Centennial Asset Management Corporation                     $100,000
Age: 69              (December 1991-April 1999); President,
                     Treasurer and Director of Centennial Capital
                     Corporation (June 1989-April 1999); Chief
                     Executive Officer and Director of MultiSource
                     Services, Inc. (March 1996-April 1999); Mr.
                     Bowen held several positions with the Manager
                     and with subsidiary or affiliated companies
                     of the Manager (September 1987-April 1999).
                     Oversees 38 portfolios in the
                     OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Edward L. Cameron,   Member of The Life Guard of Mount Vernon       None         Over
Trustee since 1999   (George Washington historical site) (since                  $100,000
Age: 67              June 2000); Director of Genetic ID, Inc.
                     (biotech company) (March 2001-May 2002); Partner at
                     PricewaterhouseCoopers LLP (accounting firm) (July
                     1974-June 1999); Chairman of Price Waterhouse LLP Global
                     Investment Management Industry Services Group (July
                     1994-June 1998). Oversees 38 portfolios in the
                     OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Jon S. Fossel,       Director of UNUMProvident (insurance company)  None         Over
Trustee since 1990   (since June 2002); Director of Northwestern                 $100,000
Age: 63              Energy Corp. (public utility corporation)
                     (since November 2004); Director of P.R.
                     Pharmaceuticals (October 1999-October 2003);
                     Director of Rocky Mountain Elk Foundation
                     (non-profit organization) (February
                     1998-February 2003); Chairman and Director
                     (until October 1996) and President and Chief
                     Executive Officer (until October 1995) of the
                     Manager; President, Chief Executive Officer
                     and Director of the following: Oppenheimer
                     Acquisition Corp. ("OAC") (parent holding
                     company of the Manager), Shareholders
                     Services, Inc. and Shareholder Financial
                     Services, Inc. (until October 1995). Oversees
                     38 portfolios in the OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Sam Freedman,        Director of Colorado Uplift (charitable        None         Over
Trustee since 1996   organization) (since September 1984). Mr.                   $100,000
Age: 65              Freedman held several positions with the
                     Manager and with subsidiary or affiliated companies of the
                     Manager (until October 1994). Oversees 38 portfolios in the
                     OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Beverly L. Hamilton, Trustee of Monterey Institute for              None         Over
Trustee since 2002   International Studies (educational                          $100,000
Age: 59              organization) (since February 2000); Director
                     of The California Endowment (philanthropic organization)
                     (since April 2002); Director of Community Hospital of
                     Monterey Peninsula (since February 2002); Director of
                     American Funds' Emerging Markets Growth Fund, Inc. (mutual
                     fund) (since October 1991); President of ARCO Investment
                     Management Company (February 1991-April 2000); Member of
                     the investment committees of The Rockefeller Foundation and
                     The University of Michigan; Advisor at Credit Suisse First
                     Boston's Sprout venture capital unit (venture capital fund)
                     (1994-January 2005); Trustee of MassMutual Institutional
                     Funds (investment company) (1996-June 2004); Trustee of MML
                     Series Investment Fund (investment company) (April
                     1989-June 2004); Member of the investment committee of
                     Hartford Hospital (2000-2003); and Advisor to Unilever
                     (Holland) pension fund (2000-2003). Oversees 38 portfolios
                     in the OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Robert J. Malone,    Director of Jones International University     None         Over
Trustee since 2002   (educational organization) (since August                    $100,000
Age: 61              2005); Chairman, Chief Executive Officer and
                     Director of Steele Street State Bank (commercial banking)
                     (since August 2003); Director of Colorado UpLIFT
                     (charitable organization) (since 1986); Trustee of the
                     Gallagher Family Foundation (non-profit organization)
                     (since 2000); Former Chairman of U.S. Bank-Colorado
                     (subsidiary of U.S. Bancorp and formerly Colorado National
                     Bank) (July 1996-April 1999); Director of Commercial
                     Assets, Inc. (real estate investment trust) (1993-2000);
                     Director of Jones Knowledge, Inc. (2001-July 2004); and
                     Director of U.S. Exploration, Inc. (oil and gas
                     exploration) (1997-February 2004). Oversees 38 portfolios
                     in the OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
F. William Trustee of MassMutual Select Funds (formerly None Over Marshall, Jr.,
MassMutual Institutional Funds) (investment $100,000 Trustee since 2000 company)
(since 1996) and MML Series Age: 63 Investment Fund (investment company) (since
                     1996), the Springfield Library and Museum Association
                     (museums) (since 1995) and the Community Music School of
                     Springfield (music school) (since 1996); Chairman and
                     Trustee (since 2003) and Chairman of the Investment
                     Committee (since 1994) of the Worcester Polytech Institute
                     (private university); President and Treasurer of the SIS
                     Funds (private charitable fund) (since January 1999);
                     Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank)
                     (commercial bank) (January 1999-July 1999); Member of the
                     Investment Committee of the Community Foundation of Western
                     Massachusetts (1998-2003); and Executive Vice President of
                     Peoples Heritage Financial Group, Inc. (commercial bank)
                     (January 1999-July 1999). Oversees 40 portfolios in the
                     OppenheimerFunds complex.*
- ---------------------------------------------------------------------------------------------

The address of Mr. Murphy is Two World Financial Center, 225 Liberty Street,
11th Floor, New York, New York 10281-1008. Mr. Murphy serves as a Trustee for an
indefinite term, or until his resignation, retirement, death or removal and as
an officer for an indefinite term, or until his resignation, retirement, death
or removal. Mr. Murphy is an "Interested Trustee" because he is affiliated with
the Manager by virtue of his positions as an officer and director of the
Manager, and as a shareholder of its parent company. Mr. Murphy was elected as a
Trustee of the Trust with the understanding that in the event he ceases to be
the chief executive officer of the Manager, he will resign as a Trustee of the
Trust and the other Board II Funds (defined below) for which he is a director or
trustee.

- -------------------------------------------------------------------------------------
                           Interested Trustee and Officer
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Name,                Principal Occupation(s) During Past 5    Dollar     Aggregate
                                                                         Dollar
                                                                         Range Of
                                                                         Shares
                                                                         Beneficially
                                                                         Owned in
                     Years;                                   Range of   Any of the
Position(s) Held     Other Trusteeships/Directorships Held    Shares     Oppenheimer
with Trust,          by Trustee ;                             BeneficiallFunds
Length of Service,   Number of Portfolios in Fund Complex     Owned in   Overseen
Age                  Currently Overseen by Trustee            the Trust  by Trustee
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
                                                                As of December 31,
                                                                            2004
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
John V. Murphy,      Chairman, Chief Executive Officer and    None       Over
President and        Director (since June 2001) and                      $100,000
Trustee since 2001   President (since September 2000) of the
Age: 56              Manager; President and director or
                       trustee of other Oppenheimer funds;
                     President and Director of OAC and of Oppenheimer
                     Partnership Holdings, Inc. (holding company subsidiary of
                     the Manager) (since July 2001); Director of
                     OppenheimerFunds Distributor, Inc. (subsidiary of the
                     Manager) (since November 2001); Chairman and Director of
                     Shareholder Services, Inc. and of Shareholder Financial
                     Services, Inc. (transfer agent subsidiaries of the Manager)
                     (since July 2001); President and Director of
                     OppenheimerFunds Legacy Program (charitable trust program
                     established by the Manager) (since July 2001); Director of
                     the following investment advisory subsidiaries of the
                     Manager: OFI Institutional Asset Management, Inc.,
                     Centennial Asset Management Corporation, Trinity Investment
                     Management Corporation and Tremont Capital Management, Inc.
                     (since November 2001), HarbourView Asset Management
                     Corporation and OFI Private Investments, Inc. (since July
                     2001); President (since November 2001) and Director (since
                     July 2001) of Oppenheimer Real Asset Management, Inc.;
                     Executive Vice President of Massachusetts Mutual Life
                     Insurance Company (OAC's parent company) (since February
                     1997); Director of DLB Acquisition Corporation (holding
                     company parent of Babson Capital Management LLC) (since
                     June 1995); Member of the Investment Company Institute's
                     Board of Governors (since October 3, 2003); Chief Operating
                     Officer of the Manager (September 2000-June 2001);
                     President and Trustee of MML Series Investment Fund and
                     MassMutual Select Funds (open-end investment companies)
                     (November 1999-November 2001); Director of C.M. Life
                     Insurance Company (September 1999-August 2000); President,
                     Chief Executive Officer and Director of MML Bay State Life
                     Insurance Company (September 1999-August 2000); Director of
                     Emerald Isle Bancorp and Hibernia Savings Bank
                     (wholly-owned subsidiary of Emerald Isle Bancorp) (June
                     1989-June 1998). Oversees 77 portfolios as an officer and
                     director or trustee and 10 additional portfolios as an
                     officer in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------

The addresses of the officers in the chart below are as follows: for Messrs.
Baylin, Bhaman, Bomfim, Caan, Ferreira, Gillespie, Gord, Kourkoulakos, Leavy,
Manioudakis, Monoyios, Moon, O'Hare, Reinganum, Steinmetz, Wilby, Zack and
Zavanelli and Ms. Bloomberg, Two World Financial Center, 225
Liberty Street, New York, New York 10281-1008, for Messrs. Petersen,
Vandehey, Vottiero, Weiss and Wixted and Mss. Ives and Wolf, 6803 S. Tucson
Way, Centennial, Colorado 80112-3924. Each officer serves for an indefinite
term or until his or her resignation, retirement death or removal.

- -----------------------------------------------------------------------------------------
                              Other Officers of the Trust
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Name, Position(s)      Principal Occupation(s) During Past 5 Years
Held with the Trust,
Length of Service, Age
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Marc L. Baylin, Portfolio Manager since 2005
Age: 37
Vice President of the Manager and a member of the Manager's Growth Equity
Investment Team. He was Managing Director and Lead Portfolio Manager at JP Morgan
Fleming Investment Management from June 2002 to August 2005 and was a Vice
President of T. Rowe Price, where he was an analyst from June 1993 and a portfolio
manager from March 1999 to June 2002. A portfolio manager of other Oppenheimer
funds.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Rajeev Bhaman, Vice President of the Manager since January 1997; Assistant Vice
Vice President and President of the Manager (March 1996-January 1997). An
officer Portfolio Manager of 2 portfolios in the OppenheimerFunds complex.
since 2004
Age: 42
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Antulio Bomfim, Vice President of the Manager since October 2003; Senior Vice
President and Economist at the Board of Governors of the Federal Reserve
Portfolio Manager System from June 1992 to October 2003. A portfolio manager of
11 since 2003 other portfolios in the OppenheimerFunds complex.
Age: 38
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Geoffrey Caan,         Vice President and Portfolio Manager of the Manager since August
Vice President and     2003; Vice President of ABN AMRO NA, Inc. (June 2002-August
Portfolio Manager      2003); Vice President of Zurich Scudder Investments (January
since 2003             1999-June 2002). A portfolio manager of 11 other portfolios in
Age: 36                the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Emmanuel Ferreira, Vice President of the Manager since January 2003; Portfolio
Vice President and Manager at Lashire Investments (July 1999-December 2002). An
Portfolio Manager officer of 5 portfolios in the OppenheimerFunds complex.
since 2003
Age: 38
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Benjamin J. Gord,      Vice President of the Manager (since April 2002), of HarbourView
Vice President and     Asset Management Corporation (since April 2002) and of OFI
Portfolio Manager      Institutional Asset Management, Inc. (as of June 2002);
since 2003             Executive Director and senior fixed income analyst at Miller
Age: 43                Anderson & Sherrerd, a division of Morgan Stanley Investment
                       Management (April 1992-March 2002). A portfolio manager
                       of 11 other portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Dimitrios Vice President of the Manager since December 2001; High Yield
Kourkoulakos, Analyst (1998-2001) and a Securities Analyst (1995-1998) of the
Vice President and Manager. An officer of 3 portfolios in the OppenheimerFunds
Portfolio Manager complex.
since 2002
Age: 39
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Christopher Leavy,     Senior Vice President of the Manager since September 2000;
Vice President and     portfolio manager of Morgan Stanley Dean Witter Investment
Portfolio Manager      Management (1997-September 2000). An officer of 8 portfolios in
since 2002             the OppenheimerFunds complex.
Age: 34
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Angelo Manioudakis,    Senior Vice President of the Manager (since April 2002), of
Vice President and     HarbourView Asset Management Corporation (since April, 2002 and
Portfolio Manager      of OFI Institutional Asset Management, Inc. (since June 2002);
since 2002             Executive Director and portfolio manager for Miller, Anderson &
Age: 39                Sherrerd, a division of Morgan Stanley Investment Management
                       (August 1993-April 2002). An officer of 14 portfolios in
                       the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Nikolaos D. Monoyios,  Senior Vice President of the Manager since October 2003; a
Vice President and     Certified Financial Analyst. Formerly Vice President of the
Portfolio Manager      Manager (April 1998-September 2003). An officer of 6 portfolios
since 1999             in the OppenheimerFunds complex.
Age: 56
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Charles Moon,          Vice President of the Manager (since April 2002, of HarbourView
Vice President and     Asset Management Corporation (since April 2002) and of OFI
Portfolio Manager      Institutional Asset Management, Inc. (since June 2002);
since 2003             Executive Director and portfolio manager at Miller Anderson &
Age: 38                Sherrerd, a division of Morgan Stanley Investment Management
                       (June 1999-March 2002); Vice President of Citicorp
                       Securities Inc. (June 1993-May 1999). A portfolio manager
                       of 11 other portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
John O'Hare,           Vice President of the Manager since September 2003; Executive
Vice President and     Vice President and Portfolio Manager (June 2000-August 2003) and
Portfolio Manager      Portfolio Manager and Senior Vice President (August 1997-June
since 2003             2000) at Geneva Capital Management, Ltd. (an investment
Age: 47                advisor). Mr. O'Hare holds a BBA in Finance and Economics from
                       the University of Wisconsin and is a Chartered Financial
                       Analyst. An officer of 2 portfolios in the OppenheimerFunds
                       complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------

Dr. Marc Reinganum, Vice President of the Manager since September 2002; a
Director Vice President and of Quantitative Research and Portfolio Strategist
for Equities; Portfolio Manager the Mary Jo Vaughn Rauscher Chair in Financial
Investments at since 2003 Southern Methodist University since 1995. At Southern
Methodist Age: 52 University he also served as the Director of the Finance
                       Institute, Chairman of the Finance Department, President
                       of the Faculty at the Cox School of Business and member
                       of the Board of Trustee Investment Committee. An officer
                       of 3 portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Arthur P. Steinmetz, Senior Vice President of the Manager (since March 1993) and
of Vice President and HarbourView Asset Management Corporation (since March
2000). An Portfolio Manager officer of 4 portfolios in the OppenheimerFunds
complex.
since 1993
Age: 47
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Barry D. Weiss,        Vice President of the Manager (since July 2001) and of
Vice President and     HarbourView Asset Management Corporation (since June 2003); an
Portfolio Manager      officer of 6 portfolios in the OppenheimerFunds complex.
since 2001             Formerly Assistant Vice President and Senior Credit Analyst of
Age: 41                the Manager (February 2000-June 2001). Prior to joining the
                       Manager in February 2000, he was Associate Director, Structured
                       Finance, Fitch IBCA Inc. (April 1998-February 2000).
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
William L. Wilby,      Senior Vice President (since July 1994) and Senior Investment
Vice President and     Officer, Director of Equities (since July 2004) of the Manager.
Portfolio Manager      Formerly, Senior Investment Officer, Director of International
since 1995             Equities of the Manager (May 2000-July 2004) and Senior Vice
Age: 61                President of HarbourView Asset Management Corporation (May
                       1999-November 2001). An officer of 6 portfolios in the
                       OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Carol E. Wolf, Senior Vice President of the Manager (since June 2000) and of
Vice President and HarbourView Asset Management Corporation (since June 2003);
an Portfolio Manager officer of 6 portfolios in the OppenheimerFunds complex.
since 1998 Formerly Vice President of the Manager (June 1990-June 2000).
Age: 53
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Mark Zavanelli, Vice President of the Manager since November 2000; a Chartered
Vice President and Financial Analyst; an officer of 3 portfolios in the
Portfolio Manager OppenheimerFunds complex. Prior to joining the Manager in May
since 2001 1998 he was President of Waterside Capital Management, a Age: 35
registered investment advisor (August 1995-April 1998).
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Mark S. Vandehey,      Senior Vice President and Chief Compliance Officer of the
Vice President and     Manager (since March 2004); Vice President of OppenheimerFunds
Chief Compliance       Distributor, Inc., Centennial Asset Management Corporation and
Officer since          Shareholder Services, Inc. (since June 1983); Vice President and
Age: 55                Director of Internal Audit of the Manager (1997-February 2004).
                       An officer of 87 portfolios in the OppenheimerFunds
complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Brian W. Wixted,       Senior Vice President and Treasurer of the Manager (since March
Treasurer since        1999); Treasurer of the following: HarbourView Asset Management
Age: 46                Corporation, Shareholder Financial Services, Inc., Shareholder
                       Services, Inc., Oppenheimer Real Asset Management
                       Corporation, and Oppenheimer Partnership Holdings, Inc.
                       (since March 1999), OFI Private Investments, Inc. (since
                       March 2000), OppenheimerFunds International Ltd. and
                       OppenheimerFunds plc (since May 2000), OFI Institutional
                       Asset Management, Inc. (since November 2000), and
                       OppenheimerFunds Legacy Program (since June 2003);
                       Treasurer and Chief Financial Officer of OFI Trust
                       Company (trust company subsidiary of the Manager) (since
                       May 2000); Assistant Treasurer of the following: OAC
                       (since March 1999), Centennial Asset Management
                       Corporation (March 1999-October 2003) and
                       OppenheimerFunds Legacy Program (April 2000-June 2003);
                       Principal and Chief Operating Officer of Bankers Trust
                       Company-Mutual Fund Services Division (March 1995-March
                       1999). An officer of 87 portfolios in the
                       OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Brian Petersen,        Assistant Vice President of the Manager (since August 2002);
Assistant Treasurer    Manager/Financial Product Accounting of the Manager (November
since                  1998-July 2002). An officer of 87 portfolios in the
Age: 35                OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Philip F. Vottiero,    Vice President/Fund Accounting of the Manager (since March
Assistant Treasurer    2002); Vice President/Corporate Accounting of the Manager (July
since                  1999-March 2002); Chief Financial Officer of Sovlink Corporation
Age: 42                (April 1996-June 1999). An officer of 87 portfolios in the
                       OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Robert G. Zack,        Executive Vice President (since January 2004) and General
Secretary since 2001   Counsel (since March 2002) of the Manager; General Counsel and
Age: 57                Director of the Distributor (since December 2001); General
                       Counsel of Centennial Asset Management Corporation (since
                       December 2001); Senior Vice President and General Counsel
                       of HarbourView Asset Management Corporation (since
                       December 2001); Secretary and General Counsel of OAC
                       (since November 2001); Assistant Secretary (since
                       September 1997) and Director (since November 2001) of
                       OppenheimerFunds International Ltd. and OppenheimerFunds
                       plc; Vice President and Director of Oppenheimer
                       Partnership Holdings, Inc. (since December 2002);
                       Director of Oppenheimer Real Asset Management, Inc.
                       (since November 2001); Senior Vice President, General
                       Counsel and Director of Shareholder Financial Services,
                       Inc. and Shareholder Services, Inc. (since December
                       2001); Senior Vice President, General Counsel and
                       Director of OFI Private Investments, Inc. and OFI Trust
                       Company (since November 2001); Vice President of
                       OppenheimerFunds Legacy Program (since June 2003); Senior
                       Vice President and General Counsel of OFI Institutional
                       Asset Management, Inc. (since November 2001); Director of
                       OppenheimerFunds (Asia) Limited (since December 2003);
                       Senior Vice President (May 1985-December 2003), Acting
                       General Counsel (November 2001-February 2002) and
                       Associate General Counsel (May 1981-October 2001) of the
                       Manager; Assistant Secretary of the following:
                       Shareholder Services, Inc. (May 1985-November 2001),
                       Shareholder Financial Services, Inc. (November
                       1989-November 2001), and OppenheimerFunds International
                       Ltd. (September 1997-November 2001). An officer of 87
                       portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Lisa I. Bloomberg,     Vice President and Associate Counsel of the Manager (since May
Assistant Secretary    2004); First Vice President (April 2001-April 2004), Associate
since 2004             General Counsel (December 2000-April 2004), Corporate Vice
Age: 37                President (May 1999-April 2001) and Assistant General Counsel
                       (May 1999-December 2000) of UBS Financial Services Inc.
                       (formerly, PaineWebber Incorporated). An officer of 87
                       portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Kathleen T. Ives,      Vice President (since June 1998) and Senior Counsel and
Assistant Secretary    Assistant Secretary (since October 2003) of the Manager; Vice
since                  President (since 1999) and Assistant Secretary (since October
Age: 40                2003) of the Distributor; Assistant Secretary of Centennial
                       Asset Management Corporation (since October 2003); Vice
                       President and Assistant Secretary of Shareholder Services, Inc.
                       (since 1999); Assistant Secretary of OppenheimerFunds Legacy
                       Program and Shareholder Financial Services, Inc. (since December
                       2001); Assistant Counsel of the Manager (August 1994-October
                       2003). An officer of 87 portfolios in the OppenheimerFunds
                       complex.
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
Phillip S. Gillespie,  Senior Vice President and Deputy General Counsel of the Manager
Assistant Secretary    (since September 2004); First Vice President (2000-September
since 2004             2004), Director (2000-September 2004) and Vice President
Age: 41                (1998-2000) of Merrill Lynch Investment Management. An officer
                       of 87 portfolios in the OppenheimerFunds complex.
- -----------------------------------------------------------------------------------------

|X| Remuneration of the Officers and Trustees. The officers and the interested
Trustee of the Funds who are affiliated with the Manager receive no salary or
fee from the Funds. The Independent Trustees received the compensation shown
below from the Funds for serving as a Trustee and member of a committee (if
applicable), with respect to the Funds' fiscal year ended December 31, 204. The
total compensation, including accrued retirement benefits, from the Funds and
fund complex represents compensation received for serving as a Trustee and
member of a committee (if applicable) of the Boards of the Funds and other funds
in the OppenheimerFunds complex during the calendar year ended December 31,
2004.




- ---------------------------------------------------------------------------------
Name of Trustee and Other Trust  Aggregate Compensation    Total Compensation
                                                              From the Trust and
Position(s) (as applicable)         From the Trust(1)        Fund Complex(2)
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
William L. Armstrong                     $35,842                $178,000
Chairman of the Board and
Governance Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert G. Avis                           $23,861                $118,500
Review Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
George C. Bowen                          $23,861                $118,500
Audit Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Edward L. Cameron                        $27,385                $136,000
Audit Committee Chairman
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jon S. Fossel                            $27,385                $136,000
Review Committee Chairman
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Sam Freedman                             $23,861                $118,500
Review Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Beverly Hamilton                       $23,358(3)              $152,355(5)
Review Committee Member and
Governance Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert J. Malone                       $24,510(3)               $121,726
Governance Committee Chairman
and
Audit Committee Member
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
F. William Marshall, Jr.                 $23,861               $167,500(6)
Audit Committee Member and
Governance Committee Member
- ---------------------------------------------------------------------------------
1. "Aggregate Compensation From the Trust" includes fees and deferred
   compensation, if any.
2. In accordance with SEC regulations, for purposes of this section only, "Fund
   Complex" includes the Oppenheimer funds, the MassMutual Institutional Funds,
   the MassMutual Select Funds and the MML Series Investment Fund, the
   investment adviser for which is the indirect parent company of the Trust's
   Manager. The Manager also serves as the Sub-Advisor to the following:
   MassMutual Premier International Equity Fund, MassMutual Premier Main Street
   Fund, MassMutual Premier Strategic Income Fund, MassMutual Premier Capital
   Appreciation Fund, and MassMutual Premier Global Fund. The Manager does not
   consider MassMutual Institutional Funds, MassMutual Select Funds and MML
   Series Investment Fund to be part of the OppenheimerFunds' "Fund Complex" as
   that term may be otherwise interpreted.
3. Includes $2,305 deferred by Ms. Hamilton under the "Deferred Compensation
   Plan" described below.
4. Includes $2,418 deferred by Mr. Malone under the "Deferred Compensation Plan"
   described below.
5. Includes $36,654 deferred by Ms. Hamilton under a deferred compensation plan
   for serving as a Trustee for MassMutual Institutional Funds and MML Series
   Investment Fund (until June 30, 2004).
6. Includes $49,000 compensation paid to Mr. Marshall for serving as a Trustee
   for MassMutual Select Funds and MML Series Investment Fund.

|X| Deferred Compensation Plan For Trustees. The Board of Trustees has adopted a
Deferred Compensation Plan for Independent Trustees that enables them to elect
to defer receipt of all or a portion of the annual fees they are entitled to
receive from the Funds. Under the plan, the compensation deferred by a Trustee
is periodically adjusted as though an equivalent amount had been invested in
shares of one or more Oppenheimer funds selected by the Trustee. The amount paid
to the Trustee under the plan will be determined based upon the amount of
compensation deferred and the performance of the selected funds.

      Deferral of Trustees' fees under the plan will not materially affect the
Funds' assets, liabilities or net income per share. The plan will not obligate
the Funds to retain the services of any Trustee or to pay any particular level
of compensation to any Trustee. Pursuant to an Order issued by the SEC, , the
Funds may invest in the funds selected by the Trustees under the plan without
shareholder approval for the limited purpose of determining the value of the
Trustees' deferred compensation account.

|X| Major Shareholders. As of March 31, 2005, the only persons or entities who
owned of record or were known by the Funds to own beneficially 5% or more of any
class of the Funds' outstanding shares were the Manager and the following
insurance companies and their respective affiliates, such shares were held as
shown in Appendix D:

(i)   Allianz Life Insurance Company of North America ("Allianz"), Minneapolis,
      MN;
(ii)  Allmerica Financial Life Insurance and Annuity Company ("Allmerica"),
      Worcester, MA;
(iii) Allstate Financial Advisors ("Allstate Financial"), Lincoln, NE; (iv)
      Allstate Life Insurance Company of New York ("Allstate NY"), Vernon
      Hills, IL;
(v) Allstate Life Insurance Company ("Allstate"), Vernon Hills, IL; (vi)
American Enterprise Life Insurance Company ("American Enterprise"),
      Minneapolis, MN;
(vii) American General Annuity Insurance Company ("American General"), Houston,
      TX;
(viii) Cuna Mutual Life Insurance Company ("CUNA"), Waverly, IA; (ix) First
      Security Benefit Life Insurance and Annuity Company of New York
      ("Security Benefit"), White Plains, NY; (x) GE Life and Annuity Assurance
Company ("GE"), Richmond, VA; (xi) IDS Life Insurance Company ("IDS Life"),
Minneapolis, MN; (xii) ING Life Insurance and Annuity Company ("ING"), Hartford,
CT; (xiii) Kemper Investors Life Insurance Company ("Kemper"), Schaumburg,
      IL;
(xiv) Lincoln Benefit Life Company ("Lincoln"), Lincoln, NE; (xv) Mass Mutual
Life Insurance Company ("MassMutual"), Springfield, MA; (xvi) Merrill Lynch,
Pierce, Fenner, & Smith, Inc. ("Merrill Lynch"),
      Jacksonville, FL;
(xvii) Minnesota Life Insurance Company ("Minnesota"), St. Paul, MN; (xviii)
Mony Life Insurance Company of America ("Mony"), New York, NY; (xix) Nationwide
Life Insurance Company ("Nationwide"), Columbus, OH; (xx) Protective Life
Insurance Company ("Protective"), Birmingham, AL; (xxi) Sage Life Assurance of
America ("Sage"), Wethersfield, CT; (xxii) Sun Life Assurance Company of Canada
(U.S.) ("Sun Life"),
      Wellesley Hills, MA; and
(xxiii) The Travelers Insurance Company ("Travelers"), Hartford, CT. Such shares
      were held as shown in Appendix D.

The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a
holding company controlled by Massachusetts Mutual Life Insurance Company, a
global, diversified insurance and financial services organization.

      |X| Code of Ethics. The Funds (except Money Fund/VA), the Manager and the
Distributor have a Code of Ethics. It is designed to detect and prevent improper
personal trading by certain employees, including portfolio managers that would
compete with or take advantage of the Funds' portfolio transactions. Covered
persons include persons with knowledge of the investments and investment
intentions of the Funds and other funds advised by the Manager. The Code of
Ethics does permit personnel subject to the Code to invest in securities,
including securities that may be purchased or held by the Funds, subject to a
number of restrictions and controls. Compliance with the Code of Ethics is
carefully monitored and enforced by the Manager.

      The Code of Ethics is an exhibit to the Funds' registration statement
filed with the SEC and can be reviewed and copied at the SEC's Public Reference
Room in Washington, D.C. You can obtain information about the hours of operation
of the Public Reference Room by calling the SEC at 1.202.942.8090. The Code of
Ethics can also be viewed as part of the Funds' registration statement on the
SEC's EDGAR database at the SEC's Internet website at www.sec.gov. Copies may be
obtained, after paying a duplicating fee, by electronic request at the following
E-mail address: publicinfo@sec.gov or by writing to the SEC's Public Reference
Section, Washington, D.C. 20549-0102.

|X| Portfolio Proxy Voting. The Funds (except Money Fund/VA) have adopted
Portfolio Proxy Voting Policies and Procedures under which the Funds votes
proxies relating to securities ("portfolio proxies") held by the Funds. The
Funds' primary consideration in voting portfolio proxies are the financial
interests of the Funds and their shareholders. The Funds have retained an
unaffiliated third-party as its agent to vote portfolio proxies in accordance
with the Funds' Portfolio Proxy Voting Guidelines and to maintain records of
such portfolio proxy voting. The Proxy Voting Guidelines include provisions to
address conflicts of interest that may arise between the Funds and the Manager
where a directly-controlled affiliate of the Manager manages or administers the
assets of a pension plan of a company soliciting the proxy. The Funds' Portfolio
Proxy Voting Guidelines on routine and non-routine proxy proposals are
summarized below.

o           The Funds vote with the recommendation of the issuer's management on
            routine matters, including election of directors nominated by
            management and ratification of the independent registered public
            accounting firm, unless circumstances indicate otherwise.
o           In general, the Funds oppose anti-takeover proposals and supports
            the elimination of anti-takeover proposals, absent unusual
            circumstances.
o           The Funds support shareholder proposals to reduce a super-majority
            vote requirement, and opposes management proposals to add a
            super-majority vote requirement.
o The Funds oppose proposals to classify the board of directors. o The Funds
support proposals to eliminate cumulative voting. o The Funds oppose re-pricing
of stock options. o The Funds generally consider executive compensation
questions such as
            stock option plans and bonus plans to be ordinary business activity.
            The Funds analyze stock option plans, paying particular attention to
            their dilutive effect. While the Funds generally support management
            proposals, the Fund opposes plans it considers to be excessive.

      The Funds are required to file new Form N-PX, with its complete proxy
voting record for the 12 months ended June 30th, no later than August 31st of
each year. The Funds' Form N-PX filing will be available (i) without charge,
upon request, by calling the Funds toll-free at 1.800.225.5677 and (ii) on the
SEC's website at www.sec.gov.

|X| The Investment Advisory Agreements. The Manager provides investment advisory
and management services to each Fund under an investment advisory agreement
between the Manager and the Trust for each Fund. The Manager selects securities
for the Funds' portfolios and handles their day-to-day business. The portfolio
managers of the Funds are employed by the Manager and are the persons who are
principally responsible for the day-to-day management of the Funds' portfolios.
Other members of the Manager's Teams provide the portfolio managers with counsel
and support in managing the Funds' portfolios. Similarly, other members of the
Manager's Fixed Income Portfolio Department, particularly portfolio analysts,
traders and other portfolio managers having broad experience with domestic and
international government and fixed-income securities, provide the portfolio
managers of the High Income Fund/VA, Core Bond Fund/VA and Strategic Bond
Fund/VA with support in managing the portfolios of those Funds.

      The agreements require the Manager, at its expense, to provide the Funds
with adequate office space, facilities and equipment. It also requires the
Manager to provide and supervise the activities of all administrative and
clerical personnel required to provide effective administration for the Funds.
Those responsibilities include the compilation and maintenance of records with
respect to its operations, the preparation and filing of specified reports, and
composition of proxy materials and registration statements for continuous public
sale of shares of the Funds.

    The Funds pay expenses not expressly assumed by the Manager under the
advisory agreements, or by the Distributor under the General Distributor's
Agreements for Service shares. The advisory agreement lists examples of expenses
paid by the Funds. The major categories relate to interest, taxes, brokerage
commissions, fees to certain Trustees, legal and audit expenses, custodian and
transfer agent expenses, share issuance costs, certain printing and registration
costs and non-recurring expenses, including litigation costs. The management
fees paid by the Funds to the Manager are calculated at the rates described in
the Prospectus, which are applied to the assets of each of the Funds as a whole.
Prior to May 1, 1999, the advisory agreement for Aggressive Growth Fund/VA did
not include a breakpoint above $800 million. Whenever more than one class of
shares is issued, the fees are allocated to each class of shares based upon the
relative proportion of a Fund's net assets represented by that class.

    The Agreements contain no expense limitation. However, from January 1, 2002
to December 17, 2002, the Manager had undertaken to voluntarily reduce the
management fee of Strategic Bond Fund/VA, if the relative performance of that
Fund was at or below the following criteria. If the trailing 12-month
performance of Strategic Bond Fund/VA at the end of any calendar quarter were
ranked by Lipper, Inc. ("Lipper") in the fifth quintile of the Lipper peer group
for that Fund (funds dedicated to variable insurance products in Lipper's
general bond funds category), the Manager had undertaken to reduce the
management fee for that Fund by 0.10% for the following fiscal quarter and for
each quarter thereafter until its performance improved, and if ranked in the
fourth quintile of that peer group, the Manager had undertaken to reduce the
management fee by 0.05% for the following fiscal quarter and for each quarter
thereafter until its performance improved.


- ------------------------------------------------------------------------------
            Management Fees for the Fiscal Year Ended December 31
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Fund                             2002             2003             2004
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Aggressive Growth Fund/VA     $8,292,465       $7,110,272       $7,692,943
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Balanced Fund/VA              $3,758,161       $3,526,680       $4,101,747
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Capital Appreciation          $10,670,415      $9,930,998       $12,193,670
Fund/VA
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Core Bond Fund/VA             $4,896,856       $4,954,407       $4,013,043
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Global Securities Fund/VA     $11,712,612      $12,206,333      $18,297,753
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
High Income Fund/VA           $2,518,441       $3,196,862       $4,058,869
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Main Street Fund(R)/VA          $7,045,796       $7,442,344       $9,708,725
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Main Street Small Cap          $170,358         $338,340        $1,070,988
Fund(R)/VA
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Money Fund/VA                 $1,738,866       $1,424,167        $982,603
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Strategic Bond Fund/VA       $2,771,643(2)     $3,673,166       $5,203,309
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Value Fund/VA                   N/A(1)           $23,894          $25,294
- ------------------------------------------------------------------------------
1. Shares of Value Fund/VA were not offered for sale during the periods shown.
2. The Manager voluntarily reimbursed $ 44,031 in management fees under the
   expense limitation described above. Management fees are shown in the table
   before reimbursement.

      The investment advisory agreements state that in the absence of willful
misfeasance, bad faith, gross negligence in the performance of its duties or
reckless disregard of its obligations and duties under the investment advisory
agreement, the Manager is not liable for any loss the Funds sustains for any
investment, adoption of any investment policy, or the purchase, sale or
retention of any security.

      The agreements permit the Manager to act as investment advisor for any
other person, firm or corporation and to use the name "Oppenheimer" in
connection with other investment companies for which it may act as investment
advisor or general distributor. If the Manager shall no longer act as investment
advisor to a Fund, the Manager may withdraw the right of that Fund to use the
name "Oppenheimer" as part of its name.

Portfolio Managers. Each Fund's portfolio is managed by the following:

Fund Name                  Portfolio Manager(s)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Aggressive Growth Fund/VA  John O'Hare
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Balanced Fund/VA           Emmanuel Ferreira, Christopher Leavy, Angelo
                           Manioudakis, Antulio Bomfim, Geoffrey Caan,
                           Benjamin J. Gord and Charles Moon
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Capital Appreciation       Marc L. Baylin, William Wilby
Fund/VA
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Core Bond Fund/VA          Angelo Manioudakis, Antulio Bomfim, Geoffrey Caan,
                           Benjamin J. Gord and Charles Moon
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Global Securities Fund/VA  William L. Wilby and Rajeev Bhaman
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
High Income Fund/VA        Dimitrios Kourkoulakos
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Main Street Fund(R)/VA       Nikolaos D. Monoyios and Marc Reinganum
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Main Street Small Cap      Nikolaos D. Monoyios and Mark Zavanelli
Fund(R)/VA
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Money Fund/VA              Barry D. Weiss and Carol E. Wolf
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Strategic Bond Fund/VA     Arthur P. Steinmetz
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Value Fund/VA              Christopher Leavy
- -------------------------------------------------------------------------------

      Each of the above individuals is referred to as "Portfolio Manager" and
collectively they are referred to as the "Portfolio Managers". They are the
persons who are responsible for the day-to-day management of each Fund's
respective investments.

|X| Other Accounts Managed. In addition to managing the Fund's investment
portfolio, Messrs. O'Hare, Ferreira, Leavy, Manioudakis, Bomfim, Caan, Gord,
Moon, Wilby, Bhaman, Kourkoulakos, Monoyios, Reinganum, Zavanelli, Baylin, Weiss
and Steinmetz and Ms. Wolf or each Portfolio Manager also manages other
investment portfolios and other accounts, all of them on behalf of the Manager
or its affiliates. The following table provides information regarding those
portfolios and accounts as of December 31, 2004, regarding the other portfolios
and accounts managed by a Portfolio Manager. Except for on registered investment
company managed by Messrs. Wilby and Bhaman no portfolio or account has a
performance-base advisory fee:

Fund Name and             RegisteredTotal      Other      Total    Other   Total
                                                        Assets in
                                    Assets in          nt Other            Assets
                                    Registered Pooled    Pooled            in
                          InvestmentInvestment InvestmeInvestment          Other
                          Companies Companies  Vehicles Vehicles   AccountsAccounts
Portfolio Managers         Managed   Managed*  Managed  Managed*   Managed Managed*
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Aggressive Growth Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
John O'Hare                   2      $2,315.1   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Balanced Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Emmanuel Ferreira             4       $3,345    None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Christopher Leavy            14      $7,195.1     1       $18.8     None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Angelo Manioudakis           16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Antulio Bomfim               16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Geoffrey Caan                16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Benjamin J. Gord             16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Charles Moon                 16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Capital Appreciation
Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Marc L. Baylin              None     None        None    None     None     None
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Core Bond Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Angelo Manioudakis           16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Antulio Bomfim               16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Geoffrey Caan                16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Benjamin J. Gord             16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Charles Moon                 16      $8,911.4     5      $152.9       1     $38.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
High Income Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Dimitrios Kourkoulakos        3      $4,065.7   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Main Street Fund(R)/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Nikolaos D. Monoyios         11      $2,415.7     1       $16.2     None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Marc Reinganum                8      $2,358.6   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Main Street Small Cap
Fund(R)/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Nikolaos D. Monoyios         11      $2,415.7     1       $16.2     None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Mark Zavanelli                3      $3,925.7   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Money Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Barry D. Weiss                6     $25,072.9   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Carol E. Wolf                 6     $25,072.9   None       $0       None     $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Strategic Bond Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Arthur P. Steinmetz           6     $10,131.2     3       $48.8       4    $1,140.9
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Value Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Christopher Leavy            14      $7,195.1     1       $18.8     None     $0
*In millions.
**In thousands.

                                   Registered     Other Pooled
      Fund Name and                Investment      Investment       Other
      Portfolio Managers            Companies       Vehicles      Accounts
      ------------------------------------------------------------------------
      Capital Appreciation Fund/VA
      Global Securities Fund/VA
      ------------------------------------------------------------------------
      William L. Wilby
      ------------------------------------------------------------------------
      ------------------------------------------------------------------------
      Accounts Managed                 15              1            None
      ------------------------------------------------------------------------
      ------------------------------------------------------------------------
      Total Assets Managed*         $19,335.9        $19.6           $0
      ------------------------------------------------------------------------
      ------------------------------------------------------------------------
      Accounts with                     1             None          None
      Performance-Based
      Advisory Fees
      ------------------------------------------------------------------------
      ------------------------------------------------------------------------
      Total Assets in Accounts       $189.2            $0            $0
      with Performance-Based
      Advisory Fees*
      ------------------------------------------------------------------------
      Rajeev Bhaman
      ------------------------------------------------------------------------
      Accounts Managed                 15              2            None
      ------------------------------------------------------------------------
      Total Assets Managed*         $19,335.9        $71.1           $0
      ------------------------------------------------------------------------
      Accounts with
      Performance-Based
      Advisory Fees                     1             None          None
      ------------------------------------------------------------------------
      ------------------------------------------------------------------------
      Total Assets in Accounts       $189.2            $0            $0
      with Performance-Based
      Advisory Fees*
      ------------------------------------------------------------------------
*In millions.

      As indicated above, each of the Portfolio Managers also manages other
funds and accounts. Potentially, at times, those responsibilities could conflict
with the interests of the Funds. That may occur whether the investment
strategies of the other funds or accounts are the same as, or different from,
the Funds' investment objectives and strategies. For example, a Portfolio
Manager may need to allocate investment opportunities between a Fund and another
fund or account having similar objectives or strategies, or a Portfolio Manager
may need to execute transactions for another fund or account that could have a
negative impact on the value of securities held by a Fund. Not all funds and
accounts advised by the Manager have the same management fee. If the management
fee structure of another fund or account is more advantageous to the Manager
than the fee structure of a Fund, the Manager could have an incentive to favor
the other fund or account. However, the Manager's compliance procedures and Code
of Ethics recognize the Manager's fiduciary obligations to treat all of its
clients, including the Funds, fairly and equitably, and are designed to preclude
the Portfolio Managers from favoring one client over another. It is possible, of
course, that those compliance procedures and the Code of Ethics may not always
be adequate to do so. At various times, the Funds' Portfolio Managers may manage
other funds or accounts with investment objectives and strategies that are
similar to those of the Funds, or may manage funds or accounts with investment
objectives and strategies that are different from those of the Funds.

|X| Compensation of the Portfolio Managers. The Funds' Portfolio Managers are
employed and compensated by the Manager, not the Fund. Under the Manager's
compensation program for its portfolio managers and portfolio analysts, their
compensation is based primarily on the investment performance results of the
funds and accounts they manage, rather than on the financial success of the
Manager. This is intended to align the portfolio managers and analysts'
interests with the success of the funds and accounts and their shareholders. The
Manager's compensation structure is designed to attract and retain highly
qualified investment management professionals and to reward individual and team
contributions toward creating shareholder value. As of December 31, 2004, each
Portfolio Managers' compensation consisted of three elements: a base salary, an
annual discretionary bonus and eligibility to participate in long-term awards of
options and appreciation rights in regard to the common stock of the Manager's
holding company parent. Senior portfolio managers may also be eligible to
participate in the Manager's deferred compensation plan.

      To help the Manager attract and retain talent, the base pay component of
each portfolio manager is reviewed regularly to ensure that it reflects the
performance of the individual, is commensurate with the requirements of the
particular portfolio, reflects any specific competence or specialty of the
individual manager, and is competitive with other comparable positions. The
annual discretionary bonus is determined by senior management of the Manager and
is based on a number of factors, including a fund's pre-tax performance for
periods of up to five years, measured against, an appropriate Lipper benchmark
selected by management. The Lipper benchmark with respect to each Fund is as
follows:

Fund Name                  Lipper Benchmark
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Aggressive Growth Fund/VA  Lipper Mid-Cap Growth Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Balanced Fund/VA           Lipper Mixed Equity - Balanced Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Capital Appreciation       Lipper U.S. Diversified Equity - Large-Cap Core
Fund/VA                    Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Core Bond Fund/VA          Lipper Short-Intermediate Corporate - Intermediate
                             Investment Grade Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Global Securities Fund/VA  Lipper Global Multi-Cap Growth Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
High Income Fund/VA        Lipper High Current Yield Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Main Street Fund(R)/VA       Lipper U.S. Diversified Equity - Large-Cap Core
                           Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Main Street Small Cap      Lipper U.S. Diversified Equity - Small-Cap Core
Fund(R)/VA                   Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Money Fund/VA              Lipper Money Market Instrument Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Strategic Bond Fund/VA     Lipper Multi-Sector Income Funds
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Value Fund/VA              Lipper U.S. Diversified Equity - Large-Cap Value
                           Funds
- -------------------------------------------------------------------------------

      Other factors include management quality (such as style consistency, risk
management, sector coverage, team leadership and coaching) and organizational
development. The Portfolio Managers' compensation is not based on the total
value of the Fund's portfolio assets, although the Fund's investment performance
may increase those assets. The compensation structure is also intended to be
internally equitable and serve to reduce potential conflicts of interest between
the Fund and other funds and accounts managed by the Portfolio Managers. Except
for one portfolio managed by Messrs. Wilby and Bhaman, the compensation
structure of the other funds and accounts managed by the Portfolio Managers is
the same as the compensation structure of the Fund, described above. A portion
of the Portfolio Managers' compensation with regard to that portfolio may, under
certain circumstances, include an amount based in part on the amount of the
fund`s management fee.

|X| Ownership of Fund Shares. As of December 31, 2004, the Portfolio Managers
did not beneficially own any shares of the Funds, which are sold only through
insurance companies to their contract owners.

Brokerage Policies of the Funds

Brokerage Provisions of the Investment Advisory Agreements. One of the duties of
the Manager under the investment advisory agreements is to arrange the portfolio
transactions for the Funds. The advisory agreements contain provisions relating
to the employment of broker-dealers to effect the Funds' portfolio transactions.
The Manager is authorized by the advisory agreements to employ broker-dealers,
including "affiliated" brokers, as that term is defined in the Investment
Company Act. The Manager may employ broker-dealers that the Manager thinks, in
its best judgment based on all relevant factors, will implement the policy of
the Funds to obtain, at reasonable expense, the "best execution" of the Funds'
portfolio transactions. "Best execution" means prompt and reliable execution at
the most favorable price obtainable. The Manager need not seek competitive
commission bidding. However, it is expected to be aware of the current rates of
eligible brokers and to minimize the commissions paid to the extent consistent
with the interests and policies of the Funds as established by its Board of
Trustees.

      Under the investment advisory agreements, in choosing brokers to execute
portfolio transactions for the Funds, the Manager may select brokers (other than
affiliates) that provide brokerage and/or research services to the Funds and/or
the other accounts over which the Manager or its affiliates have investment
discretion. The commissions paid to those brokers may be higher than another
qualified broker would charge, if the Manager makes a good faith determination
that the commission is fair and reasonable in relation to the services provided.

      Rule 12b-1 under the Investment Company Act prohibits any fund from
compensating a broker or dealer for promoting or selling the Funds' shares by
(1) directing to that broker or dealer any of the Funds' portfolio transactions,
or (2) directing any other remuneration to that broker or dealer, such as
commissions, mark-ups, mark downs or other fees from the Funds' portfolio
transactions, that were effected by another broker or dealer (these latter
arrangements are considered to be a type of "step-out" transaction). In other
words, a fund and its investment adviser cannot use the Funds' brokerage for the
purpose of rewarding broker-dealers for selling the Funds' shares.

      However, the Rule permits funds to effect brokerage transactions through
firms that also sell fund shares, provided that certain procedures are adopted
to prevent a quid pro quo with respect to portfolio brokerage allocations. As
permitted by the Rule, the Manager has adopted procedures (and the Funds' Board
of Trustees has approved those procedures) that permit the Funds to direct
portfolio securities transactions to brokers or dealers that also promote or
sell shares of the Funds, subject to the "best execution" considerations
discussed above. Those procedures are designed to prevent: (1) the Manager's
personnel who effect the Funds' portfolio transactions from taking into account
a broker's or dealer's promotion or sales of the Funds shares when allocating
the Funds' portfolio transactions, and (2) the Funds, the Manager and the
Distributor from entering into agreements or understandings under which the
Manager directs or is expected to direct the Funds' brokerage directly, or
through a "step-out" arrangement, to any broker or dealer in consideration of
that broker's or dealer's promotion or sale of the Funds' shares or the shares
of any of the other Oppenheimer funds.

Brokerage Practices Followed by the Manager. The Manager allocates brokerage for
the Funds subject to the provisions of the investment advisory agreements and
the procedures and rules described above. Generally, the Manager's portfolio
traders allocate brokerage based upon recommendations from the Manager's
portfolio managers. In certain instances, portfolio managers may directly place
trades and allocate brokerage. In either case, the Manager's executive officers
supervise the allocation of brokerage.

      Transactions in securities other than those for which an exchange is the
primary market are generally done with principals or market makers. In
transactions on foreign exchanges, the Funds may be required to pay fixed
brokerage commissions and therefore would not have the benefit of negotiated
commissions available in U.S. markets. Brokerage commissions are paid primarily
for transactions in listed securities or for certain fixed-income agency
transactions in the secondary market. Otherwise brokerage commissions are paid
only if it appears likely that a better price or execution can be obtained by
doing so. In an option transaction, the Funds ordinarily use the same broker for
the purchase or sale of the option and any transaction in the securities to
which the option relates.

      Other funds advised by the Manager have investment policies similar to
those of the Funds. Those other funds may purchase or sell the same securities
as the Funds at the same time as the Funds, which could affect the supply and
price of the securities. If two or more funds advised by the Manager purchase
the same security on the same day from the same dealer, the transactions under
those combined orders are averaged as to price and allocated in accordance with
the purchase or sale orders actually placed for each account.

      Most purchases of debt obligations are principal transactions at net
prices. This affects a substantial portion of the portfolio transactions of
Money Fund/VA, High Income Fund/VA, Core Bond Fund/VA and Strategic Bond
Fund/VA. Instead of using a broker for those transactions, the Funds normally
deal directly with the selling or purchasing principal or market maker unless
the Manager determines that a better price or execution can be obtained by using
the services of a broker. Purchases of portfolio securities from underwriters
include a commission or concession paid by the issuer to the underwriter.
Purchases from dealers include a spread between the bid and asked prices. The
Funds seek to obtain prompt execution of these orders at the most favorable net
price.

      The investment advisory agreements permit the Manager to allocate
brokerage for research services. The research services provided by a particular
broker may be useful only to one or more of the advisory accounts of the Manager
and its affiliates. The investment research received for the commissions of
those other accounts may be useful both to one of the Funds and one or more of
the Manager's other accounts. Investment research may be supplied to the Manager
by a third party at the instance of a broker through which trades are placed.

      Investment research services include information and analysis on
particular companies and industries as well as market or economic trends and
portfolio strategy, market quotations for portfolio evaluations, information
systems, computer hardware and similar products and services. If a research
service also assists the Manager in a non-research capacity (such as bookkeeping
or other administrative functions), then only the percentage or component that
provides assistance to the Manager in the investment decision-making process may
be paid in commission dollars.

      The Board of Trustees permits the Manager to use stated commissions on
secondary fixed-income agency trades to obtain research if the broker represents
to the Manager that: (i) the trade is not from or for the broker's own
inventory, (ii) the trade was executed by the broker on an agency basis at the
stated commission, and (iii) the trade is not a riskless principal transaction.
The Board of Trustees permits the Manager to use commissions on fixed-price
offerings to obtain research, in the same manner as is permitted for agency
transactions.

      The research services provided by brokers broaden the scope and supplement
the research activities of the Manager. That research provides additional views
and comparisons for consideration, and helps the Manager to obtain market
information for the valuation of securities that are either held in the Funds'
portfolio or are being considered for purchase. The Manager provides information
to the Board about the commissions paid to brokers furnishing such services,
together with the Manager's representation that the amount of such commissions
was reasonably related to the value or benefit of such services.

      The (i) total brokerage commissions paid by the Funds (other than Money
Fund/VA, which paid no brokerage commissions), not including spreads or
concessions on principal transactions on a net trade basis, for the Funds'
fiscal years ended December 31, 2002, 2003 and 2004; and (ii) for the Funds'
fiscal year ended December 31, 2004, the amount of transactions directed to
brokers for research services, and the amount of the commissions paid to
broker-dealers for those services, is shown in the chart below:

- -----------------------------------------------------------------------------------
                                                         Commissions  Transactions
                           Total Brokerage Commissions       Paid       Directed
                                Paid by the Funds            For          For
                                                         Research(2)  Research(2)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Fund                        2002       2003      2004        2004         2004
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Aggressive Growth Fund/VA $1,393,475$3,477,965 $1,221,917  $110,197   $100,551,439
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Balanced Fund/VA          $478,215   $827,890  $469,058    $47,905    $28,943,354
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Capital Appreciation      $1,335,268$2,183,642 $2,011,561  $166,712   $123,660,658
Fund/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Core Bond Fund/VA         $389,802   $84,234    $87,671       $0           $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Global Securities Fund/VA $2,699,449$2,836,950 $2,189,386  $242,077   $113,353,949
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
High Income Fund/VA        $4,865     $2,592    $1,548        $0           $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Main Street Fund(R)/VA      $2,349,576$1,722,472 $2,947,503  $128,377   $171,871,484
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Main Street Small Cap     $136,159   $214,694  $838,394    $17,346    $13,807,155
Fund(R)/VA
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Strategic Bond Fund/VA     $61,906   $63,992    $70,285       $0           $0
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Value Fund/VA              N/A(1)    $17,817    $8,813       $787       $586,814
- -----------------------------------------------------------------------------------
1. Shares of Value Fund/VA were not offered for sale during the period. 2. The
amount of transactions directed to brokers for research services
   and the amount of the commissions paid to brokers for those services are
   shown in these columns.

Distribution and Service Plans (Service Shares and Class 4 Shares)

The Distributor. Under its General Distributor's Agreement with each Fund,
OppenheimerFunds Distributor, Inc. ("OFDI" or the "Distributor") will act as
the principal underwriter for the Funds' Service shares and Class 4 shares
only.

      Each Fund has adopted a Distribution and Service Plan under Rule 12b-1 of
the Investment Company Act (a "Plan") for its Service shares and Class 4 shares,
although as of December 31, 2004, only Global Securities Fund/VA offered Class 4
shares. Each Fund that offers Service shares and/or Class 4 shares will make
compensation payments to the Distributor in connection with the distribution
and/or servicing of those shares. The Distributor will pay insurance company
separate account sponsors and other entities that offer and/or provide services
to Service shares and Class 4 shares, as described in the applicable Fund's
Prospectus. Each Plan has been approved by a vote of (i) the Board of Trustees
of the Trust, including a majority of the Independent Trustees, cast in person
at a meeting called for the purpose of voting on that Plan, and (ii) the Manager
as the then-sole initial holder of such shares.

      Under the Plans, the Funds currently use the fees it receives to pay
insurance company separate account sponsors or their affiliates (each is
referred to as a "Recipient") for personal services and account maintenance
services they provide for their customers who hold Service and Class 4 shares.
The services include, among others, answering customer inquiries about the
Funds, assisting in establishing and maintaining accounts in the Funds, and
providing other services at the request of a Fund.

      Under the Plans, no payment will be made to any Recipient in any quarter
if the aggregate net assets of a Fund's Service and Class 4 shares held by the
Recipient for itself and its customers did not exceed a minimum amount, if any,
that may be determined from time to time by a majority of the Trust's
Independent Trustees. The Plans provide for a fee of 0.25% of average annual net
assets (although the Board of Trustees had set the fee at 0.15% of average net
assets for all series prior to May 1, 2003). As of December 31, 2004, the Board
had set no minimum asset amount. For the fiscal year ended December 31, 2004,
all payments made under the Service share Plan were paid by the Distributor, to
Recipients (including Recipients affiliated with the Manager).

      The Service shares class payments during the fiscal year ended December
31, 2004, for all Funds having Service shares outstanding as of that date, were
as follows:

- --------------------------------------------------------------------------
                    Fund                       Service Plan Payments by
                                                         OFDI
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Aggressive Growth Fund/VA                   $43,863
Service Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Balanced Fund/VA Service Shares             $99,391
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Capital Appreciation Fund/VA               $459,798
Service Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Core Bond Fund/VA Service Shares            $7,476
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Global Securities Fund/VA                  $617,506
Service Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Global Securities Fund/VA Class 4           $32,566
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer High Income Fund/VA Service                $253,266
Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Main Street Fund(R) /VA Service              $655,239
Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Main Street Small Cap Fund(R)/VA             $279,935
Service Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
Oppenheimer Strategic Bond Fund/VA Service             $373,995
Shares
- --------------------------------------------------------------------------

      Under the Plans, the Manager and the Distributor may make payments to
affiliates. In their sole discretion, they may also from time to time make
substantial payments from their own resources, which include the profits the
Manager derives from the advisory fees it receives from the Funds, to compensate
financial intermediaries that provide distribution assistance and/or
administrative services or that otherwise promote sales of the Funds' shares.
These payments, some of which may be referred to as "revenue sharing," may
relate to the Funds' inclusion on a financial intermediary's preferred list of
funds offered to its clients.

      Unless terminated as described below, each Plan continues in effect from
year to year but only as long as such continuance is specifically approved at
least annually by the Trust's Board of Trustees and by its Independent Trustees
by a vote cast in person at a meeting called for the purpose of voting on such
continuance. Any Plan may be terminated at any time by the vote of a majority of
the Independent Trustees or by the vote of the shareholders of a "majority" (as
defined in the Investment Company Act) of the outstanding Service shares or
Class 4 shares. Contract owners are considered to be shareholders of a Fund's
shares for purposes of voting with respect to the Plans. No Plan may be amended
to increase materially the amount of payments to be made unless such amendment
is approved by contract owners of the class affected by the amendment. All
material amendments must be approved by the Board and by a majority of the
Independent Trustees.

      While the plans are in effect and Service shares and/or Class 4 shares are
outstanding, the Treasurer of the Trust must provide separate written reports to
the Trust's Board of Trustees at least quarterly describing the amount of
payments and the purpose of the payment made pursuant to each Plan. These
reports are subject to the review and approval of the Independent Trustees.

Payments to Fund Intermediaries

Financial intermediaries may receive various forms of compensation or
reimbursement from the Fund in the form of 12b-1 plan payments as described in
the preceding section of this Statement of Additional Information. They may also
receive reallowance of commissions from the Distributor, derived from sales
charges paid by the clients of the financial intermediary, also as described in
this Statement of Additional Information. Additionally, the Manager and/or the
Distributor (including their affiliates) may make payments to financial
intermediaries in connection with their offering and selling shares of the Fund
and other Oppenheimer funds, providing marketing or promotional support,
transaction processing and/or administrative services. Among the financial
intermediaries that may receive these payments are brokers and dealers who sell
and/or hold shares of the Fund, banks (including bank trust departments),
registered investment advisers, insurance companies, retirement plan and
qualified tuition program administrators, third party administrators, and other
institutions that have selling, servicing or similar arrangements with the
Manager or Distributor. The payments to intermediaries vary by the types of
product sold, the features of the Fund share class and the role played by the
intermediary.

      Possible types of payments to financial intermediaries include, without
limitation, those discussed below.

o        Payments made by the Fund, or by an investor buying or selling shares
         of the Fund may include:

o             depending on the share class that the investor selects, contingent
              deferred sales charges or initial front-end sales charges, all or
              a portion of which front-end sales charges are payable by the
              Distributor to financial intermediaries as sales commissions (see
              "About Your Account" in the Prospectus);
o             ongoing asset-based payments attributable to the share class
              selected, including fees payable under the Fund's distribution
              and/or service plans adopted under Rule 12b-1 under the Investment
              Company Act, which are paid from the Fund's assets and allocated
              to the class of shares to which the plan relates (see "About the
              Fund -- Distribution and Service Plans" above);
o             shareholder servicing payments for providing omnibus accounting,
              recordkeeping, networking, sub-transfer agency or other
              administrative or shareholder services, including retirement plan
              and 529 plan administrative services fees, which are paid from the
              assets of a Fund as reimbursement to the Manager or Distributor
              for expenses they incur on behalf of the Fund.

o        Payments made by the Manager or Distributor out of their respective
         resources and assets, which may include profits the Manager derives
         from investment advisory fees paid by the Fund. These payments are made
         at the discretion of the Manager and/or the Distributor. These
         payments, often referred to as "revenue sharing" payments, may be in
         addition to the payments by the Fund listed above.

o             These types of payments may reflect compensation for marketing
              support, support provided in offering the Fund or other
              Oppenheimer funds through certain trading platforms and programs,
              transaction processing or other services;
o             The Manager and Distributor each may also pay other compensation
              to the extent the payment is not prohibited by law or by any
              self-regulatory agency, such as the NASD. Payments are made based
              on the guidelines established by the Manager and Distributor,
              subject to applicable law.

      These payments may provide an incentive to financial intermediaries to
actively market or promote the sale of shares of the Fund or other Oppenheimer
funds, or to support the marketing or promotional efforts of the Distributor in
offering shares of the Fund or other Oppenheimer funds. In addition, some types
of payments may provide a financial intermediary with an incentive to recommend
the Fund or a particular share class. Financial intermediaries may earn profits
on these payments, since the amount of the payment may exceed the cost of
providing the service. Certain of these payments are subject to limitations
under applicable law. Financial intermediaries may categorize and disclose these
arrangements to their clients and to members of the public in a manner different
from the disclosures in the Fund's prospectus and this Statement of Additional
Information. You should ask your financial intermediary for information about
any payments it receives from the Fund, the Manager or the Distributor and any
services it provides, as well as the fees and commissions it charges.

      Although brokers or dealers that sell Fund shares may also act as a broker
or dealer in connection with the execution of the purchase or sale of portfolio
securities by the Fund or other Oppenheimer funds, a financial intermediary's
sales of shares of the Fund or such other Oppenheimer funds is not a
consideration for the Manager when choosing brokers or dealers to effect
portfolio transactions for the Fund or such other Oppenheimer funds.

      Revenue sharing payments can pay for distribution-related or asset
retention items including, without limitation,

o        transactional support, one-time charges for setting up access for the
         Fund or other Oppenheimer funds on particular trading systems, and
         paying the intermediary's networking fees;
o        program support, such as expenses related to including the Oppenheimer
         funds in retirement plans, college savings plans, fee-based advisory or
         wrap fee programs, fund "supermarkets", bank or trust company products
         or insurance companies' variable annuity or variable life insurance
         products;
o        placement on the dealer's list of offered funds and providing
         representatives of the Distributor with access to a financial
         intermediary's sales meetings, sales representatives and management
         representatives.

      Additionally, the Manager or Distributor may make payments for firm
support, such as business planning assistance, advertising, and educating a
financial intermediary's sales personnel about the Oppenheimer funds and
shareholder financial planning needs.

      For the year ended December 31, 2004, the following financial
intermediaries that are broker-dealers offering shares of the Oppenheimer funds,
and/or their respective affiliates, received revenue sharing or similar
distribution-related payments from the Manager or Distributor for marketing or
program support:

  ADVEST INC.                             AEGON
  A.G. Edwards & Sons, Inc                AIG Network
  Allianz Life Insurance Company          Allstate Life Insurance Company
  Ameritas Life Insurance Corporation     American Centurian Life Insurance
  American Enterprise Life Insurance      American Express Financial Advisors
                                          Inc.
  American Portfolios                     Annuity Investors Life
  AXA Advisors                            Banc One Securities Corporation
  Bank of New York                        Cadaret Grant & Co. Inc.
  Charter One Securities Inc.             Chase Investment Services
  Citigroup Financial Network             CitiStreet
  Citizens Bank of Rhode Island           CJM Planning Corp.
  Columbus Life Insurance Company         Commonwealth Financial Network
  CUNA Brokerage Services Inc.            CUSO Financial Services, L.P.
  Federal Kemper                          First Allied Securities Inc
  First Global Capital                    GE Financial Assurance
  GlenBrook Life and Annuity Co.          Great West Life & Annuity Co., Inc.
  HD Vest                                 Hewitt Associates
  HSBC Brokerage (USA) Inc.               ING Network
  Jefferson Pilot Securities Corporation  John Hancock Variable Life Insurance
                                          Company
  Kemper Life Assurance Company           Legend Equities Corporation
  Legg Mason Wood Walker, Incorporated    Lincoln National Life Insurance
                                          Company
  Lincoln Financial Advisors Corporation  Lincoln Investment Planning
  Linsco/Private Ledger Corp.             MassMutual Financial Group and
                                          affiliates
  McDonald Investments, Inc.              Merrill Lynch & Co., Inc. and
                                          affiliates
  Metlife and affiliates                  Minnesota Life Insurance Company
  Morgan Stanley DW Inc.                  NPH Network
  Nationwide and affiliates               New York Life Securities, LLC
  PacLife Network                         Park Avenue Securities LLC
  Planmember Securities Corporation       Prime Capital Services, Inc.
  Princor Financial Services Corporation  Protective Life Insurance Co.
  Provident Mutual Insurance Company      Prudential Investment Management
                                          Services LLC
  Raymond James Financial Services, Inc.  Raymond James & Associates, Inc.
  RBC Dain Rauscher Inc.                  Securities America, Inc.
  Security Benefit Life Insurance Company Signator Investments
  Sun Life Insurance Company              Suntrust Investment Services, Inc.
  Tower Square Securities, Inc            Travelers Life & Annuity Co., Inc.
  UBS Financial Services Inc.             Union Central Life Insurance Company
  Wachovia Securities LLC                 Wells Fargo Investments, LLC

      For the year ended December 31, 2004, the following firms, which in some
cases are broker-dealers, received payments from the Manager or Distributor for
administrative or other services provided (other than revenue sharing
arrangements), as described above:

  ABN AMRO                                ADP
  Alliance Benefit Group                  AMVESCAP Retirement Plans
  American Stock & Transfer               Baden Retirement
  BCG                                     Benefit Administration Co., LLC
  Benefit Administration, Inc.            Benefit Plans Administrative Services
  Benetech, Inc.                          BISYS Retirement Services
  Boston Financial Data Services          Ceridian
  Circle Trust Company                    Citigroup
  CitiStreet                              CPI
  Daily Access.Com, Inc.                  Digital Retirement Solutions
  Dyatech                                 ERISA Administrative Services, Inc.
  ExpertPlan.com                          FAScore
  FBD Consulting                          Federated Investors
  Fidelity Institutional                  First National Bank of Omaha
  First Trust Corp.                       Franklin Templeton
  Geller Group                            Gold K
  Great West Financial Services           Hartford Life Insurance Co.
  Equities, Inc.
  ICMA - RC Services                      In West Pension Mgmt
  Independent Plan Coordinators           Ingham Group
  Interactive Retirement Systems, Ltd.    Invesmart, Inc.
  Kaufman & Goble                         Leggette & Co., Inc.
  Manulife                                MassMutual Financial Group and
                                          affiliates
  Matrix Settlement & Clearance Services  Mellon HR Solutions
  Merrill Lynch & Co., Inc.               Metavante
  Metlife Securities Inc.                 MFS Investment Management
  Mid Atlantic Capital Corp.              Milliman USA
  Morgan Stanley DW Inc.                  National City Bank
  National Financial Services Corp.       National Investors Services Corp.
  Nationwide Investment Service Corp.     New York Life Investment Management,
                                          Inc.
  Northwest Plan Services                 Pension Administration and Consulting
  PFPC, Inc.                              PSMI Group
  Putnam Fiduciary Trust Company          Quads Trust Company
  RSM McGladrey                           SAFECO
  Charles Schwab & Co., Inc.              Security Trust Company
  Sentinel / National Life                Standard Insurance Co
  Stanley, Hunt, Dupree & Rhine           State Street Bank & Trust Company
  Suntrust Investment Services, Inc.      Swerdlin & Co.
  T. Rowe Price Brokerage Services, L.P.  Taylor, Perky & Parker, LLC
  The 401k Company                        The Investment Center, Inc.
  Trusource                               Union Bank and Trust Co.
  USI Consulting Group                    Vanguard Group
  Web401K.com                             Wilmington Trust Company

Performance of the Funds

Explanation of Performance Terminology. The Funds use a variety of terms to
illustrate their investment performance. Those terms include "cumulative total
return," "average annual total return," "average annual total return at net
asset value" and "total return at net asset value." An explanation of how total
returns are calculated is set forth below. The charts below show the Funds'
performance as of the Funds' most recent fiscal year end. You can obtain current
performance information by calling the Funds' Transfer Agent at 1.800.981.2871
or by visiting the Oppenheimerfunds Internet website at
www.oppenheimerfunds.com.

      The Funds' illustrations of their performance data in advertisements must
comply with rules of the SEC. Those rules describe the types of performance data
that may be used and how it is to be calculated. In general, any advertisement
by a Fund of its performance data must include the average annual total returns
for the advertised class of shares of that Fund.

      Use of standardized performance calculations enables an investor to
compare the Funds' performance to the performance of other funds for the same
periods. However, a number of factors should be considered before using the
Funds' performance information as a basis for comparison with other investments:
o        Yields and total returns measure the performance of a hypothetical
         account in a Fund over various periods and do not show the performance
         of each shareholder's account. Your account's performance will vary
         from the model performance data if your dividends are received in cash,
         or you buy or sell shares during the period, or you bought your shares
         at a different time and price than the shares used in the model.
o     The Funds' performance does not reflect the charges deducted from an
         investor's separate account by the insurance company or other
         sponsor of that separate account, which vary from product to
         product. If these charges were deducted, performance will be lower
         than as described in the Funds' Prospectus and Statement of
         Additional Information. In addition, the separate accounts may have
         inception dates different from those of the Funds. The sponsor for
         your insurance product can provide performance information that
         reflects those charges and inception dates.
o        The Funds' performance returns may not reflect the effect of taxes on
         dividends and capital gains distributions.
o        An investment in the Funds is not insured by the FDIC or any other
         government agency.
o        The principal value of the Funds' shares, its yields and total returns
         are not guaranteed and normally will fluctuate on a daily basis.
o        The preceding statement does not apply to Money Fund/VA, which seeks to
         maintain a stable net asset value of $1.00 per share. There can be no
         assurance that Money Fund/VA will be able to do so.
o        When an investor's shares are redeemed, they may be worth more or less
         than their original cost.
o        Yields and total returns for any given past period represent historical
         performance information and are not, and should not be considered, a
         prediction of future yields or returns.

      The performance of each class of shares is shown separately, because the
performance of each class of shares will usually be different. That is because
of the different kinds of expenses each class bears. The yields and total
returns of each class of shares of the Funds are affected by market conditions,
the quality of that Fund's investments, the maturity of debt investments, the
types of investments that Fund holds, and its operating expenses that are
allocated to the particular class.

      |X| Yields. The Funds use a variety of different yields to illustrate its
current returns. Each class of shares calculates its yield separately because of
the different expenses that affect each class.

o Standardized Yield. The "standardized yield" (sometimes referred to just as
"yield") is shown for a class of shares for a stated 30-day period. It is not
based on actual distributions paid by the Fixed Income Funds to shareholders in
the 30-day period, but is a hypothetical yield based upon the net investment
income from the Funds' portfolio investments for that period. It may therefore
differ from the "dividend yield" for the same class of shares, described below.

- ------------------------------------------------------------------------------
                                [OBJECT OMITTED]
- ------------------------------------------------------------------------------
      Standardized yield is calculated using the following formula set forth in
rules adopted by the SEC, designed to assure uniformity in the way that all
funds calculate their yields:

      The symbols above represent the following factors:
      a =  dividends and interest earned during the 30-day period.
      b =  expenses accrued for the period (net of any expense assumptions).
      c =  the  average  daily  number  of shares  of that  class  outstanding
           during the 30-day period that were entitled to receive dividends.
      d =  the maximum  offering price per share of that class on the last day
           of the period, adjusted for undistributed net investment income.

      The standardized yield for a particular 30-day period may differ from the
yield for other periods. The SEC formula assumes that the standardized yield for
a 30-day period occurs at a constant rate for a six-month period and is
annualized at the end of the six-month period. Additionally, because each class
of shares is subject to different expenses, it is likely that the standardized
yields of the Funds' classes of shares will differ for any 30-day period.

o Dividend Yield. The Fixed Income Funds may quote a "dividend yield" for each
class of its shares. Dividend yield is based on the dividends paid on a class of
shares during the actual dividend period. To calculate dividend yield, the
dividends of a class declared during a stated period are added together, and the
sum is multiplied by 12 (to annualize the yield) and divided by the maximum
offering price on the last day of the dividend period. Because the Fixed Income
Funds pay their annual dividend in March of each year, dividend yield is shown
for the 30 days ended March 31, 2005. The formula is shown below:

Dividend Yield = Distribution Paid / No. of Days in the Period x No. of Days
in the Calendar Year
                      Maximum Offering Price (payment date)

- ----------------------------------------------------------------------------
                      Standardized Yield for the   Dividend Yield for the
       Funds                    30-Day                     30-Day
                        Period Ended 12/31/04       Period Ended 3/31/05
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
Core Bond Fund/VA
Non-Service Shares              3.91%                       4.76%
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
Core Bond Fund/VA
Service Shares                  3.63%                       4.49%
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
High Income Fund/VA
Non-Service Shares              5.49%                       6.62%
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
High Income Fund/VA
Service Shares                  5.24%                       6.51%
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
Strategic Bond
Fund/VA                         3.95%                       5.34%
Non-Service Shares
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
Strategic Bond
Fund/VA                         3.77%                       5.14%
Service Shares
- ----------------------------------------------------------------------------

o Money Fund/VA Yields. The current yield for Money Fund/VA is calculated for a
seven-day period of time as follows. First, a base period return is calculated
for the seven-day period by determining the net change in the value of a
hypothetical pre-existing account having one share at the beginning of the
seven-day period. The change includes dividends declared on the original share
and dividends declared on any shares purchased with dividends on that share, but
such dividends are adjusted to exclude any realized or unrealized capital gains
or losses affecting the dividends declared. Next, the base period return is
multiplied by 365/7 to obtain the current yield to the nearest hundredth of one
percent.

      The compounded effective yield for a seven-day period is calculated by (1)
      adding 1 to the base period return (obtained as described above), (2)
      raising the sum to a power equal to 365 divided by 7, and (3) subtracting
      1 from the result.

      The yield as calculated above may vary for accounts less than
approximately $100 in value due to the effect of rounding off each daily
dividend to the nearest full cent. The calculation of yield under either
procedure described above does not take into consideration any realized or
unrealized gains or losses on the Funds' portfolio securities which may affect
dividends. Therefore, the return on dividends declared during a period may not
be the same on an annualized basis as the yield for that period.

      |X| Total Return Information. There are different types of "total returns"
to measure the Funds' performance. Total return is the change in value of a
hypothetical investment in a Fund over a given period, assuming that all
dividends and capital gains distributions are reinvested in additional shares
and that the investment is redeemed at the end of the period. Because of
differences in expenses for each class of shares, the total returns for each
class are separately measured. The cumulative total return measures the change
in value over the entire period (for example, ten years). An average annual
total return shows the average rate of return for each year in a period that
would produce the cumulative total return over the entire period. However,
average annual total returns do not show actual year-by-year performance. Each
Fund uses standardized calculations for its total returns as prescribed by the
SEC. The methodology is discussed below.

o Average Annual Total Return. The "average annual total return" of each class
is an average annual compounded rate of return for each year in a specified
number of years. It is the rate of return based on the change in value of a
hypothetical initial investment of $1,000 ("P" in the formula below) held for a
number of years ("n" in the formula) to achieve an Ending Redeemable Value
("ERV" in the formula) of that investment, according to the following formula:

- ------------------------------------------------------------------------------
                                [OBJECT OMITTED]
- ------------------------------------------------------------------------------

o Cumulative Total Return. The "cumulative total return" calculation measures
the change in value of a hypothetical investment of $1,000 over an entire period
of years. Its calculation uses some of the same factors as average annual total
return, but it does not average the rate of return on an annual basis.
Cumulative total return is determined as follows:

- ------------------------------------------------------------------------------
                                [OBJECT OMITTED]
- ------------------------------------------------------------------------------

- ---------------------------------------------------------------------------
         The Funds' Total Returns for the Periods Ended 12/31/04
- ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                                Fund and Class/Inception       1 Year         5 Years        10 Years
                                                          Date                                  (or            (or

life-of-class) life-of-class)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Aggressive Growth Fund/VA        19.78%         -7.90%          9.30%
                                              Non-Service Shares (8/15/86)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Aggressive Growth Fund/VA        19.43%         -13.77%          N/A
                                              Service Shares (10/16/00)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Balanced Fund/VA                 10.10%          6.05%          10.14%
                                              Non-Service Shares(2/9/87)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Balanced Fund/VA                 9.79%           8.39%           N/A
                                              Service Shares (5/1/02)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Capital Appreciation Fund/VA     6.93%          -2.23%          13.02%
                                              Non-Service Shares (4/3/85)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Capital Appreciation Fund/VA     6.62%           4.99%           N/A
                                              Service Shares (9/18/01)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Core Bond Fund/VA                5.49%           7.03%          7.06%
                                              Non-Service Shares (4/3/85)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Core Bond Fund/VA                5.22%           7.45%           N/A
                                              Service Shares (5/1/02)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Global Securities Fund/VA        19.16%          4.17%          12.58%
                                              Non-Service Shares
                                              (11/12/90)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Global Securities Fund/VA        18.88%          1.62%           N/A
                                              Service Shares (7/13/00)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Global Securities Fund/VA        19.19%         38.01%           N/A
                                              Class 3 shares (5/1/03)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Global Securities Fund/VA        N/A(1)         N/A(1)          N/A(1)
                                              Class 4 shares (5/3/04)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              High Income Fund/VA              8.97%           5.29%          7.74%
                                              Non-Service Shares (4/30/86)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              High Income Fund/VA              8.73%           9.11%           N/A
                                              Service Shares (9/18/01)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Main Street Fund(R)/VA             9.46%          -1.59%          10.53%
                                              Non-Service Shares (7/5/95)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Main Street Fund(R)/VA             9.15%          -2.66%           N/A
                                              Service Shares (7/13/00)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Main Street Small Cap
                                              Fund(R)/VA                         19.42%          3.40%          7.93%
                                              Non-Service Shares (5/1/98)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Main Street Small Cap
                                              Fund(R)/VA                         19.18%         12.55%           N/A
                                              Service Shares (7/16/01)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Money Fund/VA (4/3/85)           0.98%           2.65%          3.94%
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Strategic Bond Fund/VA           8.67%           8.21%          8.23%
                                              Non-Service Shares (5/3/93)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Strategic Bond Fund/VA           8.43%           9.01%           N/A
                                              Service Shares (3/19/01)
                                              ---------------------------------------------------------------------------
                                              ---------------------------------------------------------------------------
                                              Value Fund                       14.50%         21.57%           N/A
                                              Non-Service Shares (1/2/03)
                                              ---------------------------------------------------------------------------

1. Because Class 4 shares of Global Securities Fund/VA were not offered for
   sales during the full calendar year ended December 31, 2004, no performance
   information is included in the table above for Class 4 shares.

Other Performance Comparisons. The Funds compare their performance annually to
that of an appropriate broadly-based market index in its Annual Report to
shareholders. You can obtain that information by contacting the Transfer Agent
at the addresses or telephone numbers shown on the cover of this Statement of
Additional Information. The Funds may also compare their performance to that of
other investments, including other mutual funds, or use rankings of its
performance by independent ranking entities. Examples of these performance
comparisons are set forth below.

      |X| Lipper Rankings. From time to time the Funds may publish the rankings
of their performance of each classes of shares by Lipper, Inc. ("Lipper").
Lipper is a widely-recognized independent mutual fund monitoring service. Lipper
monitors the performance of regulated investment companies, including the Funds,
and ranks their performance for various periods in categories based on
investment styles. The Lipper performance rankings are based on total returns
that include the reinvestment of capital gain distributions and income dividends
but do not take sales charges or taxes into consideration. Lipper also publishes
"peer-group" indices of the performance of all mutual funds in a category that
it monitors and averages of the performance of the Funds in particular
categories.

      |X| Performance Rankings and Comparisons by Other Entities and
Publications. From time to time the Funds may include in advertisements and
sales literature performance information about the Funds cited in newspapers and
other periodicals such as The New York Times, The Wall Street Journal, Barron's,
or similar publications. That information may include performance quotations
from other sources, including Lipper and Morningstar. The Funds' performance may
be compared in publications to the performance of various market indices or
other investments, and averages, performance rankings or other benchmarks
prepared by recognized mutual fund statistical services.

      Investors may also wish to compare the returns on the Funds' shares
classes to the return on fixed-income investments available from banks and
thrift institutions. Those include certificates of deposit, ordinary
interest-paying checking and savings accounts, and other forms of fixed or
variable time deposits, and various other instruments such as Treasury bills.
However, the Funds' returns and share price are not guaranteed or insured by the
FDIC or any other agency and will fluctuate daily, while bank depository
obligations may be insured by the FDIC and may provide fixed rates of return.
Repayment of principal and payment of interest on Treasury securities is backed
by the full faith and credit of the U.S. government.

      From time to time, the Funds may publish rankings or ratings of the
Manager or Transfer Agent, and of the investor services provided by them to
shareholders of the Oppenheimer funds, other than performance rankings of the
Oppenheimer funds themselves. Those ratings or rankings of shareholder and
investor services by third parties may include comparisons of their services to
those provided by other mutual fund families selected by the rating or ranking
services. They may be based upon the opinions of the rating or ranking service
itself, using its research or judgment, or based upon surveys of investors,
brokers, insurance sponsors, shareholders or others.

      From time to time the Funds may include in its advertisements and sales
literature the total return performance of a hypothetical investment account
that includes shares of the Funds and other Oppenheimer funds. The combined
account may be part of an illustration of an asset allocation model or similar
presentation. The account performance may combine total return performance of
the Funds and the total return performance of other Oppenheimer funds included
in the account. Additionally, from time to time, the funds advertisements and
sales literature may include, for illustrative or comparative purposes,
statistical data or other information about general or specific market and
economic conditions. That may include, for example, o information about the
performance of certain securities or commodities
            markets or segments of those markets,
o     information about the performance of the economies of particular
            countries or regions,
o     the earnings of companies included in segments of particular
            industries, sectors, securities markets, countries or regions,
o     the availability of different types of securities or offerings of
            securities,
o     information relating to the gross national or gross domestic product of
            the United States or other countries or regions,
o     comparisons of various market sectors or indices to demonstrate
            performance, risk, or other characteristics of the Funds.

ABOUT YOUR ACCOUNT

How to Buy and Sell Shares

      Shares of the Funds are sold to provide benefits under variable life
insurance policies and variable annuity and other insurance company separate
accounts, as explained in the Prospectuses of the Funds and of the insurance
product you have selected. Instructions from an investor to buy or sell shares
of a Fund should be directed to the insurance sponsor for the investor's
separate account, or that insurance sponsor's agent.

|X| Allocation of Expenses. Each Fund pays expenses related to its daily
operations, such as custodian fees, Trustees' fees, transfer agency fees, legal
fees and auditing costs. Those expenses are paid out of each Fund's assets and
are not paid directly by shareholders. However, those expenses reduce the net
asset values of shares, and therefore are indirectly borne by shareholders
through their investment.

      The methodology for calculating the net asset value, dividends and
distributions of the Fund's share classes recognizes two types of expenses.
General expenses that do not pertain specifically to any one class are allocated
pro rata to the shares of all classes. The allocation is based on the percentage
of a Fund's total assets that is represented by the assets of each class, and
then equally to each outstanding share within a given class. Such general
expenses include management fees, legal, bookkeeping and audit fees, printing
and mailing costs of shareholder reports, Prospectuses, Statements of Additional
Information and other materials for current shareholders, fees to unaffiliated
Trustees, custodian expenses, share issuance costs, organization and start-up
costs, interest, taxes and brokerage commissions, and non-recurring expenses,
such as litigation costs.

      Other expenses that are directly attributable to a particular class are
allocated equally to each outstanding share within that class. Examples of such
expenses include distribution and service plan (12b-1) fees, transfer and
shareholder servicing agent fees and expenses, and shareholder meeting expenses
(to the extent that such expenses pertain only to a specific class).

Determination of Net Asset Values Per Share. The net asset values per share of
each class of shares of the Funds are determined as of the close of business of
the NYSE on each day that the NYSE is open. The calculation is done by dividing
the value of a Fund's net assets attributable to a class by the number of shares
of that class that are outstanding. The NYSE normally closes at 4:00 p.m.,
Eastern time, but may close earlier on some other days (for example, in case of
weather emergencies or on days falling before a U.S. holiday). All references to
time in this Statement of Additional Information mean "Eastern time." The NYSE's
most recent annual announcement (which is subject to change) states that it will
close on New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day. It may also close on other days.

      Dealers other than NYSE members may conduct trading in certain securities
on days on which the NYSE is closed (including weekends and holidays) or after
4:00 p.m. on a regular business day. Because the Funds' net asset values will
not be calculated on those days, the Funds' net asset values per share may be
significantly affected on such days when shareholders may not purchase or redeem
shares. Additionally, trading on European and Asian stock exchanges and
over-the-counter markets normally is completed before the close of the NYSE.

      Changes in the values of securities traded on foreign exchanges or markets
as a result of events that occur after the prices of those securities are
determined, but before the close of the NYSE, will not be reflected in the
Funds' calculation of its net asset values that day unless the Manager
determines that the event is likely to effect a material change in the value of
the security. The Manager, or an internal valuation committee established by the
Manager, as applicable, may establish a valuation, under procedures established
by the Board and subject to the approval, ratification and confirmation by the
Board at its next ensuing meeting.

|X| Securities Valuation. The Funds' Board of Trustees has established
procedures for the valuation of those Funds' securities. In general the
procedures for all Funds other than Money Fund/VA are as follows:

o     Equity securities traded on a U.S. securities exchange or on NASDAQ(R)
are valued as follows:
(1)   if last sale information is regularly reported, they are valued at the
               last reported sale price on the principal exchange on which
               they are traded or on NASDAQ(R), as applicable, on that day, or
(2)            if last sale information is not available on a valuation date,
               they are valued at the last reported sale price preceding the
               valuation date if it is within the spread of the closing "bid"
               and "asked" prices on the valuation date or, if not, at the
               closing "bid" price on the valuation date.

o Equity securities traded on a foreign securities exchange generally are valued
in one of the following ways: (1) at the last sale price available to the
pricing service approved by the
               Board of Trustees, or
(2)            at the last sale price obtained by the Manager from the report of
               the principal exchange on which the security is traded at its
               last trading session on or immediately before the valuation date,
               or
(3)            at the mean between the "bid" and "asked" prices obtained from
               the principal exchange on which the security is traded or, on the
               basis of reasonable inquiry, from two market makers in the
               security.

o Long-term debt securities having a remaining maturity in excess of 60 days are
valued based on the mean between the "bid" and "asked" prices determined by a
portfolio pricing service approved by the Funds' Board of Trustees or obtained
by the Manager from two active market makers in the security on the basis of
reasonable inquiry.

o The following securities are valued at the mean between the "bid" and "asked"
prices determined by a pricing service approved by the Funds' Board of Trustees
or obtained by the Manager from two active market makers in the security on the
basis of reasonable inquiry:
(1) debt instruments that have a maturity of more than 397 days when issued, (2)
debt instruments that had a maturity of 397 days or less when issued
               and have a remaining maturity of more than 60 days, and (3)
non-money market debt instruments that had a maturity of 397 days or
               less when issued and which have a remaining maturity of 60 days
               or less.

o The following securities are valued at cost, adjusted for amortization of
premiums and accretion of discounts: (1) money market debt securities held by a
non-money market fund that had a
               maturity of less than 397 days when issued that have a remaining
               maturity of 60 days or less, and
(2)            debt instruments held by a money market fund that have a
               remaining maturity of 397 days or less.

o Securities (including restricted securities) not having readily-available
market quotations are valued at fair value determined under the Board's
procedures. If the Manager is unable to locate two market makers willing to give
quotes, a security may be priced at the mean between the "bid" and "asked"
prices provided by a single active market maker (which in certain cases may be
the "bid" price if no "asked" price is available).

      In the case of U.S. government securities, mortgage-backed securities,
corporate bonds and foreign government securities, when last sale information is
not generally available, the Manager may use pricing services approved by the
Board of Trustees. The pricing service may use "matrix" comparisons to the
prices for comparable instruments on the basis of quality, yield and maturity.
Other special factors may be involved (such as the tax-exempt status of the
interest paid by municipal securities). The Manager will monitor the accuracy of
the pricing services. That monitoring may include comparing prices used for
portfolio valuation to actual sales prices of selected securities.

      The closing prices in the New York foreign exchange market on a particular
business day that are provided to the Manager by a bank, dealer or pricing
service that the Manager has determined to be reliable are used to value foreign
currency, including forward contracts, and to convert to U.S. dollars securities
that are denominated in foreign currency.

      Puts, calls, and futures are valued at the last sale price on the
principal exchange on which they are traded or on NASDAQ(R), as applicable, as
determined by a pricing service approved by the Board of Trustees or by the
Manager. If there were no sales that day, they shall be valued at the last sale
price on the preceding trading day if it is within the spread of the closing
"bid" and "asked" prices on the principal exchange or on NASDAQ(R) on the
valuation date. If not, the value shall be the closing bid price on the
principal exchange or on NASDAQ(R) on the valuation date. If the put, call or
future is not traded on an exchange or on NASDAQ(R), it shall be valued by the
mean between "bid" and "asked" prices obtained by the Manager from two active
market makers. In certain cases that may be at the "bid" price if no "asked"
price is available.

      When a Fund writes an option, an amount equal to the premium received is
included in that Fund's Statement of Assets and Liabilities as an asset. An
equivalent credit is included in the liability section. The credit is adjusted
("marked-to-market") to reflect the current market value of the option. In
determining the Funds' gain on investments, if a call or put written by a Fund
is exercised, the proceeds are increased by the premium received. If a call or
put written by a Fund expires, that Fund has a gain in the amount of the
premium. If that Fund enters into a closing purchase transaction, it will have a
gain or loss, depending on whether the premium received was more or less than
the cost of the closing transaction. If a Fund exercises a put it holds, the
amount that Fund receives on its sale of the underlying investment is reduced by
the amount of premium paid by the Funds.

Money Fund/VA Net Asset Valuation Per Share. Money Fund/VA will seek to maintain
a net asset value of $1.00 per share for purchases and redemptions. There can be
no assurance it will be able to do so. Money Fund/VA operates under Rule 2a-7
under which it may use the amortized cost method of valuing their shares. The
Funds' Board of Trustees has adopted procedures for that purpose. The amortized
cost method values a security initially at its cost and thereafter assumes a
constant amortization of any premium or accretion of any discount, regardless of
the impact of fluctuating interest rates on the market value of the security.
This method does not take into account unrealized capital gains or losses.

      The Funds' Board of Trustees has established procedures intended to
stabilize Money Fund/VA's net asset value at $1.00 per share. If Money Fund/VA's
net asset value per share were to deviate from $1.00 by more than 0.5%, Rule
2a-7 requires the Board promptly to consider what action, if any, should be
taken. If the Trustees find that the extent of any such deviation may result in
material dilution or other unfair effects on shareholders, the Board will take
whatever steps it considers appropriate to eliminate or reduce such dilution or
unfair effects, including, without limitation, selling portfolio securities
prior to maturity, shortening the average portfolio maturity, withholding or
reducing dividends, reducing the outstanding number of shares of that Fund
without monetary consideration, or calculating net asset value per share by
using available market quotations.

      As long as Money Fund/VA uses Rule 2a-7, it must abide by certain
conditions described in the Prospectus which limit the maturity of securities
that Fund buys. Under Rule 2a-7, the maturity of an instrument is generally
considered to be its stated maturity (or in the case of an instrument called for
redemption, the date on which the redemption payment must be made), with special
exceptions for certain variable rate demand and floating rate instruments.
Repurchase agreements and securities loan agreements are, in general, treated as
having maturity equal to the period scheduled until repurchase or return, or if
subject to demand, equal to the notice period.

      While amortized cost method provides certainty in valuation, there may be
periods during which the value of an instrument, as determined by amortized
cost, is higher or lower than the price Money Fund/VA would receive if it sold
the instrument. During periods of declining interest rates, the daily yield on
shares of that Fund may tend to be lower (and net investment income and daily
dividends higher) than market prices or estimates of market prices for its
portfolio. Thus, if the use of amortized cost by the funds resulted in a lower
aggregate portfolio value on a particular day, a prospective investor in Money
Fund/VA would be able to obtain a somewhat higher yield than would result from
investment in a fund utilizing solely market values, and existing investors in
that Fund would receive less investment income than if Money Fund/VA were priced
at market value. Conversely, during periods of rising interest rates, the daily
yield on shares of that Fund will tend to be higher and its aggregate value
lower than that of a portfolio priced at market value. A prospective investor
would receive a lower yield than from an investment in a portfolio priced at
market value, while existing investors in Money Fund/VA would receive more
investment income than if that Fund were priced at market value.

Payments "In Kind". The Prospectus states that payment for shares tendered for
redemption is ordinarily made in cash. However, under certain circumstances, the
Board of Trustees of the Global Securities Fund/VA, Main Street Fund(R)/VA and
Strategic Bond Fund/VA may determine that it would be detrimental to the best
interests of the remaining shareholders of those Funds to make payment of a
redemption order wholly or partly in cash. In that case, the Funds may pay the
redemption proceeds in whole or in part by a distribution "in kind" of liquid
portfolio securities from the portfolio of the Funds, in lieu of cash. The Board
of Trustees of the Fund has adopted procedures for "in kind" redemptions. In
accordance with the procedures, the Board of Trustees of a Fund may be required
to approve an "in kind" redemption paid to a shareholder that holds 5% or more
of the shares of any class, or of all outstanding shares, of that Fund, or to
any other shareholder that may be deemed to be an "affiliated person" under
section 2(a)(3) of the Investment Company Act.

      Each of Oppenheimer Global Securities Fund/VA, Oppenheimer Main Street
Fund(R)/VA and Oppenheimer Strategic Bond Fund/VA has elected to be governed by
Rule 18f-1 under the Investment Company Act. Under that rule, each of
Oppenheimer Global Securities Fund/VA, Oppenheimer Main Street Fund(R)/VA and
Oppenheimer Strategic Bond Fund/VA is obligated to redeem shares solely in cash
up to the lesser of $250,000 or 1% of the net assets of such Fund redeemed
during any 90-day period for any one shareholder. As of the date of this
Statement of Additional Information, those Funds intend to redeem shares in kind
only under certain limited circumstances (such as redemptions of substantial
amounts by shareholders that have consented to such in kind redemptions). If
shares are redeemed in kind, the redeeming shareholder may incur brokerage or
other costs in selling the securities. Each of Oppenheimer Global Securities
Fund/VA, Oppenheimer Main Street Fund(R)/VA and Oppenheimer Strategic Bond
Fund/VA will value securities used to pay redemptions in kind using the same
method it uses to value its portfolio securities described above under
"Determination of Net Asset Values Per Share." That valuation will be made as of
the time the redemption price is determined.

Dividends, Capital Gains and Taxes

Dividends and Distributions. The Funds have no fixed dividend rate and there can
be no assurance as to the payment of any dividends or the realization of any
capital gains. The dividends and distributions paid by a class of shares will
vary from time to time depending on market conditions, the composition of the
Funds' portfolio, and expenses borne by the Fund or borne separately by a class.
Dividends are calculated in the same manner, at the same time, and on the same
day for each class of shares. Dividends on Service shares and Class 4 Shares are
expected to be lower because of the additional expenses for those shares.
Dividends will also differ in amount as a consequence of any difference in the
net asset values of the different classes of shares.

Taxes. The federal tax treatment of each Fund dividends and capital gains
distributions is briefly highlighted in its Prospectus. The following is only a
summary of certain additional tax considerations generally affecting the Funds
and their shareholders..

      The tax discussion in the Prospectus and this Statement of Additional
Information is based on tax law in effect on the date of the Prospectus and this
Statement of Additional Information. Those laws and regulations may be changed
by legislative, judicial, or administrative action, sometimes with retroactive
effect. State and local tax treatment of ordinary income dividends and capital
gain dividends from regulated investment companies may differ from the treatment
under the Internal Revenue Code described below. Potential purchasers of shares
of the Funds are urged to consult their tax advisers with specific reference to
their own tax circumstances as well as the consequences of federal, state and
local tax rules affecting an investment in the Funds.

Qualification as a Regulated Investment Company. Each Fund has elected to be
taxed as a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended. As a regulated investment company, a Fund is
not subject to federal income tax on the portion of its net investment income
(that is, taxable interest, dividends, and other taxable ordinary income, net of
expenses) and capital gain net income (that is, the excess of net long-term
capital gains over net short-term capital losses) that it distributes to
shareholders. That qualification enables a Fund to "pass through" its income and
realized capital gains to shareholders without having to pay tax on them. This
avoids a "double tax" on that income and capital gains, since shareholders
normally will be taxed on the dividends and capital gains they receive from the
Funds (unless their Fund shares are held in a retirement account or the
shareholder is otherwise exempt from tax).

      The Internal Revenue Code contains a number of complex tests relating to
qualification that the Fund might not meet in a particular year. If it did not
qualify as a regulated investment company, a Fund would be treated for tax
purposes as an ordinary corporation and would receive no tax deduction for
payments made to shareholders.

      To qualify as a regulated investment company, a Fund must distribute at
least 90% of its investment company taxable income (in brief, net investment
income and the excess of net short-term capital gain over net long-term capital
loss) for a taxable year. The Funds must also satisfy certain other requirements
of the Internal Revenue Code, some of which are described below. Distributions
by a Fund made during the taxable year or, under specified circumstances, within
12 months after the close of the taxable year, will be considered distributions
of income and gains for the taxable year and will therefore count toward
satisfaction of the above-mentioned requirement.

      To qualify as a regulated investment company, the Funds must derive at
least 90% of its gross income from dividends, interest, certain payments with
respect to securities loans, gains from the sale or other disposition of stock
or securities or foreign currencies (to the extent such currency gains are
directly related to the regulated investment company's principal business of
investing in stock or securities) and certain other income.

      In addition to satisfying the requirements described above, the Funds must
satisfy an asset diversification test in order to qualify as a regulated
investment company. Under that test, at the close of each quarter of a Fund's
taxable year, at least 50% of the value of the Funds' assets must consist of
cash and cash items (including receivables), U.S. government securities,
securities of other regulated investment companies, and securities of other
issuers. As to each of those issuers, the Funds must not have invested more than
5% of the value of the Funds' total assets in securities of each such issuer and
the Funds must not hold more than 10% of the outstanding voting securities of
each such issuer. No more than 25% of the value of a Fund's total assets may be
invested in the securities of any one issuer (other than U.S. government
securities and securities of other regulated investment companies), or in two or
more issuers which a Fund controls and which are engaged in the same or similar
trades or businesses. For purposes of this test, obligations issued or
guaranteed by certain agencies or instrumentalities of the U.S. government are
treated as U.S. government securities.

|X| Excise Tax on Regulated Investment Companies. Under the Internal Revenue
Code, by December 31 each year, a Fund must distribute 98% of its taxable
investment income earned from January 1 through December 31 of that year and 98%
of its capital gains realized in the period from November 1 of the prior year
through October 31 of the current year. If it does not, a Fund must pay an
excise tax on the amounts not distributed. It is presently anticipated that a
Fund will meet those requirements. To meet this requirement, in certain
circumstances a Fund might be required to liquidate portfolio investments to
make sufficient distributions to avoid excise tax liability. However, the Board
of Trustees and the Manager might determine in a particular year that it would
be in the best interests of shareholders for a Fund not to make such
distributions at the required levels and to pay the excise tax on the
undistributed amounts. That would reduce the amount of income or capital gains
available for distribution to shareholders.

|X| Taxes on Foreign Investments. Investment income that may be received by a
Fund from sources within foreign countries may be subject to foreign taxes
withheld at the source. The United States has entered into tax treaties with
many foreign countries which entitle a Fund to a reduced rate of, or exemption
from, taxes on such income. The Funds may be subject to U.S. Federal income tax,
and an interest charge, on certain distributions or gains from the sale of
shares of a foreign company considered to be a PFIC, even if those amounts are
paid out as dividends to shareholders. To avoid imposition of the interest
charge, the Funds may elect to "mark to market" all PFIC shares that it holds at
the end of each taxable year. In that case, any increase or decrease in the
value of those shares would be recognized as ordinary income or as ordinary loss
(but only to the extent of previously recognized "mark-to-market" gains).

Additional Information About the Funds

The Transfer Agent. OppenheimerFunds Services, the Funds' Transfer Agent, is a
division of the Manager. It serves as the Transfer Agent for an annual per
account fee. The Transfer Agent has voluntarily agreed to limit transfer and
shareholder servicing agent fees to 0.35% per annum of shares of any class of
any Fund. That undertaking may be amended or withdrawn at any time. The Transfer
Agent acts as shareholder servicing agent for other Oppenheimer funds.
Information about your investment in the Funds through your variable annuity
contract, variable life insurance policy or other plan can be obtained only from
your participating insurance company or its servicing agent. The Funds' Transfer
Agent does not hold or have access to those records. Instructions for buying or
selling shares of the Funds should be given to your insurance company or its
servicing agent, not directly to the Funds or its Transfer Agent.

The Custodian. J.P. Morgan Chase Bank is the custodian of the Funds' assets. The
custodian's responsibilities include safeguarding and controlling the Funds'
portfolio securities and handling the delivery of such securities to and from
the Funds. It is the practice of the Funds to deal with the custodian in a
manner uninfluenced by any banking relationship the custodian may have with the
Manager and its affiliates. The Funds' cash balances with the custodian in
excess of $100,000 are not protected by federal deposit insurance. Those
uninsured balances at times may be substantial.

Independent Registered Public Accounting Firm. Deloitte & Touche LLP serves as
the independent registered public accounting firm for the Funds. Deloitte &
Touche LLP audits the Funds' financial statements and performs other related
audit services. Deloitte & Touche LLP also acts as the independent registered
public accounting firm for certain other funds advised by the Manager and its
affiliates. Audit and non-audit services provided by Deloitte & Touche LLP to
the Funds must be pre-approved by the Audit Committee.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER AGGRESSIVE GROWTH
FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Aggressive Growth Fund/VA, a series of Oppenheimer Variable Account
Funds, including the statement of investments, as of December 31, 2004, and the
related statement of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Aggressive Growth Fund/VA as of December 31, 2004, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.


DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005

STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--99.5%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--25.9%
- --------------------------------------------------------------------------------
AUTO COMPONENTS--1.3%
Gentex Corp.                                           435,400   $    16,118,508
- --------------------------------------------------------------------------------
AUTOMOBILES--1.0%
Harley-Davidson, Inc.                                  205,200        12,465,900
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--6.0%
Cheesecake Factory, Inc. (The) 1                       384,700        12,491,209
- --------------------------------------------------------------------------------
P.F. Chang's China Bistro, Inc. 1                      239,000        13,467,650
- --------------------------------------------------------------------------------
Ruby Tuesday, Inc.                                     359,800         9,383,584
- --------------------------------------------------------------------------------
Shuffle Master, Inc. 1                                 273,700        12,891,270
- --------------------------------------------------------------------------------
Starbucks Corp. 1                                      400,400        24,968,944
                                                                 ---------------
                                                                      73,202,657

- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES--0.8%
Harman International Industries, Inc.                   80,400        10,210,800
- --------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--2.4%
Brunswick Corp.                                        602,400        29,818,800
- --------------------------------------------------------------------------------
MEDIA--2.3%
Getty Images, Inc. 1                                   408,900        28,152,765
- --------------------------------------------------------------------------------
SPECIALTY RETAIL--8.6%
Bed Bath & Beyond, Inc. 1                              497,200        19,803,476
- --------------------------------------------------------------------------------
Chico's FAS, Inc. 1                                    453,700        20,656,961
- --------------------------------------------------------------------------------
O'Reilly Automotive, Inc. 1                            588,897        26,529,810
- --------------------------------------------------------------------------------
PETsMART, Inc.                                         724,400        25,737,932
- --------------------------------------------------------------------------------
Urban Outfitters, Inc. 1                               295,200        13,106,880
                                                                 ---------------
                                                                     105,835,059

- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--3.5%
Coach, Inc. 1                                          577,900        32,593,560
- --------------------------------------------------------------------------------
Polo Ralph Lauren Corp.                                246,500        10,500,900
                                                                 ---------------
                                                                      43,094,460

- --------------------------------------------------------------------------------
CONSUMER STAPLES--2.3%
- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--2.3%
Whole Foods Market, Inc.                               296,400        28,261,740
- --------------------------------------------------------------------------------
ENERGY--4.8%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--2.4%
BJ Services Co.                                        258,200        12,016,628
- --------------------------------------------------------------------------------
Smith International, Inc. 1                            322,100        17,525,461
                                                                 ---------------
                                                                      29,542,089

- --------------------------------------------------------------------------------
OIL & GAS--2.4%
Apache Corp.                                           379,000        19,166,030
- --------------------------------------------------------------------------------
XTO Energy, Inc.                                       314,500        11,127,010
                                                                 ---------------
                                                                      30,293,040


                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
FINANCIALS--11.4%
- --------------------------------------------------------------------------------
COMMERCIAL BANKS--2.2%
Commerce Bancorp, Inc.                                 426,500   $    27,466,600
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--6.0%
Chicago Mercantile Exchange (The)                       98,800        22,595,560
- --------------------------------------------------------------------------------
Investors Financial Services Corp.                     452,600        22,620,948
- --------------------------------------------------------------------------------
Legg Mason, Inc.                                       400,000        29,304,000
                                                                 ---------------
                                                                      74,520,508

- --------------------------------------------------------------------------------
INSURANCE--3.2%
AMBAC Financial Group, Inc.                            325,700        26,749,741
- --------------------------------------------------------------------------------
Brown & Brown, Inc.                                    283,700        12,355,135
                                                                 ---------------
                                                                      39,104,876

- --------------------------------------------------------------------------------
HEALTH CARE--17.3%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--3.1%
Gen-Probe, Inc. 1                                      239,500        10,827,795
- --------------------------------------------------------------------------------
Gilead Sciences, Inc. 1                                766,200        26,809,338
                                                                 ---------------
                                                                      37,637,133

- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--6.7%
Bard (C.R.), Inc.                                      330,400        21,138,992
- --------------------------------------------------------------------------------
Cooper Cos., Inc. (The)                                258,000        18,212,220
- --------------------------------------------------------------------------------
Stryker Corp.                                          132,900         6,412,425
- --------------------------------------------------------------------------------
Thermo Electron Corp. 1                                679,300        20,508,067
- --------------------------------------------------------------------------------
Varian Medical Systems, Inc. 1                         388,000        16,777,120
                                                                 ---------------
                                                                      83,048,824

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--7.5%
Coventry Health Care, Inc. 1                           368,450        19,557,326
- --------------------------------------------------------------------------------
Health Management Associates,
Inc., Cl. A                                          1,216,800        27,645,696
- --------------------------------------------------------------------------------
Lincare Holdings, Inc. 1                               377,200        16,087,580
- --------------------------------------------------------------------------------
Patterson Cos., Inc. 1                                 680,000        29,505,200
                                                                 ---------------
                                                                      92,795,802

- --------------------------------------------------------------------------------
INDUSTRIALS--15.3%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--2.9%
L-3 Communications Holdings, Inc.                      240,400        17,606,896
- --------------------------------------------------------------------------------
Rockwell Collins, Inc.                                 452,300        17,838,712
                                                                 ---------------
                                                                      35,445,608

- --------------------------------------------------------------------------------
AIR FREIGHT & LOGISTICS--2.3%
Expeditors International of
Washington, Inc.                                       509,500        28,470,860
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--3.6%
Corporate Executive Board Co.                          376,700        25,216,298
- --------------------------------------------------------------------------------
Stericycle, Inc. 1                                     418,400        19,225,480
                                                                 ---------------
                                                                      44,441,778


            7 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
MACHINERY--2.5%
Actuant Corp., Cl. A 1                                  37,500   $     1,955,625
- --------------------------------------------------------------------------------
Donaldson Co., Inc.                                    582,600        18,981,108
- --------------------------------------------------------------------------------
Oshkosh Truck Corp.                                    143,400         9,805,692
                                                                 ---------------
                                                                      30,742,425

- --------------------------------------------------------------------------------
ROAD & RAIL--1.7%
C.H. Robinson Worldwide, Inc.                          379,500        21,069,840
- --------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--2.3%
Fastenal Co.                                           464,700        28,606,932
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--22.5%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--2.0%
Comverse Technology, Inc. 1                          1,000,700        24,467,115
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--2.7%
CDW Corp.                                              394,000        26,141,900
- --------------------------------------------------------------------------------
National Instruments Corp.                             275,800         7,515,550
                                                                 ---------------
                                                                      33,657,450

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--1.2%
VeriSign, Inc. 1                                       448,600        15,037,072
- --------------------------------------------------------------------------------
IT SERVICES--7.2%
Affiliated Computer Services,
Inc., Cl. A 1                                          473,500        28,499,965
- --------------------------------------------------------------------------------
Alliance Data Systems Corp. 1                          440,100        20,895,948
- --------------------------------------------------------------------------------
Fiserv, Inc. 1                                         745,600        29,965,664
- --------------------------------------------------------------------------------
Global Payments, Inc.                                  159,700         9,348,838
                                                                 ---------------
                                                                      88,710,415

- --------------------------------------------------------------------------------
OFFICE ELECTRONICS--0.8%
Zebra Technologies Corp., Cl. A 1                      176,300         9,922,164
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--1.8%
Linear Technology Corp.                                552,000        21,395,520
- --------------------------------------------------------------------------------
SOFTWARE--6.8%
Adobe Systems, Inc.                                    446,000        27,982,040
- --------------------------------------------------------------------------------
Amdocs Ltd. 1                                          737,200        19,351,500
- --------------------------------------------------------------------------------
Autodesk, Inc.                                          73,200         2,777,940
- --------------------------------------------------------------------------------
Electronic Arts, Inc. 1                                303,800        18,738,384
- --------------------------------------------------------------------------------
Kronos, Inc. 1                                         108,100         5,527,153
- --------------------------------------------------------------------------------
Symantec Corp. 1                                       376,300         9,693,488
                                                                 ---------------
                                                                      84,070,505
                                                                 ---------------
Total Common Stocks
(Cost $949,375,860)                                                1,227,607,245


                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
PREFERRED STOCKS--0.1%
- --------------------------------------------------------------------------------
Blaze Network Products, Inc.,
8% Cv., Series D 1,2,3                               1,147,862   $           873
- --------------------------------------------------------------------------------
BroadBand Office, Inc., Cv.,
Series C 1,2,3                                         211,641                --
- --------------------------------------------------------------------------------
Centerpoint Broadband
Technologies, Inc.:
Cv., Series D 1,2,3                                  1,298,701                --
Cv., Series Z 1,2,3                                    262,439                --
- --------------------------------------------------------------------------------
MicroPhotonix Integration Corp.,
Cv., Series C 1,2,3                                    633,383                --
- --------------------------------------------------------------------------------
Multiplex, Inc., Cv., Series C 1,2,3                 2,330,253           564,154
- --------------------------------------------------------------------------------
Questia Media, Inc., Cv., Series B 1,2,3             2,329,735           969,869
                                                                 ---------------
Total Preferred Stocks
(Cost $62,496,986)                                                     1,534,896

                                                     PRINCIPAL
                                                        AMOUNT
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--0.3%
- --------------------------------------------------------------------------------
Undivided interest of 0.23% in joint repurchase
agreement (Principal Amount/Value $1,443,703,000,
with a maturity value of $1,443,962,867) with UBS
Warburg LLC, 2.16%, dated 12/31/04, to be
repurchased at $3,287,592 on 1/3/05, collateralized
by Federal National Mortgage Assn., 5%--6%,
4/1/34--10/1/34, with a value of
$1,474,609,071 (Cost $3,287,000)                   $ 3,287,000         3,287,000

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $1,015,159,846)                                     99.9%    1,232,429,141
- --------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES                            0.1         1,180,695
                                                   -----------------------------
NET ASSETS                                               100.0%  $ 1,233,609,836
                                                   =============================


            8 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of December 31, 2004 was $1,534,896, which represents
0.12% of the Fund's net assets, of which $1,534,896 is considered restricted.
See Note 5 of Notes to Financial Statements.

3. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended December 31, 2004.
The aggregate fair value of securities of affiliated companies held by the Fund
as of December 31, 2004 amounts to $1,534,896. Transactions during the period in
which the issuer was an affiliate are as follows:

                                                                     SHARES          GROSS        GROSS              SHARES
                                                          DECEMBER 31, 2003      ADDITIONS   REDUCTIONS   DECEMBER 31, 2004
- ---------------------------------------------------------------------------------------------------------------------------

Axsun Technologies, Inc., Cv., Series C                           3,170,523             --   (3,170,523)                 --
Blaze Network Products, Inc., 8% Cv., Series D                    1,147,862             --           --           1,147,862
BroadBand Office, Inc., Cv., Series C                               211,641             --           --             211,641
Centerpoint Broadband Technologies, Inc., Cv., Series D           1,298,701             --           --           1,298,701
Centerpoint Broadband Technologies, Inc., Cv., Series Z             262,439             --           --             262,439
fusionOne, Inc., 8% Non-Cum. Cv., Series D                        2,663,972             --   (2,663,972)                 --
MicroPhotonix Integration Corp., Cv., Series C                      633,383             --           --             633,383
Multiplex, Inc., Cv., Series C                                    2,330,253             --           --           2,330,253
Questia Media, Inc., Cv., Series B                                2,329,735             --           --           2,329,735
                                                                                UNREALIZED     DIVIDEND            REALIZED
                                                                              DEPRECIATION       INCOME                LOSS
- ---------------------------------------------------------------------------------------------------------------------------

Axsun Technologies, Inc., Cv., Series C                                       $         --   $       --   $      35,097,690
Blaze Network Products, Inc., 8% Cv., Series D                                   7,345,444           --                  --
BroadBand Office, Inc., Cv., Series C                                            4,000,015           --                  --
Centerpoint Broadband Technologies, Inc., Cv., Series D                         13,999,997           --                  --
Centerpoint Broadband Technologies, Inc., Cv., Series Z                          6,999,992           --                  --
fusionOne, Inc., 8% Non-Cum. Cv., Series D                                              --           --          13,886,753
MicroPhotonix Integration Corp., Cv., Series C                                   4,000,004           --                  --
Multiplex, Inc., Cv., Series C                                                  16,586,508           --                  --
Questia Media, Inc., Cv., Series B                                               8,030,130           --                  --
                                                                              ---------------------------------------------
                                                                              $ 60,962,090   $       --   $      48,984,443
                                                                              =============================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            9 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------


- ------------------------------------------------------------------------------------------
ASSETS
- ------------------------------------------------------------------------------------------
Investments, at value--see accompanying statement of investments:
Unaffiliated companies (cost $952,662,860)                                $ 1,230,894,245
Affiliated companies (cost $62,496,986)                                         1,534,896
                                                                          ----------------
                                                                            1,232,429,141
- ------------------------------------------------------------------------------------------
Cash                                                                              300,688
- ------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold                                                                  750,381
Shares of beneficial interest sold                                                576,828
Interest and dividends                                                            191,812
Other                                                                              13,357
                                                                          ----------------
Total assets                                                                1,234,262,207

- ------------------------------------------------------------------------------------------
LIABILITIES
- ------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                            521,138
Shareholder communications                                                         55,262
Legal, auditing and other professional fees                                        32,433
Trustees' compensation                                                             19,178
Distribution and service plan fees                                                 13,448
Custodian fees                                                                      5,255
Transfer and shareholder servicing agent fees                                       1,724
Other                                                                               3,933
                                                                          ----------------
Total liabilities                                                                 652,371

- ------------------------------------------------------------------------------------------
NET ASSETS                                                                $ 1,233,609,836
                                                                          ================

- ------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                $        28,059
- ------------------------------------------------------------------------------------------
Additional paid-in capital                                                  1,804,653,955
- ------------------------------------------------------------------------------------------
Accumulated net investment loss                                                   (13,347)
- ------------------------------------------------------------------------------------------
Accumulated net realized loss on investments                                 (788,328,126)
- ------------------------------------------------------------------------------------------
Net unrealized appreciation on investments                                    217,269,295
                                                                          ----------------
NET ASSETS                                                                $ 1,233,609,836
                                                                          ================

- ------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per
share (based on net assets of $1,209,459,305 and 27,506,281 shares of
beneficial interest outstanding)                                          $         43.97
- ------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per
share (based on net assets of $24,150,531 and 553,430 shares of
beneficial interest outstanding)                                          $         43.64


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            10 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $4,622)           $    3,356,689
- --------------------------------------------------------------------------------
Interest                                                                113,675
                                                                 ---------------
Total investment income                                               3,470,364

- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees                                                       7,692,943
- --------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                       43,863
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                       10,165
Service shares                                                           10,001
- --------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                       77,471
Service shares                                                            1,237
- --------------------------------------------------------------------------------
Trustees' compensation                                                   23,623
- --------------------------------------------------------------------------------
Custodian fees and expenses                                              23,398
- --------------------------------------------------------------------------------
Other                                                                    55,128
                                                                 ---------------
Total expenses                                                        7,937,829
Less reduction to custodian expenses                                     (1,987)
                                                                 ---------------
Net expenses                                                          7,935,842

- --------------------------------------------------------------------------------
NET INVESTMENT LOSS                                                  (4,465,478)

- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments:
  Unaffiliated companies                                             48,472,613
  Affiliated companies                                              (48,984,443)
Net increase from payment by affiliate                                   94,429
                                                                 ---------------
Net realized loss                                                      (417,401)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on investments                213,639,469

- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS             $  208,756,590
                                                                 ===============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            11 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

YEAR ENDED DECEMBER 31,                                                      2004              2003
- ----------------------------------------------------------------------------------------------------

OPERATIONS
- ----------------------------------------------------------------------------------------------------
Net investment loss                                               $    (4,465,478)  $    (4,523,545)
- ----------------------------------------------------------------------------------------------------
Net realized gain (loss)                                                 (417,401)       62,819,476
- ----------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                  213,639,469       175,024,712
                                                                  ----------------------------------
Net increase in net assets resulting from operations                  208,756,590       233,320,643

- ----------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial
interest transactions:
Non-Service shares                                                   (109,692,557)      (98,877,573)
Service shares                                                          9,104,838        10,935,179

- ----------------------------------------------------------------------------------------------------
NET ASSETS
- ----------------------------------------------------------------------------------------------------
Total increase                                                        108,168,871       145,378,249
- ----------------------------------------------------------------------------------------------------
Beginning of period                                                 1,125,440,965       980,062,716
                                                                  ----------------------------------
End of period (including accumulated net investment loss of
$13,347 for the year ended December 31, 2004)                     $ 1,233,609,836   $ 1,125,440,965
                                                                  ==================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            12 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------


NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                  2004            2003            2002            2001            2000
- ------------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                  $     36.71     $     29.23     $     40.72     $     70.77     $     82.31
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                 (.15) 1         (.15)           (.10)            .23             .53
Net realized and unrealized gain (loss)                      7.41            7.63          (11.16)         (21.38)          (8.59)
                                                      ------------------------------------------------------------------------------
Total from investment operations                             7.26            7.48          (11.26)         (21.15)          (8.06)
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                           --              --            (.23)           (.54)             --
Distributions from net realized gain                           --              --              --           (8.36)          (3.48)
                                                      ------------------------------------------------------------------------------
Total dividends and/or distributions to shareholders           --              --            (.23)          (8.90)          (3.48)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                        $     43.97     $     36.71     $     29.23     $     40.72     $     70.77
                                                      ==============================================================================

- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                          19.78%          25.59%         (27.79)%        (31.27)%        (11.24)%
- ------------------------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)              $ 1,209,459     $ 1,113,743     $   979,919     $ 1,621,550     $ 2,595,101
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                     $ 1,124,874     $ 1,041,584     $ 1,240,435     $ 1,898,088     $ 2,978,465
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income (loss)                                (0.39)%         (0.43)%         (0.29)%          0.47%           0.65%
Total expenses                                               0.69% 4         0.70% 4         0.68% 4         0.68% 4         0.64% 4
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                        53%            154%             54%            134%             39%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            13 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

SERVICE SHARES  YEAR ENDED DECEMBER 31,                      2004            2003            2002            2001          2000 1
- -----------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                    $   36.54     $     29.13     $     40.70     $     70.77     $     97.75
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                 (.27) 2           -- 3           .16             .19             .20
Net realized and unrealized gain (loss)                      7.37            7.41          (11.53)         (21.36)         (27.18)
                                                        ---------------------------------------------------------------------------
Total from investment operations                             7.10            7.41          (11.37)         (21.17)         (26.98)
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                           --              --            (.20)           (.54)             --
Distributions from net realized gain                           --              --              --           (8.36)             --
                                                        ---------------------------------------------------------------------------
Total dividends and/or distributions to shareholders           --              --            (.20)          (8.90)             --
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                          $   43.64     $     36.54     $     29.13     $     40.70     $     70.77
                                                        ===========================================================================

- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 4                          19.43%          25.44%         (28.05)%        (31.31)%        (27.60)%
- -----------------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                $  24,151     $    11,698     $       144     $        54     $         1
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                       $  17,579     $     3,858     $        72     $        31     $         1
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment income (loss)                                (0.68)%         (0.72)%         (0.56)%          0.09%           1.14%
Total expenses                                               0.99%           0.95%           1.55%           0.83%           0.64%
Expenses after payments and waivers and reduction
to custodian expenses                                         N/A 6           N/A 6          0.98%            N/A 6           N/A 6
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                        53%            154%             54%            134%             39%


1. For the period from October 16, 2000 (inception of offering) to December 31,
2000.

2. Per share amounts calculated based on the average shares outstanding
during the period.

3. Less than $0.005 per share.

4. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            14 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Aggressive Growth Fund/VA (the Fund) is a separate series of
Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek capital appreciation by
investing in "growth type" companies. The Trust's investment advisor is
OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.


            15 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                                  NET UNREALIZED
                                                                    APPRECIATION
                                                                BASED ON COST OF
                                                                  SECURITIES AND
UNDISTRIBUTED    UNDISTRIBUTED             ACCUMULATED         OTHER INVESTMENTS
NET INVESTMENT       LONG-TERM                    LOSS        FOR FEDERAL INCOME
INCOME                    GAIN    CARRYFORWARD 1,2,3,4              TAX PURPOSES
- --------------------------------------------------------------------------------
$--                        $--            $788,249,069              $217,190,229

1. As of December 31, 2004, the Fund had $777,504,238 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

                        EXPIRING
                        ------------------------
                        2009       $ 547,279,416
                        2010         230,224,822
                        ------------------------
                        Total      $ 777,504,238
                                   =============

2. As of December 31, 2004, the Fund had $10,744,831 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

3. During the fiscal year ended December 31, 2004, the Fund utilized $9,896,185
of capital loss carryforward to offset capital gains realized in that fiscal
year.

4. During the fiscal year ended December 31, 2003, the Fund utilized $32,872,643
of capital loss carryforward to offset capital gains realized in that fiscal
year.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

                                                  INCREASE TO
                               REDUCTION TO   ACCUMULATED NET
          REDUCTION TO      ACCUMULATED NET     REALIZED LOSS
          PAID-IN CAPITAL   INVESTMENT LOSS    ON INVESTMENTS
          ---------------------------------------------------
          $4,357,702             $4,452,131           $94,429

No distributions were paid during the years ended December 31, 2004 and December
31, 2003.

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

              Federal tax cost of securities   $ 1,015,238,912
                                               ================
              Gross unrealized appreciation    $   283,313,180
              Gross unrealized depreciation        (66,122,951)
                                               ----------------
              Net unrealized appreciation      $   217,190,229
                                               ================

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other

            16 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


Oppenheimer funds selected by the Trustee. The Fund purchases shares of the
funds selected for deferral by the Trustee in amounts equal to his or her deemed
investment, resulting in a Fund asset equal to the deferred compensation
liability. Such assets are included as a component of "Other" within the asset
section of the Statement of Assets and Liabilities. Deferral of trustees' fees
under the plan will not affect the net assets of the Fund, and will not
materially affect the Fund's assets, liabilities or net investment income per
share. Amounts will be deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:

                           YEAR ENDED DECEMBER 31, 2004  YEAR ENDED DECEMBER 31, 2003
                               SHARES           AMOUNT        SHARES           AMOUNT
- --------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                        2,254,599   $   88,253,010     7,581,692   $  249,645,333
Redeemed                   (5,085,553)    (197,945,567)  (10,767,148)    (348,522,906)
                           -----------------------------------------------------------
Net decrease               (2,830,954)  $ (109,692,557)   (3,185,456)  $  (98,877,573)
                           ===========================================================

- --------------------------------------------------------------------------------------
SERVICE SHARES
Sold                          312,167   $   12,156,781       328,184   $   11,390,813
Redeemed                      (78,906)      (3,051,943)      (12,954)        (455,634)
                           -----------------------------------------------------------
Net increase                  233,261   $    9,104,838       315,230   $   10,935,179
                           ===========================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$598,039,270 and $679,849,231, respectively.


            17 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% of the next $700 million and 0.58% of average annual
net assets over $1.5 billion.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$19,290 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. Following a review of its use of brokerage
commissions for sales that is permitted under its investment advisory agreement,
the Fund's Manager terminated that practice in July 2003. Subsequently, the
Manager paid the Fund $94,429, an amount equivalent to certain of such
commissions incurred in prior years.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. ILLIQUID OR RESTRICTED SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 15% of
its net assets (determined at the time of purchase and reviewed periodically) in
illiquid or restricted securities. Certain restricted securities, eligible for
resale to qualified institutional investors, are not subject to that limitation.
Information concerning restricted securities is as follows:

                                                            ACQUISITION                   VALUATION AS OF     UNREALIZED
SECURITY                                                          DATES          COST   DECEMBER 31, 2004   DEPRECIATION
- ------------------------------------------------------------------------------------------------------------------------

Blaze Network Products, Inc., 8% Cv., Series D                 10/17/00   $ 7,346,317         $       873   $  7,345,444
BroadBand Office, Inc., Cv., Series C                           8/28/00     4,000,015                  --      4,000,015
Centerpoint Broadband Technologies, Inc., Cv., Series D        10/23/00    13,999,997                  --     13,999,997
Centerpoint Broadband Technologies, Inc., Cv., Series Z         5/26/00     6,999,992                  --      6,999,992
MicroPhotonix Integration Corp., Cv., Series C                   7/6/00     4,000,004                  --      4,000,004
Multiplex, Inc., Cv., Series C                                   2/9/01    17,150,662             564,154     16,586,508
Questia Media, Inc., Cv., Series B                              8/18/00     8,999,999             969,869      8,030,130



            18 | OPPENHEIMER AGGRESSIVE GROWTH FUND/VA


- --------------------------------------------------------------------------------
6. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER BALANCED FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Balanced Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Balanced Fund/VA as of December 31, 2004, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP

DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005


STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                       SHARES        SEE NOTE 1
- -------------------------------------------------------------------------------
COMMON STOCKS--52.4%
- -------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--8.6%
- -------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--0.8%
McDonald's Corp.                                      154,500   $     4,953,270
- -------------------------------------------------------------------------------
HOUSEHOLD DURABLES--0.3%
WCI Communities, Inc. 1                                69,600         2,046,240
- -------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL--0.5%
IAC/InterActiveCorp                                   103,600         2,861,432
- -------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--0.1%
Leapfrog Enterprises, Inc. 1                           47,200           641,920
- -------------------------------------------------------------------------------
MEDIA--6.6%
Liberty Media Corp., Cl. A 1                          996,200        10,938,276
- -------------------------------------------------------------------------------
Liberty Media International, Inc., Cl. A 1             46,794         2,163,287
- -------------------------------------------------------------------------------
UnitedGlobalCom, Inc., Cl. A 1                      2,268,484        21,913,555
- -------------------------------------------------------------------------------
Viacom, Inc., Cl. B                                   131,800         4,796,202
                                                                ---------------
                                                                     39,811,320

- -------------------------------------------------------------------------------
SPECIALTY RETAIL--0.3%
Gap, Inc. (The)                                        82,300         1,738,176
- -------------------------------------------------------------------------------
CONSUMER STAPLES--3.7%
- -------------------------------------------------------------------------------
BEVERAGES--1.0%
Constellation Brands, Inc., Cl. A 1                   133,900         6,227,689
- -------------------------------------------------------------------------------
FOOD PRODUCTS--0.7%
Tyson Foods, Inc., Cl. A                              233,800         4,301,920
- -------------------------------------------------------------------------------
TOBACCO--2.0%
Altria Group, Inc.                                    199,600        12,195,560
- -------------------------------------------------------------------------------
Energy--3.7%
- -------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.3%
Halliburton Co.                                        42,600         1,671,624
- -------------------------------------------------------------------------------
OIL & GAS--3.4%
BP plc, ADR                                            50,400         2,943,360
- -------------------------------------------------------------------------------
Kinder Morgan, Inc.                                    34,900         2,552,237
- -------------------------------------------------------------------------------
LUKOIL, Sponsored ADR                                  44,300         5,426,750
- -------------------------------------------------------------------------------
Petroleo Brasileiro SA, Preference                     81,000         2,962,782
- -------------------------------------------------------------------------------
Talisman Energy, Inc.                                 137,700         3,717,894
- -------------------------------------------------------------------------------
Total SA, B Shares                                      1,700           372,570
- -------------------------------------------------------------------------------
TotalFinaElf SA, Sponsored ADR                         24,000         2,636,160
                                                                ---------------
                                                                     20,611,753

- -------------------------------------------------------------------------------
FINANCIALS--10.0%
- -------------------------------------------------------------------------------
CAPITAL MARKETS--0.4%
UBS AG                                                 25,042         2,099,863
- -------------------------------------------------------------------------------
COMMERCIAL BANKS--2.5%
Bank of America Corp.                                 169,968         7,986,796
- -------------------------------------------------------------------------------
Wachovia Corp.                                         74,315         3,908,969
- -------------------------------------------------------------------------------
Wells Fargo & Co.                                      54,600         3,393,390
                                                                ---------------
                                                                     15,289,155


                                                                          VALUE
                                                       SHARES        SEE NOTE 1
- -------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--3.2%
Citigroup, Inc.                                       164,100   $     7,906,338
- -------------------------------------------------------------------------------
JPMorgan Chase & Co.                                  100,500         3,920,505
- -------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.                         70,500         6,167,340
- -------------------------------------------------------------------------------
Morgan Stanley                                         30,600         1,698,912
                                                                ---------------
                                                                     19,693,095

- -------------------------------------------------------------------------------
INSURANCE--2.7%
Assured Guaranty Ltd.                                 181,900         3,577,973
- -------------------------------------------------------------------------------
Genworth Financial, Inc., Cl. A                       258,500         6,979,500
- -------------------------------------------------------------------------------
Prudential Financial, Inc.                            109,000         5,990,640
                                                                ---------------
                                                                     16,548,113

- -------------------------------------------------------------------------------
REAL ESTATE--0.4%
Host Marriott Corp.                                   140,500         2,430,650
- -------------------------------------------------------------------------------
THRIFTS & MORTGAGE FINANCE--0.8%
Freddie Mac                                            67,200         4,952,640
- -------------------------------------------------------------------------------
HEALTH CARE--7.6%
- -------------------------------------------------------------------------------
BIOTECHNOLOGY--1.9%
MedImmune, Inc. 1                                     167,900         4,551,769
- -------------------------------------------------------------------------------
Wyeth                                                 158,300         6,741,997
                                                                ---------------
                                                                     11,293,766

- -------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--0.7%
Beckman Coulter, Inc.                                  61,000         4,086,390
- -------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--1.3%
Manor Care, Inc.                                       47,600         1,686,468
- -------------------------------------------------------------------------------
PacifiCare Health Systems, Inc.                        46,800         2,645,136
- -------------------------------------------------------------------------------
Tenet Healthcare Corp. 1                              349,700         3,839,706
                                                                ---------------
                                                                      8,171,310

- -------------------------------------------------------------------------------
PHARMACEUTICALS--3.7%
GlaxoSmithKline plc, ADR                               62,600         2,966,614
- -------------------------------------------------------------------------------
Novartis AG                                            89,813         4,525,798
- -------------------------------------------------------------------------------
Pfizer, Inc.                                          207,600         5,582,364
- -------------------------------------------------------------------------------
Schering-Plough Corp.                                 175,200         3,658,176
- -------------------------------------------------------------------------------
Watson Pharmaceuticals, Inc. 1                        170,700         5,600,667
                                                                ---------------
                                                                     22,333,619

- -------------------------------------------------------------------------------
INDUSTRIALS--5.7%
- -------------------------------------------------------------------------------
AEROSPACE & DEFENSE--2.9%
Empresa Brasileira de
Aeronautica SA, ADR                                   101,400         3,390,816
- -------------------------------------------------------------------------------
Honeywell International, Inc.                          83,600         2,960,276
- -------------------------------------------------------------------------------
Orbital Sciences Corp. 1                              557,464         6,594,799
- -------------------------------------------------------------------------------
Raytheon Co.                                          121,800         4,729,494
                                                                ---------------
                                                                     17,675,385


            8 | OPPENHEIMER BALANCED FUND/VA


                                                                          VALUE
                                                       SHARES        SEE NOTE 1
- -------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--1.9%
Cendant Corp.                                         484,500   $    11,327,610
- -------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.9%
General Electric Co.                                   97,900         3,573,350
- -------------------------------------------------------------------------------
Tyco International Ltd.                                48,800         1,744,112
                                                                ---------------
                                                                      5,317,462

- -------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--8.9%
- -------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--2.2%
Hewlett-Packard Co.                                   145,400         3,049,038
- -------------------------------------------------------------------------------
International Business Machines Corp.                 103,500        10,203,030
                                                                ---------------
                                                                     13,252,068

- -------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--0.8%
Flextronics International Ltd. 1                      347,800         4,806,596
- -------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.3%
Net2Phone, Inc. 1                                     481,500         1,637,100
- -------------------------------------------------------------------------------
IT SERVICES--0.3%
CSG Systems International, Inc.                       115,700         2,163,590
- -------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--1.3%
Freescale Semiconductor, Inc., Cl. A 1                282,900         5,041,278
- -------------------------------------------------------------------------------
Intel Corp.                                           128,600         3,007,954
                                                                ---------------
                                                                      8,049,232

- -------------------------------------------------------------------------------
SOFTWARE--4.0%
Compuware Corp. 1                                     245,400         1,587,738
- -------------------------------------------------------------------------------
Microsoft Corp.                                       290,000         7,745,900
- -------------------------------------------------------------------------------
Novell, Inc. 1                                        252,700         1,705,725
- -------------------------------------------------------------------------------
Synopsys, Inc. 1                                       39,600           776,952
- -------------------------------------------------------------------------------
Take-Two Interactive Software, Inc.                   355,800        12,378,282
                                                                ---------------
                                                                     24,194,597

- -------------------------------------------------------------------------------
MATERIALS--1.4%
- -------------------------------------------------------------------------------
CHEMICALS--0.4%
Praxair, Inc.                                          58,900         2,600,435
- -------------------------------------------------------------------------------
Sterling Chemicals, Inc. 1,2                               18               671
                                                                ---------------
                                                                      2,601,106

- -------------------------------------------------------------------------------
METALS & MINING--0.7%
Companhia Vale do Rio Doce,
Sponsored ADR                                         115,800         2,823,204
- -------------------------------------------------------------------------------
GrafTech International Ltd. 1                         164,200         1,553,332
                                                                ---------------
                                                                      4,376,536

- -------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--0.3%
Bowater, Inc.                                          33,700         1,481,789


                                                                          VALUE
                                                       SHARES        SEE NOTE 1
- -------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--1.3%
- -------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--1.3%
IDT Corp., Cl. B 1                                    494,600   $     7,656,408
- -------------------------------------------------------------------------------
WorldCom, Inc./WorldCom Group 1                       375,000                --
                                                                ---------------
                                                                      7,656,408

- -------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--0.0%
Leap Wireless International, Inc. 1                     1,707            46,089
- -------------------------------------------------------------------------------
UTILITIES--1.5%
- -------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.2%
AES Corp. (The) 1                                     389,900         5,329,933
- -------------------------------------------------------------------------------
PG&E Corp.                                             58,100         1,933,568
                                                                ---------------
                                                                      7,263,501

- -------------------------------------------------------------------------------
GAS UTILITIES--0.3%
Sempra Energy                                          52,900         1,940,372
                                                                ---------------
Total Common Stocks (Cost $222,624,033)                             317,748,946

                                                        UNITS
- -------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- -------------------------------------------------------------------------------
HF Holdings, Inc. Wts., Exp. 9/27/09 1,2                2,593                26
- -------------------------------------------------------------------------------
Lucent Technologies, Inc. Wts.,
Exp. 12/10/07 1                                         8,881            14,032
- -------------------------------------------------------------------------------
Sterling Chemicals, Inc. Wts.,
Exp. 12/19/08 1,2                                          31               145
- -------------------------------------------------------------------------------
Sun Healthcare Group, Inc. Wts.,
Exp. 2/28/05 1                                          1,241                --
                                                                ---------------
Total Rights, Warrants and Certificates
(Cost $38,932)                                                           14,203

                                                    PRINCIPAL
                                                       AMOUNT
- -------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--5.9%
- -------------------------------------------------------------------------------
Bank One Auto Securitization Trust,
Automobile Receivable Certificates,
Series 2003-1, Cl. A2, 1.29%, 8/21/06         $       428,668           427,907
- -------------------------------------------------------------------------------
BMW Vehicle Owner Trust,
Automobile Loan Certificates,
Series 2004-A, Cl. A2, 1.88%, 10/25/06              1,342,339         1,338,035
- -------------------------------------------------------------------------------
Capital Auto Receivables Asset
Trust, Automobile Mtg.-Backed Nts.,
Series 2004-2, Cl. A3, 3.58%, 1/15/09               1,270,000         1,268,413
- -------------------------------------------------------------------------------
Centex Home Equity Co. LLC, Home
Equity Loan Asset-Backed Certificates:
Series 2003-C, Cl. AF1, 2.14%, 7/25/18                118,828           118,696
Series 2004-A, Cl. AF1, 2.03%, 6/25/19                279,453           278,377
Series 2004-D, Cl. AF1, 2.98%, 4/25/20 2              548,493           546,714


            9 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- -------------------------------------------------------------------------------
Chase Funding Mortgage Loan
Asset-Backed Certificates, Home
Equity Mtg. Obligations:
Series 2002-4, Cl. 1A3, 3.44%,
4/25/23                                       $       176,951   $       176,963
Series 2003-1, Cl. 1A3, 3.14%,
7/25/23                                               519,865           519,594
Series 2003-4, Cl. 1A1, 2.538%,
9/25/17 3                                             105,089           105,145
Series 2003-4, Cl. 1A2, 2.138%,
7/25/18                                               470,000           468,421
Series 2004-1, Cl. 2A1, 2.528%,
9/25/21 3                                             912,702           913,289
- -------------------------------------------------------------------------------
Chase Manhattan Auto Owner Trust,
Automobile Loan Pass-Through
Certificates:
Series 2002-A, Cl. A4, 4.24%, 9/15/08                 270,583           272,276
Series 2003-B, Cl. A2, 1.28%, 3/15/06                 111,861           111,799
- -------------------------------------------------------------------------------
CIT Equipment Collateral,
Equipment Receivable-Backed Nts.,
Series 2004-DFS, Cl. A2, 2.66%,
11/20/06 2                                            900,000           896,169
- -------------------------------------------------------------------------------
Citibank Credit Card Issuance Trust,
Credit Card Receivable Nts., Series
2002-A3, Cl. A3, 4.40%, 5/15/07                     1,050,000         1,057,252
- -------------------------------------------------------------------------------
CitiFinancial Mortgage Securities,
Inc., Home Equity Collateralized
Mtg. Obligations:
Series 2003-2, Cl. AF1, 2.518%,
5/25/33 3                                              62,274            62,315
Series 2003-3, Cl. AF1, 2.538%,
8/25/33 3                                             288,500           288,693
- -------------------------------------------------------------------------------
Citigroup Mortgage Loan Trust,
Inc., Home Equity Mtg. Obligations,
Series 2004-OPT1, Cl. A1B, 2.388%,
9/1/34 2                                              957,943           956,745
- -------------------------------------------------------------------------------
Countrywide Asset-Backed
Certificates, Inc., Home Equity
Asset-Backed Certificates, Series
2002-4, Cl. A1, 2.788%, 2/25/33 3                     247,806           249,209
- -------------------------------------------------------------------------------
DaimlerChrysler Auto Trust,
Automobile Loan Pass-Through
Certificates:
Series 2003-A, Cl. A2, 1.52%, 12/8/05                 344,336           344,301
Series 2003-B, Cl. A2, 1.61%, 7/10/06               1,429,174         1,426,772
Series 2004-B, Cl. A2, 2.48%, 2/8/07 2              1,000,000           997,602
Series 2004-C, Cl. A2, 2.62%, 6/8/07                1,720,000         1,714,720
- -------------------------------------------------------------------------------
Ford Credit Auto Owner Trust,
Automobile Loan Pass-Through
Certificates, Series 2004-A,
Cl. A2, 2.13%, 10/15/06                             2,200,000         2,191,434


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- -------------------------------------------------------------------------------
Harley-Davidson Motorcycle Trust,
Motorcycle Receivable Nts., Series
2003-3, Cl. A1, 1.50%, 1/15/08                $       768,019   $       765,306
- -------------------------------------------------------------------------------
Honda Auto Receivables Owner
Trust, Automobile Receivable
Obligations:
Series 2003-3, Cl. A2, 1.52%, 4/21/06                 815,279           813,913
Series 2003-4, Cl. A2, 1.58%, 7/17/06               1,186,525         1,183,878
- -------------------------------------------------------------------------------
Household Automotive Trust,
Automobile Loan Certificates,
Series 2003-2, Cl. A2, 1.56%, 12/18/06                483,178           482,223
- -------------------------------------------------------------------------------
M&I Auto Loan Trust, Automobile
Loan Certificates:
Series 2002-1, Cl. A3, 2.49%, 10/22/07                499,345           499,276
Series 2003-1, Cl. A2, 1.60%, 7/20/06                 780,991           779,864
- -------------------------------------------------------------------------------
National City Auto Receivables
Trust, Automobile Receivable
Obligations, Series 2004-A, Cl. A2,
1.50%, 2/15/07                                        830,296           827,374
- -------------------------------------------------------------------------------
Nissan Auto Lease Trust,
Automobile Lease Obligations:
Series 2003-A, Cl. A2, 1.69%, 12/15/05                 77,230            77,230
Series 2004-A, Cl. A2, 2.55%, 1/15/07                 840,000           839,430
- -------------------------------------------------------------------------------
Nissan Auto Receivables Owner
Trust, Automobile Receivable Nts.:
Series 2002-A, Cl. A4, 4.28%, 10/16/06                214,670           215,752
Series 2004-A, Cl. A2, 1.40%, 7/17/06                 941,394           937,610
- -------------------------------------------------------------------------------
Option One Mortgage Loan Trust,
Home Equity Mtg. Obligations, Series
2004-3, Cl. A2, 2.568%, 11/25/34 2,3                  538,440           538,787
- -------------------------------------------------------------------------------
Popular ABS Mortgage Pass-Through
Trust, Home Equity Pass-Through
Certificates, Series 2004-5, Cl. AF2,
3.735%, 11/10/34 2                                    340,000           338,869
- -------------------------------------------------------------------------------
Toyota Auto Receivables Owner
Trust, Automobile Mtg.-Backed
Obligations:
Series 2002-B, Cl. A3, 3.76%, 6/15/06                  77,995            78,108
Series 2003-B, Cl. A2, 1.43%, 2/15/06                 315,355           315,162
- -------------------------------------------------------------------------------
USAA Auto Owner Trust,
Automobile Loan Asset-Backed Nts.:
Series 2002-1, Cl. A3, 2.41%, 10/16/06                206,620           206,613
Series 2004-1, Cl. A2, 1.43%, 9/15/06               2,232,894         2,225,786
Series 2004-2, Cl. A2, 2.41%, 2/15/07               1,030,000         1,026,746
Series 2004-3, Cl. A2, 2.79%, 6/15/07                 820,000           818,382
- -------------------------------------------------------------------------------
Volkswagen Auto Lease Trust,
Automobile Lease Asset-Backed
Securities, Series 2004-A, Cl. A2,
2.47%, 1/22/07                                      1,040,000         1,035,247


            10 | OPPENHEIMER BALANCED FUND/VA


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- --------------------------------------------------------------------------------
Volkswagen Auto Loan Enhanced
Trust, Automobile Loan Receivable
Certificates:
Series 2003-1, Cl. A2, 1.11%, 12/20/05        $       143,570   $       143,521
Series 2003-2, Cl. A2, 1.55%, 6/20/06                 619,502           618,299
- -------------------------------------------------------------------------------
Wachovia Auto Owner Trust,
Automobile Receivable Nts., Series
2004-B, Cl. A2, 2.40%, 5/21/07                        740,000           736,955
- -------------------------------------------------------------------------------
Wells Fargo Home Equity Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. AI1B, 2.94%, 9/25/18             1,530,733         1,523,659
- -------------------------------------------------------------------------------
Whole Auto Loan Trust, Automobile
Loan Receivable Certificates:
Series 2003-1, Cl. A2A, 1.40%, 4/15/06                766,394           764,957
Series 2004-1, Cl. A2A, 2.59%, 5/15/07              1,070,000         1,066,063
                                                                ---------------
Total Asset-Backed Securities
(Cost $35,698,339)                                                   35,589,851

- -------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS--31.9%
- -------------------------------------------------------------------------------
GOVERNMENT AGENCY--27.6%
- -------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED--27.5%
Federal Home Loan Mortgage Corp.:
5%, 1/1/35 4                                       12,183,000        12,099,242
5.50%, 1/1/35 4                                     7,814,000         7,938,540
6.50%, 7/1/28-4/1/34                                1,451,574         1,526,542
7%, 5/1/29-11/1/34                                  9,828,160        10,422,441
7%, 1/1/35 4                                        1,697,000         1,797,759
- -------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.,
Gtd. Real Estate Mtg. Investment
Conduit Multiclass Pass-Through
Certificates:
Series 1669, Cl. G, 6.50%, 2/15/23                    280,065           282,296
Series 2055, Cl. ZM, 6.50%, 5/15/28                   722,759           751,722
Series 2075, Cl. D, 6.50%, 8/15/28                  1,622,217         1,688,728
Series 2080, Cl. Z, 6.50%, 8/15/28                    455,576           469,770
Series 2387, Cl. PD, 6%, 4/15/30                      937,202           971,466
Series 2466, Cl. PD, 6.50%, 4/15/30                   259,674           260,925
Series 2498, Cl. PC, 5.50%, 10/15/14                  134,573           135,726
Series 2500, Cl. FD, 2.903%, 3/15/32 3                269,712           270,770
Series 2526, Cl. FE, 2.803%, 6/15/29 3                331,555           332,748
Series 2551, Cl. FD, 2.803%, 1/15/33 3                265,555           267,375
Series 2551, Cl. TA, 4.50%, 2/15/18                   112,341           112,270
- -------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.,
Interest-Only Stripped Mtg.-Backed
Security:
Series 176, Cl. IO, (0.21)%, 6/1/26 5                 469,447            87,648
Series 183, Cl. IO, (1.41)%, 4/1/27 5                 761,669           147,670
Series 184, Cl. IO, 1.85%, 12/1/26 5                  773,660           143,863
Series 192, Cl. IO, 3.27%, 2/1/28 5                   209,537            38,940
Series 200, Cl. IO, 2.89%, 1/1/29 5                   256,034            49,086
Series 2130, Cl. SC, 12.38%, 3/15/29 5                576,012            60,173
Series 2796, Cl. SD, 19.10%, 7/15/26 5                795,040            80,364


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED Continued
Federal Home Loan Mortgage Corp.,
Principal-Only Stripped Mtg.-Backed
Security, Series 176, Cl. PO, 6.95%,
6/1/26 6                                      $       206,600   $       180,247
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.:
4.50%, 1/1/20 4                                     5,578,000         5,560,569
5%, 1/1/20-1/1/35 4                                22,693,000        22,586,331
5.50%, 3/1/33-1/1/34                                5,764,934         5,859,441
5.50%, 1/1/35 4                                    22,082,000        22,420,120
6%, 5/1/16-8/1/24                                   8,553,513         8,926,103
6%, 1/1/35 4                                       12,055,000        12,465,617
6.50%, 11/1/27-10/1/30                              1,359,313         1,429,034
6.50%, 1/1/35 4                                    15,978,000        16,756,928
7%, 12/1/31-10/1/34                                11,580,421        12,281,759
7%, 8/1/28-6/1/32 4                                 4,627,104         4,910,937
7.50%, 7/1/30-9/1/30                                1,082,094         1,159,793
8.50%, 7/1/32                                          56,581            61,468
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Collateralized Mtg. Obligations,
Trust 2002-T1, Cl. A2, 7%, 11/25/31                 1,561,930         1,656,130
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Collateralized Mtg. Obligations, Gtd.
Real Estate Mtg. Investment Conduit
Pass-Through Certificates:
Trust 1993-87, Cl. Z, 6.50%, 6/25/23                1,256,369         1,319,246
Trust 1998-63, Cl. PG, 6%, 3/25/27                    256,265           257,487
Trust 2001-50, Cl. NE, 6%, 8/25/30                    508,881           515,913
Trust 2001-70, Cl. LR, 6%, 9/25/30                    489,509           499,106
Trust 2001-72, Cl. NH, 6%, 4/25/30                    397,360           406,372
Trust 2001-74, Cl. PD, 6%, 5/25/30                    169,872           172,177
Trust 2002-50, Cl. PD, 6%, 9/25/27                    278,499           278,685
Trust 2002-77, Cl. WF, 2.81%, 12/18/32 3              426,467           428,987
Trust 2002-94, Cl. MA, 4.50%, 8/25/09                 737,669           739,285
Trust 2003-81, Cl. PA, 5%, 2/25/12                    221,314           222,127
Trust 2004-101, Cl. BG, 5%, 1/25/20                 1,110,000         1,119,713
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates,
Interest-Only Stripped Mtg.-Backed
Security:
Trust 319, Cl. 2, (3.08)%, 2/1/32 5                   469,725            90,287
Trust 2002-47, Cl. NS, 9.28%, 4/25/32 5             1,030,485           108,006
Trust 2002-51, Cl. S, 9.56%, 8/25/32 5                946,229            99,276
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Interest-Only Stripped Mtg.-Backed
Security:
Trust 222, Cl. 2, (2.53)%, 6/1/23 5                 1,519,204           283,050
Trust 233, Cl. 2, (0.80)%, 8/1/23 5                 1,435,014           265,601
Trust 240, Cl. 2, 0.11%, 9/1/23 5                   2,324,143           442,611
Trust 252, Cl. 2, (3.44)%, 11/1/23 5                1,161,785           228,219
Trust 254, Cl. 2, (0.11)%, 1/1/24 5                   584,942           120,874
Trust 273, Cl. 2, 0.09%, 7/1/26 5                     340,774            62,963
Trust 321, Cl. 2, (8.45)%, 3/1/32 5                 4,842,910           962,409
Trust 333, Cl. 2, 1.40%, 3/1/33 5                   4,696,785         1,015,778
Trust 334, Cl. 17, (16.18)%, 2/1/33 5                 777,496           155,868
Trust 2001-81, Cl. S, 13.68%, 1/25/32 5               482,978            58,907


            11 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED Continued
Federal National Mortgage Assn.,
Interest-Only Stripped Mtg.-Backed
Security: Continued
Trust 2002-52, Cl. SD, 8.85%, 9/25/32 5       $     1,191,233   $       123,167
Trust 2002-77, Cl. SH, 21.15%,
12/18/32 5                                            619,517            62,738
Trust 2002-9, Cl. MS, 10.62%, 3/25/32 5               703,195            76,703
Trust 2004-54, Cl. DS, 20.40%,
11/25/30 5                                            993,390            90,528
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Principal-Only Stripped Mtg.-Backed
Security, Trust 1993-184, Cl. M,
9.71%, 9/25/23 6                                      480,445           416,075
                                                                ---------------
                                                                    166,812,699

- -------------------------------------------------------------------------------
GNMA/GUARANTEED--0.1%
Government National Mortgage
Assn., 8%, 4/15/23                                    293,164           320,660
- -------------------------------------------------------------------------------
Government National Mortgage
Assn., Interest-Only Stripped
Mtg.-Backed Security:
Series 2001-21, Cl. SB, 14.94%,
1/16/27 5                                             920,135            88,003
Series 2002-15, Cl. SM, 9.39%,
2/16/32 5                                           1,047,287           100,973
Series 2002-76, Cl. SY, 9.35%,
12/16/26 5                                          2,108,379           215,071
Series 2004-11, Cl. SM, 10.64%,
1/17/30 5                                             835,059            75,086
                                                                ---------------
                                                                        799,793

- -------------------------------------------------------------------------------
PRIVATE--4.3%
- -------------------------------------------------------------------------------
COMMERCIAL--4.3%
Banc of America Commercial
Mortgage, Inc., Commercial Mtg.
Pass-Through Certificates, Series
2004-6, Cl. A3, 4.512%, 12/10/42                    1,000,000         1,000,000
- -------------------------------------------------------------------------------
Bank of America Mortgage Securities,
Inc., Collateralized Mtg. Obligations
Pass-Through Certificates:
Series 2004-2, Cl. 2A1, 6.50%,
7/20/32                                             1,636,692         1,672,129
Series 2004-8, Cl. 5A1, 6.50%,
5/25/32                                             1,275,323         1,325,141
Series 2004-E, Cl. 2A9, 3.712%,
6/25/34                                               931,642           932,230
Series 2004-G, Cl. 2A1, 2.469%,
8/25/34                                               622,321           621,094
- -------------------------------------------------------------------------------
Countrywide Alternative Loan
Trust, Collateralized Mtg. Obligations,
Series 2004-J9, Cl. 1A1, 2.598%,
10/25/34 3                                          1,299,747         1,301,242


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
COMMERCIAL Continued
First Union National Bank/Lehman
Brothers/Bank of America Commercial
Mtg. Trust, Pass-Through Certificates,
Series 1998-C2, Cl. A2, 6.56%,
11/18/35                                      $       680,000   $       731,518
- -------------------------------------------------------------------------------
General Motors Acceptance Corp.
Commercial Mtg. Securities, Inc.,
Commercial Mtg. Obligations, Series
2004-C3, Cl. A4, 4.547%, 12/10/41                     640,000           641,684
- -------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc., Mtg. Pass-Through
Certificates, Series 1997-C1, Cl. A3,
6.869%, 7/15/29                                       506,985           536,679
- -------------------------------------------------------------------------------
GS Mortgage Securities Corp. II,
Commercial Mtg. Pass-Through
Certificates:
Series 2004-C1, Cl. A1, 3.659%,
10/10/28                                              685,259           677,810
Series 2004-GG2, Cl. A3, 4.602%,
8/10/38                                               410,000           418,316
- -------------------------------------------------------------------------------
GSR Mortgage Loan Trust,
Collateralized Mtg. Obligations,
Series 04-12, Cl. 3A1, 4.593%, 12/25/34 2,3         2,018,542         2,021,322
- -------------------------------------------------------------------------------
Mastr Alternative Loan Trust,
Pass-Through Collateralized Mtg.
Obligations, Series 2004-6, Cl. 10A1,
6%, 7/25/34                                         1,893,011         1,954,708
- -------------------------------------------------------------------------------
Mastr Asset Securitization Trust,
Pass-Through Collateralized Mtg.
Obligations, Series 2004-9, Cl. A3,
4.70%, 8/25/34                                      2,476,850         2,478,856
- -------------------------------------------------------------------------------
Mastr Seasoned Securities Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. PT65, 6.50%,
12/1/34 4                                           2,966,000         3,054,517
- -------------------------------------------------------------------------------
Nomura Asset Securities Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1998-D6, Cl. A1B,
6.59%, 3/15/30                                        780,000           844,183
- -------------------------------------------------------------------------------
Prudential Mortgage Capital Co. II
LLC, Commercial Mtg. Pass-Through
Certificates, Series PRU-HTG 2000-C1,
Cl. A2, 7.306%, 10/6/15                               983,000         1,133,147
- -------------------------------------------------------------------------------
Washington Mutual Mortgage
Securities Corp., Collateralized Mtg.
Pass-Through Certificates, Series
2003-AR12, Cl. A2, 2.446%, 2/25/34 3                   16,547            16,556


            12 | OPPENHEIMER BALANCED FUND/VA


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
COMMERICIAL Continued
Wells Fargo Mortgage-Backed
Securities Trust, Collateralized Mtg.
Obligations:
Series 2004-DD, Cl. 2A1,
4.548%, 1/25/35                               $     2,260,000   $     2,263,708
Series 2004-N, Cl. A10, 3.803%,
8/25/34 2                                           1,652,090         1,657,524
Series 2004-W, Cl. A2, 4.635%,
11/25/34 3                                            948,941           951,560
                                                                ---------------
                                                                     26,233,924

- -------------------------------------------------------------------------------
OTHER--0.0%
CIT Equipment Collateral, Equipment
Receivable-Backed Nts., Series
2003-EF1, Cl. A2, 1.49%, 12/20/05                      77,989            78,005
                                                                ---------------
Total Mortgage-Backed Obligations
(Cost $193,402,123)                                                 193,924,421

- -------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS--6.6%
- -------------------------------------------------------------------------------
Federal Home Loan Bank Bonds,
3.125%, 9/15/06                                     2,155,000         2,153,636
- -------------------------------------------------------------------------------
Federal Home Loan Bank Unsec.
Bonds, 2.75%, 10/15/06                              2,540,000         2,520,993
- -------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp. Unsec. Nts., 6.875%, 9/15/10                  1,500,000         1,714,446
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.
Unsec. Nts.:
4.25%, 7/15/07                                      4,315,000         4,408,066
7.25%, 1/15/10-5/15/30                              4,075,000         4,790,855
- -------------------------------------------------------------------------------
Tennessee Valley Authority Bonds:
7.125%, 5/1/30                                        795,000           992,111
Series A, 6.79%, 5/23/12                            7,916,000         9,128,446
- -------------------------------------------------------------------------------
U.S. Treasury Bonds:
5.375%, 2/15/31                                     2,197,000         2,376,365
5.50%, 8/15/28                                        645,000           698,314
STRIPS, 3.37%, 2/15/11 7                              409,000           322,164
STRIPS, 3.86%, 2/15/13 7                              478,000           340,039
- -------------------------------------------------------------------------------
U.S. Treasury Nts.:
2.50%, 9/30/06-10/31/06                             8,960,000         8,882,683
4.25%, 11/15/13-11/15/14                            1,538,000         1,546,678
5.75%, 8/15/10                                        434,000           477,960
                                                                ---------------

Total U.S. Government Obligations
(Cost $40,249,219)                                                   40,352,756

- -------------------------------------------------------------------------------
FOREIGN GOVERNMENT OBLIGATIONS--0.1%
- -------------------------------------------------------------------------------
United Mexican States Nts., 7.50%,
1/14/12 (Cost $520,726)                               475,000           539,838
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND
NOTES--13.2%
ABN Amro Bank NV (NY Branch),
7.125% Sub. Nts., Series B, 10/15/93                  400,000   $       461,950
- -------------------------------------------------------------------------------


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES Continued
Aetna, Inc., 7.375% Sr. Unsec. Nts., 3/1/06   $     1,185,000   $     1,233,951
- -------------------------------------------------------------------------------
Allied Waste North America, Inc.,
8.875% Sr. Nts., Series B, 4/1/08                     540,000           580,500
- -------------------------------------------------------------------------------
Allstate Financial Global Funding
LLC, 4.25% Nts., 9/10/08 9                            245,000           248,094
- -------------------------------------------------------------------------------
Allstate Life Global Funding II,
3.50% Nts., 7/30/07                                   330,000           328,808
- -------------------------------------------------------------------------------
American Express Centurion Bank,
4.375% Nts., 7/30/09                                  435,000           442,381
- -------------------------------------------------------------------------------
American Honda Finance Corp.,
3.85% Nts., 11/6/08 9                                 835,000           833,408
- -------------------------------------------------------------------------------
AT&T Wireless Services, Inc.,
7.50% Sr. Unsec. Nts., 5/1/07                         885,000           961,767
- -------------------------------------------------------------------------------
AXA, 8.60% Unsec. Sub. Nts., 12/15/30                 750,000           987,984
- -------------------------------------------------------------------------------
Bank of America Corp.:
4.875% Sr. Unsec. Nts., 1/15/13                        15,000            15,286
7.80% Jr. Unsec. Sub. Nts., 2/15/10                   400,000           465,659
- -------------------------------------------------------------------------------
Bankers Trust Corp., 7.375%
Unsec. Sub. Nts., 5/1/08                              100,000           111,007
- -------------------------------------------------------------------------------
Beazer Homes USA, Inc., 8.625%
Sr. Unsec. Nts., 5/15/11                              565,000           618,675
- -------------------------------------------------------------------------------
Boeing Capital Corp.:
5.65% Sr. Unsec. Nts., 5/15/06                        180,000           185,670
6.50% Nts., 2/15/12  10                               750,000           841,571
- -------------------------------------------------------------------------------
British Telecommunications plc:
7.875% Nts., 12/15/05                                 770,000           803,285
8.125% Nts., 12/15/10                                 420,000           504,968
- -------------------------------------------------------------------------------
Canadian National Railway Co.,
4.25% Nts., 8/1/09                                    161,000           162,448
- -------------------------------------------------------------------------------
CenterPoint Energy, Inc.:
5.875% Sr. Nts., 6/1/08                               690,000           722,564
8.125% Unsec. Nts., Series B, 7/15/05                 270,000           277,148
- -------------------------------------------------------------------------------
Chancellor Media CCU, 8% Sr.
Unsec. Nts., 11/1/08                                1,155,000         1,297,895
- -------------------------------------------------------------------------------
Chesapeake Energy Corp., 7.50%
Sr. Nts., 6/15/14                                     610,000           669,475
- -------------------------------------------------------------------------------
CIGNA Corp., 7.40% Unsec. Nts.,
5/15/07                                             1,410,000         1,515,619
- -------------------------------------------------------------------------------
CIT Group, Inc., 7.75% Sr. Unsec.
Unsub. Nts., 4/2/12                                 1,000,000         1,185,388
- -------------------------------------------------------------------------------
Citigroup, Inc., 6.875% Unsec. Nts.,
2/15/98                                               450,000           514,893
- -------------------------------------------------------------------------------
Citizens Communications Co.,
9.25% Sr. Nts., 5/15/11                               291,000           341,925
- -------------------------------------------------------------------------------
Coca-Cola Co. (The), 7.375%
Unsec. Debs., 7/29/93                                 360,000           457,509
- -------------------------------------------------------------------------------
ConAgra Foods, Inc., 6% Nts.,
9/15/06                                               610,000           635,388
- -------------------------------------------------------------------------------
Conectiv, Inc., 5.30% Unsec. Unsub.
Nts., Series B, 6/1/05                                168,000           169,381


            13 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES Continued
Cox Communications, Inc., 7.875%
Unsec. Nts., 8/15/09                          $       760,000   $       863,431
- -------------------------------------------------------------------------------
CSX Corp., 6.25% Unsec. Nts.,
10/15/08                                              585,000           631,265
- -------------------------------------------------------------------------------
D.R. Horton, Inc., 6.125% Nts.,
1/15/14                                               555,000           574,425
- -------------------------------------------------------------------------------
DaimlerChrysler North America
Holding Corp., 4.75% Unsec. Nts.,
1/15/08                                             1,090,000         1,114,053
- -------------------------------------------------------------------------------
Delphi Automotive Systems Corp.,
6.50% Nts., 5/1/09                                    500,000           514,400
- -------------------------------------------------------------------------------
Deutsche Telekom International
Finance BV, 8.50% Unsub. Nts.,
6/15/10                                               770,000           918,381
- -------------------------------------------------------------------------------
Dominion Resources, Inc., 8.125%
Sr. Unsub. Nts., 6/15/10                              530,000           624,528
- -------------------------------------------------------------------------------
DTE Energy Co., 6.45% Sr. Unsub.
Nts., 6/1/06                                          580,000           603,983
- -------------------------------------------------------------------------------
Duke Capital LLC, 5.668% Nts.,
8/15/14                                               645,000           666,774
- -------------------------------------------------------------------------------
EOP Operating LP:
6.763% Sr. Unsec. Nts., 6/15/07                       180,000           191,591
8.375% Nts., 3/15/06                                  425,000           448,405
- -------------------------------------------------------------------------------
Federated Department Stores, Inc.,
6.625% Sr. Unsec. Nts., 9/1/08                        810,000           882,514
- -------------------------------------------------------------------------------
FedEx Corp., 2.65% Unsec. Nts.,
4/1/07                                              1,320,000         1,293,538
- -------------------------------------------------------------------------------
FirstEnergy Corp.:
5.50% Sr. Unsub. Nts., Series A,
11/15/06                                              495,000           511,228
7.375% Sr. Unsub. Nts., Series C,
11/15/31                                              565,000           647,246
- -------------------------------------------------------------------------------
Food Lion, Inc., 7.55% Nts., 4/15/07                  785,000           852,939
- -------------------------------------------------------------------------------
Ford Holdings, Inc., 9.30% Unsec.
Unsub. Debs., 3/1/30                                  240,000           282,218
- -------------------------------------------------------------------------------
Ford Motor Co., 7.70% Unsec.
Debs., 5/15/97                                        400,000           387,614
- -------------------------------------------------------------------------------
Ford Motor Credit Co., 7.375%
Nts., 10/28/09                                        255,000           275,339
- -------------------------------------------------------------------------------
France Telecom SA:
7.95% Sr. Unsec. Nts., 3/1/06                         115,000           120,779
8.50% Sr. Unsec. Nts., 3/1/11                         540,000           644,961
9.25% Sr. Unsec. Nts., 3/1/31 3                       230,000           312,708
- -------------------------------------------------------------------------------
Franklin Resources, Inc., 3.70% Nts.,
4/15/08                                               425,000           424,320
- -------------------------------------------------------------------------------
Gap, Inc. (The):
6.90% Nts., 9/15/07 2                                 354,000           382,320
10.55% Unsub. Nts., 12/15/08                          141,000           172,373
- -------------------------------------------------------------------------------
General Electric Capital Corp.,
7.25% Nts., Series A, 2/1/05                          400,000           401,310
- -------------------------------------------------------------------------------
General Mills, Inc., 3.875% Nts.,
11/30/07                                              950,000           953,687


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES Continued
General Motors Acceptance Corp.,
7.25% Nts., 3/2/11                            $     1,660,000   $     1,740,108
- -------------------------------------------------------------------------------
General Motors Corp., 8.375% Sr.
Unsec. Debs., 7/15/33                                 280,000           290,907
- -------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The),
7.80% Sr. Unsec. Unsub. Nts.,
Series B, 1/28/10                                     400,000           462,792
- -------------------------------------------------------------------------------
Hartford Financial Services Group,
Inc. (The), 2.375% Nts., 6/1/06                       345,000           338,808
- -------------------------------------------------------------------------------
Hertz Corp. (The), 6.35% Nts.,
6/15/10                                             1,560,000         1,600,650
- -------------------------------------------------------------------------------
Hilton Hotels Corp., 7.95% Sr. Nts.,
4/15/07                                               450,000           489,713
- -------------------------------------------------------------------------------
Household Finance Corp., 8.875%
Sr. Unsec. Nts., 2/15/06                              830,000           878,858
- -------------------------------------------------------------------------------
Huntsman Corp./ICI Chemical Co.
plc, 13.08% Sr. Unsec. Disc. Nts.,
12/31/09 7                                            500,000           282,500
- -------------------------------------------------------------------------------
Hutchison Whampoa International
Ltd., 7.45% Sr. Bonds, 11/24/33 9                     495,000           550,726
- -------------------------------------------------------------------------------
IPALCO Enterprises, Inc., 8.375% Sr.
Sec. Nts., 11/14/08 2,3                               540,000           610,200
- -------------------------------------------------------------------------------
iStar Financial, Inc.:
4.875% Sr. Unsec. Nts., Series B,
1/15/09                                               545,000           553,687
8.75% Sr. Unsec. Nts., 8/15/08                        400,000           456,487
- -------------------------------------------------------------------------------
J.C. Penney Co., Inc., 8% Nts., 3/1/10              1,160,000         1,331,100
- -------------------------------------------------------------------------------
John Hancock Global Funding II,
7.90% Nts., 7/2/10 9                                  947,000         1,110,079
- -------------------------------------------------------------------------------
Kaiser Aluminum & Chemical Corp.,
10.875% Sr. Nts., Series B, 10/15/06 1,11             250,000           221,875
- -------------------------------------------------------------------------------
Kinder Morgan, Inc., 6.50% Sr. Unsec.
Nts., 9/1/12                                          595,000           655,005
- -------------------------------------------------------------------------------
Kraft Foods, Inc., 5.25% Nts., 6/1/07               1,435,000         1,487,320
- -------------------------------------------------------------------------------
Kroger Co. (The), 7.80% Sr. Nts.,
8/15/07                                               905,000           993,094
- -------------------------------------------------------------------------------
Lear Corp., 8.11% Sr. Unsec. Nts.,
Series B, 5/15/09                                   1,000,000         1,135,205
- -------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.,
7% Nts., 2/1/08                                       765,000           836,410
- -------------------------------------------------------------------------------
Lehman Brothers, Inc., 6.625% Sr.
Sub. Nts., 2/15/08                                    125,000           135,056
- -------------------------------------------------------------------------------
Lennar Corp., 5.95% Sr. Unsec. Nts.,
3/1/13                                                580,000           615,214
- -------------------------------------------------------------------------------
Liberty Media Corp., 3.50% Nts.,
9/25/06                                               600,000           596,913
- -------------------------------------------------------------------------------
Liberty Property Trust, 5.65% Sr.
Nts., 8/15/14                                         615,000           633,055
- -------------------------------------------------------------------------------
Marsh & McLennan Cos., Inc.,
5.375% Nts., 7/15/14                                  268,000           262,334


            14 | OPPENHEIMER BALANCED FUND/VA


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES Continued
May Department Stores Co., 3.95%
Nts., 7/15/07                                 $        81,000   $        81,185
- -------------------------------------------------------------------------------
MBNA America Bank NA, 5.375%
Nts., 1/15/08                                         935,000           977,229
- -------------------------------------------------------------------------------
McDonnell Douglas Corp., 6.875%
Unsec. Unsub. Nts., 11/1/06                           160,000           169,432
- -------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 4.125%
Nts., 9/10/09                                       1,280,000         1,280,475
- -------------------------------------------------------------------------------
Metallurg, Inc., 11% Sr. Nts., 12/1/07                450,000           393,750
- -------------------------------------------------------------------------------
Morgan Stanley, 6.60% Nts., 4/1/12                    570,000           636,656
- -------------------------------------------------------------------------------
National City Bank, 6.20% Sub.
Nts., 12/15/11                                         83,000            91,376
- -------------------------------------------------------------------------------
NiSource Finance Corp.:
3.20% Nts., 11/1/06                                   180,000           178,462
7.875% Sr. Unsec. Nts., 11/15/10                      790,000           929,821
- -------------------------------------------------------------------------------
Northrop Grumman Corp., 7.125%
Sr. Nts., 2/15/11                                     767,000           881,327
- -------------------------------------------------------------------------------
Petroleos Mexicanos, 9.50% Sr. Sub.
Nts., 9/15/27                                         365,000           458,988
- -------------------------------------------------------------------------------
PF Export Receivables Master Trust,
3.748% Sr. Nts., Series B, 6/1/13 9                   424,641           412,316
- -------------------------------------------------------------------------------
Prudential Holdings LLC, 8.695%
Bonds, Series C, 12/18/23 9                           900,000         1,145,817
- -------------------------------------------------------------------------------
Prudential Insurance Co. of America,
8.30% Nts., 7/1/25 9                                  920,000         1,178,061
- -------------------------------------------------------------------------------
PSEG Energy Holdings LLC, 7.75%
Unsec. Nts., 4/16/07 2                                595,000           632,188
- -------------------------------------------------------------------------------
R&B Falcon Corp., 9.50% Sr. Unsec.
Nts., 12/15/08                                        500,000           593,204
- -------------------------------------------------------------------------------
Raytheon Co., 6.50% Unsec. Nts.,
7/15/05                                               225,000           229,049
- -------------------------------------------------------------------------------
Safeway, Inc., 4.80% Sr. Unsec. Nts.,
7/16/07                                             1,445,000         1,480,099
- -------------------------------------------------------------------------------
Spieker Properties LP, 6.75%
Unsec. Unsub. Nts., 1/15/08                           360,000           390,458
- -------------------------------------------------------------------------------
Sprint Capital Corp.:
7.125% Sr. Unsec. Nts., 1/30/06                       595,000           619,028
8.75% Nts., 3/15/32                                   530,000           708,297
- -------------------------------------------------------------------------------
Starwood Hotels & Resorts
Worldwide, Inc., 7.375% Nts., 5/1/07                  470,000           503,488
- -------------------------------------------------------------------------------
Sterling Chemicals, Inc., 10% Sr.
Sec. Nts., 12/19/07 8                                 221,615           222,723
- -------------------------------------------------------------------------------
SunTrust Banks, Inc.:
4% Nts., 10/15/08                                     640,000           646,461
7.75% Unsec. Sub. Nts., 5/1/10                         57,000            66,275
- -------------------------------------------------------------------------------
TCI Communications, Inc., 9.80%
Sr. Unsec. Debs., 2/1/12                            1,145,000         1,477,881
- -------------------------------------------------------------------------------
TECO Energy, Inc., 10.50% Sr.
Unsec. Nts., 12/1/07                                  475,000           549,805


                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES Continued
Telefonos de Mexico SA de CV,
4.50% Nts., 11/19/08                          $       530,000   $       534,857
- -------------------------------------------------------------------------------
Time Warner Cos., Inc., 9.125%
Debs., 1/15/13                                        530,000           682,359
- -------------------------------------------------------------------------------
Time Warner Entertainment Co. LP,
10.15% Sr. Nts., 5/1/12                               500,000           656,851
- -------------------------------------------------------------------------------
Toll Corp., 8.25% Sr. Sub. Nts., 12/1/11              565,000           627,150
- -------------------------------------------------------------------------------
TXU Corp., 4.80% Nts., 11/15/09 9                     555,000           556,591
- -------------------------------------------------------------------------------
Tyco International Group SA:
6.375% Sr. Unsec. Unsub. Nts.,
2/15/06                                               850,000           878,557
6.375% Nts., 10/15/11                                 750,000           829,192
6.75% Sr. Unsub. Nts., 2/15/11                        378,000           424,194
- -------------------------------------------------------------------------------
Univision Communications, Inc.:
2.875% Sr. Unsec. Nts., 10/15/06                      163,000           160,910
3.50% Sr. Unsec. Nts., 10/15/07                       845,000           835,577
- -------------------------------------------------------------------------------
Volkswagen Credit, Inc., 2.33% Nts.,
7/21/05  3,9                                        1,225,000         1,225,103
- -------------------------------------------------------------------------------
Vornado Realty LP, 5.625% Sr. Unsec.
Unsub. Nts., 6/15/07                                1,225,000         1,272,553
- -------------------------------------------------------------------------------
Waste Management, Inc.:
7% Sr. Nts., 7/15/28                                  220,000           248,893
7.125% Sr. Unsec. Nts., 10/1/07                       800,000           869,420
- -------------------------------------------------------------------------------
Western Forest Products, Inc.,
15% Sec. Nts., 7/28/09 8,9                            146,000           165,345
- -------------------------------------------------------------------------------
Weyerhaeuser Co., 5.50% Unsec.
Unsub. Nts., 3/15/05                                  250,000           251,163
- -------------------------------------------------------------------------------
Yum! Brands, Inc., 8.50% Sr. Unsec.
Nts., 4/15/06                                       1,230,000         1,307,014
                                                                ---------------
Total Non-Convertible Corporate
Bonds and Notes (Cost $77,208,011)                                   79,998,603

- -------------------------------------------------------------------------------
STRUCTURED NOTES--0.6%
- -------------------------------------------------------------------------------
Deutsche Bank AG, COUNTS Corp.
Sec. Credit Linked Nts., Series 2003-1,
3.78%, 1/7/05 2,3 (Cost $3,550,000)                 3,550,000         3,539,350
- -------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--5.9%
- -------------------------------------------------------------------------------
Undivided interest of 2.49% in joint
repurchase agreement (Principal Amount/Value
$1,443,703,000, with a maturity value of
$1,443,962,867) with UBS Warburg LLC, 2.16%,
dated 12/31/04, to be repurchased at
$36,015,482 on 1/3/05, collateralized by
Federal National Mortgage Assn., 5%--6%,
4/1/34--10/1/34, with a value of
$1,474,609,071 (Cost $36,009,000)                  36,009,000        36,009,000
- -------------------------------------------------------------------------------
Total Investments, at Value (excluding
Investments Purchased with Cash
Collateral from Securities Loaned)
(Cost $609,300,383)                                                 707,716,968


            15 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                    PRINCIPAL             VALUE
                                                       AMOUNT        SEE NOTE 1
- -------------------------------------------------------------------------------
INVESTMENTS PURCHASED WITH CASH COLLATERAL
FROM SECURITIES LOANED--2.0%
- -------------------------------------------------------------------------------
MASTER FLOATING NOTES--0.2%
Bear Stearns, 2.493%, 1/3/05 12                   $   500,000   $       500,000
- -------------------------------------------------------------------------------
Merrill Lynch Mortgage Capital,
2.413%, 1/3/05 12                                     500,000           500,000
                                                                ---------------
                                                                      1,000,000

- -------------------------------------------------------------------------------
REPURCHASE AGREEMENT--1.8%
Undivided interest of 0.39% in joint repurchase
agreement (Principal Amount/Value $2,800,000,000,
with a maturity value of $2,800,550,669) with
Nomura Securities, 2.36%, dated 12/31/04, to
be repurchased at $10,968,169 on 1/3/05,
collateralized by U.S. Government Mortgage
Agencies, 2.58%-7.50%, 1/15/08-10/15/44,
with a value of $2,908,566,289 12                  10,966,012        10,966,012
                                                                ---------------
Total Investments Purchased with
Cash Collateral from Securities
Loaned (Cost $11,966,012)                                            11,966,012

- -------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $621,266,395)                                     118.6%      719,682,980
- -------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS                   (18.6)     (112,742,772)
                                              ---------------------------------
NET ASSETS                                              100.0%  $   606,940,208
                                              =================================

FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. Illiquid security. The aggregate value of illiquid securities as of December
31, 2004 was $13,118,632, which represents 2.16% of the Fund's net assets. See
Note 9 of Notes to Financial Statements.

3. Represents the current interest rate for a variable or increasing rate
security.

4. When-issued security or forward commitment to be delivered and settled after
December 31, 2004. See Note 1 of Notes to Financial Statements.

5. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows. These securities amount to $5,333,862 or 0.88% of the Fund's net assets
as of December 31, 2004.

6. Principal-Only Strips represent the right to receive the monthly principal
payments on an underlying pool of mortgage loans. The value of these securities
generally increases as interest rates decline and prepayment rates rise. The
price of these securities is typically more volatile than that of coupon-bearing
bonds of the same maturity. Interest rates disclosed represent current yields
based upon the current cost basis and estimated timing of future cash flows.
These securities amount to $596,322 or 0.10% of the Fund's net assets as of
December 31, 2004.

7. Zero coupon bond reflects effective yield on the date of purchase.

8. Interest or dividend is paid-in-kind.

9. 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 $7,425,540 or 1.22% of the Fund's net
assets as of December 31, 2004.

10. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts with an aggregate
market value of $785,467. See Note 6 of Notes to Financial Statements.

11. Issue is in default. See Note 1 of Notes to Financial Statements.

12. The security has been segregated to satisfy the forward commitment to return
the cash collateral received in securities lending transactions upon the
borrower's return of the securities loaned. See Note 10 of Notes to Financial
Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            16 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investments, at value (including securities loaned of
$32,538,035) (cost $621,266,395)--see accompanying
statement of investments                                        $   719,682,980
- --------------------------------------------------------------------------------
Cash                                                                    752,712
- --------------------------------------------------------------------------------
Collateral for securities loaned                                     21,172,558
- --------------------------------------------------------------------------------
Unrealized appreciation on swap contracts                                39,477
- --------------------------------------------------------------------------------
Receivables and other assets:
Investments sold on a when-issued basis or forward commitment        34,157,333
Interest, dividends and principal paydowns                            2,698,161
Futures margins                                                         171,264
Shares of beneficial interest sold                                      160,472
Other                                                                     9,836
                                                                ----------------
Total assets                                                        778,844,793

- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Return of collateral for securities loaned                           33,138,570
- --------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased (including $138,238,645 purchased on a
when-issued basis or forward commitment)                            138,452,752
Shares of beneficial interest redeemed                                  202,423
Shareholder communications                                               35,195
Distribution and service plan fees                                       33,267
Trustees' compensation                                                   13,840
Transfer and shareholder servicing agent fees                             1,709
Other                                                                    26,829
                                                                ----------------
Total liabilities                                                   171,904,585

- --------------------------------------------------------------------------------
NET ASSETS                                                      $   606,940,208
                                                                ================

- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- --------------------------------------------------------------------------------
Par value of shares of beneficial interest                      $        34,997
- --------------------------------------------------------------------------------
Additional paid-in capital                                          477,924,685
- --------------------------------------------------------------------------------
Accumulated net investment income                                     9,981,717
- --------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign
currency transactions                                                20,056,825
- --------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of
assets and liabilities denominated in foreign currencies             98,941,984
                                                                ----------------
NET ASSETS                                                      $   606,940,208
                                                                ================

- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- --------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering
price per share (based on net assets of $547,290,257
and 31,542,247 shares of beneficial interest outstanding)       $         17.35
- --------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering
price per share (based on net assets of $59,649,951
and 3,455,362 shares of beneficial interest outstanding)        $         17.26

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            17 | OPPENHEIMER BALANCED FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Interest                                                        $     8,070,767
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $92,103)               5,180,617
- --------------------------------------------------------------------------------
Portfolio lending fees                                                   28,817
                                                                ----------------
Total investment income                                              13,280,201

- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees                                                       4,101,747
- --------------------------------------------------------------------------------
Distribution and service plan fees -- Service shares                     99,391
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                       10,110
Service shares                                                           10,010
- --------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                       34,192
Service shares                                                            2,425
- --------------------------------------------------------------------------------
Custodian fees and expenses                                              20,673
- --------------------------------------------------------------------------------
Trustees' compensation                                                   17,269
- --------------------------------------------------------------------------------
Other                                                                    40,636
                                                                ----------------
Total expenses                                                        4,336,453
Less reduction to custodian expenses                                    (13,820)
                                                                ----------------
Net expenses                                                          4,322,633

- --------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                 8,957,568

- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain on:
Investments (including premiums on options exercised)                50,334,810
Closing of futures contracts                                          1,583,889
Closing and expiration of option contracts written                      331,434
Foreign currency transactions                                           197,105
Swap contracts                                                          229,352
Net increase from payment by affiliate                                   13,067
                                                                ----------------
Net realized gain                                                    52,689,657
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                          (6,627,575)
Translation of assets and liabilities denominated in
foreign currencies                                                      340,324
Futures contracts                                                        (4,983)
Option contracts                                                        249,912
Swap contracts                                                           31,513
                                                                ----------------
Net change in unrealized appreciation                                (6,010,809)

- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS            $    55,636,416
                                                                ================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            18 | OPPENHEIMER BALANCED FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

YEAR ENDED DECEMBER 31,                                                 2004              2003
- -----------------------------------------------------------------------------------------------

OPERATIONS
- -----------------------------------------------------------------------------------------------
Net investment income                                         $    8,957,568    $    8,796,089
- -----------------------------------------------------------------------------------------------
Net realized gain                                                 52,689,657         1,352,031
- -----------------------------------------------------------------------------------------------
Net change in unrealized appreciation                             (6,010,809)       99,178,424
                                                              ---------------------------------
Net increase in net assets resulting from operations              55,636,416       109,326,544

- -----------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- -----------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                (5,486,430)      (13,791,025)
Service shares                                                      (294,219)          (86,954)

- -----------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- -----------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
beneficial interest transactions:
Non-Service shares                                               (31,808,087)      (18,122,603)
Service shares                                                    29,880,516        20,531,465

- -----------------------------------------------------------------------------------------------
NET ASSETS
- -----------------------------------------------------------------------------------------------
Total increase                                                    47,928,196        97,857,427
- -----------------------------------------------------------------------------------------------
Beginning of period                                              559,012,012       461,154,585
                                                              ---------------------------------
End of period (including accumulated net investment income
of $9,981,717 and $5,770,535, respectively)                   $  606,940,208    $  559,012,012
                                                              =================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            19 | OPPENHEIMER BALANCED FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                     2004           2003           2002           2001           2000
- -----------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $       15.92     $    13.16     $    15.40     $    16.55     $    17.46
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                            .26 1          .27            .50            .53            .72
Net realized and unrealized gain (loss)                         1.33           2.90          (2.02)          (.19)           .38
                                                       ----------------------------------------------------------------------------
Total from investment operations                                1.59           3.17          (1.52)           .34           1.10
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                            (.16)          (.41)          (.51)          (.64)          (.82)
Distributions from net realized gain                              --             --           (.21)          (.85)         (1.19)
                                                       ----------------------------------------------------------------------------
Total dividends and/or distributions to shareholders            (.16)          (.41)          (.72)         (1.49)         (2.01)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $       17.35     $    15.92     $    13.16     $    15.40     $    16.55
                                                       ============================================================================

- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                             10.10%         24.96%        (10.40)%         2.22%          6.44%
- -----------------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $     547,290     $  533,710     $  458,848     $  593,033     $  589,298
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $     528,655     $  475,389     $  517,516     $  599,324     $  566,724
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                           1.59%          1.82%          3.31%          3.42%          4.36%
Total expenses                                                  0.74% 4        0.76% 4        0.74% 4        0.76% 4        0.76% 4
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                           68% 5         248%            42%            30%            42%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

5. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$1,460,076,994 and $1,473,590,963, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            20 | OPPENHEIMER BALANCED FUND/VA


SERVICE SHARES  YEAR ENDED DECEMBER 31,                       2004           2003        2002 1
- --------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $     15.87     $    13.14     $   14.51
- --------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                          .23 2          .39           .13
Net realized and unrealized gain (loss)                       1.31           2.74         (1.50)
                                                       -------------------------------------------
Total from investment operations                              1.54           3.13         (1.37)
- --------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                          (.15)          (.40)           --
Distributions from net realized gain                            --             --            --
                                                       -------------------------------------------
Total dividends and/or distributions to shareholders          (.15)          (.40)           --
- --------------------------------------------------------------------------------------------------
Net asset value, end of period                         $     17.26     $    15.87     $   13.14
                                                       ===========================================

- --------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3                            9.79%         24.69%        (9.44)%
- --------------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $    59,650     $   25,302     $   2,306
- --------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $    39,851     $    9,908     $   1,037
- --------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                         1.41%          1.37%         3.30%
Total expenses                                                1.02% 5        1.01% 5       0.99% 5
- --------------------------------------------------------------------------------------------------
Portfolio turnover rate                                         68% 6         248%           42%


1. For the period from May 1, 2002 (inception of offering) to December 31, 2002.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

6. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$1,460,076,994 and $1,473,590,963, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            21 | OPPENHEIMER BALANCED FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Balanced Fund/VA (the Fund), formerly Oppenheimer Multiple
Strategies Fund/VA, is a separate series of Oppenheimer Variable Account Funds
(the Trust), an open-end management investment company registered under the
Investment Company Act of 1940, as amended. The Fund's investment objective is
to seek a high total investment return, which includes current income and
capital appreciation in the value of its shares. The Trust's investment advisor
is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
STRUCTURED NOTES. The Fund invests in structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss when
a structured note is sold or matures. As of December 31, 2004, the market value
of these securities comprised 0.6% of the Fund's net assets and resulted in
unrealized cumulative losses of $10,650.


            22 | OPPENHEIMER BALANCED FUND/VA


- --------------------------------------------------------------------------------
SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment
for securities that have been purchased by the Fund on a when-issued basis or
forward commitment can take place up to ten days or more after the trade date.
Normally the settlement date occurs within six months after the trade date;
however, the Fund may, from time to time, purchase securities whose settlement
date extends six months or more beyond trade date. During this period, such
securities do not earn interest, are subject to market fluctuation and may
increase or decrease in value prior to their delivery. The Fund maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The purchase of securities on a when-issued
basis or forward commitment may increase the volatility of the Fund's net asset
value to the extent the Fund executes such transactions while remaining
substantially fully invested. The Fund may also sell securities that it
purchased on a when-issued basis or forward commitment prior to settlement of
the original purchase. As of December 31, 2004, the Fund had purchased
$138,238,645 of securities on a when-issued basis or forward commitment and sold
$34,157,333 of securities issued on a when-issued basis or forward commitment.

      In connection with its ability to purchase or sell securities on a
when-issued basis, the Fund may enter into forward roll transactions with
respect to mortgage-related securities. Forward roll transactions require the
sale of securities for delivery in the current month, and a simultaneous
agreement with the same counterparty to repurchase similar (same type, coupon
and maturity) but not identical securities on a specified future date. The Fund
records the incremental difference between the forward purchase and sale of each
forward roll as realized gain (loss) on investments or as fee income in the case
of such transactions that have an associated fee in lieu of a difference in the
forward purchase and sale price.

      Risks of entering into forward roll transactions include the potential
inability of the counterparty to meet the terms of the agreement; the potential
of the Fund to receive inferior securities at redelivery as compared to the
securities sold to the counterparty; counterparty credit risk; and the potential
pay down speed variance between the mortgage-related pools.

- --------------------------------------------------------------------------------
SECURITY CREDIT RISK. The Fund invests in high-yield securities, which may be
subject to a greater degree of credit risk, market fluctuations and loss of
income and principal, and may be more sensitive to economic conditions than
lower-yielding, higher-rated fixed-income securities. The Fund may acquire
securities in default, and is not obligated to dispose of securities whose
issuers subsequently default. As of December 31, 2004, securities with an
aggregate market value of $221,875, representing 0.04% of the Fund's net assets,
were in default.

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.


            23 | OPPENHEIMER BALANCED FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                                  NET UNREALIZED
                                                              APPRECIATION BASED
   UNDISTRIBUTED                                           ON COST OF SECURITIES
   NET             UNDISTRIBUTED          ACCUMULATED      AND OTHER INVESTMENTS
   INVESTMENT          LONG-TERM                 LOSS         FOR FEDERAL INCOME
   INCOME                   GAIN   CARRYFORWARD 1,2,3               TAX PURPOSES
   -----------------------------------------------------------------------------
   $10,362,511       $21,392,409             $803,612                $98,038,867

1. The Fund had $803,612 of straddle losses which were deferred.

2. During the fiscal year ended December 31, 2004, the Fund utilized $28,540,378
of capital loss carryforward to offset capital gains realized in that fiscal
year.

3. During the fiscal year ended December 31, 2003, the Fund did not utilize any
capital loss carryforward.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

                                                        REDUCTION TO
                                INCREASE TO          ACCUMULATED NET
   INCREASE TO              ACCUMULATED NET            REALIZED GAIN
   PAID-IN CAPITAL        INVESTMENT INCOME         ON INVESTMENTS 4
   -----------------------------------------------------------------
   $1,654,641                    $1,034,263               $2,688,904

4. $1,654,641, all of which was long-term capital gain, was distributed in
connection with Fund share redemptions.

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                          YEAR ENDED          YEAR ENDED
                                   DECEMBER 31, 2004   DECEMBER 31, 2003
   ---------------------------------------------------------------------
   Distributions paid from:
   Ordinary income                        $5,780,649         $13,877,979


            24 | OPPENHEIMER BALANCED FUND/VA


The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

        Federal tax cost of securities              $ 621,634,306
        Federal tax cost of other investments         (16,548,740)
                                                    --------------
        Total federal tax cost                      $ 605,085,566
                                                    ==============

        Gross unrealized appreciation               $ 105,187,798
        Gross unrealized depreciation                  (7,148,931)
                                                    --------------
        Net unrealized appreciation                 $  98,038,867
                                                    ==============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.


            25 | OPPENHEIMER BALANCED FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:

                                                              YEAR ENDED DECEMBER 31, 2004        YEAR ENDED DECEMBER 31, 2003
                                                                  SHARES            AMOUNT            SHARES            AMOUNT
- -------------------------------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                                           2,625,394    $   42,309,798         2,968,658    $   42,421,336
Dividends and/or distributions reinvested                        342,260         5,486,430         1,109,495        13,791,025
Redeemed                                                      (4,948,306)      (79,604,315)       (5,419,511)      (74,334,964)
                                                            -------------------------------------------------------------------
Net decrease                                                  (1,980,652)   $  (31,808,087)       (1,341,358)   $  (18,122,603)
                                                            ===================================================================

- -------------------------------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                                           2,003,047    $   32,170,140         1,500,492    $   21,676,028
Dividends and/or distributions reinvested                         18,400           294,219             7,012            86,954
Redeemed                                                        (160,331)       (2,583,843)          (88,818)       (1,231,517)
                                                            -------------------------------------------------------------------
Net increase                                                   1,861,116    $   29,880,516         1,418,686    $   20,531,465
                                                            ===================================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than U.S. government obligations and short-term obligations, for the year ended
December 31, 2004, were $331,990,724 and $301,035,350, respectively. There were
purchases of $52,280,455 and sales of $43,715,083 of U.S. government and
government agency obligations for the year ended December 31, 2004. In addition,
there were purchases of $1,460,076,994 and sales of $1,473,590,963 of To Be
Announced (TBA) mortgage-related securities for the year ended December 31,
2004.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$19,256 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.


            26 | OPPENHEIMER BALANCED FUND/VA


- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. Following a review of its use of brokerage
commissions for sales that is permitted under its investment advisory agreement,
the Fund's Manager terminated that practice in July 2003. Subsequently, the
Manager paid the Fund $13,067, an amount equivalent to certain of such
commissions incurred in prior years.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.

- --------------------------------------------------------------------------------
6. FUTURES CONTRACTS

A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures) or debt securities (interest rate futures) in order to gain
exposure to or protection from changes in market value of stocks and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.

      The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it may
be more efficient or cost effective than actually buying securities.

      Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.

      Cash held by the broker to cover initial margin requirements on open
futures contracts is noted in the Statement of Assets and Liabilities.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable and/or payable for the
daily mark to market for variation margin. Realized gains and losses are
reported in the Statement of Operations as the closing and expiration of futures
contracts. The net change in unrealized appreciation and depreciation is
reported in the Statement of Operations.

      Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.


            27 | OPPENHEIMER BALANCED FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
6. FUTURES CONTRACTS Continued

As of December 31, 2004, the Fund had outstanding futures contracts as follows:

                                                                                UNREALIZED
                               EXPIRATION   NUMBER OF     VALUATION AS OF     APPRECIATION
CONTRACT DESCRIPTION                DATES   CONTRACTS   DECEMBER 31, 2004    (DEPRECIATION)
- -------------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
U.S. Long Bonds                   3/21/05         234       $  26,325,000      $   365,428
U.S. Treasury Nts., 10 yr.        3/21/05         253          28,320,188          149,015
                                                                               ------------
                                                                                   514,443
                                                                               ------------
CONTRACTS TO SELL
U.S. Treasury Nts., 2 yr.         3/31/05         156          32,696,625           15,330
U.S. Treasury Nts., 5 yr.         3/21/05         352          38,555,000          (52,265)
                                                                               ------------
                                                                                   (36,935)
                                                                               ------------
                                                                               $   477,508
                                                                               ============


- --------------------------------------------------------------------------------
7. OPTION ACTIVITY

The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.

      The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.

      Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.

      Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Contracts subject to call, expiration
date, exercise price, premium received and market value are detailed in a note
to the Statement of Investments. Options written are reported as a liability in
the Statement of Assets and Liabilities. Realized gains and losses are reported
in the Statement of Operations.

      The risk in writing a call option is that the Fund gives up the
opportunity for profit if the market price of the security increases and the
option is exercised. The risk in writing a put option is that the Fund may incur
a loss if the market price of the security decreases and the option is
exercised. The risk in buying an option is that the Fund pays a premium whether
or not the option is exercised. The Fund also has the additional risk of not
being able to enter into a closing transaction if a liquid secondary market does
not exist.

Written option activity for the year ended December 31, 2004 was as follows:

                                                               CALL OPTIONS
                                                 ---------------------------
                                                  NUMBER OF       AMOUNT OF
                                                  CONTRACTS        PREMIUMS
- ----------------------------------------------------------------------------
Options outstanding as of December 31, 2003           5,287     $   745,373
Options closed or expired                            (2,280)       (331,434)
Options exercised                                    (3,007)       (413,939)
                                                 ---------------------------
Options outstanding as of December 31, 2004              --     $        --
                                                 ===========================


            28 | OPPENHEIMER BALANCED FUND/VA


- --------------------------------------------------------------------------------
8. TOTAL RETURN SWAP CONTRACTS

The Fund may enter into a total return swap transaction to maintain a total
return on a particular investment, or portion of its portfolio, or for other
non-speculative purposes. Because the principal amount is not exchanged, it
represents neither an asset nor a liability to either counterparty, and is
referred to as notional. The Fund records an increase or decrease to unrealized
gain (loss), in the amount due to or owed by the Fund at termination or
settlement. Total return swaps are subject to risks (if the counterparty fails
to meet its obligations).

As of December 31, 2004, the Fund had entered into the following total return
swap agreements:

                                                          PAID BY             RECEIVED BY
SWAP                               NOTIONAL           THE FUND AT             THE FUND AT    TERMINATION        UNREALIZED
COUNTERPARTY                         AMOUNT     DECEMBER 31, 2004       DECEMBER 31, 2004          DATES      APPRECIATION
- --------------------------------------------------------------------------------------------------------------------------

                                                                    Value of total return
                                                  One-Month LIBOR      of Lehman Brothers
Deutsche Bank AG                 $4,250,000  less 50 basis points              CMBS Index         1/1/05        $   21,173
                                                                    Value of total return
Goldman Sachs                                           One-Month      of Lehman Brothers
Capital Markets LP                4,250,000             LIBOR BBA              CMBS Index        3/31/05            18,304
                                                                                                                ----------
                                                                                                                $   39,477
                                                                                                                ==========


Index abbreviations are as follows:

CMBS          Commercial Mortgage Backed Securities Markets
LIBOR         London-Interbank Offered Rate
LIBOR BBA     London-Interbank Offered Rate British Bankers Association

- --------------------------------------------------------------------------------
9. ILLIQUID SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 15% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities.

- --------------------------------------------------------------------------------
10. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had on loan securities valued at $32,538,035. Cash of $33,138,570 was
received as collateral for the loans, of which $11,966,012 was invested in
approved instruments.


            29 | OPPENHEIMER BALANCED FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
11. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.

EX-99

financials 630, 610, 485, 640, 650 and 297)




REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER BOND FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Bond Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Bond Fund/VA as of December 31, 2004, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for the periods
presented, in conformity with accounting principles generally accepted in the
United States of America.

/s/ Deloitte & Touche LLP

DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005



STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- -----------------------------------------------------------------------------------------

ASSET-BACKED SECURITIES--14.3%
- -----------------------------------------------------------------------------------------
Bank One Auto Securitization Trust,
Automobile Receivable Certificates,
Series 2003-1, Cl. A2, 1.29%,
8/21/06                                                   $   1,248,281   $    1,246,064
- -----------------------------------------------------------------------------------------
BMW Vehicle Owner Trust,
Automobile Loan Certificates,
Series 2004-A, Cl. A2, 1.88%,
10/25/06                                                      2,893,286        2,884,008
- -----------------------------------------------------------------------------------------
Capital Auto Receivables Asset
Trust, Automobile Mtg.-Backed
Nts., Series 2004-2, Cl. A3, 3.58%,
1/15/09                                                       2,250,000        2,247,188
- -----------------------------------------------------------------------------------------
Centex Home Equity Co. LLC,
Home Equity Loan Asset-Backed
Certificates:
Series 2003-C, Cl. AF1, 2.14%,
7/25/18                                                         365,095          364,688
Series 2004-A, Cl. AF1, 2.03%,
6/25/19                                                         722,488          719,706
Series 2004-D, Cl. AF1, 2.98%,
4/25/20 1                                                     1,170,118        1,166,324
- -----------------------------------------------------------------------------------------
Chase Funding Mortgage Loan
Asset-Backed Certificates, Home
Equity Mtg. Obligations:
Series 2002-4, Cl. 1A3, 3.44%,
4/25/23                                                         392,162          392,188
Series 2003-1, Cl. 1A3, 3.14%,
7/25/23                                                       1,125,276        1,124,691
Series 2003-4, Cl. 1A1, 2.538%,
9/25/17 2                                                       354,162          354,353
Series 2003-4, Cl. 1A2, 2.138%,
7/25/18                                                         900,000          896,977
- -----------------------------------------------------------------------------------------
Chase Manhattan Auto Owner
Trust, Automobile Loan
Pass-Through Certificates:
Series 2002-A, Cl. A4, 4.24%,
9/15/08                                                         591,900          595,603
Series 2003-B, Cl. A2, 1.28%,
3/15/06                                                         397,999          397,778
- -----------------------------------------------------------------------------------------
CIT Equipment Collateral,
Equipment Receivable-Backed
Nts., Series 2004-DFS, Cl. A2,
2.66%, 11/20/06 1                                             1,840,000        1,832,167
- -----------------------------------------------------------------------------------------
CitiFinancial Mortgage Securities,
Inc., Home Equity Collateralized
Mtg. Obligations:
Series 2003-2, Cl. AF1, 2.518%,
5/25/33 2                                                       209,577          209,712
Series 2003-3, Cl. AF1, 2.538%,
8/25/33 2                                                       841,457          842,020
- -----------------------------------------------------------------------------------------
Citigroup Mortgage Loan Trust,
Inc., Home Equity Mtg. Obligations,
Series 2004-OPT1, Cl. A1B,
2.388%, 9/1/34 1                                              2,104,493        2,101,862


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- -----------------------------------------------------------------------------------------

ASSET-BACKED SECURITIES Continued
- -----------------------------------------------------------------------------------------
Countrywide Asset-Backed
Certificates, Inc., Home Equity
Asset-Backed Certificates, Series
2002-4, Cl. A1, 2.788%, 2/25/33 2                         $     414,877   $      417,537
- -----------------------------------------------------------------------------------------
DaimlerChrysler Auto Trust,
Automobile Loan Pass-Through
Certificates:
Series 2003-A, Cl. A2, 1.52%, 12/8/05                         1,054,529        1,054,421
Series 2003-B, Cl. A2, 1.61%, 7/10/06                         3,726,266        3,720,003
Series 2004-B, Cl. A2, 2.48%, 2/8/07 1                          670,000          668,393
Series 2004-C, Cl. A2, 2.62%, 6/8/07                          3,330,000        3,319,778
- -----------------------------------------------------------------------------------------
Ford Credit Auto Owner Trust,
Automobile Loan Pass-Through
Certificates, Series 2004-A, Cl. A2,
2.13%, 10/15/06                                               1,100,000        1,095,717
- -----------------------------------------------------------------------------------------
Harley-Davidson Motorcycle Trust,
Motorcycle Receivable Nts., Series
2003-3, Cl. A1, 1.50%, 1/15/08                                2,369,494        2,361,123
- -----------------------------------------------------------------------------------------
Honda Auto Receivables Owner
Trust, Automobile Receivable
Obligations:
Series 2003-3, Cl. A2, 1.52%, 4/21/06                         2,495,247        2,491,068
Series 2003-4, Cl. A2, 1.58%, 7/17/06                         3,083,871        3,076,991
- -----------------------------------------------------------------------------------------
Household Automotive Trust,
Automobile Loan Certificates,
Series 2003-2, Cl. A2, 1.56%,
12/18/06                                                      1,266,104        1,263,603
- -----------------------------------------------------------------------------------------
Lease Investment Flight Trust,
Collateralized Aviation Obligations,
Series 1A, Cl. D2, 8%, 7/15/31 1                              5,356,722          502,193
- -----------------------------------------------------------------------------------------
Litigation Settlement Monetized
Fee Trust, Asset-Backed Certificates,
Series 2001-1A, Cl. A1, 8.33%,
4/25/31 1                                                     4,064,108        4,198,630
- -----------------------------------------------------------------------------------------
M&I Auto Loan Trust, Automobile
Loan Certificates:
Series 2002-1, Cl. A3, 2.49%, 10/22/07                        1,350,430        1,350,242
Series 2003-1, Cl. A2, 1.60%, 7/20/06                         2,053,001        2,050,038
- -----------------------------------------------------------------------------------------
National City Auto Receivables
Trust, Automobile Receivable
Obligations, Series 2004-A, Cl. A2,
1.50%, 2/15/07                                                1,212,883        1,208,615
- -----------------------------------------------------------------------------------------
NC Finance Trust, Collateralized
Mtg. Obligations, Series 1999-I,
Cl. ECFD, 8.75%, 1/25/29 1                                    3,370,016          899,373
- -----------------------------------------------------------------------------------------
Nissan Auto Lease Trust,
Automobile Lease Obligations:
Series 2003-A, Cl. A2, 1.69%,
12/15/05                                                        209,464          209,464
Series 2004-A, Cl. A2, 2.55%,
1/15/07                                                       1,590,000        1,588,921



                          7 | OPPENHEIMER BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- -----------------------------------------------------------------------------------------

ASSET-BACKED SECURITIES Continued
- -----------------------------------------------------------------------------------------
Nissan Auto Receivables Owner
Trust, Automobile Receivable Nts.,
Series 2002-A, Cl. A4, 4.28%,
10/16/06                                                  $     469,590   $      471,958
- -----------------------------------------------------------------------------------------
Option One Mortgage Loan Trust,
Home Equity Mtg. Obligations,
Series 2004-3, Cl. A2, 2.568%,
11/25/34 1,2                                                  1,129,842        1,130,569
- -----------------------------------------------------------------------------------------
Popular ABS Mortgage Pass-Through
Trust, Home Equity Pass-Through
Certificates, Series 2004-5, Cl. A F2,
3.735%, 11/10/34 1                                              620,000          617,937
- -----------------------------------------------------------------------------------------
Tobacco Settlement Authority,
Asset-Backed Securities, Series
2001-A, 6.79%, 6/1/10                                         1,930,000        1,924,673
- -----------------------------------------------------------------------------------------
Toyota Auto Receivables Owner
Trust, Automobile Mtg.-Backed
Obligations:
Series 2002-B, Cl. A3, 3.76%, 6/15/06                           239,721          240,067
Series 2003-B, Cl. A2, 1.43%, 2/15/06                           975,302          974,707
- -----------------------------------------------------------------------------------------
USAA Auto Owner Trust, Automobile
Loan Asset-Backed Nts.:
Series 2001-2, Cl. A4, 3.91%, 4/16/07                           462,011          462,934
Series 2002-1, Cl. A3, 2.41%, 10/16/06                          577,258          577,239
Series 2004-2, Cl. A2, 2.41%, 2/15/07                         2,270,000        2,262,828
Series 2004-3, Cl. A2, 2.79%, 6/15/07                         1,540,000        1,536,962
- -----------------------------------------------------------------------------------------
Volkswagen Auto Lease Trust,
Automobile Lease Asset-Backed
Securities, Series 2004-A, Cl. A2,
2.47%, 1/22/07                                                2,190,000        2,179,991
- -----------------------------------------------------------------------------------------
Volkswagen Auto Loan Enhanced
Trust, Automobile Loan Receivable
Certificates:
Series 2003-1, Cl. A2, 1.11%,
12/20/05                                                        148,183          148,133
Series 2003-2, Cl. A2, 1.55%,
6/20/06                                                       1,667,494        1,664,255
- -----------------------------------------------------------------------------------------
Wachovia Auto Owner Trust,
Automobile Receivable Nts.,
Series 2004-B, Cl. A2, 2.40%,
5/21/07                                                       1,620,000        1,613,333
- -----------------------------------------------------------------------------------------
Wells Fargo Home Equity Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. AI1B, 2.94%,
9/25/18                                                       3,358,336        3,342,250
- -----------------------------------------------------------------------------------------
Whole Auto Loan Trust,
Automobile Loan Receivable
Certificates:
Series 2003-1, Cl. A2A, 1.40%,
4/15/06                                                       2,234,176        2,229,987
Series 2004-1, Cl. A2A, 2.59%,
5/15/07                                                       2,000,000        1,992,640
                                                                          ---------------
Total Asset-Backed Securities
(Cost $78,256,358)                                                            72,221,902


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- -----------------------------------------------------------------------------------------

MORTGAGE-BACKED OBLIGATIONS--54.1%
- -----------------------------------------------------------------------------------------
GOVERNMENT AGENCY--43.3%
- -----------------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED--43.1%
Fannie Mae Whole Loan,
Collateralized Mtg. Obligations
Pass-Through Certificates, Trust
004-W9, Cl. 2A2, 7%, 2/25/44 3                            $   1,305,163   $    1,383,877
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.:
5%, 1/1/35 3                                                  5,153,000        5,117,573
5.50%, 1/1/35 3                                               1,783,000        1,811,417
6.50%, 7/1/28-4/1/34                                          1,512,292        1,589,756
7%, 3/1/31-11/1/34                                           15,183,200       16,104,550
7%, 4/1/32-1/1/35 3                                           4,290,000        4,544,719
8%, 4/1/16                                                    1,466,570        1,557,217
9%, 8/1/22-5/1/25                                               401,828          447,652
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Collateralized Mtg.
Obligations, Pass-Through
Participation Certificates,
Series 151, Cl. F, 9%, 5/15/21                                   72,045           72,086
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Gtd. Real Estate Mtg.
Investment Conduit Multiclass
Pass-Through Certificates:
Series 2500, Cl. FD, 2.903%,
3/15/32 2                                                       826,692          829,935
Series 2526, Cl. FE, 2.803%,
6/15/29 2                                                     1,116,913        1,120,933
Series 2551, Cl. FD, 2.803%,
1/15/33 2                                                       897,254          903,404
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Interest-Only Stripped
Mtg.-Backed Security:
Series 176, Cl. IO, (0.21)%, 6/1/26 4                         1,267,751          236,695
Series 183, Cl. IO, (1.41)%, 4/1/27 4                         1,984,500          384,749
Series 184, Cl. IO, 1.81%, 12/1/26 4                          2,036,419          378,674
Series 192, Cl. IO, 3.27%, 2/1/28 4                             485,244           90,177
Series 200, Cl. IO, 2.89%, 1/1/29 4                             592,784          113,646
Series 206, Cl. IO, (16.54)%,
12/1/29 4                                                     1,352,113          245,798
Series 2130, Cl. SC, 12.38%,
3/15/29 4                                                     1,349,514          140,976
Series 2796, Cl. SD, 19.10%,
7/15/26 4                                                     2,071,436          209,384
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Principal-Only Stripped
Mtg.-Backed Security, Series
176, Cl. PO, 6.95%, 6/1/26 5                                    516,501          450,616
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.:
4.50%, 1/1/20 3                                              12,307,000       12,268,541
5%, 1/1/20-1/1/35 3                                          22,401,000       22,369,335
5.50%, 3/1/33-1/1/34                                         14,236,928       14,470,326
5.50%, 1/1/35 3                                              20,092,000       20,399,649
6%, 8/1/24                                                    2,296,120        2,389,823
6%, 1/1/35 3                                                 18,725,000       19,362,811
6.50%, 3/1/11                                                    64,829           68,799


                          8 | OPPENHEIMER BOND FUND/VA


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

FHLMC/FNMA/SPONSORED Continued
Federal National Mortgage Assn.: Continued
6.50%, 1/1/35 3                                           $  45,697,000   $   47,924,729
7%, 11/1/25-7/1/34                                           10,186,327       10,811,344
7%, 1/1/35 3                                                 11,749,000       12,450,274
7.50%, 1/1/08-1/1/26                                            139,152          148,799
8%, 5/1/17                                                       16,011           17,450
8.50%, 7/1/32                                                   202,224          219,691
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Collateralized Mtg. Obligations,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates:
Trust 131, Cl. G, 8.75%, 11/25/05                                18,268           18,547
Trust 1993-87, Cl. Z, 6.50%,
6/25/23                                                       2,683,300        2,817,589
Trust 2001-70, Cl. LR, 6%, 9/25/30                            1,126,397        1,148,481
Trust 2001-72, Cl. NH, 6%, 4/25/30                              908,252          928,849
Trust 2001-74, Cl. PD, 6%, 5/25/30                              383,581          388,786
Trust 2002-50, Cl. PD, 6%, 9/25/27                              630,718          631,141
Trust 2002-77, Cl. WF, 2.81%,
12/18/32 2                                                    1,440,915        1,449,427
Trust 2003-81, Cl. PA, 5%, 2/25/12                              625,637          627,937
Trust 2004-101, Cl. BG, 5%, 1/25/20                           1,908,000        1,924,695
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates,
Trust 1989-17, Cl. E, 10.40%,
4/25/19                                                         127,390          142,299
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates,
Interest-Only Stripped Mtg.-Backed
Security:
Trust 319, Cl. 2, (3.08)%, 2/1/32 4                             914,601          175,797
Trust 2002-47, Cl. NS, 9.28%,
4/25/32 4                                                     2,682,302          281,133
Trust 2002-51, Cl. S, 9.56%,
8/25/32 4                                                     2,462,362          258,344
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Interest-Only Stripped Mtg.-Backed
Security:
Trust 222, Cl. 2, (2.03)%, 6/1/23 4                           3,836,433          714,784
Trust 240, Cl. 2, (1.12)%, 9/1/23 4                           4,450,477          847,552
Trust 252, Cl. 2, (3.44)%, 11/1/23 4                          3,039,360          597,047
Trust 254, Cl. 2, (0.11)%, 1/1/24 4                           1,482,053          306,254
Trust 273, Cl. 2, 0.09%, 7/1/26 4                               920,321          170,042
Trust 303, Cl. IO, (13.36)%, 11/1/29 4                          577,780          112,856
Trust 321, Cl. 2, (8.68)%, 3/1/32 4                          10,036,256        1,994,458
Trust 333, Cl. 2, 2.09%, 3/1/33 4                             3,221,848          696,792
Trust 334, Cl. 17, (16.18)%, 2/1/33 4                         1,641,349          329,047
Trust 2001-81, Cl. S, 13.68%,
1/25/32 4                                                     1,056,260          128,828
Trust 2002-52, Cl. SD, 8.50%,
9/25/32 4                                                     3,113,327          321,902
Trust 2002-77, Cl. SH, 21.15%,
12/18/32 4                                                    1,250,229          126,609
Trust 2004-54, Cl. DS, 20.40%,
11/25/30 4                                                    2,208,796          201,289


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

FHLMC/FNMA/SPONSORED Continued
Federal National Mortgage Assn.,
Principal-Only Stripped Mtg.-Backed
Security, Trust 1993-184, Cl. M,
9.71%, 9/25/23 5                                          $   1,016,567   $      880,366
                                                                          ---------------
                                                                             218,856,256

- -----------------------------------------------------------------------------------------
GNMA/GUARANTEED--0.2%
Government National Mortgage
Assn.:
7%, 1/15/09-5/15/09                                              63,937           67,640
8.50%, 8/15/17-12/15/17                                         521,575          574,537
- -----------------------------------------------------------------------------------------
Government National Mortgage
Assn., Interest-Only Stripped
Mtg.-Backed Security:
Series 2001-21, Cl. SB, 14.94%,
1/16/27 4                                                     2,062,394          197,250
Series 2002-15, Cl. SM, 9.39%,
2/16/32 4                                                     2,427,939          234,086
Series 2004-11, Cl. SM, 10.64%,
1/17/30 4                                                     1,906,852          171,457
                                                                          ---------------
                                                                               1,244,970

- -----------------------------------------------------------------------------------------
PRIVATE--10.8%
- -----------------------------------------------------------------------------------------
COMMERCIAL--10.2%
Asset Securitization Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1996-MD6,
Cl. A3, 7.405%, 11/13/29 2                                    1,200,000        1,298,748
- -----------------------------------------------------------------------------------------
Asset Securitization Corp.,
Interest-Only Stripped Mtg.-Backed
Security Collateralized Mtg.
Obligations, Series 1997-D4,
Cl. PS1, 5.54%, 4/14/29 4                                    42,978,868        1,596,437
- -----------------------------------------------------------------------------------------
Banc of America Commercial
Mortgage, Inc., Commercial Mtg.
Pass-Through Certificates, Series
2004-6, Cl. A3, 4.512%, 12/10/42                              1,720,000        1,720,000
- -----------------------------------------------------------------------------------------
Bank of America Mortgage
Securities, Inc., Collateralized
Mtg. Obligations Pass-Through
Certificates:
Series 2004-E, Cl. 2A9, 3.712%,
6/25/34                                                       2,005,519        2,006,786
Series 2004-G, Cl. 2A1, 2.469%,
8/25/34                                                       1,364,127        1,361,438
Series 2004-2, Cl. 2A1, 6.50%,
7/20/32                                                       3,609,116        3,687,259
Series 2004-8, Cl. 5A1, 6.50%,
5/25/32                                                       2,702,672        2,808,246
- -----------------------------------------------------------------------------------------
Capital Lease Funding Securitization
LP, Interest-Only Corporate-Backed
Pass-Through Certificates, Series
1997-CTL1, 9.87%, 6/22/24 4                                  25,279,609          959,280


                          9 | OPPENHEIMER BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

COMMERCIAL Continued
Countrywide Alternative Loan Trust,
Collateralized Mtg. Obligations,
Series 2004-J9, Cl. 1A1, 2.598%,
10/25/34 2                                                $   2,501,567   $    2,504,445
- -----------------------------------------------------------------------------------------
DLJ Mortgage Acceptance Corp.,
Commercial Mtg. Obligations,
Series 1996-CF1, Cl. A3, 7.904%,
3/13/28 2                                                       711,193          723,130
- -----------------------------------------------------------------------------------------
First Union National Bank/
Lehman Brothers/Bank of
America Commercial Mtg. Trust,
Pass-Through Certificates, Series
1998-C2, Cl. A2, 6.56%, 11/18/35                              1,510,000        1,624,400
- -----------------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc., Commercial Mtg.
Obligations, Series 2004-C3, Cl. A4,
4.547%, 12/10/41                                              1,110,000        1,112,920
- -----------------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc., Commercial Mtg.
Pass-Through Certificates, Series
1997-C1, Cl. A3, 6.869%, 7/15/29                              1,152,983        1,220,512
- -----------------------------------------------------------------------------------------
GS Mortgage Securities Corp. II,
Commercial Mtg. Pass-Through
Certificates, Series 2004-C1, Cl. A1,
3.659%, 10/10/28                                              1,271,204        1,257,387
- -----------------------------------------------------------------------------------------
GSR Mortgage Loan Trust,
Collateralized Mtg. Obligations,
Series 04-12, Cl. 3A1, 4.593%,
12/25/34 1,2                                                  3,795,193        3,800,420
- -----------------------------------------------------------------------------------------
Lehman Brothers Commercial
Conduit Mortgage Trust, Interest-
Only Stripped Mtg.-Backed Security,
Series 1998-C1, Cl. IO, 6.40%,
2/18/30 4                                                    18,695,717          603,090
- -----------------------------------------------------------------------------------------
Lehman Structured Securities Corp.,
Collateralized Mtg. Obligations,
Series 2002-GE1, Cl. A, 2.514%,
7/26/24 1                                                       415,366          382,093
- -----------------------------------------------------------------------------------------
Mastr Alternative Loan Trust,
Pass-Through Collateralized Mtg.
Obligations, Series 2004-6, Cl
10A1, 6%, 7/25/34                                             3,519,677        3,634,390
- -----------------------------------------------------------------------------------------
Mastr Asset Securitization Trust,
Pass-Through Collateralized Mtg.
Obligations, Series 2004-9, Cl. A3,
4.70%, 8/25/34                                                2,885,183        2,887,520
- -----------------------------------------------------------------------------------------
Mastr Seasoned Securities Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. PT65, 6.50%,
12/1/34 3                                                     5,041,000        5,191,442
- -----------------------------------------------------------------------------------------
Nomura Asset Securities Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1998-D6, Cl. A1B,
6.59%, 3/15/30                                                1,680,000        1,818,240


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

COMMERCIAL Continued
Salomon Brothers Mortgage
Securities VII, Inc., Interest-Only
Commercial Mtg. Pass-Through
Certificates, Series 1999-C1, Cl. X,
7.85%, 5/18/32 4                                          $ 379,935,952   $    1,538,323
- -----------------------------------------------------------------------------------------
Wells Fargo Mortgage-Backed
Securities Trust, Collateralized
Mtg. Obligations:
Series 2004-DD, Cl. 2 A1, 4.548%,
1/25/35                                                       2,540,000        2,544,167
Series 2004-N, Cl. A10, 3.803%,
8/25/34 1                                                     3,553,553        3,565,241
Series 2004-W, Cl. A2, 4.635%,
11/25/34 2                                                    1,965,129        1,970,554
                                                                          ---------------
                                                                              51,816,468

- -----------------------------------------------------------------------------------------
OTHER--0.1%
CIT Equipment Collateral,
Equipment Receivable-Backed
Nts., Series 2003-EF1, Cl. A2,
1.49%, 12/20/05                                                 226,169          226,215
- -----------------------------------------------------------------------------------------
Salomon Brothers Mortgage
Securities VI, Inc., Interest-Only
Stripped Mtg.-Backed Security,
Series 1987-3, Cl. B, 34.28%,
10/23/17 4                                                       24,848            5,917
- -----------------------------------------------------------------------------------------
Salomon Brothers Mortgage
Securities VI, Inc., Principal-Only
Stripped Mtg.-Backed Security,
Series 1987-3, Cl. A, 9.29%,
10/23/17 5                                                       36,775           33,828
                                                                          ---------------
                                                                                 265,960

- -----------------------------------------------------------------------------------------
RESIDENTIAL--0.5%
Structured Asset Securities Corp.,
Collateralized Mtg. Obligations
Pass-Through Certificates, Series
2002-AL1, Cl. B2, 3.45%, 2/25/32                              2,908,347        2,588,930
                                                                          ---------------
Total Mortgage-Backed Obligations
(Cost $274,406,649)                                                          274,772,584

- -----------------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS--9.1%
- -----------------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp. Unsec. Nts.:
6.625%, 9/15/09                                              14,525,000       16,260,447
6.875%, 9/15/10                                               7,300,000        8,343,637
- -----------------------------------------------------------------------------------------
Federal National Mortgage Assn.
Unsec. Nts.:
3.01%, 6/2/06 6                                               2,500,000        2,489,780
6.625%, 9/15/09                                               6,010,000        6,717,449
7.25%, 5/15/30                                                1,665,000        2,135,717
- -----------------------------------------------------------------------------------------
Tennessee Valley Authority Bonds:
7.125%, 5/1/30                                                2,570,000        3,207,201
Series A, 6.79%, 5/23/12                                      5,659,000        6,525,755


                          10 | OPPENHEIMER BOND FUND/VA


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

U.S. GOVERNMENT OBLIGATIONS Continued
- -----------------------------------------------------------------------------------------
U.S. Treasury Nts., 4.25%, 11/15/14                       $     758,000   $      760,221
                                                                          ---------------
Total U.S. Government Obligations
(Cost $46,186,100)                                                            46,440,207

- -----------------------------------------------------------------------------------------
FOREIGN GOVERNMENT OBLIGATIONS--0.6%
- -----------------------------------------------------------------------------------------
United Mexican States Nts., 7.50%,
1/14/12 (Cost $2,632,266)                                     2,610,000        2,966,265

- -----------------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--40.8%
- -----------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--11.5%
- -----------------------------------------------------------------------------------------
AUTO COMPONENTS--1.1%
Delphi Automotive Systems Corp.,
6.50% Nts., 5/1/09                                            3,195,000        3,287,016
- -----------------------------------------------------------------------------------------
Lear Corp., 8.11% Sr. Unsec. Nts.,
Series B, 5/15/09                                             2,265,000        2,571,239
                                                                          ---------------
                                                                               5,858,255

- -----------------------------------------------------------------------------------------
AUTOMOBILES--2.9%
American Honda Finance Corp.,
3.85% Nts., 11/6/08 7                                         1,555,000         1,552,036
- -----------------------------------------------------------------------------------------
DaimlerChrysler North America
Holding Corp., 4.75% Unsec. Nts.,
1/15/08                                                       3,645,000        3,725,434
- -----------------------------------------------------------------------------------------
Ford Holdings, Inc., 9.30% Unsec.
Unsub. Debs., 3/1/30                                            460,000          540,918
- -----------------------------------------------------------------------------------------
Ford Motor Credit Co., 7.375% Nts.,
10/28/09                                                        485,000          523,685
- -----------------------------------------------------------------------------------------
General Motors Corp., 8.375% Sr.
Unsec. Debs., 7/15/33                                         2,705,000        2,810,365
- -----------------------------------------------------------------------------------------
Hertz Corp. (The), 6.35% Nts.,
6/15/10                                                       2,960,000        3,037,132
- -----------------------------------------------------------------------------------------
Volkswagen Credit, Inc., 2.33%
Nts., 7/21/05 2,7                                             2,695,000        2,695,226
                                                                          ---------------
                                                                              14,884,796

- -----------------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--1.0%
Hilton Hotels Corp., 7.95% Sr. Nts.,
4/15/07                                                       1,025,000        1,115,458
- -----------------------------------------------------------------------------------------
Starwood Hotels & Resorts
Worldwide, Inc., 7.375% Nts., 5/1/07                            805,000          862,356
- -----------------------------------------------------------------------------------------
Yum! Brands, Inc., 8.50% Sr. Unsec.
Nts., 4/15/06                                                 2,785,000        2,959,377
                                                                          ---------------
                                                                               4,937,191

- -----------------------------------------------------------------------------------------
HOUSEHOLD DURABLES--1.2%
Beazer Homes USA, Inc., 8.625%
Sr. Unsec. Nts., 5/15/11                                      1,440,000        1,576,800
- -----------------------------------------------------------------------------------------
D.R. Horton, Inc., 6.125% Nts.,
1/15/14                                                       1,415,000        1,464,525
- -----------------------------------------------------------------------------------------
Lennar Corp., 5.95% Sr. Unsec. Nts.,
3/1/13                                                        1,250,000        1,325,891


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

HOUSEHOLD DURABLES Continued
Toll Corp., 8.25% Sr. Sub. Nts.,
12/1/11                                                   $   1,440,000   $    1,598,400
                                                                          ---------------
                                                                               5,965,616

- -----------------------------------------------------------------------------------------
MEDIA--3.9%
Chancellor Media CCU, 8% Sr.
Unsec. Nts., 11/1/08                                          2,525,000        2,837,390
- -----------------------------------------------------------------------------------------
Cox Communications, Inc.,
7.875% Unsec. Nts., 8/15/09                                   1,695,000        1,925,678
- -----------------------------------------------------------------------------------------
Liberty Media Corp., 3.50% Nts.,
9/25/06                                                       1,660,000        1,651,459
- -----------------------------------------------------------------------------------------
TCI Communications, Inc.,
9.80% Sr. Unsec. Debs., 2/1/12                                2,500,000        3,226,815
- -----------------------------------------------------------------------------------------
Time Warner Cos., Inc., 9.125%
Debs., 1/15/13                                                2,840,000        3,656,415
- -----------------------------------------------------------------------------------------
Time Warner Entertainment Co.
LP, 10.15% Sr. Nts., 5/1/12                                   1,073,000        1,409,602
- -----------------------------------------------------------------------------------------
Univision Communications, Inc.:
2.875% Sr. Unsec. Nts., 10/15/06                                357,000          352,422
3.50% Sr. Unsec. Nts., 10/15/07                               1,860,000        1,839,257
- -----------------------------------------------------------------------------------------
Walt Disney Co. (The), 5.375%
Sr. Unsec. Nts., 6/1/07                                       2,975,000        3,094,271
                                                                          ---------------
                                                                              19,993,309

- -----------------------------------------------------------------------------------------
MULTILINE RETAIL--1.0%
Federated Department Stores,
Inc., 6.625% Sr. Unsec. Nts., 9/1/08                          1,785,000        1,944,800
- -----------------------------------------------------------------------------------------
J.C. Penney Co., Inc., 8% Nts., 3/1/10                        2,640,000        3,029,400
- -----------------------------------------------------------------------------------------
May Department Stores Co.,
3.95% Nts., 7/15/07                                             178,000          178,407
                                                                          ---------------
                                                                               5,152,607

- -----------------------------------------------------------------------------------------
SPECIALTY RETAIL--0.4%
Gap, Inc. (The):
6.90% Nts., 9/15/07 1                                         1,169,000        1,262,520
10.55% Unsub. Nts., 12/15/08                                    466,000          569,685
                                                                          ---------------
                                                                               1,832,205

- -----------------------------------------------------------------------------------------
CONSUMER STAPLES--3.2%
- -----------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--1.8%
Food Lion, Inc., 7.55% Nts., 4/15/07                          1,815,000        1,972,083
- -----------------------------------------------------------------------------------------
Kroger Co. (The), 7.80% Sr. Nts.,
8/15/07                                                       4,300,000        4,718,566
- -----------------------------------------------------------------------------------------
Safeway, Inc., 4.80% Sr. Unsec. Nts.,
7/16/07                                                       2,440,000        2,499,268
                                                                          ---------------
                                                                               9,189,917

- -----------------------------------------------------------------------------------------
FOOD PRODUCTS--1.4%
ConAgra Foods, Inc., 6% Nts.,
9/15/06                                                       1,320,000        1,374,937
- -----------------------------------------------------------------------------------------
General Mills, Inc., 3.875% Nts.,
11/30/07                                                      2,070,000        2,078,034



                          11 | OPPENHEIMER BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

FOOD PRODUCTS Continued
Kraft Foods, Inc., 5.25% Nts., 6/1/07                     $   3,275,000   $    3,394,407
                                                                          ---------------
                                                                               6,847,378

- -----------------------------------------------------------------------------------------
ENERGY--1.5%
- -----------------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.1%
Ocean Rig Norway AS, 10.25% Sr.
Sec. Nts., 6/1/08                                               400,000          414,000
- -----------------------------------------------------------------------------------------
OIL & GAS--1.4%
Chesapeake Energy Corp., 7.50% Sr.
Nts., 6/15/14                                                 1,380,000        1,514,550
- -----------------------------------------------------------------------------------------
Kinder Morgan, Inc., 6.50% Sr. Unsec.
Nts., 9/1/12                                                  1,980,000        2,179,679
- -----------------------------------------------------------------------------------------
Petroleos Mexicanos, 9.50% Sr. Sub.
Nts., 9/15/27                                                 1,730,000        2,175,475
- -----------------------------------------------------------------------------------------
PF Export Receivables Master Trust,
3.748% Sr. Nts., Series B, 6/1/13 7                           1,522,029        1,477,852
                                                                          ---------------
                                                                               7,347,556

- -----------------------------------------------------------------------------------------
FINANCIALS--10.6%
- -----------------------------------------------------------------------------------------
COMMERCIAL BANKS--0.3%
Bank of America Corp., 4.875% Sr.
Unsec. Nts., 1/15/13                                             33,000           33,629
- -----------------------------------------------------------------------------------------
National City Bank, 6.20% Sub. Nts.,
12/15/11                                                        178,000          195,963
- -----------------------------------------------------------------------------------------
SunTrust Banks, Inc.:
4% Nts., 10/15/08                                             1,370,000        1,383,832
7.75% Unsec. Sub. Nts., 5/1/10                                  123,000          143,014
                                                                          ---------------
                                                                               1,756,438

- -----------------------------------------------------------------------------------------
CONSUMER FINANCE--0.3%
Household Finance Corp., 8.875%
Sr. Unsec. Nts., 2/15/06                                      1,435,000        1,519,471
- -----------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--3.3%
American Express Centurion Bank,
4.375% Nts., 7/30/09                                            950,000          966,120
- -----------------------------------------------------------------------------------------
CIT Group, Inc., 7.75% Sr. Unsec.
Unsub. Nts., 4/2/12                                           3,080,000        3,650,995
- -----------------------------------------------------------------------------------------
Franklin Resources, Inc., 3.70% Nts.,
4/15/08                                                       1,430,000        1,427,713
- -----------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.,
7% Nts., 2/1/08                                               1,660,000        1,814,956
- -----------------------------------------------------------------------------------------
Lehman Brothers, Inc., 6.625% Sr.
Sub. Nts., 2/15/08                                              262,000          283,077
- -----------------------------------------------------------------------------------------
MBNA America Bank NA, 5.375%
Nts., 1/15/08                                                 2,050,000        2,142,588
- -----------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 4.125%
Nts., 9/10/09                                                 2,755,000        2,756,022
- -----------------------------------------------------------------------------------------
Morgan Stanley, 6.60% Nts., 4/1/12                            3,410,000        3,808,769
                                                                          ---------------
                                                                              16,850,240


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

INSURANCE--4.9%
Allstate Financial Global Funding
LLC, 4.25% Nts., 9/10/08 7                                $     520,000   $      526,567
- -----------------------------------------------------------------------------------------
Allstate Life Global Funding II,
3.50% Nts., 7/30/07                                             710,000          707,436
- -----------------------------------------------------------------------------------------
AXA, 8.60% Unsec. Sub. Nts.,
12/15/30                                                      2,520,000        3,319,626
- -----------------------------------------------------------------------------------------
Hartford Financial Services Group,
Inc. (The), 2.375% Nts., 6/1/06                               1,185,000        1,163,733
- -----------------------------------------------------------------------------------------
John Hancock Global Funding II,
7.90% Nts., 7/2/10 7                                          2,554,000        2,993,814
- -----------------------------------------------------------------------------------------
Marsh & McLennan Cos., Inc.,
5.375% Nts., 7/15/14                                            506,000          495,303
- -----------------------------------------------------------------------------------------
Nationwide Financial Services,
Inc., 5.90% Nts., 7/1/12                                      3,185,000        3,368,332
- -----------------------------------------------------------------------------------------
Prudential Holdings LLC, 8.695%
Bonds, Series C, 12/18/23 7                                   4,640,000        5,907,323
- -----------------------------------------------------------------------------------------
Prudential Insurance Co. of
America, 8.30% Nts., 7/1/25 7                                 4,875,000        6,242,442
                                                                          ---------------
                                                                              24,724,576

- -----------------------------------------------------------------------------------------
REAL ESTATE--1.8%
iStar Financial, Inc.:
4.875% Sr. Unsec. Nts., Series B,
1/15/09                                                       1,235,000        1,254,685
8.75% Sr. Unsec. Nts., 8/15/08                                  905,000        1,032,802
- -----------------------------------------------------------------------------------------
Liberty Property Trust,
5.65% Sr. Nts., 8/15/14                                       1,330,000        1,369,046
- -----------------------------------------------------------------------------------------
Spieker Properties LP, 6.75%
Unsec. Unsub. Nts., 1/15/08                                   2,400,000        2,603,052
- -----------------------------------------------------------------------------------------
Vornado Realty LP, 5.625% Sr.
Unsec. Unsub. Nts., 6/15/07                                   2,630,000        2,732,094
                                                                          ---------------
                                                                               8,991,679

- -----------------------------------------------------------------------------------------
HEALTH CARE--1.2%
- -----------------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--1.2%
Aetna, Inc., 7.375% Sr. Unsec.
Nts., 3/1/06                                                  2,730,000        2,842,774
- -----------------------------------------------------------------------------------------
CIGNA Corp., 7.40% Unsec.
Nts., 5/15/07                                                 3,195,000        3,434,328
                                                                          ---------------
                                                                               6,277,102

- -----------------------------------------------------------------------------------------
INDUSTRIALS--3.7%
- -----------------------------------------------------------------------------------------
AEROSPACE & DEFENSE--0.6%
Boeing Capital Corp., 5.65% Sr.
Unsec. Nts., 5/15/06                                            406,000          418,788
- -----------------------------------------------------------------------------------------
McDonnell Douglas Corp.,
6.875% Unsec. Unsub. Nts., 11/1/06                              366,000          387,576
- -----------------------------------------------------------------------------------------
Northrop Grumman Corp.,
7.125% Sr. Nts., 2/15/11                                      2,210,000        2,539,416
                                                                          ---------------
                                                                               3,345,780



                          12 | OPPENHEIMER BOND FUND/VA


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

AIR FREIGHT & LOGISTICS--0.6%
FedEx Corp., 2.65% Unsec. Nts.,
4/1/07                                                    $   2,975,000   $    2,915,360
- -----------------------------------------------------------------------------------------
BUILDING PRODUCTS--0.1%
Green Star Products, Inc., 10.15%
Bonds, 6/24/10 7                                                682,655          695,451
- -----------------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--0.9%
Allied Waste North America, Inc.,
8.875% Sr. Nts., Series B, 4/1/08                             1,330,000        1,429,750
- -----------------------------------------------------------------------------------------
Protection One, Inc./Protection
One Alarm Monitoring, Inc.,
7.375% Sr. Unsec. Nts., 8/15/05                                 300,000          304,500
- -----------------------------------------------------------------------------------------
Waste Management, Inc.:
7% Sr. Nts., 7/15/28                                            920,000        1,040,825
7.125% Sr. Unsec. Nts., 10/1/07                               1,485,000        1,613,861
                                                                          ---------------
                                                                               4,388,936

- -----------------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--1.0%
Hutchison Whampoa International
Ltd., 7.45% Sr. Bonds, 11/24/33 7                              1,675,000        1,863,566
- -----------------------------------------------------------------------------------------
Tyco International Group SA:
6.375% Sr. Unsec. Unsub. Nts.,
2/15/06                                                       1,895,000        1,958,666
6.75% Sr. Unsub. Nts., 2/15/11                                  975,000        1,094,152
                                                                          ---------------
                                                                               4,916,384

- -----------------------------------------------------------------------------------------
ROAD & RAIL--0.5%
Canadian National Railway Co.,
4.25% Nts., 8/1/09                                              358,000          361,220
- -----------------------------------------------------------------------------------------
CSX Corp., 6.25% Unsec. Nts.,
10/15/08                                                      2,012,000        2,171,121
                                                                          ---------------
                                                                               2,532,341

- -----------------------------------------------------------------------------------------
MATERIALS--0.2%
- -----------------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--0.2%
Weyerhaeuser Co., 5.50% Unsec.
Unsub. Nts., 3/15/05                                            873,000          877,062
- -----------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--3.6%
- -----------------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--3.1%
British Telecommunications plc:
7.875% Nts., 12/15/05                                         2,525,000        2,634,148
8.125% Nts., 12/15/10                                           215,000          258,495
- -----------------------------------------------------------------------------------------
Citizens Communications Co.,
9.25% Sr. Nts., 5/15/11                                         989,000        1,162,075
- -----------------------------------------------------------------------------------------
Deutsche Telekom International
Finance BV, 8.50% Unsub. Nts.,
6/15/10                                                       2,630,000        3,136,809
- -----------------------------------------------------------------------------------------
France Telecom SA:
7.95% Sr. Unsec. Nts., 3/1/06                                 2,070,000        2,174,030
9.25% Sr. Unsec. Nts., 3/1/31 2                               1,150,000        1,563,540
- -----------------------------------------------------------------------------------------
Sprint Capital Corp.:
7.125% Sr. Unsec. Nts., 1/30/06                               1,345,000        1,399,316
8.75% Nts., 3/15/32                                           1,220,000        1,630,420


                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- ----------------------------------------------------------------------------------------

DIVERSIFIED TELECOMMUNICATION SERVICES Continued
Telefonos de Mexico SA de CV,
4.50% Nts., 11/19/08                                      $   1,750,000   $    1,766,037
                                                                          ---------------
                                                                              15,724,870

- -----------------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--0.5%
AT&T Wireless Services, Inc.,
7.50% Sr. Unsec. Nts., 5/1/07                                 2,395,000        2,602,747
- -----------------------------------------------------------------------------------------
UTILITIES--5.3%
- -----------------------------------------------------------------------------------------
ELECTRIC UTILITIES--4.4%
CenterPoint Energy, Inc.:
5.875% Sr. Nts., 6/1/08                                       2,425,000        2,539,445
8.125% Unsec. Nts., Series B, 7/15/05                           530,000          544,031
- -----------------------------------------------------------------------------------------
Conectiv, Inc., 5.30% Unsec.
Unsub. Nts., Series B, 6/1/05                                   397,000          400,264
- -----------------------------------------------------------------------------------------
Dominion Resources, Inc.,
8.125% Sr. Unsub. Nts., 6/15/10                               3,390,000        3,994,623
- -----------------------------------------------------------------------------------------
DTE Energy Co., 6.45% Sr. Unsub.
Nts., 6/1/06                                                    725,000          754,979
- -----------------------------------------------------------------------------------------
Duke Capital LLC, 5.668% Nts.,
8/15/14                                                       1,380,000        1,426,586
- -----------------------------------------------------------------------------------------
FirstEnergy Corp.:
5.50% Sr. Unsub. Nts., Series A,
11/15/06                                                        995,000        1,027,619
7.375% Sr. Unsub. Nts., Series C,
11/15/31                                                      1,140,000        1,305,949
- -----------------------------------------------------------------------------------------
IPALCO Enterprises, Inc., 8.375%
Sr. Sec. Nts., 11/14/08 1,2                                   1,180,000        1,333,400
- -----------------------------------------------------------------------------------------
MidAmerican Energy Holdings
Co., 5.875% Sr. Unsec. Nts., 10/1/12                          3,750,000        3,979,841
- -----------------------------------------------------------------------------------------
PSEG Energy Holdings LLC,
7.75% Unsec. Nts., 4/16/07 1                                  1,575,000        1,673,438
- -----------------------------------------------------------------------------------------
TECO Energy, Inc., 10.50% Sr.
Unsec. Nts., 12/1/07                                          1,690,000        1,956,178
- -----------------------------------------------------------------------------------------
TXU Corp., 4.80% Nts., 11/15/09 7                             1,260,000        1,263,611
                                                                          ---------------
                                                                              22,199,964

- -----------------------------------------------------------------------------------------
GAS UTILITIES--0.9%
NiSource Finance Corp., 7.875%
Sr. Unsec. Nts., 11/15/10                                     3,920,000        4,613,797
                                                                          ---------------
Total Corporate Bonds and Notes
(Cost $199,200,861)                                                          207,355,028




                                                                  UNITS
- -----------------------------------------------------------------------------------------

RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- -----------------------------------------------------------------------------------------
Pathmark Stores, Inc. Wts.,
Exp. 9/19/10 8 (Cost $14,872)                                     5,408            1,082



                          13 | OPPENHEIMER BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                              PRINCIPAL            VALUE
                                                                 AMOUNT       SEE NOTE 1
- -----------------------------------------------------------------------------------------

STRUCTURED NOTES--3.0%
- -----------------------------------------------------------------------------------------
Deutsche Bank AG, COUNTS Corp.
Sec. Credit Linked Nts., Series 2003-1,
3.78%, 1/7/05 1,2 (Cost $15,300,000)                      $  15,300,000   $   15,254,100
- -----------------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--4.6%
- -----------------------------------------------------------------------------------------
Undivided interest of 1.63% in joint repurchase
agreement (Principal Amount/Value $1,443,703,000,
with a maturity value of $1,443,962,867) with UBS
Warburg LLC, 2.16%, dated 12/31/04, to be repurchased
at $23,491,228 on 1/3/05, collateralized by Federal
National Mortgage Assn., 5%--6%, 4/1/34--10/1/34,
with a value of $1,474,609,071
(Cost $23,487,000)                                           23,487,000       23,487,000
- -----------------------------------------------------------------------------------------
Total Investments, at Value (excluding Investments
Purchased with Cash Collateral from Securities
Loaned) (Cost $639,484,106)                                                  642,498,168

- -----------------------------------------------------------------------------------------
INVESTMENTS PURCHASED WITH CASH COLLATERAL
FROM SECURITIES LOANED--8.0%
- -----------------------------------------------------------------------------------------
ASSET-BACKED FLOATING SECURITY--0.5%
Money Market Trust, Series A-2,
2.478%, 1/18/05 9                                             1,000,000        1,000,000
- -----------------------------------------------------------------------------------------
Whitehawk CDO Funding Corp.,
2.56%, 3/15/05 9                                              1,500,000        1,500,000
                                                                          ---------------
                                                                               2,500,000

- -----------------------------------------------------------------------------------------
FUNDING AGREEMENT/GIC--0.2%
Allstate Life Insurance, 2.47%, 1/3/05 9                      1,000,000        1,000,000
- -----------------------------------------------------------------------------------------
MASTER FLOATING NOTES--0.5%
Bear Stearns, 2.493%, 1/3/05 9                                2,500,000        2,500,000
- -----------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--6.8%
Undivided interest of 10.70% in joint repurchase
agreement (Principal Amount/Value $155,205,723,
with a maturity value of $155,232,367) with
Credit Suisse First Boston LLC, 2.06%, dated
12/31/04, to be repurchased at $16,611,609
on 1/3/05, collateralized by AA
Corporate Bonds, 0%-15.73%, 1/1/06-7/16/44,
with a value of $155,312,640 9                               16,608,758       16,608,758
- -----------------------------------------------------------------------------------------
Undivided interest of 0.64% in joint repurchase
agreement (Principal Amount/Value $2,800,000,000,
with a maturity value of $2,800,550,669) with
Nomura Securities, 2.36%, dated 12/31/04, to
be repurchased at $17,829,212 on 1/3/05,
collateralized by U.S. Government Mortgage
Agencies, 2.58%-7.50%, 1/15/08-10/15/44,
with a value of $2,908,566,289 9                             17,825,706       17,825,706
                                                                          ---------------
                                                                              34,434,464
                                                                          ---------------

                                                                                   VALUE
                                                                              SEE NOTE 1
- -----------------------------------------------------------------------------------------
Total Investments Purchased with
Cash Collateral from Securities Loaned
(Cost $40,434,464)                                                        $   40,434,464

- -----------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $679,918,570)                                               134.5%     682,932,632
- -----------------------------------------------------------------------------------------
LIABILITIES IN EXCESS
OF OTHER ASSETS                                                   (34.5)    (175,183,897)
                                                          -------------------------------
NET ASSETS                                                        100.0%  $  507,748,735
                                                          ===============================



FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Illiquid security. The aggregate value of illiquid securities as of December
31, 2004 was $40,388,660, which represents 7.95% of the Fund's net assets. See
Note 8 of Notes to Financial Statements.

2. Represents the current interest rate for a variable or increasing rate
security.

3. When-issued security or forward commitment to be delivered and settled after
December 31, 2004. See Note 1 of Notes to Financial Statements.

4. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows. These securities amount to $14,368,673 or 2.83% of the Fund's net assets
as of December 31, 2004.

5. Principal-Only Strips represent the right to receive the monthly principal
payments on an underlying pool of mortgage loans. The value of these securities
generally increases as interest rates decline and prepayment rates rise. The
price of these securities is typically more volatile than that of coupon-bearing
bonds of the same maturity. Interest rates disclosed represent current yields
based upon the current cost basis and estimated timing of future cash flows.
These securities amount to $1,364,810 or 0.27% of the Fund's net assets as of
December 31, 2004.

6. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts with an aggregate
market value of $1,991,824. See Note 5 of Notes to Financial Statements.

7. 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 $25,217,888 or 4.97% of the Fund's net
assets as of December 31, 2004.

8. Non-income producing security.

9. The security has been segregated to satisfy the forward commitment to return
the cash collateral received in securities lending transactions upon the
borrower's return of the securities loaned. See Note 9 of Notes to Financial
Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          14 | OPPENHEIMER BOND FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- ------------------------------------------------------------------------------------------------------------------------------
ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Investments, at value (including securities loaned of $51,155,830) (cost $679,918,570)
- --see accompanying statement of investments                                                                     $ 682,932,632
- ------------------------------------------------------------------------------------------------------------------------------
Cash                                                                                                                  828,733
- ------------------------------------------------------------------------------------------------------------------------------
Collateral for securities loaned                                                                                   11,586,484
- ------------------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold on a when-issued basis or forward commitment                                                      68,831,464
Interest and principal paydowns                                                                                     5,194,261
Futures margins                                                                                                       321,360
Shares of beneficial interest sold                                                                                    290,800
Other                                                                                                                   9,802
                                                                                                                --------------
Total assets                                                                                                      769,995,536

- ------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ------------------------------------------------------------------------------------------------------------------------------
Return of collateral for securities loaned                                                                         52,020,948
- ------------------------------------------------------------------------------------------------------------------------------
Unrealized depreciation on swap contracts                                                                              17,661
- ------------------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased on a when-issued basis or forward commitment                                                208,447,267
Shares of beneficial interest redeemed                                                                              1,677,153
Shareholder communications                                                                                             36,833
Trustees' compensation                                                                                                 13,427
Distribution and service plan fees                                                                                      1,687
Transfer and shareholder servicing agent fees                                                                             873
Other                                                                                                                  30,952
                                                                                                                --------------
Total liabilities                                                                                                 262,246,801

- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                                      $ 507,748,735
                                                                                                                ==============

- ------------------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                                                      $      44,136
- ------------------------------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                                        510,879,953
- ------------------------------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                                                  24,100,215
- ------------------------------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments                                                                      (30,986,841)
- ------------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments                                                                          3,711,272
                                                                                                                --------------
NET ASSETS                                                                                                      $ 507,748,735
                                                                                                                ==============

- ------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ------------------------------------------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $504,243,728
and 43,830,804 shares of beneficial interest outstanding)                                                       $       11.50
- ------------------------------------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $3,505,007
and 305,477 shares of beneficial interest outstanding)                                                          $       11.47


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          15 | OPPENHEIMER BOND FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------
Interest                                               $ 20,877,006
- --------------------------------------------------------------------
Fee income                                                4,365,468
- --------------------------------------------------------------------
Portfolio lending fees                                       90,936
                                                       -------------
Total investment income                                  25,333,410

- --------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------
Management fees                                           4,013,043
- --------------------------------------------------------------------
Distribution and service plan fees--Service shares            7,476
- --------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                           10,097
Service shares                                                   17
- --------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                           48,974
Service shares                                                  255
- --------------------------------------------------------------------
Custodian fees and expenses                                  24,715
- --------------------------------------------------------------------
Trustees' compensation                                       14,913
- --------------------------------------------------------------------
Other                                                        34,434
                                                       -------------
Total expenses                                            4,153,924
Less reduction to custodian expenses                         (7,487)
                                                       -------------
Net expenses                                              4,146,437

- --------------------------------------------------------------------
NET INVESTMENT INCOME                                    21,186,973

- --------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------
Net realized gain on:
Investments                                               9,864,921
Closing of futures contracts                              4,887,384
Closing and expiration of swaption contracts                384,215
                                                       -------------
Net realized gain                                        15,136,520
- --------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                              (7,820,176)
Futures contracts                                           379,959
Swap contracts                                              (31,511)
                                                       -------------
Net change in unrealized appreciation                    (7,471,728)

- --------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS   $ 28,851,765
                                                       =============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          16 | OPPENHEIMER BOND FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                            2004             2003
- -------------------------------------------------------------------------------------------------------------------------

OPERATIONS
- -------------------------------------------------------------------------------------------------------------------------
Net investment income                                                                    $   21,186,973   $   28,002,301
- -------------------------------------------------------------------------------------------------------------------------
Net realized gain                                                                            15,136,520       14,994,207
- -------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation                                                        (7,471,728)       2,326,132
                                                                                         --------------------------------
Net increase in net assets resulting from operations                                         28,851,765       45,322,640

- -------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- -------------------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                                          (27,226,980)     (40,547,869)
Service shares                                                                                 (159,134)        (196,017)

- -------------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- -------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares                                                                         (115,482,453)    (111,087,827)
Service shares                                                                                 (303,187)       1,355,244

- -------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- -------------------------------------------------------------------------------------------------------------------------
Total decrease                                                                             (114,319,989)    (105,153,829)
- -------------------------------------------------------------------------------------------------------------------------
Beginning of period                                                                         622,068,724      727,222,553
                                                                                         --------------------------------
End of period (including accumulated net investment income of $24,100,215
and $27,335,903, respectively)                                                           $  507,748,735   $  622,068,724
                                                                                         ================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          17 | OPPENHEIMER BOND FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                2004          2003          2002          2001          2000
- --------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                  $   11.42     $   11.31     $   11.21     $   11.25     $   11.52
- --------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                       .43 1         .51           .65           .81           .94
Net realized and unrealized gain (loss)                     .18           .23           .27           .03          (.29)
Payment from affiliate                                       --            --           .01            --            --
                                                      --------------------------------------------------------------------
Total from investment operations                            .61           .74           .93           .84           .65
- --------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                       (.53)         (.63)         (.83)         (.88)         (.92)
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                        $   11.50     $   11.42     $   11.31     $   11.21     $   11.25
                                                      ====================================================================

- --------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN:
- --------------------------------------------------------------------------------------------------------------------------
Total return at net asset value 2                          5.49%         6.78%         9.02%         7.79%         6.10%
Total return before payment from affiliate 3                N/A           N/A          8.93%          N/A           N/A

- --------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)              $ 504,244     $ 618,234     $ 724,787     $ 693,701     $ 562,345
- --------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                     $ 552,293     $ 691,931     $ 686,932     $ 638,820     $ 557,873
- --------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income before payment from affiliate        3.82%         4.03%         5.91% 3       7.93%         7.94%
Net investment income after payment from affiliate          N/A           N/A          6.07%          N/A           N/A
Total expenses                                             0.75% 5       0.73% 5       0.73% 5       0.77% 5       0.76% 5
- --------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                      95% 6        101%          157%          186%          260%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. The Manager voluntarily reimbursed the Class $1,107,704 from an error in the
calculation of the Fund's net asset value per share.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

6. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$2,841,348,053 and $2,925,500,296, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          18 | OPPENHEIMER BOND FUND/VA




SERVICE SHARES  YEAR ENDED DECEMBER 31,                  2004         2003       2002 1
- --------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------
Net asset value, beginning of period                  $ 11.39      $ 11.30      $ 10.46
- --------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income                                     .40 2        .43          .11
Net realized and unrealized gain                          .18          .28          .72
Payment from affiliate                                     --           --          .01
                                                      --------------------------------------
Total from investment operations                          .58          .71          .84
- --------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                     (.50)        (.62)          --
- --------------------------------------------------------------------------------------------
Net asset value, end of period                        $ 11.47      $ 11.39      $ 11.30
                                                      ======================================

- --------------------------------------------------------------------------------------------
TOTAL RETURN:
- --------------------------------------------------------------------------------------------
Total return at net asset value 3                        5.22%        6.56%        8.03%
Total return before payment from affiliate 4              N/A          N/A         7.94%

- --------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)              $ 3,505      $ 3,835      $ 2,435
- --------------------------------------------------------------------------------------------
Average net assets (in thousands)                     $ 3,002      $ 3,903      $   834
- --------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment income before payment from affiliate      3.55%        3.73%        4.37% 4
Net investment income after payment from affiliate        N/A          N/A         5.04%
Total expenses                                           0.99% 6      0.98% 6      0.98% 6,7
- --------------------------------------------------------------------------------------------
Portfolio turnover rate                                    95% 8       101%         157%


1. For the period from May 1, 2002 (inception of offering) to December 31, 2002.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. The Manager voluntarily reimbursed the Class $3,723 from an error in the
calculation of the Fund's net asset value per share.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

7. Voluntary waiver of transfer agent fees less than 0.01%.

8. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$2,841,348,053 and $2,925,500,296, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          19 | OPPENHEIMER BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Bond Fund/VA (the Fund) is a separate series of Oppenheimer Variable
Account Funds (the Trust), an open-end management investment company registered
under the Investment Company Act of 1940, as amended. The Fund's main investment
objective is to seek a high level of current income. The Trust's investment
advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
STRUCTURED NOTES. The Fund invests in structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss when
a structured note is sold or matures. As of December 31, 2004, the market value
of these securities comprised 3.0% of the Fund's net assets and resulted in
unrealized cumulative losses of $45,900.

- --------------------------------------------------------------------------------
SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment
for securities that have been purchased by the Fund on a when-issued basis or
forward commitment can take place up to ten days or more after the trade date.
Normally the settlement date occurs within six months after the trade date;
however, the Fund may, from time to time, purchase securities whose settlement
date extends six months or more beyond trade date. During this period, such
securities do not earn interest, are subject to market fluctuation and may
increase or decrease in value prior to their delivery. The Fund maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The purchase of securities on a when-issued
basis or forward commitment may increase the volatility of the Fund's net asset
value to the extent the Fund executes such transactions while


                          20 | OPPENHEIMER BOND FUND/VA


remaining substantially fully invested. The Fund may also sell securities that
it purchased on a when-issued basis or forward commitment prior to settlement of
the original purchase. As of December 31, 2004, the Fund had purchased
$208,447,267 of securities on a when-issued basis or forward commitment and sold
$68,831,464 of securities issued on a when-issued basis or forward commitment.

      In connection with its ability to purchase or sell securities on a
when-issued basis, the Fund may enter into forward roll transactions with
respect to mortgage-related securities. Forward roll transactions require the
sale of securities for delivery in the current month, and a simultaneous
agreement with the same counterparty to repurchase similar (same type, coupon
and maturity) but not identical securities on a specified future date. The Fund
records the incremental difference between the forward purchase and sale of each
forward roll as realized gain (loss) on investments or as fee income in the case
of such transactions that have an associated fee in lieu of a difference in the
forward purchase and sale price.

      Risks of entering into forward roll transactions include the potential
inability of the counterparty to meet the terms of the agreement; the potential
of the Fund to receive inferior securities at redelivery as compared to the
securities sold to the counterparty; counterparty credit risk; and the potential
pay down speed variance between the mortgage-related pools.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.



                                                                       NET UNREALIZED
                                                                         APPRECIATION
                                                                     BASED ON COST OF
                                                                       SECURITIES AND
           UNDISTRIBUTED    UNDISTRIBUTED    ACCUMULATED            OTHER INVESTMENTS
           NET INVESTMENT       LONG-TERM           LOSS           FOR FEDERAL INCOME
           INCOME                    GAIN   CARRYFORWARD 1,2,3,4         TAX PURPOSES
           --------------------------------------------------------------------------

           $ 25,178,703              $ --   $ 30,220,954                  $ 1,876,687


1. As of December 31, 2004, the Fund had $29,885,554 of net capital loss
carryforward available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforward were as follows:

                        EXPIRING
                        -----------------------
                        2010       $ 29,885,554

2. As of December 31, 2004, the Fund had $335,400 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

3. During the fiscal year ended December 31, 2004, the Fund utilized $9,566,561
of capital loss carryforward to offset capital gains realized in that fiscal
year.

4. During the fiscal year ended December 31, 2003, the Fund utilized $18,880,076
of capital loss carryforward to offset capital gains realized in that fiscal
year.


                          21 | OPPENHEIMER BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

              INCREASE TO          INCREASE TO
              ACCUMULATED      ACCUMULATED NET
              NET INVESTMENT     REALIZED LOSS
              INCOME            ON INVESTMENTS
              --------------------------------
              $ 2,963,453       $ 2,963,453

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                                YEAR ENDED          YEAR ENDED
                                         DECEMBER 31, 2004   DECEMBER 31, 2003
              ----------------------------------------------------------------
              Distributions paid from:
              Ordinary income            $ 27,386,114        $ 40,743,886

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

              Federal tax cost of securities          $ 680,941,048
              Federal tax cost of other investments     (48,656,076)
                                                      -------------
              Total federal tax cost                  $ 632,284,972
                                                      =============
              Gross unrealized appreciation           $  11,161,154
              Gross unrealized depreciation              (9,284,467)
                                                      -------------
              Net unrealized appreciation             $   1,876,687
                                                      =============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.


                          22 | OPPENHEIMER BOND FUND/VA


- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                                            YEAR ENDED DECEMBER 31, 2004    YEAR ENDED DECEMBER 31, 2003
                                                SHARES            AMOUNT         SHARES           AMOUNT
- --------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                          1,867,203   $   21,055,436      6,666,784   $   75,024,613
Dividends and/or distributions reinvested     2,424,486       27,226,980      3,719,988       40,547,869
Redeemed                                    (14,578,269)    (163,764,869)   (20,335,565)    (226,660,309)
                                            -------------------------------------------------------------
Net decrease                                (10,286,580)  $ (115,482,453)    (9,948,793)  $ (111,087,827)
                                            =============================================================

- ---------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                            132,217   $    1,497,198        507,273   $    5,712,858
Dividends and/or distributions reinvested        14,183          159,134         18,016          196,017
Redeemed                                       (177,573)      (1,959,519)      (404,048)      (4,553,631)
                                            -------------------------------------------------------------
Net increase (decrease)                         (31,173)  $     (303,187)       121,241   $    1,355,244
                                            =============================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than U.S. government obligations and short-term obligations, for the year ended
December 31, 2004, were $298,410,160 and $338,058,617, respectively. There were
purchases of $157,786,344 and sales of $233,884,344 of U.S. government and
government agency obligations for the year ended December 31, 2004. In addition,
there were purchases of $2,841,348,053 and sales of $2,925,500,296 of To Be
Announced (TBA) mortgage-related securities for the year ended December 31,
2004.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% on the next $200 million and 0.50% of average annual
net assets over $1 billion.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.


                          23 | OPPENHEIMER BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued

TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$10,076 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees for all classes to 0.35% of average annual
net assets per class. This undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FUTURES CONTRACTS

A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures) or debt securities (interest rate futures) in order to gain
exposure to or protection from changes in market value of stocks and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.

      The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it may
be more efficient or cost effective than actually buying securities.

      Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.

      Cash held by the broker to cover initial margin requirements on open
futures contracts is noted in the Statement of Assets and Liabilities.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable and/or payable for the
daily mark to market for variation margin. Realized gains and losses are
reported in the Statement of Operations as the closing and expiration of futures
contracts. The net change in unrealized appreciation and depreciation is
reported in the Statement of Operations.

      Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.


                          24 | OPPENHEIMER BOND FUND/VA


As of December 31, 2004, the Fund had outstanding futures contracts as follows:



                                                                              UNREALIZED
                             EXPIRATION   NUMBER OF     VALUATION AS OF     APPRECIATION
CONTRACT DESCRIPTION              DATES   CONTRACTS   DECEMBER 31, 2004   (DEPRECIATION)
- ----------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
U.S. Long Bonds                 3/21/05         552        $ 62,100,000        $ 682,292
U.S. Treasury Nts., 10 yr.      3/21/05          25           2,798,438           11,234
                                                                               ----------
                                                                                 693,526
                                                                               ==========
CONTRACTS TO SELL
U.S. Treasury Nts., 2 yr.       3/31/05         363          76,082,531           71,569
U.S. Treasury Nts., 5 yr.       3/21/05         343          37,569,219          (50,224)
                                                                               ----------
                                                                                  21,345
                                                                               ----------
                                                                               $ 714,871
                                                                               ==========


- --------------------------------------------------------------------------------
6. CREDIT SWAP CONTRACTS

The Fund may enter into a credit swap transaction to maintain a total return on
a particular investment or portion of its portfolio, or for other
non-speculative purposes. Because the principal amount is not exchanged, it
represents neither an asset nor a liability to either counterparty, and is
referred to as a notional principal amount. The Fund records an increase or
decrease to unrealized gain (loss), in the amount due to or owed by the Fund at
termination or settlement. Credit swaps are subject to credit risks (if the
counterparty fails to meet its obligations). The Fund pays an annual interest
fee on the notional amount in exchange for the counterparty paying in a
potential credit event.

During the year ended December 31, 2004, the Fund entered into transactions to
hedge credit risk. Information regarding the credit swaps is as follows:




                                         EXPIRATION       NOTIONAL     VALUATION AS OF     UNREALIZED
CONTRACT DESCRIPTION                           DATE         AMOUNT   DECEMBER 31, 2004   DEPRECIATION
- -----------------------------------------------------------------------------------------------------

Morgan Stanley Capital Services, Inc.,
Dow Jones CDX.NA.IG.3 Index
Credit Bonds                                3/20/10   $ 30,000,000           $ (87,327)      $ 87,327


- --------------------------------------------------------------------------------
7. TOTAL RETURN SWAP CONTRACTS

The Fund may enter into a total return swap transaction to maintain a total
return on a particular investment, or portion of its portfolio, or for other
non-speculative purposes. Because the principal amount is not exchanged, it
represents neither an asset nor a liability to either counterparty, and is
referred to as notional. The Fund records an increase or decrease to unrealized
gain (loss), in the amount due to or owed by the Fund at termination or
settlement. Total return swaps are subject to risks (if the counterparty fails
to meet its obligations).

As of December 31, 2004, the Fund had entered into the following total return
swap agreements:



                                      NOTIONAL   PAID BY THE FUND AT   RECEIVED BY THE FUND AT   TERMINATION     UNREALIZED
SWAP COUNTERPARTY                       AMOUNT     DECEMBER 31, 2004         DECEMBER 31, 2004         DATES   APPRECIATION
- ---------------------------------------------------------------------------------------------------------------------------

                                                                                      Value of
                                                           One-Month           total return of
                                                          LIBOR less           Lehman Brothers
Deutsche Bank AG                   $ 7,500,000       50 basis points                CMBS Index        1/1/05       $ 37,365
                                                                                      Value of
                                                                               total return of
                                                           One-Month           Lehman Brothers
Goldman Sachs Capital Markets LP     7,500,000             LIBOR BBA                CMBS Index       3/31/05         32,301
                                                                                                                   --------
                                                                                                                   $ 69,666
                                                                                                                   ========


Index abbreviations are as follows:
CMBS      Commercial Mortgage Backed Securities Markets
LIBOR     London-Interbank Offered Rate
LIBOR BBA London-Interbank Offered Rate British Bankers Association


                          25 | OPPENHEIMER BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
8. ILLIQUID SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 15% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities.

- --------------------------------------------------------------------------------
9. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had on loan securities valued at $51,155,830. Cash of $52,020,948 was
received as collateral for the loans, of which $40,434,464 was invested in
approved instruments.

- --------------------------------------------------------------------------------
10. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER CAPITAL APPRECIATION
FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Capital Appreciation Fund/VA, a series of Oppenheimer Variable
Account Funds, including the statement of investments, as of December 31, 2004,
and the related statement of operations for the year then ended, the statements
of changes in net assets for each of the two years in the period then ended, and
the financial highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Capital Appreciation Fund/VA as of December 31, 2004, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005



STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                        SHARES       SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--97.1%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--18.7%
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--1.9%
Carnival Corp.                                         325,500   $    18,758,565
- --------------------------------------------------------------------------------
Royal Caribbean Cruises Ltd.                           358,200        19,500,408
                                                                 ---------------
                                                                      38,258,973

- --------------------------------------------------------------------------------
MEDIA--11.7%
Clear Channel Communications, Inc.                     437,300        14,645,177
- --------------------------------------------------------------------------------
Comcast Corp., Cl. A Special,
Non-Vtg. 1                                           1,955,800        64,228,472
- --------------------------------------------------------------------------------
News Corp., Inc., Cl. B                              1,332,400        25,582,080
- --------------------------------------------------------------------------------
Omnicom Group, Inc.                                    103,300         8,710,256
- --------------------------------------------------------------------------------
Time Warner, Inc. 1                                  2,280,700        44,336,808
- --------------------------------------------------------------------------------
Univision Communications, Inc., Cl. A 1                444,165        13,000,710
- --------------------------------------------------------------------------------
Viacom, Inc., Cl. B                                  1,264,300        46,007,877
- --------------------------------------------------------------------------------
Walt Disney Co. (The)                                  677,000        18,820,600
                                                                 ---------------
                                                                     235,331,980

- --------------------------------------------------------------------------------
MULTILINE RETAIL--2.0%
Federated Department Stores, Inc.                      209,700        12,118,563
- --------------------------------------------------------------------------------
J.C. Penney Co., Inc. (Holding Co.)                    122,800         5,083,920
- --------------------------------------------------------------------------------
Target Corp.                                           459,600        23,867,028
                                                                 ---------------
                                                                      41,069,511

- --------------------------------------------------------------------------------
SPECIALTY RETAIL--3.1%
Best Buy Co., Inc.                                     231,700        13,767,614
- --------------------------------------------------------------------------------
Gap, Inc. (The)                                        828,800        17,504,256
- --------------------------------------------------------------------------------
Home Depot, Inc.                                       394,100        16,843,834
- --------------------------------------------------------------------------------
Lowe's Cos., Inc.                                      176,100        10,141,599
- --------------------------------------------------------------------------------
Williams-Sonoma, Inc. 1                                114,900         4,026,096
                                                                 ---------------
                                                                      62,283,399

- --------------------------------------------------------------------------------
CONSUMER STAPLES--7.6%
- --------------------------------------------------------------------------------
BEVERAGES--2.9%
Anheuser-Busch Cos., Inc.                              382,000        19,378,860
- --------------------------------------------------------------------------------
Coca-Cola Co. (The)                                    146,100         6,082,143
- --------------------------------------------------------------------------------
PepsiCo, Inc.                                          629,200        32,844,240
                                                                 ---------------
                                                                      58,305,243

- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--2.5%
Costco Wholesale Corp.                                 227,800        11,027,798
- --------------------------------------------------------------------------------
Wal-Mart Stores, Inc.                                  644,100        34,021,362
- --------------------------------------------------------------------------------
Walgreen Co.                                           130,500         5,007,285
                                                                 ---------------
                                                                      50,056,445


                                                                          VALUE
                                                        SHARES       SEE NOTE 1
- --------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--1.6%
Kimberly-Clark Corp.                                    70,200   $     4,619,862
- --------------------------------------------------------------------------------
Procter & Gamble Co. (The)                             529,500        29,164,860
                                                                 ---------------
                                                                      33,784,722

- --------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.6%
Estee Lauder Cos., Inc. (The), Cl. A                   255,800        11,707,966
- --------------------------------------------------------------------------------
ENERGY--4.4%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.8%
Halliburton Co.                                         36,100         1,416,564
- --------------------------------------------------------------------------------
Schlumberger Ltd.                                      221,600        14,836,120
                                                                 ---------------
                                                                      16,252,684

- --------------------------------------------------------------------------------
OIL & GAS--3.6%
Amerada Hess Corp.                                      81,900         6,746,922
- --------------------------------------------------------------------------------
Burlington Resources, Inc.                             136,300         5,929,050
- --------------------------------------------------------------------------------
Devon Energy Corp.                                     105,400         4,102,168
- --------------------------------------------------------------------------------
Exxon Mobil Corp.                                      792,700        40,633,802
- --------------------------------------------------------------------------------
Kinder Morgan Management LLC                           249,768        10,165,558
- --------------------------------------------------------------------------------
Murphy Oil Corp.                                        69,600         5,599,320
                                                                 ---------------
                                                                      73,176,820

- --------------------------------------------------------------------------------
FINANCIALS--10.9%
- --------------------------------------------------------------------------------
COMMERCIAL BANKS--0.5%
Bank of America Corp.                                  216,200        10,159,238
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--8.3%
American Express Co.                                   435,500        24,549,135
- --------------------------------------------------------------------------------
Bear Stearns Cos., Inc. (The)                          112,900        11,550,799
- --------------------------------------------------------------------------------
Citigroup, Inc.                                        977,500        47,095,950
- --------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The)                        116,300        12,099,852
- --------------------------------------------------------------------------------
JPMorgan Chase & Co.                                   627,028        24,460,362
- --------------------------------------------------------------------------------
MBNA Corp.                                             369,100        10,404,929
- --------------------------------------------------------------------------------
Morgan Stanley                                         660,500        36,670,960
                                                                 ---------------
                                                                     166,831,987

- --------------------------------------------------------------------------------
INSURANCE--2.1%
American International Group, Inc.                     381,550        25,056,389
- --------------------------------------------------------------------------------
Prudential Financial, Inc.                             245,700        13,503,672
- --------------------------------------------------------------------------------
XL Capital Ltd., Cl. A                                  59,200         4,596,880
                                                                 ---------------
                                                                      43,156,941

- --------------------------------------------------------------------------------
HEALTH CARE--16.1%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--3.1%
Amgen, Inc. 1                                          423,800        27,186,770
- --------------------------------------------------------------------------------
Applera Corp./Applied
Biosystems Group                                       167,700         3,506,607
- --------------------------------------------------------------------------------
Digene Corp. 1                                          92,200         2,411,030
- --------------------------------------------------------------------------------
Genentech, Inc. 1                                      183,100         9,967,964
- --------------------------------------------------------------------------------
Gilead Sciences, Inc. 1                                469,400        16,424,306


            7 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
BIOTECHNOLOGY Continued
MedImmune, Inc. 1                                      124,600   $     3,377,906
                                                                 ---------------
                                                                      62,874,583

- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--4.4%
Medtronic, Inc.                                        787,700        39,125,059
- --------------------------------------------------------------------------------
Millipore Corp. 1                                      364,700        18,165,707
- --------------------------------------------------------------------------------
PerkinElmer, Inc.                                      396,300         8,912,787
- --------------------------------------------------------------------------------
Stryker Corp.                                          286,900        13,842,925
- --------------------------------------------------------------------------------
Varian Medical Systems, Inc. 1                          89,500         3,869,980
- --------------------------------------------------------------------------------
Waters Corp. 1                                          83,500         3,906,965
                                                                 ---------------
                                                                      87,823,423

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--0.4%
Laboratory Corp. of America Holdings 1                  77,300         3,851,086
- --------------------------------------------------------------------------------
Pharmaceutical Product Development, Inc. 1              70,600         2,915,074
- --------------------------------------------------------------------------------
Quest Diagnostics, Inc.                                 21,200         2,025,660
                                                                 ---------------
                                                                       8,791,820

- --------------------------------------------------------------------------------
PHARMACEUTICALS--8.2%
Abbott Laboratories                                     86,400         4,030,560
- --------------------------------------------------------------------------------
Eli Lilly & Co.                                        307,000        17,422,250
- --------------------------------------------------------------------------------
Johnson & Johnson                                      633,600        40,182,912
- --------------------------------------------------------------------------------
Merck & Co., Inc.                                      403,867        12,980,285
- --------------------------------------------------------------------------------
Novartis AG                                            497,588        25,074,129
- --------------------------------------------------------------------------------
Pfizer, Inc.                                         1,437,300        38,648,997
- --------------------------------------------------------------------------------
Roche Holdings AG                                       45,716         5,262,707
- --------------------------------------------------------------------------------
Teva Pharmaceutical Industries
Ltd., Sponsored ADR                                    707,396        21,122,845
                                                                 ---------------
                                                                     164,724,685

- --------------------------------------------------------------------------------
INDUSTRIALS--13.0%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--3.3%
Empresa Brasileira de Aeronautica SA, ADR              325,000        10,868,000
- --------------------------------------------------------------------------------
Honeywell International, Inc.                          217,600         7,705,216
- --------------------------------------------------------------------------------
L-3 Communications Holdings, Inc.                      127,900         9,367,396
- --------------------------------------------------------------------------------
Lockheed Martin Corp.                                  284,300        15,792,865
- --------------------------------------------------------------------------------
Northrop Grumman Corp.                                 111,700         6,072,012
- --------------------------------------------------------------------------------
Rockwell Collins, Inc.                                  37,700         1,486,888
- --------------------------------------------------------------------------------
United Technologies Corp.                              154,700        15,988,245
                                                                 ---------------
                                                                      67,280,622

- --------------------------------------------------------------------------------
AIR FREIGHT & LOGISTICS--2.0%
Expeditors International of Washington, Inc.           180,500        10,086,340
- --------------------------------------------------------------------------------
FedEx Corp.                                            122,600        12,074,874


                                                                          VALUE
                                                        SHARES       SEE NOTE 1
- --------------------------------------------------------------------------------
AIR FREIGHT & LOGISTICS Continued
United Parcel Service, Inc., Cl. B                     213,100   $    18,211,526
                                                                 ---------------
                                                                      40,372,740

- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--0.9%
Manpower, Inc.                                          96,300         4,651,290
- --------------------------------------------------------------------------------
Waste Management, Inc.                                 464,900        13,919,106
                                                                 ---------------
                                                                      18,570,396

- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.1%
Rockwell Automation, Inc.                               47,300         2,343,715
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--5.9%
General Electric Co.                                 2,802,900       102,305,850
- --------------------------------------------------------------------------------
Tyco International Ltd.                                467,600        16,712,024
                                                                 ---------------
                                                                     119,017,874

- --------------------------------------------------------------------------------
MACHINERY--0.8%
Ingersoll-Rand Co., Cl. A                              186,300        14,959,890
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--22.4%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--4.1%
Cisco Systems, Inc. 1                                2,029,200        39,163,560
- --------------------------------------------------------------------------------
Lucent Technologies, Inc. 1                          1,925,200         7,238,752
- --------------------------------------------------------------------------------
Motorola, Inc.                                         645,800        11,107,760
- --------------------------------------------------------------------------------
Nokia Corp., Sponsored ADR                             957,200        14,999,324
- --------------------------------------------------------------------------------
Telefonaktiebolaget LM Ericsson,
Sponsored ADR 1                                        313,900         9,884,711
                                                                 ---------------
                                                                      82,394,107

- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--3.9%
Dell, Inc. 1                                           474,300        19,987,002
- --------------------------------------------------------------------------------
EMC Corp. 1                                            249,300         3,707,091
- --------------------------------------------------------------------------------
International Business
Machines Corp.                                         472,700        46,598,766
- --------------------------------------------------------------------------------
Sun Microsystems, Inc. 1                             1,462,200         7,866,636
                                                                 ---------------
                                                                      78,159,495

- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--1.5%
Agilent Technologies, Inc. 1                           496,200        11,958,420
- --------------------------------------------------------------------------------
Ingram Micro, Inc., Cl. A 1                            381,000         7,924,800
- --------------------------------------------------------------------------------
Tektronix, Inc.                                        357,800        10,809,138
                                                                 ---------------
                                                                      30,692,358

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--1.6%
VeriSign, Inc. 1                                        44,400         1,488,288
- --------------------------------------------------------------------------------
Yahoo!, Inc. 1                                         796,600        30,015,888
                                                                 ---------------
                                                                      31,504,176

- --------------------------------------------------------------------------------
IT SERVICES--0.3%
Accenture Ltd., Cl. A 1                                231,400         6,247,800


            8 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--3.7%
Altera Corp. 1                                         149,800   $     3,100,860
- --------------------------------------------------------------------------------
Analog Devices, Inc.                                   251,600         9,289,072
- --------------------------------------------------------------------------------
Broadcom Corp., Cl. A 1                                321,000        10,361,880
- --------------------------------------------------------------------------------
Intel Corp.                                          1,578,100        36,911,759
- --------------------------------------------------------------------------------
Texas Instruments, Inc.                                601,500        14,808,930
                                                                 ---------------
                                                                      74,472,501

- --------------------------------------------------------------------------------
SOFTWARE--7.3%
Adobe Systems, Inc.                                    374,100        23,471,034
- --------------------------------------------------------------------------------
Cadence Design Systems, Inc. 1                         517,200         7,142,532
- --------------------------------------------------------------------------------
Citrix Systems, Inc. 1                                 393,500         9,652,555
- --------------------------------------------------------------------------------
Mercury Interactive Corp. 1                            222,800        10,148,540
- --------------------------------------------------------------------------------
Microsoft Corp.                                      2,760,400        73,730,284
- --------------------------------------------------------------------------------
Novell, Inc. 1                                         323,400         2,182,950
- --------------------------------------------------------------------------------
SAP AG, Sponsored ADR                                  499,000        22,060,789
                                                                 ---------------
                                                                     148,388,684

- --------------------------------------------------------------------------------
MATERIALS--2.7%
- --------------------------------------------------------------------------------
CHEMICALS--2.6%
Air Products & Chemicals, Inc.                         258,600        14,991,042
- --------------------------------------------------------------------------------
Dow Chemical Co.                                        88,800         4,396,488
- --------------------------------------------------------------------------------
E.I. DuPont de Nemours & Co.                           288,500        14,150,925
- --------------------------------------------------------------------------------
Praxair, Inc.                                          455,600        20,114,740
                                                                 ---------------
                                                                      53,653,195

- --------------------------------------------------------------------------------
METALS & MINING--0.1%
Alcan, Inc.                                             38,800         1,902,752
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--1.3%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--1.1%
Sprint Corp.                                           450,800        11,202,380
- --------------------------------------------------------------------------------
Telefonos de Mexico SA de CV,
Sponsored ADR                                          294,600        11,289,072
                                                                 ---------------
                                                                      22,491,452

- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--0.2%
AT&T Corp.                                             196,900         3,752,914
                                                                 ---------------
Total Common Stocks
(Cost $1,800,967,668)                                              1,960,795,091

                                                                           VALUE
                                                         UNITS        SEE NOTE 1
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- --------------------------------------------------------------------------------
Lucent Technologies, Inc. Wts.,
Exp. 12/10/07 1 (Cost $0)                               84,120   $       132,910

                                                     PRINCIPAL
                                                        AMOUNT
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--3.1%
- --------------------------------------------------------------------------------
Undivided interest of 4.34% in joint
repurchase agreement (Principal Amount/Value
$1,443,703,000, with a maturity value of
$1,443,962,867) with UBS Warburg LLC, 2.16%,
dated 12/31/04, to be repurchased at
$62,698,284 on 1/3/05, collateralized by
Federal National Mortgage Assn., 5%--6%,
4/1/34--10/1/34, with a value of
$1,474,609,071 (Cost $62,687,000)                 $ 62,687,000       62,687,000

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $1,863,654,668)                                    100.2%   2,023,615,001
- --------------------------------------------------------------------------------
LIABILITIES IN EXCESS
OF OTHER ASSETS                                           (0.2)      (4,692,277)
                                                  ------------------------------
NET ASSETS                                               100.0%  $2,018,922,724
                                                  ==============================

FOOTNOTE TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            9 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- ----------------------------------------------------------------------------------------------------------------------
ASSETS
- ----------------------------------------------------------------------------------------------------------------------
Investments, at value (cost $1,863,654,668)--see accompanying statement of investments                $ 2,023,615,001
- ----------------------------------------------------------------------------------------------------------------------
Cash                                                                                                          294,467
- ----------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold                                                                                            4,968,096
Interest and dividends                                                                                      1,981,833
Shares of beneficial interest sold                                                                          1,782,291
Other                                                                                                          18,729
                                                                                                      ----------------
Total assets                                                                                            2,032,660,417

- ----------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ----------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased                                                                                      12,631,037
Shares of beneficial interest redeemed                                                                        819,695
Distribution and service plan fees                                                                            141,957
Shareholder communications                                                                                     61,796
Trustees' compensation                                                                                         27,565
Transfer and shareholder servicing agent fees                                                                   1,773
Other                                                                                                          53,870
                                                                                                      ----------------
Total liabilities                                                                                          13,737,693

- ----------------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                            $ 2,018,922,724
                                                                                                      ================

- ----------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ----------------------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                                            $        54,633
- ----------------------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                              2,126,705,195
- ----------------------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                                          17,399,802
- ----------------------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions                           (285,201,028)
- ----------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies                                                                         159,964,122
                                                                                                      ----------------
NET ASSETS                                                                                            $ 2,018,922,724
                                                                                                      ================

- ----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ----------------------------------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based
on net assets of $1,770,273,281 and 47,863,861 shares of beneficial interest outstanding)             $         36.99
- ----------------------------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share (based
on net assets of $248,649,443 and 6,769,088 shares of beneficial interest outstanding)                $         36.73


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            10 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------



- ----------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
- ----------------------------------------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $167,336)                                              $    30,583,919
- ----------------------------------------------------------------------------------------------------------------------
Interest                                                                                                      821,751
                                                                                                      ----------------
Total investment income                                                                                    31,405,670

- ----------------------------------------------------------------------------------------------------------------------
EXPENSES
- ----------------------------------------------------------------------------------------------------------------------
Management fees                                                                                            12,193,670
- ----------------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                                                            459,798
- ----------------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                                                             10,276
Service shares                                                                                                 10,036
- ----------------------------------------------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                                                             90,788
Service shares                                                                                                 11,222
- ----------------------------------------------------------------------------------------------------------------------
Custodian fees and expenses                                                                                    48,830
- ----------------------------------------------------------------------------------------------------------------------
Trustees' compensation                                                                                         35,958
- ----------------------------------------------------------------------------------------------------------------------
Other                                                                                                          79,122
                                                                                                      ----------------
Total expenses                                                                                             12,939,700
Less reduction to custodian expenses                                                                           (5,579)
                                                                                                      ----------------
Net expenses                                                                                               12,934,121

- ----------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                                                      18,471,549

- ----------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- ----------------------------------------------------------------------------------------------------------------------
Net realized gain on:
Investments                                                                                                81,657,867
Foreign currency transactions                                                                               1,248,945
Net increase from payment by affiliate                                                                        153,724
                                                                                                      ----------------
Net realized gain                                                                                          83,060,536
- ----------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                                                                25,551,439
Translation of assets and liabilities denominated in foreign currencies                                     1,809,774
                                                                                                      ----------------
Net change in unrealized appreciation                                                                      27,361,213

- ----------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                                                  $   128,893,298
                                                                                                      ================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            11 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                       2004               2003
- ----------------------------------------------------------------------------------------------------------------------

OPERATIONS
- ----------------------------------------------------------------------------------------------------------------------
Net investment income                                                               $   18,471,549    $     5,758,596
- ----------------------------------------------------------------------------------------------------------------------
Net realized gain (loss)                                                                83,060,536       (149,446,395)
- ----------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                                    27,361,213        558,998,061
                                                                                    ----------------------------------
Net increase in net assets resulting from operations                                   128,893,298        415,310,262

- ----------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ----------------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                                      (5,404,905)        (5,643,286)
Service shares                                                                            (357,596)           (84,026)

- ----------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ----------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest
transactions:
Non-Service shares                                                                     (53,964,830)       (18,705,242)
Service shares                                                                         114,818,206         87,031,915

- ----------------------------------------------------------------------------------------------------------------------
NET ASSETS
- ----------------------------------------------------------------------------------------------------------------------
Total increase                                                                         183,984,173        477,909,623
- ----------------------------------------------------------------------------------------------------------------------
Beginning of period                                                                  1,834,938,551      1,357,028,928
                                                                                    ----------------------------------
End of period (including accumulated net investment income of $17,399,802
and $5,752,602, respectively)                                                       $2,018,922,724    $ 1,834,938,551
                                                                                    ==================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            12 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------


NON-SERVICE SHARES   YEAR ENDED DECEMBER 31,                  2004           2003            2002            2001            2000
- ------------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $     34.70    $     26.62     $     36.58     $     46.63     $     49.84
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                          .35 1          .12             .11             .18             .27
Net realized and unrealized gain (loss)                       2.05           8.07           (9.89)          (5.86)            .02
                                                       -----------------------------------------------------------------------------
Total from investment operations                              2.40           8.19           (9.78)          (5.68)            .29
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                          (.11)          (.11)           (.18)           (.27)           (.06)
Distributions from net realized gain                            --             --              --           (4.10)          (3.44)
                                                       -----------------------------------------------------------------------------
Total dividends and/or distributions to shareholders          (.11)          (.11)           (.18)          (4.37)          (3.50)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $     36.99    $     34.70     $     26.62     $     36.58     $     46.63
                                                       =============================================================================

- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                            6.93%         30.94%         (26.86)%        (12.58)%         (0.23)%
- ------------------------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $ 1,770,273    $ 1,715,240     $ 1,338,769     $ 1,975,345     $ 2,095,803
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $ 1,708,511    $ 1,468,297     $ 1,630,430     $ 2,000,314     $ 1,922,099
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                         0.99%          0.39%           0.35%           0.51%           0.66%
Total expenses                                                0.66% 4        0.67% 4         0.66% 4         0.68% 4         0.67% 4
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                         44%            48%             32%             45%             38%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            13 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------



SERVICE SHARES   YEAR ENDED DECEMBER 31,                      2004          2003             2002        2001 1
- ------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $     34.53    $    26.53      $     36.56       $ 31.66
- ------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                          .29 2         .08              .20            -- 3
Net realized and unrealized gain (loss)                       1.99          8.02           (10.05)         4.90
                                                       -----------------------------------------------------------
Total from investment operations                              2.28          8.10            (9.85)         4.90
- ------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                          (.08)         (.10)            (.18)           --
Distributions from net realized gain                            --            --               --            --
                                                       -----------------------------------------------------------
Total dividends and/or distributions to shareholders          (.08)         (.10)            (.18)           --
- ------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $     36.73    $    34.53      $     26.53       $ 36.56
                                                       ===========================================================

- ------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 4                            6.62%        30.69%          (27.09)%       15.51%
- ------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $   248,649    $  119,699      $    18,260       $    90
- ------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $   184,273    $   48,178      $     6,263       $    16
- ------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment income                                         0.85%         0.14%            0.26%         0.11%
Total expenses                                                0.91% 6       0.94% 6          0.81% 6,7     0.81% 6
- ------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                         44%           48%              32%           45%


1. For the period from September 18, 2001 (inception of offering) to December
31, 2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Less than $0.005 per share.

4. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

7. Voluntary waiver of transfer agent fees less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            14 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Capital Appreciation Fund/VA (the Fund) is a separate series of
Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek capital appreciation by
investing in securities of well-known, established companies. The Trust's
investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.


            15 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                                NET UNREALIZED
                                                                  APPRECIATION
                                                              BASED ON COST OF
                                                                SECURITIES AND
    UNDISTRIBUTED     UNDISTRIBUTED           ACCUMULATED    OTHER INVESTMENTS
    NET INVESTMENT        LONG-TERM                  LOSS   FOR FEDERAL INCOME
    INCOME                     GAIN    CARRYFORWARD 1,2,3         TAX PURPOSES
    --------------------------------------------------------------------------
    $17,418,420                 $--          $277,090,190         $151,853,324

1. As of December 31, 2004, the Fund had $277,090,190 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

                            EXPIRING
                            -------------------------
                            2010         $ 83,313,825
                            2011          193,776,365
                                         ------------
                            Total        $277,090,190
                                         ============

2. During the fiscal year ended December 31, 2004, the Fund utilized $83,521,467
of capital loss carryforward to offset capital gains realized in that fiscal
year.

3. During the fiscal year ended December 31, 2003, the Fund did not utilize any
capital loss carryforward.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

                        REDUCTION TO               REDUCTION TO
                        ACCUMULATED             ACCUMULATED NET
                        NET INVESTMENT            REALIZED LOSS
                        INCOME                   ON INVESTMENTS
                        ---------------------------------------
                        $1,061,848                   $1,061,848


            16 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                           YEAR ENDED               YEAR ENDED
                                    DECEMBER 31, 2004        DECEMBER 31, 2003
    --------------------------------------------------------------------------
    Distributions paid from:
    Ordinary income                        $5,762,501               $5,727,312

 The aggregate cost of securities and other investments and the composition of
 unrealized appreciation and depreciation of securities and other investments
 for federal income tax purposes as of December 31, 2004 are noted below. The
 primary difference between book and tax appreciation or depreciation of
 securities and other investments, if applicable, is attributable to the tax
 deferral of losses or tax realization of financial statement unrealized gain or
 loss.

    Federal tax cost of securities           $1,871,765,466
                                             ===============
    Gross unrealized appreciation            $  290,087,257
    Gross unrealized depreciation              (138,233,933)
                                             ---------------
    Net unrealized appreciation              $  151,853,324
                                             ===============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.


            17 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                                                YEAR ENDED DECEMBER 31, 2004      YEAR ENDED DECEMBER 31, 2003
                                                    SHARES            AMOUNT          SHARES            AMOUNT
- ---------------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                             5,578,990    $  194,357,727      11,371,657    $  330,561,752
Dividends and/or distributions reinvested          155,940         5,404,905         223,231         5,643,286
Redeemed                                        (7,294,682)     (253,727,462)    (12,455,978)     (354,910,280)
                                                ---------------------------------------------------------------
Net decrease                                    (1,559,752)   $  (53,964,830)       (861,090)   $  (18,705,242)
                                                ===============================================================

- ---------------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                             3,992,696    $  138,774,693       2,961,561    $   92,475,323
Dividends and/or distributions reinvested           10,365           357,596           3,339            84,026
Redeemed                                          (700,538)      (24,314,083)       (186,681)       (5,527,434)
                                                ---------------------------------------------------------------
Net increase                                     3,302,523      $114,818,206       2,778,219    $   87,031,915
                                                ===============================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$926,341,824 and $809,068,289, respectively.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$20,206 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.


            18 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA


- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. Following a review of its use of brokerage
commissions for sales that is permitted under its investment advisory agreement,
the Fund's Manager terminated that practice in July 2003. Subsequently, the
Manager paid the Fund $153,724, an amount equivalent to certain of such
commissions incurred in prior years.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.

- --------------------------------------------------------------------------------
6. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER GLOBAL SECURITIES
FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Global Securities Fund/VA, a series of Oppenheimer Variable Account
Funds, including the statement of investments, as of December 31, 2004, and the
related statement of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Global Securities Fund/VA as of December 31, 2004, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005


STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                       SHARES         SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--94.9%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--16.9%
- --------------------------------------------------------------------------------
AUTOMOBILES--1.3%
Porsche AG, Preferred                                  22,868       $ 14,506,586
- --------------------------------------------------------------------------------
Toyota Motor Corp.                                    667,900         27,277,577
                                                                    ------------
                                                                      41,784,163

- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--1.3%
International Game Technology                         568,100         19,531,278
                                                                    ------------
Starbucks Corp. 1                                     334,400         20,853,184
                                                                    ------------
                                                                      40,384,462

- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES--0.4%
Sharp Corp.                                           806,000         13,159,344
- --------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL--0.4%
Amazon.com, Inc. 1                                    279,100         12,361,339
- --------------------------------------------------------------------------------
MEDIA--8.6%
Grupo Televisa SA, Sponsored
GDR                                                   405,299         24,520,590
- --------------------------------------------------------------------------------
JC Decaux SA 1                                        492,604         14,382,403
- --------------------------------------------------------------------------------
Pearson plc                                         1,950,238         23,532,707
- --------------------------------------------------------------------------------
Reed Elsevier plc                                   1,423,866         13,135,346
- --------------------------------------------------------------------------------
Singapore Press Holdings Ltd.                       5,887,640         16,590,997
- --------------------------------------------------------------------------------
Sirius Satellite Radio, Inc. 1                     13,387,014        102,410,657
- --------------------------------------------------------------------------------
Societe Television Francaise  1                       351,960         11,457,716
- --------------------------------------------------------------------------------
Television Broadcasts Ltd.                          4,743,832         22,032,541
- --------------------------------------------------------------------------------
Wolters Kluwer NV                                     738,450         14,825,209
- --------------------------------------------------------------------------------
WPP Group plc                                       1,068,520         11,754,828
- --------------------------------------------------------------------------------
Zee Telefilms Ltd.                                  4,876,300         19,193,350
                                                                    ------------
                                                                     273,836,344

- --------------------------------------------------------------------------------
SPECIALTY RETAIL--4.3%
Circuit City Stores, Inc./
Circuit City Group                                  1,281,249         20,038,734
- --------------------------------------------------------------------------------
Gap, Inc. (The)                                       522,500         11,035,200
- --------------------------------------------------------------------------------
Hennes & Mauritz AB, B Shares                       1,955,900         68,135,981
- --------------------------------------------------------------------------------
New Dixons Group plc                                8,998,110         26,258,740
- --------------------------------------------------------------------------------
RadioShack Corp.                                      320,600         10,541,328
                                                                    ------------
                                                                     136,009,983

- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--0.6%
Coach, Inc. 1                                         172,400          9,723,360
- --------------------------------------------------------------------------------
LVMH Moet Hennessey
Louis Vuitton                                         108,870          8,338,758
                                                                    ------------
                                                                      18,062,118
- --------------------------------------------------------------------------------
CONSUMER STAPLES--7.4%
- --------------------------------------------------------------------------------
BEVERAGES--1.5%
Companhia de Bebidas das
Americas, ADR                                         563,415         15,961,547


                                                                           VALUE
                                                       SHARES         SEE NOTE 1
- --------------------------------------------------------------------------------
BEVERAGES Continued
Diageo plc                                            406,400       $  5,797,243
- --------------------------------------------------------------------------------
Fomento Economico Mexicano
SA de CV, UBD                                       2,863,600         15,036,019
- --------------------------------------------------------------------------------
Grupo Modelo SA de CV,
Series C                                            3,951,400         10,868,388
                                                                    ------------
                                                                      47,663,197

- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--1.0%
Boots Group plc                                     1,010,620         12,718,608

- --------------------------------------------------------------------------------
Carrefour SA                                          180,410          8,592,587

- --------------------------------------------------------------------------------
Seven-Eleven Japan Co. Ltd.                           321,000         10,118,376
                                                                    ------------
                                                                      31,429,571

- --------------------------------------------------------------------------------
FOOD PRODUCTS--1.0%
Cadbury Schweppes plc                               3,289,501         30,630,265
- --------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--2.5%
Hindustan Lever Ltd.                                5,411,000         17,862,399
- --------------------------------------------------------------------------------
Reckitt Benckiser plc                               2,002,937         60,527,259
                                                                    ------------
                                                                      78,389,658

- --------------------------------------------------------------------------------
PERSONAL PRODUCTS--1.0%
Gillette Co.                                          513,100         22,976,618
- --------------------------------------------------------------------------------
Shiseido Co. Ltd.                                     734,000         10,629,999
                                                                    ------------
                                                                      33,606,617

- --------------------------------------------------------------------------------
TOBACCO--0.4%
Altria Group, Inc.                                    133,000          8,126,300
- --------------------------------------------------------------------------------
ITC Ltd.                                              115,900          3,492,197
                                                                    ------------
                                                                      11,618,497

- --------------------------------------------------------------------------------
ENERGY--7.6%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--3.2%
GlobalSantaFe Corp.                                   895,100         29,636,761
- --------------------------------------------------------------------------------
Technip SA                                            174,520         32,261,411
- --------------------------------------------------------------------------------
Transocean, Inc. 1                                    901,700         38,223,063
                                                                    ------------
                                                                     100,121,235

- --------------------------------------------------------------------------------
OIL & GAS--4.4%
BP plc, ADR                                           407,969         23,825,390
- --------------------------------------------------------------------------------
Burlington Resources, Inc.                            324,400         14,111,400
- --------------------------------------------------------------------------------
ChevronTexaco Corp.                                   466,944         24,519,229
- --------------------------------------------------------------------------------
Encana Corp.                                          356,817         20,369,973
- --------------------------------------------------------------------------------
ENI SpA                                               532,000         13,319,886
- --------------------------------------------------------------------------------
Husky Energy, Inc.                                  1,009,715         28,863,447
- --------------------------------------------------------------------------------
Oil & Natural Gas Corp. Ltd.                          190,670          3,594,746
- --------------------------------------------------------------------------------
Total SA, B Shares                                     57,630         12,630,122
                                                                    ------------
                                                                     141,234,193


                   8 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


                                                                           VALUE
                                                      SHARES          SEE NOTE 1
- --------------------------------------------------------------------------------
FINANCIALS--17.7%
- --------------------------------------------------------------------------------
CAPITAL MARKETS--0.3%
Northern Trust Corp.                                 200,100        $  9,720,858
- --------------------------------------------------------------------------------
COMMERCIAL BANKS--8.2%
ABN Amro Holding NV                                1,125,400          29,813,845
- --------------------------------------------------------------------------------
Anglo Irish Bank Corp.                               742,166          18,057,321
- --------------------------------------------------------------------------------
Australia & New Zealand
Banking Group Ltd.                                   841,550          13,583,038
- --------------------------------------------------------------------------------
Commerce Bancorp, Inc.                                91,900           5,918,360
- --------------------------------------------------------------------------------
HSBC Holdings plc 3                                1,790,887          30,644,174
- --------------------------------------------------------------------------------
HSBC Holdings plc 3                                  205,000           3,459,567
- --------------------------------------------------------------------------------
ICICI Bank Ltd., Sponsored ADR                     1,198,250          24,144,738
- --------------------------------------------------------------------------------
Resona Holdings, Inc. 1                            6,040,000          12,219,640
- --------------------------------------------------------------------------------
Royal Bank of Scotland
Group plc (The)                                    1,823,287          61,329,317
- --------------------------------------------------------------------------------
Societe Generale, Cl. A                              280,020          28,336,943
- --------------------------------------------------------------------------------
Wachovia Corp.                                       599,029          31,508,925
                                                                    ------------
                                                                     259,015,868

- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--5.1%
3i Group plc                                         903,406          11,551,442
- --------------------------------------------------------------------------------
American Express Co.                                 415,900          23,444,283
- --------------------------------------------------------------------------------
Citigroup, Inc.                                      201,566           9,711,450
- --------------------------------------------------------------------------------
Credit Saison Co. Ltd.                               479,600          17,511,466
- --------------------------------------------------------------------------------
Investor AB, B Shares                                611,109           7,770,595
- --------------------------------------------------------------------------------
JPMorgan Chase & Co.                               1,242,563          48,472,383
- --------------------------------------------------------------------------------
MBNA Corp.                                           963,250          27,154,018
- --------------------------------------------------------------------------------
MLP AG                                               343,647           6,801,006
- --------------------------------------------------------------------------------
Schwab (Charles) Corp.                               888,300          10,624,068
                                                                    ------------
                                                                     163,040,711

- --------------------------------------------------------------------------------
INSURANCE--4.1%
ACE Ltd.                                             647,871          27,696,485
- --------------------------------------------------------------------------------
Aegon NV                                           1,642,107          22,387,295
- --------------------------------------------------------------------------------
Allianz AG                                           220,600          29,130,474
- --------------------------------------------------------------------------------
Berkshire Hathaway, Inc., Cl. B 1                      7,250          21,286,000
- --------------------------------------------------------------------------------
Everest Re Group Ltd.                                127,300          11,400,988
- --------------------------------------------------------------------------------
Manulife Financial Corp.                             373,713          17,279,723
                                                                    ------------
                                                                     129,180,965

- --------------------------------------------------------------------------------
HEALTH CARE--12.8%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--3.6%
Affymetrix, Inc. 1                                   413,600          15,117,080
- --------------------------------------------------------------------------------
Amgen, Inc. 1                                        456,900          29,310,135
- --------------------------------------------------------------------------------
Applera Corp./Applied
Biosystems Group                                     498,500          10,423,635
- --------------------------------------------------------------------------------
Genentech, Inc. 1                                    262,700          14,301,388
- --------------------------------------------------------------------------------
Genzyme Corp.
(General Division) 1                                 246,600          14,320,062


                                                                           VALUE
                                                      SHARES          SEE NOTE 1
- --------------------------------------------------------------------------------
BIOTECHNOLOGY Continued
Gilead Sciences, Inc. 1                              698,360        $ 24,435,616
- --------------------------------------------------------------------------------
Human Genome Sciences, Inc. 1                        302,400           3,634,848
- --------------------------------------------------------------------------------
Millennium Pharmaceuticals, Inc. 1                   291,700           3,535,404
                                                                    ------------
                                                                     115,078,168

- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--1.5%
Essilor International SA                             178,810          14,011,685
- --------------------------------------------------------------------------------
Nektar Therapeutics 1,2                              314,361           5,090,133
- --------------------------------------------------------------------------------
Smith & Nephew plc                                 2,623,390          26,845,349
                                                                    ------------
                                                                      45,947,167

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--1.6%
Express Scripts, Inc. 1                              162,800          12,444,432
- --------------------------------------------------------------------------------
IMS Health, Inc.                                     529,900          12,298,979
- --------------------------------------------------------------------------------
Quest Diagnostics, Inc.                              272,100          25,999,155
                                                                    ------------
                                                                      50,742,566

- -------------------------------------------------------------------------------
PHARMACEUTICALS--6.1%
AstraZeneca plc                                      267,000           9,683,274
- --------------------------------------------------------------------------------
Chugai Pharmaceutical Co. Ltd.                       754,800          12,478,103
- --------------------------------------------------------------------------------
Eli Lilly & Co.                                      160,100           9,085,675
- --------------------------------------------------------------------------------
Novartis AG                                          404,244          20,370,399
- --------------------------------------------------------------------------------
Pfizer, Inc.                                         657,719          17,686,064
- --------------------------------------------------------------------------------
Roche Holdings AG                                    310,265          35,716,901
- --------------------------------------------------------------------------------
Sanofi-Synthelabo SA                                 691,494          55,266,885
- --------------------------------------------------------------------------------
Schering-Plough Corp.                                785,200          16,394,976
- --------------------------------------------------------------------------------
Shionogi & Co. Ltd.                                1,266,000          17,506,802
                                                                    ------------
                                                                     194,189,079

- ------------------------------------------------------------------------------
INDUSTRIALS--4.5%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--3.0%
Boeing Co.                                           279,300          14,459,361
- --------------------------------------------------------------------------------
Empresa Brasileira de
Aeronautica SA, ADR                                  920,934          30,796,033
- --------------------------------------------------------------------------------
Lockheed Martin Corp.                                237,200          13,176,460
- --------------------------------------------------------------------------------
Northrop Grumman Corp.                               251,200          13,655,232
- --------------------------------------------------------------------------------
Raytheon Co.                                         577,600          22,428,208
                                                                    ------------
                                                                      94,515,294

- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--0.1%
JGC Corp.                                            490,000           4,480,628
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.9%
Hutchison Whampoa Ltd.                             1,415,000          13,243,950
- --------------------------------------------------------------------------------
Siemens AG                                           189,018          16,021,697
                                                                    ------------
                                                                      29,265,647

- --------------------------------------------------------------------------------
MACHINERY--0.4%
Hyundai Heavy Industries Co. Ltd.                    342,470          11,396,920


                   9 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                      SHARES          SEE NOTE 1
- --------------------------------------------------------------------------------
MARINE--0.1%
Peninsular & Oriental Steam
Navigation Co.                                          586,910   $    3,352,258
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--19.7%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--5.8%
Alcatel SA 1                                          1,046,470       16,376,510
- --------------------------------------------------------------------------------
Cisco Systems, Inc. 1                                   924,600       17,844,780
- --------------------------------------------------------------------------------
Corning, Inc. 1                                       1,238,400       14,575,968
- --------------------------------------------------------------------------------
JDS Uniphase Corp. 1                                  4,530,200       14,360,734
- --------------------------------------------------------------------------------
Juniper Networks, Inc. 1                                430,700       11,710,733
- --------------------------------------------------------------------------------
QUALCOMM, Inc.                                          690,500       29,277,200
- --------------------------------------------------------------------------------
Scientific-Atlanta, Inc.                                317,200       10,470,772
- --------------------------------------------------------------------------------
Telefonaktiebolaget LM
Ericsson, B Shares 1                                 21,949,100       70,021,507
                                                                  --------------
                                                                     184,638,204

- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--1.5%
International Business
Machines Corp.                                          304,117       29,979,854
- --------------------------------------------------------------------------------
Sun Microsystems, Inc. 1                              3,464,000       18,636,320
                                                                  --------------
                                                                      48,616,174

- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--1.8%
Hoya Corp.                                               70,400        7,948,941
- --------------------------------------------------------------------------------
Keyence Corp.                                            50,200       11,248,092
- --------------------------------------------------------------------------------
Murata Manufacturing Co. Ltd.                           222,100       12,463,010
- --------------------------------------------------------------------------------
Nidec Corp.                                              48,300        5,887,255
- --------------------------------------------------------------------------------
Omron Corp.                                             134,000        3,197,326
- --------------------------------------------------------------------------------
Tandberg ASA                                          1,405,950       17,468,029
                                                                  --------------
                                                                      58,212,653

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.3%
Yahoo Japan Corp. 1                                       1,762        8,460,076
- --------------------------------------------------------------------------------
IT SERVICES--1.6%
Amadeus Global Travel
Distribution SA                                       1,419,001       14,600,839
- --------------------------------------------------------------------------------
Infosys Technologies Ltd.                               738,140       35,472,152
                                                                  --------------
                                                                      50,072,991

- --------------------------------------------------------------------------------
OFFICE ELECTRONICS--0.4%
Canon, Inc.                                             208,000       11,264,629
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--4.4%
Advanced Micro Devices, Inc. 1                        1,920,800       42,296,016
- --------------------------------------------------------------------------------
Altera Corp. 1                                          254,000        5,257,800
- --------------------------------------------------------------------------------
National Semiconductor Corp. 1                        1,125,800       20,208,110
- --------------------------------------------------------------------------------
Nikon Corp.                                           1,192,415       14,787,233
- --------------------------------------------------------------------------------
Samsung Electronics Co.                                  62,740       27,303,294
- --------------------------------------------------------------------------------
Silicon Laboratories, Inc. 1                            158,800        5,607,228


                                                                           VALUE
                                                      SHARES          SEE NOTE 1
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT Continued
Taiwan Semiconductor
Manufacturing Co. Ltd. 2                             15,313,223   $   24,402,580
                                                                  --------------
                                                                     139,862,261

- --------------------------------------------------------------------------------
SOFTWARE--3.9%
BEA Systems, Inc. 1                                   1,408,805       12,482,012
- --------------------------------------------------------------------------------
Cadence Design Systems, Inc. 1                          888,770       12,273,914
- --------------------------------------------------------------------------------
Electronic Arts, Inc. 1                                  81,442        5,023,343
- --------------------------------------------------------------------------------
Novell, Inc. 1                                        1,827,226       12,333,776
- --------------------------------------------------------------------------------
Red Hat, Inc. 1                                         402,100        5,368,035
- --------------------------------------------------------------------------------
SAP AG                                                  170,738       30,448,323
- --------------------------------------------------------------------------------
Symantec Corp. 1                                        633,000       16,306,080
- --------------------------------------------------------------------------------
Trend Micro, Inc.                                       341,000       18,519,702
- --------------------------------------------------------------------------------
Veritas Software Corp. 1                                319,100        9,110,305
                                                                  --------------
                                                                     121,865,490

- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--7.3%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--1.7%
France Telecom SA                                       903,108       29,903,100
- --------------------------------------------------------------------------------
Tele Norte Leste Participacoes SA                            78            1,368
- --------------------------------------------------------------------------------
Tele Norte Leste Participacoes
SA, Preference                                        1,387,785       23,199,418
                                                                  --------------
                                                                      53,103,886

- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--5.6%
Hutchison Telecommunications
International Ltd. 1                                     18,720           16,859
- --------------------------------------------------------------------------------
KDDI Corp.                                                8,604       46,349,253
- --------------------------------------------------------------------------------
SK Telecom Co. Ltd., ADR                                874,960       19,467,860
- --------------------------------------------------------------------------------
Vodafone Group plc                                   41,162,730      111,627,608
                                                                  --------------
                                                                     177,461,580

- --------------------------------------------------------------------------------
UTILITIES--1.0%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--0.4%
Energias de Portugal SA                               2,729,106        8,272,266
- --------------------------------------------------------------------------------
Fortum Oyj                                              256,200        4,743,026
                                                                  --------------
                                                                      13,015,292

- --------------------------------------------------------------------------------
GAS UTILITIES--0.6%
Gail India Ltd.                                         324,270        1,720,936
- --------------------------------------------------------------------------------
Hong Kong & China Gas Co. Ltd.                        8,035,000       16,591,628
                                                                  --------------
                                                                      18,312,564
                                                                  --------------

Total Common Stocks
(Cost $2,080,377,086)                                              3,005,102,915


                   10 | OPPENHEIMER GLOBAL SECURITIES FUND/VA





                                                         PRINCIPAL             VALUE
                                                            AMOUNT        SEE NOTE 1
- ------------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--4.8%
- ------------------------------------------------------------------------------------

Undivided interest of 10.58% in joint repurchase
agreement (Principal Amount/Value $1,443,703,000,
with a maturity value of $1,443,962,867) with UBS
Warburg LLC, 2.16%, dated 12/31/04, to be
repurchased at $152,800,499 on 1/3/05,
collateralized by Federal National Mortgage
Assn., 5%--6%, 4/1/34--10/1/34, with
a value of $1,474,609,071
(Cost $152,773,000)                                 $  152,773,000    $  152,773,000

- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $2,233,150,086)                                         99.7%    3,157,875,915
- ------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES                                0.3         9,821,293
                                                    --------------------------------
NET ASSETS                                                   100.0%   $3,167,697,208
                                                    ================================


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of December 31, 2004 was $29,492,713, which represents
0.93% of the Fund's net assets, of which $5,090,133 is considered restricted.
See Note 6 of Notes to Financial Statements.

3. The Fund holds securities which have been issued by the same entity and that
trade on separate exchanges.

- --------------------------------------------------------------------------------
GEOGRAPHIC HOLDINGS (Unaudited)
- --------------------------------------------------------------------------------

DISTRIBUTION OF INVESTMENTS REPRESENTING GEOGRAPHIC HOLDINGS, AS A PERCENTAGE OF
TOTAL INVESTMENTS AT VALUE, IS AS FOLLOWS:

GEOGRAPHIC HOLDINGS                                         VALUE       PERCENT
- --------------------------------------------------------------------------------
United States                                      $1,255,621,619          39.8%
United Kingdom                                        466,673,375          14.8
Japan                                                 265,507,452           8.4
France                                                231,558,120           7.3
Sweden                                                145,928,083           4.6
India                                                 105,480,518           3.3
Germany                                                96,908,086           3.1
Brazil                                                 69,958,366           2.2
The Netherlands                                        67,026,349           2.1
Canada                                                 66,513,143           2.1
Korea, Republic of South                               58,168,074           1.8
Switzerland                                            56,087,300           1.8
Hong Kong                                              51,884,978           1.6
Mexico                                                 50,424,997           1.6
Bermuda                                                39,097,473           1.2
Taiwan                                                 24,402,580           0.8
Ireland                                                18,057,321           0.6
Norway                                                 17,468,029           0.6
Singapore                                              16,590,997           0.5
Spain                                                  14,600,839           0.5
Australia                                              13,583,038           0.4
Italy                                                  13,319,886           0.4
Portugal                                                8,272,266           0.3
Finland                                                 4,743,026           0.2
                                                   -----------------------------
Total                                              $3,157,875,915         100.0%
                                                   =============================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   11 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- ---------------------------------------------------------------------------------------------------------
ASSETS
- ---------------------------------------------------------------------------------------------------------

Investments, at value (cost $2,233,150,086)--see accompanying statement of investments   $ 3,157,875,915
- ---------------------------------------------------------------------------------------------------------
Cash                                                                                              70,058
- ---------------------------------------------------------------------------------------------------------
Cash--foreign currencies (cost $2,287,816)                                                     2,318,287
- ---------------------------------------------------------------------------------------------------------
Receivables and other assets:
Interest and dividends                                                                         5,682,367
Shares of beneficial interest sold                                                             3,273,141
Investments sold                                                                                 587,702
Other                                                                                             32,367
                                                                                        ----------------
Total assets                                                                               3,169,839,837

- ---------------------------------------------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                                         1,560,266
Distribution and service plan fees                                                               210,215
Custodian fees                                                                                   124,870
Foreign capital gains tax                                                                        106,918
Trustees' compensation                                                                            50,045
Shareholder communications                                                                        36,185
Transfer and shareholder servicing agent fees                                                      3,455
Other                                                                                             50,675
                                                                                         ---------------
Total liabilities                                                                              2,142,629

- ---------------------------------------------------------------------------------------------------------
NET ASSETS                                                                               $ 3,167,697,208
                                                                                         ================

- ---------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
Par value of shares of beneficial interest                                               $       107,376
- ---------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                 2,361,502,185
- ---------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                             13,762,145
- ---------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions              (132,454,462)
- ---------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies                                                            924,779,964
                                                                                         ----------------
NET ASSETS                                                                               $ 3,167,697,208
                                                                                         ================

- ---------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on
net assets of $2,518,866,995 and 85,355,332 shares of beneficial interest outstanding)            $29.51
- ---------------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share (based on
net assets of $346,402,810 and 11,809,440 shares of beneficial interest outstanding)              $29.33
- ---------------------------------------------------------------------------------------------------------
Class 3 Shares:
Net asset value, redemption price per share and offering price per share (based on
net assets of $265,043,754 and 8,937,735 shares of beneficial interest outstanding)               $29.65
- ---------------------------------------------------------------------------------------------------------
Class 4 Shares:
Net asset value, redemption price per share and offering price per share (based on
net assets of $37,383,649 and 1,273,510 shares of beneficial interest outstanding)                $29.35
- ---------------------------------------------------------------------------------------------------------


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   12 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $4,284,789)        $  46,732,962
- --------------------------------------------------------------------------------
Interest                                                              1,850,524
                                                                  -------------
Total investment income                                              48,583,486

- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees                                                      18,297,753
- --------------------------------------------------------------------------------
Distribution and service plan fees:
Service shares                                                          617,506
Class 4 shares                                                           32,566
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                       10,282
Service shares                                                           10,036
Class 3 shares                                                           10,026
Class 4 shares                                                            5,016
- --------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                       89,139
Service shares                                                            8,396
Class 3 shares                                                            6,834
Class 4 shares                                                              382
- --------------------------------------------------------------------------------
Custodian fees and expenses                                             571,468
- --------------------------------------------------------------------------------
Trustees' compensation                                                   70,320
- --------------------------------------------------------------------------------
Other                                                                   114,362
                                                                  --------------
Total expenses                                                       19,844,086
Less reduction to custodian expenses                                    (11,719)
                                                                  --------------
Net expenses                                                         19,832,367

- --------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                28,751,119

- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN
- --------------------------------------------------------------------------------
Net realized gain on:
Investments                                                         137,644,145
Foreign currency transactions                                        41,371,491
Net increase from payment by affiliate                                   70,760
                                                                  -------------
Net realized gain                                                   179,086,396
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments (net of foreign capital gains tax of $106,918)          280,226,888
Translation of assets and liabilities denominated in foreign
  currencies                                                         50,820,961
                                                                  --------------
Net change in unrealized appreciation                               331,047,849
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS              $ 538,885,364
                                                                  ==============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   13 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                      2004               2003
- -----------------------------------------------------------------------------------------------------

OPERATIONS
- -----------------------------------------------------------------------------------------------------
Net investment income                                             $    28,751,119    $    18,395,967
- -----------------------------------------------------------------------------------------------------
Net realized gain (loss)                                              179,086,396        (67,064,035)
- -----------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                  331,047,849        777,963,383
                                                                  -----------------------------------
Net increase in net assets resulting from operations                  538,885,364        729,295,315

- -----------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- -----------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                    (30,456,227)       (13,324,089)
Service shares                                                         (2,439,240)          (449,100)
Class 3 shares                                                         (2,221,201)                --
Class 4 shares                                                                 --                 --

- -----------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial
interest transactions:
Non-Service shares                                                   (177,302,804)        79,623,681
Service shares                                                        130,991,549         77,667,391
Class 3 shares                                                         80,796,251        121,430,754
Class 4 shares                                                         32,377,319                 --

- -----------------------------------------------------------------------------------------------------
NET ASSETS
- -----------------------------------------------------------------------------------------------------
Total increase                                                        570,631,011        994,243,952
- -----------------------------------------------------------------------------------------------------
Beginning of period                                                 2,597,066,197      1,602,822,245
                                                                  -----------------------------------
End of period (including accumulated net investment income of
$13,762,145 and $14,682,479, respectively)                        $ 3,167,697,208    $ 2,597,066,197
                                                                  ===================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   14 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                  2004           2003           2002           2001          2000
- -------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- -------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $    25.08     $    17.70     $    22.84     $    30.33     $    33.41
- -------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                         .26 1          .19            .16            .17            .27
Net realized and unrealized gain (loss)                      4.49           7.34          (5.19)         (3.85)          1.82
                                                       ------------------------------------------------------------------------
Total from investment operations                             4.75           7.53          (5.03)         (3.68)          2.09
- -------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                         (.32)          (.15)          (.11)          (.19)          (.09)
Distributions from net realized gain                           --             --             --          (3.62)         (5.08)
                                                       ------------------------------------------------------------------------
Total dividends and/or distributions to shareholders         (.32)          (.15)          (.11)         (3.81)         (5.17)
- -------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $    29.51     $    25.08     $    17.70     $    22.84     $    30.33
                                                       ========================================================================

- -------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                          19.16%         43.02%        (22.13)%       (12.04)%         5.09%
- -------------------------------------------------------------------------------------------------------------------------------

- -------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $2,518,867     $2,280,752     $1,549,993     $1,905,890     $2,136,420
- -------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $2,451,188     $1,751,226     $1,776,289     $1,918,335     $2,116,100
- -------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                        1.01%          0.99%          0.80%          0.70%          0.83%
Total expenses                                               0.66% 4        0.67% 4        0.67% 4        0.70% 4        0.68% 4
- -------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                        30%            34%            34%            39%            50%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   15 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------



SERVICE SHARES  YEAR ENDED DECEMBER 31,                    2004           2003           2002           2001       2000 1
- --------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                   $  24.96       $  17.61       $  22.78       $  30.30       $32.65
- --------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                       .20 2          .12            .12            .21         .03
Net realized and unrealized gain (loss)                    4.46           7.36          (5.19)         (3.92)      (2.38)
                                                       -------------------------------------------------------------------
Total from investment operations                           4.66           7.48          (5.07)         (3.71)      (2.35)
- --------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                       (.29)          (.13)          (.10)          (.19)         --
Distributions from net realized gain                         --             --             --          (3.62)         --
                                                       -------------------------------------------------------------------
Total dividends and/or distributions to shareholders       (.29)          (.13)          (.10)         (3.81)         --
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $  29.33       $  24.96       $  17.61       $  22.78       $30.30
                                                       ===================================================================

- --------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                        18.88%         42.86%        (22.37)%       (12.17)%     (7.20)%
- --------------------------------------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $346,403       $168,739       $ 52,830       $ 20,467       $ 983
- --------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $247,490       $ 91,800       $ 34,847       $  8,502       $ 325
- --------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                      0.77%          0.68%          0.51%          0.44%       0.60%
Total expenses                                             0.91% 5        0.93% 5        0.90% 5        0.85% 5     0.83% 5
- --------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                      30%            34%            34%            39%         50%


1. For the period from July 13, 2000 (inception of offering) to December 31,
2000.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   16 | OPPENHEIMER GLOBAL SECURITIES FUND/VA




CLASS 3 SHARES   YEAR ENDED DECEMBER 31,                    2004             2003 1
- --------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------
Net asset value, beginning of period                     $ 25.19            $ 17.55
- --------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                        .26 2              .07
Net realized and unrealized gain                            4.52               7.57
                                                         ----------------------------
Total from investment operations                            4.78               7.64
- --------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                        (.32)                --
Distributions from net realized gain                          --                 --
                                                         -----------------------------
Total dividends and/or distributions to shareholders        (.32)                --
- --------------------------------------------------------------------------------------
Net asset value, end of period                           $ 29.65            $ 25.19
                                                         =============================

- --------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                         19.19%             43.53%
- --------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                 $265,044           $147,576
- --------------------------------------------------------------------------------------
Average net assets (in thousands)                        $199,388           $80,579
- --------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                       1.00%              0.73%
Total expenses                                              0.66% 5            0.68% 5
- --------------------------------------------------------------------------------------
Portfolio turnover rate                                       30%                34%


1. For the period from May 1, 2003 (inception of offering) to December 31, 2003.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   17 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

CLASS 4 SHARES   PERIOD ENDED DECEMBER 31,                          2004 1
- -----------------------------------------------------------------------------
PER SHARE OPERATING DATA
Net asset value, beginning of period                               $ 25.21
- -----------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                                  .09 2
Net realized and unrealized gain                                      4.05
                                                                   ----------

Total from investment operations                                      4.14
- -----------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                    --
Distributions from net realized gain                                    --
                                                                   ----------
Total dividends and/or distributions to shareholders                    --
- -----------------------------------------------------------------------------
Net asset value, end of period                                     $ 29.35

- -----------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                   16.42%
- -----------------------------------------------------------------------------

- -----------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------
Net assets, end of period (in thousands)                           $37,384
- -----------------------------------------------------------------------------
Average net assets (in thousands)                                  $19,774
- -----------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                                 0.53%
Total expenses                                                        0.94% 5
- -----------------------------------------------------------------------------
Portfolio turnover rate                                                 30%

1. For the period from May 3, 2004 (inception of offering) to December 31, 2004.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                   18 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Global Securities Fund/VA (the Fund) is a separate series of
Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek long-term capital
appreciation by investing a substantial portion of its assets in securities of
foreign issuers, "growth-type" companies, cyclical industries and special
situations that are considered to have appreciation possibilities. The Trust's
investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers Non-Service, Service, Class 3 and Class 4 shares. All
classes are sold at their offering price, which is the net asset value per
share, to separate investment accounts of participating insurance companies as
an underlying investment for variable life insurance policies, variable annuity
contracts or other investment products. All classes of shares have identical
rights and voting privileges with respect to the Fund in general and exclusive
voting rights on matters that affect that class alone. Earnings, net assets and
net asset value per share may differ due to each class having its own expenses,
such as transfer and shareholder servicing agent fees and shareholder
communications, directly attributable to that class. The classes of shares
designated as Service shares and Class 4 shares are subject to a distribution
and service plan. The Fund assesses a 1% fee on the proceeds of Class 3 and
Class 4 shares that are redeemed (either by selling or exchanging to another
Oppenheimer fund or other investment option offered through your variable life
insurance or variable annuity contract) within 60 days of their purchase. The
fee, which is retained by the Fund, is accounted for as an addition to paid-in
capital.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net


                   19 | OPPENHEIMER GLOBAL SECURITIES FUND/VA




NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

unrealized foreign exchange gains and losses arise from changes in the values of
assets and liabilities, including investments in securities at fiscal period
end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                               NET UNREALIZED
                                                                 APPRECIATION
                                                             BASED ON COST OF
                                                               SECURITIES AND
    UNDISTRIBUTED   UNDISTRIBUTED           ACCUMULATED     OTHER INVESTMENTS
    NET INVESTMENT      LONG-TERM                  LOSS    FOR FEDERAL INCOME
    INCOME                   GAIN  CARRYFORWARD 1,2,3,4          TAX PURPOSES
   --------------------------------------------------------------------------
   $32,197,430                $--         $ 130,533,912          $904,456,195

1. As of December 31, 2004, the Fund had $130,358,556 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

                        EXPIRING
                        --------------------------
                        2010         $ 24,452,753
                        2011          105,905,803
                                     ------------
                        Total        $130,358,556
                                     ============

2. The Fund had $94,954 of post-October foreign currency losses which were
deferred.

3. The Fund had $80,402 of post-October passive foreign investment company
losses which were deferred.

4. During the fiscal year ended December 31, 2004, the Fund utilized
$170,421,832 of capital loss carryforward to offset capital gains realized in
that fiscal year.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.


                   20 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


      INCREASE TO            INCREASE TO
      ACCUMULATED        ACCUMULATED NET
      NET INVESTMENT       REALIZED LOSS
      INCOME              ON INVESTMENTS
      ----------------------------------
      $5,445,215              $5,445,215

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                         YEAR ENDED           YEAR ENDED
                                  DECEMBER 31, 2004    DECEMBER 31, 2003
      ------------------------------------------------------------------
      Distributions paid from:
      Ordinary income                   $35,116,668          $13,773,189

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

      Federal tax cost of securities                    $ 2,253,473,856
      Federal tax cost of other investments                   2,287,816
                                                        ---------------
      Total federal tax cost                            $ 2,255,761,672
                                                        ===============
      Gross unrealized appreciation                     $   940,496,257
      Gross unrealized depreciation                         (36,040,062)
                                                        ---------------
      Net unrealized appreciation                       $   904,456,195
                                                        ===============

Certain foreign countries impose a tax on capital gains which is accrued by the
Fund based on unrealized appreciation, if any, on affected securities. The tax
is paid when the gain is realized.

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.


                   21 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:




                                              YEAR ENDED DECEMBER 31, 2004 1        YEAR ENDED DECEMBER 31, 2003 2
                                                   SHARES             AMOUNT           SHARES               AMOUNT
- -------------------------------------------------------------------------------------------------------------------
NON-SERVICE SHARES

Sold                                           23,590,376      $ 610,109,742       56,815,585      $ 1,050,428,269
Dividends and/or distributions reinvested       1,203,327         30,456,227          828,612           13,324,089
Redeemed                                      (30,383,126)      (817,868,773)     (54,266,655)        (984,128,677)
                                             ----------------------------------------------------------------------
Net increase (decrease)                        (5,589,423)     $(177,302,804)       3,377,542      $    79,623,681
                                             ======================================================================

- -------------------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                            6,516,321      $ 168,136,666        9,204,619      $   180,268,510
Dividends and/or distributions reinvested          96,757          2,439,240           28,051              449,100
Redeemed                                       (1,562,747)       (39,584,357)      (5,472,867)        (103,050,219)
                                             ----------------------------------------------------------------------
Net increase                                    5,050,331      $ 130,991,549        3,759,803      $    77,667,391
                                             ======================================================================

- -------------------------------------------------------------------------------------------------------------------
CLASS 3 SHARES
Sold                                            3,286,454      $  85,761,974        6,450,195      $   132,821,158
Dividends and/or distributions reinvested          87,346          2,221,201               --                   --
Redeemed                                         (293,439)        (7,186,924) 3      (592,821)         (11,390,404)
                                             ----------------------------------------------------------------------
Net increase                                    3,080,361      $  80,796,251        5,857,374      $   121,430,754
                                             ======================================================================

- -------------------------------------------------------------------------------------------------------------------
CLASS 4 SHARES
Sold                                            1,345,840      $  34,232,416               --      $            --
Dividends and/or distributions reinvested              --                 --               --                   --
Redeemed                                          (72,330)        (1,855,097) 3            --                   --
                                             ----------------------------------------------------------------------
Net increase                                    1,273,510      $  32,377,319               --      $            --
                                             ======================================================================


1. For the year ended December 31, 2004, for Non-Service, Service and Class 3
shares and for the period from May 3, 2004 (inception of offering) to December
31, 2004, for Class 4 shares.

2. For the year ended December 31, 2003, for Non-Service and Service shares and
for the period from May 1, 2003 (inception of offering) to December 31, 2003,
for Class 3 shares.

3. Net of redemption fees of $34,168 and $5,752 for Class 3 and Class 4 shares,
respectively.

- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$854,707,319 and $843,096,565, respectively.


                   22 | OPPENHEIMER GLOBAL SECURITIES FUND/VA



- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$34,406 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE AND CLASS 4 SHARES. The Fund has
adopted a Distribution and Service Plan for Service share class and Class 4
shares to pay OppenheimerFunds Distributor, Inc. (the Distributor), for
distribution related services and personal service and account maintenance for
the Fund's Service class and Class 4 shares. Under the Plan, payments are made
quarterly at an annual rate of up to 0.25% of the average annual net assets of
Service share class and Class 4 shares of the Fund. The Distributor currently
uses all of those fees to compensate sponsor(s) of the insurance product that
offers Fund shares, for providing personal service and maintenance of accounts
of their variable contract owners that hold Service class and Class 4 shares.
The impact of the service plan is to increase operating expenses of the Service
class and Class 4 shares, which results in lower performance compared to the
Fund's shares that are not subject to a service fee. Fees incurred by the Fund
under the Plan are detailed in the Statement of Operations.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. Following a review of its use of brokerage
commissions for sales that is permitted under its investment advisory agreement,
the Fund's Manager terminated that practice in July 2003. Subsequently, the
Manager paid the Fund $70,760, an amount equivalent to certain of such
commissions incurred in prior years.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.


                   23 | OPPENHEIMER GLOBAL SECURITIES FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
6. ILLIQUID OR RESTRICTED SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 15% of
its net assets (determined at the time of purchase and reviewed periodically) in
illiquid or restricted securities. Certain restricted securities, eligible for
resale to qualified institutional investors, are not subject to that limitation.
Information concerning restricted securities is as follows:

                     ACQUISITION                 VALUATION AS OF     UNREALIZED
SECURITY                    DATE         COST  DECEMBER 31, 2004   APPRECIATION
- -------------------------------------------------------------------------------
Nektar Therapeutics      6/25/03   $3,568,000         $5,090,133     $1,522,133

- --------------------------------------------------------------------------------
7. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.




REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER MAIN STREET FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Main Street Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Main Street Fund/VA as of December 31, 2004, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005


STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

COMMON STOCKS--98.8%
- --------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--12.4%
- --------------------------------------------------------------------------------------
AUTO COMPONENTS--0.2%
Aftermarket Technology Corp. 1                                  252   $         4,057
- --------------------------------------------------------------------------------------
ArvinMeritor, Inc.                                            9,900           221,463
- --------------------------------------------------------------------------------------
Autoliv, Inc.                                                27,400         1,323,420
- --------------------------------------------------------------------------------------
Dana Corp.                                                   65,200         1,129,916
- --------------------------------------------------------------------------------------
Delphi Corp.                                                 16,100           145,222
- --------------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. 1                                 53,600           785,776
- --------------------------------------------------------------------------------------
Lear Corp.                                                    1,800           109,818
- --------------------------------------------------------------------------------------
Visteon Corp.                                                26,800           261,836
                                                                      ----------------
                                                                            3,981,508

- --------------------------------------------------------------------------------------
AUTOMOBILES--0.5%
Ford Motor Co.                                              254,415         3,724,636
- --------------------------------------------------------------------------------------
General Motors Corp.                                         42,900         1,718,574
- --------------------------------------------------------------------------------------
Harley-Davidson, Inc.                                        42,800         2,600,100
- --------------------------------------------------------------------------------------
Thor Industries, Inc.                                         3,400           125,970
- --------------------------------------------------------------------------------------
Winnebago Industries, Inc.                                    9,700           378,882
                                                                      ----------------
                                                                            8,548,162

- --------------------------------------------------------------------------------------
DISTRIBUTORS--0.0%
Genuine Parts Co.                                             7,700           339,262
- --------------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--1.3%
Applebee's International, Inc.                               12,100           320,045
- --------------------------------------------------------------------------------------
Aztar Corp. 1                                                 2,900           101,268
- --------------------------------------------------------------------------------------
Caesars Entertainment, Inc. 1                                45,900           924,426
- --------------------------------------------------------------------------------------
CBRL Group, Inc.                                             19,900           832,815
- --------------------------------------------------------------------------------------
CEC Entertainment, Inc. 1                                    24,300           971,271
- --------------------------------------------------------------------------------------
Choice Hotels International, Inc.                             3,300           191,400
- --------------------------------------------------------------------------------------
Darden Restaurants, Inc.                                      7,700           213,598
- --------------------------------------------------------------------------------------
International Game Technology                                74,900         2,575,062
- --------------------------------------------------------------------------------------
Isle of Capri Casinos, Inc. 1                                 1,500            38,475
- --------------------------------------------------------------------------------------
Jack in the Box, Inc. 1                                       5,400           199,098
- --------------------------------------------------------------------------------------
Mandalay Resort Group                                        19,600         1,380,428
- --------------------------------------------------------------------------------------
Marriott International, Inc., Cl. A                          48,300         3,041,934
- --------------------------------------------------------------------------------------
McDonald's Corp.                                            159,350         5,108,761
- --------------------------------------------------------------------------------------
MGM Mirage, Inc. 1                                            7,700           560,098
- --------------------------------------------------------------------------------------
P.F. Chang's China Bistro, Inc. 1                             2,700           152,145
- --------------------------------------------------------------------------------------
Rare Hospitality International, Inc. 1                        7,000           223,020
- --------------------------------------------------------------------------------------
Sonic Corp. 1                                                 2,800            85,400
- --------------------------------------------------------------------------------------
Starbucks Corp. 1                                            26,300         1,640,068
- --------------------------------------------------------------------------------------
Yum! Brands, Inc.                                            37,700         1,778,686
                                                                      ----------------
                                                                           20,337,998


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

HOUSEHOLD DURABLES--0.8%
American Greetings Corp., Cl. A                              21,700   $       550,095
- --------------------------------------------------------------------------------------
Beazer Homes USA, Inc.                                        2,100           307,041
- --------------------------------------------------------------------------------------
Black & Decker Corp.                                         14,700         1,298,451
- --------------------------------------------------------------------------------------
Cavco Industries, Inc. 1                                        815            36,634
- --------------------------------------------------------------------------------------
Ethan Allen Interiors, Inc.                                  10,100           404,202
- --------------------------------------------------------------------------------------
Furniture Brands International, Inc.                          6,700           167,835
- --------------------------------------------------------------------------------------
Harman International Industries, Inc.                         5,200           660,400
- --------------------------------------------------------------------------------------
Hovnanian Enterprises, Inc., Cl. A  1                         1,700            84,184
- --------------------------------------------------------------------------------------
KB Home                                                      11,800         1,231,920
- --------------------------------------------------------------------------------------
Leggett & Platt, Inc.                                        23,400           665,262
- --------------------------------------------------------------------------------------
Lennar Corp., Cl. B                                           9,160           478,244
- --------------------------------------------------------------------------------------
M.D.C. Holdings, Inc.                                        13,133         1,135,217
- --------------------------------------------------------------------------------------
Meritage Homes Corp. 1                                        8,200           924,140
- --------------------------------------------------------------------------------------
Newell Rubbermaid, Inc.                                      70,000         1,693,300
- --------------------------------------------------------------------------------------
NVR, Inc. 1                                                     800           615,520
- --------------------------------------------------------------------------------------
Ryland Group, Inc. (The)                                     13,600           782,544
- --------------------------------------------------------------------------------------
Stanley Works (The)                                          11,800           578,082
- --------------------------------------------------------------------------------------
Whirlpool Corp.                                               8,800           609,048
                                                                      ----------------
                                                                           12,222,119

- --------------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL--0.7%
Amazon.com, Inc. 1                                           24,400         1,080,676
- --------------------------------------------------------------------------------------
eBay, Inc. 1                                                 71,000         8,255,880
- --------------------------------------------------------------------------------------
IAC/InterActiveCorp 1                                        94,400         2,607,328
                                                                      ----------------
                                                                           11,943,884

- --------------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--0.2%
Action Performance Cos., Inc.                                31,100           341,789
- --------------------------------------------------------------------------------------
Eastman Kodak Co.                                            17,500           564,375
- --------------------------------------------------------------------------------------
Hasbro, Inc.                                                 33,800           655,044
- --------------------------------------------------------------------------------------
Leapfrog Enterprises, Inc. 1                                  3,000            40,800
- --------------------------------------------------------------------------------------
Marvel Enterprises, Inc. 1                                   18,200           372,736
- --------------------------------------------------------------------------------------
Nautilus Group, Inc. (The)                                    7,400           178,858
- --------------------------------------------------------------------------------------
Polaris Industries, Inc.                                      5,600           380,912
- --------------------------------------------------------------------------------------
SCP Pool Corp.                                                5,600           178,640
                                                                      ----------------
                                                                            2,713,154

- --------------------------------------------------------------------------------------
MEDIA--3.7%
Charter Communications, Inc., Cl. A 1                       169,900           380,576
- --------------------------------------------------------------------------------------
Clear Channel Communications, Inc.                           76,700         2,568,683
- --------------------------------------------------------------------------------------
Comcast Corp., Cl. A 1                                      388,115        12,916,467
- --------------------------------------------------------------------------------------
EchoStar Communications Corp.,
Cl. A                                                        40,100         1,332,924
- --------------------------------------------------------------------------------------
Fox Entertainment Group, Inc.,
A Shares 1                                                    2,800            87,528
- --------------------------------------------------------------------------------------
Gannett Co., Inc.                                             7,300           596,410
- --------------------------------------------------------------------------------------
Getty Images, Inc. 1                                          8,000           550,800



                       8 | OPPENHEIMER MAIN STREET FUND/VA




                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

MEDIA Continued
Knight-Ridder, Inc.                                           9,700   $       649,318
- --------------------------------------------------------------------------------------
Martha Stewart Living Omnimedia,
Inc., Cl. A 1                                                15,300           444,006
- --------------------------------------------------------------------------------------
McGraw-Hill Cos., Inc. (The)                                 39,000         3,570,060
- --------------------------------------------------------------------------------------
NTL, Inc. 1                                                   4,000           291,840
- --------------------------------------------------------------------------------------
Pixar, Inc. 1                                                 1,600           136,976
- --------------------------------------------------------------------------------------
Time Warner, Inc. 1                                         794,900        15,452,856
- --------------------------------------------------------------------------------------
Viacom, Inc., Cl. B                                         249,046         9,062,784
- --------------------------------------------------------------------------------------
Walt Disney Co. (The)                                       409,700        11,389,660
- --------------------------------------------------------------------------------------
Westwood One, Inc. 1                                         18,400           495,512
                                                                      ----------------
                                                                           59,926,400

- --------------------------------------------------------------------------------------
MULTILINE RETAIL--0.9%
Dillard's, Inc., Cl. A                                       23,600           634,132
- --------------------------------------------------------------------------------------
Federated Department Stores, Inc.                            43,800         2,531,202
- --------------------------------------------------------------------------------------
J.C. Penney Co., Inc. (Holding Co.)                          79,900         3,307,860
- --------------------------------------------------------------------------------------
Kmart Holding Corp. 1                                         9,900           979,605
- --------------------------------------------------------------------------------------
Kohl's Corp. 1                                                3,500           172,095
- --------------------------------------------------------------------------------------
Neiman Marcus Group, Inc.
(The), Cl. A                                                  1,500           107,310
- --------------------------------------------------------------------------------------
Nordstrom, Inc.                                              26,800         1,252,364
- --------------------------------------------------------------------------------------
Sears Roebuck & Co.                                          33,000         1,683,990
- --------------------------------------------------------------------------------------
Target Corp.                                                 69,300         3,598,749
                                                                      ----------------
                                                                           14,267,307

- --------------------------------------------------------------------------------------
SPECIALTY RETAIL--3.7%
Abercrombie & Fitch Co., Cl. A                               33,700         1,582,215
- --------------------------------------------------------------------------------------
Aeropostale, Inc. 1                                          23,000           676,890
- --------------------------------------------------------------------------------------
American Eagle Outfitters, Inc.                              29,300         1,380,030
- --------------------------------------------------------------------------------------
AnnTaylor Stores Corp. 1                                     21,600           465,048
- --------------------------------------------------------------------------------------
AutoNation, Inc. 1                                           16,200           311,202
- --------------------------------------------------------------------------------------
Barnes & Noble, Inc. 1                                       15,700           506,639
- --------------------------------------------------------------------------------------
bebe stores, inc.                                             4,650           125,457
- --------------------------------------------------------------------------------------
Bed Bath & Beyond, Inc. 1                                    36,700         1,461,761
- --------------------------------------------------------------------------------------
Best Buy Co., Inc.                                           41,700         2,477,814
- --------------------------------------------------------------------------------------
Blockbuster, Inc., Cl. B                                     56,956           501,782
- --------------------------------------------------------------------------------------
Borders Group, Inc.                                          45,100         1,145,540
- --------------------------------------------------------------------------------------
Children's Place Retail Stores, Inc. 1                        6,000           222,180
- --------------------------------------------------------------------------------------
Christopher & Banks Corp.                                     3,400            62,730
- --------------------------------------------------------------------------------------
Circuit City Stores, Inc./
Circuit City Group                                           93,500         1,462,340
- --------------------------------------------------------------------------------------
Claire's Stores, Inc.                                        42,400           901,000
- --------------------------------------------------------------------------------------
Electronics Boutique Holdings Corp. 1                         5,500           236,170
- --------------------------------------------------------------------------------------
Finish Line, Inc. (The), Cl. A                                7,600           139,080
- --------------------------------------------------------------------------------------
Gap, Inc. (The)                                             142,300         3,005,376
- --------------------------------------------------------------------------------------
Hollywood Entertainment Corp. 1                              11,200           146,608
- --------------------------------------------------------------------------------------
Home Depot, Inc.                                            442,100        18,895,354


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

SPECIALTY RETAIL Continued
Hot Topic, Inc. 1                                            13,100   $       225,189
- --------------------------------------------------------------------------------------
Limited Brands, Inc.                                        107,400         2,472,348
- --------------------------------------------------------------------------------------
Lowe's Cos., Inc.                                            65,600         3,777,904
- --------------------------------------------------------------------------------------
Men's Wearhouse, Inc. (The) 1                                 5,300           169,388
- --------------------------------------------------------------------------------------
Michaels Stores, Inc.                                        35,000         1,048,950
- --------------------------------------------------------------------------------------
Office Depot, Inc. 1                                         77,900         1,352,344
- --------------------------------------------------------------------------------------
Pacific Sunwear of California, Inc. 1                        43,775           974,432
- --------------------------------------------------------------------------------------
Petco Animal Supplies, Inc. 1                                 3,500           138,180
- --------------------------------------------------------------------------------------
PETsMART, Inc.                                                9,500           337,535
- --------------------------------------------------------------------------------------
Pier 1 Imports, Inc.                                          1,400            27,580
- --------------------------------------------------------------------------------------
Rent-A-Center, Inc. 1                                         4,200           111,300
- --------------------------------------------------------------------------------------
Sherwin-Williams Co.                                         25,000         1,115,750
- --------------------------------------------------------------------------------------
Staples, Inc.                                               126,500         4,264,315
- --------------------------------------------------------------------------------------
Talbots, Inc. (The)                                          20,100           547,323
- --------------------------------------------------------------------------------------
Tiffany & Co.                                                19,200           613,824
- --------------------------------------------------------------------------------------
TJX Cos., Inc. (The)                                        129,500         3,254,335
- --------------------------------------------------------------------------------------
Too, Inc. 1                                                  12,800           313,088
- --------------------------------------------------------------------------------------
Toys R Us, Inc. 1                                            69,100         1,414,477
- --------------------------------------------------------------------------------------
Urban Outfitters, Inc. 1                                      7,800           346,320
- --------------------------------------------------------------------------------------
Zale Corp. 1                                                 23,500           701,945
                                                                      ----------------
                                                                           58,911,743

- --------------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--0.4%
Coach, Inc. 1                                                19,000         1,071,600
- --------------------------------------------------------------------------------------
Deckers Outdoor Corp. 1                                       2,000            93,980
- --------------------------------------------------------------------------------------
Jones Apparel Group, Inc.                                    29,000         1,060,530
- --------------------------------------------------------------------------------------
Nike, Inc., Cl. B                                            19,000         1,723,110
- --------------------------------------------------------------------------------------
Timberland Co., Cl. A 1                                      19,400         1,215,798
- --------------------------------------------------------------------------------------
VF Corp.                                                     15,500           858,390
                                                                      ----------------
                                                                            6,023,408

- --------------------------------------------------------------------------------------
CONSUMER STAPLES--8.7%
- --------------------------------------------------------------------------------------
BEVERAGES--2.3%
Anheuser-Busch Cos., Inc.                                    49,600         2,516,208
- --------------------------------------------------------------------------------------
Brown-Forman Corp., Cl. B                                     2,200           107,096
- --------------------------------------------------------------------------------------
Coca-Cola Co. (The)                                         360,800        15,020,104
- --------------------------------------------------------------------------------------
Pepsi Bottling Group, Inc. (The)                             43,100         1,165,424
- --------------------------------------------------------------------------------------
PepsiAmericas, Inc.                                           3,500            74,340
- --------------------------------------------------------------------------------------
PepsiCo, Inc.                                               352,150        18,382,230
                                                                      ----------------
                                                                           37,265,402

- --------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--2.3%
BJ's Wholesale Club, Inc. 1                                  20,500           597,165
- --------------------------------------------------------------------------------------
Costco Wholesale Corp.                                       47,000         2,275,270
- --------------------------------------------------------------------------------------
Kroger Co. (The) 1                                           41,700           731,418
- --------------------------------------------------------------------------------------
Rite Aid Corp. 1                                             76,700           280,722



                       9 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

FOOD & STAPLES RETAILING Continued
Safeway, Inc. 1                                              33,400   $       659,316
- --------------------------------------------------------------------------------------
SUPERVALU, Inc.                                              30,800         1,063,216
- --------------------------------------------------------------------------------------
Sysco Corp.                                                 106,500         4,065,105
- --------------------------------------------------------------------------------------
Wal-Mart Stores, Inc.                                       435,000        22,976,700
- --------------------------------------------------------------------------------------
Walgreen Co.                                                 91,300         3,503,181
- --------------------------------------------------------------------------------------
Whole Foods Market, Inc.                                      4,000           381,400
                                                                      ----------------
                                                                           36,533,493

- --------------------------------------------------------------------------------------
FOOD PRODUCTS--0.6%
Archer-Daniels-Midland Co.                                   40,300           899,093
- --------------------------------------------------------------------------------------
ConAgra Foods, Inc.                                          11,400           335,730
- --------------------------------------------------------------------------------------
Corn Products International, Inc.                             6,800           364,208
- --------------------------------------------------------------------------------------
Heinz (H.J.) Co.                                             81,000         3,158,190
- --------------------------------------------------------------------------------------
Kellogg Co.                                                   2,400           107,184
- --------------------------------------------------------------------------------------
Kraft Foods, Inc., Cl. A 1                                   41,500         1,477,815
- --------------------------------------------------------------------------------------
Pilgrim's Pride Corp., Cl. B                                  3,300           101,244
- --------------------------------------------------------------------------------------
Sara Lee Corp.                                              105,000         2,534,700
- --------------------------------------------------------------------------------------
Smithfield Foods, Inc. 1                                      1,400            41,426
- --------------------------------------------------------------------------------------
Tyson Foods, Inc., Cl. A                                     56,300         1,035,920
- --------------------------------------------------------------------------------------
Wm. Wrigley Jr. Co.                                           5,200           359,788
                                                                      ----------------
                                                                           10,415,298

- --------------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--1.8%
Clorox Co. (The)                                              7,000           412,510
- --------------------------------------------------------------------------------------
Energizer Holdings, Inc. 1                                   10,800           536,652
- --------------------------------------------------------------------------------------
Kimberly-Clark Corp.                                         55,000         3,619,550
- --------------------------------------------------------------------------------------
Nu Skin Asia Pacific, Inc., Cl. A                            12,900           327,402
- --------------------------------------------------------------------------------------
Procter & Gamble Co. (The)                                  419,700        23,117,076
- --------------------------------------------------------------------------------------
Rayovac Corp. 1                                               7,200           220,032
                                                                      ----------------
                                                                           28,233,222

- --------------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.4%
Avon Products, Inc.                                          31,600         1,222,920
- --------------------------------------------------------------------------------------
Estee Lauder Cos., Inc. (The), Cl. A                         51,300         2,348,001
- --------------------------------------------------------------------------------------
Gillette Co.                                                 80,400         3,600,312
- --------------------------------------------------------------------------------------
NBTY, Inc. 1                                                  2,200            52,822
                                                                      ----------------
                                                                            7,224,055

- --------------------------------------------------------------------------------------
TOBACCO--1.3%
Altria Group, Inc.                                          327,500        20,010,250
- --------------------------------------------------------------------------------------
Reynolds American, Inc.                                       7,800           613,080
- --------------------------------------------------------------------------------------
UST, Inc.                                                    10,900           524,399
                                                                      ----------------
                                                                           21,147,729


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

ENERGY--7.7%
- --------------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.5%
Atwood Oceanics, Inc. 1                                       3,000   $       156,300
- --------------------------------------------------------------------------------------
BJ Services Co.                                              17,200           800,488
- --------------------------------------------------------------------------------------
Cal Dive International, Inc. 1                               14,200           578,650
- --------------------------------------------------------------------------------------
Diamond Offshore Drilling, Inc.                              35,700         1,429,785
- --------------------------------------------------------------------------------------
Grant Prideco, Inc. 1                                        28,300           567,415
- --------------------------------------------------------------------------------------
Halliburton Co.                                              33,700         1,322,388
- --------------------------------------------------------------------------------------
Hydril Co. 1                                                  1,800            81,918
- --------------------------------------------------------------------------------------
Lone Star Technologies, Inc. 1                                7,600           254,296
- --------------------------------------------------------------------------------------
Oil States International, Inc. 1                             28,700           553,623
- --------------------------------------------------------------------------------------
Precision Drilling Corp. 1                                    6,300           397,092
- --------------------------------------------------------------------------------------
Pride International, Inc. 1                                  11,700           240,318
- --------------------------------------------------------------------------------------
Smith International, Inc. 1                                   6,900           375,429
- --------------------------------------------------------------------------------------
Universal Compression Holdings, Inc. 1                       13,600           474,776
                                                                      ----------------
                                                                            7,232,478

- --------------------------------------------------------------------------------------
OIL & GAS--7.2%
Amerada Hess Corp.                                           20,500         1,688,790
- --------------------------------------------------------------------------------------
Apache Corp.                                                 43,500         2,199,795
- --------------------------------------------------------------------------------------
Ashland, Inc.                                                 9,900           577,962
- --------------------------------------------------------------------------------------
Cabot Oil & Gas Corp., Cl. A                                  1,900            84,075
- --------------------------------------------------------------------------------------
Canadian Natural Resources Ltd.                              60,700         2,596,399
- --------------------------------------------------------------------------------------
Chesapeake Energy Corp.                                      47,500           783,750
- --------------------------------------------------------------------------------------
ChevronTexaco Corp.                                         304,000        15,963,040
- --------------------------------------------------------------------------------------
Cimarex Energy Co. 1                                         10,439           395,638
- --------------------------------------------------------------------------------------
ConocoPhillips                                               88,021         7,642,863
- --------------------------------------------------------------------------------------
Devon Energy Corp.                                           48,300         1,879,836
- --------------------------------------------------------------------------------------
El Paso Corp.                                                17,500           182,000
- --------------------------------------------------------------------------------------
EOG Resources, Inc.                                          19,300         1,377,248
- --------------------------------------------------------------------------------------
Exxon Mobil Corp.                                         1,106,516        56,720,010
- --------------------------------------------------------------------------------------
Forest Oil Corp. 1                                            8,000           253,760
- --------------------------------------------------------------------------------------
Frontier Oil Corp.                                          115,900         3,089,894
- --------------------------------------------------------------------------------------
General Maritime Corp. 1                                     12,600           503,370
- --------------------------------------------------------------------------------------
Houston Exploration Co. 1                                    12,500           703,875
- --------------------------------------------------------------------------------------
Kerr-McGee Corp.                                             12,300           710,817
- --------------------------------------------------------------------------------------
Murphy Oil Corp.                                              5,400           434,430
- --------------------------------------------------------------------------------------
Newfield Exploration Co. 1                                   14,500           856,225
- --------------------------------------------------------------------------------------
Noble Energy, Inc.                                           13,900           857,074
- --------------------------------------------------------------------------------------
Occidental Petroleum Corp.                                   31,900         1,861,684
- --------------------------------------------------------------------------------------
OMI Corp.                                                    28,700           483,595
- --------------------------------------------------------------------------------------
Paramount Resources Ltd. 1                                  155,200         3,484,439
- --------------------------------------------------------------------------------------
Patina Oil & Gas Corp.                                        6,900           258,750
- --------------------------------------------------------------------------------------
Petroleum Development Corp. 1                                 4,600           177,422
- --------------------------------------------------------------------------------------
Pioneer Natural Resources Co.                                 8,600           301,860
- --------------------------------------------------------------------------------------
Plains Exploration & Production Co. 1                         9,200           239,200



                      10 | OPPENHEIMER MAIN STREET FUND/VA




                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

OIL & GAS Continued
Premcor, Inc.                                                 5,400   $       227,718
- --------------------------------------------------------------------------------------
Southwestern Energy Co. 1                                     4,000           202,760
- --------------------------------------------------------------------------------------
Sunoco, Inc.                                                 20,800         1,699,568
- --------------------------------------------------------------------------------------
Talisman Energy, Inc.                                        91,000         2,456,996
- --------------------------------------------------------------------------------------
Teekay Shipping Corp.                                        14,100           593,751
- --------------------------------------------------------------------------------------
Tesoro Corp. 1                                               34,100         1,086,426
- --------------------------------------------------------------------------------------
Unocal Corp.                                                 43,400         1,876,616
- --------------------------------------------------------------------------------------
Valero Energy Corp.                                          27,200         1,234,880
- --------------------------------------------------------------------------------------
Vintage Petroleum, Inc.                                       7,400           167,906
- --------------------------------------------------------------------------------------
Williams Cos., Inc. (The)                                    34,800           566,892
                                                                      ----------------
                                                                          116,421,314

- --------------------------------------------------------------------------------------
FINANCIALS--21.7%
- --------------------------------------------------------------------------------------
CAPITAL MARKETS--0.4%
Bank of New York Co., Inc. (The)                            101,400         3,388,788
- --------------------------------------------------------------------------------------
Mellon Financial Corp.                                       29,800           927,078
- --------------------------------------------------------------------------------------
Northern Trust Corp.                                         27,700         1,345,666
                                                                      ----------------
                                                                            5,661,532

- --------------------------------------------------------------------------------------
COMMERCIAL BANKS--6.9%
Associated Banc-Corp.                                         3,400           112,914
- --------------------------------------------------------------------------------------
Astoria Financial Corp.                                      15,600           623,532
- --------------------------------------------------------------------------------------
Bank of America Corp.                                       800,402        37,610,890
- --------------------------------------------------------------------------------------
Banknorth Group, Inc.                                        34,400         1,259,040
- --------------------------------------------------------------------------------------
BB&T Corp.                                                   36,300         1,526,415
- --------------------------------------------------------------------------------------
Comerica, Inc.                                               44,900         2,739,798
- --------------------------------------------------------------------------------------
Compass Bancshares, Inc.                                      8,900           433,163
- --------------------------------------------------------------------------------------
Fifth Third Bancorp                                          39,200         1,853,376
- --------------------------------------------------------------------------------------
First Horizon National Corp.                                  4,900           211,239
- --------------------------------------------------------------------------------------
Golden West Financial Corp.                                  15,500           952,010
- --------------------------------------------------------------------------------------
Hibernia Corp., Cl. A                                        26,200           773,162
- --------------------------------------------------------------------------------------
Huntington Bancshares, Inc.                                  16,500           408,870
- --------------------------------------------------------------------------------------
Independence Community
Bank Corp.                                                   12,900           549,282
- --------------------------------------------------------------------------------------
Indymac Mortgage Holdings, Inc.                              10,900           375,505
- --------------------------------------------------------------------------------------
KeyCorp                                                      66,300         2,247,570
- --------------------------------------------------------------------------------------
M&T Bank Corp.                                               13,600         1,466,624
- --------------------------------------------------------------------------------------
National City Corp.                                          52,900         1,986,395
- --------------------------------------------------------------------------------------
North Fork Bancorporation, Inc.                              33,256           959,436
- --------------------------------------------------------------------------------------
PNC Financial Services Group, Inc.                           39,000         2,240,160
- --------------------------------------------------------------------------------------
R&G Financial Corp., Cl. B                                    2,500            97,200
- --------------------------------------------------------------------------------------
Regions Financial Corp.                                      21,605           768,922
- --------------------------------------------------------------------------------------
Silicon Valley Bancshares 1                                   5,200           233,064
- --------------------------------------------------------------------------------------
Sterling Financial Corp. (Western US)                         1,100            43,186
- --------------------------------------------------------------------------------------
SunTrust Banks, Inc.                                         42,300         3,125,124
- --------------------------------------------------------------------------------------
U.S. Bancorp                                                464,270        14,540,936


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------


COMMERCIAL BANKS Continued
UnionBanCal Corp.                                            39,800   $     2,566,304
- --------------------------------------------------------------------------------------
Wachovia Corp.                                              245,200        12,897,520
- --------------------------------------------------------------------------------------
Washington Mutual, Inc.                                      41,100         1,737,708
- --------------------------------------------------------------------------------------
Webster Financial Corp.                                       6,700           339,288
- --------------------------------------------------------------------------------------
Wells Fargo & Co.                                           263,600        16,382,740
- --------------------------------------------------------------------------------------
Zions Bancorp                                                10,500           714,315
                                                                      ----------------
                                                                          111,775,688

- --------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--8.5%
Affiliated Managers Group, Inc. 1                            11,850           802,719
- --------------------------------------------------------------------------------------
American Capital Strategies Ltd.                             15,100           503,585
- --------------------------------------------------------------------------------------
American Express Co.                                        132,100         7,446,477
- --------------------------------------------------------------------------------------
Bear Stearns Cos., Inc. (The)                                34,900         3,570,619
- --------------------------------------------------------------------------------------
Capital One Financial Corp.                                  27,200         2,290,512
- --------------------------------------------------------------------------------------
Chicago Mercantile Exchange (The)                               400            91,480
- --------------------------------------------------------------------------------------
CIT Group, Inc.                                              34,000         1,557,880
- --------------------------------------------------------------------------------------
Citigroup, Inc.                                             967,088        46,594,300
- --------------------------------------------------------------------------------------
E*TRADE Financial Corp. 1                                    72,500         1,083,875
- --------------------------------------------------------------------------------------
Federated Investors, Inc., Cl. B                              5,500           167,200
- --------------------------------------------------------------------------------------
Franklin Resources, Inc.                                      7,900           550,235
- --------------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The)                              20,400         2,122,416
- --------------------------------------------------------------------------------------
JPMorgan Chase & Co.                                        811,644        31,662,232
- --------------------------------------------------------------------------------------
Knight Trading Group, Inc. 1                                  2,500            27,375
- --------------------------------------------------------------------------------------
Legg Mason, Inc.                                              4,150           304,029
- --------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.                               26,400         2,309,472
- --------------------------------------------------------------------------------------
MBNA Corp.                                                  168,100         4,738,739
- --------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc.                                   150,200         8,977,454
- --------------------------------------------------------------------------------------
Moody's Corp.                                                 5,900           512,415
- --------------------------------------------------------------------------------------
Morgan Stanley                                              236,100        13,108,272
- --------------------------------------------------------------------------------------
Principal Financial Group, Inc. (The)                        68,500         2,804,390
- --------------------------------------------------------------------------------------
Schwab (Charles) Corp.                                      219,400         2,624,024
- --------------------------------------------------------------------------------------
SEI Investments Co.                                           7,800           327,054
- --------------------------------------------------------------------------------------
SLM Corp.                                                    16,700           891,613
- --------------------------------------------------------------------------------------
State Street Corp.                                           20,800         1,021,696
- --------------------------------------------------------------------------------------
T. Rowe Price Group, Inc.                                    13,000           808,600
- --------------------------------------------------------------------------------------
WFS Financial, Inc.                                             400            20,312
                                                                      ----------------
                                                                          136,918,975

- --------------------------------------------------------------------------------------
INSURANCE--4.0%
ACE Ltd.                                                     28,000         1,197,000
- --------------------------------------------------------------------------------------
AFLAC, Inc.                                                  87,200         3,474,048
- --------------------------------------------------------------------------------------
Allmerica Financial Corp. 1                                   9,700           318,451
- --------------------------------------------------------------------------------------
Allstate Corp.                                              106,600         5,513,352
- --------------------------------------------------------------------------------------
AMBAC Financial Group, Inc.                                   3,400           279,242
- --------------------------------------------------------------------------------------
American Financial Group, Inc.                               11,800           369,458
- --------------------------------------------------------------------------------------
American International Group, Inc.                          451,540        29,652,632



                      11 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

INSURANCE Continued
AmerUs Group Co.                                              3,700   $       167,610
- --------------------------------------------------------------------------------------
Aon Corp.                                                    61,600         1,469,776
- --------------------------------------------------------------------------------------
Chubb Corp.                                                  12,400           953,560
- --------------------------------------------------------------------------------------
Cincinnati Financial Corp.                                   17,070           755,518
- --------------------------------------------------------------------------------------
Fidelity National Financial, Inc.                            39,659         1,811,227
- --------------------------------------------------------------------------------------
First American Corp. (The)                                   10,000           351,400
- --------------------------------------------------------------------------------------
Hartford Financial Services
Group, Inc. (The)                                            48,600         3,368,466
- --------------------------------------------------------------------------------------
Jefferson-Pilot Corp.                                         8,000           415,680
- --------------------------------------------------------------------------------------
LandAmerica Financial Group, Inc.                             7,900           426,047
- --------------------------------------------------------------------------------------
Lincoln National Corp.                                       29,600         1,381,728
- --------------------------------------------------------------------------------------
Loews Corp.                                                  24,300         1,708,290
- --------------------------------------------------------------------------------------
Marsh & McLennan Cos., Inc.                                  31,100         1,023,190
- --------------------------------------------------------------------------------------
MBIA, Inc.                                                   15,700           993,496
- --------------------------------------------------------------------------------------
MetLife, Inc.                                                33,600         1,361,136
- --------------------------------------------------------------------------------------
Nationwide Financial Services,
Inc., Cl. A                                                  17,400           665,202
- --------------------------------------------------------------------------------------
Old Republic International Corp.                             10,400           263,120
- --------------------------------------------------------------------------------------
Progressive Corp.                                             7,300           619,332
- --------------------------------------------------------------------------------------
Reinsurance Group of America, Inc.                           22,000         1,065,900
- --------------------------------------------------------------------------------------
RenaissanceRe Holdings Ltd.                                   6,500           338,520
- --------------------------------------------------------------------------------------
Safeco Corp.                                                 21,300         1,112,712
- --------------------------------------------------------------------------------------
St. Paul Travelers Cos., Inc. (The)                          17,400           645,018
- --------------------------------------------------------------------------------------
StanCorp Financial Group, Inc.                                4,900           404,250
- --------------------------------------------------------------------------------------
Torchmark Corp.                                              12,000           685,680
- --------------------------------------------------------------------------------------
UICI                                                          2,600            88,140
- --------------------------------------------------------------------------------------
Universal American Financial Corp. 1                          1,000            15,470
- --------------------------------------------------------------------------------------
UnumProvident Corp.                                          64,600         1,158,924
                                                                      ----------------
                                                                           64,053,575

- --------------------------------------------------------------------------------------
REAL ESTATE--0.0%
St. Joe Co. (The)                                             3,600           231,120
- --------------------------------------------------------------------------------------
THRIFTS & MORTGAGE FINANCE--1.9%
Countrywide Financial Corp.                                  77,498         2,868,201
- --------------------------------------------------------------------------------------
Fannie Mae                                                  195,000        13,885,950
- --------------------------------------------------------------------------------------
Freddie Mac                                                 148,000        10,907,600
- --------------------------------------------------------------------------------------
Fremont General Corp.                                        33,200           835,976
- --------------------------------------------------------------------------------------
MGIC Investment Corp.                                        25,200         1,736,532
- --------------------------------------------------------------------------------------
Radian Group, Inc.                                           22,700         1,208,548
                                                                      ----------------
                                                                           31,442,807

- --------------------------------------------------------------------------------------
HEALTH CARE--12.4%
- --------------------------------------------------------------------------------------
BIOTECHNOLOGY--1.1%
Amgen, Inc. 1                                               145,500         9,333,825
- --------------------------------------------------------------------------------------
Applera Corp./Applied
Biosystems Group                                             45,800           957,678
- --------------------------------------------------------------------------------------
Gen-Probe, Inc. 1                                            11,400           515,394



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

BIOTECHNOLOGY Continued
Millennium Pharmaceuticals, Inc. 1                           43,800   $       530,856
- --------------------------------------------------------------------------------------
Onyx Pharmaceuticals, Inc. 1                                  2,600            84,214
- --------------------------------------------------------------------------------------
United Therapeutics Corp. 1                                   8,000           361,200
- --------------------------------------------------------------------------------------
Wyeth                                                       148,800         6,337,392
                                                                      ----------------
                                                                           18,120,559

- --------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--1.4%
Bausch & Lomb, Inc.                                           8,700           560,802
- --------------------------------------------------------------------------------------
Baxter International, Inc.                                   19,000           656,260
- --------------------------------------------------------------------------------------
Becton, Dickinson & Co.                                      44,900         2,550,320
- --------------------------------------------------------------------------------------
Biomet, Inc.                                                  4,700           203,933
- --------------------------------------------------------------------------------------
Boston Scientific Corp. 1                                    32,500         1,155,375
- --------------------------------------------------------------------------------------
Dade Behring Holdings, Inc. 1                                 2,000           112,000
- --------------------------------------------------------------------------------------
Hospira, Inc. 1                                              35,380         1,185,230
- --------------------------------------------------------------------------------------
Idexx Laboratories, Inc. 1                                    1,200            65,508
- --------------------------------------------------------------------------------------
Inamed Corp. 1                                                1,700           107,525
- --------------------------------------------------------------------------------------
Medtronic, Inc.                                             194,100         9,640,947
- --------------------------------------------------------------------------------------
PerkinElmer, Inc.                                            50,600         1,137,994
- --------------------------------------------------------------------------------------
Respironics, Inc. 1                                           1,800            97,848
- --------------------------------------------------------------------------------------
Stryker Corp.                                                65,900         3,179,675
- --------------------------------------------------------------------------------------
Thermo Electron Corp. 1                                      44,300         1,337,417
- --------------------------------------------------------------------------------------
Varian Medical Systems, Inc. 1                               12,900           557,796
- --------------------------------------------------------------------------------------
VISX, Inc. 1                                                  9,800           253,526
- --------------------------------------------------------------------------------------
Wright Medical Group, Inc. 1                                  5,200           148,200
                                                                      ----------------
                                                                           22,950,356

- --------------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--2.4%
Advisory Board Co. (The) 1                                    2,900           106,952
- --------------------------------------------------------------------------------------
Aetna, Inc.                                                  26,700         3,330,825
- --------------------------------------------------------------------------------------
Amedisys, Inc. 1                                              2,800            90,692
- --------------------------------------------------------------------------------------
AmerisourceBergen Corp.                                      20,200         1,185,336
- --------------------------------------------------------------------------------------
Andrx Corp. 1                                                15,900           347,097
- --------------------------------------------------------------------------------------
Caremark Rx, Inc. 1                                          29,300         1,155,299
- --------------------------------------------------------------------------------------
Cerner Corp. 1                                                3,300           175,461
- --------------------------------------------------------------------------------------
CIGNA Corp.                                                  37,600         3,067,032
- --------------------------------------------------------------------------------------
Covance, Inc. 1                                              16,700           647,125
- --------------------------------------------------------------------------------------
Coventry Health Care, Inc. 1                                 19,950         1,058,946
- --------------------------------------------------------------------------------------
DaVita, Inc. 1                                                1,700            67,201
- --------------------------------------------------------------------------------------
eResearch Technology, Inc. 1                                  4,900            77,665
- --------------------------------------------------------------------------------------
Express Scripts, Inc. 1                                       2,200           168,168
- --------------------------------------------------------------------------------------
Gentiva Health Services, Inc. 1                               1,000            16,720
- --------------------------------------------------------------------------------------
HCA, Inc.                                                     8,200           327,672
- --------------------------------------------------------------------------------------
Humana, Inc. 1                                               36,200         1,074,778
- --------------------------------------------------------------------------------------
IMS Health, Inc.                                             10,800           250,668
- --------------------------------------------------------------------------------------
Laboratory Corp. of America
Holdings 1                                                   14,700           732,354



                      12 | OPPENHEIMER MAIN STREET FUND/VA




                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

HEALTH CARE PROVIDERS & SERVICES Continued
LCA-Vision, Inc.                                             14,400   $       336,816
- --------------------------------------------------------------------------------------
McKesson Corp.                                               19,200           604,032
- --------------------------------------------------------------------------------------
Medco Health Solutions, Inc. 1                               51,281         2,133,290
- --------------------------------------------------------------------------------------
PacifiCare Health Systems, Inc. 1                            28,000         1,582,560
- --------------------------------------------------------------------------------------
Pediatrix Medical Group, Inc. 1                              12,300           787,815
- --------------------------------------------------------------------------------------
Quest Diagnostics, Inc.                                      18,900         1,805,895
- --------------------------------------------------------------------------------------
Select Medical Corp.                                          8,200           144,320
- --------------------------------------------------------------------------------------
Sierra Health Services, Inc. 1                                8,600           473,946
- --------------------------------------------------------------------------------------
Sunrise Senior Living, Inc. 1                                 4,900           227,164
- --------------------------------------------------------------------------------------
UnitedHealth Group, Inc.                                    120,624        10,618,531
- --------------------------------------------------------------------------------------
WellChoice, Inc. 1                                           11,000           587,400
- --------------------------------------------------------------------------------------
WellPoint, Inc. 1                                            43,900         5,048,500
                                                                      ----------------
                                                                           38,230,260

- --------------------------------------------------------------------------------------
PHARMACEUTICALS--7.5%
Abbott Laboratories                                         191,500         8,933,475
- --------------------------------------------------------------------------------------
Allergan, Inc.                                               17,400         1,410,618
- --------------------------------------------------------------------------------------
Barr Pharmaceuticals, Inc. 1                                 13,200           601,128
- --------------------------------------------------------------------------------------
Bristol-Myers Squibb Co.                                    389,100         9,968,742
- --------------------------------------------------------------------------------------
Eli Lilly & Co.                                             161,700         9,176,475
- --------------------------------------------------------------------------------------
Endo Pharmaceuticals Holdings, Inc. 1                        40,400           849,208
- --------------------------------------------------------------------------------------
Eon Labs, Inc. 1                                             15,700           423,900
- --------------------------------------------------------------------------------------
Forest Laboratories, Inc. 1                                  68,100         3,054,966
- --------------------------------------------------------------------------------------
Johnson & Johnson                                           497,506        31,551,831
- --------------------------------------------------------------------------------------
Merck & Co., Inc.                                           483,600        15,542,904
- --------------------------------------------------------------------------------------
Pfizer, Inc.                                              1,406,800        37,828,852
- --------------------------------------------------------------------------------------
Schering-Plough Corp.                                        49,500         1,033,560
                                                                      ----------------
                                                                          120,375,659

- --------------------------------------------------------------------------------------
INDUSTRIALS--10.2%
- --------------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.7%
Boeing Co.                                                   70,500         3,649,785
- --------------------------------------------------------------------------------------
General Dynamics Corp.                                       16,600         1,736,360
- --------------------------------------------------------------------------------------
Goodrich Corp.                                                7,800           254,592
- --------------------------------------------------------------------------------------
Honeywell International, Inc.                                62,500         2,213,125
- --------------------------------------------------------------------------------------
Lockheed Martin Corp.                                        25,500         1,416,525
- --------------------------------------------------------------------------------------
Northrop Grumman Corp.                                       59,100         3,212,676
- --------------------------------------------------------------------------------------
Precision Castparts Corp.                                     1,000            65,680
- --------------------------------------------------------------------------------------
Raytheon Co.                                                 34,600         1,343,518
- --------------------------------------------------------------------------------------
Rockwell Collins, Inc.                                        2,200            86,768
- --------------------------------------------------------------------------------------
United Defense Industries, Inc. 1                            10,800           510,300
- --------------------------------------------------------------------------------------
United Technologies Corp.                                   130,800        13,518,180
                                                                      ----------------
                                                                           28,007,509


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

AIR FREIGHT & LOGISTICS--0.5%
EGL, Inc. 1                                                  19,500   $       582,855
- --------------------------------------------------------------------------------------
Expeditors International of
Washington, Inc.                                              6,900           385,572
- --------------------------------------------------------------------------------------
FedEx Corp.                                                  22,600         2,225,874
- --------------------------------------------------------------------------------------
United Parcel Service, Inc., Cl. B                           56,100         4,794,306
                                                                      ----------------
                                                                            7,988,607

- --------------------------------------------------------------------------------------
AIRLINES--0.2%
Alaska Air Group, Inc. 1                                     11,000           368,390
- --------------------------------------------------------------------------------------
AMR Corp. 1                                                  71,700           785,115
- --------------------------------------------------------------------------------------
Continental Airlines, Inc., Cl. B 1                          35,800           484,732
- --------------------------------------------------------------------------------------
Delta Air Lines, Inc. 1                                      80,200           599,896
- --------------------------------------------------------------------------------------
Northwest Airlines Corp., Cl. A 1                            21,500           234,995
                                                                      ----------------
                                                                            2,473,128

- --------------------------------------------------------------------------------------
BUILDING PRODUCTS--0.2%
American Standard Cos., Inc. 1                               15,600           644,592
- --------------------------------------------------------------------------------------
Masco Corp.                                                  32,300         1,179,919
- --------------------------------------------------------------------------------------
USG Corp. 1                                                  16,500           664,455
                                                                      ----------------
                                                                            2,488,966

- --------------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--0.6%
Brink's Co. (The)                                             4,100           162,032
- --------------------------------------------------------------------------------------
Cendant Corp.                                               168,200         3,932,516
- --------------------------------------------------------------------------------------
Cintas Corp.                                                 15,200           666,672
- --------------------------------------------------------------------------------------
Copart, Inc. 1                                               16,200           426,384
- --------------------------------------------------------------------------------------
Corporate Executive Board Co.                                 4,200           281,148
- --------------------------------------------------------------------------------------
Dun & Bradstreet Corp. 1                                      6,900           411,585
- --------------------------------------------------------------------------------------
Equifax, Inc.                                                17,200           483,320
- --------------------------------------------------------------------------------------
Gevity HR, Inc.                                               2,500            51,400
- --------------------------------------------------------------------------------------
ITT Educational Services, Inc. 1                              7,400           351,870
- --------------------------------------------------------------------------------------
Miller (Herman), Inc.                                         4,900           135,387
- --------------------------------------------------------------------------------------
Pitney Bowes, Inc.                                            8,500           393,380
- --------------------------------------------------------------------------------------
Republic Services, Inc.                                      15,800           529,932
- --------------------------------------------------------------------------------------
Resources Connection, Inc. 1                                  2,400           130,344
- --------------------------------------------------------------------------------------
Robert Half International, Inc.                              39,100         1,150,713
- --------------------------------------------------------------------------------------
Sotheby's Holdings, Inc., Cl. A 1                             8,000           145,280
- --------------------------------------------------------------------------------------
Waste Management, Inc.                                       39,700         1,188,618
                                                                      ----------------
                                                                           10,440,581

- --------------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--0.0%
Shaw Group, Inc. (The) 1                                     13,200           235,620
- --------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.4%
American Power Conversion Corp.                              24,900           532,860
- --------------------------------------------------------------------------------------
Cooper Industries Ltd., Cl. A                                 9,400           638,166
- --------------------------------------------------------------------------------------
Emerson Electric Co.                                         44,800         3,140,480
- --------------------------------------------------------------------------------------
Hubbell, Inc., Cl. B                                          1,500            78,450



                      13 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

ELECTRICAL EQUIPMENT Continued
Molex, Inc., Cl. A                                           20,750   $       552,988
- --------------------------------------------------------------------------------------
Rockwell Automation, Inc.                                    19,100           946,405
                                                                      ----------------
                                                                            5,889,349

- --------------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--5.1%
3M Co.                                                      150,800        12,376,156
- --------------------------------------------------------------------------------------
General Electric Co.                                      1,855,200        67,714,800
- --------------------------------------------------------------------------------------
Textron, Inc.                                                 9,900           730,620
- --------------------------------------------------------------------------------------
Tyco International Ltd.                                      23,000           822,020
                                                                      ----------------
                                                                           81,643,596

- --------------------------------------------------------------------------------------
MACHINERY--1.2%
Briggs & Stratton Corp.                                       1,600            66,528
- --------------------------------------------------------------------------------------
Caterpillar, Inc.                                            33,100         3,227,581
- --------------------------------------------------------------------------------------
Cummins, Inc.                                                12,500         1,047,375
- --------------------------------------------------------------------------------------
Danaher Corp.                                                14,100           809,481
- --------------------------------------------------------------------------------------
Deere & Co.                                                  36,000         2,678,400
- --------------------------------------------------------------------------------------
Dover Corp.                                                  13,400           561,996
- --------------------------------------------------------------------------------------
Illinois Tool Works, Inc.                                    35,400         3,280,872
- --------------------------------------------------------------------------------------
Ingersoll-Rand Co., Cl. A                                    25,800         2,071,740
- --------------------------------------------------------------------------------------
Mueller Industries, Inc.                                      6,000           193,200
- --------------------------------------------------------------------------------------
Navistar International Corp. 1                               18,200           800,436
- --------------------------------------------------------------------------------------
Paccar, Inc.                                                 23,050         1,855,064
- --------------------------------------------------------------------------------------
Pall Corp.                                                   16,900           489,255
- --------------------------------------------------------------------------------------
Parker-Hannifin Corp.                                        10,300           780,122
- --------------------------------------------------------------------------------------
SPX Corp.                                                    33,500         1,342,010
- --------------------------------------------------------------------------------------
Terex Corp. 1                                                 3,000           142,950
- --------------------------------------------------------------------------------------
Toro Co. (The)                                                5,600           455,560
- --------------------------------------------------------------------------------------
Wabash National Corp. 1                                       9,100           245,063
                                                                      ----------------
                                                                           20,047,633

- --------------------------------------------------------------------------------------
ROAD & RAIL--0.2%
Burlington Northern Santa Fe Corp.                            8,800           416,328
- --------------------------------------------------------------------------------------
CNF Transportation, Inc.                                     18,000           901,800
- --------------------------------------------------------------------------------------
CSX Corp.                                                     5,900           236,472
- --------------------------------------------------------------------------------------
Genesee & Wyoming, Inc., Cl. A 1                              1,100            30,943
- --------------------------------------------------------------------------------------
Hunt (J.B.) Transport Services, Inc.                         19,600           879,060
- --------------------------------------------------------------------------------------
Norfolk Southern Corp.                                        8,300           300,377
- --------------------------------------------------------------------------------------
Ryder Systems, Inc.                                          17,000           812,090
- --------------------------------------------------------------------------------------
Swift Transportation Co., Inc. 1                             23,400           502,632
                                                                      ----------------
                                                                            4,079,702

- --------------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--0.1%
W.W. Grainger, Inc.                                          13,000           866,060


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

INFORMATION TECHNOLOGY--18.9%
- --------------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--3.4%
ADTRAN, Inc.                                                 24,000   $       459,360
- --------------------------------------------------------------------------------------
Avaya, Inc. 1                                                98,300         1,690,760
- --------------------------------------------------------------------------------------
Brocade Communications
Systems, Inc. 1                                              70,700           540,148
- --------------------------------------------------------------------------------------
Ciena Corp. 1                                               147,100           491,314
- --------------------------------------------------------------------------------------
Cisco Systems, Inc. 1                                     1,260,300        24,323,790
- --------------------------------------------------------------------------------------
CommScope, Inc. 1                                             5,000            94,500
- --------------------------------------------------------------------------------------
Comverse Technology, Inc. 1                                  60,000         1,467,000
- --------------------------------------------------------------------------------------
Ditech Communications Corp. 1                                 3,300            49,335
- --------------------------------------------------------------------------------------
Extreme Networks, Inc. 1                                     26,900           176,195
- --------------------------------------------------------------------------------------
Harris Corp.                                                  6,100           376,919
- --------------------------------------------------------------------------------------
Juniper Networks, Inc. 1                                    144,300         3,923,517
- --------------------------------------------------------------------------------------
Lucent Technologies, Inc. 1                                 649,300         2,441,368
- --------------------------------------------------------------------------------------
Motorola, Inc.                                              258,700         4,449,640
- --------------------------------------------------------------------------------------
Polycom, Inc. 1                                              12,200           284,504
- --------------------------------------------------------------------------------------
QUALCOMM, Inc.                                              292,600        12,406,240
- --------------------------------------------------------------------------------------
Scientific-Atlanta, Inc.                                     38,000         1,254,380
- --------------------------------------------------------------------------------------
Sonus Networks, Inc. 1                                       20,100           115,173
- --------------------------------------------------------------------------------------
Tellabs, Inc. 1                                              32,400           278,316
                                                                      ----------------
                                                                           54,822,459

- --------------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--4.8%
Apple Computer, Inc. 1                                       27,400         1,764,560
- --------------------------------------------------------------------------------------
Avid Technology, Inc. 1                                       3,500           216,125
- --------------------------------------------------------------------------------------
Dell, Inc. 1                                                523,200        22,047,648
- --------------------------------------------------------------------------------------
Electronics for Imaging, Inc. 1                               6,300           109,683
- --------------------------------------------------------------------------------------
Hewlett-Packard Co.                                         741,000        15,538,770
- --------------------------------------------------------------------------------------
International Business
Machines Corp.                                              295,500        29,130,390
- --------------------------------------------------------------------------------------
Lexmark International, Inc., Cl. A 1                         32,600         2,771,000
- --------------------------------------------------------------------------------------
Maxtor Corp. 1                                               71,600           379,480
- --------------------------------------------------------------------------------------
NCR Corp. 1                                                  17,800         1,232,294
- --------------------------------------------------------------------------------------
Storage Technology Corp. 1                                   30,600           967,266
- --------------------------------------------------------------------------------------
Sun Microsystems, Inc. 1                                    656,900         3,534,122
- --------------------------------------------------------------------------------------
Western Digital Corp. 1                                      33,500           363,140
                                                                      ----------------
                                                                           78,054,478

- --------------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--0.6%
Agilent Technologies, Inc. 1                                100,000         2,410,000
- --------------------------------------------------------------------------------------
Amphenol Corp., Cl. A 1                                      31,500         1,157,310
- --------------------------------------------------------------------------------------
Arrow Electronics, Inc. 1                                     1,600            38,880
- --------------------------------------------------------------------------------------
CDW Corp.                                                     9,200           610,420
- --------------------------------------------------------------------------------------
Cognex Corp.                                                  5,400           150,660
- --------------------------------------------------------------------------------------
Diebold, Inc.                                                   900            50,157
- --------------------------------------------------------------------------------------
Dionex Corp. 1                                                1,100            62,337



                      14 | OPPENHEIMER MAIN STREET FUND/VA




                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

ELECTRONIC EQUIPMENT & INSTRUMENTS Continued
Electro Scientific Industries, Inc. 1                           800   $        15,808
- --------------------------------------------------------------------------------------
Ingram Micro, Inc., Cl. A 1                                  37,600           782,080
- --------------------------------------------------------------------------------------
Jabil Circuit, Inc. 1                                        39,500         1,010,410
- --------------------------------------------------------------------------------------
Littlefuse, Inc. 1                                            3,000           102,480
- --------------------------------------------------------------------------------------
Molex, Inc.                                                  23,600           708,000
- --------------------------------------------------------------------------------------
MTS Systems Corp.                                             1,100            37,191
- --------------------------------------------------------------------------------------
Sanmina-SCI Corp. 1                                         104,700           886,809
- --------------------------------------------------------------------------------------
Symbol Technologies, Inc.                                     5,500            95,150
- --------------------------------------------------------------------------------------
Tech Data Corp. 1                                            19,700           894,380
- --------------------------------------------------------------------------------------
Trimble Navigation Ltd. 1                                     6,800           224,672
- --------------------------------------------------------------------------------------
UNOVA, Inc. 1                                                 3,400            85,986
                                                                      ----------------
                                                                            9,322,730

- --------------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.6%
DoubleClick, Inc. 1                                          25,200           196,056
- --------------------------------------------------------------------------------------'
EarthLink, Inc. 1                                            50,500           581,760
- --------------------------------------------------------------------------------------
InfoSpace, Inc. 1                                            13,600           646,680
- --------------------------------------------------------------------------------------
Internet Security Systems, Inc. 1                            22,000           511,500
- --------------------------------------------------------------------------------------
MicroStrategy, Inc., Cl. A 1                                  4,500           271,125
- --------------------------------------------------------------------------------------
Openwave Systems, Inc. 1                                     10,700           165,422
- --------------------------------------------------------------------------------------
United Online, Inc. 1                                        40,100           462,353
- --------------------------------------------------------------------------------------
ValueClick, Inc. 1                                           21,400           285,262
- --------------------------------------------------------------------------------------
VeriSign, Inc. 1                                             16,300           546,376
- --------------------------------------------------------------------------------------
WebEx Communications, Inc. 1                                  3,700            87,986
- --------------------------------------------------------------------------------------
Websense, Inc. 1                                             11,300           573,136
- --------------------------------------------------------------------------------------
Yahoo!, Inc. 1                                              141,800         5,343,024
                                                                      ----------------
                                                                            9,670,680

- --------------------------------------------------------------------------------------
IT SERVICES--0.9%
Acxiom Corp.                                                 24,600           646,980
- --------------------------------------------------------------------------------------
Affiliated Computer Services,
Inc., Cl. A 1                                                30,600         1,841,814
- --------------------------------------------------------------------------------------
Automatic Data Processing, Inc.                              88,300         3,916,105
- --------------------------------------------------------------------------------------
BISYS Group, Inc. (The) 1                                     1,500            24,675
- --------------------------------------------------------------------------------------
CheckFree Corp. 1                                            34,200         1,302,336
- --------------------------------------------------------------------------------------
Computer Sciences Corp. 1                                    40,500         2,282,985
- --------------------------------------------------------------------------------------
Convergys Corp. 1                                            26,700           400,233
- --------------------------------------------------------------------------------------
CSG Systems International, Inc. 1                             1,300            24,310
- --------------------------------------------------------------------------------------
Electronic Data Systems Corp.                                79,000         1,824,900
- --------------------------------------------------------------------------------------
First Data Corp.                                             50,200         2,135,508
- --------------------------------------------------------------------------------------
Sabre Holdings Corp.                                         41,200           912,992
                                                                      ----------------
                                                                           15,312,838

- --------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--3.8%
Advanced Micro Devices, Inc. 1                               82,900         1,825,458
- --------------------------------------------------------------------------------------
Agere Systems, Inc., Cl. A 1                                160,300           219,611
- --------------------------------------------------------------------------------------
Altera Corp. 1                                               62,200         1,287,540


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT Continued
Analog Devices, Inc.                                         88,800   $     3,278,496
- --------------------------------------------------------------------------------------
Applied Materials, Inc. 1                                   255,100         4,362,210
- --------------------------------------------------------------------------------------
Applied Micro Circuits Corp. 1                               80,800           340,168
- --------------------------------------------------------------------------------------
Atmel Corp. 1                                               286,900         1,124,648
- --------------------------------------------------------------------------------------
Broadcom Corp., Cl. A  1                                      7,500           242,100
- --------------------------------------------------------------------------------------
Cabot Microelectronics Corp. 1                               13,700           548,685
- --------------------------------------------------------------------------------------
Cree, Inc. 1                                                 35,300         1,414,824
- --------------------------------------------------------------------------------------
Cymer, Inc. 1                                                 4,900           144,746
- --------------------------------------------------------------------------------------
Freescale Semiconductor, Inc., Cl. A  1                      35,800           637,956
- --------------------------------------------------------------------------------------
Freescale Semiconductor, Inc., Cl. B  1                      28,343           520,377
- --------------------------------------------------------------------------------------
Integrated Circuit Systems, Inc. 1                            1,100            23,012
- --------------------------------------------------------------------------------------
Integrated Device Technology, Inc. 1                         25,600           295,936
- --------------------------------------------------------------------------------------
Intel Corp.                                               1,132,100        26,479,819
- --------------------------------------------------------------------------------------
International Rectifier Corp. 1                                 500            22,285
- --------------------------------------------------------------------------------------
Intersil Corp., Cl. A                                        54,700           915,678
- --------------------------------------------------------------------------------------
KLA-Tencor Corp. 1                                           19,800           922,284
- --------------------------------------------------------------------------------------
Lam Research Corp. 1                                         34,700         1,003,177
- --------------------------------------------------------------------------------------
Linear Technology Corp.                                      83,800         3,248,088
- --------------------------------------------------------------------------------------
LSI Logic Corp. 1                                            83,400           457,032
- --------------------------------------------------------------------------------------
Maxim Integrated Products, Inc.                              37,100         1,572,669
- --------------------------------------------------------------------------------------
Micrel, Inc. 1                                               15,100           166,402
- --------------------------------------------------------------------------------------
Microchip Technology, Inc.                                   34,100           909,106
- --------------------------------------------------------------------------------------
Micron Technology, Inc. 1                                   150,700         1,861,145
- --------------------------------------------------------------------------------------
National Semiconductor Corp. 1                               95,600         1,716,020
- --------------------------------------------------------------------------------------
PMC-Sierra, Inc. 1                                            3,200            36,000
- --------------------------------------------------------------------------------------
Rambus, Inc. 1                                               19,100           439,300
- --------------------------------------------------------------------------------------
Semtech Corp. 1                                              18,600           406,782
- --------------------------------------------------------------------------------------
Silicon Image, Inc. 1                                        15,100           248,546
- --------------------------------------------------------------------------------------
Teradyne, Inc. 1                                             12,800           218,496
- --------------------------------------------------------------------------------------
Texas Instruments, Inc.                                     165,900         4,084,458
- --------------------------------------------------------------------------------------
Xilinx, Inc.                                                 15,400           456,610
                                                                      ----------------
                                                                           61,429,664

- --------------------------------------------------------------------------------------
SOFTWARE--4.8%
Activision, Inc. 1                                           29,000           585,220
- --------------------------------------------------------------------------------------
Adobe Systems, Inc.                                          19,800         1,242,252
- --------------------------------------------------------------------------------------
Amdocs Ltd. 1                                                22,200           582,750
- --------------------------------------------------------------------------------------
Autodesk, Inc.                                               40,400         1,533,180
- --------------------------------------------------------------------------------------
BEA Systems, Inc. 1                                          51,500           456,290
- --------------------------------------------------------------------------------------
BMC Software, Inc. 1                                         48,200           896,520
- --------------------------------------------------------------------------------------
Computer Associates
International, Inc.                                          38,900         1,208,234
- --------------------------------------------------------------------------------------
Compuware Corp. 1                                             6,500            42,055
- --------------------------------------------------------------------------------------
Electronic Arts, Inc. 1                                      32,600         2,010,768
- --------------------------------------------------------------------------------------
FactSet Research Systems, Inc.                                4,300           251,292
- --------------------------------------------------------------------------------------
Fair Isaac Corp.                                             12,900           473,172



                      15 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

SOFTWARE Continued
FileNet Corp. 1                                               8,700   $       224,112
- --------------------------------------------------------------------------------------
Macrovision Corp. 1                                           7,600           195,472
- --------------------------------------------------------------------------------------
McAfee, Inc. 1                                               39,300         1,136,949
- --------------------------------------------------------------------------------------
MICROS Systems, Inc. 1                                        1,300           101,478
- --------------------------------------------------------------------------------------
Microsoft Corp.                                           1,803,700        48,176,827
- --------------------------------------------------------------------------------------
Oracle Corp. 1                                              858,100        11,773,132
- --------------------------------------------------------------------------------------
Quest Software, Inc. 1                                        2,400            38,280
- --------------------------------------------------------------------------------------
RSA Security, Inc. 1                                         27,000           541,620
- --------------------------------------------------------------------------------------
Siebel Systems, Inc. 1                                       61,700           647,850
- --------------------------------------------------------------------------------------
Sybase, Inc. 1                                               57,600         1,149,120
- --------------------------------------------------------------------------------------
Synopsys, Inc. 1                                             30,900           606,258
- --------------------------------------------------------------------------------------
Take-Two Interactive Software, Inc. 1                        14,700           511,413
- --------------------------------------------------------------------------------------
THQ, Inc. 1                                                  22,500           516,150
- --------------------------------------------------------------------------------------
TIBCO Software, Inc. 1                                       75,800         1,011,172
- --------------------------------------------------------------------------------------
Veritas Software Corp. 1                                     36,800         1,050,640
                                                                      ----------------
                                                                           76,962,206

- --------------------------------------------------------------------------------------
MATERIALS--2.6%
- --------------------------------------------------------------------------------------
CHEMICALS--1.1%
Cabot Corp.                                                   5,400           208,872
- --------------------------------------------------------------------------------------
Dow Chemical Co.                                             38,200         1,891,282
- --------------------------------------------------------------------------------------
E.I. DuPont de Nemours & Co.                                107,300         5,263,065
- --------------------------------------------------------------------------------------
Eastman Chemical Co.                                         14,500           837,085
- --------------------------------------------------------------------------------------
Engelhard Corp.                                              13,400           410,978
- --------------------------------------------------------------------------------------
FMC Corp. 1                                                   7,300           352,590
- --------------------------------------------------------------------------------------
Georgia Gulf Corp.                                           17,600           876,480
- --------------------------------------------------------------------------------------
Lyondell Chemical Co.                                        30,300           876,276
- --------------------------------------------------------------------------------------
Monsanto Co.                                                 77,500         4,305,125
- --------------------------------------------------------------------------------------
OM Group, Inc. 1                                             12,700           411,734
- --------------------------------------------------------------------------------------
PPG Industries, Inc.                                         12,000           817,920
- --------------------------------------------------------------------------------------
Praxair, Inc.                                                 9,100           401,765
- --------------------------------------------------------------------------------------
Rohm & Haas Co.                                              18,300           809,409
- --------------------------------------------------------------------------------------
Scotts Co. (The), Cl. A 1                                     3,800           279,376
- --------------------------------------------------------------------------------------
W.R. Grace & Co. 1                                           25,000           340,250
                                                                      ----------------
                                                                           18,082,207

- --------------------------------------------------------------------------------------
CONSTRUCTION MATERIALS--0.1%
Eagle Materials, Inc., Cl. B                                  7,543           635,875
- --------------------------------------------------------------------------------------
Florida Rock Industries, Inc.                                 1,900           113,107
- --------------------------------------------------------------------------------------
Texas Industries, Inc.                                        3,400           212,092
- --------------------------------------------------------------------------------------
Vulcan Materials Co.                                          8,000           436,880
                                                                      ----------------
                                                                            1,397,954

- --------------------------------------------------------------------------------------
CONTAINERS & PACKAGING--0.1%
Ball Corp.                                                    3,800           167,124
- --------------------------------------------------------------------------------------
Bemis Co., Inc.                                               2,300            66,907


                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

CONTAINERS & PACKAGING Continued
Crown Holdings, Inc. 1                                       25,100   $       344,874
- --------------------------------------------------------------------------------------
Owens-Illinois, Inc. 1                                       37,000           838,050
- --------------------------------------------------------------------------------------
Smurfit-Stone Container Corp.                                14,300           267,124
                                                                      ----------------
                                                                            1,684,079

- --------------------------------------------------------------------------------------
METALS & MINING--0.8%
AK Steel Holding Corp. 1                                     31,300           452,911
- --------------------------------------------------------------------------------------
Alcoa, Inc.                                                 140,800         4,423,936
- --------------------------------------------------------------------------------------
Carpenter Technology Corp.                                    3,900           227,994
- --------------------------------------------------------------------------------------
Cleveland-Cliffs, Inc.                                        5,500           571,230
- --------------------------------------------------------------------------------------
Inco Ltd. 1                                                   5,600           205,968
- --------------------------------------------------------------------------------------
Massey Energy Co.                                            24,800           866,760
- --------------------------------------------------------------------------------------
Nucor Corp.                                                  17,600           921,184
- --------------------------------------------------------------------------------------
Phelps Dodge Corp.                                           26,400         2,611,488
- --------------------------------------------------------------------------------------
Schnitzer Steel Industries, Inc.                              4,700           159,471
- --------------------------------------------------------------------------------------
Southern Peru Copper Corp.                                    5,800           273,818
- --------------------------------------------------------------------------------------
Steel Dynamics, Inc.                                          6,600           250,008
- --------------------------------------------------------------------------------------
United States Steel Corp.                                    33,000         1,691,250
- --------------------------------------------------------------------------------------
Worthington Industries, Inc.                                 14,800           289,784
                                                                      ----------------
                                                                           12,945,802

- --------------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--0.5%
Georgia-Pacific Corp.                                        76,600         2,870,968
- --------------------------------------------------------------------------------------
International Paper Co.                                      13,900           583,800
- --------------------------------------------------------------------------------------
Louisiana-Pacific Corp.                                      52,500         1,403,850
- --------------------------------------------------------------------------------------
MeadWestvaco Corp.                                           53,100         1,799,559
- --------------------------------------------------------------------------------------
Neenah Paper, Inc. 1                                          2,036            66,374
- --------------------------------------------------------------------------------------
Potlatch Corp.                                               10,500           531,090
- --------------------------------------------------------------------------------------
Weyerhaeuser Co.                                              1,400            94,108
                                                                      ----------------
                                                                            7,349,749

- --------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--3.8%
- --------------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--3.4%
Alltel Corp.                                                 20,100        1,181,076
- -------------------------------------------------------------------------------------
BellSouth Corp.                                             326,400        9,070,656
- -------------------------------------------------------------------------------------
CenturyTel, Inc.                                             31,000        1,099,570
- -------------------------------------------------------------------------------------
Citizens Communications Co.                                 115,400        1,591,366
- -------------------------------------------------------------------------------------
Qwest Communications
International, Inc. 1                                        25,200          111,888
- -------------------------------------------------------------------------------------
SBC Communications, Inc.                                    775,500       19,984,635
- -------------------------------------------------------------------------------------
Sprint Corp.                                                 44,700        1,110,795
- -------------------------------------------------------------------------------------
Verizon Communications, Inc.                                500,456       20,273,473
                                                                      ---------------
                                                                          54,423,459

- -------------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--0.4%
Alamosa Holdings, Inc. 1                                     23,700          295,539
- -------------------------------------------------------------------------------------
AT&T Corp.                                                   46,400          884,384



                      16 | OPPENHEIMER MAIN STREET FUND/VA




                                                                                VALUE
                                                             SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------------

WIRELESS TELECOMMUNICATION SERVICES Continued
Nextel Communications, Inc., Cl. A 1                        185,700   $     5,571,000
- --------------------------------------------------------------------------------------
Telephone & Data Systems, Inc.                                3,500           269,325
                                                                      ----------------
                                                                            7,020,248

- --------------------------------------------------------------------------------------
UTILITIES--0.4%
- --------------------------------------------------------------------------------------
ELECTRIC UTILITIES--0.4%
American Electric Power Co., Inc.                            59,300         2,036,362
- --------------------------------------------------------------------------------------
Calpine Corp. 1                                              69,033           271,990
- --------------------------------------------------------------------------------------
CMS Energy Corp. 1                                           29,900           312,455
- --------------------------------------------------------------------------------------
Constellation Energy Group, Inc.                                200             8,742
- --------------------------------------------------------------------------------------
Edison International, Inc.                                   27,000           864,810
- --------------------------------------------------------------------------------------
Exelon Corp.                                                 18,448           813,003
- --------------------------------------------------------------------------------------
FPL Group, Inc.                                              10,500           784,875
- --------------------------------------------------------------------------------------
PG&E Corp. 1                                                 23,500           782,080
- --------------------------------------------------------------------------------------
Progress Energy, Inc. 1,2                                    32,000             4,320
- --------------------------------------------------------------------------------------
Wisconsin Energy Corp.                                        3,800           128,098
                                                                      ----------------
                                                                            6,006,735

- --------------------------------------------------------------------------------------
GAS UTILITIES--0.0%
ONEOK, Inc.                                                   6,500           184,728
                                                                      ----------------
Total Common Stocks
(Cost $1,371,019,607)                                                   1,592,279,234

- --------------------------------------------------------------------------------------
PREFERRED STOCKS--0.0%
- --------------------------------------------------------------------------------------
Wachovia Corp., Dividend
Equalization Preferred Shares 1,2
(Cost $0)                                                     6,000                 6


                                                              UNITS
- --------------------------------------------------------------------------------------

RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- --------------------------------------------------------------------------------------
Dime Bancorp, Inc. Wts.,
Exp. 1/2/10 1                                                31,900             6,061
- --------------------------------------------------------------------------------------
Lucent Technologies, Inc. Wts.,
Exp. 12/10/07 1                                               4,837             7,642
                                                                      ----------------
Total Rights, Warrants and
Certificates (Cost $0)                                                         13,703


                                                          PRINCIPAL
                                                             AMOUNT
- --------------------------------------------------------------------------------------

JOINT REPURCHASE AGREEMENTS--1.1%
- --------------------------------------------------------------------------------------
Undivided interest of 1.24% in joint
repurchase agreement (Principal Amount/
Value $1,443,703,000, with a maturity value
of $1,443,962,867) with UBS Warburg LLC,
2.16%, dated 12/31/04, to be repurchased
at $17,894,220 on 1/3/05, collateralized
by Federal National Mortgage Assn.,
5%--6%, 4/1/34--10/1/34, with
a value of $1,474,609,071
(Cost $17,891,000)                                     $ 17,891,000        17,891,000


                                                          PRINCIPAL             VALUE
                                                             AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------------

JOINT REPURCHASE AGREEMENTS Continued
- --------------------------------------------------------------------------------------
Total Investments, at Value
(excluding Investments Purchased
with Cash Collateral from Securities
Loaned) (Cost $1,388,910,607)                                         $ 1,610,183,943

- --------------------------------------------------------------------------------------
INVESTMENTS PURCHASED WITH CASH COLLATERAL
FROM SECURITIES LOANED--5.2%
- --------------------------------------------------------------------------------------
ASSET-BACKED FLOATING SECURITY--0.1%
Money Market Trust, Series A-2,
2.478% Nts., 1/18/05 3                                    1,000,000         1,000,000
- --------------------------------------------------------------------------------------
FUNDING AGREEMENT/GIC--0.1%
Allstate Life Insurance Co.,
2.47%, 1/3/05 3                                           1,000,000         1,000,000
- --------------------------------------------------------------------------------------
MASTER FLOATING NOTES--0.2%
Bear Stearns, 2.493%, 1/3/05 3                            3,500,000         3,500,000
- --------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--4.7%
Undivided interest of 2.75% in joint repurchase
agreement (Principal Amount/Value $2,800,000,000,
with a maturity value of $2,800,550,669) with Nomura
Securities, 2.36%, dated 12/31/04, to be repurchased
at $76,906,710 on 1/3/05, collateralized by U.S.
Government Mortgage Agencies, 2.58%-7.50%,
1/15/08-10/15/44, with a value
of $2,908,566,289 3                                      76,891,588        76,891,588
- --------------------------------------------------------------------------------------
YANKEE FLOATING CERTIFICATE OF DEPOSIT--0.1%
Natexis Banque, NY, 2.193%
Deposit Nts., 1/3/05 3                                    1,999,200         1,999,200
                                                                      ----------------
Total Investments Purchased with
Cash Collateral from Securities Loaned
(Cost $84,390,788)                                                         84,390,788

- --------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $1,473,301,395)                                         105.1%    1,694,574,731
- --------------------------------------------------------------------------------------
LIABILITIES IN EXCESS
OF OTHER ASSETS                                                (5.1)      (82,781,880)
                                                       -------------------------------
NET ASSETS                                                    100.0%  $ 1,611,792,851
                                                       ===============================


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. Illiquid security. The aggregate value of illiquid securities as of December
31, 2004 was $4,326, which represents less than 0.05% of the Fund's net assets.
See Note 6 of Notes to Financial Statements.

3. The security has been segregated to satisfy the forward commitment to return
the cash collateral received in securities lending transactions upon the
borrower's return of the securities loaned. See Note 7 of Notes to Financial
Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      17 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- --------------------------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------------------------

Investments, at value (including securities loaned of $82,656,230)
(cost $1,473,301,395)--see accompanying statement of investments                  $ 1,694,574,731
- --------------------------------------------------------------------------------------------------
Cash                                                                                      277,531
- --------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold                                                                       20,004,857
Interest and dividends                                                                  2,057,773
Shares of beneficial interest sold                                                      1,273,039
Other                                                                                      14,112
                                                                                  ----------------
Total assets                                                                        1,718,202,043

- --------------------------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------------------------
Return of collateral for securities loaned                                             84,390,788
- --------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased                                                                  20,683,436
Shares of beneficial interest redeemed                                                    985,903
Distribution and service plan fees                                                        236,965
Shareholder communications                                                                 45,245
Trustees' compensation                                                                     21,290
Transfer and shareholder servicing agent fees                                               1,748
Other                                                                                      43,817
                                                                                  ----------------
Total liabilities                                                                     106,409,192

- --------------------------------------------------------------------------------------------------
NET ASSETS                                                                        $ 1,611,792,851
                                                                                  ================

- --------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- --------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                        $        77,460
- --------------------------------------------------------------------------------------------------
Additional paid-in capital                                                          1,596,214,582
- --------------------------------------------------------------------------------------------------
Accumulated net investment income                                                      20,719,203
- --------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions       (226,491,822)
- --------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and
liabilities denominated in foreign currencies                                         221,273,428
                                                                                  ----------------
NET ASSETS                                                                        $ 1,611,792,851
                                                                                  ================

- --------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- --------------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based
on net assets of $1,238,947,749 and 59,452,782 shares of beneficial interest
outstanding)                                                                      $         20.84
- --------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share (based
on net assets of $372,845,102 and 18,007,790 shares of beneficial interest
outstanding)                                                                      $         20.70


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      18 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------



- ----------------------------------------------------------------------------------------
INVESTMENT INCOME
- ----------------------------------------------------------------------------------------

Dividends (net of foreign withholding taxes of $14,482)                   $  30,469,815
- ----------------------------------------------------------------------------------------
Interest                                                                        345,218
- ----------------------------------------------------------------------------------------
Portfolio lending fees                                                          146,383
                                                                          --------------
Total investment income                                                      30,961,416

- ----------------------------------------------------------------------------------------
EXPENSES
- ----------------------------------------------------------------------------------------
Management fees                                                               9,708,725
- ----------------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                              655,239
- ----------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                               10,185
Service shares                                                                   10,053
- ----------------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                               61,504
Service shares                                                                   13,518
- ----------------------------------------------------------------------------------------
Trustees' compensation                                                           29,093
- ----------------------------------------------------------------------------------------
Custodian fees and expenses                                                      25,878
- ----------------------------------------------------------------------------------------
Other                                                                            96,421
                                                                          --------------
Total expenses                                                               10,610,616
Less reduction to custodian expenses                                             (6,829)
                                                                          --------------
Net expenses                                                                 10,603,787

- ----------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                        20,357,629

- ----------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- ----------------------------------------------------------------------------------------
Net realized gain on:
Investments                                                                 110,334,595
Foreign currency transactions                                                   448,102
Net increase from payment by affiliate                                          416,623
                                                                          --------------
Net realized gain                                                           111,199,320
- -----------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                                   4,876,244
Translation of assets and liabilities denominated in foreign currencies        (258,242)
                                                                          --------------
Net change in unrealized appreciation                                         4,618,002

- ----------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                      $ 136,174,951
                                                                          ==============


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      19 | OPPENHEIMER MAIN STREET FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                2004              2003
- --------------------------------------------------------------------------------------------------------------

OPERATIONS
- --------------------------------------------------------------------------------------------------------------
Net investment income                                                       $    20,357,629   $    11,837,805
- --------------------------------------------------------------------------------------------------------------
Net realized gain (loss)                                                        111,199,320       (28,749,982)
- --------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                              4,618,002       288,279,862
                                                                            ----------------------------------
Net increase in net assets resulting from operations                            136,174,951       271,367,685

- --------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                              (10,373,133)       (9,176,729)
Service shares                                                                   (1,403,577)         (594,874)

- --------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- --------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest
transactions:
Non-Service shares                                                              (73,484,963)       88,259,594
Service shares                                                                  179,202,879        89,152,120

- --------------------------------------------------------------------------------------------------------------
NET ASSETS
- --------------------------------------------------------------------------------------------------------------
Total increase                                                                  230,116,157       439,007,796
- --------------------------------------------------------------------------------------------------------------
Beginning of period                                                           1,381,676,694       942,668,898
                                                                            ----------------------------------
End of period (including accumulated net investment income of $20,719,203
and $11,726,476, respectively)                                              $ 1,611,792,851   $ 1,381,676,694
                                                                            ==================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      20 | OPPENHEIMER MAIN STREET FUND/VA


FINIANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,              2004             2003          2002            2001            2000
- ------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $     19.20     $      15.32     $   18.99     $     21.26     $     24.63
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                     .27 1            .18           .16             .13             .10
Net realized and unrealized gain (loss)                  1.53             3.86         (3.70)          (2.29)          (2.14)
                                                  ----------------------------------------------------------------------------
Total from investment operations                         1.80             4.04         (3.54)          (2.16)          (2.04)
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                     (.16)            (.16)         (.13)           (.11)           (.09)
Distributions from net realized gain                       --               --            --              --           (1.24)
                                                  ----------------------------------------------------------------------------
Total dividends and/or distributions to
shareholders                                             (.16)            (.16)         (.13)           (.11)          (1.33)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $     20.84     $      19.20     $   15.32     $     18.99     $     21.26
                                                  ============================================================================

- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                       9.46%           26.72%       (18.80)%        (10.16)%         (8.78)%
- ------------------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 1,238,948     $  1,214,960     $ 890,740     $ 1,074,945     $ 1,009,823
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 1,216,081     $  1,003,396     $ 999,275     $ 1,028,913     $   809,662
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                    1.39%            1.10%         0.94%           0.73%           0.69%
Total expenses                                           0.67% 4          0.70% 4       0.69% 4         0.73% 4         0.73%
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                    82%             85%            98%             69%            63%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      21 | OPPENHEIMER MAIN STREET FUND/VA


FINIANCIAL HIGHLIGHTS  continued
- --------------------------------------------------------------------------------



SERVICE SHARES  YEAR ENDED DECEMBER 31,                2004          2003         2002         2001         2001 1
- ------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $   19.10     $   15.26     $  18.95     $  21.24     $  24.04
- ------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                   .25 2         .14          .13          .14          .02
Net realized and unrealized gain (loss)                1.49          3.85        (3.70)       (2.32)       (2.82)
                                                  ----------------------------------------------------------------
Total investment operations                            1.74          3.99        (3.57)       (2.18)       (2.80)
- ------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                   (.14)         (.15)        (.12)        (.11)          --
Distributions from net realized gain                     --            --           --           --           --
                                                  ----------------------------------------------------------------
Total dividends and/or distributions to
shareholders                                           (.14)         (.15)        (.12)        (.11)          --
- ------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $   20.70     $   19.10     $  15.26     $  18.95     $  21.24
                                                  ================================================================

- ------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                     9.15%        26.44%      (18.99)%     (10.27)%     (11.61)%
- ------------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 372,845     $ 166,717     $ 51,929     $ 21,545     $  1,698
- ------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 262,660     $  98,210     $ 34,604     $ 10,306     $    543
- ------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                  1.30%         0.83%        0.87%        0.66%        0.50%
Total expenses                                         0.92% 5       0.96% 5      0.84% 5      0.88% 5      0.88%
- ------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                  82%           85%          98%          69%          63%


1. For the period from July 13, 2000 (inception of offering) to December 31,
2000.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                      22 | OPPENHEIMER MAIN STREET FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Main Street Fund/VA (the Fund), is a separate series of Oppenheimer
Variable Account Funds (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
objective is to seek high total return (which includes growth in the value of
its shares as well as current income) from equity and debt securities. The
Trust's investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.


                      23 | OPPENHEIMER MAIN STREET FUND/VA


NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                               NET UNREALIZED
                                                                 APPRECIATION
                                                             BASED ON COST OF
                                                               SECURITIES AND
   UNDISTRIBUTED    UNDISTRIBUTED            ACCUMULATED    OTHER INVESTMENTS
   NET INVESTMENT       LONG-TERM                   LOSS   FOR FEDERAL INCOME
   INCOME                    GAIN   CARRYFORWARD 1,2,3,4         TAX PURPOSES
   --------------------------------------------------------------------------
   $ 20,674,279              $ --          $ 210,806,406        $ 205,708,485

1. As of December 31, 2004, the Fund had $208,785,635 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

              EXPIRING
              ------------------------
              2009       $  55,468,376
              2010         126,747,906
              2011          26,569,353
                         -------------
              Total      $ 208,785,635
                         =============

2. As of December 31, 2004, the Fund had $2,020,771 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

3. During the fiscal year ended December 31, 2004, the Fund utilized
$114,232,007 of capital loss carryforward to offset capital gains realized in
that fiscal year.

4. During the fiscal year ended December 31, 2003, the Fund did not utilize any
capital loss carryforward.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

    INCREASE TO          INCREASE TO
    ACCUMULATED      ACCUMULATED NET
    NET INVESTMENT     REALIZED LOSS
    INCOME            ON INVESTMENTS
    --------------------------------
    $ 411,808              $ 411,808


                      24 | OPPENHEIMER MAIN STREET FUND/VA


The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                      YEAR ENDED          YEAR ENDED
                               DECEMBER 31, 2004   DECEMBER 31, 2003
    ----------------------------------------------------------------
    Distributions paid from:
    Ordinary income                 $ 11,776,710         $ 9,771,603

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

         Federal tax cost of securities   $ 1,488,866,338
                                          ================

         Gross unrealized appreciation    $   229,577,710
         Gross unrealized depreciation        (23,869,225)
                                          ----------------
         Net unrealized appreciation      $   205,708,485
                                          ================

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.


                      25 | OPPENHEIMER MAIN STREET FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                                             YEAR ENDED DECEMBER 31, 2004   YEAR ENDED DECEMBER 31, 2003
                                                   SHARES          AMOUNT         SHARES          AMOUNT
- --------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                           11,955,294   $ 233,322,256     19,380,163   $ 327,567,787
Dividends and/or distributions reinvested         536,356      10,373,133        639,048       9,176,729
Redeemed                                      (16,312,427)   (317,180,352)   (14,871,791)   (248,484,922)
                                             ------------------------------------------------------------
Net increase (decrease)                        (3,820,777)  $ (73,484,963)     5,147,420   $  88,259,594
                                             ============================================================

- ---------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                           10,163,617   $ 196,313,963      5,793,833   $  97,063,016
Dividends and/or distributions reinvested          72,875       1,403,577         41,628         594,874
Redeemed                                         (955,303)    (18,514,661)      (511,472)     (8,505,770)
                                             ------------------------------------------------------------
Net increase                                    9,281,189   $ 179,202,879      5,323,989   $  89,152,120
                                             ============================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$1,305,020,608 and $1,185,897,130, respectively.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$20,156 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.


                      26 | OPPENHEIMER MAIN STREET FUND/VA


- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. Following a review of its use of brokerage
commissions for sales that is permitted under its investment advisory agreement,
the Fund's Manager terminated that practice in July 2003. Subsequently, the
Manager paid the Fund $416,623, an amount equivalent to certain of such
commissions incurred in prior years.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.

- --------------------------------------------------------------------------------
6. ILLIQUID SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 15% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities.

- --------------------------------------------------------------------------------
7. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had on loan securities valued at $82,656,230. Cash of $84,390,788 was
received as collateral for the loans, all of which was invested in approved
instruments.


                      27 | OPPENHEIMER MAIN STREET FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
8. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER HIGH INCOME FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer High Income Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer High Income Fund/VA as of December 31, 2004, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005



STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--0.3%
- --------------------------------------------------------------------------------
Consumer Credit Reference Index
Securities Program, Credit Card
Asset-Backed Certificates,
Series 2002-B, Cl. FX, 10.421%,
3/22/07 1                                          $     500,000   $     514,941
- --------------------------------------------------------------------------------
Norse CBO Ltd., 9.342% Sub. Bonds,
Series 1A, Cl. C2, 8/13/10 1                           1,500,000       1,470,000
                                                                   -------------
Total Asset-Backed Securities
(Cost $1,997,606)                                                      1,984,941

- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS--0.1%
- --------------------------------------------------------------------------------
First Chicago/Lennar Trust 1,
Commercial Mtg. Pass-Through
Certificates, Series 1997-CHL1, Cl. D,
7.863%, 4/29/39 1,2                                      300,000         305,672
- --------------------------------------------------------------------------------
Salomon Brothers Mortgage Securities
VII, Inc., Commercial Mtg. Pass-Through
Certificates, Series 1996-B, Cl. 1,
4.357%, 4/25/26 1,2                                       21,630          19,967
                                                                   -------------
Total Mortgage-Backed Obligations
(Cost $297,992)                                                          325,639

- --------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--77.9%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--23.0%
- --------------------------------------------------------------------------------
AUTO COMPONENTS--2.5%
ArvinMeritor, Inc., 8.75% Sr. Unsec
Unsub. Nts., 3/1/12                                    1,800,000       2,088,000
- --------------------------------------------------------------------------------
Collins & Aikman Floorcoverings, Inc.,
9.75% Sr. Sub. Nts., Series B, 2/15/10                   800,000         864,000
- --------------------------------------------------------------------------------
Cooper Standard Automotive Group:
7% Sr. Nts., 12/15/12 3                                  180,000         183,600
8.375% Sr. Sub. Nts., 12/15/14 3                         710,000         711,775
- --------------------------------------------------------------------------------
Dana Corp., 10.125% Nts., 3/15/10 1                      500,000         566,790
- --------------------------------------------------------------------------------
Dura Operating Corp.:
8.625% Sr. Nts., Series B, 4/15/12                     1,000,000       1,045,000
9% Sr. Sub. Nts., Series B, 5/1/09 [EUR]                 100,000         129,129
9% Sr. Unsec. Sub. Nts., Series D, 5/1/09                200,000         199,000
- --------------------------------------------------------------------------------
Eagle-Picher, Inc., 9.75% Sr. Nts., 9/1/13             1,200,000       1,206,000
- --------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. (The),
7.857% Nts., 8/15/11                                   1,500,000       1,530,000
- --------------------------------------------------------------------------------
Keystone Automotive Operations, Inc.,
9.75% Sr. Unsec. Sub. Nts., 11/1/13                      200,000         215,000
- --------------------------------------------------------------------------------
Lear Corp., 8.11% Sr. Unsec. Nts.,
Series B, 5/15/09                                      1,300,000       1,475,767
- --------------------------------------------------------------------------------
Metaldyne Corp.:
10% Sr. Nts., 11/1/13 3                                  500,000         477,500
11% Sr. Sub. Nts., 6/15/12                               750,000         626,250
- --------------------------------------------------------------------------------
Stoneridge, Inc., 11.50% Sr. Nts., 5/1/12              1,200,000       1,401,000


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
AUTO COMPONENTS Continued
Tenneco Automotive, Inc.:
8.625% Sr. Sub. Nts., 11/15/14 3                   $   1,100,000   $   1,149,500
10.25% Sr. Sec. Nts., Series B, 7/15/13                  900,000       1,066,500
- --------------------------------------------------------------------------------
United Components, Inc., 9.375%
Sr. Sub. Nts., 6/15/13                                   400,000         436,000
- --------------------------------------------------------------------------------
Visteon Corp., 7% Sr. Unsec. Nts.,
3/10/14                                                  200,000         192,000
                                                                   -------------
                                                                      15,562,811

- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--5.9%
Apcoa, Inc., 9.25% Sr. Unsec. Sub. Nts.,
3/15/08                                                  940,000         925,900
- --------------------------------------------------------------------------------
Aztar Corp., 9% Sr. Unsec. Sub. Nts.,
8/15/11                                                  450,000         498,375
- --------------------------------------------------------------------------------
Boyd Gaming Corp., 8.75% Sr. Sub. Nts.,
4/15/12                                                  800,000         894,000
- --------------------------------------------------------------------------------
Capital Gaming International, Inc.,
11.50% Promissory Nts., 8/1/1995 1,4,5                     9,500              --
- --------------------------------------------------------------------------------
Carrols Corp., 9% Sr. Sub. Nts., 1/15/13 3               270,000         280,800
- --------------------------------------------------------------------------------
Domino's, Inc., 8.25% Sr. Unsec. Sub.
Nts., 7/1/11                                             875,000         960,313
- --------------------------------------------------------------------------------
Gaylord Entertainment Co., 8% Sr. Nts.,
11/15/13                                                 500,000         542,500
- --------------------------------------------------------------------------------
Hilton Hotels Corp.:
7.625% Nts., 12/1/12                                     500,000         585,602
7.625% Nts., 5/15/08                                     400,000         443,340
- --------------------------------------------------------------------------------
Hollywood Park, Inc., 9.25% Sr. Unsec.
Sub. Nts., Series B, 2/15/07                           1,000,000       1,022,500
- --------------------------------------------------------------------------------
Intrawest Corp., 7.50% Sr. Unsec. Nts.,
10/15/13                                                 917,000         980,044
- --------------------------------------------------------------------------------
Isle of Capri Casinos, Inc.:
7% Sr. Unsec. Sub. Nts., 3/1/14                          800,000         820,000
9% Sr. Sub. Nts., 3/15/12                                600,000         664,500
- --------------------------------------------------------------------------------
John Q. Hammons Hotels, Inc., 8.875%
Sr. Nts., Series B, 5/15/12                              900,000       1,021,500
- --------------------------------------------------------------------------------
La Quinta Properties, Inc., 7%
Sr. Sec. Nts., 8/15/12                                   500,000         531,250
- --------------------------------------------------------------------------------
Mandalay Resort Group, 10.25% Sr.
Unsec. Sub. Nts., Series B, 8/1/07                       800,000         908,000
- --------------------------------------------------------------------------------
MGM Mirage, Inc.:
5.875% Sr. Nts., 2/27/14                                 600,000         592,500
8.375% Sr. Unsec. Sub. Nts., 2/1/11                      900,000       1,019,250
9.75% Sr. Unsec. Sub. Nts., 6/1/07                       800,000         892,000
- --------------------------------------------------------------------------------
Mohegan Tribal Gaming Authority:
6.375% Sr. Sub. Nts., 7/15/09                            800,000         826,000
8% Sr. Sub. Nts., 4/1/12                                 700,000         763,000
- --------------------------------------------------------------------------------
NCL Corp., 10.625% Sr. Nts., 7/15/14 3                   600,000         603,000
- --------------------------------------------------------------------------------
Park Place Entertainment Corp.:
7.875% Sr. Sub. Nts., 3/15/10                          1,500,000       1,696,875
9.375% Sr. Unsec. Sub. Nts., 2/15/07                   1,500,000       1,657,500


            7 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE Continued
Penn National Gaming, Inc., 8.875%
Sr. Sub. Nts., 3/15/10                             $     600,000   $     657,750
- --------------------------------------------------------------------------------
Pinnacle Entertainment, Inc., 8.25%
Sr. Unsec. Sub. Nts., 3/15/12                          1,350,000       1,441,125
- --------------------------------------------------------------------------------
Royal Caribbean Cruises Ltd., 8.75%
Sr. Unsub. Nts., 2/2/11                                  600,000         711,750
- --------------------------------------------------------------------------------
Six Flags, Inc.:
8.875% Sr. Unsec. Nts., 2/1/10                           800,000         814,000
9.625% Sr. Nts., 6/1/14                                   57,000          57,570
9.75% Sr. Nts., 4/15/13                                1,000,000       1,020,000
- --------------------------------------------------------------------------------
Starwood Hotels & Resorts Worldwide,
Inc., 7.875% Sr. Nts., 5/1/12                          1,500,000       1,721,250
- --------------------------------------------------------------------------------
Station Casinos, Inc.:
6.50% Sr. Unsec. Sub. Nts., 2/1/14                     2,300,000       2,374,750
9.875% Sr. Unsec. Sub. Nts., 7/1/10                      600,000         634,500
- --------------------------------------------------------------------------------
Sun International Hotels Ltd., 8.875%
Sr. Unsec. Sub. Nts., 8/15/11                          1,000,000       1,097,500
- --------------------------------------------------------------------------------
Universal City Development Partners
Ltd., 11.75% Sr. Nts., 4/1/10                          1,000,000       1,186,250
- --------------------------------------------------------------------------------
Vail Resorts, Inc., 6.75% Sr. Sub. Nts.,
2/15/14                                                  900,000         920,250
- --------------------------------------------------------------------------------
Venetian Casino Resort LLC/Las Vegas
Sands, Inc., 11% Sec. Nts., 6/15/10                      850,000         974,313
- --------------------------------------------------------------------------------
Wynn Las Vegas LLC/Wynn Las Vegas
Capital Corp., 6.625% Nts., 12/1/14 3                  3,400,000       3,383,000
                                                                   -------------
                                                                      36,122,757

- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES--1.8%
Beazer Homes USA, Inc., 8.375%
Sr. Nts., 4/15/12                                        500,000         552,500
- --------------------------------------------------------------------------------
Blount, Inc., 8.875% Sr. Sub. Nts.,
8/1/12                                                   775,000         844,750
- --------------------------------------------------------------------------------
D.R. Horton, Inc., 9.75% Sr. Sub.
Nts., 9/15/10                                            300,000         364,500
- --------------------------------------------------------------------------------
K. Hovnanian Enterprises, Inc., 8.875%
Sr. Sub. Nts., 4/1/12                                    800,000         888,000
- --------------------------------------------------------------------------------
KB Home:
8.625% Sr. Sub. Nts., 12/15/08                           150,000         170,250
9.50% Sr. Unsec. Sub. Nts., 2/15/11                      350,000         386,750
- --------------------------------------------------------------------------------
Meritage Corp., 9.75% Sr. Unsec. Nts.,
6/1/11                                                 1,200,000       1,332,000
- --------------------------------------------------------------------------------
Norcraft Cos. LP, 9% Sr. Sub. Nts.,
11/1/11 1                                                300,000         325,500
- --------------------------------------------------------------------------------
Sealy Mattress Co., 8.25% Sr. Sub. Nts.,
6/15/14                                                1,400,000       1,491,000
- --------------------------------------------------------------------------------
Standard Pacific Corp., 9.25% Sr.
Sub. Nts., 4/15/12                                       700,000         815,500
- --------------------------------------------------------------------------------
Toll Corp., 8.25% Sr. Sub. Nts., 12/1/11                 500,000         555,000


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES Continued
WCI Communities, Inc.:
9.125% Sr. Sub. Nts., 5/1/12                       $     800,000   $     892,000
10.625% Sr. Unsec. Sub. Nts., 2/15/11                    600,000         669,000
- --------------------------------------------------------------------------------
William Lyon Homes, Inc., 10.75%
Sr. Nts., 4/1/13                                         800,000         903,000
- --------------------------------------------------------------------------------
Williams Scotsman, Inc., 9.875%
Sr. Unsec. Nts., 6/1/07                                1,000,000       1,005,000
                                                                   -------------
                                                                      11,194,750

- --------------------------------------------------------------------------------
MEDIA--10.6%
Adelphia Communications Corp.:
7.875% Sr. Unsec. Nts., 5/1/09 4,5                       360,000         336,600
8.125% Sr. Nts., Series B, 7/15/03 4,5                 1,000,000         945,000
8.375% Sr. Nts., Series B, 2/1/08 4,5                  1,000,000         947,500
10.875% Sr. Unsec. Nts., 10/1/10 4,5                   1,000,000         995,000
- --------------------------------------------------------------------------------
Allbritton Communications Co., 7.75%
Sr. Unsec. Sub. Nts., 12/15/12                           700,000         728,000
- --------------------------------------------------------------------------------
AMC Entertainment, Inc.:
8% Sr. Unsec. Sub. Nts., 3/1/14                        1,050,000       1,050,000
9.50% Sr. Unsec. Sub. Nts., 2/1/11                     1,192,000       1,238,190
- --------------------------------------------------------------------------------
American Media Operations, Inc.:
8.875% Sr. Unsec. Sub. Nts., 1/15/11                     900,000         961,875
10.25% Sr. Unsec. Sub. Nts., Series B,
5/1/09                                                   600,000         635,250
- --------------------------------------------------------------------------------
Block Communications, Inc., 9.25%
Sr. Sub. Nts., 4/15/09                                   600,000         657,000
- --------------------------------------------------------------------------------
Cablevision Systems New York Group,
8% Sr. Nts., 4/15/12 3                                   500,000         536,250
- --------------------------------------------------------------------------------
Carmike Cinemas, Inc., 7.50% Sr. Sub.
Nts., 2/15/14                                            850,000         874,438
- --------------------------------------------------------------------------------
CBD Media LLC/CBD Finance, Inc.,
8.625% Sr. Sub. Nts., 6/1/11                             200,000         212,500
- --------------------------------------------------------------------------------
Charter Communications Holdings II
LLC, 10.25% Sr. Unsec. Nts., 9/15/10                     700,000         745,500
- --------------------------------------------------------------------------------
Charter Communications Holdings
LLC/Charter Communications Holdings
Capital Corp.:
0%/11.75% Sr. Unsec.
Sub. Disc. Nts., 5/15/11 6                               475,000         351,500
8.375% Sr. Nts., Second Lien, 4/30/14 3                6,400,000       6,784,000
- --------------------------------------------------------------------------------
Cinemark USA, Inc., 9% Sr. Unsec. Sub.
Nts., 2/1/13                                             400,000         458,500
- --------------------------------------------------------------------------------
Cinemark, Inc., 0%/9.75% Sr. Unsec.
Disc. Nts., 3/15/14 6                                  1,800,000       1,368,000
- --------------------------------------------------------------------------------
Corus Entertainment, Inc., 8.75% Sr.
Sub. Nts., 3/1/12                                        800,000         882,000
- --------------------------------------------------------------------------------
CSC Holdings, Inc., 7.625% Sr. Unsec.
Unsub. Nts., Series B, 4/1/11                          1,900,000       2,056,750
- --------------------------------------------------------------------------------
Dex Media East LLC/Dex Media East
Finance Co., 9.875% Sr. Unsec. Nts.,
11/15/09                                                 800,000         915,000


            8 | OPPENHEIMER HIGH INCOME FUND/VA


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
Dex Media West LLC, 5.875% Sr. Nts.,
11/15/11 3                                         $   1,800,000   $   1,800,000
- --------------------------------------------------------------------------------
Dex Media West LLC/Dex Media West
Finance Co.:
8.50% Sr. Nts., 8/15/10                                  700,000         782,250
9.875% Sr. Sub. Nts., 8/15/13                          1,172,000       1,356,590
- --------------------------------------------------------------------------------
Dex Media, Inc., 8% Unsec. Nts.,
11/15/13                                               3,550,000       3,860,625
- --------------------------------------------------------------------------------
DirecTV Holdings LLC/DirecTV
Financing Co., Inc., 8.375% Sr. Unsec.
Nts., 3/15/13                                          3,400,000       3,829,250
- --------------------------------------------------------------------------------
EchoStar DBS Corp.:
6.625% Sr. Nts., 10/1/14 3                             2,350,000       2,391,125
9.125% Sr. Nts., 1/15/09                               1,895,000       2,093,975
- --------------------------------------------------------------------------------
Emmis Operating Co., 6.875% Sr. Unsec.
Sub. Nts., 5/15/12                                     1,200,000       1,261,500
- --------------------------------------------------------------------------------
Entravision Communications Corp.,
8.125% Sr. Sub. Nts., 3/15/09                            600,000         643,500
- --------------------------------------------------------------------------------
Granite Broadcasting Corp., 9.75%
Sr. Sec. Nts., 12/1/10                                 1,257,000       1,206,720
- --------------------------------------------------------------------------------
Gray Television, Inc., 9.25% Sr. Sub. Nts.,
12/15/11                                                 500,000         562,500
- --------------------------------------------------------------------------------
Lamar Media Corp., 7.25% Sr. Unsec.
Sub. Nts., 1/1/13                                        200,000         217,000
- --------------------------------------------------------------------------------
Lin Television Corp., 6.50% Sr. Sub. Nts.,
5/15/13                                                  500,000         516,875
- --------------------------------------------------------------------------------
LodgeNet Entertainment Corp.,
9.50% Sr. Sub. Debs., 6/15/13                            400,000         444,000
- --------------------------------------------------------------------------------
Mediacom LLC/Mediacom Capital
Corp., 9.50% Sr. Unsec. Nts., 1/15/13                  1,257,000       1,267,999
- --------------------------------------------------------------------------------
MediaNews Group, Inc.:
6.375% Sr. Sub. Nts., 4/1/14                           1,400,000       1,393,000
6.875% Sr. Unsec. Sub. Nts., 10/1/13                     500,000         515,000
- --------------------------------------------------------------------------------
News America Holdings, Inc., 8.875%
Sr. Debs., 4/26/23                                       625,000         814,644
- --------------------------------------------------------------------------------
PanAmSat Corp., 9% Sr. Nts., 8/15/14 3                 2,000,000       2,242,500
- --------------------------------------------------------------------------------
PRIMEDIA, Inc.:
8% Sr. Nts., 5/15/13                                   1,700,000       1,757,375
8.875% Sr. Unsec. Nts., 5/15/11                           57,000          60,563
- --------------------------------------------------------------------------------
R.H. Donnelley Financial Corp. I:
8.875% Sr. Nts., 12/15/10 3                              700,000         784,000
10.875% Sr. Sub. Nts., 12/15/12 3                      1,000,000       1,192,500
- --------------------------------------------------------------------------------
Radio One, Inc., 8.875% Sr. Unsec. Sub.
Nts., Series B, 7/1/11                                   800,000         875,000
- --------------------------------------------------------------------------------
Rainbow National Services LLC, 8.75%
Sr. Nts., 9/1/12 3                                     1,800,000       1,984,500
- --------------------------------------------------------------------------------
Rogers Cable, Inc., 6.75% Sr. Sec. Second
Priority Nts., 3/15/15 3                                 500,000         513,750
- --------------------------------------------------------------------------------
Sinclair Broadcast Group, Inc., 8%
Sr. Unsec. Sub. Nts., 3/15/12                          1,600,000       1,708,000


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
Spanish Broadcasting System, Inc.,
9.625% Sr. Unsec. Sub. Nts., 11/1/09               $     600,000   $     631,500
- --------------------------------------------------------------------------------
Vertis, Inc.:
9.75% Sr. Sec. Nts., 4/1/09                              500,000         545,000
10.875% Sr. Unsec. Nts., Series B,
6/15/09                                                  650,000         708,500
- --------------------------------------------------------------------------------
WMG Holdings Corp.:
0%/9.50% Sr. Disc. Nts., 12/15/14 3,6                  2,000,000       1,287,500
6.905% Sr. Nts., 12/15/11 2,3                            900,000         911,250
- --------------------------------------------------------------------------------
WRC Media, Inc./Weekly Reader Corp./
CompassLearning, Inc., 12.75%
Sr. Sub. Nts., 11/15/09                                1,100,000       1,051,875
                                                                   -------------
                                                                      64,889,219

- --------------------------------------------------------------------------------
MULTILINE RETAIL--0.1%
Saks, Inc.:
8.25% Sr. Unsec. Nts., 11/15/08                          250,000         275,000
9.875% Nts., 10/1/11                                     300,000         357,000
                                                                   -------------
                                                                         632,000

- --------------------------------------------------------------------------------
SPECIALTY RETAIL--1.1%
Asbury Automotive Group, Inc., 9%
Sr. Sub. Nts., 6/15/12                                   600,000         633,000
- --------------------------------------------------------------------------------
Atlantic Broadband Finance LLC, 9.375%
Sr. Sub. Nts., 1/15/14 3                                 500,000         486,250
- --------------------------------------------------------------------------------
AutoNation, Inc., 9% Sr. Unsec. Nts.,
8/1/08                                                 1,200,000       1,377,000
- --------------------------------------------------------------------------------
Boise Cascade LLC/Boise Cascade
Finance Corp., 7.125% Sr. Sub. Nts.,
10/15/14 3                                               950,000       1,009,375
- --------------------------------------------------------------------------------
Building Materials Corp. of America,
8% Sr. Nts, 12/1/08                                      300,000         310,500
- --------------------------------------------------------------------------------
Eye Care Centers of America, Inc.,
9.125% Sr. Unsec. Sub. Nts., 5/1/08                      400,000         402,000
- --------------------------------------------------------------------------------
Finlay Fine Jewelry Corp., 8.375%
Sr. Unsec. Nts., 6/1/12                                  600,000         651,000
- --------------------------------------------------------------------------------
Hollywood Entertainment Corp.,
9.625% Sr. Sub. Nts., 3/15/11                            300,000         319,500
- --------------------------------------------------------------------------------
Petco Animal Supplies, Inc., 10.75%
Sr. Sub. Nts., 11/1/11                                   750,000         881,250
- --------------------------------------------------------------------------------
Rent-A-Center, Inc., 7.50% Sr. Unsec.
Sub. Nts., Series B, 5/1/10                              350,000         364,438
                                                                   -------------
                                                                       6,434,313

- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--1.0%
Invista, Inc., 9.25% Sr. Nts., 5/1/12 3                2,500,000       2,800,000
- --------------------------------------------------------------------------------
Levi Strauss & Co.:
7% Unsec. Nts., 11/1/06                                  800,000         844,000
9.75% Sr. Nts., 1/15/15 3                              1,100,000       1,094,500
11.625% Sr. Unsec. Nts., 1/15/08                         100,000         105,500


            9 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS Continued
Oxford Industries, Inc.,
8.875% Sr. Nts., 6/1/11                            $     500,000   $     539,375
- --------------------------------------------------------------------------------
Russell Corp., 9.25% Sr. Nts., 5/1/10                    600,000         646,500
                                                                   -------------
                                                                       6,029,875

- --------------------------------------------------------------------------------
CONSUMER STAPLES--3.1%
- --------------------------------------------------------------------------------
BEVERAGES--0.1%
Constellation Brands, Inc., 8.125%
Sr. Sub. Nts., 1/15/12                                   500,000         545,625
- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--0.6%
Great Atlantic & Pacific Tea Co., Inc.
(The), 9.125% Sr. Nts., 12/15/11                         457,000         430,723
- --------------------------------------------------------------------------------
Ingles Markets, Inc., 8.875% Sr. Unsec.
Sub. Nts., 12/1/11                                        57,000          61,275
- --------------------------------------------------------------------------------
Jean Coutu Group (PJC), Inc. (The):
7.625% Sr. Nts., 8/1/12 3                                650,000         690,625
8.50% Sr. Sub. Nts., 8/1/14 3                          1,100,000       1,133,000
- --------------------------------------------------------------------------------
Real Time Data Co., 11% Disc. Nts.,
5/31/09 1,4,5,7                                          476,601              --
- --------------------------------------------------------------------------------
Rite Aid Corp.:
8.125% Sr. Sec. Nts., 5/1/10                             900,000         956,250
9.50% Sr. Sec. Nts., 2/15/11                             450,000         496,125
                                                                   -------------
                                                                       3,767,998

- --------------------------------------------------------------------------------
FOOD PRODUCTS--2.0%
American Seafoods Group LLC,
10.125% Sr. Sub. Nts., 4/15/10                           500,000         537,500
- --------------------------------------------------------------------------------
Burns Philp Capital Property Ltd.,
9.75% Sr. Unsec. Sub. Nts., 7/15/12                      400,000         442,000
- --------------------------------------------------------------------------------
Chiquita Brands International, Inc.,
7.50% Sr. Nts., 11/1/14 1                                300,000         305,250
- --------------------------------------------------------------------------------
Del Monte Corp.:
8.625% Sr. Sub. Nts., 12/15/12                         1,000,000       1,125,000
9.25% Sr. Unsec. Sub. Nts., 5/15/11                      100,000         110,000
- --------------------------------------------------------------------------------
Doane Pet Care Co.:
9.75% Sr. Unsec. Sub. Nts., 5/15/07                      400,000         396,000
10.75% Sr. Nts., 3/1/10                                1,500,000       1,612,500
- --------------------------------------------------------------------------------
Dole Food Co., Inc.:
8.625% Sr. Nts., 5/1/09                                  900,000         983,250
8.875% Sr. Unsec. Nts., 3/15/11                          400,000         437,000
- --------------------------------------------------------------------------------
Hines Nurseries, Inc., 10.25% Sr. Unsec.
Sub. Nts., 10/1/11                                       600,000         658,500
- --------------------------------------------------------------------------------
Pinnacle Foods Holding Corp.:
8.25% Sr. Sub. Nts., 12/1/13 3                           500,000         478,750
8.25% Sr. Sub. Nts., 12/1/13 3                           600,000         574,500
- --------------------------------------------------------------------------------
Smithfield Foods, Inc.:
7.625% Sr. Unsec. Sub. Nts., 2/15/08                     925,000         994,375
8% Sr. Nts., Series B, 10/15/09                          900,000       1,001,250


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
FOOD PRODUCTS Continued
Swift & Co., 10.125% Sr. Nts., 10/1/09             $   1,000,000   $   1,120,000
- --------------------------------------------------------------------------------
United Biscuits Finance plc, 10.625%
Sr. Sub. Nts., 4/15/11 [EUR]                           1,000,000       1,440,805
                                                                   -------------
                                                                      12,216,680

- --------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--0.4%
Church & Dwight Co., Inc., 6%
Sr. Sub. Nts., 12/15/12 3                                500,000         511,250
- --------------------------------------------------------------------------------
Playtex Products, Inc.:
8% Sr. Sec. Nts., 3/1/11                               1,000,000       1,097,500
9.375% Sr. Unsec. Sub. Nts., 6/1/11                      700,000         750,750
                                                                   -------------
                                                                       2,359,500

- --------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.0%
Elizabeth Arden, Inc., 7.75% Sr. Unsec.
Sub. Nts., 1/15/14                                       300,000         319,500

- --------------------------------------------------------------------------------
ENERGY--7.0%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--1.1%
BRL Universal Equipment Corp., 8.875%
Sr. Sec. Nts., 2/15/08                                   750,000         792,188
- --------------------------------------------------------------------------------
Dresser, Inc., 9.375% Sr. Sub. Nts.,
4/15/11                                                  400,000         440,000
- --------------------------------------------------------------------------------
Grant Prideco, Inc., 9% Sr. Unsec. Nts.,
12/15/09                                                 300,000         333,750
- --------------------------------------------------------------------------------
Hanover Compress Co., 8.625% Sr. Nts.,
12/15/10                                                 700,000         768,250
- --------------------------------------------------------------------------------
Hanover Equipment Trust 2001A,
8.50% Sr. Sec. Nts., Series A, 9/1/08                    500,000         540,000
- --------------------------------------------------------------------------------
Hornbeck Offshore Services, Inc.,
6.125% Sr. Nts., 12/1/14 3                               750,000         757,500
- --------------------------------------------------------------------------------
Ocean Rig Norway AS, 10.25% Sr. Sec.
Nts., 6/1/08                                           1,350,000       1,397,250
- --------------------------------------------------------------------------------
Petroleum Helicopters, Inc., 9.375% Sr.
Nts., 5/1/09                                             600,000         660,000
- --------------------------------------------------------------------------------
Universal Compression, Inc., 7.25% Sr.
Unsec. Sub. Nts., 5/15/10 1                              800,000         858,000
                                                                   -------------
                                                                       6,546,938

- --------------------------------------------------------------------------------
OIL & GAS--5.9%
ANR Pipeline Co., 8.875% Sr. Nts.,
3/15/10                                                  400,000         450,000
- --------------------------------------------------------------------------------
Chesapeake Energy Corp.:
6.375% Sr. Nts., 6/15/15 3                               550,000         567,875
6.875% Sr. Unsec. Nts., 1/15/16                        1,120,000       1,178,800
9% Sr. Nts., 8/15/12                                     300,000         344,250
- --------------------------------------------------------------------------------
El Paso Corp., 7.875% Sr. Unsec. Nts.,
6/15/12                                                3,057,000       3,213,671
- --------------------------------------------------------------------------------
El Paso Energy Corp., 7.625% Nts.,
7/15/11                                                  350,000         364,000


            10 | OPPENHEIMER HIGH INCOME FUND/VA


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
OIL & GAS Continued
El Paso Production Holding Co.,
7.75% Sr. Unsec. Nts., 6/1/13                      $   3,000,000   $   3,157,500
- --------------------------------------------------------------------------------
EXCO Resources, Inc., 7.25% Sr. Nts.,
1/15/11                                                  800,000         860,000
- --------------------------------------------------------------------------------
Forest Oil Corp., 7.75% Sr. Nts., 5/1/14               1,000,000       1,092,500
- --------------------------------------------------------------------------------
Frontier Oil Corp., 6.625% Sr. Nts.,
10/1/11 3                                                450,000         461,250
- --------------------------------------------------------------------------------
MarkWest Energy Partners
LP/MarkWest Energy Finance Corp.,
6.875% Sr. Nts., 11/1/14 3                               250,000         255,000
- --------------------------------------------------------------------------------
Newfield Exploration Co.:
6.625% Sr. Unsec. Sub. Nts., 9/1/14 3                  1,300,000       1,381,250
8.375% Sr. Sub. Nts., 8/15/12                            600,000         675,000
- --------------------------------------------------------------------------------
Plains Exploration & Production Co.,
7.125% Sr. Nts., 6/15/14                                 600,000         657,000
- --------------------------------------------------------------------------------
Premcor Refining Group, Inc.:
6.75% Sr. Nts., 5/1/14                                   700,000         747,250
9.50% Sr. Nts., 2/1/13                                 1,000,000       1,165,000
- --------------------------------------------------------------------------------
Range Resources Corp., 7.375%
Sr. Sub. Nts., 7/15/13                                   400,000         431,000
- --------------------------------------------------------------------------------
Southern Natural Gas Co.:
7.35% Nts., 2/15/31                                      600,000         625,500
8% Sr. Unsub. Nts., 3/1/32 1                             900,000         986,625
8.875% Sr. Nts., 3/15/10                                 700,000         787,500
- --------------------------------------------------------------------------------
Stone Energy Corp.:
6.75% Sr. Sub. Nts., 12/15/14 3                          360,000         360,900
8.25% Sr. Unsec. Sub. Nts., 12/15/11                   1,600,000       1,736,000
- --------------------------------------------------------------------------------
Teekay Shipping Corp., 8.875% Sr. Nts.,
7/15/11                                                  575,000         669,875
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co., 7.50%
Bonds, 4/1/17                                          2,915,000       3,228,363
- --------------------------------------------------------------------------------
Tesoro Petroleum Corp.:
8% Sr. Sec. Nts., 4/15/08                              1,000,000       1,092,500
9.625% Sr. Sub. Nts., 4/1/12                             557,000         643,335
- --------------------------------------------------------------------------------
Transcontinental Gas Pipe Line Corp.:
6.125% Nts., 1/15/05                                     200,000         200,000
8.875% Sr. Unsub. Nts., Series B, 7/15/12                200,000         244,250
- --------------------------------------------------------------------------------
Whiting Petroleum Corp., 7.25% Sr. Sub.
Nts., 5/1/12                                             800,000         840,000
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The):
7.125% Nts., 9/1/11                                    2,550,000       2,798,625
7.625% Nts., 7/15/19                                   1,400,000       1,547,000
8.75% Unsec. Nts., 3/15/32                             1,900,000       2,192,125
- --------------------------------------------------------------------------------
Williams Holdings of Delaware, Inc.,
6.50% Nts., 12/1/08                                      300,000         315,000
- --------------------------------------------------------------------------------
XTO Energy, Inc., 7.50% Sr. Nts.,
4/15/12                                                1,000,000       1,171,886
                                                                   -------------
                                                                      36,440,830


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
FINANCIALS--1.9%
- --------------------------------------------------------------------------------
CAPITAL MARKETS--1.0%
American Color Graphics, Inc., 10%
Sr. Sec. Nts., 6/15/10                             $     400,000   $     339,500
- --------------------------------------------------------------------------------
BCP Caylux Holdings Luxembourg
SCA, 9.625% Sr. Sub. Nts., 6/15/14 3                   2,400,000       2,718,000
- --------------------------------------------------------------------------------
Berry Plastics Corp., 10.75% Sr. Sub.
Nts., 7/15/12                                          1,600,000       1,840,000
- --------------------------------------------------------------------------------
DeCrane Aircraft Holdings, Inc., 12%
Sr. Unsec. Sub. Nts., Series B, 9/30/08                1,550,000       1,046,250
                                                                   -------------
                                                                       5,943,750

- --------------------------------------------------------------------------------
COMMERCIAL BANKS--0.1%
Bank Plus Corp., 12% Sr. Nts., 7/18/07                   517,000         555,775
- --------------------------------------------------------------------------------
Western Financial Bank, 9.625% Unsec.
Sub. Debs., 5/15/12                                      400,000         458,000
                                                                   -------------
                                                                       1,013,775

- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--0.3%
Affinia Group, Inc., 9% Sr. Sub. Nts.,
11/30/14 3                                               450,000         471,375
- --------------------------------------------------------------------------------
Global Cash Access LLC/Global Cash
Finance Corp., 8.75% Sr. Sub. Nts.,
3/15/12 1                                                575,000         622,438
- --------------------------------------------------------------------------------
Universal City Florida:
7.20% Sr. Nts., 5/1/10 1,2                               270,000         282,150
8.375% Sr. Nts., 5/1/10 1                                270,000         281,475
                                                                   -------------
                                                                       1,657,438

- --------------------------------------------------------------------------------
REAL ESTATE--0.5%
American Casino & Entertainment
Properties LLC, 7.85% Sr. Sec. Nts.,
2/1/12                                                   800,000         854,000
- --------------------------------------------------------------------------------
Felcor Lodging LP, 9% Sr. Nts., 6/1/11                   837,000         952,088
- --------------------------------------------------------------------------------
HMH Properties, Inc., 7.875% Sr. Nts.,
Series B, 8/1/08                                         441,000         455,333
- --------------------------------------------------------------------------------
MeriStar Hospitality Corp.:
9.125% Sr. Unsec. Nts., 1/15/11                          457,000         495,845
10.50% Sr. Unsec. Nts., 6/15/09                          350,000         383,250
                                                                   -------------
                                                                       3,140,516

- --------------------------------------------------------------------------------
HEALTH CARE--5.7%
- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--0.8%
Dade Behring Holdings, Inc., 11.91% Sr.
Unsec. Sub. Nts., 10/3/10                                177,358         198,198
- --------------------------------------------------------------------------------
Fisher Scientific International, Inc.,
8.125% Sr. Sub. Nts., 5/1/12                             782,000         871,930
- --------------------------------------------------------------------------------
HMP Equity Holdings Corp., 17.95%
Sr. Disc. Nts., 5/15/08 8                              2,000,000       1,332,500


            11 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES Continued
Inverness Medical Innovations, Inc.,
8.75% Sr. Sub. Nts., 2/15/12 1                     $     600,000   $     630,000
- --------------------------------------------------------------------------------
Sybron Dental Specialties, Inc.,
8.125% Sr. Sub. Nts., 6/15/12                            700,000         766,500
- --------------------------------------------------------------------------------
Universal Hospital Services, Inc.,
10.125% Sr. Unsec. Nts., 11/1/11                         800,000         836,000
                                                                   -------------
                                                                       4,635,128

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--4.8%
Alderwoods Group, Inc., 7.75% Sr. Nts.,
9/15/12 3                                                950,000       1,030,750
- --------------------------------------------------------------------------------
AmeriPath, Inc., 10.50% Sr. Unsec. Sub.
Nts., 4/1/13                                             700,000         747,250
- --------------------------------------------------------------------------------
Beverly Enterprises, Inc., 7.875% Sr. Sub.
Nts., 6/15/14 1                                          600,000         646,500
- --------------------------------------------------------------------------------
Community Health Systems, Inc.,
6.50% Sr. Sub. Nts., 12/15/12 3                          900,000         911,250
- --------------------------------------------------------------------------------
Extendicare Health Services, Inc.:
6.875% Sr. Sub. Nts., 5/1/14                             600,000         615,000
9.50% Sr. Unsec. Sub. Nts., 7/1/10                       500,000         562,500
- --------------------------------------------------------------------------------
Fresenius Medical Care Capital Trust II,
7.875% Nts., 2/1/08                                    1,600,000       1,740,000
- --------------------------------------------------------------------------------
Genesis HealthCare Corp., 8% Sr. Sub.
Nts., 10/15/13                                           400,000         436,000
- --------------------------------------------------------------------------------
HCA, Inc.:
6.30% Sr. Unsec. Nts., 10/1/12                         3,200,000       3,250,387
6.375% Nts., 1/15/15                                   1,100,000       1,106,481
7.50% Bonds, 11/6/33                                     600,000         613,903
7.875% Sr. Nts., 2/1/11                                  305,000         336,366
8.75% Sr. Nts., 9/1/10                                   400,000         457,752
- --------------------------------------------------------------------------------
HealthSouth Corp.:
7.625% Nts., 6/1/12                                    1,000,000       1,010,000
10.75% Sr. Unsec. Sub. Nts., 10/1/08                     357,000         378,420
- --------------------------------------------------------------------------------
Magellan Health Services, Inc., 9.375%
Sr. Unsec. Nts., Series A, 11/15/08                    1,867,643       2,042,735
- --------------------------------------------------------------------------------
Medquest, Inc., 11.875% Sr. Unsec. Sub.
Nts., Series B, 8/15/12 1                                700,000         826,000
- --------------------------------------------------------------------------------
National Nephrology Assn., 9% Sr. Sub.
Nts., 11/1/11 3                                          200,000         232,500
- --------------------------------------------------------------------------------
NDCHealth Corp., 10.50% Sr. Unsec.
Sub. Nts., 12/1/12                                       600,000         648,000
- --------------------------------------------------------------------------------
PacifiCare Health Systems, Inc.,
10.75% Sr. Unsec. Unsub. Nts., 6/1/09                    714,000         828,240
- --------------------------------------------------------------------------------
Quintiles Transnational Corp.,
10% Sr. Sub. Nts., 10/1/13 1                             600,000         675,000
- --------------------------------------------------------------------------------
Rotech Healthcare, Inc., 9.50%
Sr. Unsec. Sub. Nts., 4/1/12 1                           600,000         663,000
- --------------------------------------------------------------------------------
Stewart Enterprises, Inc., 10.75%
Sr. Unsec. Sub. Nts., 7/1/08                           1,800,000       1,957,500


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES Continued
Tenet Healthcare Corp.:
6.375% Sr. Nts., 12/1/11                           $   1,660,000   $   1,547,950
7.375% Nts., 2/1/13                                       57,000          55,575
9.875% Sr. Nts., 7/1/14 3                              1,500,000       1,642,500
- --------------------------------------------------------------------------------
Triad Hospitals, Inc.:
7% Sr. Nts., 5/15/12                                     900,000         951,750
7% Sr. Sub. Nts., 11/15/13                             1,120,000       1,150,800
- --------------------------------------------------------------------------------
US Oncology, Inc.:
9% Sr. Nts., 8/15/12 3                                   650,000         729,625
10.75% Sr. Sub. Nts., 8/15/14 3                          650,000         755,625
- --------------------------------------------------------------------------------
Vicar Operating, Inc., 9.875%
Sr. Sub. Nts., 12/1/09                                 1,000,000       1,100,000
                                                                   -------------
                                                                      29,649,359

- --------------------------------------------------------------------------------
PHARMACEUTICALS--0.1%
Valeant Pharmaceuticals International,
Inc., 7% Sr. Nts., 12/15/11                              800,000         836,000

- --------------------------------------------------------------------------------
INDUSTRIALS--7.3%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.1%
Alliant Techsystems, Inc., 8.50%
Sr. Unsec. Sub. Nts., 5/15/11                            900,000         990,000
- --------------------------------------------------------------------------------
BE Aerospace, Inc.:
8% Sr. Unsec. Sub. Nts., Series B, 3/1/08                300,000         301,875
8.875% Sr. Unsec. Sub. Nts., 5/1/11                       57,000          59,850
- --------------------------------------------------------------------------------
L-3 Communications Corp.:
5.875% Sr. Sub. Nts., 1/15/15 3                        1,000,000       1,002,500
7.625% Sr. Sub. Nts., 6/15/12                            800,000         882,000
- --------------------------------------------------------------------------------
Rexnord Corp., 10.125% Sr. Unsec. Sub.
Nts., 12/15/12                                           700,000         794,500
- --------------------------------------------------------------------------------
TD Funding Corp., 8.375% Sr. Sub. Nts.,
7/15/11                                                  800,000         862,000
- --------------------------------------------------------------------------------
TRW Automotive, Inc.:
9.375% Sr. Nts., 2/15/13                                 580,000         675,700
11% Sr. Sub. Nts., 2/15/13                               454,000         549,340
- --------------------------------------------------------------------------------
Vought Aircraft Industries, Inc., 8%
Sr. Nts., 7/15/11                                        300,000         293,250
                                                                   -------------
                                                                       6,411,015

- --------------------------------------------------------------------------------
AIRLINES--0.3%
America West Airlines, Inc., 10.75%
Sr. Nts., 9/1/05                                       1,000,000       1,002,500
- --------------------------------------------------------------------------------
ATA Holdings Corp., 13% Sr. Unsec.
Nts., 2/1/09 4,5                                       1,575,000         905,625
                                                                   -------------
                                                                       1,908,125

- --------------------------------------------------------------------------------
BUILDING PRODUCTS--0.4%
Associated Materials, Inc., 9.75%
Sr. Sub. Nts., 4/15/12                                   700,000         785,750


            12 | OPPENHEIMER HIGH INCOME FUND/VA


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
BUILDING PRODUCTS Continued
Goodman Global Holding Co., Inc.,
7.875% Sr. Sub. Nts., 12/15/12 3                   $     360,000   $     358,200
- --------------------------------------------------------------------------------
Green Star Products, Inc., 10.15%
Bonds, 6/24/10 3                                         284,439         289,771
- --------------------------------------------------------------------------------
Jacuzzi Brands, Inc., 9.625%
Sr. Sec. Nts., 7/1/10                                    544,000         606,560
- --------------------------------------------------------------------------------
North America Energy Partners, Inc.,
8.75% Sr. Unsec. Nts., 12/1/11                           300,000         307,500
                                                                   -------------
                                                                       2,347,781

- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--1.9%
Allied Waste North America, Inc.:
7.375% Sr. Sec. Nts., Series B, 4/15/14                  300,000         288,750
7.875% Sr. Nts., 4/15/13                                 800,000         824,000
8.50% Sr. Sub. Nts., 12/1/08                           1,000,000       1,065,000
8.875% Sr. Nts., Series B, 4/1/08                      1,500,000       1,612,500
9.25% Sr. Sec. Debs., Series B, 9/1/12                 1,700,000       1,848,750
- --------------------------------------------------------------------------------
American Pad & Paper Co., 13% Sr. Sub.
Nts., Series B, 11/15/05 1,4,5                           200,000              --
- --------------------------------------------------------------------------------
Cenveo Corp., 7.875% Sr. Sub. Nts.,
12/1/13                                                1,600,000       1,496,000
- --------------------------------------------------------------------------------
Comforce Operating, Inc., 12%
Sr. Nts., Series B, 12/1/07                              350,000         345,625
- --------------------------------------------------------------------------------
Corrections Corp. of America:
7.50% Sr. Nts., 5/1/11                                   500,000         536,875
9.875% Sr. Nts., 5/1/09                                  500,000         557,500
- --------------------------------------------------------------------------------
Hydrochem Industrial Services, Inc.,
10.375% Sr. Sub. Nts., 8/1/07 1                          250,000         253,125
- --------------------------------------------------------------------------------
Kindercare Learning Centers, Inc.,
9.50% Sr. Sub. Nts., 2/15/09                             576,000         581,040
- --------------------------------------------------------------------------------
Mail-Well I Corp., 9.625% Sr. Nts.,
3/15/12 1                                                700,000         771,750
- --------------------------------------------------------------------------------
Protection One, Inc./Protection One
Alarm Monitoring, Inc., 7.375%
Sr. Unsec. Nts., 8/15/05                                 900,000         913,500
- --------------------------------------------------------------------------------
Synagro Technologies, Inc., 9.50%
Sr. Sub. Nts., 4/1/09                                    700,000         766,500
                                                                   -------------
                                                                      11,860,915

- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--0.1%
Integrated Electrical Services, Inc.,
9.375% Sr. Sub. Nts., Series C, 2/1/09                    58,000          54,810
- --------------------------------------------------------------------------------
URS Corp., 11.50% Sr. Unsec. Nts.,
9/15/09                                                  455,000         525,525
                                                                   -------------
                                                                         580,335

- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.5%
Belden & Blake Corp., 8.75%
Sr. Sec. Nts., 7/15/12 1                                 650,000         663,000


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT Continued
Dayton Superior Corp., 13%
Sr. Unsec. Sub. Nts., 6/15/09                      $     100,000   $     104,500
- --------------------------------------------------------------------------------
General Cable Corp., 9.50%
Sr. Nts., 11/15/10                                       500,000         567,500
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co., 7%
Sr. Unsec. Debs., 10/15/28                             1,500,000       1,511,250
                                                                   -------------
                                                                       2,846,250

- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.0%
Great Lakes Dredge & Dock Co., 7.75%
Sr. Unsec. Sub. Nts., 12/15/13                           250,000         228,750
- --------------------------------------------------------------------------------
MACHINERY--1.6%
AGCO Corp., 9.50% Sr. Unsec. Nts.,
5/1/08                                                 1,000,000       1,070,000
- --------------------------------------------------------------------------------
Douglas Dynamics LLC, 7.75% Sr. Nts.,
1/15/12 3                                                600,000         611,250
- --------------------------------------------------------------------------------
Dresser-Rand Group, Inc., 7.375%
Sr. Sub. Nts., 11/1/14 3                                 300,000         307,500
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The):
7.125% Sr. Nts., 11/1/13                                 150,000         163,125
10.50% Sr. Sub. Nts., 8/1/12                             800,000         924,000
- --------------------------------------------------------------------------------
Milacron Escrow Corp., 11.50%
Sr. Sec. Nts., 5/15/11 1                               1,200,000       1,278,000
- --------------------------------------------------------------------------------
Navistar International Corp., 7.50%
Sr. Nts., 6/15/11                                        800,000         862,000
- --------------------------------------------------------------------------------
NMHG Holding Co., 10% Sr. Nts.,
5/15/09                                                  600,000         666,000
- --------------------------------------------------------------------------------
SPX Corp., 7.50% Sr. Nts., 1/1/13                        900,000         981,000
- --------------------------------------------------------------------------------
Terex Corp.:
7.375% Sr. Unsec. Sub. Nts., 1/15/14                     500,000         538,750
9.25% Sr. Unsec. Sub. Nts., 7/15/11                      800,000         902,000
10.375% Sr. Unsec. Sub. Nts., Series B,
4/1/11                                                   500,000         562,500
- --------------------------------------------------------------------------------
Trinity Industries, Inc., 6.50% Sr. Nts.,
3/15/14                                                1,000,000       1,005,000
                                                                   -------------
                                                                       9,871,125

- --------------------------------------------------------------------------------
MARINE--0.4%
CP Ships Ltd., 10.375% Sr. Nts., 7/15/12               1,000,000       1,158,750
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc., 12%
Sr. Sec. Nts., 7/15/05 1,4,5                             700,000          16,870
- --------------------------------------------------------------------------------
Navigator Gas Transport plc, 10.50%
First Priority Ship Mtg. Nts., 6/30/07 1,4,5           1,000,000         756,250
- --------------------------------------------------------------------------------
Pacific & Atlantic Holdings, Inc., 3.75%
Sec. Nts., 12/31/07 3,7                                  429,249         198,571
                                                                   -------------
                                                                       2,130,441


            13 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
ROAD & RAIL--0.6%
Kansas City Southern Railway Co.
(The), 7.50% Sr. Nts., 6/15/09                     $     500,000   $     527,500
- --------------------------------------------------------------------------------
Stena AB:
7% Sr. Nts., 12/1/16 3                                 1,700,000       1,691,500
7.50% Sr. Unsec. Nts., 11/1/13                           928,000         976,720
9.625% Sr. Nts., 12/1/12                                 600,000         681,000
                                                                   -------------
                                                                       3,876,720

- --------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--0.2%
United Rentals, Inc., 7% Sr. Sub. Nts.,
2/15/14                                                1,500,000       1,410,000
- --------------------------------------------------------------------------------
TRANSPORTATION INFRASTRUCTURE--0.2%
Horizon Lines LLC, 9% Nts., 11/1/12 3                    600,000         648,000
- --------------------------------------------------------------------------------
Worldspan LP/Worldspan Financial
Corp., 9.625% Sr. Nts., 6/15/11                          550,000         550,000
                                                                   -------------
                                                                       1,198,000

- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--2.6%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--0.4%
Lucent Technologies, Inc., 6.45%
Unsec. Debs., 3/15/29                                  1,700,000       1,547,000
- --------------------------------------------------------------------------------
Orion Network Systems, Inc., 12.50%
Sr. Unsub. Disc. Nts., 1/15/07 1,4,5                   1,150,000         603,750
                                                                   -------------
                                                                       2,150,750

- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--0.1%
Seagate Technology Hdd Holdings, 8%
Sr. Nts., 5/15/09                                        700,000         759,500
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--0.9%
Flextronics International Ltd., 6.25%
Sr. Sub. Nts., 11/15/14 3                              2,300,000       2,288,500
- --------------------------------------------------------------------------------
Ingram Micro, Inc., 9.875% Sr. Unsec.
Sub. Nts., 8/15/08                                     1,200,000       1,311,000
- --------------------------------------------------------------------------------
LCE Acquisition Corp., 9% Sr. Sub. Nts.,
8/1/14 3                                                 875,000         951,563
- --------------------------------------------------------------------------------
Sensus Metering System, Inc., 8.625%
Sr. Unsec. Sub. Nts., 12/15/13                         1,000,000       1,030,000
                                                                   -------------
                                                                       5,581,063

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.0%
Exodus Communications, Inc., 10.75%
Sr. Nts., 12/15/09 1,4,5 [EUR]                           846,550          11,507
- --------------------------------------------------------------------------------
Globix Corp., 11% Sr. Nts., 5/1/08 7                      71,480          66,119
- --------------------------------------------------------------------------------
NorthPoint Communications Group,
Inc., 12.875% Nts., 2/15/10 1,4,5                        240,208              --
- --------------------------------------------------------------------------------
PSINet, Inc., 10.50% Sr. Unsec. Nts.,
12/1/06 1,4,5 [EUR]                                    1,000,000          54,370
                                                                   -------------
                                                                         131,996


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
IT SERVICES--0.3%
Iron Mountain, Inc.:
7.75% Sr. Sub. Nts., 1/15/15                       $     400,000   $     408,000
8.625% Sr. Unsec. Sub. Nts., 4/1/13                    1,000,000       1,067,500
- --------------------------------------------------------------------------------
Titan Corp. (The), 8% Sr. Sub. Nts.,
5/15/11                                                  400,000         428,000
                                                                   -------------
                                                                       1,903,500

- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--0.9%
AMI Semiconductor, Inc., 10.75%
Sr. Unsec. Sub. Nts., 2/1/13                             682,000         804,760
- --------------------------------------------------------------------------------
Amkor Technology, Inc.:
7.75% Sr. Nts., 5/15/13                                  120,000         113,400
9.25% Sr. Unsec. Sub. Nts., 2/15/08                    1,000,000       1,027,500
- --------------------------------------------------------------------------------
Freescale Semiconductor, Inc., 7.125%
Sr. Unsec. Nts., 7/15/14                               1,300,000       1,417,000
- --------------------------------------------------------------------------------
Huntsman International LLC, 7.375%
Sr. Sub. Nts., 1/1/15 3                                1,550,000       1,561,625
- --------------------------------------------------------------------------------
MagnaChip Semiconductor Ltd., 8%
Sr. Sub. Nts., 12/15/14 3                                181,000         189,598
                                                                   -------------
                                                                       5,113,883

- --------------------------------------------------------------------------------
MATERIALS--11.5%
- --------------------------------------------------------------------------------
CHEMICALS--3.8%
Avecia Group plc, 11% Sr. Unsec. Nts.,
7/1/09                                                   117,000         121,095
- --------------------------------------------------------------------------------
ClimaChem, Inc., 10.75% Sr. Unsec. Nts.,
Series B, 12/1/07                                        250,000         167,500
- --------------------------------------------------------------------------------
Compass Minerals Group, Inc., 10%
Sr. Sub. Nts., 8/15/11                                 1,200,000       1,356,000
- --------------------------------------------------------------------------------
Crompton Corp., 9.875% Sr. Nts.,
8/1/12 3                                                 800,000         920,000
- --------------------------------------------------------------------------------
Equistar Chemicals LP/
Equistar Funding Corp.:
8.75% Sr. Unsec. Nts., 2/15/09                           400,000         450,000
10.125% Sr. Unsec. Nts., 9/1/08                           57,000          65,978
10.625% Sr. Unsec. Nts., 5/1/11                        1,800,000       2,097,000
- --------------------------------------------------------------------------------
Huntsman Co. LLC:
11.625% Sr. Unsec. Nts., 10/15/10                         57,000          67,688
11.75% Sr. Nts., 7/15/12 3                             1,300,000       1,543,750
- --------------------------------------------------------------------------------
Huntsman Corp./ICI Chemical Co. plc:
10.125% Sr. Unsec. Sub. Nts.,
7/1/09 [EUR]                                              60,838          88,698
10.125% Sr. Unsec. Sub. Nts., 7/1/09 9                 1,645,000       1,739,588
13.09% Sr. Unsec. Disc. Nts., 12/31/09 8                 400,000         226,000
- --------------------------------------------------------------------------------
Huntsman International LLC, 9.875%
Sr. Nts., 3/1/09                                       2,000,000       2,205,000
- --------------------------------------------------------------------------------
IMC Global, Inc.:
7.625% Bonds, 11/1/05 1                                    3,000           3,075
10.875% Sr. Unsec. Nts., 8/1/13 1                         57,000          71,535
10.875% Sr. Unsec. Nts., Series B, 6/1/08                 11,627          14,011


            14 | OPPENHEIMER HIGH INCOME FUND/VA


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
CHEMICALS Continued
Innophos, Inc., 8.875% Sr. Sub. Nts.,
8/15/14 1                                          $     800,000   $     868,000
- --------------------------------------------------------------------------------
ISP Chemco, Inc., 10.25% Sr. Unsec. Sub.
Nts., 7/1/11                                             500,000         567,500
- --------------------------------------------------------------------------------
ISP Holdings, Inc., 10.625% Sr. Sec. Nts.,
12/15/09                                                 300,000         333,750
- --------------------------------------------------------------------------------
KI Holdings, Inc., 0%/9.875%
Sr. Disc. Nts., 11/15/14 3,6                             750,000         483,750
- --------------------------------------------------------------------------------
Lyondell Chemical Co.:
9.50% Sec. Nts., 12/15/08                                 57,000          62,130
9.50% Sr. Sec. Nts., 12/15//08                           100,000         109,000
9.625% Sr. Sec. Nts., Series A, 5/1/07                 1,300,000       1,436,500
9.80% Debs., 2/1/20                                      900,000       1,030,500
9.875% Sec. Nts., Series B, 5/1/07                       420,000         442,050
10.50% Sr. Sec. Nts., 6/1/13                             300,000         358,500
11.125% Sr. Sec. Nts., 7/15/12                           300,000         357,750
- --------------------------------------------------------------------------------
Millennium America, Inc., 9.25%
Sr. Unsec. Sub. Nts., 6/15/08                            711,627         813,034
- --------------------------------------------------------------------------------
PCI Chemicals Canada, 10%
Sr. Sec. Nts., 12/31/08                                  319,909         340,703
- --------------------------------------------------------------------------------
Pioneer Cos., Inc., 6.05%
Sr. Sec. Nts., 12/31/06 2                                101,304         106,876
- --------------------------------------------------------------------------------
PolyOne Corp.:
8.875% Sr. Unsec. Nts., 5/1/12                         1,550,000       1,693,375
10.625% Sr. Unsec. Nts., 5/15/10                         357,000         403,410
- --------------------------------------------------------------------------------
Resolution Performance Products LLC:
8% Sr. Sec. Nts., 12/15/09                               450,000         486,000
13.50% Sr. Unsec. Sub. Nts., 11/15/10                    300,000         327,750
- --------------------------------------------------------------------------------
Rhodia SA, 10.25% Sr. Unsec.
Nts., 6/1/10                                             500,000         565,000
- --------------------------------------------------------------------------------
Rockwood Specialties Group, Inc.:
7.50% Sr. Sub. Nts., 11/15/14 3                          400,000         417,000
10.625% Sr. Unsec. Sub. Nts., 5/15/11                    400,000         462,000
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc., 10%
Sr. Sec. Nts., 12/19/07 7                                409,135         411,181
- --------------------------------------------------------------------------------
Westlake Chemical Corp., 8.75%
Sr. Nts., 7/15/11                                        260,000         295,100
                                                                   -------------
                                                                      23,562,140

- --------------------------------------------------------------------------------
CONSTRUCTION MATERIALS--0.1%
Texas Industries, Inc., 10.25%
Sr. Unsec. Nts., 6/15/11                                 800,000         940,000
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING--2.9%
Crown Euro Holdings SA, 9.50%
Sr. Sec. Nts., 3/1/11                                    900,000       1,030,500
- --------------------------------------------------------------------------------
Graham Packaging Co., Inc.:
8.50% Sr. Nts., 10/15/12 3                               350,000         369,250
9.875% Sub. Nts., 10/15/14 3                             600,000         643,500


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING Continued
Graphic Packaging International Corp.:
8.50% Sr. Nts., 8/15/11                            $   1,000,000   $   1,097,500
9.50% Sr. Sub. Nts., 8/15/13                             700,000         799,750
- --------------------------------------------------------------------------------
Jefferson Smurfit Corp.:
7.50% Sr. Unsec. Unsub. Nts., 6/1/13                     350,000         375,375
8.25% Sr. Unsec. Nts., 10/1/12                           900,000         985,500
- --------------------------------------------------------------------------------
MDP Acquisitions plc, 9.625%
Sr. Nts., 10/1/12                                        800,000         896,000
- --------------------------------------------------------------------------------
Owens-Brockway Glass Container, Inc.:
7.75% Sr. Sec. Nts., 5/15/11                           1,000,000       1,087,500
8.25% Sr. Unsec. Nts., 5/15/13                           557,000         615,485
8.75% Sr. Sec. Nts., 11/15/12                          1,350,000       1,528,875
8.875% Sr. Sec. Nts., 2/15/09                          1,300,000       1,418,625
- --------------------------------------------------------------------------------
Pliant Corp., 0%/11.125% Sr. Sec.
Disc. Nts., 6/15/09 6                                    600,000         557,250
- --------------------------------------------------------------------------------
Solo Cup Co., 8.50% Sr. Sub. Nts.,
2/15/14                                                1,500,000       1,567,500
- --------------------------------------------------------------------------------
Stone Container Corp.:
8.375% Sr. Nts., 7/1/12                                  750,000         821,250
9.25% Sr. Unsec. Nts., 2/1/08                          1,000,000       1,110,000
9.75% Sr. Unsec. Nts., 2/1/11                          1,000,000       1,100,000
- --------------------------------------------------------------------------------
Stone Container Finance Co. of Canada
II, 7.375% Sr. Unsec. Nts., 7/15/14                      600,000         642,000
- --------------------------------------------------------------------------------
TriMas Corp., 9.875% Sr. Unsec. Sub. Nts.,
6/15/12 1                                              1,000,000       1,065,000
                                                                   -------------
                                                                      17,710,860

- --------------------------------------------------------------------------------
METALS & MINING--2.7%
AK Steel Corp.:
7.75% Sr. Unsec. Nts., 6/15/12                           557,000         576,495
7.875% Sr. Unsec. Nts., 2/15/09                          300,000         307,125
- --------------------------------------------------------------------------------
Arch Western Finance LLC, 6.75%
Sr. Nts., 7/1/13                                         800,000         830,000
- --------------------------------------------------------------------------------
California Steel Industries, Inc., 6.125%
Sr. Nts., 3/15/14                                        800,000         798,000
- --------------------------------------------------------------------------------
Century Aluminum Co., 7.50% Sr. Nts.,
8/15/14 3                                              1,300,000       1,391,000
- --------------------------------------------------------------------------------
Foundation PA Coal Co., 7.25% Sr. Nts.,
8/1/14 3                                                 650,000         695,500
- --------------------------------------------------------------------------------
IMCO Recycling, Inc., 10.375%
Sr. Sec. Nts., 10/15/10                                  700,000         798,000
- --------------------------------------------------------------------------------
International Steel Group, Inc.,
6.50% Sr. Nts., 4/15/14                                  300,000         323,250
- --------------------------------------------------------------------------------
IPSCO, Inc., 8.75% Sr. Nts., 6/1/13                      300,000         345,000
- --------------------------------------------------------------------------------
Ispat Inland ULC, 9.75% Sr. Sec. Nts.,
4/1/14                                                 1,364,000       1,691,360
- --------------------------------------------------------------------------------
Jorgensen (Earle M.) Co., 9.75%
Sr. Sec. Nts., 6/1/12                                    800,000         904,000


            15 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
METALS & MINING Continued
Kaiser Aluminum & Chemical Corp.,
10.875% Sr. Nts., Series B, 10/15/06 4,5           $   1,000,000   $     887,500
- --------------------------------------------------------------------------------
Koppers Industry, Inc., 9.875%
Sr. Sec. Nts., 10/15/13                                  900,000       1,030,500
- --------------------------------------------------------------------------------
Massey Energy Co., 6.625% Sr. Nts.,
11/15/10                                                 400,000         420,000
- --------------------------------------------------------------------------------
Metallurg, Inc., 11% Sr. Nts., 12/1/07                   740,000         647,500
- --------------------------------------------------------------------------------
Northwest Pipeline Corp., 8.125%
Sr. Nts., 3/1/10                                         200,000         222,250
- --------------------------------------------------------------------------------
Oregon Steel Mills, Inc., 10% Sr. Nts.,
7/15/09                                                1,300,000       1,452,750
- --------------------------------------------------------------------------------
Peabody Energy Corp., 6.875%
Sr. Unsec. Nts., Series B, 3/15/13                     1,000,000       1,087,500
- --------------------------------------------------------------------------------
Steel Dynamics, Inc., 9.50% Sr. Nts.,
3/15/09                                                  400,000         440,000
- --------------------------------------------------------------------------------
UCAR Finance, Inc., 10.25% Sr. Nts.,
2/15/12 1                                                400,000         459,000
- --------------------------------------------------------------------------------
United States Steel Corp.:
9.75% Sr. Nts., 5/15/10                                  505,000         578,225
10.75% Sr. Nts., 8/1/08                                  389,000         459,993
                                                                   -------------
                                                                      16,344,948

- --------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--2.0%
Abitibi-Consolidated, Inc., 8.55% Nts.,
8/1/10                                                   300,000         326,625
- --------------------------------------------------------------------------------
Appleton Papers, Inc., 8.125% Sr. Nts.,
6/15/11                                                  600,000         649,500
- --------------------------------------------------------------------------------
Buckeye Technologies, Inc.,
8.50% Sr. Nts., 10/1/13                                  350,000         381,500
- --------------------------------------------------------------------------------
Georgia-Pacific Corp.:
7.75% Sr. Unsec. Nts., 11/15/29                        2,000,000       2,250,000
8.125% Sr. Unsec. Nts., 5/15/11                        2,200,000       2,541,000
9.375% Sr. Unsec. Nts., 2/1/13                         1,600,000       1,872,000
- --------------------------------------------------------------------------------
Inland Fiber Group LLC, 9.625%
Sr. Unsec. Nts., 11/15/07 1,4,5                          300,000         136,500
- --------------------------------------------------------------------------------
Norske Skog Canada Ltd., 7.375%
Sr. Unsec. Nts., 3/1/14                                  600,000         628,500
- --------------------------------------------------------------------------------
Riverside Forest Products Ltd., 7.875%
Sr. Unsec. Sub. Nts., 3/1/14                             600,000         663,000
- --------------------------------------------------------------------------------
Tekni-Plex, Inc., 8.75% Sr. Sec. Nts.,
11/15/13 3                                             1,557,000       1,557,000
- --------------------------------------------------------------------------------
Tembec Industries, Inc.:
7.75% Sr. Nts., 3/15/12                                  700,000         680,750
8.50% Sr. Unsec. Nts., 2/1/11                             57,000          57,570
- --------------------------------------------------------------------------------
Western Forest Products, Inc., 15%
Sec. Nts., 7/28/09 3,7                                   417,000         472,253
                                                                   -------------
                                                                      12,216,198


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--9.6%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--3.7%
American Tower Corp.:
7.125% Sr. Unsec. Nts., 10/15/12 3                 $     500,000   $     513,750
9.375% Sr. Nts., 2/1/09 9                                161,000         171,063
- --------------------------------------------------------------------------------
Citizens Communications Co.:
6.25% Sr. Nts., 1/15/13                                1,400,000       1,417,500
9% Sr. Unsec. Unsub. Nts., 8/15/31                       600,000         688,500
9.25% Sr. Nts., 5/15/11                                  800,000         940,000
- --------------------------------------------------------------------------------
Crown Castle International Corp.,
7.50% Sr. Nts., 12/1/13                                  900,000         972,000
- --------------------------------------------------------------------------------
MCI, Inc.:
6.908% Sr. Unsec. Nts., 5/1/07 2                       2,729,000       2,800,636
7.688% Sr. Unsec. Nts., 5/1/09 2                       1,000,000       1,037,500
- --------------------------------------------------------------------------------
PSINet, Inc., 11% Sr. Nts., 8/1/09 1,4,5                 886,049          13,291
- --------------------------------------------------------------------------------
Qwest Capital Funding, Inc., 7.90%
Unsec. Nts., 8/15/10                                   1,657,000       1,681,855
- --------------------------------------------------------------------------------
Qwest Communications International,
Inc., 7.25% Sr. Nts., 2/15/11 3                          600,000         618,000
- --------------------------------------------------------------------------------
Qwest Corp.:
6.875% Unsec. Debs., 9/15/33                           1,000,000         925,000
9.125% Nts., 3/15/12 3                                 2,500,000       2,900,000
- --------------------------------------------------------------------------------
Qwest Services Corp.:
14% Nts., 12/15/10 2,3                                 4,800,000       5,796,000
14.50% Nts., 12/15/14 3                                1,700,000       2,159,000
- --------------------------------------------------------------------------------
Teligent, Inc., 11.50% Sr. Nts., 12/1/07 1,4,5           400,000              --
- --------------------------------------------------------------------------------
Time Warner Telecom LLC/Time Warner
Telecom, Inc., 9.75% Sr. Nts., 7/15/08                   100,000         101,750
- --------------------------------------------------------------------------------
Winstar Communications, Inc., 12.75%
Sr. Nts., 4/15/10 1,4,5                                1,000,000              --
                                                                   -------------
                                                                      22,735,845

- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--5.9%
Alamosa Delaware, Inc.:
8.50% Sr. Nts., 1/31/12                                1,000,000       1,097,500
11% Sr. Unsec. Nts., 7/31/10                              57,000          67,403
12.50% Sr. Unsec. Nts., 2/1/11                           100,000         113,500
- --------------------------------------------------------------------------------
American Cellular Corp., 10% Sr. Nts.,
Series B, 8/1/11                                         200,000         172,500
- --------------------------------------------------------------------------------
American Tower Corp., 7.50% Sr. Nts.,
5/1/12                                                 1,650,000       1,740,750
- --------------------------------------------------------------------------------
American Tower Escrow Corp., 12.25%
Sr. Sub. Disc. Nts., 8/1/08 8                          1,400,000       1,053,500
- --------------------------------------------------------------------------------
AT&T Corp., 9.05% Sr. Unsec. Nts.,
11/15/11 2                                             3,250,000       3,757,813
- --------------------------------------------------------------------------------
CellNet Data Systems, Inc., Sr. Unsec.
Disc. Nts., 10/1/07 1,4,5                              1,834,000              --
- --------------------------------------------------------------------------------
Centennial Cellular Operating Co.
LLC/Centennial Communications Corp.,
10.125% Sr. Nts., 6/15/13                              1,700,000       1,916,750


            16 | OPPENHEIMER HIGH INCOME FUND/VA


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES Continued
Crown Castle International Corp.,
10.75% Sr. Nts., 8/1/11                            $   2,050,000   $   2,234,500
- --------------------------------------------------------------------------------
Dobson Cellular Systems, 8.375%
Sec. Nts., 11/1/11 3                                     270,000         280,125
- --------------------------------------------------------------------------------
Dobson Communications Corp.,
8.875% Sr. Nts., 10/1/13                                 507,000         358,703
- --------------------------------------------------------------------------------
IWO Escrow Co., Sr. Sec. Nts.,
1/15/12 2,3,9                                            220,000         222,750
- --------------------------------------------------------------------------------
Nextel Communications, Inc.,
7.375% Sr. Nts., 8/1/15                                6,490,000       7,171,450
- --------------------------------------------------------------------------------
Nextel Partners, Inc.:
8.125% Sr. Nts., 7/1/11                                  700,000         780,500
12.50% Sr. Nts., 11/15/09                              1,162,000       1,321,775
- --------------------------------------------------------------------------------
Rogers Wireless Communications, Inc.:
6.375% Sec. Nts., 3/1/14                               2,400,000       2,388,000
7.50% Sr. Sec. Nts., 3/15/15 3                           900,000         954,000
8% Sr. Sub. Nts., 12/15/12 3                             800,000         850,000
- --------------------------------------------------------------------------------
Rural Cellular Corp.:
8.25% Sr. Sec. Nts., 3/15/12                             775,000         823,438
9.75% Sr. Sub. Nts., 1/15/10                             457,000         415,870
9.875% Sr. Nts., 2/1/10                                1,100,000       1,124,750
- --------------------------------------------------------------------------------
SBA Communications Corp., 8.50%
Sr. Nts., 12/1/12 3                                    1,150,000       1,178,750
- --------------------------------------------------------------------------------
SBA Telecommunications, Inc./SBA
Communications Corp., 0%/9.75%
Sr. Disc. Nts., 12/15/11 6                             2,357,000       1,997,558
- --------------------------------------------------------------------------------
Triton PCS, Inc., 8.50%
Sr. Unsec. Nts., 6/1/13                                1,300,000       1,261,000
- --------------------------------------------------------------------------------
UbiquiTel Operating Co., 9.875%
Sr. Nts., 3/1/11                                       1,100,000       1,240,250
- --------------------------------------------------------------------------------
US Unwired, Inc., 10% Sr. Sec. Nts.,
6/15/12                                                  500,000         566,250
- --------------------------------------------------------------------------------
Western Wireless Corp., 9.25%
Sr. Unsec. Nts., 7/15/13                               1,057,000       1,154,773
                                                                   -------------
                                                                      36,244,158

- --------------------------------------------------------------------------------
UTILITIES--6.2%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--3.9%
AES Corp. (The), 8.75% Sr. Sec. Nts.,
5/15/13 3                                              1,150,000       1,312,438
- --------------------------------------------------------------------------------
Allegheny Energy, Inc., 7.75% Nts.,
8/1/05                                                   300,000         305,625
- --------------------------------------------------------------------------------
Caithness Coso Funding Corp.,
9.05% Sr. Sec. Nts., Series B, 12/15/09                  366,797         405,311
- --------------------------------------------------------------------------------
Calpine Corp., 7.625% Sr. Nts., 4/15/06                  360,000         355,500
- --------------------------------------------------------------------------------
CenterPoint Energy, Inc., 7.25%
Sr. Nts., Series B, 9/1/10                             1,600,000       1,786,640
- --------------------------------------------------------------------------------
CMS Energy Corp.:
7.50% Sr. Nts., 1/15/09                                  357,000         381,990
7.75% Sr. Nts., 8/1/10                                   400,000         439,500
9.875% Sr. Unsec. Nts., 10/15/07                       1,400,000       1,571,500


                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES Continued
CMS Energy X-TRAS Pass-Through
Trust I, 7% Sr. Unsec. Pass-Through
Certificates, 1/15/05                              $     500,000   $     500,000
- --------------------------------------------------------------------------------
ESI Tractebel Acquisition Corp.,
7.99% Sec. Bonds, Series B, 12/30/11 1                   882,000         935,834
- --------------------------------------------------------------------------------
Midwest Generation LLC, 8.75%
Sr. Sec. Nts., 5/1/34                                  3,600,000       4,104,000
- --------------------------------------------------------------------------------
Mirant Americas Generation LLC,
8.30% Sr. Unsec. Nts., 5/1/11 4,5                        200,000         212,500
- --------------------------------------------------------------------------------
MSW Energy Holdings II LLC/MSW
Energy Finance Co. II, Inc., 7.375%
Sr. Sec. Nts., Series B, 9/1/10                          700,000         738,500
- --------------------------------------------------------------------------------
MSW Energy Holdings LLC/MSW
Energy Finance Co., Inc., 8.50%
Sr. Sec. Nts., 9/1/10                                    400,000         440,000
- --------------------------------------------------------------------------------
NRG Energy, Inc., 8% Sr. Sec. Nts.,
12/15/13 3                                             2,500,000       2,737,500
- --------------------------------------------------------------------------------
Reliant Energy, Inc., 6.75% Sr. Sec. Nts.,
12/15/14                                                 900,000         898,875
- --------------------------------------------------------------------------------
Reliant Resources, Inc.:
9.25% Sr. Sec. Nts., 7/15/10                           1,657,000       1,855,840
9.50% Sr. Sec. Nts., 7/15/13                           1,600,000       1,826,000
- --------------------------------------------------------------------------------
Teco Energy, Inc., 7.20% Unsec. Unsub.
Nts., 5/1/11                                           2,000,000       2,200,000
- --------------------------------------------------------------------------------
Texas Genco LLC, 6.875% Sr. Nts.,
12/15/14 3                                             1,100,000       1,142,625
                                                                   -------------
                                                                      24,150,178

- --------------------------------------------------------------------------------
GAS UTILITIES--0.3%
AmeriGas Partners LP/AmeriGas Eagle
Finance Corp., 8.875% Sr. Unsec. Nts.,
Series B, 5/20/11 10                                   1,400,000       1,533,000
- --------------------------------------------------------------------------------
SEMCO Energy, Inc., 7.125% Sr. Nts.,
5/15/08                                                  400,000         430,109
                                                                   -------------
                                                                       1,963,109

- --------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER--1.9%
AES Red Oak LLC:
8.54% Sr. Sec. Bonds, Series A, 11/30/19               1,031,898       1,163,465
9.20% Sr. Sec. Bonds, Series B, 11/30/29                 500,000         563,750
- --------------------------------------------------------------------------------
Consumers Energy Co.:
6.25% Nts., 9/15/06                                      300,000         313,344
6.375% Sr. Sec. Nts., 2/1/08                             450,000         481,506
7.375% Nts., 9/15/23                                     350,000         362,054
- --------------------------------------------------------------------------------
Dynegy Holdings, Inc.:
6.875% Sr. Unsec. Unsub. Nts., 4/1/11                  3,340,000       3,231,450
8.75% Sr. Nts., 2/15/12                                1,857,000       1,954,493
10.125% Sr. Sec. Nts., 7/15/13 3                       1,850,000       2,127,500
- --------------------------------------------------------------------------------
Mirant Mid-Atlantic LLC, 8.625%
Sec. Pass-Through Certificates,
Series A, 6/30/12                                        797,235         885,429


            17 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER Continued
NorthWestern Corp., 5.875%
Sr. Sec. Nts., 11/1/14 3                           $     580,000   $     596,223
                                                                   -------------
                                                                      11,679,214

- --------------------------------------------------------------------------------
WATER UTILITIES--0.1%
National Waterworks, Inc., 10.50%
Sr. Unsec. Sub. Nts., Series B, 12/1/12                  300,000         339,000
                                                                   -------------
Total Corporate Bonds and Notes
(Cost $450,525,393)                                                  478,080,198

                                                          SHARES
- --------------------------------------------------------------------------------
PREFERRED STOCKS--0.6%
- --------------------------------------------------------------------------------
AmeriKing, Inc., 13% Cum. Sr.
Exchangeable, Non-Vtg. 1,5,7                              13,764              --
- --------------------------------------------------------------------------------
Dobson Communications Corp., 6% Cv.,
Series F (converts into Dobson
Communications Corp., Cl. A common
stock), Non-Vtg. 3                                           800          56,071
- --------------------------------------------------------------------------------
e.spire Communications, Inc., 12.75%
Jr. Redeemable, Non-Vtg. 1,5,7                               498              50
- --------------------------------------------------------------------------------
Eagle-Picher Holdings, Inc., 11.75% Cum.
Exchangeable, Series B, Non-Vtg. 1,5                       8,000         698,000
- --------------------------------------------------------------------------------
ICG Holdings, Inc.,
14.25% Exchangeable, Non-Vtg. 1,5,7                          342              --
- --------------------------------------------------------------------------------
McLeodUSA, Inc., 2.50% Cv., Series A 5                     3,258          11,875
- --------------------------------------------------------------------------------
Pacific & Atlantic Holdings, Inc., 7.50%
Cum. Cv., Series A 1,5,7                                  22,013          44,026
- --------------------------------------------------------------------------------
Paxson Communications Corp.:
14.25% Cum. Jr. Exchangeable,
Non-Vtg. 1,7                                                  92         678,500
14.25% Cum. Jr. Exchangeable,
Non-Vtg. 1,5,7                                                --             561
- --------------------------------------------------------------------------------
PTV, Inc., 10% Cum., Series A, Non-Vtg.                       22              75
- --------------------------------------------------------------------------------
Rural Cellular Corp., 11.375% Cum.,
Series B, Non-Vtg. 1,5,7                                   1,177         915,118
- --------------------------------------------------------------------------------
Sovereign Real Estate Investment Trust,
12% Non-Cum., Series A 1                                  10,000       1,517,500
                                                                   -------------
Total Preferred Stocks (Cost $4,490,451)                               3,921,776

- --------------------------------------------------------------------------------
COMMON STOCKS--1.6%
- --------------------------------------------------------------------------------
AboveNet, Inc. 5                                             159           5,088
- --------------------------------------------------------------------------------
Broadwing Corp.                                              460           4,191
- --------------------------------------------------------------------------------
Cebridge Connections Holding LLC 5                         2,645              --
- --------------------------------------------------------------------------------
Charles River Laboratories
International, Inc. 5                                      8,360         384,644
- --------------------------------------------------------------------------------
Chesapeake Energy Corp.                                  100,909       1,664,999
- --------------------------------------------------------------------------------
Covad Communications Group, Inc. 5                        20,660          44,419
- --------------------------------------------------------------------------------
Crunch Equity Holdings, Cl. A 1,5                            301         390,333
- --------------------------------------------------------------------------------
Dobson Communications Corp., Cl. A 5                      43,391          74,633


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS Continued
Globix Corp. 5                                            11,467   $      41,281
- --------------------------------------------------------------------------------
Gulfstream Holding, Inc. 1,5                                  56              --
- --------------------------------------------------------------------------------
Horizon Natural Resources Co. 1,5                         20,000              --
- --------------------------------------------------------------------------------
ICO Global Communication
Holdings Ltd. 5                                           42,107          21,475
- --------------------------------------------------------------------------------
iPCS, Inc. 5                                               9,973         304,177
- --------------------------------------------------------------------------------
Leap Wireless International, Inc. 5                        1,913          51,651
- --------------------------------------------------------------------------------
Magellan Health Services, Inc. 5                           9,965         340,404
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The)                                  1,039          39,118
- --------------------------------------------------------------------------------
MCI, Inc.                                                  1,629          32,841
- --------------------------------------------------------------------------------
NTL, Inc. 5                                               18,902       1,379,090
- --------------------------------------------------------------------------------
Orbital Sciences Corp. 5                                   2,235          26,440
- --------------------------------------------------------------------------------
Pioneer Cos., Inc. 5                                      20,688         429,276
- --------------------------------------------------------------------------------
Polymer Group, Inc., Cl. A 5                              24,040         456,760
- --------------------------------------------------------------------------------
Prandium, Inc. 1,5                                        62,829             691
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. 1,5                                 396          14,751
- --------------------------------------------------------------------------------
Telewest Global, Inc. 5                                   96,326       1,693,411
- --------------------------------------------------------------------------------
Telus Corp.                                                1,079          31,183
- --------------------------------------------------------------------------------
TVMAX Holdings, Inc. 1,5                                   7,500          44,625
- --------------------------------------------------------------------------------
UnitedGlobalCom, Inc., Cl. A 5                           143,824       1,389,340
- --------------------------------------------------------------------------------
Viatel Holding Ltd. (Bermuda) 1,5                          2,701           3,241
- --------------------------------------------------------------------------------
Western Forest Products, Inc. 5                           85,047         472,030
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The)                                 20,000         325,800
- --------------------------------------------------------------------------------
WRC Media Corp. 1,5                                        1,353              27
- --------------------------------------------------------------------------------
XO Communications, Inc. 5                                  2,646           8,044
                                                                   -------------
Total Common Stocks (Cost $8,602,957)                                  9,673,963

                                                           UNITS
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.2%
- --------------------------------------------------------------------------------
American Tower Corp. Wts.,
Exp. 8/1/08 3,5                                            1,400         322,700
- --------------------------------------------------------------------------------
ASAT Finance LLC Wts., Exp. 11/1/06 1,5                      500               4
- --------------------------------------------------------------------------------
Citigroup, Inc. Litigation Wts.,
Exp. 12/31/50 5                                           15,626          22,189
- --------------------------------------------------------------------------------
COLO.com, Inc. Wts., Exp. 3/15/10 1,5                        600               6
- --------------------------------------------------------------------------------
Concentric Network Corp. Wts.,
Exp. 12/15/07 1,5                                            750              --
- --------------------------------------------------------------------------------
Covergent Communications, Inc. Wts.,
Exp. 4/1/08 1,5                                            2,000              20
- --------------------------------------------------------------------------------
DeCrane Aircraft Holdings, Inc. Wts.,
Exp. 9/30/08 1,5                                           1,750              --
- --------------------------------------------------------------------------------
Diva Systems Corp. Wts., Exp. 3/1/08 1,5                   1,500              --
- --------------------------------------------------------------------------------
e.spire Communications, Inc. Wts.,
Exp. 11/1/05 1,5                                             475               5
- --------------------------------------------------------------------------------
Horizon PCS, Inc. Wts., Exp. 10/1/10 1,5                   1,300              --


            18 | OPPENHEIMER HIGH INCOME FUND/VA


                                                                           VALUE
                                                           UNITS      SEE NOTE 1
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES Continued
- --------------------------------------------------------------------------------
Huntsman Co. LLC Wts.,
Exp. 5/15/11 1,5                                           1,000   $     470,500
- --------------------------------------------------------------------------------
ICG Communications, Inc. Wts.,
Exp. 9/15/05 1,5                                           5,940              59
- --------------------------------------------------------------------------------
ICO Global Communication
Holdings Ltd. Wts.:
Exp. 5/16/06 1,5                                          10,561              53
Exp. 5/16/06 1,5                                              16              --
- --------------------------------------------------------------------------------
Imperial Credit Industries, Inc. Wts.,
Exp. 1/31/08 1,5                                           5,148              --
- --------------------------------------------------------------------------------
Insilco Corp. Wts., Exp. 8/15/07 1,5                         765              --
- --------------------------------------------------------------------------------
iPCS, Inc. Wts., Exp. 6/15/10 1,5                            750               8
- --------------------------------------------------------------------------------
Leap Wireless International, Inc. Wts.,
Exp. 4/15/10 1,5                                             550               6
- --------------------------------------------------------------------------------
Long Distance International, Inc. Wts.,
Exp. 4/13/08 1,5                                             800              --
- --------------------------------------------------------------------------------
Loral Space & Communications Ltd. Wts.,
Exp. 1/15/07 1,5                                             800               8
- --------------------------------------------------------------------------------
McLeodUSA, Inc. Wts., Exp. 4/16/07 5                       7,220           1,516
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc. Wts.,
Exp. 7/15/05 1,5                                           1,500              15
- --------------------------------------------------------------------------------
Ntelos, Inc. Wts., Exp. 8/15/10 1,5                        1,000              10
- --------------------------------------------------------------------------------
Pathmark Stores, Inc. Wts., Exp. 9/19/10 5                20,000           4,000
- --------------------------------------------------------------------------------
Protection One, Inc. Wts., Exp. 6/30/05 1,5                1,600              --
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. Wts.,
Exp. 12/19/08 1,5                                            647           3,017
- --------------------------------------------------------------------------------
Transocean, Inc. Wts., Exp. 5/1/09 3,5                     1,000         453,125
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. A Wts.,
Exp. 1/16/10 5                                             5,300           3,578
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. B Wts.,
Exp. 1/16/10 5                                             3,975           1,908
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. C Wts.,
Exp. 1/16/10 5                                             3,975           1,550
                                                                   -------------
Total Rights, Warrants and Certificates
(Cost $256,478)                                                        1,284,277

                                                       PRINCIPAL
                                                          AMOUNT
- --------------------------------------------------------------------------------
STRUCTURED NOTES--7.9%
- --------------------------------------------------------------------------------
Bear Stearns Cos., Inc. (The), High
Yield Index Linked Nts., 0%, 5/8/05 8              $   6,000,000       6,128,400
- --------------------------------------------------------------------------------
Dow Jones CDX High Yield Index
Pass-Through Certificates:
Series 3-1, 7.75%, 12/29/09 3,11                      11,000,000      11,323,125
Series 3-3, 8%, 12/29/09 3,11                         17,400,000      17,867,625
Series 3-4, 10.50%, 12/29/09 3,11                     11,500,000      11,765,938

                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- --------------------------------------------------------------------------------
STRUCTURED NOTES Continued
- --------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.,
High Yield Targeted Return Index
Securities, Series 2004-1,
8.218%, 8/1/15 1,10,11                             $     953,488   $   1,063,481
                                                                   -------------
Total Structured Notes (Cost $46,981,804)                             48,148,569

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--9.6%
- --------------------------------------------------------------------------------
Undivided interest of 4.07% in joint repurchase
agreement (Principal Amount/Value
$1,443,703,000, with a maturity value of
$1,443,962,867) with UBS Warburg LLC, 2.16%,
dated 12/31/04, to be repurchased at $58,766,576
on 1/3/05, collateralized by Federal National
Mortgage Assn., 5%--6%, 4/1/34--10/1/34, with a
value of $1,474,609,071 (Cost $58,756,000)            58,756,000      58,756,000

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $571,908,681)                                         98.2%    602,175,363
- --------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES                              1.8      11,242,358
                                                   -----------------------------
NET ASSETS                                                 100.0%  $ 613,417,721
                                                   =============================

FOOTNOTES TO STATEMENT OF INVESTMENTS

PRINCIPAL AMOUNT IS REPORTED IN U.S. DOLLARS, EXCEPT FOR THOSE DENOTED IN THE
FOLLOWING CURRENCY:

EUR   EURO

1. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of December 31, 2004 was $23,784,798, which represents
3.88% of the Fund's net assets, of which $691 is considered restricted. See Note
8 of Notes to Financial Statements.

2. Represents the current interest rate for a variable or increasing rate
security.

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 $132,039,023 or 21.53% of the Fund's net
assets as of December 31, 2004.

4. Issue is in default. See Note 1 of Notes to Financial Statements.

5. Non-income producing security.

6. Denotes a step bond: a zero coupon bond that converts to a fixed or variable
interest rate at a designated future date.

7. Interest or dividend is paid-in-kind.

8. Zero coupon bond reflects effective yield on the date of purchase.

9. When-issued security or forward commitment to be delivered and settled after
December 31, 2004. See Note 1 of Notes to Financial Statements.

10. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts with an aggregate
market value of $363,592. See Note 6 of Notes to Financial Statements.

11. Interest rate represents a weighted average rate comprised of the interest
rates of the underlying securities.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            19 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- -----------------------------------------------------------------------------------------------------------------------
ASSETS
- -----------------------------------------------------------------------------------------------------------------------
Investments, at value (cost $571,908,681)--see accompanying statement of investments                     $ 602,175,363
- -----------------------------------------------------------------------------------------------------------------------
Cash                                                                                                         1,323,413
- -----------------------------------------------------------------------------------------------------------------------
Cash--foreign currencies (cost $5,025)                                                                           5,025
- -----------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Interest, dividends and principal paydowns                                                                   9,052,296
Shares of beneficial interest sold                                                                           1,245,171
Investments sold                                                                                               225,785
Other                                                                                                            8,576
                                                                                                         --------------
Total assets                                                                                               614,035,629

- -----------------------------------------------------------------------------------------------------------------------
LIABILITIES
- -----------------------------------------------------------------------------------------------------------------------
Unrealized depreciation on swap contracts                                                                       90,514
- -----------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased on a when-issued basis or forward commitment                                             220,000
Shares of beneficial interest redeemed                                                                         153,752
Distribution and service plan fees                                                                              77,618
Shareholder communications                                                                                      26,663
Trustees' compensation                                                                                          12,530
Futures margins                                                                                                  5,000
Transfer and shareholder servicing agent fees                                                                    1,733
Other                                                                                                           30,098
                                                                                                         --------------
Total liabilities                                                                                              617,908

- -----------------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                               $ 613,417,721
                                                                                                         ==============

- -----------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                                               $      69,751
- -----------------------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                                 656,159,098
- -----------------------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                                           37,454,171
- -----------------------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions                            (110,525,544)
- -----------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities denominated in
 foreign currencies                                                                                         30,260,245
                                                                                                         --------------
NET ASSETS                                                                                               $ 613,417,721
                                                                                                         ==============

- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- -----------------------------------------------------------------------------------------------------------------------
Non-Service shares:
Net asset value, redemption price per share and offering price per share
(based on net assets of $479,405,199 and 54,454,794 shares of beneficial interest outstanding)           $        8.80
- -----------------------------------------------------------------------------------------------------------------------
Service shares:
Net asset value, redemption price per share and offering price per share
(based on net assets of $134,012,522 and 15,296,009 shares of beneficial interest outstanding)           $        8.76


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            20 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------



- ---------------------------------------------------------------------------------------
INVESTMENT INCOME
- ---------------------------------------------------------------------------------------
Interest (net of foreign withholding taxes of $617)                       $ 43,139,671
- ---------------------------------------------------------------------------------------
Portfolio lending fees                                                           6,683
                                                                          -------------
Total investment income                                                     43,146,354

- ---------------------------------------------------------------------------------------
EXPENSES
- ---------------------------------------------------------------------------------------
Management fees                                                              4,058,869
- ---------------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                             253,266
- ---------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                              10,157
Service shares                                                                  10,042
- ---------------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                              52,908
Service shares                                                                  12,135
- ---------------------------------------------------------------------------------------
Custodian fees and expenses                                                     19,333
- ---------------------------------------------------------------------------------------
Trustees' compensation                                                          16,825
- ---------------------------------------------------------------------------------------
Other                                                                           56,941
                                                                          -------------
Total expenses                                                               4,490,476
Less reduction to custodian expenses                                           (14,793)
                                                                          -------------
Net expenses                                                                 4,475,683

- ---------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                       38,670,671

- ---------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- ---------------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments                                                                   (613,058)
Closing of futures contracts                                                    64,322
Foreign currency transactions                                                  327,659
Swap contracts                                                                (461,773)
                                                                          -------------
Net realized loss                                                             (682,850)
- ---------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                                 10,248,803
Translation of assets and liabilities denominated in foreign currencies         45,315
Futures contracts                                                               76,370
Swap contracts                                                                 (90,514)
                                                                          -------------
Net change in unrealized appreciation                                       10,279,974

- ---------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                      $ 48,267,795
                                                                          =============


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            21 | OPPENHEIMER HIGH INCOME FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                               2004           2003
- --------------------------------------------------------------------------------------------------------------------------

OPERATIONS
- --------------------------------------------------------------------------------------------------------------------------
Net investment income                                                                         $ 38,670,671   $ 36,198,271
- --------------------------------------------------------------------------------------------------------------------------
Net realized loss                                                                                 (682,850)    (3,373,657)
- --------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                                            10,279,974     60,265,270
                                                                                              ----------------------------
Net increase in net assets resulting from operations                                            48,267,795     93,089,884

- --------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                                             (29,416,204)   (26,819,814)
Service shares                                                                                  (5,469,874)    (1,672,018)

- --------------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- --------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares                                                                             (10,547,360)    76,658,765
Service shares                                                                                  54,117,983     51,833,851

- --------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- --------------------------------------------------------------------------------------------------------------------------
Total increase                                                                                  56,952,340    193,090,668
- --------------------------------------------------------------------------------------------------------------------------
Beginning of period                                                                            556,465,381    363,374,713
                                                                                              ----------------------------
End of period (including accumulated net investment income of $37,454,171 and
$33,660,739, respectively)                                                                    $613,417,721   $556,465,381
                                                                                              ============================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            22 | OPPENHEIMER HIGH INCOME FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                2004            2003            2002            2001            2000
- ----------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $        8.61     $      7.51     $      8.54     $      9.27     $     10.72
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                       .58 1           .60             .58             .84            1.00
Net realized and unrealized gain (loss)                     .15            1.09            (.76)           (.62)          (1.36)
                                                  --------------------------------------------------------------------------------
Total from investment operations                            .73            1.69            (.18)            .22            (.36)
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                       (.54)           (.59)           (.85)           (.95)          (1.09)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $        8.80     $      8.61     $      7.51     $      8.54     $      9.27
                                                  ================================================================================

- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                         8.97%          23.96%          (2.40)%          1.97%          (3.74)%
- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $     479,405     $   480,112     $   345,670     $   344,788     $   333,533
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $     460,877     $   396,858     $   335,894     $   347,723     $   329,260
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                      6.91%           8.31%           8.29%           9.94%          10.47%
Total expenses                                             0.75% 4         0.76% 4         0.77% 4         0.79% 4         0.79% 4
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                      51%             48%             75%             46%             31%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            23 | OPPENHEIMER HIGH INCOME FUND/VA


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------



SERVICE SHARES  YEAR ENDED DECEMBER 31,                   2004             2003             2002             2001 1
- ----------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $       8.58     $       7.49     $       8.54       $       8.40
- ----------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                      .56 2            .61              .88                .20
Net realized and unrealized gain (loss)                    .15             1.06            (1.08)              (.06)
                                                  --------------------------------------------------------------------
Total from investment operations                           .71             1.67             (.20)               .14
- ----------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.53)            (.58)            (.85)                --
- ----------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $       8.76     $       8.58     $       7.49       $       8.54
                                                  ====================================================================

- ----------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                        8.73%           23.79%           (2.67)%             1.67%
- ----------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $    134,013     $     76,354     $     17,705       $          3
- ----------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $    101,464     $     41,246     $      5,602       $          2
- ----------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                     6.63%            7.84%            8.91%             12.51%
Total expenses                                            1.01% 5          1.04% 5          1.02% 5,6          0.96% 5
- ----------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                     51%              48%              75%                46%


1. For the period from September 18, 2001 (inception of offering) to December
31, 2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

6. Voluntary waiver of transfer agent fees less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            24 | OPPENHEIMER HIGH INCOME FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer High Income Fund/VA (the Fund) is a separate series of Oppenheimer
Variable Account Funds (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek a high level of current income from investment
in high-yield fixed-income securities. The Trust's investment advisor is
OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
STRUCTURED NOTES. The Fund invests in structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss when
a structured note is sold or matures. As of December 31, 2004, the market value
of these securities comprised 7.9% of the Fund's net assets and resulted in
unrealized cumulative gains of $1,166,765.

- --------------------------------------------------------------------------------
SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment
for securities that have been purchased by the Fund on a when-issued basis or
forward commitment can take place up to ten days or more after the trade date.
Normally the settlement date occurs within six months after the trade date;
however, the Fund may, from time to time, purchase securities whose settlement
date extends six months or more beyond trade date. During this period, such
securities do not earn interest, are subject to market fluctuation and may
increase or decrease in value prior to their delivery. The Fund maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The purchase of securities on a when-issued
basis or forward


            25 | OPPENHEIMER HIGH INCOME FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

commitment may increase the volatility of the Fund's net asset value to the
extent the Fund executes such transactions while remaining substantially fully
invested. The Fund may also sell securities that it purchased on a when-issued
basis or forward commitment prior to settlement of the original purchase. As of
December 31, 2004, the Fund had purchased $220,000 of securities on a
when-issued basis or forward commitment.

- --------------------------------------------------------------------------------
SECURITY CREDIT RISK. The Fund invests in high-yield securities, which may be
subject to a greater degree of credit risk, market fluctuations and loss of
income and principal, and may be more sensitive to economic conditions than
lower-yielding, higher-rated fixed-income securities. The Fund may acquire
securities in default, and is not obligated to dispose of securities whose
issuers subsequently default. As of December 31, 2004, securities with an
aggregate market value of $6,822,262, representing 1.11% of the Fund's net
assets, were in default.

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.


            26 | OPPENHEIMER HIGH INCOME FUND/VA


                                                                 NET UNREALIZED
                                                                   APPRECIATION
                                                               BASED ON COST OF
                                                                 SECURITIES AND
 UNDISTRIBUTED     UNDISTRIBUTED             ACCUMULATED      OTHER INVESTMENTS
 NET INVESTMENT        LONG-TERM                    LOSS     FOR FEDERAL INCOME
 INCOME                     GAIN    CARRYFORWARD 1,2,3,4           TAX PURPOSES
 ------------------------------------------------------------------------------
 $37,883,370                 $--            $108,492,664            $28,050,771

1. As of December 31, 2004, the Fund had $107,323,569 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

                          EXPIRING
                          -------------------------
                          2006        $   3,401,577
                          2007            4,933,260
                          2008           11,572,833
                          2009           22,696,701
                          2010           56,061,391
                          2011            8,529,303
                          2012              128,504
                                      -------------
                          Total       $ 107,323,569
                                      =============

2. As of December 31, 2004, the Fund had $1,169,095 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

3. During the fiscal year ended December 31, 2004, the Fund did not utilize any
capital loss carryforward.

4. During the fiscal year ended December 31, 2003, the Fund did not utilize any
capital loss carryforward.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

      INCREASE TO                         INCREASE TO
      ACCUMULATED                     ACCUMULATED NET
      NET INVESTMENT                    REALIZED LOSS
      INCOME                           ON INVESTMENTS
      -----------------------------------------------
      $8,839                                   $8,839

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                         YEAR ENDED              YEAR ENDED
                                  DECEMBER 31, 2004       DECEMBER 31, 2003
   ------------------------------------------------------------------------
   Distributions paid from:
   Ordinary income                      $34,886,078             $28,491,832

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

            Federal tax cost of securities           $  573,928,234
            Federal tax cost of other investments         6,176,172
                                                     ---------------
            Total federal tax cost                   $  580,104,406
                                                     ===============

            Gross unrealized appreciation            $   42,282,791
            Gross unrealized depreciation               (14,232,020)
                                                     ---------------
            Net unrealized appreciation              $   28,050,771
                                                     ===============


            27 | OPPENHEIMER HIGH INCOME FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                                                     YEAR ENDED DECEMBER 31, 2004       YEAR ENDED DECEMBER 31, 2003
                                                         SHARES            AMOUNT           SHARES            AMOUNT
- ---------------------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                                 23,243,919     $ 196,620,675       28,774,062     $ 229,684,313
Dividends and/or distributions reinvested             3,591,722        29,416,204        3,719,807        26,819,814
Redeemed                                            (28,128,136)     (236,584,239)     (22,801,608)     (179,845,362)
                                                   ------------------------------------------------------------------
Net increase (decrease)                              (1,292,495)    $ (10,547,360)       9,692,261     $  76,658,765
                                                   ==================================================================



            28 | OPPENHEIMER HIGH INCOME FUND/VA



                                                     YEAR ENDED DECEMBER 31, 2004       YEAR ENDED DECEMBER 31, 2003
                                                         SHARES            AMOUNT           SHARES            AMOUNT
- ---------------------------------------------------------------------------------------------------------------------

SERVICE SHARES
Sold                                                 12,247,468     $ 103,415,502       13,073,333     $ 104,602,083
Dividends and/or distributions reinvested               669,507         5,469,874          232,224         1,672,018
Redeemed                                             (6,517,361)      (54,767,393)      (6,772,325)      (54,440,250)
                                                   ------------------------------------------------------------------
Net increase                                          6,399,614     $  54,117,983        6,533,232     $  51,833,851
                                                   ==================================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$314,901,839 and $240,904,813, respectively.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% on the next $200 million and 0.50% of average annual
net assets over $1 billion.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$20,130 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees for all classes to 0.35% of average annual
net assets per class. This undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.


            29 | OPPENHEIMER HIGH INCOME FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS Continued

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.

- --------------------------------------------------------------------------------
6. FUTURES CONTRACTS

A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures) or debt securities (interest rate futures) in order to gain
exposure to or protection from changes in market value of stocks and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.

      The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it may
be more efficient or cost effective than actually buying securities.

      Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.

      Cash held by the broker to cover initial margin requirements on open
futures contracts is noted in the Statement of Assets and Liabilities.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable and/or payable for the
daily mark to market for variation margin. Realized gains and losses are
reported in the Statement of Operations as the closing and expiration of futures
contracts. The net change in unrealized appreciation and depreciation is
reported in the Statement of Operations.

      Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.

As of December 31, 2004, the Fund had outstanding futures contracts as follows:



                                    EXPIRATION    NUMBER OF     VALUATION AS OF     UNREALIZED
CONTRACT DESCRIPTION                      DATE    CONTRACTS   DECEMBER 31, 2004   APPRECIATION
- ----------------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
Standard & Poor's 500 Index            3/17/05           20          $6,068,500        $82,250


- --------------------------------------------------------------------------------
7. INTEREST RATE SWAP CONTRACTS

The Fund may enter into an interest rate swap transaction to maintain a total
return or yield spread on a particular investment, or portion of its portfolio,
or for other non-speculative purposes. Interest rate swaps involve the exchange
of commitments to pay or receive interest, e.g., an exchange of floating rate
payments for fixed rate payments. The coupon payments are based on an agreed
upon principal amount and a specified index. Because the principal amount


            30 | OPPENHEIMER HIGH INCOME FUND/VA


is not exchanged, it represents neither an asset nor a liability to either
counterparty, and is referred to as notional. The Fund records an increase or
decrease to unrealized gain (loss), in the amount due to or owed by the Fund at
termination or settlement.

      Interest rate swaps are subject to credit risk (if the counterparty fails
to meet its obligations) and interest rate risk. The Fund could be obligated to
pay more under its swap agreements than it receives under them, as a result of
interest rate changes.

As of December 31, 2004, the Fund had entered into the following interest rate
swap agreements:



                                           FIXED RATE    FLOATING RATE
                                              PAID BY      RECEIVED BY
                             NOTIONAL     THE FUND AT      THE FUND AT       FLOATING   TERMINATION      UNREALIZED
SWAP COUNTERPARTY              AMOUNT   DEC. 31, 2004    DEC. 31, 2004     RATE INDEX          DATE    DEPRECIATION
- -------------------------------------------------------------------------------------------------------------------

                                                                          Three-Month
Deutshe Bank AG           $20,000,000           4.11%            2.41%     LIBOR flat       12/2/09         $90,514


Index abbreviation is as follows:
LIBOR London-Interbank Offered Rate

- --------------------------------------------------------------------------------
8. ILLIQUID OR RESTRICTED SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 15% of
its net assets (determined at the time of purchase and reviewed periodically) in
illiquid or restricted securities. Certain restricted securities, eligible for
resale to qualified institutional investors, are not subject to that limitation.
Information concerning restricted securities is as follows:



                       Acquisition                    Valuation as of       Unrealized
Security                     Dates         Cost     December 31, 2004     Depreciation
- --------------------------------------------------------------------------------------

Prandium, Inc.     3/19/99-7/19/02     $738,000                  $691         $737,309


- --------------------------------------------------------------------------------
9. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had no securities on loan.

- --------------------------------------------------------------------------------
10. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,

            31 | OPPENHEIMER HIGH INCOME FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
10. LITIGATION Continued

consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.






REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER MAIN STREET SMALL CAP
FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Main Street Small Cap Fund/VA, a series of Oppenheimer Variable
Account Funds, including the statement of investments, as of December 31, 2004,
and the related statement of operations for the year then ended, the statements
of changes in net assets for each of the two years in the period then ended, and
the financial highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Main Street Small Cap Fund/VA as of December 31, 2004, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the financial highlights for
the periods presented, in conformity with accounting principles generally
accepted in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005


STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMON STOCKS--98.5%
- ---------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--16.4%
- ---------------------------------------------------------------------------------
AUTO COMPONENTS--1.0%
Aftermarket Technology Corp. 1                             2,400   $      38,640
- ---------------------------------------------------------------------------------
ArvinMeritor, Inc.                                        10,700         239,359
- ---------------------------------------------------------------------------------
Autoliv, Inc.                                              4,200         202,860
- ---------------------------------------------------------------------------------
Collins & Aikman Corp. 1                                   7,600          33,136
- ---------------------------------------------------------------------------------
Cooper Tire & Rubber Co.                                   5,200         112,060
- ---------------------------------------------------------------------------------
Dana Corp.                                                 5,100          88,383
- ---------------------------------------------------------------------------------
Drew Industries, Inc. 1                                    2,700          97,659
- ---------------------------------------------------------------------------------
Dura Automotive Systems, Inc. 1                              500           5,415
- ---------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. 1                              21,400         313,724
- ---------------------------------------------------------------------------------
Keystone Automotive Industries, Inc. 1                     1,100          25,575
- ---------------------------------------------------------------------------------
Midas, Inc. 1                                             11,900         238,000
- ---------------------------------------------------------------------------------
Modine Manufacturing Co.                                     200           6,754
- ---------------------------------------------------------------------------------
Shiloh Industries, Inc. 1                                  2,900          40,600
- ---------------------------------------------------------------------------------
Spartan Motors, Inc.                                       2,700          32,211
- ---------------------------------------------------------------------------------
Standard Motor Products, Inc.                              5,600          88,480
- ---------------------------------------------------------------------------------
Stoneridge, Inc. 1                                         1,900          28,747
- ---------------------------------------------------------------------------------
Tenneco Automotive, Inc. 1                                16,100         277,564
- ---------------------------------------------------------------------------------
Visteon Corp.                                             26,500         258,905
                                                                   --------------
                                                                       2,128,072

- ---------------------------------------------------------------------------------
AUTOMOBILES--0.3%
Monaco Coach Corp.                                         7,200         148,104
- ---------------------------------------------------------------------------------
Thor Industries, Inc.                                      2,600          96,330
- ---------------------------------------------------------------------------------
Winnebago Industries, Inc.                                 8,100         316,386
                                                                   --------------
                                                                         560,820

- ---------------------------------------------------------------------------------
DISTRIBUTORS--0.4%
Andersons, Inc. (The)                                        500          12,750
- ---------------------------------------------------------------------------------
BlueLinx Holdings, Inc. 1                                 14,000         202,580
- ---------------------------------------------------------------------------------
Handleman Co.                                             12,000         257,760
- ---------------------------------------------------------------------------------
WESCO International, Inc. 1                                9,200         272,688
                                                                   --------------
                                                                         745,778

- ---------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--3.0%
AFC Enterprises, Inc. 1                                      600          14,226
- ---------------------------------------------------------------------------------
Ambassadors Group, Inc.                                    4,100         146,001
- ---------------------------------------------------------------------------------
Ameristar Casinos, Inc.                                    6,300         271,593
- ---------------------------------------------------------------------------------
Applebee's International, Inc.                             1,450          38,353
- ---------------------------------------------------------------------------------
Argosy Gaming Co. 1                                        4,700         219,490
- ---------------------------------------------------------------------------------
Aztar Corp. 1                                              4,400         153,648
- ---------------------------------------------------------------------------------
Bally Total Fitness Holding Corp. 1                        2,800          11,872
- ---------------------------------------------------------------------------------
BJ's Restaurants, Inc. 1                                   2,200          30,800
- ---------------------------------------------------------------------------------
Bluegreen Corp. 1                                         13,900         275,637
- ---------------------------------------------------------------------------------
Caesars Entertainment, Inc. 1                              5,200         104,728
- ---------------------------------------------------------------------------------
California Pizza Kitchen, Inc. 1                           9,100         209,300


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

HOTELS, RESTAURANTS & LEISURE Continued
CBRL Group, Inc.                                           3,900   $     163,215
- ---------------------------------------------------------------------------------
CEC Entertainment, Inc. 1                                 13,950         557,582
- ---------------------------------------------------------------------------------
Checkers Drive-In Restaurants, Inc. 1                      2,200          29,480
- ---------------------------------------------------------------------------------
Choice Hotels International, Inc.                          3,200         185,600
- ---------------------------------------------------------------------------------
Ctrip.com International Ltd., ADR 1                        2,800         128,856
- ---------------------------------------------------------------------------------
Dave & Buster's, Inc. 1                                   10,900         220,180
- ---------------------------------------------------------------------------------
Domino's Pizza, Inc.                                       5,300          94,340
- ---------------------------------------------------------------------------------
Dover Downs Gaming & Entertainment, Inc.                   3,500          45,850
- ---------------------------------------------------------------------------------
Frisch's Restaurants, Inc.                                   100           2,383
- ---------------------------------------------------------------------------------
Gaylord Entertainment Co., Cl. A 1                         6,100         253,333
- ---------------------------------------------------------------------------------
Great Wolf Resorts, Inc. 1                                10,100         225,634
- ---------------------------------------------------------------------------------
Isle of Capri Casinos, Inc. 1                             14,400         369,360
- ---------------------------------------------------------------------------------
Jack in the Box, Inc. 1                                   13,800         508,806
- ---------------------------------------------------------------------------------
La Quinta Corp. 1                                         38,000         345,420
- ---------------------------------------------------------------------------------
Landry's Restaurants, Inc.                                 2,100          61,026
- ---------------------------------------------------------------------------------
Lone Star Steakhouse & Saloon, Inc.                        2,400          67,200
- ---------------------------------------------------------------------------------
Monarch Casino & Resort, Inc. 1                            3,400         137,870
- ---------------------------------------------------------------------------------
Navigant International, Inc. 1                             4,900          59,633
- ---------------------------------------------------------------------------------
O'Charley's, Inc. 1                                          800          15,640
- ---------------------------------------------------------------------------------
Outback Steakhouse, Inc.                                     800          36,624
- ---------------------------------------------------------------------------------
P.F. Chang's China Bistro, Inc. 1                          2,500         140,875
- ---------------------------------------------------------------------------------
Papa John's International, Inc. 1                          4,600         158,424
- ---------------------------------------------------------------------------------
Pinnacle Entertainment, Inc. 1                             6,500         128,570
- ---------------------------------------------------------------------------------
Rare Hospitality International, Inc. 1                     2,450          78,057
- ---------------------------------------------------------------------------------
Red Robin Gourmet Burgers, Inc. 1                            800          42,776
- ---------------------------------------------------------------------------------
Ryan's Restaurant Group, Inc. 1                            3,200          49,344
- ---------------------------------------------------------------------------------
Scientific Games Corp., Cl. A 1                            2,000          47,680
- ---------------------------------------------------------------------------------
Six Flags, Inc. 1                                         40,600         218,022
- ---------------------------------------------------------------------------------
Sonic Corp. 1                                              7,050         215,025
- ---------------------------------------------------------------------------------
Speedway Motorsports, Inc.                                 1,200          47,016
- ---------------------------------------------------------------------------------
Steak n Shake Co. (The) 1                                  5,500         110,440
- ---------------------------------------------------------------------------------
The9 Ltd., ADR 1                                           4,100          96,842
- ---------------------------------------------------------------------------------
Vail Resorts, Inc. 1                                       3,900          87,438
                                                                   --------------
                                                                       6,404,189

- ---------------------------------------------------------------------------------
HOUSEHOLD DURABLES--2.2%
American Greetings Corp., Cl. A                           19,600         496,860
- ---------------------------------------------------------------------------------
Avatar Holdings, Inc. 1                                      300          14,430
- ---------------------------------------------------------------------------------
Bassett Furniture Industries, Inc.                           900          17,663
- ---------------------------------------------------------------------------------
Beazer Homes USA, Inc.                                     1,600         233,936
- ---------------------------------------------------------------------------------
Black & Decker Corp.                                       2,300         203,159
- ---------------------------------------------------------------------------------
Blount International, Inc. 1                              11,700         203,814
- ---------------------------------------------------------------------------------
Brookfield Homes Corp.                                     1,700          57,630
- ---------------------------------------------------------------------------------
Champion Enterprises, Inc. 1                               3,100          36,642
- ---------------------------------------------------------------------------------
Chromcraft Revington, Inc. 1                                 600           7,380



                  7 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

HOUSEHOLD DURABLES Continued
Comstock Homebuilding Cos., Inc., Cl. A 1                  6,000   $     130,620
- ---------------------------------------------------------------------------------
CSS Industries, Inc.                                       4,100         130,216
- ---------------------------------------------------------------------------------
Enesco Group, Inc. 1                                         200           1,616
- ---------------------------------------------------------------------------------
Ethan Allen Interiors, Inc.                                6,700         268,134
- ---------------------------------------------------------------------------------
Furniture Brands International, Inc.                      15,600         390,780
- ---------------------------------------------------------------------------------
Interface, Inc., Cl. A 1                                   3,000          29,910
- ---------------------------------------------------------------------------------
KB Home                                                      600          62,640
- ---------------------------------------------------------------------------------
Kimball International, Inc., Cl. B                         3,700          54,797
- ---------------------------------------------------------------------------------
La-Z-Boy, Inc.                                             3,500          53,795
- ---------------------------------------------------------------------------------
Leggett & Platt, Inc.                                      3,100          88,133
- ---------------------------------------------------------------------------------
Levitt Corp., Cl. A                                        1,800          55,026
- ---------------------------------------------------------------------------------
M.D.C. Holdings, Inc.                                        580          50,135
- ---------------------------------------------------------------------------------
Maytag Corp.                                               2,400          50,640
- ---------------------------------------------------------------------------------
Meritage Homes Corp. 1                                     3,500         394,450
- ---------------------------------------------------------------------------------
Mestek, Inc. 1                                               700          12,670
- ---------------------------------------------------------------------------------
Movado Group, Inc.                                           600          11,190
- ---------------------------------------------------------------------------------
National Presto Industries, Inc.                             300          13,650
- ---------------------------------------------------------------------------------
Ryland Group, Inc. (The)                                   3,100         178,374
- ---------------------------------------------------------------------------------
Snap-On, Inc.                                              4,400         151,184
- ---------------------------------------------------------------------------------
Standard Pacific Corp.                                     1,800         115,452
- ---------------------------------------------------------------------------------
Stanley Furniture Co., Inc.                                3,600         161,820
- ---------------------------------------------------------------------------------
Stanley Works (The)                                        3,700         181,263
- ---------------------------------------------------------------------------------
Technical Olympic USA, Inc.                                6,600         167,508
- ---------------------------------------------------------------------------------
Tupperware Corp.                                          12,300         254,856
- ---------------------------------------------------------------------------------
Universal Electronics, Inc. 1                              5,000          88,000
- ---------------------------------------------------------------------------------
Whirlpool Corp.                                            1,400          96,894
- ---------------------------------------------------------------------------------
Yankee Candle, Inc. (The) 1                                6,100         202,398
                                                                   --------------
                                                                       4,667,665

- ---------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL--0.3%
1-800-FLOWERS.com, Inc. 1                                  2,500          21,025
- ---------------------------------------------------------------------------------
Audible, Inc. 1                                            5,600         145,880
- ---------------------------------------------------------------------------------
GSI Commerce, Inc. 1                                       3,100          55,118
- ---------------------------------------------------------------------------------
Insight Enterprises, Inc. 1                               13,100         268,812
- ---------------------------------------------------------------------------------
J. Jill Group, Inc. 1                                      4,000          59,560
- ---------------------------------------------------------------------------------
Provide Commerce, Inc. 1                                   1,800          66,870
- ---------------------------------------------------------------------------------
ValueVision Media, Inc., Cl. A 1                           8,300         115,453
                                                                   --------------
                                                                         732,718

- ---------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--1.1%
Action Performance Cos., Inc.                             10,300         113,197
- ---------------------------------------------------------------------------------
Arctic Cat, Inc.                                           2,600          68,952
- ---------------------------------------------------------------------------------
Callaway Golf Co.                                          8,400         113,400
- ---------------------------------------------------------------------------------
Hasbro, Inc.                                               6,300         122,094
- ---------------------------------------------------------------------------------
JAKKS Pacific, Inc. 1                                      5,500         121,605
- ---------------------------------------------------------------------------------
Marine Products Corp.                                      1,000          26,110


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

LEISURE EQUIPMENT & PRODUCTS Continued
MarineMax, Inc. 1                                          1,800   $      53,568
- ---------------------------------------------------------------------------------
Marvel Enterprises, Inc. 1                                16,400         335,872
- ---------------------------------------------------------------------------------
Nautilus Group, Inc. (The)                                22,100         534,157
- ---------------------------------------------------------------------------------
Oakley, Inc.                                                 500           6,375
- ---------------------------------------------------------------------------------
Polaris Industries, Inc.                                   1,900         129,238
- ---------------------------------------------------------------------------------
RC2 Corp. 1                                                7,700         251,020
- ---------------------------------------------------------------------------------
SCP Pool Corp.                                            11,012         351,283
- ---------------------------------------------------------------------------------
Steinway Musical Instruments, Inc. 1                       4,600         133,124
                                                                   --------------
                                                                       2,359,995

- ---------------------------------------------------------------------------------
MEDIA--1.5%
4Kids Entertainment, Inc. 1                                5,900         124,018
- ---------------------------------------------------------------------------------
Advo, Inc.                                                 1,850          65,953
- ---------------------------------------------------------------------------------
Beasley Broadcast Group, Inc., Cl. A 1                       100           1,753
- ---------------------------------------------------------------------------------
Carmike Cinemas, Inc.                                        800          29,200
- ---------------------------------------------------------------------------------
Catalina Marketing Corp.                                  14,000         414,820
- ---------------------------------------------------------------------------------
Charter Communications, Inc., Cl. A 1                     47,800         107,072
- ---------------------------------------------------------------------------------
Entravision Communications Corp. 1                         5,400          45,090
- ---------------------------------------------------------------------------------
Gemstar-TV Guide International, Inc. 1                    10,600          62,752
- ---------------------------------------------------------------------------------
Getty Images, Inc. 1                                       1,900         130,815
- ---------------------------------------------------------------------------------
Gray Television, Inc.                                      2,100          32,550
- ---------------------------------------------------------------------------------
Harte-Hanks, Inc.                                          1,100          28,578
- ---------------------------------------------------------------------------------
Hearst-Argyle Television, Inc.                             1,400          36,932
- ---------------------------------------------------------------------------------
Hollinger International, Inc.                              1,600          25,088
- ---------------------------------------------------------------------------------
Insight Communications Co., Inc. 1                         4,700          43,569
- ---------------------------------------------------------------------------------
Lakes Gaming, Inc. 1                                       3,100          50,499
- ---------------------------------------------------------------------------------
Lin TV Corp. 1                                             3,200          61,120
- ---------------------------------------------------------------------------------
Martha Stewart Living Omnimedia,
Inc., Cl. A 1                                              7,300         211,846
- ---------------------------------------------------------------------------------
Media General, Inc., Cl. A                                   400          25,924
- ---------------------------------------------------------------------------------
Mediacom Communications Corp. 1                           28,500         178,125
- ---------------------------------------------------------------------------------
Meredith Corp.                                             1,800          97,560
- ---------------------------------------------------------------------------------
New Frontier Media, Inc. 1                                   700           5,543
- ---------------------------------------------------------------------------------
Playboy Enterprises, Inc., Cl. B 1                         2,500          30,725
- ---------------------------------------------------------------------------------
PRIMEDIA, Inc. 1                                           4,100          15,580
- ---------------------------------------------------------------------------------
ProQuest Co. 1                                               800          23,760
- ---------------------------------------------------------------------------------
Pulitzer, Inc.                                               100           6,485
- ---------------------------------------------------------------------------------
R.H. Donnelley Corp. 1                                     3,700         218,485
- ---------------------------------------------------------------------------------
Radio One, Inc., Cl. D 1                                   3,600          58,032
- ---------------------------------------------------------------------------------
Readers Digest Assn., Inc. (The), Cl. A, Non-Vtg          14,500         201,695
- ---------------------------------------------------------------------------------
Salem Communications Corp., Cl. A 1                        7,500         187,125
- ---------------------------------------------------------------------------------
Thomas Nelson, Inc.                                        5,200         117,520
- ---------------------------------------------------------------------------------
TiVo, Inc. 1                                              12,200          71,614
- ---------------------------------------------------------------------------------
Westwood One, Inc. 1                                       3,900         105,027
- ---------------------------------------------------------------------------------
Wiley (John) & Sons, Inc., Cl. A                           2,400          83,616



                  8 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

MEDIA Continued
World Wrestling Federation Entertainment, Inc.            12,600   $     152,838
- ---------------------------------------------------------------------------------
WPT Enterprises, Inc. 1                                    1,500          25,500
                                                                   --------------
                                                                       3,076,809

- ---------------------------------------------------------------------------------
MULTILINE RETAIL--0.5%
Big Lots, Inc. 1                                           4,200          50,946
- ---------------------------------------------------------------------------------
Dillard's, Inc., Cl. A                                     9,700         260,639
- ---------------------------------------------------------------------------------
Shopko Stores, Inc. 1                                     11,700         218,556
- ---------------------------------------------------------------------------------
Stage Stores, Inc. 1                                       6,500         269,880
- ---------------------------------------------------------------------------------
Stein Mart, Inc. 1                                        20,900         356,554
                                                                   --------------
                                                                       1,156,575

- ---------------------------------------------------------------------------------
SPECIALTY RETAIL--5.0%
A.C. Moore Arts & Crafts, Inc. 1                           1,100          31,691
- ---------------------------------------------------------------------------------
Aaron Rents, Inc.                                          8,400         210,000
- ---------------------------------------------------------------------------------
Abercrombie & Fitch Co., Cl. A                             4,500         211,275
- ---------------------------------------------------------------------------------
Aeropostale, Inc. 1                                       12,550         369,347
- ---------------------------------------------------------------------------------
American Eagle Outfitters, Inc.                            3,900         183,690
- ---------------------------------------------------------------------------------
AnnTaylor Stores Corp. 1                                   2,950          63,514
- ---------------------------------------------------------------------------------
AutoNation, Inc. 1                                         2,300          44,183
- ---------------------------------------------------------------------------------
Barnes & Noble, Inc. 1                                     8,800         283,976
- ---------------------------------------------------------------------------------
bebe stores, inc                                           4,575         123,434
- ---------------------------------------------------------------------------------
Big 5 Sporting Goods Corp.                                 8,100         236,034
- ---------------------------------------------------------------------------------
Blair Corp.                                                3,000         106,980
- ---------------------------------------------------------------------------------
Borders Group, Inc.                                       12,500         317,500
- ---------------------------------------------------------------------------------
Brookstone, Inc. 1                                         7,675         150,046
- ---------------------------------------------------------------------------------
Buckle, Inc. (The)                                         2,600          76,700
- ---------------------------------------------------------------------------------
Build-A-Bear-Workshop, Inc. 1                              2,700          94,905
- ---------------------------------------------------------------------------------
Building Materials Holding Corp.                           8,200         313,978
- ---------------------------------------------------------------------------------
Burlington Coat Factory Warehouse Corp.                    5,500         124,850
- ---------------------------------------------------------------------------------
Casual Male Retail Group, Inc. 1                           3,400          18,530
- ---------------------------------------------------------------------------------
Cato Corp., Cl. A                                          8,700         250,734
- ---------------------------------------------------------------------------------
Charlotte Russe Holding, Inc. 1                            6,700          67,670
- ---------------------------------------------------------------------------------
Charming Shoppes, Inc. 1                                  55,900         523,783
- ---------------------------------------------------------------------------------
Children's Place Retail Stores, Inc. 1                     7,000         259,210
- ---------------------------------------------------------------------------------
Christopher & Banks Corp.                                  3,500          64,575
- ---------------------------------------------------------------------------------
Circuit City Stores, Inc./
Circuit City Group                                        12,300         192,372
- ---------------------------------------------------------------------------------
Claire's Stores, Inc.                                     11,800         250,750
- ---------------------------------------------------------------------------------
CSK Auto Corp. 1                                           6,000         100,440
- ---------------------------------------------------------------------------------
Deb Shops, Inc.                                              200           5,008
- ---------------------------------------------------------------------------------
Dress Barn, Inc. (The) 1                                  12,200         214,720
- ---------------------------------------------------------------------------------
Electronics Boutique Holdings Corp. 1                      9,300         399,342
- ---------------------------------------------------------------------------------
Finish Line, Inc. (The), Cl. A                            13,600         248,880
- ---------------------------------------------------------------------------------
Finlay Enterprises, Inc. 1                                 1,300          25,727


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

SPECIALTY RETAIL Continued
GameStop Corp. 1                                          15,100   $     337,636
- ---------------------------------------------------------------------------------
GameStop Corp., Cl. B 1                                      467          10,465
- ---------------------------------------------------------------------------------
Genesco, Inc. 1                                            3,000          93,420
- ---------------------------------------------------------------------------------
Goody's Family Clothing, Inc.                             12,300         112,422
- ---------------------------------------------------------------------------------
Guess?, Inc. 1                                            18,000         225,900
- ---------------------------------------------------------------------------------
Haverty Furniture Cos., Inc.                               4,900          90,650
- ---------------------------------------------------------------------------------
Hibbett Sporting Goods, Inc. 1                             9,225         245,477
- ---------------------------------------------------------------------------------
Hollywood Entertainment Corp. 1                            3,800          49,742
- ---------------------------------------------------------------------------------
Hot Topic, Inc. 1                                          2,100          36,099
- ---------------------------------------------------------------------------------
Jo-Ann Stores, Inc. 1                                      1,900          52,326
- ---------------------------------------------------------------------------------
Jos. A. Banks Clothiers, Inc. 1                            1,625          45,988
- ---------------------------------------------------------------------------------
Men's Wearhouse, Inc. (The) 1                              9,800         313,208
- ---------------------------------------------------------------------------------
Michaels Stores, Inc.                                      6,700         200,799
- ---------------------------------------------------------------------------------
Movie Gallery, Inc.                                        6,500         123,955
- ---------------------------------------------------------------------------------
NetFlix.com, Inc. 1                                          600           7,398
- ---------------------------------------------------------------------------------
Office Depot, Inc. 1                                      12,300         213,528
- ---------------------------------------------------------------------------------
Pacific Sunwear of California, Inc. 1                     17,875         397,898
- ---------------------------------------------------------------------------------
Pantry, Inc. (The) 1                                       4,900         147,441
- ---------------------------------------------------------------------------------
Party City Corp. 1                                           600           7,758
- ---------------------------------------------------------------------------------
Payless ShoeSource, Inc. 1                                15,700         193,110
- ---------------------------------------------------------------------------------
Petco Animal Supplies, Inc. 1                              2,700         106,596
- ---------------------------------------------------------------------------------
PETsMART, Inc.                                             2,400          85,272
- ---------------------------------------------------------------------------------
Pier 1 Imports, Inc.                                       4,800          94,560
- ---------------------------------------------------------------------------------
Regis Corp.                                                2,700         124,605
- ---------------------------------------------------------------------------------
Rent-A-Center, Inc. 1                                      2,400          63,600
- ---------------------------------------------------------------------------------
Rent-Way, Inc. 1                                           1,200           9,612
- ---------------------------------------------------------------------------------
Restoration Hardware, Inc. 1                              17,000          97,580
- ---------------------------------------------------------------------------------
Sonic Automotive, Inc.                                     2,000          49,600
- ---------------------------------------------------------------------------------
Steiner Leisure Ltd. 1                                     2,800          83,664
- ---------------------------------------------------------------------------------
Syms Corp. 1                                                 600           7,290
- ---------------------------------------------------------------------------------
Talbots, Inc. (The)                                        4,200         114,366
- ---------------------------------------------------------------------------------
Too, Inc. 1                                               10,000         244,600
- ---------------------------------------------------------------------------------
Toys R Us, Inc. 1                                          9,600         196,512
- ---------------------------------------------------------------------------------
Trans World Entertainment Corp. 1                         14,200         177,074
- ---------------------------------------------------------------------------------
Tuesday Morning Corp. 1                                    1,700          52,071
- ---------------------------------------------------------------------------------
Tweeter Home Entertainment Group, Inc. 1                   3,100          21,235
- ---------------------------------------------------------------------------------
United Auto Group, Inc.                                    4,100         121,319
- ---------------------------------------------------------------------------------
Zale Corp. 1                                              19,100         570,517
                                                                   --------------
                                                                      10,689,137

- ---------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--1.1%
Brown Shoe Co., Inc.                                         200           5,966
- ---------------------------------------------------------------------------------
Cherokee, Inc.                                               900          31,752
- ---------------------------------------------------------------------------------
Deckers Outdoor Corp. 1                                    2,800         131,572
- ---------------------------------------------------------------------------------
Hartmarx Corp. 1                                          15,000         116,550



                  9 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

TEXTILES, APPAREL & LUXURY GOODS Continued
Jones Apparel Group, Inc.                                  3,700   $     135,309
- ---------------------------------------------------------------------------------
K-Swiss, Inc., Cl. A                                      10,700         311,584
- ---------------------------------------------------------------------------------
Kellwood Co.                                               5,900         203,550
- ---------------------------------------------------------------------------------
Kenneth Cole Productions, Inc., Cl. A                      1,000          30,860
- ---------------------------------------------------------------------------------
Phillips/Van Heusen Corp.                                  5,100         137,700
- ---------------------------------------------------------------------------------
Russell Corp.                                              1,900          37,012
- ---------------------------------------------------------------------------------
Skechers U.S.A., Inc., Cl. A 1                            13,900         180,144
- ---------------------------------------------------------------------------------
Timberland Co., Cl. A 1                                    4,400         275,748
- ---------------------------------------------------------------------------------
Tommy Hilfiger Corp. 1                                     7,500          84,600
- ---------------------------------------------------------------------------------
Warnaco Group, Inc. (The) 1                                3,900          84,240
- ---------------------------------------------------------------------------------
Wolverine World Wide, Inc.                                16,700         524,714
                                                                   --------------
                                                                       2,291,301

- ---------------------------------------------------------------------------------
CONSUMER STAPLES--3.5%
- ---------------------------------------------------------------------------------
BEVERAGES--0.2%
Adolph Coors Co., Cl. B                                      100           7,567
- ---------------------------------------------------------------------------------
Boston Beer Co., Inc., Cl. A 1                             5,200         110,604
- ---------------------------------------------------------------------------------
Hansen Natural Corp. 1                                     3,700         134,717
- ---------------------------------------------------------------------------------
National Beverage Corp.                                    1,400          11,648
- ---------------------------------------------------------------------------------
PepsiAmericas, Inc.                                        5,800         123,192
                                                                   --------------
                                                                         387,728

- ---------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--1.1%
7-Eleven, Inc. 1                                          12,900         308,955
- ---------------------------------------------------------------------------------
Arden Group, Inc., Cl. A                                     800          80,380
- ---------------------------------------------------------------------------------
BJ's Wholesale Club, Inc. 1                               11,300         329,169
- ---------------------------------------------------------------------------------
Casey's General Stores, Inc.                               3,500          63,525
- ---------------------------------------------------------------------------------
Great Atlantic & Pacific Tea Co., Inc. (The) 1             6,200          63,550
- ---------------------------------------------------------------------------------
Ingles Markets, Inc., Cl. A                                  700           8,673
- ---------------------------------------------------------------------------------
Longs Drug Stores, Inc.                                   11,600         319,812
- ---------------------------------------------------------------------------------
Nash Finch Co.                                             7,500         283,200
- ---------------------------------------------------------------------------------
Rite Aid Corp. 1                                          43,400         158,844
- ---------------------------------------------------------------------------------
Ruddick Corp.                                             12,700         275,463
- ---------------------------------------------------------------------------------
Smart & Final, Inc. 1                                      3,900          56,121
- ---------------------------------------------------------------------------------
SUPERVALU, Inc.                                            4,800         165,696
- ---------------------------------------------------------------------------------
Weis Markets, Inc.                                         2,900         111,853
- ---------------------------------------------------------------------------------
Winn-Dixie Stores, Inc.                                   37,700         171,535
                                                                   --------------
                                                                       2,396,776

- ---------------------------------------------------------------------------------
FOOD PRODUCTS--1.1%
Alico, Inc. 1                                                100           5,852
- ---------------------------------------------------------------------------------
Cal-Maine Foods, Inc.                                     13,000         157,170
- ---------------------------------------------------------------------------------
Chiquita Brands International, Inc. 1                      7,300         161,038
- ---------------------------------------------------------------------------------
Corn Products International, Inc.                          9,500         508,820
- ---------------------------------------------------------------------------------
Darling International, Inc. 1                             38,200         166,552
- ---------------------------------------------------------------------------------
Del Monte Foods Co. 1                                      7,100          78,242


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

FOOD PRODUCTS Continued
Farmer Brothers Co.                                          100   $       2,424
- ---------------------------------------------------------------------------------
Flowers Foods, Inc.                                        8,000         252,640
- ---------------------------------------------------------------------------------
J&J Snack Foods Corp. 1                                    2,100         102,963
- ---------------------------------------------------------------------------------
Lancaster Colony Corp.                                     4,000         171,480
- ---------------------------------------------------------------------------------
Lance, Inc.                                                8,600         163,658
- ---------------------------------------------------------------------------------
M&F Worldwide Corp. 1                                      2,300          31,326
- ---------------------------------------------------------------------------------
Omega Protein Corp. 1                                      4,800          41,280
- ---------------------------------------------------------------------------------
Pilgrim's Pride Corp., Cl. B                               4,900         150,332
- ---------------------------------------------------------------------------------
Sanderson Farms, Inc.                                      6,350         274,828
- ---------------------------------------------------------------------------------
Smithfield Foods, Inc. 1                                   1,300          38,467
                                                                   --------------
                                                                       2,307,072

- ---------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--0.6%
Chattem, Inc. 1                                            4,900         162,190
- ---------------------------------------------------------------------------------
Energizer Holdings, Inc. 1                                 3,500         173,915
- ---------------------------------------------------------------------------------
Nu Skin Asia Pacific, Inc., Cl. A                         16,400         416,232
- ---------------------------------------------------------------------------------
Rayovac Corp. 1                                           15,500         473,680
                                                                   --------------
                                                                       1,226,017

- ---------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.4%
Del Laboratories, Inc. 1                                   2,538          88,196
- ---------------------------------------------------------------------------------
Elizabeth Arden, Inc. 1                                    9,800         232,652
- ---------------------------------------------------------------------------------
Inter Parfums, Inc.                                        1,200          19,080
- ---------------------------------------------------------------------------------
Mannatech, Inc.                                           15,200         289,408
- ---------------------------------------------------------------------------------
Nature's Sunshine Products, Inc.                           7,900         160,844
- ---------------------------------------------------------------------------------
NBTY, Inc. 1                                               6,500         156,065
                                                                   --------------
                                                                         946,245

- ---------------------------------------------------------------------------------
TOBACCO--0.1%
Star Scientific, Inc. 1                                   20,100         102,209
- ---------------------------------------------------------------------------------
Vector Group Ltd.                                          2,200          36,586
                                                                   --------------
                                                                         138,795

- ---------------------------------------------------------------------------------
ENERGY--7.2%
- ---------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--2.1%
Atwood Oceanics, Inc. 1                                    5,700         296,970
- ---------------------------------------------------------------------------------
Cal Dive International, Inc. 1                            14,700         599,025
- ---------------------------------------------------------------------------------
Carbo Ceramics, Inc.                                       2,300         158,700
- ---------------------------------------------------------------------------------
CHC Helicopter Corp., Cl. A                                  700          29,819
- ---------------------------------------------------------------------------------
Diamond Offshore Drilling, Inc.                            6,500         260,325
- ---------------------------------------------------------------------------------
Dril-Quip, Inc. 1                                            800          19,408
- ---------------------------------------------------------------------------------
Ensign Resource Service Group, Inc.                       14,000         293,169
- ---------------------------------------------------------------------------------
Grant Prideco, Inc. 1                                     10,900         218,545
- ---------------------------------------------------------------------------------
Gulf Island Fabrication, Inc.                              5,800         126,614
- ---------------------------------------------------------------------------------
Hydril Co. 1                                               4,100         186,591
- ---------------------------------------------------------------------------------
Key Energy Services, Inc. 1                                4,700          55,460
- ---------------------------------------------------------------------------------
Lone Star Technologies, Inc. 1                             6,300         210,798



                 10 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

ENERGY EQUIPMENT & SERVICES Continued
Maverick Tube Corp. 1                                      9,300   $     281,790
- ---------------------------------------------------------------------------------
NS Group, Inc. 1                                          11,100         308,580
- ---------------------------------------------------------------------------------
Oceaneering International, Inc. 1                          1,500          55,980
- ---------------------------------------------------------------------------------
Offshore Logistics, Inc. 1                                 3,700         120,139
- ---------------------------------------------------------------------------------
Oil States International, Inc. 1                          14,200         273,918
- ---------------------------------------------------------------------------------
Pioneer Drilling Co. 1                                     5,800          58,522
- ---------------------------------------------------------------------------------
Precision Drilling Corp. 1                                 1,500          94,546
- ---------------------------------------------------------------------------------
Pride International, Inc. 1                                5,100         104,754
- ---------------------------------------------------------------------------------
RPC, Inc.                                                  2,800          70,336
- ---------------------------------------------------------------------------------
Superior Energy Services, Inc. 1                             100           1,541
- ---------------------------------------------------------------------------------
Technicoil Corp. 1                                         7,100          15,505
- ---------------------------------------------------------------------------------
Tetra Technologies, Inc. 1                                 1,000          28,300
- ---------------------------------------------------------------------------------
Todco, Cl. A 1                                             2,500          46,050
- ---------------------------------------------------------------------------------
Total Energy Services Ltd. 1                              16,300          92,917
- ---------------------------------------------------------------------------------
Trican Well Service Ltd. 1                                 4,100         227,559
- ---------------------------------------------------------------------------------
Universal Compression Holdings, Inc. 1                     7,100         247,861
- ---------------------------------------------------------------------------------
Veritas DGC, Inc. 1                                        3,300          73,953
                                                                   --------------
                                                                       4,557,675

- ---------------------------------------------------------------------------------
OIL & GAS--5.1%
Ashland, Inc.                                              1,900         110,922
- ---------------------------------------------------------------------------------
Atlas Energy Ltd. 1                                       37,300         105,847
- ---------------------------------------------------------------------------------
ATP Oil & Gas Corp. 1                                      1,200          22,296
- ---------------------------------------------------------------------------------
Berry Petroleum Co., Cl. A                                 3,200         152,640
- ---------------------------------------------------------------------------------
Bill Barrett Corp. 1                                       7,000         223,930
- ---------------------------------------------------------------------------------
Blizzard Energy, Inc. 1                                   86,400         187,489
- ---------------------------------------------------------------------------------
Cabot Oil & Gas Corp., Cl. A                               5,800         256,650
- ---------------------------------------------------------------------------------
Callon Petroleum Co. 1                                     8,200         118,572
- ---------------------------------------------------------------------------------
Canadian Superior Energy, Inc. 1                          21,700          34,593
- ---------------------------------------------------------------------------------
Cimarex Energy Co. 1                                      14,290         541,591
- ---------------------------------------------------------------------------------
Clear Energy, Inc. 1                                       9,133          41,162
- ---------------------------------------------------------------------------------
Comstock Resources, Inc. 1                                 8,600         189,630
- ---------------------------------------------------------------------------------
Crew Energy, Inc. 1                                        5,666          39,487
- ---------------------------------------------------------------------------------
Cyries Energy, Inc. 1                                      1,940          12,613
- ---------------------------------------------------------------------------------
Daylight Energy Trust 1                                   32,900         263,606
- ---------------------------------------------------------------------------------
Denbury Resources, Inc. 1                                 11,500         315,675
- ---------------------------------------------------------------------------------
Duvernay Oil Corp. 1                                       4,500          73,163
- ---------------------------------------------------------------------------------
Edge Petroleum Corp. 1                                     1,100          16,038
- ---------------------------------------------------------------------------------
Encore Acquisition Co. 1                                   1,200          41,892
- ---------------------------------------------------------------------------------
Energy Partners Ltd. 1                                    19,000         385,130
- ---------------------------------------------------------------------------------
Esprit Energy Trust, Cl. A                                   950           9,753
- ---------------------------------------------------------------------------------
Fairborne Energy Ltd. 1,2                                  5,500          55,314
- ---------------------------------------------------------------------------------
Find Energy Ltd. 1                                         7,400          25,261
- ---------------------------------------------------------------------------------
Find Energy Ltd. 1                                        28,100          95,922
- ---------------------------------------------------------------------------------
Forest Oil Corp. 1                                         5,900         187,148
- ---------------------------------------------------------------------------------
Frontier Oil Corp.                                        16,700         445,222


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

OIL & GAS Continued
General Maritime Corp. 1                                   3,300   $     131,835
- ---------------------------------------------------------------------------------
Giant Industries, Inc. 1                                   3,200          84,832
- ---------------------------------------------------------------------------------
Harvest Natural Resources, Inc. 1                         14,600         252,142
- ---------------------------------------------------------------------------------
Holly Corp.                                                3,900         108,693
- ---------------------------------------------------------------------------------
Houston Exploration Co. 1                                  4,000         225,240
- ---------------------------------------------------------------------------------
KCS Energy, Inc. 1                                         9,000         133,020
- ---------------------------------------------------------------------------------
Ketch Resources Ltd. 1                                     4,900          69,115
- ---------------------------------------------------------------------------------
Lightning Energy Ltd. 1                                    1,100           3,975
- ---------------------------------------------------------------------------------
Lightning Energy Ltd. 1,3                                 14,400          49,293
- ---------------------------------------------------------------------------------
Magnum Hunter Resources, Inc. 1                           33,500         432,150
- ---------------------------------------------------------------------------------
Maritrans, Inc.                                            3,400          61,778
- ---------------------------------------------------------------------------------
Meridian Resource Corp. (The) 1                           13,200          79,860
- ---------------------------------------------------------------------------------
Midnight Oil Exploration Ltd. 1                           16,450          46,680
- ---------------------------------------------------------------------------------
Mission Resources Corp. 1                                  6,400          37,376
- ---------------------------------------------------------------------------------
Noble Energy, Inc.                                         1,700         104,822
- ---------------------------------------------------------------------------------
OMI Corp.                                                  8,600         144,910
- ---------------------------------------------------------------------------------
OPTI Canada, Inc. 1                                        3,500          56,758
- ---------------------------------------------------------------------------------
Overseas Shipholding Group, Inc.                           1,200          66,240
- ---------------------------------------------------------------------------------
Paramount Resources Ltd. 1                                18,800         422,084
- ---------------------------------------------------------------------------------
Patina Oil & Gas Corp.                                     4,700         176,250
- ---------------------------------------------------------------------------------
Penn Virginia Corp.                                        6,400         259,648
- ---------------------------------------------------------------------------------
Petroleum Development Corp. 1                              6,300         242,991
- ---------------------------------------------------------------------------------
Plains Exploration & Production Co. 1                     10,942         284,492
- ---------------------------------------------------------------------------------
ProEx Energy Ltd. 1                                        1,940          13,763
- ---------------------------------------------------------------------------------
ProspEx Resources Ltd. 1                                   2,120           5,839
- ---------------------------------------------------------------------------------
ProspEx Resources Ltd. 1,3                                 3,800           9,605
- ---------------------------------------------------------------------------------
Range Resources Corp.                                      6,200         126,852
- ---------------------------------------------------------------------------------
Real Resources, Inc. 1                                    11,900         117,595
- ---------------------------------------------------------------------------------
Remington Oil & Gas Corp. 1                                9,300         253,425
- ---------------------------------------------------------------------------------
Resource America, Inc., Cl. A                              2,900          94,250
- ---------------------------------------------------------------------------------
Southwestern Energy Co. 1                                  1,100          55,759
- ---------------------------------------------------------------------------------
St. Mary Land & Exploration Co.                            6,600         275,484
- ---------------------------------------------------------------------------------
StarPoint Energy Ltd. 1                                   49,800         220,290
- ---------------------------------------------------------------------------------
Stelmar Shipping Ltd.                                      3,600         171,756
- ---------------------------------------------------------------------------------
Stone Energy Corp. 1                                       1,100          49,599
- ---------------------------------------------------------------------------------
Sunoco, Inc.                                               2,800         228,788
- ---------------------------------------------------------------------------------
Swift Energy Co. 1                                         7,900         228,626
- ---------------------------------------------------------------------------------
Tesoro Corp. 1                                            12,700         404,622
- ---------------------------------------------------------------------------------
Thunder Energy, Inc. 1                                    18,666         116,843
- ---------------------------------------------------------------------------------
TKE Energy Trust 1                                        14,000         111,706
- ---------------------------------------------------------------------------------
Tusk Energy Corp. 1                                       20,700          50,966
- ---------------------------------------------------------------------------------
Tusk Energy Corp. 1,3                                     21,300          49,671
- ---------------------------------------------------------------------------------
VAALCO Energy, Inc. 1                                      5,000          19,400
- ---------------------------------------------------------------------------------
Vintage Petroleum, Inc.                                   19,000         431,110
- ---------------------------------------------------------------------------------
Whiting Petroleum Corp. 1                                  4,900         148,225



                 11 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

OIL & GAS Continued
World Fuel Services Corp.                                  3,000   $     149,400
                                                                   --------------
                                                                      10,759,304

- ---------------------------------------------------------------------------------
FINANCIALS--12.1%
- ---------------------------------------------------------------------------------
CAPITAL MARKETS--0.3%
Harris & Harris Group, Inc. 1                              3,800          62,244
- ---------------------------------------------------------------------------------
National Financial Partners Corp.                         10,700         415,160
- ---------------------------------------------------------------------------------
SWS Group, Inc.                                            8,900         195,088
                                                                   --------------
                                                                         672,492

- ---------------------------------------------------------------------------------
COMMERCIAL BANKS--4.4%
Alliance Financial Corp.                                     600          18,300
- ---------------------------------------------------------------------------------
AmericanWest Bancorporation                                2,910          58,928
- ---------------------------------------------------------------------------------
Anchor BanCorp Wisconsin, Inc.                             3,900         113,685
- ---------------------------------------------------------------------------------
Arrow Financial Corp.                                         62           1,922
- ---------------------------------------------------------------------------------
Associated Banc-Corp                                       4,113         136,593
- ---------------------------------------------------------------------------------
Astoria Financial Corp.                                    1,700          67,949
- ---------------------------------------------------------------------------------
BancorpSouth, Inc.                                         1,000          24,370
- ---------------------------------------------------------------------------------
Bank of Hawaii Corp.                                       1,900          96,406
- ---------------------------------------------------------------------------------
Bank of the Ozarks, Inc.                                     700          23,821
- ---------------------------------------------------------------------------------
BankAtlantic Bancorp, Inc.                                 5,500         109,450
- ---------------------------------------------------------------------------------
Banner Corp.                                                 800          24,952
- ---------------------------------------------------------------------------------
Berkshire Hills Bancorp, Inc.                              1,700          63,155
- ---------------------------------------------------------------------------------
Camco Financial Corp.                                        500           7,700
- ---------------------------------------------------------------------------------
Camden National Corp.                                        300          11,823
- ---------------------------------------------------------------------------------
Capital City Bank Group, Inc.                                425          17,765
- ---------------------------------------------------------------------------------
Capital Corp. of the West                                    400          18,800
- ---------------------------------------------------------------------------------
Capitol Bancorp Ltd.                                         600          21,132
- ---------------------------------------------------------------------------------
Center Financial Corp.                                     1,700          34,034
- ---------------------------------------------------------------------------------
CFS Bancorp, Inc.                                            200           2,854
- ---------------------------------------------------------------------------------
Chemical Financial Corp.                                   1,705          73,179
- ---------------------------------------------------------------------------------
Citizens First Bancorp, Inc.                               2,900          70,122
- ---------------------------------------------------------------------------------
City Holding Co.                                           7,400         268,176
- ---------------------------------------------------------------------------------
Colonial BancGroup, Inc. (The)                             8,400         178,332
- ---------------------------------------------------------------------------------
Columbia Banking System, Inc.                              5,590         139,694
- ---------------------------------------------------------------------------------
Commercial Federal Corp.                                   1,700          50,507
- ---------------------------------------------------------------------------------
Community Bancorp, Inc. 1                                    600          18,360
- ---------------------------------------------------------------------------------
Community Bank System, Inc.                               12,300         347,475
- ---------------------------------------------------------------------------------
Community Trust Bancorp, Inc.                                715          23,137
- ---------------------------------------------------------------------------------
Corus Bankshares, Inc.                                       900          43,209
- ---------------------------------------------------------------------------------
CVB Financial Corp.                                          510          13,546
- ---------------------------------------------------------------------------------
Dime Community Bancshares, Inc.                            3,612          64,691
- ---------------------------------------------------------------------------------
Downey Financial Corp.                                     2,300         131,100
- ---------------------------------------------------------------------------------
East West Bancorp, Inc.                                    2,200          92,312
- ---------------------------------------------------------------------------------
Fidelity Bankshares, Inc.                                  3,316         141,792
- ---------------------------------------------------------------------------------
First BanCorp                                                750          47,633


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMERCIAL BANKS Continued
First Citizens BancShares, Inc., Cl. A                       800   $     118,600
- ---------------------------------------------------------------------------------
First Commonwealth Financial Corp.                        12,600         193,914
- ---------------------------------------------------------------------------------
First Defiance Financial Corp.                             1,200          34,164
- ---------------------------------------------------------------------------------
First Financial Corp.                                        600          21,018
- ---------------------------------------------------------------------------------
First Financial Holdings, Inc.                             3,100         101,494
- ---------------------------------------------------------------------------------
First Merchants Corp.                                        615          17,405
- ---------------------------------------------------------------------------------
First Midwest Bancorp, Inc.                                  900          32,661
- ---------------------------------------------------------------------------------
First National Bankshares of Florida, Inc.                 1,957          46,772
- ---------------------------------------------------------------------------------
First Place Financial Corp.                                5,400         120,906
- ---------------------------------------------------------------------------------
First Republic Bank                                        4,100         217,300
- ---------------------------------------------------------------------------------
FirstFed Financial Corp. 1                                 2,400         124,488
- ---------------------------------------------------------------------------------
Flagstar Bancorp, Inc.                                     3,100          70,060
- ---------------------------------------------------------------------------------
Flushing Financial Corp.                                   1,775          35,607
- ---------------------------------------------------------------------------------
Foothill Independent Bancorp                                 118           2,771
- ---------------------------------------------------------------------------------
Frontier Financial Corp.                                     200           7,722
- ---------------------------------------------------------------------------------
GB&T Bancshares, Inc.                                      1,800          43,416
- ---------------------------------------------------------------------------------
Glacier Bancorp, Inc.                                      3,375         114,885
- ---------------------------------------------------------------------------------
Greater Bay Bancorp                                        9,300         259,284
- ---------------------------------------------------------------------------------
Hancock Holding Co.                                          700          23,422
- ---------------------------------------------------------------------------------
Harbor Florida Bancshares, Inc.                            3,900         134,979
- ---------------------------------------------------------------------------------
Hibernia Corp., Cl. A                                      5,400         159,354
- ---------------------------------------------------------------------------------
Home Federal Bancorp                                       1,000          25,219
- ---------------------------------------------------------------------------------
Horizon Financial Corp.                                      200           4,116
- ---------------------------------------------------------------------------------
Hudson River Bancorp, Inc.                                 2,400          47,496
- ---------------------------------------------------------------------------------
Hudson United Bancorp                                      1,300          51,194
- ---------------------------------------------------------------------------------
Independence Community Bank Corp.                          1,600          68,128
- ---------------------------------------------------------------------------------
Independent Bank Corp., Michigan                           4,443         132,535
- ---------------------------------------------------------------------------------
Indymac Mortgage Holdings, Inc.                            4,100         141,245
- ---------------------------------------------------------------------------------
ITLA Capital Corp. 1                                         400          23,516
- ---------------------------------------------------------------------------------
Macatawa Bank Corp.                                          455          14,692
- ---------------------------------------------------------------------------------
MainSource Financial Group, Inc.                             383           9,146
- ---------------------------------------------------------------------------------
NASB Financial, Inc.                                       1,100          43,956
- ---------------------------------------------------------------------------------
National Bankshares, Inc.                                    600          32,112
- ---------------------------------------------------------------------------------
NBT Bancorp, Inc.                                          2,500          64,300
- ---------------------------------------------------------------------------------
Net.B@nk, Inc.                                             9,100          94,731
- ---------------------------------------------------------------------------------
Oak Hill Financial, Inc.                                     500          19,395
- ---------------------------------------------------------------------------------
Old Second Bancorp, Inc.                                     316          10,074
- ---------------------------------------------------------------------------------
Oriental Financial Group, Inc.                             2,090          59,168
- ---------------------------------------------------------------------------------
Pacific Capital Bancorp                                   18,910         642,751
- ---------------------------------------------------------------------------------
Parkvale Financial Corp.                                     400          11,516
- ---------------------------------------------------------------------------------
PennRock Financial Services Corp.                          1,220          47,470
- ---------------------------------------------------------------------------------
PFF Bancorp, Inc.                                          5,940         275,200
- ---------------------------------------------------------------------------------
Provident Bankshares Corp.                                 3,251         118,239
- ---------------------------------------------------------------------------------
Provident Financial Holdings, Inc.                           800          23,080
- ---------------------------------------------------------------------------------
R&G Financial Corp., Cl. B                                11,800         458,784



                 12 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMERCIAL BANKS Continued
Republic Bancorp, Inc.                                    10,557   $     161,311
- ---------------------------------------------------------------------------------
Republic Bancorp, Inc., Cl. A                              3,560          91,492
- ---------------------------------------------------------------------------------
S&T Bancorp, Inc.                                            500          18,845
- ---------------------------------------------------------------------------------
Santander BanCorp                                            620          18,699
- ---------------------------------------------------------------------------------
Seacoast Banking Corp. of Florida                          3,630          80,768
- ---------------------------------------------------------------------------------
Silicon Valley Bancshares 1                                9,500         425,790
- ---------------------------------------------------------------------------------
Sky Financial Group, Inc.                                    600          17,202
- ---------------------------------------------------------------------------------
Sound Federal Bancorp, Inc.                                  300           4,875
- ---------------------------------------------------------------------------------
Southside Bancshares, Inc.                                   315           7,198
- ---------------------------------------------------------------------------------
Southwest Bancorp, Inc.                                    3,400          83,232
- ---------------------------------------------------------------------------------
State Bancorp, Inc.                                        1,162          31,955
- ---------------------------------------------------------------------------------
State Financial Services Corp.                             6,400         192,640
- ---------------------------------------------------------------------------------
Sterling Bancorp                                           4,360         123,170
- ---------------------------------------------------------------------------------
Sterling Financial Corp. (Western US)                     11,717         460,009
- ---------------------------------------------------------------------------------
Sun Bancorp, Inc.                                          1,196          29,876
- ---------------------------------------------------------------------------------
TCF Financial Corp.                                        1,600          51,424
- ---------------------------------------------------------------------------------
Texas Capital Bancshares, Inc. 1                             800          17,296
- ---------------------------------------------------------------------------------
TierOne Corp.                                              3,800          94,430
- ---------------------------------------------------------------------------------
Union Bankshares Corp.                                       900          34,587
- ---------------------------------------------------------------------------------
United Bankshares, Inc.                                    1,800          68,670
- ---------------------------------------------------------------------------------
United Community Financial Corp.                           1,300          14,560
- ---------------------------------------------------------------------------------
Univest Corp. of Pennsylvania                                300          13,806
- ---------------------------------------------------------------------------------
Vineyard National Bancorp Co.                                500          16,430
- ---------------------------------------------------------------------------------
Waypoint Financial Corp.                                   2,210          62,654
- ---------------------------------------------------------------------------------
Webster Financial Corp.                                    2,334         118,194
- ---------------------------------------------------------------------------------
WesBanco, Inc.                                             1,300          41,561
- ---------------------------------------------------------------------------------
WSFS Financial Corp.                                       4,200         253,344
                                                                   --------------
                                                                       9,389,207

- ---------------------------------------------------------------------------------
CONSUMER FINANCE--0.3%
Advance America Cash Advance Centers, Inc. 1               8,700         199,230
- ---------------------------------------------------------------------------------
ASTA Funding, Inc.                                         5,400         144,936
- ---------------------------------------------------------------------------------
MoneyGram International, Inc.                             12,700         268,478
                                                                   --------------
                                                                         612,644

- ---------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--1.4%
Ace Cash Express, Inc. 1                                     600          17,796
- ---------------------------------------------------------------------------------
Advanta Corp., Cl. B                                       3,700          89,799
- ---------------------------------------------------------------------------------
Affiliated Managers Group, Inc. 1                          8,500         575,790
- ---------------------------------------------------------------------------------
American Capital Strategies Ltd.                           2,700          90,045
- ---------------------------------------------------------------------------------
AmeriCredit Corp. 1                                        1,900          46,455
- ---------------------------------------------------------------------------------
Archipelago Holdings, Inc. 1                               1,400          29,372
- ---------------------------------------------------------------------------------
Cash America International, Inc.                           5,700         169,461
- ---------------------------------------------------------------------------------
CompuCredit Corp. 1                                       10,600         289,804
- ---------------------------------------------------------------------------------
E*TRADE Financial Corp. 1                                 14,100         210,795
- ---------------------------------------------------------------------------------
First Albany Cos., Inc.                                    1,300          12,610


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

DIVERSIFIED FINANCIAL SERVICES Continued
First Cash Financial Services, Inc. 1                      4,000   $     106,840
- ---------------------------------------------------------------------------------
Gabelli Asset Management, Inc.                             4,500         218,340
- ---------------------------------------------------------------------------------
Investment Technology Group, Inc. 1                        4,400          88,000
- ---------------------------------------------------------------------------------
Knight Trading Group, Inc. 1                               1,400          15,330
- ---------------------------------------------------------------------------------
MarketAxess Holdings, Inc. 1                               1,200          20,412
- ---------------------------------------------------------------------------------
Medallion Financial Corp.                                  1,700          16,490
- ---------------------------------------------------------------------------------
Metris Cos., Inc. 1                                       11,400         145,350
- ---------------------------------------------------------------------------------
Piper Jaffray Cos., Inc.                                   3,600         172,620
- ---------------------------------------------------------------------------------
Providian Financial Corp. 1                                6,800         111,996
- ---------------------------------------------------------------------------------
Raymond James Financial, Inc.                              2,400          74,352
- ---------------------------------------------------------------------------------
Sanders Morris Harris Group, Inc.                          4,100          73,021
- ---------------------------------------------------------------------------------
SEI Investments Co.                                        3,600         150,948
- ---------------------------------------------------------------------------------
United PanAm Financial Corp. 1                               700          13,342
- ---------------------------------------------------------------------------------
WFS Financial, Inc.                                        3,300         167,574
- ---------------------------------------------------------------------------------
World Acceptance Corp. 1                                   3,400          93,534
                                                                   --------------
                                                                       3,000,076

- ---------------------------------------------------------------------------------
INSURANCE--3.6%
Affirmative Insurance Holdings, Inc.                       6,800         114,512
- ---------------------------------------------------------------------------------
Alfa Corp.                                                 4,400          66,814
- ---------------------------------------------------------------------------------
Allmerica Financial Corp. 1                                6,000         196,980
- ---------------------------------------------------------------------------------
American Financial Group, Inc.                             5,700         178,467
- ---------------------------------------------------------------------------------
American Physicians Capital, Inc. 1                        1,800          64,836
- ---------------------------------------------------------------------------------
AmerUs Group Co.                                          10,900         493,770
- ---------------------------------------------------------------------------------
Arch Capital Group Ltd. 1                                  2,900         112,230
- ---------------------------------------------------------------------------------
Argonaut Group, Inc. 1                                       900          19,017
- ---------------------------------------------------------------------------------
Aspen Insurance Holdings Ltd.                              2,600          63,752
- ---------------------------------------------------------------------------------
Baldwin & Lyons, Inc., Cl. B, Non-Vtg                        600          16,074
- ---------------------------------------------------------------------------------
Commerce Group, Inc. (The)                                 4,000         244,160
- ---------------------------------------------------------------------------------
Danielson Holding Corp. 1                                  6,000          50,700
- ---------------------------------------------------------------------------------
Delphi Financial Group, Inc., Cl. A                        7,900         364,585
- ---------------------------------------------------------------------------------
Direct General Corp.                                       2,200          70,620
- ---------------------------------------------------------------------------------
Donegal Group, Inc., Cl. A                                 3,900          89,427
- ---------------------------------------------------------------------------------
EMC Insurance Group, Inc.                                    300           6,492
- ---------------------------------------------------------------------------------
Fidelity National Financial, Inc.                             79           3,608
- ---------------------------------------------------------------------------------
First American Corp. (The)                                 3,800         133,532
- ---------------------------------------------------------------------------------
FPIC Insurance Group, Inc. 1                               5,000         176,900
- ---------------------------------------------------------------------------------
Great American Financial Resources, Inc.                   1,300          22,581
- ---------------------------------------------------------------------------------
HCC Insurance Holdings, Inc.                               2,100          69,552
- ---------------------------------------------------------------------------------
Horace Mann Educators Corp.                               11,200         213,696
- ---------------------------------------------------------------------------------
Independence Holding Co.                                     540           9,963
- ---------------------------------------------------------------------------------
Infinity Property & Casualty Corp.                         5,800         204,160
- ---------------------------------------------------------------------------------
IPC Holdings Ltd.                                          2,300         100,073
- ---------------------------------------------------------------------------------
LandAmerica Financial Group, Inc.                          8,500         458,405
- ---------------------------------------------------------------------------------
Markel Corp. 1                                               100          36,400



                 13 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

INSURANCE Continued
Meadowbrook Insurance Group, Inc. 1                        3,400   $      16,966
- ---------------------------------------------------------------------------------
Mercury General Corp.                                      1,300          77,896
- ---------------------------------------------------------------------------------
National Western Life Insurance Co., Cl. A 1                 400          66,644
- ---------------------------------------------------------------------------------
Odyssey Re Holdings Corp.                                  9,400         236,974
- ---------------------------------------------------------------------------------
Ohio Casualty Corp. 1                                     18,100         420,101
- ---------------------------------------------------------------------------------
Old Republic International Corp.                           5,700         144,210
- ---------------------------------------------------------------------------------
Penn-America Group, Inc.                                   2,200          33,220
- ---------------------------------------------------------------------------------
Philadelphia Consolidated Holding Co. 1                    4,000         264,560
- ---------------------------------------------------------------------------------
Phoenix Cos., Inc. (The)                                   5,300          66,250
- ---------------------------------------------------------------------------------
PMA Capital Corp., Cl. A 1                                 4,500          46,575
- ---------------------------------------------------------------------------------
ProCentury Corp.                                          11,600         143,840
- ---------------------------------------------------------------------------------
Protective Life Corp.                                      2,800         119,532
- ---------------------------------------------------------------------------------
Pxre Group Ltd.                                            1,200          30,252
- ---------------------------------------------------------------------------------
Reinsurance Group of America, Inc.                         1,500          72,675
- ---------------------------------------------------------------------------------
RLI Corp.                                                  2,200          91,454
- ---------------------------------------------------------------------------------
Safety Insurance Group, Inc.                               1,800          56,070
- ---------------------------------------------------------------------------------
Selective Insurance Group, Inc.                            8,000         353,920
- ---------------------------------------------------------------------------------
StanCorp Financial Group, Inc.                             4,600         379,500
- ---------------------------------------------------------------------------------
State Auto Financial Corp.                                 7,700         199,045
- ---------------------------------------------------------------------------------
Stewart Information Services Corp.                         3,500         145,775
- ---------------------------------------------------------------------------------
Triad Guaranty, Inc. 1                                       500          30,240
- ---------------------------------------------------------------------------------
UICI                                                       3,500         118,650
- ---------------------------------------------------------------------------------
United Fire & Casualty Co.                                 4,000         134,840
- ---------------------------------------------------------------------------------
Unitrin, Inc.                                                400          18,180
- ---------------------------------------------------------------------------------
Universal American Financial Corp. 1                      29,200         451,724
- ---------------------------------------------------------------------------------
UnumProvident Corp.                                        6,200         111,228
- ---------------------------------------------------------------------------------
Vesta Insurance Group, Inc.                               13,100          48,208
- ---------------------------------------------------------------------------------
Zenith National Insurance Corp.                            4,300         214,312
                                                                   --------------
                                                                       7,674,147

- ---------------------------------------------------------------------------------
REAL ESTATE--1.6%
Acadia Realty Trust                                        1,100          17,930
- ---------------------------------------------------------------------------------
Agree Realty Corp.                                         4,600         145,774
- ---------------------------------------------------------------------------------
Alexandria Real Estate Equities, Inc.                        500          37,210
- ---------------------------------------------------------------------------------
Arden Realty, Inc.                                         1,500          56,580
- ---------------------------------------------------------------------------------
Associated Estates Realty Corp.                            1,100          11,242
- ---------------------------------------------------------------------------------
Brandywine Realty Trust                                    2,300          67,597
- ---------------------------------------------------------------------------------
Camden Property Trust                                      1,700          86,700
- ---------------------------------------------------------------------------------
Capital Automotive REIT                                    1,500          53,288
- ---------------------------------------------------------------------------------
Capstead Mortgage Corp.                                    1,100          11,594
- ---------------------------------------------------------------------------------
CarrAmerica Realty Corp.                                   1,100          36,300
- ---------------------------------------------------------------------------------
CB Richard Ellis Group, Inc., Cl. A 1                      3,000         100,650
- ---------------------------------------------------------------------------------
CBL & Associates Properties, Inc.                            800          61,080
- ---------------------------------------------------------------------------------
Colonial Properties Trust                                    800          31,416


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

REAL ESTATE Continued
Consolidated-Tomoka Land Co.                                 500   $      21,500
- ---------------------------------------------------------------------------------
Cornerstone Realty Income Trust, Inc.                        600           5,988
- ---------------------------------------------------------------------------------
Corporate Office Properties Trust                          1,100          32,285
- ---------------------------------------------------------------------------------
Correctional Properties Trust                              1,700          49,096
- ---------------------------------------------------------------------------------
CRT Properties, Inc.                                       1,500          35,790
- ---------------------------------------------------------------------------------
Equity Inns, Inc.                                          9,200         108,008
- ---------------------------------------------------------------------------------
First Industrial Realty Trust, Inc.                        1,900          77,387
- ---------------------------------------------------------------------------------
Friedman, Billings, Ramsey Group, Inc., Cl. A              5,300         102,767
- ---------------------------------------------------------------------------------
Glenborough Realty Trust, Inc.                               800          17,024
- ---------------------------------------------------------------------------------
Health Care REIT, Inc.                                     3,000         114,450
- ---------------------------------------------------------------------------------
Healthcare Realty Trust, Inc.                              1,500          61,050
- ---------------------------------------------------------------------------------
Heritage Property Investment Trust                           500          16,045
- ---------------------------------------------------------------------------------
Highwoods Properties, Inc.                                 2,300          63,710
- ---------------------------------------------------------------------------------
Impac Mortgage Holdings, Inc.                              1,500          34,005
- ---------------------------------------------------------------------------------
Jones Lang LaSalle, Inc. 1                                 7,000         261,870
- ---------------------------------------------------------------------------------
Kilroy Realty Corp.                                        1,300          55,575
- ---------------------------------------------------------------------------------
Lexington Corporate Properties Trust                       2,700          60,966
- ---------------------------------------------------------------------------------
LTC Properties, Inc.                                       1,000          19,910
- ---------------------------------------------------------------------------------
Mack-Cali Realty Corp.                                     1,500          69,045
- ---------------------------------------------------------------------------------
Maguire Properties, Inc.                                   1,400          38,444
- ---------------------------------------------------------------------------------
Mid-America Apartment Communities, Inc.                    1,500          61,830
- ---------------------------------------------------------------------------------
Mills Corp.                                                1,900         121,144
- ---------------------------------------------------------------------------------
Nationwide Health Properties, Inc.                         3,800          90,250
- ---------------------------------------------------------------------------------
Novastar Financial, Inc.                                   1,500          74,250
- ---------------------------------------------------------------------------------
Omega Healthcare Investors, Inc.                           1,100          12,980
- ---------------------------------------------------------------------------------
Pan Pacific Retail Properties, Inc.                        1,300          81,510
- ---------------------------------------------------------------------------------
Pennsylvania Real Estate Investment Trust                  1,900          81,320
- ---------------------------------------------------------------------------------
Prentiss Properties Trust                                    600          22,920
- ---------------------------------------------------------------------------------
PS Business Parks, Inc.                                      500          22,550
- ---------------------------------------------------------------------------------
Ramco-Gershenson Properties Trust                          2,100          67,725
- ---------------------------------------------------------------------------------
Redwood Trust, Inc.                                          800          49,672
- ---------------------------------------------------------------------------------
Regency Centers Corp.                                        800          44,320
- ---------------------------------------------------------------------------------
Senior Housing Properties Trust                            3,200          60,608
- ---------------------------------------------------------------------------------
Simon Property Group, Inc.                                   158          10,218
- ---------------------------------------------------------------------------------
SL Green Realty Corp.                                      1,100          66,605
- ---------------------------------------------------------------------------------
Spirit Finance Corp. 1                                    12,400         156,860
- ---------------------------------------------------------------------------------
Stratus Properties, Inc. 1                                 1,500          23,625
- ---------------------------------------------------------------------------------
Tanger Factory Outlet Centers, Inc.                        4,800         127,008
- ---------------------------------------------------------------------------------
Town & Country Trust                                         900          24,867
- ---------------------------------------------------------------------------------
Trammell Crow Co. 1                                        3,300          59,763
- ---------------------------------------------------------------------------------
Trizec Properties, Inc.                                    2,300          43,516
- ---------------------------------------------------------------------------------
United Capital Corp. 1                                       400           9,060
- ---------------------------------------------------------------------------------
United Dominion Realty Trust, Inc.                         1,100          27,280



                 14 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

REAL ESTATE Continued
Ventas, Inc.                                               1,900   $      52,079
                                                                   --------------
                                                                       3,354,236

- ---------------------------------------------------------------------------------
THRIFTS & MORTGAGE FINANCE--0.5%
Accredited Home Lenders Holding Co. 1                      4,000         198,720
- ---------------------------------------------------------------------------------
Bank Mutual Corp.                                          8,636         105,100
- ---------------------------------------------------------------------------------
CharterMac                                                 1,800          43,992
- ---------------------------------------------------------------------------------
Clifton Savings Bancorp, Inc.                              2,200          26,730
- ---------------------------------------------------------------------------------
Commercial Capital Bancorp, Inc.                           4,400         101,992
- ---------------------------------------------------------------------------------
Fremont General Corp.                                      8,900         224,102
- ---------------------------------------------------------------------------------
KBNT Bancorp, Inc.                                         1,400          23,660
- ---------------------------------------------------------------------------------
NewAlliance Bancshares, Inc.                               5,900          90,270
- ---------------------------------------------------------------------------------
Radian Group, Inc.                                         3,900         207,636
                                                                   --------------
                                                                       1,022,202

- ---------------------------------------------------------------------------------
HEALTH CARE--11.2%
- ---------------------------------------------------------------------------------
BIOTECHNOLOGY--1.6%
Abgenix, Inc. 1                                           12,800         132,352
- ---------------------------------------------------------------------------------
Affymetrix, Inc. 1                                         3,000         109,650
- ---------------------------------------------------------------------------------
Alexion Pharmaceuticals, Inc. 1                              800          20,160
- ---------------------------------------------------------------------------------
Aphton Corp. 1                                             1,600           4,976
- ---------------------------------------------------------------------------------
Applera Corp./Applied Biosystems Group                     9,300         194,463
- ---------------------------------------------------------------------------------
Array BioPharma, Inc. 1                                   20,400         194,208
- ---------------------------------------------------------------------------------
Bioenvision, Inc. 1                                        9,500          85,120
- ---------------------------------------------------------------------------------
Bone Care International, Inc. 1                            7,700         214,445
- ---------------------------------------------------------------------------------
Caliper Life Sciences, Inc. 1                              2,900          21,837
- ---------------------------------------------------------------------------------
Celgene Corp. 1                                            4,100         108,773
- ---------------------------------------------------------------------------------
Charles River Laboratories International, Inc. 1           1,144          52,635
- ---------------------------------------------------------------------------------
Corgentech, Inc. 1                                         1,700          14,076
- ---------------------------------------------------------------------------------
deCODE genetics, Inc. 1                                    2,800          21,868
- ---------------------------------------------------------------------------------
Durect Corp. 1                                             4,100          13,448
- ---------------------------------------------------------------------------------
Dusa Pharmaceuticals, Inc. 1                                 900          12,870
- ---------------------------------------------------------------------------------
Enzo Biochem, Inc.                                         3,000          58,410
- ---------------------------------------------------------------------------------
Gen-Probe, Inc. 1                                          2,600         117,546
- ---------------------------------------------------------------------------------
ID Biomedical Corp. 1                                      6,100          90,829
- ---------------------------------------------------------------------------------
ImmunoGen, Inc. 1                                          2,800          24,752
- ---------------------------------------------------------------------------------
Incyte Corp. 1                                             4,900          48,951
- ---------------------------------------------------------------------------------
Medarex, Inc. 1                                           10,100         108,878
- ---------------------------------------------------------------------------------
Medicines Co. (The) 1                                      7,600         218,880
- ---------------------------------------------------------------------------------
Millennium Pharmaceuticals, Inc. 1                         4,700          56,964
- ---------------------------------------------------------------------------------
Myriad Genetics, Inc. 1                                    6,500         146,315
- ---------------------------------------------------------------------------------
NeoPharm, Inc. 1                                           1,500          18,765
- ---------------------------------------------------------------------------------
Northfield Laboratories, Inc. 1                            3,400          76,670
- ---------------------------------------------------------------------------------
Onyx Pharmaceuticals, Inc. 1                               4,500         145,755
- ---------------------------------------------------------------------------------
Orchid Biosciences, Inc. 1                                 3,600          41,400


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

BIOTECHNOLOGY Continued
OSI Pharmaceuticals, Inc. 1                                3,200   $     239,520
- ---------------------------------------------------------------------------------
Regeneron Pharmaceuticals, Inc. 1                          5,800          53,418
- ---------------------------------------------------------------------------------
Savient Pharmaceuticals, Inc. 1                            2,700           7,317
- ---------------------------------------------------------------------------------
Techne Corp. 1                                             1,500          58,350
- ---------------------------------------------------------------------------------
Telik, Inc. 1                                              2,500          47,850
- ---------------------------------------------------------------------------------
Third Wave Technologies, Inc. 1                           18,700         160,820
- ---------------------------------------------------------------------------------
Trimeris, Inc. 1                                           4,600          65,182
- ---------------------------------------------------------------------------------
United Therapeutics Corp. 1                                5,400         243,810
- ---------------------------------------------------------------------------------
Vertex Pharmaceuticals, Inc. 1                            14,500         153,265
                                                                   --------------
                                                                       3,384,528

- ---------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--4.0%
ABIOMED, Inc. 1                                            2,400          37,056
- ---------------------------------------------------------------------------------
Adeza Biomedical Corp. 1                                   2,400          42,120
- ---------------------------------------------------------------------------------
Align Technology, Inc. 1                                  10,700         115,025
- ---------------------------------------------------------------------------------
American Medical Systems Holdings, Inc. 1                  7,500         313,575
- ---------------------------------------------------------------------------------
Anika Therapeutics, Inc. 1                                 5,300          48,495
- ---------------------------------------------------------------------------------
Arrow International, Inc.                                  9,000         278,910
- ---------------------------------------------------------------------------------
ArthroCare Corp. 1                                         5,200         166,712
- ---------------------------------------------------------------------------------
Aspect Medical Systems, Inc. 1                             7,000         171,220
- ---------------------------------------------------------------------------------
Bausch & Lomb, Inc.                                        1,000          64,460
- ---------------------------------------------------------------------------------
Bioveris Corp. 1                                             400           2,924
- ---------------------------------------------------------------------------------
CNS, Inc.                                                  2,900          36,395
- ---------------------------------------------------------------------------------
Conceptus, Inc. 1                                          1,500          12,173
- ---------------------------------------------------------------------------------
ConMed Corp. 1                                             7,100         201,782
- ---------------------------------------------------------------------------------
Conor Medsystems, Inc. 1                                   4,800          66,480
- ---------------------------------------------------------------------------------
Cytyc Corp. 1                                              1,400          38,598
- ---------------------------------------------------------------------------------
Dade Behring Holdings, Inc. 1                              4,700         263,200
- ---------------------------------------------------------------------------------
Datascope Corp.                                              300          11,907
- ---------------------------------------------------------------------------------
Diagnostic Products Corp.                                    200          11,010
- ---------------------------------------------------------------------------------
DJ Orthopedics, Inc. 1                                       900          19,278
- ---------------------------------------------------------------------------------
Endologix, Inc. 1                                          2,400          16,392
- ---------------------------------------------------------------------------------
EPIX Pharmaceuticals, Inc. 1                              10,200         182,682
- ---------------------------------------------------------------------------------
Exactech, Inc. 1                                           1,300          23,777
- ---------------------------------------------------------------------------------
Foxhollow Technologies, Inc. 1                               700          17,213
- ---------------------------------------------------------------------------------
Haemonetics Corp. 1                                        9,000         325,890
- ---------------------------------------------------------------------------------
HealthTronics, Inc. 1                                      3,600          38,268
- ---------------------------------------------------------------------------------
Hologic, Inc. 1                                            8,900         244,483
- ---------------------------------------------------------------------------------
Hospira, Inc. 1                                            8,800         294,800
- ---------------------------------------------------------------------------------
Idexx Laboratories, Inc. 1                                 1,200          65,508
- ---------------------------------------------------------------------------------
Immucor, Inc. 1                                            3,075          72,293
- ---------------------------------------------------------------------------------
Inamed Corp. 1                                             2,450         154,963
- ---------------------------------------------------------------------------------
Kensey Nash Corp. 1                                        7,100         245,163
- ---------------------------------------------------------------------------------
Kyphon, Inc. 1                                             5,400         139,104
- ---------------------------------------------------------------------------------
Lifeline Systems, Inc. 1                                   2,500          64,400



                 15 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

HEALTH CARE EQUIPMENT & SUPPLIES Continued
Matthews International Corp., Cl. A                        8,600   $     316,480
- ---------------------------------------------------------------------------------
Medical Action Industries, Inc. 1                          2,100          41,370
- ---------------------------------------------------------------------------------
Meridian Bioscience, Inc.                                  5,600          97,384
- ---------------------------------------------------------------------------------
Millipore Corp. 1                                            300          14,943
- ---------------------------------------------------------------------------------
Mine Safety Applicances Co.                                4,200         212,940
- ---------------------------------------------------------------------------------
Molecular Devices Corp. 1                                  7,300         146,730
- ---------------------------------------------------------------------------------
Occulogix, Inc. 1                                            800           8,224
- ---------------------------------------------------------------------------------
Ocular Sciences, Inc. 1                                    8,000         392,080
- ---------------------------------------------------------------------------------
OrthoLogic Corp. 1                                         7,000          43,750
- ---------------------------------------------------------------------------------
Palomar Medical Technologies, Inc. 1                       6,700         174,669
- ---------------------------------------------------------------------------------
PerkinElmer, Inc.                                          9,300         209,157
- ---------------------------------------------------------------------------------
PolyMedica Corp.                                           8,600         320,694
- ---------------------------------------------------------------------------------
Possis Medical, Inc. 1                                     6,600          88,968
- ---------------------------------------------------------------------------------
Respironics, Inc. 1                                        1,600          86,976
- ---------------------------------------------------------------------------------
SonoSite, Inc. 1                                           3,900         132,405
- ---------------------------------------------------------------------------------
SurModics, Inc. 1                                          4,900         159,299
- ---------------------------------------------------------------------------------
Sybron Dental Specialties, Inc. 1                         11,300         399,794
- ---------------------------------------------------------------------------------
Symmetry Medical, Inc. 1                                   4,000          84,200
- ---------------------------------------------------------------------------------
Thermo Electron Corp. 1                                    6,700         202,273
- ---------------------------------------------------------------------------------
TriPath Imaging, Inc. 1                                    2,800          25,116
- ---------------------------------------------------------------------------------
Urologix, Inc. 1                                           3,500          22,645
- ---------------------------------------------------------------------------------
Varian Medical Systems, Inc. 1                             1,700          73,508
- ---------------------------------------------------------------------------------
Varian, Inc. 1                                             3,700         151,737
- ---------------------------------------------------------------------------------
Ventana Medical Systems, Inc. 1                            6,100         390,339
- ---------------------------------------------------------------------------------
Viasys Healthcare, Inc. 1                                  2,400          45,600
- ---------------------------------------------------------------------------------
VISX, Inc. 1                                              18,900         488,943
- ---------------------------------------------------------------------------------
West Pharmaceutical Services, Inc.                         4,000         100,120
- ---------------------------------------------------------------------------------
Wright Medical Group, Inc. 1                               6,200         176,700
- ---------------------------------------------------------------------------------
Young Innovations, Inc.                                      550          18,552
                                                                   --------------
                                                                       8,411,852

- ---------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--4.5%
Alderwoods Group, Inc. 1                                   2,800          31,864
- ---------------------------------------------------------------------------------
Allscripts Healthcare Solutions, Inc. 1                   15,400         164,318
- ---------------------------------------------------------------------------------
Amedisys, Inc. 1                                           6,500         210,535
- ---------------------------------------------------------------------------------
America Service Group, Inc. 1                              3,350          89,680
- ---------------------------------------------------------------------------------
American Healthways, Inc. 1                                  800          26,432
- ---------------------------------------------------------------------------------
AMERIGROUP Corp. 1                                         1,100          83,226
- ---------------------------------------------------------------------------------
AMN Healthcare Services, Inc. 1                              800          12,728
- ---------------------------------------------------------------------------------
AmSurg Corp. 1                                             1,600          47,264
- ---------------------------------------------------------------------------------
Andrx Corp. 1                                              2,700          58,941
- ---------------------------------------------------------------------------------
Beverly Enterprises, Inc. 1                               18,700         171,105
- ---------------------------------------------------------------------------------
Bio-Reference Laboratories, Inc. 1                         4,900          85,260
- ---------------------------------------------------------------------------------
Cantel Medical Corp. 1                                       700          26,194
- ---------------------------------------------------------------------------------
Centene Corp. 1                                              600          17,010
- ---------------------------------------------------------------------------------
Cerner Corp. 1                                             3,900         207,363


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

HEALTH CARE PROVIDERS & SERVICES Continued
Computer Programs & Systems, Inc.                            400   $       9,260
- ---------------------------------------------------------------------------------
CorVel Corp. 1                                             2,100          56,238
- ---------------------------------------------------------------------------------
Covance, Inc. 1                                            7,300         282,875
- ---------------------------------------------------------------------------------
Coventry Health Care, Inc. 1                               2,800         148,624
- ---------------------------------------------------------------------------------
Cross Country Healthcare, Inc. 1                          10,700         193,456
- ---------------------------------------------------------------------------------
DaVita, Inc. 1                                             2,800         110,684
- ---------------------------------------------------------------------------------
Dendrite International, Inc. 1                             4,800          93,120
- ---------------------------------------------------------------------------------
Eclipsys Corp. 1                                          10,800         220,644
- ---------------------------------------------------------------------------------
Express Scripts, Inc. 1                                      300          22,932
- ---------------------------------------------------------------------------------
Genesis HealthCare Corp. 1                                 9,900         346,797
- ---------------------------------------------------------------------------------
Gentiva Health Services, Inc. 1                           12,900         215,688
- ---------------------------------------------------------------------------------
HealthExtras, Inc. 1                                      12,300         200,490
- ---------------------------------------------------------------------------------
Humana, Inc. 1                                             5,400         160,326
- ---------------------------------------------------------------------------------
IDX Systems Corp. 1                                        4,800         165,408
- ---------------------------------------------------------------------------------
Kindred Healthcare, Inc. 1                                 5,100         152,745
- ---------------------------------------------------------------------------------
LCA-Vision, Inc.                                          12,100         283,019
- ---------------------------------------------------------------------------------
LifePoint Hospitals, Inc. 1                                1,600          55,712
- ---------------------------------------------------------------------------------
Magellan Health Services, Inc. 1                           5,600         191,296
- ---------------------------------------------------------------------------------
Matria Healthcare, Inc. 1                                  4,800         187,536
- ---------------------------------------------------------------------------------
MedCath Corp. 1                                            2,800          68,992
- ---------------------------------------------------------------------------------
Merge Technologies, Inc. 1                                 3,600          80,100
- ---------------------------------------------------------------------------------
National HealthCare Corp.                                  1,200          42,360
- ---------------------------------------------------------------------------------
National Medical Health Card Systems, Inc. 1               2,500          57,753
- ---------------------------------------------------------------------------------
Omnicell, Inc. 1                                           1,200          13,200
- ---------------------------------------------------------------------------------
Option Care, Inc.                                         14,200         244,098
- ---------------------------------------------------------------------------------
Owens & Minor, Inc.                                       16,900         476,073
- ---------------------------------------------------------------------------------
PacifiCare Health Systems, Inc. 1                          3,700         209,124
- ---------------------------------------------------------------------------------
Parexel International Corp. 1                              9,200         186,760
- ---------------------------------------------------------------------------------
PDI, Inc. 1                                                7,400         164,872
- ---------------------------------------------------------------------------------
Pediatrix Medical Group, Inc. 1                            4,600         294,630
- ---------------------------------------------------------------------------------
Per-Se Technologies, Inc. 1                                4,000          63,320
- ---------------------------------------------------------------------------------
Pharmaceutical Product Development, Inc. 1                 1,900          78,451
- ---------------------------------------------------------------------------------
PRA International 1                                        2,600          64,428
- ---------------------------------------------------------------------------------
Province Healthcare Co. 1                                  8,800         196,680
- ---------------------------------------------------------------------------------
PSS World Medical, Inc. 1                                  8,600         107,629
- ---------------------------------------------------------------------------------
Psychiatric Solutions, Inc. 1                              2,600          95,056
- ---------------------------------------------------------------------------------
RehabCare Group, Inc. 1                                    7,700         215,523
- ---------------------------------------------------------------------------------
Res-Care, Inc. 1                                           7,500         114,150
- ---------------------------------------------------------------------------------
Select Medical Corp.                                      14,500         255,200
- ---------------------------------------------------------------------------------
Service Corp. International 1                             29,500         219,775
- ---------------------------------------------------------------------------------
SFBC International, Inc. 1                                   900          35,550
- ---------------------------------------------------------------------------------
Sierra Health Services, Inc. 1                             9,400         518,034
- ---------------------------------------------------------------------------------
Stewart Enterprises, Inc. 1                               50,100         350,199
- ---------------------------------------------------------------------------------
Sunrise Senior Living, Inc. 1                              7,300         338,428



                 16 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

HEALTH CARE PROVIDERS & SERVICES Continued
United Surgical Partners International, Inc. 1             5,600   $     233,520
- ---------------------------------------------------------------------------------
VCA Antech, Inc. 1                                        16,700         327,320
- ---------------------------------------------------------------------------------
Ventiv Health, Inc. 1                                      6,700         136,144
- ---------------------------------------------------------------------------------
VistaCare, Inc., Cl. A 1                                   1,600          26,608
- ---------------------------------------------------------------------------------
WellChoice, Inc. 1                                         2,000         106,800
                                                                   --------------
                                                                       9,649,547

- ---------------------------------------------------------------------------------
PHARMACEUTICALS--1.1%
Able Laboratories, Inc. 1                                  5,800         131,950
- ---------------------------------------------------------------------------------
Alpharma, Inc., Cl. A                                      6,200         105,090
- ---------------------------------------------------------------------------------
AtheroGenics, Inc. 1                                       7,700         181,412
- ---------------------------------------------------------------------------------
Barr Pharmaceuticals, Inc. 1                               2,500         113,850
- ---------------------------------------------------------------------------------
Caraco Pharmaceutical Laboratories Ltd. 1                  3,700          35,335
- ---------------------------------------------------------------------------------
Connetics Corp. 1                                          3,000          72,870
- ---------------------------------------------------------------------------------
DOV Pharmaceutical, Inc. 1                                 8,000         144,400
- ---------------------------------------------------------------------------------
Encysive Pharmaceuticals, Inc. 1                           1,900          18,867
- ---------------------------------------------------------------------------------
Endo Pharmaceuticals Holdings, Inc. 1                      3,700          77,774
- ---------------------------------------------------------------------------------
First Horizon Pharmaceutical Corp. 1                      21,100         482,979
- ---------------------------------------------------------------------------------
Indevus Pharmaceuticals, Inc. 1                            5,900          35,164
- ---------------------------------------------------------------------------------
InKine Pharmaceutical Co., Inc. 1                          1,100           5,973
- ---------------------------------------------------------------------------------
Inspire Pharmaceuticals, Inc. 1                            4,100          68,757
- ---------------------------------------------------------------------------------
Nabi Biopharmaceuticals, Inc. 1                           15,500         227,075
- ---------------------------------------------------------------------------------
Noven Pharmaceuticals, Inc. 1                              1,200          20,472
- ---------------------------------------------------------------------------------
Par Pharmaceutical Cos., Inc. 1                            1,200          49,656
- ---------------------------------------------------------------------------------
Perrigo Co.                                               14,100         243,507
- ---------------------------------------------------------------------------------
Rigel Pharmaceuticals, Inc. 1                              4,500         109,890
- ---------------------------------------------------------------------------------
Salix Pharmaceuticals Ltd. 1                               8,200         144,238
- ---------------------------------------------------------------------------------
Seattle Genetics, Inc. 1                                   4,400          28,732
                                                                   --------------
                                                                       2,297,991

- ---------------------------------------------------------------------------------
INDUSTRIALS--17.4%
- ---------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.1%
AAR Corp. 1                                                1,200          16,344
- ---------------------------------------------------------------------------------
Applied Signal Technology, Inc.                            8,100         285,525
- ---------------------------------------------------------------------------------
Astronics Corp., Cl. B 1                                     650           3,088
- ---------------------------------------------------------------------------------
Aviall, Inc. 1                                             9,900         227,403
- ---------------------------------------------------------------------------------
BE Aerospace, Inc. 1                                      11,000         128,040
- ---------------------------------------------------------------------------------
EDO Corp.                                                  7,400         234,950
- ---------------------------------------------------------------------------------
Engineered Support Systems, Inc.                             550          32,571
- ---------------------------------------------------------------------------------
ESCO Technologies, Inc. 1                                  2,300         176,295
- ---------------------------------------------------------------------------------
Goodrich Corp.                                             2,100          68,544
- ---------------------------------------------------------------------------------
HEICO Corp., Cl. A                                            30             519
- ---------------------------------------------------------------------------------
Herley Industries, Inc. 1                                    600          12,204
- ---------------------------------------------------------------------------------
Innovative Solutions & Support, Inc. 1                     8,400         280,224
- ---------------------------------------------------------------------------------
Moog, Inc., Cl. A 1                                        2,500         113,375


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

AEROSPACE & DEFENSE Continued
Orbital Sciences Corp. 1                                  30,400   $     359,632
- ---------------------------------------------------------------------------------
SI International, Inc. 1                                   5,000         153,800
- ---------------------------------------------------------------------------------
Teledyne Technologies, Inc. 1                              1,700          50,031
- ---------------------------------------------------------------------------------
United Defense Industries, Inc. 1                          3,400         160,650
                                                                   --------------
                                                                       2,303,195

- ---------------------------------------------------------------------------------
AIR FREIGHT & LOGISTICS--0.7%
ABX Air, Inc. 1                                           27,800         247,142
- ---------------------------------------------------------------------------------
Dynamex, Inc. 1                                            5,200          96,356
- ---------------------------------------------------------------------------------
EGL, Inc. 1                                               12,800         382,592
- ---------------------------------------------------------------------------------
Forward Air Corp. 1                                       11,000         491,700
- ---------------------------------------------------------------------------------
Hub Group, Inc., Cl. A 1                                   4,000         208,880
- ---------------------------------------------------------------------------------
Park-Ohio Holdings Corp. 1                                   800          20,720
                                                                   --------------
                                                                       1,447,390

- ---------------------------------------------------------------------------------
AIRLINES--1.1%
Alaska Air Group, Inc. 1                                   9,700         324,853
- ---------------------------------------------------------------------------------
America West Holdings Corp., Cl. B 1                      23,400         153,972
- ---------------------------------------------------------------------------------
AMR Corp. 1                                               27,600         302,220
- ---------------------------------------------------------------------------------
Continental Airlines, Inc., Cl. B 1                       31,900         431,926
- ---------------------------------------------------------------------------------
Delta Air Lines, Inc. 1                                   28,500         213,180
- ---------------------------------------------------------------------------------
ExpressJet Holdings, Inc. 1                               21,700         279,496
- ---------------------------------------------------------------------------------
FLYi, Inc. 1                                              11,300          20,001
- ---------------------------------------------------------------------------------
Frontier Airlines, Inc. 1                                 13,700         156,317
- ---------------------------------------------------------------------------------
Hawaiian Holdings, Inc. 1                                  7,900          53,957
- ---------------------------------------------------------------------------------
Mesa Air Group, Inc. 1                                    12,800         101,632
- ---------------------------------------------------------------------------------
Northwest Airlines Corp., Cl. A 1                         16,000         174,880
- ---------------------------------------------------------------------------------
Pinnacle Airlines Corp. 1                                  3,900          54,366
- ---------------------------------------------------------------------------------
Republic Airways Holdings, Inc. 1                          1,500          19,905
- ---------------------------------------------------------------------------------
SkyWest, Inc.                                              6,500         130,390
                                                                   --------------
                                                                       2,417,095

- ---------------------------------------------------------------------------------
BUILDING PRODUCTS--0.9%
American Woodmark Corp.                                    1,100          48,048
- ---------------------------------------------------------------------------------
Apogee Enterprises, Inc.                                  11,500         154,215
- ---------------------------------------------------------------------------------
Beacon Roofing Supply, Inc. 1                              3,800          75,468
- ---------------------------------------------------------------------------------
Crane Co.                                                  5,800         167,272
- ---------------------------------------------------------------------------------
Jacuzzi Brands, Inc. 1                                     6,800          59,160
- ---------------------------------------------------------------------------------
Lennox International, Inc.                                 6,000         122,100
- ---------------------------------------------------------------------------------
NCI Building Systems, Inc. 1                               7,700         288,750
- ---------------------------------------------------------------------------------
Simpson Manufacturing Co., Inc.                            8,300         289,670
- ---------------------------------------------------------------------------------
Trex Co., Inc. 1                                           3,100         162,564
- ---------------------------------------------------------------------------------
Universal Forest Products, Inc.                            7,600         329,840
- ---------------------------------------------------------------------------------
USG Corp. 1                                                4,800         193,296
- ---------------------------------------------------------------------------------
Watsco, Inc.                                               3,300         116,226
                                                                   --------------
                                                                       2,006,609



                 17 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMERCIAL SERVICES & SUPPLIES--5.0%
ABM Industries, Inc.                                      12,700   $     250,444
- ---------------------------------------------------------------------------------
Adesa, Inc.                                                8,200         174,004
- ---------------------------------------------------------------------------------
Administaff, Inc. 1                                       16,900         213,109
- ---------------------------------------------------------------------------------
Angelica Corp.                                             1,800          48,690
- ---------------------------------------------------------------------------------
Banta Corp.                                                6,100         273,036
- ---------------------------------------------------------------------------------
Brady Corp., Cl. A                                         3,800         237,766
- ---------------------------------------------------------------------------------
Bright Horizons Family Solutions, Inc. 1                   4,500         291,420
- ---------------------------------------------------------------------------------
Brink's Co. (The)                                          9,500         375,440
- ---------------------------------------------------------------------------------
Central Parking Corp.                                      1,900          28,785
- ---------------------------------------------------------------------------------
Century Business Services, Inc. 1                          1,800           7,848
- ---------------------------------------------------------------------------------
Clean Harbors, Inc. 1                                      1,000          15,080
- ---------------------------------------------------------------------------------
Coinstar, Inc. 1                                           2,600          69,758
- ---------------------------------------------------------------------------------
CompX International, Inc.                                    500           8,265
- ---------------------------------------------------------------------------------
Consolidated Graphics, Inc. 1                              7,800         358,020
- ---------------------------------------------------------------------------------
Copart, Inc. 1                                             8,900         234,248
- ---------------------------------------------------------------------------------
Corporate Executive Board Co.                              1,300          87,022
- ---------------------------------------------------------------------------------
CoStar Group, Inc. 1                                       1,900          87,742
- ---------------------------------------------------------------------------------
CPI Corp.                                                  1,000          13,590
- ---------------------------------------------------------------------------------
DiamondCluster International, Inc. 1                      12,700         181,991
- ---------------------------------------------------------------------------------
Dun & Bradstreet Corp. 1                                   3,500         208,775
- ---------------------------------------------------------------------------------
Duratek, Inc. 1                                            5,000         124,550
- ---------------------------------------------------------------------------------
Electro Rent Corp.                                         1,000          14,230
- ---------------------------------------------------------------------------------
Ennis, Inc.                                                6,300         121,275
- ---------------------------------------------------------------------------------
Equifax, Inc.                                              4,500         126,450
- ---------------------------------------------------------------------------------
Exponent, Inc. 1                                           5,100         140,199
- ---------------------------------------------------------------------------------
G&K Services, Inc., Cl. A                                  5,200         225,784
- ---------------------------------------------------------------------------------
General Binding Corp. 1                                    1,500          19,710
- ---------------------------------------------------------------------------------
Geo Group, Inc. (The) 1                                    3,300          87,714
- ---------------------------------------------------------------------------------
Gevity HR, Inc.                                            5,200         106,912
- ---------------------------------------------------------------------------------
Harland (John H.) Co.                                      6,500         234,650
- ---------------------------------------------------------------------------------
Healthcare Services Group, Inc.                            8,850         184,434
- ---------------------------------------------------------------------------------
Heidrick & Struggles International, Inc. 1                14,100         483,207
- ---------------------------------------------------------------------------------
HNI Corp.                                                  3,800         163,590
- ---------------------------------------------------------------------------------
Hudson Highland Group, Inc. 1                              7,700         221,760
- ---------------------------------------------------------------------------------
Ikon Office Solutions, Inc.                               17,100         197,676
- ---------------------------------------------------------------------------------
Imagistics International, Inc. 1                           4,200         141,372
- ---------------------------------------------------------------------------------
Interpool, Inc.                                            1,400          33,600
- ---------------------------------------------------------------------------------
Intersections, Inc. 1                                      1,400          24,150
- ---------------------------------------------------------------------------------
ITT Educational Services, Inc. 1                           2,200         104,610
- ---------------------------------------------------------------------------------
Jackson Hewitt Tax Service, Inc.                           4,400         111,100
- ---------------------------------------------------------------------------------
Kelly Services, Inc., Cl. A                                  900          27,162
- ---------------------------------------------------------------------------------
Kforce, Inc. 1                                             4,500          49,950
- ---------------------------------------------------------------------------------
Knoll, Inc. 1                                             19,900         348,250
- ---------------------------------------------------------------------------------
Korn-Ferry International 1                                18,900         392,175
- ---------------------------------------------------------------------------------
Labor Ready, Inc. 1                                       26,500         448,380


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMERCIAL SERVICES & SUPPLIES Continued
Laureate Education, Inc. 1                                   300   $      13,227
- ---------------------------------------------------------------------------------
McGrath RentCorp                                           1,800          78,498
- ---------------------------------------------------------------------------------
Miller (Herman), Inc.                                      2,000          55,260
- ---------------------------------------------------------------------------------
Mobile Mini, Inc. 1                                          600          19,824
- ---------------------------------------------------------------------------------
NCO Group, Inc. 1                                            700          18,095
- ---------------------------------------------------------------------------------
Portfolio Recovery Associates, Inc. 1                      8,000         329,760
- ---------------------------------------------------------------------------------
Pre-Paid Legal Services, Inc. 1                            1,000          37,550
- ---------------------------------------------------------------------------------
PRG-Schultz International, Inc. 1                          3,800          19,114
- ---------------------------------------------------------------------------------
Resources Connection, Inc. 1                               2,400         130,344
- ---------------------------------------------------------------------------------
Robert Half International, Inc.                            3,900         114,777
- ---------------------------------------------------------------------------------
Rollins, Inc.                                              7,200         189,504
- ---------------------------------------------------------------------------------
Rush Enterprises, Inc., Cl. A 1                            3,600          58,428
- ---------------------------------------------------------------------------------
Schawk, Inc.                                               1,100          19,998
- ---------------------------------------------------------------------------------
School Specialty, Inc. 1                                   4,000         154,240
- ---------------------------------------------------------------------------------
SITEL Corp. 1                                             12,400          30,504
- ---------------------------------------------------------------------------------
Sotheby's Holdings, Inc., Cl. A 1                         15,200         276,032
- ---------------------------------------------------------------------------------
Spherion Corp. 1                                          11,700          98,280
- ---------------------------------------------------------------------------------
Standard Register Co. (The)                                1,200          16,944
- ---------------------------------------------------------------------------------
Steelcase, Inc., Cl. A                                     9,300         128,712
- ---------------------------------------------------------------------------------
TeleTech Holdings, Inc. 1                                 17,400         168,606
- ---------------------------------------------------------------------------------
United Stationers, Inc. 1                                  7,500         346,500
- ---------------------------------------------------------------------------------
Universal Technical Institute, Inc. 1                      1,900          72,428
- ---------------------------------------------------------------------------------
Viad Corp.                                                 6,300         179,487
- ---------------------------------------------------------------------------------
Volt Information Sciences, Inc. 1                          2,200          64,658
- ---------------------------------------------------------------------------------
Waste Connections, Inc. 1                                  7,700         263,725
- ---------------------------------------------------------------------------------
Waste Industries USA, Inc.                                   100           1,240
- ---------------------------------------------------------------------------------
Watson Wyatt & Co. Holdings                                8,500         229,075
- ---------------------------------------------------------------------------------
West Corp. 1                                               3,400         112,574
                                                                   --------------
                                                                      10,525,307

- ---------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--0.5%
Comfort Systems USA, Inc. 1                               12,800          98,304
- ---------------------------------------------------------------------------------
Dycom Industries, Inc. 1                                   4,700         143,444
- ---------------------------------------------------------------------------------
EMCOR Group, Inc. 1                                        1,100          49,698
- ---------------------------------------------------------------------------------
Granite Construction, Inc.                                 5,700         151,620
- ---------------------------------------------------------------------------------
Insituform Technologies, Inc., Cl. A 1                    11,800         267,506
- ---------------------------------------------------------------------------------
Integrated Electrical Services, Inc. 1                     5,900          28,556
- ---------------------------------------------------------------------------------
MasTec, Inc. 1                                             2,500          25,275
- ---------------------------------------------------------------------------------
McDermott International, Inc. 1                            4,500          82,620
- ---------------------------------------------------------------------------------
Perini Corp. 1                                             4,600          76,774
- ---------------------------------------------------------------------------------
Shaw Group, Inc. (The) 1                                   7,000         124,950
- ---------------------------------------------------------------------------------
URS Corp. 1                                                3,200         102,720
                                                                   --------------
                                                                       1,151,467



                 18 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

ELECTRICAL EQUIPMENT--1.2%
Active Power, Inc. 1                                       3,400   $      15,640
- ---------------------------------------------------------------------------------
Acuity Brands, Inc.                                        7,200         228,960
- ---------------------------------------------------------------------------------
American Power Conversion Corp.                            7,400         158,360
- ---------------------------------------------------------------------------------
AMETEK, Inc.                                                 600          21,402
- ---------------------------------------------------------------------------------
AMX Corp. 1                                                5,300          87,291
- ---------------------------------------------------------------------------------
Baldor Electric Co.                                        7,300         200,969
- ---------------------------------------------------------------------------------
Energy Conversion Devices, Inc. 1                         10,500         202,860
- ---------------------------------------------------------------------------------
Evergreen Solar, Inc. 1                                    5,600          24,472
- ---------------------------------------------------------------------------------
Franklin Electric Co., Inc.                                1,200          50,712
- ---------------------------------------------------------------------------------
Genlyte Group, Inc. (The) 1                                6,300         539,784
- ---------------------------------------------------------------------------------
Hubbell, Inc., Cl. B                                       3,500         183,050
- ---------------------------------------------------------------------------------
II-VI, Inc. 1                                              5,700         242,193
- ---------------------------------------------------------------------------------
LSI Industries, Inc.                                         500           5,725
- ---------------------------------------------------------------------------------
Plug Power, Inc. 1                                         2,500          15,275
- ---------------------------------------------------------------------------------
Preformed Line Products Co.                                  500          14,490
- ---------------------------------------------------------------------------------
Tecumseh Products Co., Cl. A                                 300          14,340
- ---------------------------------------------------------------------------------
Thomas & Betts Corp. 1                                     9,700         298,275
- ---------------------------------------------------------------------------------
Vicor Corp.                                                4,500          58,995
- ---------------------------------------------------------------------------------
Woodward Governor Co.                                      1,800         128,898
                                                                   --------------
                                                                       2,491,691

- ---------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.3%
Alleghany Corp.                                              500         142,625
- ---------------------------------------------------------------------------------
Carlisle Cos., Inc.                                        1,100          71,412
- ---------------------------------------------------------------------------------
Raven Industries, Inc.                                     5,900         125,729
- ---------------------------------------------------------------------------------
Standex International Corp.                                  100           2,849
- ---------------------------------------------------------------------------------
United Industrial Corp.                                    9,600         371,904
                                                                   --------------
                                                                         714,519

- ---------------------------------------------------------------------------------
MACHINERY--3.9%
A.S.V., Inc. 1                                             3,500         167,650
- ---------------------------------------------------------------------------------
Actuant Corp., Cl. A 1                                     1,100          57,365
- ---------------------------------------------------------------------------------
Alamo Group, Inc.                                            700          19,012
- ---------------------------------------------------------------------------------
Albany International Corp., Cl. A                          4,500         158,220
- ---------------------------------------------------------------------------------
Ampco-Pittsburgh Corp.                                     1,100          16,060
- ---------------------------------------------------------------------------------
Astec Industries, Inc. 1                                   6,900         118,749
- ---------------------------------------------------------------------------------
Bucyrus International, Inc., Cl. A                         5,900         239,776
- ---------------------------------------------------------------------------------
Cascade Corp.                                              4,100         163,795
- ---------------------------------------------------------------------------------
Clarcor, Inc.                                              2,900         158,833
- ---------------------------------------------------------------------------------
Cummins, Inc.                                              2,300         192,717
- ---------------------------------------------------------------------------------
EnPro Industries, Inc. 1                                   4,300         127,151
- ---------------------------------------------------------------------------------
Federal Signal Corp.                                       6,600         116,556
- ---------------------------------------------------------------------------------
Flanders Corp. 1                                           5,600          53,760
- ---------------------------------------------------------------------------------
Flowserve Corp. 1                                          6,900         190,026
- ---------------------------------------------------------------------------------
Gardner Denver, Inc. 1                                     2,300          83,467
- ---------------------------------------------------------------------------------
Graco, Inc.                                                2,550          95,243


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

MACHINERY Continued
Greenbrier Cos., Inc.                                      5,200   $     176,020
- ---------------------------------------------------------------------------------
Harsco Corp.                                               3,000         167,220
- ---------------------------------------------------------------------------------
Hexcel Corp. 1                                            25,300         366,850
- ---------------------------------------------------------------------------------
Idex Corp.                                                 1,600          64,800
- ---------------------------------------------------------------------------------
JLG Industries, Inc.                                      10,500         206,115
- ---------------------------------------------------------------------------------
Joy Global, Inc.                                           4,782         207,682
- ---------------------------------------------------------------------------------
Kadant, Inc. 1                                             3,100          63,550
- ---------------------------------------------------------------------------------
Kennametal, Inc.                                           8,000         398,160
- ---------------------------------------------------------------------------------
Lincoln Electric Holdings, Inc.                           13,400         462,836
- ---------------------------------------------------------------------------------
Manitowoc Co., Inc. (The)                                  6,500         244,725
- ---------------------------------------------------------------------------------
Middleby Corp. (The)                                       2,500         126,800
- ---------------------------------------------------------------------------------
Mueller Industries, Inc.                                  12,900         415,380
- ---------------------------------------------------------------------------------
NACCO Industries, Inc., Cl. A                              2,200         231,880
- ---------------------------------------------------------------------------------
Navistar International Corp. 1                             4,300         189,114
- ---------------------------------------------------------------------------------
Nordson Corp.                                              8,200         328,574
- ---------------------------------------------------------------------------------
Oshkosh Truck Corp.                                        1,900         129,922
- ---------------------------------------------------------------------------------
Pall Corp.                                                 4,100         118,695
- ---------------------------------------------------------------------------------
Penn Engineering & Manufacturing Corp.                     2,500          45,250
- ---------------------------------------------------------------------------------
Reliance Steel & Aluminum Co.                              9,600         374,016
- ---------------------------------------------------------------------------------
Robbins & Myers, Inc.                                      1,600          38,128
- ---------------------------------------------------------------------------------
SPX Corp.                                                  4,500         180,270
- ---------------------------------------------------------------------------------
Stewart & Stevenson Services, Inc.                         3,700          74,851
- ---------------------------------------------------------------------------------
Terex Corp. 1                                              5,700         271,605
- ---------------------------------------------------------------------------------
Thomas Industries, Inc.                                    1,500          59,880
- ---------------------------------------------------------------------------------
Timken Co.                                                 5,500         143,110
- ---------------------------------------------------------------------------------
Titan International, Inc.                                  5,100          77,010
- ---------------------------------------------------------------------------------
Toro Co. (The)                                             7,800         634,530
- ---------------------------------------------------------------------------------
Wabash National Corp. 1                                    8,700         234,291
- ---------------------------------------------------------------------------------
Wabtec Corp.                                               8,400         179,088
                                                                   --------------
                                                                       8,168,732

- ---------------------------------------------------------------------------------
MARINE--0.2%
Alexander & Baldwin, Inc.                                  4,300         182,406
- ---------------------------------------------------------------------------------
Kirby Corp. 1                                              3,900         173,082
                                                                   --------------
                                                                         355,488

- ---------------------------------------------------------------------------------
ROAD & RAIL--1.9%
Amerco, Inc. 1                                               300          13,794
- ---------------------------------------------------------------------------------
Arkansas Best Corp.                                       11,500         516,235
- ---------------------------------------------------------------------------------
CNF Transportation, Inc.                                   6,300         315,630
- ---------------------------------------------------------------------------------
Florida East Coast Industries, Inc., Cl. A                 2,500         112,750
- ---------------------------------------------------------------------------------
Genesee & Wyoming, Inc., Cl. A 1                          11,450         322,089
- ---------------------------------------------------------------------------------
Heartland Express, Inc.                                   13,700         307,839
- ---------------------------------------------------------------------------------
Hunt (J.B.) Transport Services, Inc.                       3,200         143,520
- ---------------------------------------------------------------------------------
Kansas City Southern 1                                     4,900          86,877
- ---------------------------------------------------------------------------------
Knight Transportation, Inc.                                2,600          64,480



                 19 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

ROAD & RAIL Continued
Laidlaw International, Inc. 1                             14,800   $     316,720
- ---------------------------------------------------------------------------------
Landstar System, Inc. 1                                      900          66,276
- ---------------------------------------------------------------------------------
Marten Transport Ltd. 1                                    1,550          35,232
- ---------------------------------------------------------------------------------
Mullen Transportation, Inc.                                1,300          54,088
- ---------------------------------------------------------------------------------
Old Dominion Freight Line, Inc. 1                            850          29,580
- ---------------------------------------------------------------------------------
Overnite Corp.                                             2,200          81,928
- ---------------------------------------------------------------------------------
Pacer International, Inc. 1                                7,600         161,576
- ---------------------------------------------------------------------------------
RailAmerica, Inc. 1                                        1,300          16,965
- ---------------------------------------------------------------------------------
SCS Transportation, Inc. 1                                 7,600         177,612
- ---------------------------------------------------------------------------------
Swift Transportation Co., Inc. 1                          23,200         498,336
- ---------------------------------------------------------------------------------
U.S. Xpress Enterprises, Inc., Cl. A 1                     8,100         237,330
- ---------------------------------------------------------------------------------
USF Corp.                                                  5,000         189,750
- ---------------------------------------------------------------------------------
Werner Enterprises, Inc.                                  14,800         335,072
                                                                   --------------
                                                                       4,083,679

- ---------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--0.5%
Aceto Corp.                                                3,400          64,736
- ---------------------------------------------------------------------------------
Applied Industrial Technologies, Inc.                     13,250         363,050
- ---------------------------------------------------------------------------------
Hughes Supply, Inc.                                        4,800         155,280
- ---------------------------------------------------------------------------------
Lawson Products, Inc.                                        500          25,215
- ---------------------------------------------------------------------------------
MSC Industrial Direct Co., Inc., Cl. A                     2,900         104,342
- ---------------------------------------------------------------------------------
UAP Holding Corp. 1                                       15,500         267,685
- ---------------------------------------------------------------------------------
W.W. Grainger, Inc.                                        2,300         153,226
                                                                   --------------
                                                                       1,133,534

- ---------------------------------------------------------------------------------
TRANSPORTATION INFRASTRUCTURE--0.1%
Macquarie Infrastructure Co. Trust 1                       7,000         205,450
- ---------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--21.1%
- ---------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--2.9%
3Com Corp. 1                                              14,900          62,133
- ---------------------------------------------------------------------------------
ADTRAN, Inc.                                               7,100         135,894
- ---------------------------------------------------------------------------------
Airspan Networks, Inc. 1                                   5,000          27,150
- ---------------------------------------------------------------------------------
Anaren Microwave, Inc. 1                                   6,700          86,832
- ---------------------------------------------------------------------------------
Aspect Communications Corp. 1                             15,400         171,556
- ---------------------------------------------------------------------------------
Audiovox Corp., Cl. A 1                                    3,900          61,542
- ---------------------------------------------------------------------------------
Bel Fuse, Inc.                                               200           6,758
- ---------------------------------------------------------------------------------
Black Box Corp.                                            7,100         340,942
- ---------------------------------------------------------------------------------
Brocade Communications Systems, Inc. 1                    52,700         402,628
- ---------------------------------------------------------------------------------
Brooktrout, Inc. 1                                         3,000          36,030
- ---------------------------------------------------------------------------------
C-COR.net Corp. 1                                          5,200          48,360
- ---------------------------------------------------------------------------------
Carrier Access Corp. 1                                     2,000          21,360
- ---------------------------------------------------------------------------------
Ciena Corp. 1                                             58,600         195,724
- ---------------------------------------------------------------------------------
CommScope, Inc. 1                                          7,400         139,860
- ---------------------------------------------------------------------------------
Comtech Telecommunications Corp. 1                         2,300          86,503
- ---------------------------------------------------------------------------------
Comverse Technology, Inc. 1                               10,700         261,615
- ---------------------------------------------------------------------------------
Digi International, Inc. 1                                17,100         293,949


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMMUNICATIONS EQUIPMENT Continued
Ditech Communications Corp. 1                             18,000   $     269,100
- ---------------------------------------------------------------------------------
Eagle Broadband, Inc. 1                                   33,600          22,176
- ---------------------------------------------------------------------------------
Extreme Networks, Inc. 1                                  26,000         170,300
- ---------------------------------------------------------------------------------
F5 Networks, Inc. 1                                        3,000         146,160
- ---------------------------------------------------------------------------------
Finisar Corp. 1                                           46,400         105,792
- ---------------------------------------------------------------------------------
Foundry Networks, Inc. 1                                   3,000          39,480
- ---------------------------------------------------------------------------------
Harmonic, Inc. 1                                          15,600         130,104
- ---------------------------------------------------------------------------------
Harris Corp.                                               2,400         148,296
- ---------------------------------------------------------------------------------
Inter-Tel, Inc.                                            3,900         106,782
- ---------------------------------------------------------------------------------
InterDigital Communications Corp. 1                          800          17,680
- ---------------------------------------------------------------------------------
McDATA Corp., Cl. A 1                                     10,700          63,772
- ---------------------------------------------------------------------------------
Mobility Electronics, Inc. 1                               9,800          84,084
- ---------------------------------------------------------------------------------
MRV Communications, Inc. 1                                13,100          48,077
- ---------------------------------------------------------------------------------
Netgear, Inc. 1                                           11,700         212,823
- ---------------------------------------------------------------------------------
NMS Communications Corp. 1                                26,100         164,691
- ---------------------------------------------------------------------------------
Optical Communication Products, Inc. 1                       400           1,000
- ---------------------------------------------------------------------------------
Packeteer, Inc. 1                                         13,200         190,740
- ---------------------------------------------------------------------------------
Paradyne Networks, Inc. 1                                 21,100          75,749
- ---------------------------------------------------------------------------------
Performance Technologies, Inc. 1                          10,300          95,790
- ---------------------------------------------------------------------------------
Plantronics, Inc.                                          1,200          49,764
- ---------------------------------------------------------------------------------
Polycom, Inc. 1                                           10,400         242,528
- ---------------------------------------------------------------------------------
Powerwave Technologies, Inc. 1                            18,400         156,032
- ---------------------------------------------------------------------------------
QLogic Corp. 1                                             1,700          62,441
- ---------------------------------------------------------------------------------
REMEC, Inc. 1                                              9,400          67,774
- ---------------------------------------------------------------------------------
Scientific-Atlanta, Inc.                                   2,900          95,729
- ---------------------------------------------------------------------------------
SeaChange International, Inc. 1                           13,500         235,440
- ---------------------------------------------------------------------------------
Sonus Networks, Inc. 1                                    27,100         155,283
- ---------------------------------------------------------------------------------
SpectraLink Corp.                                          5,600          79,408
- ---------------------------------------------------------------------------------
Superior Essex, Inc. 1                                     2,200          41,349
- ---------------------------------------------------------------------------------
Sycamore Networks, Inc. 1                                 37,700         153,062
- ---------------------------------------------------------------------------------
Symmetricom, Inc. 1                                       31,100         301,981
- ---------------------------------------------------------------------------------
Tellabs, Inc. 1                                           14,400         123,696
- ---------------------------------------------------------------------------------
ViaSat, Inc. 1                                               500          12,135
                                                                   --------------
                                                                       6,248,054

- ---------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--1.3%
ActivCard Corp. 1                                          3,000          26,700
- ---------------------------------------------------------------------------------
Advanced Digital Information Corp. 1                       4,200          42,084
- ---------------------------------------------------------------------------------
Avid Technology, Inc. 1                                    2,400         148,200
- ---------------------------------------------------------------------------------
Electronics for Imaging, Inc. 1                           11,800         205,438
- ---------------------------------------------------------------------------------
Hutchinson Technology, Inc. 1                              4,900         169,393
- ---------------------------------------------------------------------------------
InFocus Corp. 1                                           17,800         163,048
- ---------------------------------------------------------------------------------
Maxtor Corp. 1                                            33,700         178,610
- ---------------------------------------------------------------------------------
NCR Corp. 1                                                3,200         221,536
- ---------------------------------------------------------------------------------
Novatel Wireless, Inc. 1                                   8,500         164,730
- ---------------------------------------------------------------------------------
Overland Storage, Inc. 1                                   1,600          26,704



                 20 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

COMPUTERS & PERIPHERALS Continued
PalmOne, Inc. 1                                            2,600   $      82,030
- ---------------------------------------------------------------------------------
Pinnacle Systems, Inc. 1                                  23,100         140,910
- ---------------------------------------------------------------------------------
Presstek, Inc. 1                                           6,600          63,888
- ---------------------------------------------------------------------------------
Quantum Corp. 1                                           20,000          52,400
- ---------------------------------------------------------------------------------
Rimage Corp. 1                                               500           8,030
- ---------------------------------------------------------------------------------
SBS Technologies, Inc. 1                                   7,000          97,720
- ---------------------------------------------------------------------------------
Silicon Graphics, Inc. 1                                  87,100         150,683
- ---------------------------------------------------------------------------------
SimpleTech, Inc. 1                                        10,500          48,300
- ---------------------------------------------------------------------------------
Storage Technology Corp. 1                                 6,700         211,787
- ---------------------------------------------------------------------------------
Stratasys, Inc. 1                                          3,400         114,104
- ---------------------------------------------------------------------------------
Synaptics, Inc. 1                                          3,900         119,262
- ---------------------------------------------------------------------------------
Western Digital Corp. 1                                   17,100         185,364
- ---------------------------------------------------------------------------------
Xybernaut Corp. 1                                         21,200          26,076
                                                                   --------------
                                                                       2,646,997

- ---------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--3.5%
Agilysys, Inc.                                            18,300         313,662
- ---------------------------------------------------------------------------------
Amphenol Corp., Cl. A 1                                    4,800         176,352
- ---------------------------------------------------------------------------------
Anixter International, Inc.                                6,800         244,732
- ---------------------------------------------------------------------------------
AVX Corp.                                                 13,100         165,060
- ---------------------------------------------------------------------------------
BEI Technologies, Inc.                                     8,000         247,040
- ---------------------------------------------------------------------------------
Belden CDT, Inc.                                           8,900         206,480
- ---------------------------------------------------------------------------------
Brightpoint, Inc. 1                                       15,200         297,008
- ---------------------------------------------------------------------------------
Cogent, Inc. 1                                               600          19,800
- ---------------------------------------------------------------------------------
Cognex Corp.                                              10,700         298,530
- ---------------------------------------------------------------------------------
Coherent, Inc. 1                                           4,800         146,112
- ---------------------------------------------------------------------------------
CTS Corp.                                                  1,400          18,606
- ---------------------------------------------------------------------------------
CyberOptics Corp. 1                                        1,600          23,792
- ---------------------------------------------------------------------------------
Daktronics, Inc. 1                                         2,300          57,247
- ---------------------------------------------------------------------------------
Dionex Corp. 1                                             5,800         328,686
- ---------------------------------------------------------------------------------
Electro Scientific Industries, Inc. 1                     11,700         231,192
- ---------------------------------------------------------------------------------
Excel Technology, Inc. 1                                   1,300          33,800
- ---------------------------------------------------------------------------------
GTSI Corp. 1                                                 400           4,204
- ---------------------------------------------------------------------------------
Hypercom Corp. 1                                          18,400         108,928
- ---------------------------------------------------------------------------------
Identix, Inc. 1                                           30,000         221,400
- ---------------------------------------------------------------------------------
Ingram Micro, Inc., Cl. A 1                                6,500         135,200
- ---------------------------------------------------------------------------------
Jabil Circuit, Inc. 1                                      4,800         122,784
- ---------------------------------------------------------------------------------
Keithley Instruments, Inc.                                 7,400         145,780
- ---------------------------------------------------------------------------------
Kemet Corp. 1                                             16,500         147,675
- ---------------------------------------------------------------------------------
Landauer, Inc.                                               200           9,140
- ---------------------------------------------------------------------------------
LeCroy Corp. 1                                             1,500          35,010
- ---------------------------------------------------------------------------------
Littlefuse, Inc. 1                                         6,800         232,288
- ---------------------------------------------------------------------------------
LoJack Corp. 1                                             5,500          66,715
- ---------------------------------------------------------------------------------
Maxwell Technologies, Inc. 1                               1,500          15,210
- ---------------------------------------------------------------------------------
Measurement Specialties, Inc. 1                            4,300         109,478
- ---------------------------------------------------------------------------------
Mettler-Toledo International, Inc. 1                       2,900         148,799


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

ELECTRONIC EQUIPMENT & INSTRUMENTS Continued
MTS Systems Corp.                                          6,300   $     213,003
- ---------------------------------------------------------------------------------
Park Electrochemical Corp.                                 4,700         101,896
- ---------------------------------------------------------------------------------
Paxar Corp. 1                                             21,600         478,872
- ---------------------------------------------------------------------------------
PC Connection, Inc. 1                                      5,700          54,264
- ---------------------------------------------------------------------------------
Photon Dynamics, Inc. 1                                    5,800         140,824
- ---------------------------------------------------------------------------------
Planar Systems, Inc. 1                                     9,000         101,070
- ---------------------------------------------------------------------------------
Rofin-Sinar Technologies, Inc. 1                           1,800          76,410
- ---------------------------------------------------------------------------------
Sanmina-SCI Corp. 1                                       15,900         134,673
- ---------------------------------------------------------------------------------
ScanSource, Inc. 1                                         3,200         198,912
- ---------------------------------------------------------------------------------
Solectron Corp. 1                                          1,800           9,594
- ---------------------------------------------------------------------------------
SpatiaLight, Inc. 1                                        6,800          60,860
- ---------------------------------------------------------------------------------
Symbol Technologies, Inc.                                  2,900          50,170
- ---------------------------------------------------------------------------------
Taser International, Inc. 1                                9,000         284,310
- ---------------------------------------------------------------------------------
Tech Data Corp. 1                                          7,800         354,120
- ---------------------------------------------------------------------------------
Tektronix, Inc.                                              200           6,042
- ---------------------------------------------------------------------------------
Trimble Navigation Ltd. 1                                  8,450         279,188
- ---------------------------------------------------------------------------------
TTM Technologies, Inc. 1                                   8,100          95,580
- ---------------------------------------------------------------------------------
UNOVA, Inc. 1                                              6,900         174,501
- ---------------------------------------------------------------------------------
Veeco Instruments, Inc. 1                                  3,200          67,424
- ---------------------------------------------------------------------------------
Viisage Technology, Inc. 1                                21,900         197,319
- ---------------------------------------------------------------------------------
Zygo Corp. 1                                               4,200          49,518
                                                                   --------------
                                                                       7,439,260

- ---------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--2.3%
Akamai Technologies, Inc. 1                                5,700          74,271
- ---------------------------------------------------------------------------------
Aladdin Knowledge Systems Ltd. 1                           1,500          37,125
- ---------------------------------------------------------------------------------
AsiaInfo Holdings, Inc. 1                                 13,600          81,056
- ---------------------------------------------------------------------------------
Chordiant Software, Inc. 1                                19,700          44,916
- ---------------------------------------------------------------------------------
CMGI, Inc. 1                                              61,300         156,315
- ---------------------------------------------------------------------------------
Corillian Corp. 1                                         24,500         120,540
- ---------------------------------------------------------------------------------
Covansys Corp. 1                                           6,300          96,390
- ---------------------------------------------------------------------------------
CyberSource Corp. 1                                       17,000         121,550
- ---------------------------------------------------------------------------------
Digital River, Inc. 1                                      2,500         104,025
- ---------------------------------------------------------------------------------
DoubleClick, Inc. 1                                       31,800         247,404
- ---------------------------------------------------------------------------------
EarthLink, Inc. 1                                         49,900         574,848
- ---------------------------------------------------------------------------------
Embarcadero Technologies, Inc. 1                           5,800          54,578
- ---------------------------------------------------------------------------------
HouseValues, Inc. 1                                        1,900          28,538
- ---------------------------------------------------------------------------------
InfoSpace, Inc. 1                                          6,100         290,055
- ---------------------------------------------------------------------------------
Internet Capital Group, Inc. 1                             7,600          68,400
- ---------------------------------------------------------------------------------
Internet Security Systems, Inc. 1                         11,400         265,050
- ---------------------------------------------------------------------------------
Interwoven, Inc. 1                                        15,400         167,552
- ---------------------------------------------------------------------------------
Ivillage, Inc. 1                                          23,200         143,376
- ---------------------------------------------------------------------------------
Keynote Systems, Inc. 1                                    3,000          41,760
- ---------------------------------------------------------------------------------
Lionbridge Technologies, Inc. 1                            1,600          10,752
- ---------------------------------------------------------------------------------
LookSmart Ltd. 1                                          28,400          62,196
- ---------------------------------------------------------------------------------
MarketWatch, Inc. 1                                          700          12,600



                 21 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

INTERNET SOFTWARE & SERVICES Continued
MatrixOne, Inc. 1                                         11,500   $      75,325
- ---------------------------------------------------------------------------------
MicroStrategy, Inc., Cl. A 1                               1,400          84,350
- ---------------------------------------------------------------------------------
NetRatings, Inc. 1                                         3,000          57,510
- ---------------------------------------------------------------------------------
OpenTV Corp. 1                                             9,600          36,864
- ---------------------------------------------------------------------------------
PEC Solutions, Inc. 1                                      2,000          28,340
- ---------------------------------------------------------------------------------
Retek, Inc. 1                                             18,800         115,620
- ---------------------------------------------------------------------------------
S1 Corp. 1                                                23,800         215,628
- ---------------------------------------------------------------------------------
Selectica, Inc. 1                                          3,400          12,172
- ---------------------------------------------------------------------------------
SonicWALL, Inc. 1                                         35,100         221,832
- ---------------------------------------------------------------------------------
SupportSoft, Inc. 1                                        8,900          59,274
- ---------------------------------------------------------------------------------
United Online, Inc. 1                                     31,300         360,889
- ---------------------------------------------------------------------------------
ValueClick, Inc. 1                                        21,900         291,927
- ---------------------------------------------------------------------------------
VeriSign, Inc. 1                                           3,700         124,024
- ---------------------------------------------------------------------------------
WebEx Communications, Inc. 1                                 500          11,890
- ---------------------------------------------------------------------------------
webMethods, Inc. 1                                         4,100          29,561
- ---------------------------------------------------------------------------------
Websense, Inc. 1                                           5,600         284,032
                                                                   --------------
                                                                       4,812,535

- ---------------------------------------------------------------------------------
IT SERVICES--1.8%
Acxiom Corp.                                              17,200         452,360
- ---------------------------------------------------------------------------------
Alliance Data Systems Corp. 1                              1,800          85,464
- ---------------------------------------------------------------------------------
American Software, Inc.                                    3,100          18,693
- ---------------------------------------------------------------------------------
Answerthink, Inc. 1                                       10,800          50,328
- ---------------------------------------------------------------------------------
Anteon International Corp. 1                               1,600          66,976
- ---------------------------------------------------------------------------------
Aquantive, Inc. 1                                          4,300          38,442
- ---------------------------------------------------------------------------------
BISYS Group, Inc. (The) 1                                 12,100         199,045
- ---------------------------------------------------------------------------------
CheckFree Corp. 1                                          6,700         255,136
- ---------------------------------------------------------------------------------
Convergys Corp. 1                                          8,800         131,912
- ---------------------------------------------------------------------------------
CSG Systems International, Inc. 1                         14,000         261,800
- ---------------------------------------------------------------------------------
eFunds Corp. 1                                            15,100         362,551
- ---------------------------------------------------------------------------------
Euronet Worldwide, Inc. 1                                  4,100         106,682
- ---------------------------------------------------------------------------------
Information Resources, Inc. 1                              3,500           3,535
- ---------------------------------------------------------------------------------
infoUSA, Inc. 1                                           18,500         207,015
- ---------------------------------------------------------------------------------
Integral Systems, Inc.                                       100           1,945
- ---------------------------------------------------------------------------------
iPayment Holdings, Inc. 1                                  2,500         123,800
- ---------------------------------------------------------------------------------
Keane, Inc. 1                                              1,600          23,520
- ---------------------------------------------------------------------------------
Lawson Software, Inc. 1                                   24,500         168,315
- ---------------------------------------------------------------------------------
Manhattan Associates, Inc. 1                                 200           4,776
- ---------------------------------------------------------------------------------
ManTech International Corp. 1                              2,400          56,976
- ---------------------------------------------------------------------------------
MPS Group, Inc. 1                                         14,500         177,770
- ---------------------------------------------------------------------------------
NetScout Systems, Inc. 1                                     200           1,396
- ---------------------------------------------------------------------------------
Pegasus Solutions, Inc. 1                                  3,000          37,800
- ---------------------------------------------------------------------------------
Perot Systems Corp., Cl. A 1                               3,100          49,693
- ---------------------------------------------------------------------------------
RightNow Technologies, Inc. 1                              4,700          75,905
- ---------------------------------------------------------------------------------
Sabre Holdings Corp.                                       6,400         141,824
- ---------------------------------------------------------------------------------
Sapient Corp. 1                                           39,400         311,654


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

IT SERVICES Continued
SRA International, Inc., Cl. A 1                           1,800   $     115,560
- ---------------------------------------------------------------------------------
SS&C Technologies, Inc.                                    8,300         171,395
- ---------------------------------------------------------------------------------
Startek, Inc.                                              4,400         125,180
- ---------------------------------------------------------------------------------
TNS, Inc. 1                                                  900          19,665
                                                                   --------------
                                                                       3,847,113

- ---------------------------------------------------------------------------------
OFFICE ELECTRONICS--0.0%
TransAct Technologies, Inc. 1                              3,750          80,100
- ---------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--4.7%
Actel Corp. 1                                              9,700         170,138
- ---------------------------------------------------------------------------------
ADE Corp. 1                                                4,500          84,240
- ---------------------------------------------------------------------------------
Advanced Energy Industries, Inc. 1                        13,800         125,994
- ---------------------------------------------------------------------------------
Agere Systems, Inc., Cl. A 1                              88,900         121,793
- ---------------------------------------------------------------------------------
Applied Micro Circuits Corp. 1                            74,700         314,487
- ---------------------------------------------------------------------------------
Atheros Communications, Inc. 1                             4,800          49,200
- ---------------------------------------------------------------------------------
Atmel Corp. 1                                            113,400         444,528
- ---------------------------------------------------------------------------------
ATMI, Inc. 1                                              11,900         268,107
- ---------------------------------------------------------------------------------
Axcelis Technologies, Inc. 1                              30,500         247,965
- ---------------------------------------------------------------------------------
Cabot Microelectronics Corp. 1                             6,800         272,340
- ---------------------------------------------------------------------------------
Cascade Microtech, Inc. 1                                  5,000          67,100
- ---------------------------------------------------------------------------------
Cirrus Logic, Inc. 1                                      31,100         171,361
- ---------------------------------------------------------------------------------
Cohu, Inc.                                                 5,300          98,368
- ---------------------------------------------------------------------------------
Cree, Inc. 1                                              10,000         400,800
- ---------------------------------------------------------------------------------
Cymer, Inc. 1                                              3,700         109,298
- ---------------------------------------------------------------------------------
Cypress Semiconductor Corp. 1                              6,900          80,937
- ---------------------------------------------------------------------------------
Diodes, Inc. 1                                             8,150         184,435
- ---------------------------------------------------------------------------------
DSP Group, Inc. 1                                         10,900         243,397
- ---------------------------------------------------------------------------------
Entegris, Inc. 1                                           8,100          80,595
- ---------------------------------------------------------------------------------
Exar Corp. 1                                               5,000          70,950
- ---------------------------------------------------------------------------------
Fairchild Semiconductor International, Inc., Cl. A 1      10,800         175,608
- ---------------------------------------------------------------------------------
FormFactor, Inc. 1                                         5,300         143,842
- ---------------------------------------------------------------------------------
Genesis Microchip, Inc. 1                                  1,300          21,086
- ---------------------------------------------------------------------------------
Helix Technology Corp.                                    11,100         193,029
- ---------------------------------------------------------------------------------
Integrated Circuit Systems, Inc. 1                         7,300         152,716
- ---------------------------------------------------------------------------------
Integrated Device Technology, Inc. 1                      24,100         278,596
- ---------------------------------------------------------------------------------
International Rectifier Corp. 1                              800          35,656
- ---------------------------------------------------------------------------------
Intersil Corp., Cl. A                                     17,400         291,276
- ---------------------------------------------------------------------------------
Kopin Corp. 1                                             10,600          41,022
- ---------------------------------------------------------------------------------
Kulicke & Soffa Industries, Inc. 1                        10,900          93,958
- ---------------------------------------------------------------------------------
Lam Research Corp. 1                                       5,100         147,441
- ---------------------------------------------------------------------------------
Lattice Semiconductor Corp. 1                             29,100         165,870
- ---------------------------------------------------------------------------------
LSI Logic Corp. 1                                         39,000         213,720
- ---------------------------------------------------------------------------------
MEMC Electronic Materials, Inc. 1                         11,600         153,700
- ---------------------------------------------------------------------------------
Micrel, Inc. 1                                            40,400         445,208
- ---------------------------------------------------------------------------------
Microsemi Corp. 1                                         26,500         460,040



                 22 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT Continued
Microtune, Inc. 1                                         24,900   $     152,139
- ---------------------------------------------------------------------------------
Mindspeed Technologies, Inc. 1                             7,900          21,962
- ---------------------------------------------------------------------------------
MIPS Technologies, Inc., Cl. A 1                          12,000         118,200
- ---------------------------------------------------------------------------------
Monolithic System Technology, Inc. 1                       1,000           6,230
- ---------------------------------------------------------------------------------
Mykrolis Corp. 1                                          16,400         232,388
- ---------------------------------------------------------------------------------
Nanometrics, Inc. 1                                        3,800          61,252
- ---------------------------------------------------------------------------------
OmniVision Technologies, Inc. 1                            2,500          45,875
- ---------------------------------------------------------------------------------
PDF Solutions, Inc. 1                                      3,200          51,552
- ---------------------------------------------------------------------------------
Photronics, Inc. 1                                        13,600         224,400
- ---------------------------------------------------------------------------------
Pixelworks, Inc. 1                                         6,800          77,112
- ---------------------------------------------------------------------------------
PLX Technology, Inc. 1                                     4,700          48,880
- ---------------------------------------------------------------------------------
PMC-Sierra, Inc. 1                                        12,900         145,125
- ---------------------------------------------------------------------------------
Rambus, Inc. 1                                             7,200         165,600
- ---------------------------------------------------------------------------------
RF Micro Devices, Inc. 1                                   5,800          39,672
- ---------------------------------------------------------------------------------
Rudolph Technologies, Inc. 1                               7,200         123,624
- ---------------------------------------------------------------------------------
Semtech Corp. 1                                            4,200          91,854
- ---------------------------------------------------------------------------------
Sigmatel, Inc. 1                                           4,900         174,097
- ---------------------------------------------------------------------------------
Silicon Image, Inc. 1                                     21,000         345,660
- ---------------------------------------------------------------------------------
Silicon Storage Technology, Inc. 1                        39,700         236,215
- ---------------------------------------------------------------------------------
Siliconix, Inc. 1                                            200           7,298
- ---------------------------------------------------------------------------------
Skyworks Solutions, Inc. 1                                13,300         125,419
- ---------------------------------------------------------------------------------
Standard Microsystems Corp. 1                              3,400          60,622
- ---------------------------------------------------------------------------------
Supertex, Inc. 1                                             300           6,510
- ---------------------------------------------------------------------------------
Teradyne, Inc. 1                                           5,900         100,713
- ---------------------------------------------------------------------------------
Tessera Technologies, Inc. 1                               4,800         178,608
- ---------------------------------------------------------------------------------
Trident Microsystems, Inc. 1                               5,500          91,960
- ---------------------------------------------------------------------------------
Ultra Clean Holdings, Inc. 1                               2,900          17,574
- ---------------------------------------------------------------------------------
Ultratech, Inc. 1                                          6,700         126,295
- ---------------------------------------------------------------------------------
Varian Semiconductor Equipment Associates, Inc. 1          2,100          77,385
- ---------------------------------------------------------------------------------
Virage Logic Corp. 1                                       6,200         115,134
                                                                   --------------
                                                                       9,888,156

- ---------------------------------------------------------------------------------
SOFTWARE--4.6%
Activision, Inc. 1                                        10,150         204,827
- ---------------------------------------------------------------------------------
Actuate Corp. 1                                            5,600          14,280
- ---------------------------------------------------------------------------------
Advent Software, Inc. 1                                    3,900          79,872
- ---------------------------------------------------------------------------------
Agile Software Corp. 1                                     4,300          35,131
- ---------------------------------------------------------------------------------
Amdocs Ltd. 1                                              2,300          60,375
- ---------------------------------------------------------------------------------
Ansoft Corp. 1                                             4,000          80,800
- ---------------------------------------------------------------------------------
Ansys, Inc. 1                                             15,600         500,136
- ---------------------------------------------------------------------------------
Ascential Software Corp. 1                                 6,300         102,753
- ---------------------------------------------------------------------------------
Aspen Technology, Inc. 1                                   5,700          35,397
- ---------------------------------------------------------------------------------
Autodesk, Inc.                                             2,600          98,670
- ---------------------------------------------------------------------------------
BEA Systems, Inc. 1                                       14,000         124,040
- ---------------------------------------------------------------------------------
Blackbaud, Inc. 1                                            600           8,784


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

SOFTWARE Continued
BMC Software, Inc. 1                                      10,500   $     195,300
- ---------------------------------------------------------------------------------
Borland Software Corp. 1                                  22,100         258,128
- ---------------------------------------------------------------------------------
Cadence Design Systems, Inc. 1                             2,000          27,620
- ---------------------------------------------------------------------------------
Catapult Communications Corp. 1                            6,300         152,208
- ---------------------------------------------------------------------------------
CCC Information Services Group, Inc. 1                       400           8,884
- ---------------------------------------------------------------------------------
Cognos, Inc. 1                                             2,700         118,962
- ---------------------------------------------------------------------------------
Compuware Corp. 1                                         21,100         136,517
- ---------------------------------------------------------------------------------
Concur Technologies, Inc. 1                                  600           5,346
- ---------------------------------------------------------------------------------
E.piphany, Inc. 1                                          8,500          41,055
- ---------------------------------------------------------------------------------
Entrust Technologies, Inc. 1                              21,400          81,106
- ---------------------------------------------------------------------------------
ePlus, inc. 1                                              1,700          20,077
- ---------------------------------------------------------------------------------
FactSet Research Systems, Inc.                             4,900         286,356
- ---------------------------------------------------------------------------------
Fair Isaac Corp.                                           4,500         165,060
- ---------------------------------------------------------------------------------
FileNet Corp. 1                                            6,500         167,440
- ---------------------------------------------------------------------------------
Hyperion Solutions Corp. 1                                 2,300         107,226
- ---------------------------------------------------------------------------------
Informatica Corp. 1                                       17,600         142,912
- ---------------------------------------------------------------------------------
InterVoice-Brite, Inc. 1                                  12,400         165,540
- ---------------------------------------------------------------------------------
JDA Software Group, Inc. 1                                 1,400          19,068
- ---------------------------------------------------------------------------------
Kronos, Inc. 1                                             6,150         314,450
- ---------------------------------------------------------------------------------
Macromedia, Inc. 1                                         5,100         158,712
- ---------------------------------------------------------------------------------
Macrovision Corp. 1                                        8,700         223,764
- ---------------------------------------------------------------------------------
Manugistics Group, Inc. 1                                 15,100          43,337
- ---------------------------------------------------------------------------------
McAfee, Inc. 1                                             7,900         228,547
- ---------------------------------------------------------------------------------
Micromuse, Inc. 1                                         16,500          91,575
- ---------------------------------------------------------------------------------
MICROS Systems, Inc. 1                                     1,500         117,090
- ---------------------------------------------------------------------------------
Midway Games, Inc. 1                                       6,400          67,200
- ---------------------------------------------------------------------------------
Mobius Management Systems, Inc. 1                          4,000          29,016
- ---------------------------------------------------------------------------------
MRO Software, Inc. 1                                       5,600          72,912
- ---------------------------------------------------------------------------------
MSC.Software Corp. 1                                         600           6,282
- ---------------------------------------------------------------------------------
NetIQ Corp. 1                                             11,400         139,194
- ---------------------------------------------------------------------------------
Open Solutions, Inc. 1                                       600          15,576
- ---------------------------------------------------------------------------------
OPNET Technologies, Inc. 1                                 1,500          12,630
- ---------------------------------------------------------------------------------
PalmSource, Inc. 1                                         4,500          57,330
- ---------------------------------------------------------------------------------
Parametric Technology Corp. 1                             93,700         551,893
- ---------------------------------------------------------------------------------
Pervasive Software, Inc. 1                                   200             970
- ---------------------------------------------------------------------------------
Progress Software Corp. 1                                  1,600          37,360
- ---------------------------------------------------------------------------------
Quality Systems, Inc. 1                                    3,000         179,400
- ---------------------------------------------------------------------------------
Quest Software, Inc. 1                                     2,200          35,090
- ---------------------------------------------------------------------------------
RSA Security, Inc. 1                                      17,900         359,074
- ---------------------------------------------------------------------------------
Siebel Systems, Inc. 1                                     7,400          77,700
- ---------------------------------------------------------------------------------
SoftBrands, Inc. 1                                         1,900           4,180
- ---------------------------------------------------------------------------------
Sonic Solutions, Inc. 1                                    6,200         139,128
- ---------------------------------------------------------------------------------
Sybase, Inc. 1                                            27,800         554,610
- ---------------------------------------------------------------------------------
Synopsys, Inc. 1                                           7,700         151,074
- ---------------------------------------------------------------------------------
Synplicity, Inc. 1                                         1,100           6,512



                 23 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

SOFTWARE Continued
Take-Two Interactive Software, Inc. 1                     10,500   $     365,295
- ---------------------------------------------------------------------------------
THQ, Inc. 1                                               16,400         376,216
- ---------------------------------------------------------------------------------
TIBCO Software, Inc. 1                                    43,500         580,290
- ---------------------------------------------------------------------------------
Transaction Systems Architects, Inc., Cl. A 1              5,600         111,160
- ---------------------------------------------------------------------------------
Ulticom, Inc. 1                                           11,100         177,933
- ---------------------------------------------------------------------------------
Verint Systems, Inc. 1                                     2,700          98,091
- ---------------------------------------------------------------------------------
Verity, Inc. 1                                            10,900         143,008
- ---------------------------------------------------------------------------------
Wind River Systems, Inc. 1                                35,700         483,735
- ---------------------------------------------------------------------------------
Witness Systems, Inc. 1                                   15,300         267,138
                                                                   --------------
                                                                       9,721,342

- ---------------------------------------------------------------------------------
MATERIALS--7.0%
- ---------------------------------------------------------------------------------
CHEMICALS--2.4%
Agrium, Inc.                                               6,500         109,525
- ---------------------------------------------------------------------------------
Albemarle Corp.                                            3,400         131,614
- ---------------------------------------------------------------------------------
American Vanguard Corp.                                      800          29,424
- ---------------------------------------------------------------------------------
Arch Chemicals, Inc.                                       7,000         201,460
- ---------------------------------------------------------------------------------
Cabot Corp.                                               10,700         413,876
- ---------------------------------------------------------------------------------
Cambrex Corp.                                              2,500          67,750
- ---------------------------------------------------------------------------------
Compass Minerals International, Inc.                      12,100         293,183
- ---------------------------------------------------------------------------------
Crompton Corp.                                            17,100         201,780
- ---------------------------------------------------------------------------------
Cytec Industries, Inc.                                     2,500         128,550
- ---------------------------------------------------------------------------------
Eastman Chemical Co.                                       2,800         161,644
- ---------------------------------------------------------------------------------
Engelhard Corp.                                            2,300          70,541
- ---------------------------------------------------------------------------------
FMC Corp. 1                                               11,100         536,130
- ---------------------------------------------------------------------------------
Fuller (H.B.) Co.                                          3,000          85,530
- ---------------------------------------------------------------------------------
Georgia Gulf Corp.                                         9,400         468,120
- ---------------------------------------------------------------------------------
Great Lakes Chemical Corp.                                 8,700         247,863
- ---------------------------------------------------------------------------------
Hercules, Inc. 1                                           1,500          22,275
- ---------------------------------------------------------------------------------
MacDermid, Inc.                                           11,000         397,100
- ---------------------------------------------------------------------------------
Material Sciences Corp. 1                                    400           7,196
- ---------------------------------------------------------------------------------
Minerals Technologies, Inc.                                1,500         100,050
- ---------------------------------------------------------------------------------
Mosaic Co. (The) 1                                         4,900          79,968
- ---------------------------------------------------------------------------------
OM Group, Inc. 1                                           6,300         204,246
- ---------------------------------------------------------------------------------
Omnova Solutions, Inc. 1                                   3,300          18,546
- ---------------------------------------------------------------------------------
PolyOne Corp. 1                                           13,900         125,934
- ---------------------------------------------------------------------------------
Schulman (A.), Inc.                                        4,200          89,922
- ---------------------------------------------------------------------------------
Scotts Co. (The), Cl. A 1                                  2,800         205,856
- ---------------------------------------------------------------------------------
Stepan Co.                                                 1,400          34,104
- ---------------------------------------------------------------------------------
Terra Industries, Inc. 1                                  36,100         320,568
- ---------------------------------------------------------------------------------
Valspar Corp. (The)                                          600          30,006
- ---------------------------------------------------------------------------------
W.R. Grace & Co. 1                                        15,200         206,872
- ---------------------------------------------------------------------------------
Westlake Chemical Corp.                                    5,100         170,340
                                                                   --------------
                                                                       5,159,973


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

CONSTRUCTION MATERIALS--0.6%
AMCOL International Corp.                                  4,900   $      98,441
- ---------------------------------------------------------------------------------
Eagle Materials, Inc.                                      5,600         483,560
- ---------------------------------------------------------------------------------
Eagle Materials, Inc., Cl. B                                 100           8,430
- ---------------------------------------------------------------------------------
Florida Rock Industries, Inc.                              1,400          83,342
- ---------------------------------------------------------------------------------
Martin Marietta Materials, Inc.                            4,700         252,202
- ---------------------------------------------------------------------------------
Texas Industries, Inc.                                     3,100         193,378
- ---------------------------------------------------------------------------------
Vulcan Materials Co.                                       2,400         131,064
                                                                   --------------
                                                                       1,250,417

- ---------------------------------------------------------------------------------
CONTAINERS & PACKAGING--1.3%
AptarGroup, Inc.                                           3,500         184,730
- ---------------------------------------------------------------------------------
Ball Corp.                                                 1,800          79,164
- ---------------------------------------------------------------------------------
Bemis Co., Inc.                                              900          26,181
- ---------------------------------------------------------------------------------
Caraustar Industries, Inc. 1                               4,600          77,372
- ---------------------------------------------------------------------------------
Crown Holdings, Inc. 1                                    31,900         438,306
- ---------------------------------------------------------------------------------
Graphic Packaging Corp. 1                                  8,900          64,080
- ---------------------------------------------------------------------------------
Greif, Inc., Cl. A                                         8,000         448,000
- ---------------------------------------------------------------------------------
Longview Fibre Co.                                         6,700         121,538
- ---------------------------------------------------------------------------------
Owens-Illinois, Inc. 1                                    15,700         355,605
- ---------------------------------------------------------------------------------
Packaging Corp. of America                                 1,600          37,680
- ---------------------------------------------------------------------------------
Packaging Dynamics Corp.                                     760          10,944
- ---------------------------------------------------------------------------------
Pactiv Corp. 1                                             2,000          50,580
- ---------------------------------------------------------------------------------
Rock-Tenn Co., Cl. A                                       5,700          86,412
- ---------------------------------------------------------------------------------
Silgan Holdings, Inc.                                      9,700         591,312
- ---------------------------------------------------------------------------------
Smurfit-Stone Container Corp.                              4,200          78,456
                                                                   --------------
                                                                       2,650,360

- ---------------------------------------------------------------------------------
METALS & MINING--1.9%
AK Steel Holding Corp. 1                                  40,900         591,823
- ---------------------------------------------------------------------------------
Aleris International, Inc. 1                               3,300          55,836
- ---------------------------------------------------------------------------------
Amerigo Resources Ltd. 1                                  16,000          25,773
- ---------------------------------------------------------------------------------
Brush Engineered Materials, Inc. 1                         5,300          98,050
- ---------------------------------------------------------------------------------
Carpenter Technology Corp.                                 5,800         339,068
- ---------------------------------------------------------------------------------
Castle (A.M.) & Co. 1                                      3,800          45,372
- ---------------------------------------------------------------------------------
Cleveland-Cliffs, Inc.                                     2,200         228,492
- ---------------------------------------------------------------------------------
Commercial Metals Co.                                      3,400         171,904
- ---------------------------------------------------------------------------------
Dynatec Corp. 1                                           73,900          67,846
- ---------------------------------------------------------------------------------
FNX Mining Co., Inc. 1                                    17,200          74,361
- ---------------------------------------------------------------------------------
Foundation Coal Holdings, Inc. 1                           3,500          80,710
- ---------------------------------------------------------------------------------
Goldcorp, Inc.                                             1,500          22,610
- ---------------------------------------------------------------------------------
Inmet Mining Corp. 1                                       8,800         158,204
- ---------------------------------------------------------------------------------
Massey Energy Co.                                          3,200         111,840
- ---------------------------------------------------------------------------------
Meridian Gold, Inc. 1                                        900          17,081
- ---------------------------------------------------------------------------------
Metal Management, Inc.                                     8,500         228,395
- ---------------------------------------------------------------------------------
Olympic Steel, Inc. 1                                      8,700         230,637
- ---------------------------------------------------------------------------------
Oregon Steel Mills, Inc. 1                                 8,500         172,465



                 24 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

METALS & MINING Continued
Quanex Corp.                                                 500   $      34,285
- ---------------------------------------------------------------------------------
Roanoke Electric Steel Corp.                                 500          10,336
- ---------------------------------------------------------------------------------
RTI International Metals, Inc. 1                           2,900          59,566
- ---------------------------------------------------------------------------------
Ryerson Tull, Inc.                                        11,700         184,275
- ---------------------------------------------------------------------------------
Southern Peru Copper Corp.                                 3,400         160,514
- ---------------------------------------------------------------------------------
Steel Dynamics, Inc.                                       2,400          90,912
- ---------------------------------------------------------------------------------
Steel Technologies, Inc.                                   3,900         107,289
- ---------------------------------------------------------------------------------
Stillwater Mining Co. 1                                    9,400         105,844
- ---------------------------------------------------------------------------------
Titanium Metals Corp. 1                                    2,800          67,592
- ---------------------------------------------------------------------------------
United States Steel Corp.                                  2,800         143,500
- ---------------------------------------------------------------------------------
Wheaton River Minerals Ltd. 1                             16,100          52,406
- ---------------------------------------------------------------------------------
Wheeling-Pittsburg Corp. 1                                 2,300          88,642
- ---------------------------------------------------------------------------------
Worthington Industries, Inc.                              11,800         231,044
                                                                   --------------
                                                                       4,056,672

- ---------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--0.8%
Bowater, Inc.                                              2,500         109,925
- ---------------------------------------------------------------------------------
Buckeye Technologies, Inc. 1                               5,300          68,953
- ---------------------------------------------------------------------------------
Deltic Timber Corp.                                          400          16,980
- ---------------------------------------------------------------------------------
Glatfelter                                                11,800         180,304
- ---------------------------------------------------------------------------------
Louisiana-Pacific Corp.                                    9,000         240,660
- ---------------------------------------------------------------------------------
Neenah Paper, Inc. 1                                       5,900         192,340
- ---------------------------------------------------------------------------------
Pope & Talbot, Inc.                                       12,300         210,453
- ---------------------------------------------------------------------------------
Potlatch Corp.                                            10,300         520,974
- ---------------------------------------------------------------------------------
Wausau-Mosinee Paper Corp.                                 8,500         151,810
                                                                   --------------
                                                                       1,692,399

- ---------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--1.0%
- ---------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--0.3%
Alaska Communications Systems Group, Inc. 1                5,000          43,150
- ---------------------------------------------------------------------------------
Arbinet Holdings, Inc. 1                                   3,600          89,460
- ---------------------------------------------------------------------------------
CenturyTel, Inc.                                           4,800         170,256
- ---------------------------------------------------------------------------------
Commonwealth Telephone Enterprises, Inc. 1                   100           4,966
- ---------------------------------------------------------------------------------
Crown Castle International Corp. 1                         3,200          53,248
- ---------------------------------------------------------------------------------
CT Communications, Inc.                                    3,400          41,820
- ---------------------------------------------------------------------------------
D&E Communications, Inc.                                     300           3,615
- ---------------------------------------------------------------------------------
Iowa Telecommunications Services, Inc. 1                   6,700         144,519
- ---------------------------------------------------------------------------------
North Pittsburgh Systems, Inc.                             5,200         128,596
- ---------------------------------------------------------------------------------
Shenandoah Telecommunications Co.                            600          17,970
- ---------------------------------------------------------------------------------
Time Warner Telecom, Inc., Cl. A 1                         1,500           6,540
                                                                   --------------
                                                                         704,140


                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

WIRELESS TELECOMMUNICATION SERVICES--0.7%
@Road, Inc. 1                                              9,000   $      62,190
- ---------------------------------------------------------------------------------
AirGate PCS, Inc. 1                                        1,400          49,840
- ---------------------------------------------------------------------------------
Alamosa Holdings, Inc. 1                                  15,600         194,532
- ---------------------------------------------------------------------------------
Boston Communications Group, Inc. 1                        1,800          16,632
- ---------------------------------------------------------------------------------
InPhonic, Inc. 1                                           3,000          82,440
- ---------------------------------------------------------------------------------
Nextel Partners, Inc., Cl. A 1                             6,400         125,056
- ---------------------------------------------------------------------------------
Price Communications Corp.                                 3,000          55,770
- ---------------------------------------------------------------------------------
SBA Communications Corp. 1                                15,600         144,768
- ---------------------------------------------------------------------------------
Telephone & Data Systems, Inc.                             1,400         107,730
- ---------------------------------------------------------------------------------
UbiquiTel, Inc. 1                                         52,100         370,952
- ---------------------------------------------------------------------------------
United States Cellular Corp. 1                             2,000          89,520
- ---------------------------------------------------------------------------------
USA Mobility, Inc. 1                                       5,400         190,674
                                                                   --------------
                                                                       1,490,104

- ---------------------------------------------------------------------------------
UTILITIES--1.6%
- ---------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.2%
ALLETE, Inc.                                               5,100         187,425
- ---------------------------------------------------------------------------------
Aquila, Inc. 1                                            38,200         140,958
- ---------------------------------------------------------------------------------
Calpine Corp. 1                                           27,900         109,926
- ---------------------------------------------------------------------------------
Canadian Hydro Developers, Inc. 1                         14,000          39,611
- ---------------------------------------------------------------------------------
CH Energy Group, Inc.                                      6,600         317,130
- ---------------------------------------------------------------------------------
CMS Energy Corp. 1                                        42,200         440,990
- ---------------------------------------------------------------------------------
Duquesne Light Holdings, Inc.                                100           1,885
- ---------------------------------------------------------------------------------
El Paso Electric Co. 1                                     5,100          96,594
- ---------------------------------------------------------------------------------
Green Mountain Power Corp.                                 1,000          28,830
- ---------------------------------------------------------------------------------
IDACORP, Inc.                                             13,100         400,467
- ---------------------------------------------------------------------------------
Northeast Utilities Co.                                    4,800          90,480
- ---------------------------------------------------------------------------------
NRG Energy, Inc. 1                                         1,300          46,865
- ---------------------------------------------------------------------------------
Ormat Technologies, Inc. 1                                17,400         283,272
- ---------------------------------------------------------------------------------
PNM Resources, Inc.                                       10,100         255,429
- ---------------------------------------------------------------------------------
Reliant Energy, Inc. 1                                     2,700          36,855
                                                                   --------------
                                                                       2,476,717

- ---------------------------------------------------------------------------------
GAS UTILITIES--0.3%
Atmos Energy Corp.                                         7,400         202,390
- ---------------------------------------------------------------------------------
Chesapeake Utilities Corp.                                 1,300          34,710
- ---------------------------------------------------------------------------------
Energen Corp.                                              2,200         129,690
- ---------------------------------------------------------------------------------
Laclede Group, Inc. (The)                                    600          18,690
- ---------------------------------------------------------------------------------
New Jersey Resources Corp.                                 1,000          43,340
- ---------------------------------------------------------------------------------
Nicor, Inc.                                                1,500          55,410
- ---------------------------------------------------------------------------------
ONEOK, Inc.                                                1,800          51,156
- ---------------------------------------------------------------------------------
Southwest Gas Corp.                                        2,300          58,420
- ---------------------------------------------------------------------------------
WGL Holdings, Inc.                                           200           6,168
                                                                   --------------
                                                                         599,974



                 25 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------



                                                                           VALUE
                                                          SHARES      SEE NOTE 1
- ---------------------------------------------------------------------------------

MULTI-UTILITIES & UNREGULATED POWER--0. 1%
Dynegy, Inc. 1                                             8,500   $      39,270
- ---------------------------------------------------------------------------------
Energy East Corp.                                          1,200          32,000
- ---------------------------------------------------------------------------------
Sierra Pacific Resources 1                                15,100         158,550
                                                                   --------------
                                                                         229,820
                                                                   --------------
Total Common Stocks (Cost $173,806,959)                              208,999,882

- ---------------------------------------------------------------------------------
PREFERRED STOCKS--0.0%
- ---------------------------------------------------------------------------------
Simon Property Group Inc., 6% Cv., Non-Vtg
(Cost $3,212)                                                 60           3,553




                                                       PRINCIPAL
                                                          AMOUNT
- ---------------------------------------------------------------------------------

NON-CONVERTIBLE CORPORATE BONDS AND NOTES--0.0%
- ---------------------------------------------------------------------------------
Mueller Industries, Inc., 6% Sub. Nts.,
11/1/14 (Cost $51,000)                              $     51,000          50,235

- ---------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--2.7%
- ---------------------------------------------------------------------------------
Undivided interest of 0.39% in joint repurchase
agreement (Principal Amount/Value
$1,443,703,000, with a maturity value of
$1,443,962,867) with UBS Warburg LLC,
2.16%, dated 12/31/04, to be repurchased
at $5,672,021 on 1/3/05, collateralized by
Federal National Mortgage Assn., 5%--6%,
4/1/34--10/1/34, with a value of
$1,474,609,071 (Cost $5,671,000)                       5,671,000       5,671,000
- ---------------------------------------------------------------------------------
Total Investments, at Value (excluding
Investments Purchased with Cash Collateral
from Securities Loaned) (Cost $179,532,171)                          214,724,670

- ---------------------------------------------------------------------------------
INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM
SECURITIES LOANED--20.3%
- ---------------------------------------------------------------------------------
ASSET-BACKED FLOATING NOTES--0.7%
Whitehawk CDO Funding Corp., 2.56%, 3/15/05 4          1,500,000       1,500,000
- ---------------------------------------------------------------------------------
MASTER FLOATING NOTES--0.8%
Bear Stearns, 2.493%, 1/3/05 4                           250,000         250,000
- ---------------------------------------------------------------------------------
Merrill Lynch Mortgage Capital, 2.413%, 1/3/05 4       1,500,000       1,500,000
                                                                   --------------
                                                                       1,750,000




                                                       PRINCIPAL           VALUE
                                                          AMOUNT      SEE NOTE 1
- ---------------------------------------------------------------------------------

MEDIUM-TERM FLOATING NOTES--0.3%
Sigma Finance, Inc., 2.502% Medium
Term Nts., 1/25/054                                 $    654,709   $     654,709
- ---------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--18.5%
Undivided interest of 1.40% in joint
repurchase agreement (Principal Amount/Value
$2,800,000,000, with a maturity value of
$2,800,550,669) with Nomura Securities,
2.36%, dated 12/31/04, to be repurchased at
$39,316,193 on 1/3/05, collateralized by U.S.
Government Mortgage Agencies, 2.58%-7.50%,
1/15/08-10/15/44, with a value of
$2,908,566,289 4                                      39,308,462      39,308,462
                                                                   --------------

Total Investments Purchased with Cash Collateral
from Securities Loaned (Cost $43,213,171)                             43,213,171

- ---------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $222,745,342)                                        121.5%  $ 257,937,841
- ---------------------------------------------------------------------------------
LIABILITIES IN EXCESS
OF OTHER ASSETS                                            (21.5)    (45,690,682)
                                                   ------------------------------
NET ASSETS                                                 100.0%  $ 212,247,159
                                                   ==============================


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. 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 $55,314 or 0.03% of the Fund's net assets
as of December 31, 2004.

3. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of December 31, 2004 was $108,569, which represents
0.05% of the Fund's net assets, all of which is considered restricted. See Note
6 of Notes to Financial Statements.

4. The security has been segregated to satisfy the forward commitment to return
the cash collateral received in securities lending transactions upon the
borrower's return of the securities loaned. See Note 7 of Notes to Financial
Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                 26 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- ------------------------------------------------------------------------------------------------------------------------------
ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Investments, at value (including securities loaned of $42,237,021) (cost $222,745,342)
- --see accompanying statement of investments                                                                     $ 257,937,841
- ------------------------------------------------------------------------------------------------------------------------------
Cash                                                                                                                  541,763
- ------------------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold                                                                                                    4,003,790
Shares of beneficial interest sold                                                                                    378,981
Interest and dividends                                                                                                100,357
Other                                                                                                                   3,053
                                                                                                                --------------
Total assets                                                                                                      262,965,785

- ------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ------------------------------------------------------------------------------------------------------------------------------
Return of collateral for securities loaned                                                                         43,213,171
- ------------------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased                                                                                               6,775,389
Shares of beneficial interest redeemed                                                                                579,239
Distribution and service plan fees                                                                                     95,006
Shareholder communications                                                                                             18,272
Trustees' compensation                                                                                                  4,860
Transfer and shareholder servicing agent fees                                                                           1,723
Other                                                                                                                  30,966
                                                                                                                --------------
Total liabilities                                                                                                  50,718,626

- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                                      $ 212,247,159
                                                                                                                ==============

- ------------------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                                                      $      13,275
- ------------------------------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                                        171,354,624
- ------------------------------------------------------------------------------------------------------------------------------
Accumulated net investment loss                                                                                       (52,556)
- ------------------------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign currency transactions                                      5,739,256
- ------------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign
currencies                                                                                                         35,192,560
                                                                                                                --------------
NET ASSETS                                                                                                      $ 212,247,159
                                                                                                                ==============

- ------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ------------------------------------------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $38,635,539
and 2,406,937 shares of beneficial interest outstanding)                                                        $       16.05
- ------------------------------------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $173,611,620
and 10,868,312 shares of beneficial interest outstanding)                                                       $       15.97


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS


                 27 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------



- ----------------------------------------------------------------------------------------
INVESTMENT INCOME
- ----------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $2,509)                    $   1,144,958
- ----------------------------------------------------------------------------------------
Portfolio lending fees                                                          100,675
- ----------------------------------------------------------------------------------------
Interest                                                                         64,642
                                                                          --------------
Total investment income                                                       1,310,275

- ----------------------------------------------------------------------------------------
EXPENSES
- ----------------------------------------------------------------------------------------
Management fees                                                               1,070,988
- ----------------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                              279,935
- ----------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                               10,029
Service shares                                                                   10,136
- ----------------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                                4,565
Service shares                                                                   19,063
- ----------------------------------------------------------------------------------------
Trustees' compensation                                                            7,102
- ----------------------------------------------------------------------------------------
Custodian fees and expenses                                                       2,542
- ----------------------------------------------------------------------------------------
Other                                                                            41,355
                                                                          --------------
Total expenses                                                                1,445,715
Less reduction to custodian expenses                                               (805)
                                                                          --------------
Net expenses                                                                  1,444,910

- ----------------------------------------------------------------------------------------
NET INVESTMENT LOSS                                                            (134,635)

- ----------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN
- ----------------------------------------------------------------------------------------
Net realized gain on:
Investments                                                                   9,552,785
Foreign currency transactions                                                    26,819
                                                                          --------------
Net realized gain                                                             9,579,604
- ----------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                                  19,928,773
Translation of assets and liabilities denominated in foreign currencies         175,318
                                                                          --------------
Net change in unrealized appreciation                                        20,104,091

- ----------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                      $  29,549,060
                                                                          ==============


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                 28 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                               2004            2003
- ------------------------------------------------------------------------------------------------------------------------------

OPERATIONS
- ------------------------------------------------------------------------------------------------------------------------------
Net investment loss                                                                              $    (134,635)  $   (168,501)
- ------------------------------------------------------------------------------------------------------------------------------
Net realized gain                                                                                    9,579,604      2,703,929
- ------------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation                                                               20,104,091     15,038,979
                                                                                                 -----------------------------
Net increase in net assets resulting from operations                                                29,549,060     17,574,407

- ------------------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial interest transactions:
Non-Service shares                                                                                   5,097,638        536,751
Service shares                                                                                      87,389,394     46,411,899

- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Total increase                                                                                     122,036,092     64,523,057
- ------------------------------------------------------------------------------------------------------------------------------
Beginning of period                                                                                 90,211,067     25,688,010
                                                                                                 -----------------------------
End of period (including accumulated net investment loss of $52,556 and $32,616, respectively)   $ 212,247,159   $ 90,211,067
                                                                                                 =============================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                 29 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,           2004       2003       2002       2001       2000
- ----------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                $  13.44   $   9.31   $  11.05   $  11.09   $  14.07
- ----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                             .01 1     (.03)      (.01)        -- 2     (.03)
Net realized and unrealized gain (loss)                 2.60       4.16      (1.73)      (.04)     (2.35)
                                                    ------------------------------------------------------
Total from investment operations                        2.61       4.13      (1.74)      (.04)     (2.38)
- ----------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                      --         --         --         --       (.60)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period                      $  16.05   $  13.44   $   9.31   $  11.05   $  11.09
                                                    ======================================================

- ----------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                     19.42%     44.36%    (15.75)%    (0.36)%   (18.34)%
- ----------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)            $ 38,636   $ 27,551   $ 19,577   $ 18,514   $ 14,599
- ----------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                   $ 30,871   $ 20,271   $ 20,505   $ 15,307   $ 12,576
- ----------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss)                            0.06%     (0.30)%    (0.09)%    (0.01)%    (0.29)%
Total expenses                                          0.83%      1.01%      1.00%      1.05%      1.37%
Expenses after payments and waivers and reduction
to custodian expenses                                    N/A 5      N/A 5      N/A 5      N/A 5     1.35%
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                  147%       130%       121%       213%       162%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Less than $0.005 per share.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                 30 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA




SERVICE SHARES  YEAR ENDED DECEMBER 31,                                        2004         2003         2002     2001 1
- --------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $   13.40     $   9.29     $  11.05    $ 10.61
- --------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                                   (.02) 2      (.02)        (.01)        -- 3
Net realized and unrealized gain (loss)                                        2.59         4.13        (1.75)       .44
                                                                          ------------------------------------------------
Total from investment operations                                               2.57         4.11        (1.76)       .44
- --------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                                             --           --           --         --
- --------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                                            $   15.97     $  13.40     $   9.29    $ 11.05
                                                                          ================================================

- --------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 4                                            19.18%       44.24%      (15.93)%     4.15%
- --------------------------------------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $ 173,612     $ 62,660     $  6,111    $   108
- --------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $ 112,279     $ 25,018     $  2,228    $    26
- --------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment loss                                                           (0.14)%      (0.43)%      (0.26)%    (0.34)%
Total expenses                                                                 1.06%        1.23%        1.21%      1.19%
Expenses after payments and waivers and reduction to custodian expenses         N/A 6        N/A 6       1.19%       N/A 6
- --------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                         147%         130%         121%       213%


1. For the period from July 16, 2001 (inception of offering) to December 31,
2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Less than $0.005 per share.

4. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                 31 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Main Street Small Cap Fund/VA (the Fund) is a separate series of
Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek capital appreciation. The
Trust's investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.


                 32 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                               NET UNREALIZED
                                                                 APPRECIATION
                                                             BASED ON COST OF
                                                               SECURITIES AND
   UNDISTRIBUTED    UNDISTRIBUTED    ACCUMULATED            OTHER INVESTMENTS
   NET INVESTMENT       LONG-TERM           LOSS           FOR FEDERAL INCOME
   INCOME                    GAIN   CARRYFORWARD 1,2,3,4         TAX PURPOSES
   --------------------------------------------------------------------------
   $ --               $ 5,832,268       $ 15,991                 $ 35,066,036

1. The Fund had $1,241 of post-October foreign currency losses which were
deferred.

2. The Fund had $14,750 of post-October passive foreign investment company
losses which were deferred.

3. During the fiscal year ended December 31, 2004, the Fund utilized $3,233,886
of capital loss carryforward to offset capital gains realized in that fiscal
year.

4. During the fiscal year ended December 31, 2003, the Fund utilized $2,435,654
of capital loss carryforward to offset capital gains realized in that fiscal
year.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

                              REDUCTION TO      REDUCTION TO
                               ACCUMULATED   ACCUMULATED NET
          INCREASE TO       NET INVESTMENT     REALIZED GAIN
          PAID-IN CAPITAL             LOSS    ON INVESTMENTS 5
          ----------------------------------------------------
          $ 491,766              $ 114,695         $ 606,461

5. $599,308, all of which was long-term capital gain, was distributed in
connection with Fund share redemptions.

No distributions were paid during the years ended December 31, 2004 and December
31, 2003.


                 33 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1.SIGNIFICANT ACCOUNTING POLICIES Continued

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

              Federal tax cost of securities   $ 222,871,866
                                               ==============

              Gross unrealized appreciation    $  36,927,077
              Gross unrealized depreciation       (1,861,041)
                                               --------------
              Net unrealized appreciation      $  35,066,036
                                               ==============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity
with U.S. 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.


                 34 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                           YEAR ENDED AUGUST 31, 2004    YEAR ENDED AUGUST 31, 2003
                               SHARES          AMOUNT        SHARES          AMOUNT
- --------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                          989,664   $  13,869,116       826,676   $   9,370,135
Redeemed                     (632,898)     (8,771,478)     (879,995)     (8,833,384)
                          ---------------------------------------------------------
Net increase (decrease)       356,766   $   5,097,638       (53,319)  $     536,751
                          =========================================================

- -----------------------------------------------------------------------------------
SERVICE SHARES
Sold                        7,817,367   $ 110,026,860     4,910,616   $  56,495,920
Redeemed                   (1,624,349)    (22,637,466)     (892,849)    (10,084,021)
                          ---------------------------------------------------------
Net increase                6,193,018   $  87,389,394     4,017,767   $  46,411,899
                          =========================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$297,239,226 and $206,565,862, respectively.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$20,106 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees for all classes to 0.35% of average annual
net assets per class. This undertaking may be amended or withdrawn at any time.


                 35 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

      As of December 31, 2004, the Fund had no outstanding foreign currency
contracts.

- --------------------------------------------------------------------------------
6. ILLIQUID OR RESTRICTED SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 15% of
its net assets (determined at the time of purchase and reviewed periodically) in
illiquid or restricted securities. Certain restricted securities, eligible for
resale to qualified institutional investors, are not subject to that limitation.
Information concerning restricted securities is as follows:



                                                                         UNREALIZED
                         ACQUISITION                VALUATION AS OF    APPRECIATION
SECURITY                       DATES       COST   DECEMBER 31, 2004   (DEPRECIATION)
- ------------------------------------------------------------------------------------

Lightning Energy Ltd.        11/8/04   $ 53,664            $ 49,293        $ (4,371)
ProspEx Resources Ltd.      11/17/04      9,233               9,605             372
Tusk Energy Corp.           11/15/04     38,148              49,671          11,523


- --------------------------------------------------------------------------------
7. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had on loan securities valued at $42,237,021. Cash of $43,213,171 was
received as collateral for the loans, all of which was invested in approved
instruments.


                 36 | OPPENHEIMER MAIN STREET SMALL CAP FUND/VA


- --------------------------------------------------------------------------------
8. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.

EX-99

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER MONEY FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Money Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Money Fund/VA as of December 31, 2004, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the five
years in the period then ended, in conformity with accounting principles
generally accepted in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005



STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------


                                                     PRINCIPAL           VALUE
                                                        AMOUNT      SEE NOTE 1
- -------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT--13.7%
- -------------------------------------------------------------------------------
DOMESTIC CERTIFICATES OF DEPOSIT--2.0%
Citibank NA, 2.31%, 2/23/05                        $ 2,000,000   $   2,000,000
- -------------------------------------------------------------------------------
Washington Mutual Bank FA,
2.29%, 2/11/05                                       2,000,000       2,000,000
                                                                 --------------
                                                                       4,000,000

- -------------------------------------------------------------------------------
YANKEE CERTIFICATES OF DEPOSIT--11.7%
Bank of Montreal Chicago, 2.28%,
1/13/05                                              2,000,000       2,000,000
- -------------------------------------------------------------------------------
BNP Paribas, New York, 2.33%,
6/22/05 1                                            5,000,000       4,998,933
- -------------------------------------------------------------------------------
Fortis Bank SA/NV, New York,
2.10%, 1/5/05                                        2,500,000       2,500,000
- -------------------------------------------------------------------------------
Nordea Bank Finland plc, New York
Branch, 2.34%, 6/29/05 1                             3,000,000       2,999,482
- -------------------------------------------------------------------------------
Societe Generale, New York, 2.33%,
6/14/05 1                                            5,000,000       4,999,321
- -------------------------------------------------------------------------------
Svenska Handelsbanken NY, 2.47%,
3/24/05                                              3,500,000       3,500,000
- -------------------------------------------------------------------------------
Toronto Dominion Bank, New York,
2.34%, 2/10/05                                       2,000,000       2,000,000
                                                                 --------------
Total Certificates of Deposit (Cost $26,997,736)                    26,997,736

- -------------------------------------------------------------------------------
DIRECT BANK OBLIGATIONS--8.6%
- -------------------------------------------------------------------------------
AB SPINTAB, 2.39%, 2/23/05                           3,000,000       2,989,466
- -------------------------------------------------------------------------------
Barclays US Funding Corp.,
2.18%, 1/12/05                                       2,500,000       2,498,335
- -------------------------------------------------------------------------------
Calyon North America, Inc.,
2.25%, 1/4/05                                        2,000,000       1,999,625
- -------------------------------------------------------------------------------
DnB NOR Bank ASA, 2.27%, 2/1/05                      1,200,000       1,197,654
- -------------------------------------------------------------------------------
Governor & Co. of the Bank of
Ireland, 2.08%, 3/29/05 2                            2,000,000       1,989,947
- -------------------------------------------------------------------------------
HBOS Treasury Services, 2.33%,
2/28/05                                              1,250,000       1,245,308
- -------------------------------------------------------------------------------
Skandinaviska Enskilda Banken AB,
2.45%, 3/23/05 2                                     2,000,000       1,988,975
- -------------------------------------------------------------------------------
Standard Federal Bank, 2.17%, 1/7/05                 1,000,000       1,000,000
- -------------------------------------------------------------------------------
Swedbank AB, 2.31%, 2/9/05                           2,000,000       1,994,995
                                                                 --------------
Total Direct Bank Obligations
(Cost $16,904,305)                                                  16,904,305

- -------------------------------------------------------------------------------
LETTERS OF CREDIT--2.6%
- -------------------------------------------------------------------------------
Chase Manhattan Bank, guaranteeing
commercial paper of NATC
California LLC, 2.03%, 1/19/05
(Cost $4,994,925)                                    5,000,000       4,994,925

                                                     PRINCIPAL           VALUE
                                                        AMOUNT      SEE NOTE 1
- -------------------------------------------------------------------------------
SHORT-TERM NOTES--71.5%
- -------------------------------------------------------------------------------
ASSET-BACKED--25.0%
Cable Beach LP, 2.03%, 1/6/05 2                    $ 3,000,000   $   2,999,154
- -------------------------------------------------------------------------------
Chesham Finance LLC, 2.38%, 2/28/05 2                1,000,000         996,166
- -------------------------------------------------------------------------------
Crown Point Capital Co.:
1.85%, 1/21/05 2                                     4,100,000       4,095,786
2.11%, 3/21/05 2                                     2,325,000       2,314,235
- -------------------------------------------------------------------------------
Eiffel Funding LLC, 2.36%, 2/10/05 2                 2,040,000       2,034,651
- -------------------------------------------------------------------------------
FCAR Owner Trust I, 2.20%, 1/7/05                    1,000,000         999,633
- -------------------------------------------------------------------------------
Gotham Funding Corp., 2.31%,
1/10/05 2                                            1,500,000       1,499,134
- -------------------------------------------------------------------------------
GOVCO, Inc., 2.05%, 1/18/05 2                        4,000,000       3,996,128
- -------------------------------------------------------------------------------
Grampian Funding LLC, 2.32%,
2/1/05 2                                             1,300,000       1,297,403
- -------------------------------------------------------------------------------
Legacy Capital LLC, 2.02%, 3/4/05 2                  2,500,000       2,491,260
- -------------------------------------------------------------------------------
Lexington Parker Capital Co. LLC:
2.03%, 1/10/05 2                                     2,000,000       1,998,995
2.15%, 4/5/05 2                                      3,000,000       2,983,158
- -------------------------------------------------------------------------------
Neptune Funding Corp., 2.53%,
3/7/05 2                                             3,500,000       3,487,108
- -------------------------------------------------------------------------------
New Center Asset Trust, 2.21%,
1/14/05                                              2,500,000       2,498,005
- -------------------------------------------------------------------------------
Perry Global Funding LLC,
Series A, 2.06%, 1/24/05 2                           5,266,000       5,259,069
- -------------------------------------------------------------------------------
Regency Markets No. 1 LLC, 2.37%,
1/7/05 2                                             2,000,000       1,999,230
- -------------------------------------------------------------------------------
Sheffield Receivables Corp., 2.17%,
1/3/05 2                                             1,100,000       1,099,867
- -------------------------------------------------------------------------------
Thornburg Mortgage Capital
Resources, 2.11%, 1/31/05 2                          5,000,000       4,992,166
- -------------------------------------------------------------------------------
Victory Receivables Corp., 2.22%,
1/14/05 2                                            1,000,000         999,198
- -------------------------------------------------------------------------------
Windmill Funding Corp., 2.25%,
1/19/05 2                                            1,000,000         998,875
                                                                 --------------
                                                                      49,039,221

- -------------------------------------------------------------------------------
AUTOMOBILES--3.3%
Ande Chevrolet Olds, Inc.,
2.57%, 1/1/05 1                                      2,000,000       2,000,000
- -------------------------------------------------------------------------------
BMW US Capital LLC:
2.20%, 1/3/05 2                                      2,500,000       2,499,694
2.30%, 1/14/05 2                                     2,000,000       1,998,339
                                                                 --------------
                                                                       6,498,033

- -------------------------------------------------------------------------------
CAPITAL MARKETS--13.3%
Banc of America Securities LLC,
2.32%, 1/3/05 1                                      5,000,000       5,000,000
- -------------------------------------------------------------------------------
Bear Stearns Cos., Inc., 2.01%, 1/13/05              3,220,000       3,217,843
- -------------------------------------------------------------------------------
First Clearing LLC, 2.41%, 6/6/05 1                  8,000,000       8,000,000
- -------------------------------------------------------------------------------
Lehman Brothers, Inc., 2.38%,
12/15/05 1                                           5,000,000       5,000,000



                          6 | OPPENHEIMER MONEY FUND/VA


                                                     PRINCIPAL           VALUE
                                                        AMOUNT      SEE NOTE 1
- -------------------------------------------------------------------------------
CAPITAL MARKETS--13.3%
Morgan Stanley, 2.34%, 1/21/05                     $ 5,000,000   $   4,993,500
                                                                 --------------
                                                                      26,211,343

- -------------------------------------------------------------------------------
COMMERCIAL BANKS--0.8%
Bank of America Corp., 2.19%,
1/13/05                                              1,500,000       1,498,905
- -------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--5.8%
General Electric Capital Corp.,
2.32%, 2/25/05                                       3,000,000       2,989,367
- -------------------------------------------------------------------------------
General Electric Capital Services,
2.46%, 3/21/05                                       3,500,000       3,481,106
- -------------------------------------------------------------------------------
Household Finance Corp., 2%,
1/13/05                                              5,000,000       4,996,667
                                                                 --------------
                                                                      11,467,140

- -------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--1.2%
Alta Mira LLC, Series 2004, 2.57%,
1/3/05 1                                             2,250,000       2,250,000
- -------------------------------------------------------------------------------
INSURANCE--7.9%
Jackson National Life Global Funding,
Series 2004-6, 2.40%, 1/17/05 1,3                    2,500,000       2,500,000
- -------------------------------------------------------------------------------
Metropolitan Life Global Funding I,
Series 2003-5, 2.44%, 1/17/05 1,4                    4,000,000       4,000,000
- -------------------------------------------------------------------------------
Security Life of Denver Insurance
Co., 2.54%, 1/24/05 1,4                              5,000,000       5,000,000
- -------------------------------------------------------------------------------
United of Omaha Life Insurance
Co., 2.38%, 11/17/05 1,4                             4,000,000       4,000,000
                                                                 --------------
                                                                      15,500,000

- -------------------------------------------------------------------------------
LEASING & FACTORING--2.0%
American Honda Finance Corp.,
2.79%, 3/11/05 1,3                                   1,000,000       1,000,523
- -------------------------------------------------------------------------------
Toyota Motor Credit Corp.,
2.17%, 1/12/05                                       3,000,000       2,998,011
                                                                 --------------
                                                                       3,998,534

- -------------------------------------------------------------------------------
OIL & GAS--1.0%
Koch Industries LLC, 2.29%, 1/11/05 2                2,000,000       1,998,728
- -------------------------------------------------------------------------------
SPECIAL PURPOSE FINANCIAL--11.2%
Cooperative Assn. of Tractor
Dealers, Inc., Series A:
2.35%, 1/4/05                                        2,571,000       2,570,497
2.36%, 2/18/05                                       1,300,000       1,295,909
- -------------------------------------------------------------------------------
Cooperative Assn. of Tractor
Dealers, Inc., Series B:
2.36%, 2/15/05                                       1,000,000         997,050
2.40%, 1/5/05                                        2,500,000       2,499,333
2.48%, 3/15/05                                       1,500,000       1,492,457
- -------------------------------------------------------------------------------
K2 (USA) LLC:
2.12%, 1/25/05 2                                     1,250,000       1,248,233
2.38%, 6/30/05 1,3                                   3,000,000       2,999,699
- -------------------------------------------------------------------------------
LINKS Finance LLC, 2.35%, 12/15/05 1,3               3,000,000       2,999,142

                                                     PRINCIPAL           VALUE
                                                        AMOUNT      SEE NOTE 1
- -------------------------------------------------------------------------------
SPECIAL PURPOSE FINANCIAL Continued
Parkland (USA) LLC, 2.38%, 1/14/05 1,3             $ 2,000,000   $   1,999,993
- -------------------------------------------------------------------------------
RACERS Trust, Series 2004-6-MM,
2.41%, 1/24/05 1,3                                   1,000,000       1,000,000
- -------------------------------------------------------------------------------
Sigma Finance, Inc., 2.35%, 12/15/05 1,3             2,900,000       2,899,200
                                                                 --------------
                                                                      22,001,513
                                                                 --------------
Total Short-Term Notes
(Cost $140,463,417)                                                140,463,417

- -------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCIES--3.3%
- -------------------------------------------------------------------------------
Federal Home Loan Bank,
1.50%, 3/1/05                                        2,000,000       2,000,000
- -------------------------------------------------------------------------------
Federal National Mortgage Assn.:
1.375%, 2/18/05                                      2,000,000       2,000,000
1.60%, 5/13/05                                       2,500,000       2,500,000
                                                                 --------------
Total U.S. Government Agencies
(Cost $6,500,000)                                                    6,500,000

- -------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $195,860,383)                                       99.7%    195,860,383
- -------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES                            0.3         642,440
                                                   ----------------------------
NET ASSETS                                               100.0%  $ 196,502,823
                                                   ============================


FOOTNOTES TO STATEMENT OF INVESTMENTS

SHORT-TERM NOTES, DIRECT BANK OBLIGATIONS AND LETTERS OF CREDIT ARE GENERALLY
TRADED ON A DISCOUNT BASIS; THE INTEREST RATE SHOWN IS THE DISCOUNT RATE
RECEIVED BY THE FUND AT THE TIME OF PURCHASE. OTHER SECURITIES NORMALLY BEAR
INTEREST AT THE RATES SHOWN.

1. Represents the current interest rate for a variable or increasing rate
security.

2. Security issued in an exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $57,265,499, or 29.14% of the
Fund's net assets, and have been determined to be liquid pursuant to guidelines
adopted by the Board of Trustees.

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 $15,398,557 or 7.84% of the Fund's net
assets as of December 31, 2004.

4. Illiquid security. The aggregate value of illiquid securities as of December
31, 2004 was $13,000,000, which represents 6.62% of the Fund's net assets. See
Note 4 of Notes to Financial Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          7 | OPPENHEIMER MONEY FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- -----------------------------------------------------------------------------------------------------
ASSETS
- -----------------------------------------------------------------------------------------------------
Investments, at value (cost $195,860,383)--see accompanying statement of investments   $ 195,860,383
- -----------------------------------------------------------------------------------------------------
Cash                                                                                         151,267
- -----------------------------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold                                                           674,010
Interest                                                                                     140,157
Other                                                                                          3,085
                                                                                       --------------
Total assets                                                                             196,828,902

- -----------------------------------------------------------------------------------------------------
LIABILITIES
- -----------------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                                       176,208
Dividends                                                                                    112,938
Shareholder communications                                                                    17,299
Trustees' compensation                                                                         4,432
Transfer and shareholder servicing agent fees                                                    844
Other                                                                                         14,358
                                                                                       --------------
Total liabilities                                                                            326,079

- -----------------------------------------------------------------------------------------------------
NET ASSETS                                                                             $ 196,502,823
                                                                                       ==============

- -----------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- -----------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                             $     196,475
- -----------------------------------------------------------------------------------------------------
Additional paid-in capital                                                               196,306,550
- -----------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments                                                    (202)
                                                                                       --------------
NET ASSETS--applicable to 196,475,255 shares of beneficial interest outstanding        $ 196,502,823
                                                                                       ==============

- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, REDEMPTION PRICE PER SHARE AND OFFERING PRICE PER SHARE               $        1.00


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          8 | OPPENHEIMER MONEY FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- -------------------------------------------------------------------
INVESTMENT INCOME
- -------------------------------------------------------------------
Interest                                               $ 3,151,606

- -------------------------------------------------------------------
EXPENSES
- -------------------------------------------------------------------
Management fees                                            982,603
- -------------------------------------------------------------------
Shareholder communications                                  19,605
- -------------------------------------------------------------------
Transfer and shareholder servicing agent fees               10,029
- -------------------------------------------------------------------
Trustees' compensation                                       5,499
- -------------------------------------------------------------------
Custodian fees and expenses                                  3,733
- -------------------------------------------------------------------
Other                                                       20,310
                                                       ------------
Total expenses                                           1,041,779
Less reduction to custodian expenses                        (1,310)
                                                       ------------
Net expenses                                             1,040,469

- -------------------------------------------------------------------
NET INVESTMENT INCOME                                    2,111,137

- -------------------------------------------------------------------
NET REALIZED GAIN ON INVESTMENTS                               481

- -------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS   $ 2,111,618
                                                       ============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                          9 | OPPENHEIMER MONEY FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                               2004             2003
- ------------------------------------------------------------------------------------------------------------

OPERATIONS
- ------------------------------------------------------------------------------------------------------------
Net investment income                                                        $   2,111,137    $   2,534,902
- ------------------------------------------------------------------------------------------------------------
Net realized gain (loss)                                                               481             (683)
                                                                             -------------------------------
Net increase in net assets resulting from operations                             2,111,618        2,534,219

- ------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ------------------------------------------------------------------------------------------------------------
Dividends from net investment income                                            (2,111,137)      (2,534,902)

- ------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ------------------------------------------------------------------------------------------------------------
Net decrease in net assets resulting from beneficial interest transactions     (41,110,557)    (142,355,858)
- ------------------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------------------
Total decrease                                                                 (41,110,076)    (142,356,541)
- ------------------------------------------------------------------------------------------------------------
Beginning of period                                                            237,612,899      379,969,440
                                                                             -------------------------------
End of period                                                                $ 196,502,823    $ 237,612,899
                                                                             ===============================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                         10 | OPPENHEIMER MONEY FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                     2004          2003          2002          2001          2000
- ---------------------------------------------------------------------------------------------------------------------------

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                      .01 1         .01           .01           .04           .06
- ---------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                        (.01)         (.01)         (.01)         (.04)         (.06)
Dividends from net realized gain                              --            --            -- 2          --            --
                                                       --------------------------------------------------------------------
Total dividends and/or distributions to shareholders        (.01)         (.01)         (.01)         (.04)         (.06)
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                         $    1.00     $    1.00     $    1.00     $    1.00     $    1.00
                                                       ====================================================================

- ---------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN 3                                              0.98%         0.79%         1.47%         3.85%         6.26%
- ---------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)               $ 196,503     $ 237,613     $ 379,969     $ 370,229     $ 215,771
- ---------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $ 218,243     $ 316,096     $ 386,457     $ 288,106     $ 204,586
- ---------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                       0.97%         0.80%         1.46%         3.59%         5.98%
Total expenses                                              0.48% 5       0.47% 5       0.47% 5       0.52% 5       0.51% 5


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Less than $0.005 per share.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                         11 | OPPENHEIMER MONEY FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Money Fund/VA (the Fund) is a separate series of Oppenheimer
Variable Account Funds (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek maximum current income from investments in
"money market" securities consistent with low capital risk and the maintenance
of liquidity. The Trust's investment advisor is OppenheimerFunds, Inc. (the
Manager).

      Shares of the Fund are only sold to separate investment accounts of
participating insurance companies as an underlying investment for variable life
insurance policies, variable annuity contracts or other investment products.

     The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. Portfolio securities are valued on the basis of amortized
cost, which approximates market value.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years for
federal income tax purposes.

        UNDISTRIBUTED NET     UNDISTRIBUTED       ACCUMULATED CAPITAL
        INVESTMENT INCOME   LONG-TERM GAINS   LOSS CARRYFORWARD 1,2,3
        -------------------------------------------------------------
        $ 163,152                      $ --                     $ 202

1. As of December 31, 2004, the Fund had $202 of net capital loss carryforward
available to offset future realized capital gains, if any, and thereby reduce
future taxable gain distributions. As of December 31, 2004, details of the
capital loss carryforward were as follows:

               EXPIRING
               ----------------------
               2011             $ 202

2. During the fiscal year December 31, 2004, the Fund utilized $481 of capital
loss carryforward to offset capital gains realized in that fiscal year.

3. During the fiscal year December 31, 2003, the Fund did not utilize any
capital loss carryforwards.

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                        YEAR ENDED          YEAR ENDED
                                 DECEMBER 31, 2004   DECEMBER 31, 2003
      ----------------------------------------------------------------
      Distributions paid from:
      Ordinary income                  $ 2,111,137         $ 2,534,902

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income distributions, if any, are declared
daily and paid monthly. Capital gain distributions, if any, are declared and
paid annually but may be paid at other times to maintain the net asset value per
share at $1.00.


                         12 | OPPENHEIMER MONEY FUND/VA


- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:



                                             YEAR ENDED DECEMBER 31, 2004    YEAR ENDED DECEMBER 31, 2003
                                                  SHARES           AMOUNT         SHARES           AMOUNT
- ----------------------------------------------------------------------------------------------------------

Sold                                         135,559,970   $  135,559,970    339,107,835   $  339,107,835
Dividends and/or distributions reinvested      2,042,069        2,042,069      2,603,068        2,603,068
Redeemed                                    (178,712,596)    (178,712,596)  (484,066,761)    (484,066,761)
                                            --------------------------------------------------------------
Net decrease                                 (41,110,557)  $  (41,110,557)  (142,355,858)  $ (142,355,858)
                                            ==============================================================


- --------------------------------------------------------------------------------
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.45% of the first $500 million of average annual net assets,
0.425% of the next $500 million, 0.40% of the next $500 million and 0.375% of
average annual net assets in excess of $1.5 billion.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$10,018 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 for assets of $10 million or more. The Fund
is subject to the minimum fee in the event that the per account fee does not
equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees to 0.35% of average annual net assets of
the Fund. This undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
4. ILLIQUID SECURITIES

As of December 31, 2004, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 10% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities.


                         13 | OPPENHEIMER MONEY FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER STRATEGIC BOND FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Strategic Bond Fund/VA, a series of Oppenheimer Variable Account
Funds, including the statement of investments, as of December 31, 2004, and the
related statement of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then ended, and
the financial highlights for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Strategic Bond Fund/VA as of December 31, 2004, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for the
periods presented, in conformity with accounting principles generally accepted
in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005

STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--2.4%
- --------------------------------------------------------------------------------
Arbor I Ltd., Catastrophe
Linked Nts.,
Series 2004-4, 16.49%, 3/15/06 1                 $     250,000   $       253,774
- --------------------------------------------------------------------------------
Bank One Auto Securitization
Trust, Automobile Receivable
Certificates,
Series 2003-1, Cl. A2,
1.29%, 8/21/06                                         212,619           212,242
- --------------------------------------------------------------------------------
BMW Vehicle Owner Trust,
Automobile Loan Certificates,
Series 2004-A, Cl. A2,
1.88%, 10/25/06                                        716,519           714,221
- --------------------------------------------------------------------------------
Capital Auto Receivables Asset
Trust, Automobile Mtg.-Backed
Nts., Series 2004-2, Cl. A3, 3.58%,
1/15/09                                                740,000           739,075
- --------------------------------------------------------------------------------
Centex Home Equity Co. LLC,
Home Equity Loan Asset-Backed
Certificates:
Series 2003-C, Cl. AF1,
2.14%, 7/25/18                                          71,469            71,389
Series 2004-A, Cl. AF1,
2.03%, 6/25/19                                         136,318           135,794
Series 2004-D, Cl. AF1,
2.98%, 4/25/20 2                                       338,237           337,140
- --------------------------------------------------------------------------------
Chase Funding Mortgage Loan
Asset-Backed Certificates,
Home Equity Mtg. Obligations:
Series 2002-4, Cl. 1A3,
3.44%, 4/25/23                                         109,997           110,004
Series 2003-1, Cl. 1A3,
3.14%, 7/25/23                                         302,706           302,548
Series 2003-4, Cl. 1A1,
2.538%, 9/25/17 1                                       53,909            53,938
Series 2003-4, Cl. 1A2,
2.138%, 7/25/18                                        280,000           279,060
Series 2004-1, Cl. 2A1,
2.528%, 9/25/21 1                                      486,551           486,864
- --------------------------------------------------------------------------------
Chase Manhattan Auto Owner
Trust, Automobile Loan
Pass-Through Certificates:
Series 2002-A, Cl. A4,
4.24%, 9/15/08                                         152,203           153,155
Series 2003-B, Cl. A2,
1.28%, 3/15/06                                          58,362            58,330
- --------------------------------------------------------------------------------
CIT Equipment Collateral,
Equipment Receivable-Backed
Nts., Series 2004-DFS, Cl. A2,
2.66%, 11/20/06 2                                      550,000           547,659
- --------------------------------------------------------------------------------
CIT Group Home Equity Loan
Trust, Home Equity Loan
Asset-Backed Certificates,
Series 2003-1, Cl. A2, 2.35%,
4/20/27                                                292,505           291,952


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- --------------------------------------------------------------------------------
Citibank Credit Card Issuance
Trust, Credit Card Receivable Nts.,
Series 2002-A3, Cl. A3,
4.40%, 5/15/07                                   $     530,000   $       533,661
- --------------------------------------------------------------------------------
CitiFinancial Mortgage Securities,
Inc., Home Equity Collateralized
Mtg. Obligations:
Series 2003-2, Cl. AF1,
2.518%, 5/25/33 1                                       32,335            32,356
Series 2003-3, Cl. AF1,
2.538%, 8/25/33 1                                      144,250           144,346
- --------------------------------------------------------------------------------
Consumer Credit Reference Index
Securities Program, Credit Card
Asset-Backed Certificates,
Series 2002-B, Cl. FX,
10.421%, 3/22/07 2                                     500,000           514,941
- --------------------------------------------------------------------------------
DaimlerChrysler Auto Trust,
Automobile Loan
Pass-Through Certificates:
Series 2003-A, Cl. A2, 1.52%, 12/8/05                  177,134           177,116
Series 2003-B, Cl. A2, 1.61%, 7/10/06                  561,254           560,311
Series 2004-B, Cl. A2, 2.48%, 2/8/07 2                 600,000           598,561
Series 2004-C, Cl. A2, 2.62%, 6/8/07                 1,040,000         1,036,808
- --------------------------------------------------------------------------------
Embarcadero Aircraft
Securitization Trust, Airplane
Receivable Nts., Series 2000-A,
Cl. B, 0.678%, 8/15/25 2,3,4                         1,820,063               569
- --------------------------------------------------------------------------------
Ford Credit Auto Owner Trust,
Automobile Loan Pass-Through
Certificates, Series 2004-A,
Cl. A2, 2.13%, 10/15/06                              1,120,000         1,115,639
- --------------------------------------------------------------------------------
Harley-Davidson Motorcycle
Trust, Motorcycle Receivable Nts.,
Series 2003-3, Cl. A1, 1.50%, 1/15/08                  389,176           387,801
- --------------------------------------------------------------------------------
Honda Auto Receivables
Owner Trust, Automobile
Receivable Obligations:
Series 2003-3, Cl. A2, 1.52%, 4/21/06                  419,992           419,289
Series 2003-4, Cl. A2, 1.58%, 7/17/06                  524,914           523,743
- --------------------------------------------------------------------------------
Household Automotive Trust,
Automobile Loan Certificates,
Series 2003-2, Cl. A2,
1.56%, 12/18/06                                        192,376           191,996
- --------------------------------------------------------------------------------
M&I Auto Loan Trust,
Automobile Loan Certificates:
Series 2002-1, Cl. A3,
2.49%, 10/22/07                                        229,259           229,227
Series 2003-1, Cl. A2, 1.60%, 7/20/06                  371,164           370,628
- --------------------------------------------------------------------------------
National City Auto Receivables
Trust, Automobile Receivable
Obligations, Series 2004-A, Cl. A2,
1.50%, 2/15/07                                         431,428           429,910


            7 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- --------------------------------------------------------------------------------
NC Finance Trust, Collateralized
Mtg. Obligations, Series 1999-I,
Cl. ECFD, 8.75%, 1/25/29 2                       $      66,744   $        17,812
- --------------------------------------------------------------------------------
Nissan Auto Lease Trust,
Automobile Lease Obligations:
Series 2003-A, Cl. A2,
1.69%, 12/15/05                                         35,559            35,559
Series 2004-A, Cl. A2,
2.55%, 1/15/07                                         480,000           479,674
- --------------------------------------------------------------------------------
Nissan Auto Receivables Owner
Trust, Automobile Receivable Nts.:
Series 2002-A, Cl. A4,
4.28%, 10/16/06                                        120,752           121,361
Series 2003-B, Cl. A3,
1.51%, 8/15/07                                         125,776           124,783
Series 2004-A, Cl. A2,
1.40%, 7/17/06                                         499,348           497,341
- --------------------------------------------------------------------------------
Option One Mortgage Loan
Trust, Home Equity Mtg.
Obligations, Series 2004-3, Cl. A2,
2.568%, 11/25/34 1,2                                   326,595           326,805
- --------------------------------------------------------------------------------
Popular ABS Mortgage
Pass-Through Trust, Home Equity
Pass-Through Certificates,
Series 2004-5, Cl. A F2,
3.735%, 11/10/34 2                                     200,000           199,334
- --------------------------------------------------------------------------------
Sequoia Capital Ltd.,
Catastrophe Nts.,
Series 2004-2, 7.24%, 3/15/05 1                        250,000           249,931
- --------------------------------------------------------------------------------
Toyota Auto Receivables Owner
Trust, Automobile
Mtg.-Backed Obligations:
Series 2002-B, Cl. A3,
3.76%, 6/15/06                                          38,998            39,054
Series 2003-B, Cl. A2,
1.43%, 2/15/06                                         162,898           162,799
- --------------------------------------------------------------------------------
USAA Auto Owner Trust,
Automobile Loan Asset-Backed Nts.:
Series 2002-1, Cl. A3,
2.41%, 10/16/06                                        102,245           102,242
Series 2004-1, Cl. A2,
1.43%, 9/15/06                                       1,196,193         1,192,385
Series 2004-2, Cl. A2,
2.41%, 2/15/07                                         610,000           608,073
Series 2004-3, Cl. A2,
2.79%, 6/15/07                                         490,000           489,033
- --------------------------------------------------------------------------------
Volkswagen Auto Lease Trust,
Automobile Lease Asset-Backed
Securities, Series 2004-A, Cl. A2,
2.47%, 1/22/07                                         640,000           637,075


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES Continued
- --------------------------------------------------------------------------------
Volkswagen Auto Loan Enhanced
Trust, Automobile Loan
Receivable Certificates:
Series 2003-1, Cl. A2,
1.11%, 12/20/05                                  $      73,599   $        73,574
Series 2003-2, Cl. A2,
1.55%, 6/20/06                                         283,939           283,387
- --------------------------------------------------------------------------------
Wachovia Auto Owner Trust,
Automobile Receivable Nts.,
Series 2004-B, Cl. A2,
2.40%, 5/21/07                                         460,000           458,107
- --------------------------------------------------------------------------------
Wells Fargo Home Equity Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. AI1B,
2.94%, 9/25/18                                         946,271           941,898
- --------------------------------------------------------------------------------
Whole Auto Loan Trust,
Automobile Loan Receivable
Certificates:
Series 2003-1, Cl. A2A,
1.40%, 4/15/06                                         383,197           382,479
Series 2003-1, Cl. A3B,
1.99%, 5/15/07                                         220,000           218,151
Series 2004-1, Cl. A2A,
2.59%, 5/15/07                                         620,000           617,718
                                                                 ---------------
Total Asset-Backed Securities
(Cost $22,179,442)                                                    20,272,622

- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS--12.7%
- --------------------------------------------------------------------------------
Asset Securitization Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1997-D4, Cl. B1,
7.525%, 4/14/29                                        375,000           433,282
- --------------------------------------------------------------------------------
Banc of America Commercial
Mortgage, Inc., Commercial Mtg.
Pass-Through Certificates,
Series 2004-6, Cl. A3,
4.512%, 12/10/42                                       560,000           560,000
- --------------------------------------------------------------------------------
Bank of America Mortgage
Securities, Inc., Collateralized
Mtg. Obligations Pass-Through
Certificates:
Series 2004-2, Cl. 2A1,
6.50%, 7/20/32                                         982,015         1,003,277
Series 2004-8, Cl. 5A1,
6.50%, 5/25/32                                         785,464           816,147
Series 2004-E, Cl. 2A9,
3.712%, 6/25/34                                        497,824           498,138
Series 2004-G, Cl. 2A1,
2.469%, 8/25/34                                        368,414           367,688
- --------------------------------------------------------------------------------
CIT Equipment Collateral,
Equipment Receivable-
Backed Nts.,
Series 2003-EF1, Cl. A2,
1.49%, 12/20/05                                         38,995            39,003


            8 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS Continued
- --------------------------------------------------------------------------------
Countrywide Alternative Loan Trust,
Collateralized Mtg. Obligations,
Series 2004-J9, Cl. 1A1,
2.598%, 10/25/34 1                               $     765,604   $       766,485
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.:
5%, 1/1/35 5                                         9,609,000         9,542,938
5.50%, 1/1/35 5                                      3,040,000         3,088,452
6%, 9/1/24                                           3,647,046         3,792,091
7%, 3/1/31-11/1/34                                   4,646,138         4,926,953
11%, 11/1/14                                            63,381            69,407
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.,
Collateralized Mtg. Obligations,
Pass-Through Participation
Certificates, Series 151, Cl. F,
9%, 5/15/21                                            108,068           108,128
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Gtd. Real Estate Mtg.
Investment Conduit Multiclass
Pass-Through Certificates:
Series 1669, Cl. G, 6.50%, 2/15/23                     145,350           146,508
Series 2055, Cl. ZM, 6.50%, 5/15/28                    366,469           381,155
Series 2080, Cl. Z, 6.50%, 8/15/28                     227,788           234,885
Series 2387, Cl. PD, 6%, 4/15/30                       491,475           509,443
Series 2466, Cl. PD, 6.50%, 4/15/30                    139,825           140,498
Series 2498, Cl. PC, 5.50%, 10/15/14                    60,326            60,843
Series 2500, Cl. FD, 2.903%, 3/15/32 1                 138,846           139,391
Series 2526, Cl. FE, 2.803%, 6/15/29 1                 170,408           171,021
Series 2551, Cl. FD, 2.803%, 1/15/33 1                 136,801           137,739
Series 2551, Cl. TA, 4.50%, 2/15/18                     59,590            59,552
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage
Corp., Interest-Only Stripped
Mtg.-Backed Security:
Series 177, Cl. B, (1.91)%, 7/1/26 6                   430,500            79,803
Series 192, Cl. IO, 3.27%, 2/1/28 6                    112,605            20,926
Series 200, Cl. IO, 2.89%, 1/1/29 6                    137,998            26,456
Series 205, Cl. IO, (0.22)%, 9/1/29 6                  648,115           121,500
Series 208, Cl. IO, (29.18)%, 6/1/30 6                 741,029           136,045
Series 2074, Cl. S, 11.86%, 7/17/28 6                  144,882            18,659
Series 2079, Cl. S, 10.47%, 7/17/28 6                  225,939            29,433
Series 2526, Cl. SE, 17.17%, 6/15/29 6                 318,589            25,898
- --------------------------------------------------------------------------------
Federal National Mortgage Assn.:
4.50%, 1/1/20 5                                      3,175,000         3,165,078
5%, 1/1/20-1/1/35 5                                  5,784,000         5,802,086
5.50%, 3/1/33-1/1/34                                 5,067,193         5,150,261
5.50%, 1/1/35 5                                     15,257,000        15,490,615
6%, 9/1/24                                           1,095,238         1,139,933
6%, 1/1/35 5                                         5,145,000         5,320,249
6.50%, 5/1/29-10/1/30                                  349,551           367,350
6.50%, 1/1/35 5                                      5,741,000         6,020,874
7%, 12/1/23-8/1/34                                  11,386,535        12,074,521
7%, 8/1/28-1/1/35 5                                  4,961,590         5,258,944
7.50%, 8/1/25-2/1/27                                   303,017           325,469
8.50%, 7/1/32                                           30,386            33,011


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS Continued
- --------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Collateralized Mtg. Obligations,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates:
Trust 1998-63, Cl. PG, 6%, 3/25/27               $     134,095   $       134,735
Trust 2001-50, Cl. NE, 6%, 8/25/30                     263,368           267,008
Trust 2001-70, Cl. LR, 6%, 9/25/30                     257,913           262,970
Trust 2001-72, Cl. NH, 6%, 4/25/30                     206,421           211,102
Trust 2001-74, Cl. PD, 6%, 5/25/30                      87,676            88,865
Trust 2002-50, Cl. PD, 6%, 9/25/27                     143,345           143,441
Trust 2002-77, Cl. WF,
2.81%, 12/18/32 1                                      219,585           220,883
Trust 2002-94, Cl. MA,
4.50%, 8/25/09                                         389,325           390,178
Trust 2003-81, Cl. PA, 5%, 2/25/12                     110,657           111,064
Trust 2004-101, Cl. BG, 5%, 1/25/20                    630,000           635,513
- --------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates,
Interest-Only Stripped
Mtg.-Backed Security:
Trust 319, Cl. 2, (3.08)% 2/1/32 6                     280,066            53,832
Trust 2002-28, Cl. SA,
12.58%, 4/25/32 6                                      171,247            17,021
Trust 2002-38, Cl. SO,
19.60%, 4/25/32 6                                      941,721            75,715
Trust 2002-48, Cl. S,
10.91%, 7/25/32 6                                      274,141            28,629
Trust 2002-52, Cl. SL,
11.27%, 9/25/32 6                                      172,075            18,084
Trust 2002-56, Cl. SN,
13.38%, 7/25/32 6                                      376,704            39,455
Trust 2002-77, Cl. IS,
15.90%, 12/18/32 6                                   1,604,414           169,157
- --------------------------------------------------------------------------------
Federal National Mortgage Assn.,
Interest-Only Stripped
Mtg.-Backed Security:
Trust 214, Cl. 2, 1.30%, 3/1/23 6                    1,743,262           332,038
Trust 221, Cl. 2, (1.23)%, 5/1/23 6                    197,058            38,107
Trust 240, Cl. 2, 3.35%, 9/1/23 6                      340,010            64,752
Trust 301, Cl. 2, (3.70)%, 4/1/29 6                    841,291           159,680
Trust 313, Cl. 2, (29.08)%, 7/1/31 6                   930,965           179,140
Trust 321, Cl. 2, (3.53)%, 3/1/32 6                  1,238,418           246,105
Trust 324, Cl. 2, (9.92)%, 6/1/32 6                  2,154,476           438,653
Trust 333, Cl. 2, 2.31%, 3/1/33 6                      817,230           176,743
Trust 2001-63, Cl. SD,
17.40%, 12/18/31 6                                     295,586            31,275
Trust 2001-68, Cl. SC,
13.63%, 11/25/31 6                                     217,386            23,651
Trust 2001-81, Cl. S,
13.68%, 1/25/32 6                                      297,295            36,260
Trust 2002-9, Cl. MS,
10.62%, 3/25/32 6                                      367,130            40,046
Trust 2002-77, Cl. SH,
21.15%, 12/18/32 6                                     371,337            37,605


            9 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS Continued
- --------------------------------------------------------------------------------
First Chicago/Lennar Trust 1,
Commercial Mtg. Pass-Through
Certificates,
Series 1997-CHL1, Cl. D,
7.863%, 4/29/39 1,2                              $     350,000   $       356,617
- --------------------------------------------------------------------------------
First Union National Bank/
Lehman Brothers/Bank of
America Commercial Mtg. Trust,
Pass-Through Certificates,
Series 1998-C2, Cl. A2,
6.56%, 11/18/35                                        360,000           387,274
- --------------------------------------------------------------------------------
GE Capital Commercial
Mortgage Corp.,
Commercial Mtg. Obligations,
Series 2004-C3, Cl. A2,
4.433%, 7/10/39                                        390,000           395,179
- --------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc.,
Commercial Mtg. Obligations,
Series 2004-C3, Cl. A4,
4.547%, 12/10/41                                       360,000           360,947
- --------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc., Commercial Mtg.
Pass-Through Certificates,
Series 1997-C1, Cl. A3,
6.869%, 7/15/29                                        294,379           311,620
- --------------------------------------------------------------------------------
GMAC Commercial Mortgage
Securities, Inc., Mtg. Pass-Through
Certificates, Series 1998-C1, Cl. F,
7.089%, 5/15/30 1                                    1,800,000         1,883,750
- --------------------------------------------------------------------------------
Government National
Mortgage Assn.:
4.625%, 11/20/25 1                                      18,008            18,430
7%, 3/15/28-7/15/28                                  1,148,877         1,223,374
7.50%, 2/15/27                                         158,177           170,305
8%, 11/15/25-5/15/26                                   148,485           161,741
- --------------------------------------------------------------------------------
Government National
Mortgage Assn., Interest-Only
Stripped Mtg.-Backed Security:
Series 1998-6, Cl. SA,
8.73%, 3/16/28 6                                       275,939            33,487
Series 1998-19, Cl. SB,
10.70%, 7/16/28 6                                      461,648            60,289
Series 2001-21, Cl. SB,
14.94%, 1/16/27 6                                    2,222,960           212,607
- --------------------------------------------------------------------------------
GS Mortgage Securities Corp. II,
Commercial Mtg. Pass-Through
Certificates:
Series 2004-C1, Cl. A1,
3.659%, 10/10/28                                       407,183           402,757
Series 2004-GG2, Cl. A3,
4.602%, 8/10/38                                        250,000           255,071


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS Continued
- --------------------------------------------------------------------------------
GSR Mortgage Loan Trust,
Collateralized Mtg. Obligations,
Series 04-12, Cl. 3A1,
4.593%, 12/25/34 1,2                             $   1,176,093   $     1,177,713
- --------------------------------------------------------------------------------
Mastr Alternative Loan Trust,
Pass-Through Collateralized Mtg.
Obligations, Series 2004-6, Cl. 10A1,
6%, 7/25/34                                          1,125,260         1,161,934
- --------------------------------------------------------------------------------
Mastr Seasoned Securities Trust,
Collateralized Mtg. Obligations,
Series 2004-2, Cl. PT65,
6.50%, 12/1/34 5                                     1,625,000         1,673,496
- --------------------------------------------------------------------------------
Merrill Lynch Mortgage Investors,
Inc., Mtg. Pass-Through Certificates,
Series 1995-C2, Cl. D,
7.545%, 6/15/21 1                                      165,632           169,720
- --------------------------------------------------------------------------------
Morgan Stanley Capital I Trust,
Commercial Mtg. Pass-Through
Certificates:
Series 1996-C1, Cl. F,
7.472%, 2/15/28 1,7                                    162,744           150,727
Series 1997-XL1, Cl. G,
7.695%, 10/3/30                                        390,000           258,472
- --------------------------------------------------------------------------------
Nomura Asset Securities Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1998-D6, Cl. A1B,
6.59%, 3/15/30                                         420,000           454,560
- --------------------------------------------------------------------------------
Prudential Mortgage Capital Co.
II LLC, Commercial Mtg.
Pass-Through Certificates,
Series PRU-HTG 2000-C1, Cl. A2,
7.306%, 10/6/15                                        556,000           640,926
- --------------------------------------------------------------------------------
Salomon Brothers Mortgage
Securities VII, Inc., Commercial
Mtg. Pass-Through Certificates:
Series 1996-B, Cl. 1,
4.357%, 4/25/26 1,2                                      5,768             5,325
Series 1996-C1, Cl. F,
8.384%, 1/20/28 1,2                                  1,000,000           823,125
- --------------------------------------------------------------------------------
Washington Mutual Mortgage
Securities Corp., Collateralized
Mtg. Pass-Through Certificates,
Series 2003-AR12, Cl. A2,
2.446%, 2/25/34 1                                        9,652             9,658
- --------------------------------------------------------------------------------
Wells Fargo Mortgage Backed
Securities Trust, Collateralized
Mtg. Obligations:
Series 2004-DD, Cl. 2 A1,
4.548%, 1/25/35                                      1,290,000         1,292,116
Series 2004-N, Cl. A10,
3.803%, 8/25/34 2                                      966,317           969,495
Series 2004-W, Cl. A2,
4.635%, 11/25/34 1                                     575,342           576,930
                                                                 ---------------
Total Mortgage-Backed
Obligations (Cost $109,143,597)                                      108,869,487


            10 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS--8.8%
- --------------------------------------------------------------------------------
Federal Home Loan Bank
Unsec. Bonds, 2.75%, 10/15/06                    $   5,135,000   $     5,096,575
- --------------------------------------------------------------------------------
Federal Home Loan
Mortgage Corp. Nts.,
3.75%, 7/15/09 [EUR]                                 1,090,000         1,521,140
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.
Unsec. Nts., 6.875%, 9/15/10                         4,420,000         5,051,901
- --------------------------------------------------------------------------------
Federal National
Mortgage Assn. Unsec. Nts.:
1.80%, 5/27/05                                       1,390,000         1,386,226
2.50%, 6/15/06                                       1,325,000         1,313,765
3.01%, 6/2/06                                        1,400,000         1,394,277
4.25%, 7/15/07                                       6,465,000         6,604,437
6.625%, 9/15/09                                      8,000,000         8,941,696
7.25%, 1/15/10-5/15/30                               5,765,000         6,733,930
- --------------------------------------------------------------------------------
Resolution Funding Corp. Federal
Book Entry Principal Strips,
5.85%, 1/15/21 8                                     1,220,000           535,562
- --------------------------------------------------------------------------------
Tennessee Valley Authority Bonds:
7.125%, 5/1/30                                         330,000           411,820
Series A, 6.79%, 5/23/12                             9,663,000        11,143,024
- --------------------------------------------------------------------------------
U.S. Treasury Bonds:
5.50%, 8/15/28                                       1,034,000         1,119,467
7.25%, 5/15/16                                       1,670,000         2,090,893
8.875%, 8/15/17 9                                    1,630,000         2,310,398
9.25%, 2/15/16                                         208,000           296,977
STRIPS, 4.20%, 2/15/11 8                               900,000           708,919
STRIPS, 4.60%, 2/15/16 8                               491,000           295,829
- --------------------------------------------------------------------------------
U.S. Treasury Nts.:
2.50%, 9/30/06-10/31/06                             14,025,000        13,903,978
2.75%, 8/15/07 10,11                                   525,000           519,401
2.75%, 7/31/06 9                                     3,839,000         3,827,756
                                                                 ---------------
Total U.S. Government
Obligations (Cost $75,011,468)                                        75,207,971

- --------------------------------------------------------------------------------
FOREIGN GOVERNMENT OBLIGATIONS--29.9%
- --------------------------------------------------------------------------------
ARGENTINA--0.8%
Argentina (Republic of) Bonds:
1.98%, 8/3/12 1                                      6,465,000         5,438,849
2.352%, 5/3/05 1                                        56,000            55,064
Series PRE8, 2%, 1/3/10 2,3,4 [ARP]                  1,980,000           997,161
Series PR12, 2%, 1/3/16 2,3,4 [ARP]                  1,335,300           574,999
- --------------------------------------------------------------------------------
Argentina (Republic of) Disc. Bonds,
3/31/23 2,3,4                                          260,000           146,900
- --------------------------------------------------------------------------------
Buenos Aires (Province of) Bonds,
Bonos de Consolidacion de Deudas,
Series PBA1, 4/1/07 2,3,4 [ARP]                         59,785            24,123
                                                                 ---------------
                                                                       7,237,096
- --------------------------------------------------------------------------------
AUSTRALIA--0.8%
Queensland Treasury Corp.
Unsec. Nts., Series 09G,
6%, 7/14/09 [AUD]                                    8,300,000         6,670,330



                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
AUSTRIA--0.9%
Austria (Republic of) Bonds,
6.25%, 7/15/27 [EUR]                                 3,480,000   $     6,113,012
- --------------------------------------------------------------------------------
Austria (Republic of) Nts.,
Series 98-1, 5%, 1/15/08 [EUR]                       1,095,000         1,586,512
                                                                 ---------------
                                                                       7,699,524

- --------------------------------------------------------------------------------
BELGIUM--1.4%
Belgium (Kingdom of) Bonds:
5%, 9/28/11 [EUR]                                      540,000           806,734
Series 19, 6.50%, 3/31/05 [EUR]                      1,180,000         1,620,114
Series 26, 6.25%, 3/28/07 [EUR]                      2,170,000         3,184,063
Series 28, 5.75%, 3/28/08 [EUR]                        755,000         1,120,134
Series 32, 3.75%, 3/28/09 [EUR]                      2,905,000         4,070,238
Series 35, 5.75%, 9/28/10 [EUR]                      1,050,000         1,616,175
                                                                 ---------------
                                                                      12,417,458

- --------------------------------------------------------------------------------
BRAZIL--2.2%
Brazil (Federal Republic of) Bonds:
8.875%, 10/14/19                                     1,030,000         1,088,195
10.50%, 7/14/14                                        725,000           860,938
Series 15 yr., 3.125%, 4/15/09 1                        13,236            13,170
- --------------------------------------------------------------------------------
Brazil (Federal Republic of) Debt
Capitalization Bonds, Series 20 yr.,
8%, 4/15/14                                          7,252,993         7,429,785
- --------------------------------------------------------------------------------
Brazil (Federal Republic of) Nts.,
12%, 4/15/10                                         4,015,000         4,978,600
- --------------------------------------------------------------------------------
Brazil (Federal Republic of)
Unsec. Unsub. Bonds:
10%, 8/7/11                                            760,000           884,640
11%, 8/17/40                                         1,905,000         2,262,664
Cl. B, 8.875%, 4/15/24                                 958,000           996,320
                                                                 ---------------
                                                                      18,514,312

- --------------------------------------------------------------------------------
BULGARIA--0.2%
Bulgaria (Republic of) Bonds:
8.25%, 1/15/15                                         800,000         1,004,000
8.25%, 1/15/15 7                                       800,000         1,004,000
                                                                 ---------------
                                                                       2,008,000

- --------------------------------------------------------------------------------
COLOMBIA--0.5%
Colombia (Republic of) Nts.,
11.75%, 3/1/10 [COP]                             3,755,000,000         1,640,708
- --------------------------------------------------------------------------------
Colombia (Republic of) Unsec.
Unsub. Bonds, 8.375%, 2/15/27                          615,000           599,625
- --------------------------------------------------------------------------------
Colombia (Republic of) Unsec.
Unsub. Nts., 11.375%, 1/31/08 [EUR]                  1,125,000         1,829,100
                                                                 ---------------
                                                                       4,069,433

- --------------------------------------------------------------------------------
DENMARK--0.3%
Denmark (Kingdom of) Nts.,
4%, 8/15/08 [DKK]                                   12,375,000         2,344,727
- --------------------------------------------------------------------------------
DOMINICAN REPUBLIC--0.1%
Dominican Republic Bonds,
Series REGS, 9.04%, 1/23/13                            720,000           610,200


            11 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ECUADOR--0.2%
Ecuador (Republic of) Unsec.
Bonds, 8%, 8/15/30 1                             $   1,810,000   $     1,570,175
- --------------------------------------------------------------------------------
EL SALVADOR--0.1%
El Salvador (Republic of) Bonds,
7.625%, 9/21/34 7                                      590,000           610,650
- --------------------------------------------------------------------------------
FINLAND--0.0%
Finland (Republic of) Sr. Unsec.
Unsub. Bonds, 2.75%, 7/4/06 [EUR]                      220,000           300,721
- --------------------------------------------------------------------------------
FRANCE--2.2%
France (Government of)
Obligations Assimilables du
Tresor Bonds:
5.50%, 10/25/07 [EUR]                                1,080,000         1,577,061
5.50%, 10/25/10 [EUR]                                6,085,000         9,266,867
5.75%, 10/25/32 [EUR]                                3,300,000         5,555,232
- --------------------------------------------------------------------------------
France (Government of)
Treasury Nts.:
3 yr., 3.50%, 1/12/05 [EUR]                          1,460,000         1,985,308
5 yr., 4.75%, 7/12/07 [EUR]                            120,000           171,593
                                                                 ---------------
                                                                      18,556,061

- --------------------------------------------------------------------------------
GERMANY--2.6%
Germany (Republic of) Bonds:
2%, 6/17/05 [EUR]                                    2,120,000         2,880,169
5.375%, 1/4/10 [EUR]                                 1,285,000         1,928,635
Series 01, 5%, 7/4/11 [EUR]                          3,685,000         5,494,692
Series 140, 4.50%, 8/17/07 [EUR]                     1,395,000         1,983,756
Series 143, 3.50%, 10/10/08 [EUR]                    7,470,000        10,374,944
                                                                 ---------------
                                                                      22,662,196

- --------------------------------------------------------------------------------
GREECE--1.9%
Greece (Republic of) Bonds:
3.50%, 4/18/08 [EUR]                                 1,055,000         1,462,521
4.60%, 5/20/13 [EUR]                                 1,545,000         2,234,250
5.35%, 5/18/11 [EUR]                                 6,735,000        10,152,575
- --------------------------------------------------------------------------------
Greece (Republic of) Sr.
Unsub. Bonds, 4.65%, 4/19/07 [EUR]                   1,610,000         2,285,355
                                                                 ---------------
                                                                      16,134,701

- --------------------------------------------------------------------------------
GUATEMALA--0.0%
Guatemala (Republic of) Nts.:
10.25%, 11/8/11 7                                      250,000           295,938
10.25%, 11/8/11                                         95,000           112,456
                                                                 ---------------
                                                                         408,394

- --------------------------------------------------------------------------------
IRELAND--0.2%
Ireland (Republic of) Treasury Bonds,
3.25%, 4/18/09 [EUR]                                 1,045,000         1,434,620
- --------------------------------------------------------------------------------
ISRAEL--0.1%
United States (Government of) Gtd.
Israel Aid Bonds, 5.50%, 12/4/23                       960,000         1,006,320


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ITALY--1.7%
Italy (Republic of) Treasury Bonds:
Buoni del Tesoro Poliennali,
4%, 3/1/05 [EUR]                                       520,000   $       708,916
Buoni del Tesoro Poliennali,
4.50%, 3/1/07 [EUR]                                  1,150,000         1,626,444
Buoni del Tesoro Poliennali,
5%, 10/15/07 [EUR]                                   5,080,000         7,324,121
Buoni del Tesoro Poliennali,
5%, 2/1/12 [EUR]                                     1,030,000         1,535,690
Buoni del Tesoro Poliennali,
5.25%, 12/15/05 [EUR]                                2,590,000         3,611,989
                                                                 ---------------
                                                                      14,807,160

- --------------------------------------------------------------------------------
IVORY COAST--0.0%
Ivory Coast (Government of)
Past Due Interest Bonds,
3/29/18 2,3,4 [FRF]                                  2,194,500            76,737
- --------------------------------------------------------------------------------
JAPAN--2.0%
Japan (Government of) Bonds,
5 yr., Series 14, 0.40%, 6/20/06 [JPY]           1,719,000,000        16,864,301
- --------------------------------------------------------------------------------
KOREA, REPUBLIC OF SOUTH--0.2% Korea (Republic of) Nts.:
4.25%, 6/1/13                                          780,000           749,174
8.875%, 4/15/08                                      1,170,000         1,359,615
                                                                 ---------------
                                                                       2,108,789

- --------------------------------------------------------------------------------
MEXICO--0.8%
United Mexican States Bonds:
7.50%, 4/8/33                                          930,000         1,006,725
8.30%, 8/15/31                                         400,000           469,800
Series MI10, 8%, 12/19/13 [MXN]                      9,290,000           745,424
Series M20, 8%, 12/7/23 [MXN]                       23,040,000         1,672,890
- --------------------------------------------------------------------------------
United Mexican States Nts.,
7.50%, 1/14/12                                       1,300,000         1,477,450
- --------------------------------------------------------------------------------
United Mexican States Unsec.
Unsub. Nts.,
Series 6 BR, 6.75%, 6/6/06 [JPY]                   155,000,000         1,649,078
                                                                 ---------------
                                                                       7,021,367

- --------------------------------------------------------------------------------
NEW ZEALAND--0.1%
New Zealand (Government of)
Bonds, 7%, 7/15/09 12 [NZD]                            945,000           708,711
- --------------------------------------------------------------------------------
NIGERIA--0.1%
Central Bank of Nigeria
Gtd. Bonds,
Series WW, 6.25%, 11/15/20                             275,000           258,500
- --------------------------------------------------------------------------------
Nigeria (Federal Republic of)
Promissory Nts.,
Series RC, 5.092%, 1/5/10                              234,574           203,111
                                                                 ---------------
                                                                         461,611


            12 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
PANAMA--0.8%
Panama (Republic of) Bonds:
7.25%, 3/15/15                                   $   3,030,000   $     3,166,350
8.125%, 4/28/34                                        805,000           853,300
9.375%, 1/16/23                                      2,215,000         2,569,400
                                                                 ---------------
                                                                       6,589,050

- --------------------------------------------------------------------------------
PERU--0.3%
Peru (Republic of) Past Due
Interest Bonds,
Series 20 yr., 5%, 3/7/17 1                          1,760,000         1,698,400
- --------------------------------------------------------------------------------
Peru (Republic of) Sr. Nts.,
4.53%, 2/28/16 8                                     1,464,785           884,525
                                                                 ---------------
                                                                       2,582,925

- --------------------------------------------------------------------------------
PHILIPPINES--0.1%
Philippines (Republic of) Bonds,
8.375%, 2/15/11                                        438,000           439,382
- --------------------------------------------------------------------------------
POLAND--1.3%
Poland (Republic of) Bonds:
Series 0K0805, 5.26%, 8/12/05 8 [PLZ]               17,265,000         5,558,069
Series DS0509, 6%, 5/24/09 [PLZ]                    10,840,000         3,604,407
Series DS1013, 5%, 10/24/13 [PLZ]                    4,640,000         1,458,191
Series WS0922, 5.75%, 9/23/22 [PLZ]                  1,000,000           337,184
                                                                 ---------------
                                                                      10,957,851

- --------------------------------------------------------------------------------
PORTUGAL--0.7%
Portugal (Republic of)
Obrig Do Tes Medio Prazo Nts.,
4.875%, 8/17/07 [EUR]                                1,620,000         2,324,085
- --------------------------------------------------------------------------------
Portugal (Republic of)
Obrig Do Tes Medio Prazo
Unsec. Unsub. Nts.,
5.85%, 5/20/10 [EUR]                                 2,450,000         3,771,268
                                                                 ---------------
                                                                       6,095,353

- --------------------------------------------------------------------------------
RUSSIA--1.3%
Aries Vermoegensverwaltungs
GmbH Credit Linked Nts.,
9.60%, 10/25/14                                      1,950,000         2,410,190
- --------------------------------------------------------------------------------
Aries Vermoegensverwaltungs
GmbH Unsub. Nts., Series B,
7.75%, 10/25/09 2 [EUR]                                700,000         1,084,681
- --------------------------------------------------------------------------------
Ministry Finance of Russia Debs.,
Series VI, 3%, 5/14/06 2                             1,980,000         1,947,934
- --------------------------------------------------------------------------------
Russian Federation Unsec.
Unsub. Bonds, 5%, 3/31/30 1,7                        3,065,000         3,172,275
- --------------------------------------------------------------------------------
Russian Federation Unsub. Nts.,
5%, 3/31/30 1                                        2,735,875         2,821,303
                                                                 ---------------
                                                                      11,436,383


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
SOUTH AFRICA--0.4%
South Africa (Republic of) Bonds:
Series R157,
13.50%, 9/15/15 [ZAR]                                7,300,000   $     1,790,648
Series R186,
10.50%, 12/21/26 [ZAR]                               2,960,000           693,472
Series R203,
8.25%, 9/15/17 [ZAR]                                 3,000,000           539,828
Series R204, 8%, 12/21/18 [ZAR]                      3,175,000           560,505
                                                                 ---------------
                                                                       3,584,453

- --------------------------------------------------------------------------------
SPAIN--1.6%
Spain (Kingdom of) Bonds:
Bonos y Obligacion del Estado,
5.35%, 10/31/11 [EUR]                                3,695,000         5,630,267
Bonos y Obligacion del Estado,
5.75%, 7/30/32 [EUR]                                 2,530,000         4,247,319
- --------------------------------------------------------------------------------
Spain (Kingdom of)
Treasury Bills,
2.10%, 2/18/05 8 [EUR]                               2,730,000         3,700,725
                                                                 ---------------
                                                                      13,578,311

- --------------------------------------------------------------------------------
SWEDEN--0.2%
Sweden (Kingdom of) Bonds,
Series 1043, 5%, 1/28/09 [SEK]                      10,760,000         1,733,975
- --------------------------------------------------------------------------------
THE NETHERLANDS--0.7% Netherlands (Kingdom of the) Bonds:
5%, 7/15/11 [EUR]                                    1,615,000         2,410,536
5.50%, 1/15/28 [EUR]                                 2,340,000         3,779,878
                                                                 ---------------
                                                                       6,190,414

- --------------------------------------------------------------------------------
TURKEY--0.4%
Turkey (Republic of) Nts.,
7.25%, 3/15/15                                       3,105,000         3,205,913
- --------------------------------------------------------------------------------
UNITED KINGDOM--1.9%
United Kingdom Treasury Nts.,
4%, 3/7/09 [GBP]                                     8,670,000        16,354,251
- --------------------------------------------------------------------------------
VENEZUELA--0.8%
Venezuela (Republic of) Nts.:
3.09%, 4/20/11 1                                       750,000           682,500
8.50%, 10/8/14                                       1,285,000         1,365,698
10.75%, 9/13/13                                      4,280,000         5,120,592
                                                                 ---------------
                                                                       7,168,790
                                                                 ---------------
Total Foreign Government
Obligations (Cost $227,294,778)                                      256,220,645


            13 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
LOAN PARTICIPATIONS--0.6%
- --------------------------------------------------------------------------------
Algeria (Republic of) Loan
Participation Nts., 2.183%, 3/4/10 1,2           $     427,167   $       420,759
- --------------------------------------------------------------------------------
Deutsche Bank AG:
Indonesia (Republic of) Rupiah
Loan Participation Nts.,
2.636%, 1/25/06 1                                    1,490,000         1,470,779
- --------------------------------------------------------------------------------
Indonesia (Republic of)
Rupiah Loan Participation Nts.,
2.636%, 3/21/05 1                                    1,330,000         1,331,530
OAO Gazprom Loan
Participation Nts., 6.50%, 8/4/05 2                  1,520,000         1,552,224
                                                                 ---------------
Total Loan Participations
(Cost $4,679,244)                                                      4,775,292

- --------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--28.0%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--8.0%
- --------------------------------------------------------------------------------
AUTO COMPONENTS--0.6%
ArvinMeritor, Inc., 8.75% Sr.
Unsec. Unsub. Nts., 3/1/12                             700,000           812,000
- --------------------------------------------------------------------------------
Collins & Aikman
Floorcoverings, Inc.,
9.75% Sr. Sub. Nts.,
Series B, 2/15/10                                      200,000           216,000
- --------------------------------------------------------------------------------
Cooper Standard
Automotive Group:
7% Sr. Nts., 12/15/12 7                                 90,000            91,800
8.375% Sr. Sub. Nts., 12/15/14 7                       425,000           426,063
- --------------------------------------------------------------------------------
Dana Corp.,
10.125% Nts., 3/15/10 2                                200,000           226,716
- --------------------------------------------------------------------------------
Dura Operating Corp.:
9% Sr. Sub. Nts., Series B,
5/1/09 [EUR]                                           200,000           258,257
9% Sr. Unsec. Sub. Nts.,
Series D, 5/1/09                                       500,000           497,500
- --------------------------------------------------------------------------------
Eagle-Picher, Inc.,
9.75% Sr. Nts., 9/1/13                                 300,000           301,500
- --------------------------------------------------------------------------------
Goodyear Tire &
Rubber Co. (The),
7.857% Nts., 8/15/11                                   500,000           510,000
- --------------------------------------------------------------------------------
Metaldyne Corp.:
10% Sr. Nts., 11/1/13 7                                200,000           191,000
11% Sr. Sub. Nts., 6/15/12                             300,000           250,500
- --------------------------------------------------------------------------------
Stoneridge, Inc.,
11.50% Sr. Nts., 5/1/12                                500,000           583,750
- --------------------------------------------------------------------------------
Tenneco Automotive, Inc.:
8.625% Sr. Sub. Nts., 11/15/14 7                       500,000           522,500
10.25% Sr. Sec. Nts.,
Series B, 7/15/13                                      150,000           177,750
- --------------------------------------------------------------------------------
United Components, Inc.,
9.375% Sr. Sub. Nts., 6/15/13                          200,000           218,000
                                                                 ---------------
                                                                       5,283,336


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--2.2%
Apcoa, Inc.,
9.25% Sr. Unsec. Sub. Nts., 3/15/08              $     100,000   $        98,500
- --------------------------------------------------------------------------------
Aztar Corp.,
9% Sr. Unsec. Sub. Nts., 8/15/11                       850,000           941,375
- --------------------------------------------------------------------------------
Boyd Gaming Corp.,
8.75% Sr. Sub. Nts., 4/15/12                           300,000           335,250
- --------------------------------------------------------------------------------
Carrols Corp.,
9% Sr. Sub. Nts., 1/15/13 7                            130,000           135,200
- --------------------------------------------------------------------------------
Domino's, Inc.,
8.25% Sr. Unsec. Sub. Nts., 7/1/11                     547,000           600,333
- --------------------------------------------------------------------------------
Gaylord Entertainment Co.,
8% Sr. Nts., 11/15/13                                  300,000           325,500
- --------------------------------------------------------------------------------
Hilton Hotels Corp.,
7.625% Nts., 12/1/12                                   400,000           468,482
- --------------------------------------------------------------------------------
Hollywood Park, Inc.,
9.25% Sr. Unsec. Sub. Nts.,
Series B, 2/15/07                                      325,000           332,313
- --------------------------------------------------------------------------------
Intrawest Corp.,
7.50% Sr. Unsec. Nts., 10/15/13                        625,000           667,969
- --------------------------------------------------------------------------------
Isle of Capri Casinos, Inc.:
7% Sr. Unsec. Sub. Nts., 3/1/14                        400,000           410,000
9% Sr. Sub. Nts., 3/15/12                              500,000           553,750
- --------------------------------------------------------------------------------
John Q. Hammons Hotels, Inc.,
8.875% Sr. Nts., Series B, 5/15/12                     300,000           340,500
- --------------------------------------------------------------------------------
La Quinta Properties, Inc.,
7% Sr. Sec. Nts., 8/15/12                              250,000           265,625
- --------------------------------------------------------------------------------
Mandalay Resort Group,
10.25% Sr. Unsec. Sub. Nts.,
Series B, 8/1/07                                       650,000           737,750
- --------------------------------------------------------------------------------
MGM Mirage, Inc.:
8.375% Sr. Unsec. Sub. Nts., 2/1/11                    600,000           679,500
9.75% Sr. Unsec. Sub. Nts., 6/1/07                     350,000           390,250
- --------------------------------------------------------------------------------
Mohegan Tribal
Gaming Authority:
6.375% Sr. Sub. Nts., 7/15/09                          250,000           258,125
8% Sr. Sub. Nts., 4/1/12                               200,000           218,000
- --------------------------------------------------------------------------------
NCL Corp.,
10.625% Sr. Nts., 7/15/14 7                            300,000           301,500
- --------------------------------------------------------------------------------
Park Place Entertainment Corp.:
7.875% Sr. Sub. Nts., 3/15/10                          200,000           226,250
9.375% Sr. Unsec. Sub. Nts.,
2/15/07                                                800,000           884,000
- --------------------------------------------------------------------------------
Pinnacle Entertainment, Inc.,
8.25% Sr. Unsec. Sub. Nts.,
3/15/12                                                700,000           747,250
- --------------------------------------------------------------------------------
Premier Cruise Ltd.,
11% Sr. Nts., 3/15/08 2,3,4                            250,000                --
- --------------------------------------------------------------------------------
Royal Caribbean Cruises Ltd.,
8.75% Sr. Unsub. Nts., 2/2/11                          300,000           355,875
- --------------------------------------------------------------------------------
Six Flags, Inc.:
8.875% Sr. Unsec. Nts., 2/1/10                       1,234,000         1,255,595
9.625% Sr. Nts., 6/1/14                                 19,000            19,190
9.75% Sr. Nts., 4/15/13                                100,000           102,000


            14 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE Continued
Starwood Hotels &
Resorts Worldwide, Inc.,
7.875% Sr. Nts., 5/1/12                          $     900,000   $     1,032,750
- --------------------------------------------------------------------------------
Station Casinos, Inc.:
6.50% Sr. Unsec. Sub. Nts., 2/1/14                     800,000           826,000
9.875% Sr. Unsec. Sub. Nts., 7/1/10                  1,000,000         1,057,500
- --------------------------------------------------------------------------------
Sun International Hotels Ltd.,
8.875% Sr. Unsec. Sub. Nts.,
8/15/11                                                700,000           768,250
- --------------------------------------------------------------------------------
Universal City Development
Partners Ltd.,
11.75% Sr. Nts., 4/1/10                                500,000           593,125
- --------------------------------------------------------------------------------
Vail Resorts, Inc.,
6.75% Sr. Sub. Nts., 2/15/14                           500,000           511,250
- --------------------------------------------------------------------------------
Venetian Casino Resort LLC/
Las Vegas Sands, Inc.,
11% Sec. Nts., 6/15/10                                 400,000           458,500
- --------------------------------------------------------------------------------
Wynn Las Vegas LLC/
Wynn Las Vegas Capital Corp.,
6.625% Nts., 12/1/14 7                               1,800,000         1,791,000
                                                                 ---------------
                                                                      18,688,457

- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES--0.6% Beazer Homes USA, Inc.,
8.375% Sr. Nts., 4/15/12                               400,000           442,000
- --------------------------------------------------------------------------------
Blount, Inc.,
8.875% Sr. Sub. Nts., 8/1/12                           350,000           381,500
- --------------------------------------------------------------------------------
D.R. Horton, Inc.: 9.375% Sr. Unsec. Sub. Nts.,
3/15/11                                                400,000           444,000
9.75% Sr. Sub. Nts., 9/15/10                           400,000           486,000
- --------------------------------------------------------------------------------
KB Home:
8.625% Sr. Sub. Nts., 12/15/08                         250,000           283,750
9.50% Sr. Unsec. Sub. Nts., 2/15/11                    400,000           442,000
- --------------------------------------------------------------------------------
Meritage Corp.,
9.75% Sr. Unsec. Nts., 6/1/11                          350,000           388,500
- --------------------------------------------------------------------------------
Sealy Mattress Co.,
8.25% Sr. Sub. Nts., 6/15/14                           450,000           479,250
- --------------------------------------------------------------------------------
Standard Pacific Corp.,
9.25% Sr. Sub. Nts., 4/15/12                           200,000           233,000
- --------------------------------------------------------------------------------
WCI Communities, Inc.,
9.125% Sr. Sub. Nts., 5/1/12                           300,000           334,500
- --------------------------------------------------------------------------------
William Lyon Homes, Inc.,
10.75% Sr. Nts., 4/1/13                                400,000           451,500
- --------------------------------------------------------------------------------
Williams Scotsman, Inc.,
9.875% Sr. Unsec. Nts., 6/1/07                         800,000           804,000
                                                                 ---------------
                                                                       5,170,000


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA--3.8%
Adelphia Communications Corp.:
7.875% Sr. Unsec. Nts., 5/1/09 3,4               $     350,000   $       327,250
10.25% Sr. Unsec. Nts., 11/1/06 3,4                    400,000           391,000
10.25% Sr. Unsec. Sub. Nts.,
6/15/11 3,4                                            200,000           203,500
10.875% Sr. Unsec. Nts., 10/1/10 3,4                   400,000           398,000
- --------------------------------------------------------------------------------
Allbritton Communications Co.,
7.75% Sr. Unsec. Sub. Nts.,
12/15/12                                               600,000           624,000
- --------------------------------------------------------------------------------
AMC Entertainment, Inc.:
8% Sr. Unsec. Sub. Nts., 3/1/14                        650,000           650,000
9.50% Sr. Unsec. Sub. Nts., 2/1/11                     360,000           373,950
- --------------------------------------------------------------------------------
American Media Operations, Inc.:
8.875% Sr. Unsec. Sub. Nts.,
1/15/11                                                150,000           160,313
10.25% Sr. Unsec. Sub. Nts.,
Series B, 5/1/09                                       400,000           423,500
- --------------------------------------------------------------------------------
Block Communications, Inc.,
9.25% Sr. Sub. Nts., 4/15/09                           400,000           438,000
- --------------------------------------------------------------------------------
Carmike Cinemas, Inc.,
7.50% Sr. Sub. Nts., 2/15/14                           500,000           514,375
- --------------------------------------------------------------------------------
Charter Communications
Holdings LLC/
Charter Communications
Holdings Capital Corp.:
0%/11.75% Sr. Unsec. Sub.
Disc. Nts., 5/15/11 13                                 925,000           684,500
8.375% Sr. Nts., Second Lien,
4/30/14 7                                            3,450,000         3,657,000
- --------------------------------------------------------------------------------
Cinemark USA, Inc.,
9% Sr. Unsec. Sub. Nts., 2/1/13                        300,000           343,875
- --------------------------------------------------------------------------------
Cinemark, Inc., 0%/9.75%
Sr. Unsec. Disc. Nts.,
3/15/14 13                                             500,000           380,000
- --------------------------------------------------------------------------------
Corus Entertainment, Inc.,
8.75% Sr. Sub. Nts., 3/1/12                            300,000           330,750
- --------------------------------------------------------------------------------
CSC Holdings, Inc.,
7.625% Sr. Unsec. Unsub. Nts.,
Series B, 4/1/11                                     1,100,000         1,190,750
- --------------------------------------------------------------------------------
Dex Media East LLC/
Dex Media East Finance Co.,
9.875% Sr. Unsec. Nts., 11/15/09                       200,000           228,750
- --------------------------------------------------------------------------------
Dex Media West LLC,
5.875% Sr. Nts., 11/15/11 7                            900,000           900,000
- --------------------------------------------------------------------------------
Dex Media West LLC/
Dex Media West Finance Co.:
8.50% Sr. Nts., 8/15/10                                300,000           335,250
9.875% Sr. Sub. Nts., 8/15/13                          586,000           678,295
- --------------------------------------------------------------------------------
Dex Media, Inc.,
8% Unsec. Nts., 11/15/13                             1,350,000         1,468,125
- --------------------------------------------------------------------------------
DirecTV Holdings LLC/
DirecTV Financing Co., Inc.,
8.375% Sr. Unsec. Nts., 3/15/13                      1,800,000         2,027,250


            15 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
EchoStar DBS Corp.:
6.625% Sr. Nts., 10/1/14 7                       $     800,000   $       814,000
9.125% Sr. Nts., 1/15/09                             1,075,000         1,187,875
- --------------------------------------------------------------------------------
Emmis Operating Co.,
6.875% Sr. Unsec. Sub. Nts.,
5/15/12                                                600,000           630,750
- --------------------------------------------------------------------------------
Entravision
Communications Corp.,
8.125% Sr. Sub. Nts., 3/15/09                          400,000           429,000
- --------------------------------------------------------------------------------
Granite Broadcasting Corp.,
9.75% Sr. Sec. Nts., 12/1/10                           619,000           594,240
- --------------------------------------------------------------------------------
Insight Midwest LP/
Insight Capital, Inc.,
9.75% Sr. Nts., 10/1/09                                200,000           210,500
- --------------------------------------------------------------------------------
Lin Television Corp.,
6.50% Sr. Sub. Nts., 5/15/13                           400,000           413,500
- --------------------------------------------------------------------------------
LodgeNet Entertainment Corp.,
9.50% Sr. Sub. Debs., 6/15/13                          200,000           222,000
- --------------------------------------------------------------------------------
Mediacom LLC/
Mediacom Capital Corp.,
9.50% Sr. Unsec. Nts., 1/15/13                         769,000           775,729
- --------------------------------------------------------------------------------
MediaNews Group, Inc.,
6.375% Sr. Sub. Nts., 4/1/14                           800,000           796,000
- --------------------------------------------------------------------------------
News America Holdings, Inc.,
8.875% Sr. Debs., 4/26/23                              625,000           814,644
- --------------------------------------------------------------------------------
PanAmSat Corp.,
9% Sr. Nts., 8/15/14 7                               1,000,000         1,121,250
- --------------------------------------------------------------------------------
PRIMEDIA, Inc.:
8% Sr. Nts., 5/15/13                                   900,000           930,375
8.875% Sr. Unsec. Nts., 5/15/11                         19,000            20,188
- --------------------------------------------------------------------------------
R.H. Donnelley Financial Corp. I,
10.875% Sr. Sub. Nts., 12/15/12 7                      400,000           477,000
- --------------------------------------------------------------------------------
Radio One, Inc.,
8.875% Sr. Unsec. Sub. Nts.,
Series B, 7/1/11                                       600,000           656,250
- --------------------------------------------------------------------------------
Rainbow National Services LLC,
8.75% Sr. Nts., 9/1/12 7                               800,000           882,000
- --------------------------------------------------------------------------------
Rogers Cable, Inc.,
6.75% Sr. Sec.
Second Priority Nts., 3/15/15 7                        250,000           256,875
- --------------------------------------------------------------------------------
Shaw Communications, Inc.,
8.54% Debs., 9/30/27 [CAD]                             340,000           283,771
- --------------------------------------------------------------------------------
Sinclair Broadcast Group, Inc.:
8% Sr. Unsec. Sub. Nts., 3/15/12                     1,050,000         1,120,875
8.75% Sr. Sub. Nts., 12/15/11                          300,000           328,125
- --------------------------------------------------------------------------------
Spanish Broadcasting System, Inc.,
9.625% Sr. Unsec. Sub. Nts., 11/1/09                   800,000           842,000
- --------------------------------------------------------------------------------
Vertis, Inc., 9.75% Sr.
Sec. Nts., 4/1/09                                      200,000           218,000
- --------------------------------------------------------------------------------
WMG Holdings Corp.:
0%/9.50% Sr. Disc. Nts., 12/15/14 7,13               1,000,000           643,750
6.905% Sr. Nts., 12/15/11 1,7                          400,000           405,000


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
WRC Media, Inc./
Weekly Reader Corp./
CompassLearning, Inc.,
12.75% Sr. Sub. Nts., 11/15/09                   $     500,000   $       478,125
                                                                 ---------------
                                                                      32,280,255

- --------------------------------------------------------------------------------
MULTILINE RETAIL--0.1% Saks, Inc.:
8.25% Sr. Unsec. Nts., 11/15/08                        700,000           770,000
9.875% Nts., 10/1/11                                   200,000           238,000
                                                                 ---------------
                                                                       1,008,000

- --------------------------------------------------------------------------------
SPECIALTY RETAIL--0.4%
Asbury Automotive Group, Inc.,
9% Sr. Sub. Nts., 6/15/12                              300,000           316,500
- --------------------------------------------------------------------------------
Atlantic Broadband Finance LLC,
9.375% Sr. Sub. Nts., 1/15/14 7                        250,000           243,125
- --------------------------------------------------------------------------------
AutoNation, Inc.,
9% Sr. Unsec. Nts., 8/1/08                             500,000           573,750
- --------------------------------------------------------------------------------
Boise Cascade LLC/
Boise Cascade Finance Corp.,
7.125% Sr. Sub. Nts., 10/15/14 7                       450,000           478,125
- --------------------------------------------------------------------------------
Eye Care Centers of America, Inc.,
9.125% Sr. Unsec. Sub. Nts., 5/1/08                    400,000           402,000
- --------------------------------------------------------------------------------
Finlay Fine Jewelry Corp.,
8.375% Sr. Unsec. Nts., 6/1/12                         400,000           434,000
- --------------------------------------------------------------------------------
Hollywood Entertainment Corp.,
9.625% Sr. Sub. Nts., 3/15/11                          300,000           319,500
- --------------------------------------------------------------------------------
Petco Animal Supplies, Inc.,
10.75% Sr. Sub. Nts., 11/1/11                          200,000           235,000
- --------------------------------------------------------------------------------
Rent-A-Center, Inc.,
7.50% Sr. Unsec. Sub. Nts.,
Series B, 5/1/10                                       150,000           156,188
                                                                 ---------------
                                                                       3,158,188

- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--0.3%
Invista, Inc., 9.25% Sr. Nts., 5/1/12 7                900,000         1,008,000
- --------------------------------------------------------------------------------
Levi Strauss & Co.:
9.75% Sr. Nts., 1/15/15 7                              500,000           497,500
12.25% Sr. Nts., 12/15/12                              600,000           670,500
- --------------------------------------------------------------------------------
Oxford Industries, Inc.,
8.875% Sr. Nts., 6/1/11                                250,000           269,688
- --------------------------------------------------------------------------------
Russell Corp., 9.25% Sr. Nts.,
5/1/10                                                 200,000           215,500
                                                                 ---------------
                                                                       2,661,188

- --------------------------------------------------------------------------------
CONSUMER STAPLES--1.0%
- --------------------------------------------------------------------------------
BEVERAGES--0.1%
Constellation Brands, Inc.,
8.125% Sr. Sub. Nts., 1/15/12                          300,000           327,375


            16 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--0.2%
Great Atlantic &
Pacific Tea Co., Inc. (The),
9.125% Sr. Nts., 12/15/11                        $     419,000   $       394,908
- --------------------------------------------------------------------------------
Ingles Markets, Inc.,
8.875% Sr. Unsec. Sub. Nts.,
12/1/11                                                 19,000            20,425
- --------------------------------------------------------------------------------
Jean Coutu Group (PJC), Inc. (The):
7.625% Sr. Nts., 8/1/12 7                              250,000           265,625
8.50% Sr. Sub. Nts., 8/1/14 7                          600,000           618,000
- --------------------------------------------------------------------------------
Real Time Data Co.,
11% Disc. Nts., 5/31/09 2,3,4,14                       142,981                --
- --------------------------------------------------------------------------------
Rite Aid Corp.:
8.125% Sr. Sec. Nts., 5/1/10                           450,000           478,125
9.50% Sr. Sec. Nts., 2/15/11                           200,000           220,500
                                                                 ---------------
                                                                       1,997,583

- --------------------------------------------------------------------------------
FOOD PRODUCTS--0.6%
American Seafoods Group LLC,
10.125% Sr. Sub. Nts., 4/15/10                         200,000           215,000
- --------------------------------------------------------------------------------
Burns Philp Capital Property Ltd.,
9.75% Sr. Unsec. Sub. Nts., 7/15/12                    450,000           497,250
- --------------------------------------------------------------------------------
Chiquita Brands International, Inc.,
7.50% Sr. Nts., 11/1/14 2                              150,000           152,625
- --------------------------------------------------------------------------------
Del Monte Corp.,
8.625% Sr. Sub. Nts., 12/15/12                         400,000           450,000
- --------------------------------------------------------------------------------
Doane Pet Care Co.:
9.75% Sr. Unsec. Sub. Nts., 5/15/07                    400,000           396,000
10.75% Sr. Nts., 3/1/10                                460,000           494,500
- --------------------------------------------------------------------------------
Dole Food Co., Inc.:
8.625% Sr. Nts., 5/1/09                                400,000           437,000
8.875% Sr. Unsec. Nts., 3/15/11                        200,000           218,500
- --------------------------------------------------------------------------------
Hines Nurseries, Inc.,
10.25% Sr. Unsec. Sub. Nts.,
10/1/11                                                200,000           219,500
- --------------------------------------------------------------------------------
Pinnacle Foods Holding Corp.:
8.25% Sr. Sub. Nts., 12/1/13 7                          40,000            38,300
8.25% Sr. Sub. Nts., 12/1/13 7                         400,000           383,000
- --------------------------------------------------------------------------------
Smithfield Foods, Inc.,
7.625% Sr. Unsec. Sub. Nts.,
2/15/08                                                400,000           430,000
- --------------------------------------------------------------------------------
United Biscuits Finance plc,
10.75% Sr. Sub. Nts., 4/15/11 2 [GBP]                  400,000           787,160
                                                                 ---------------
                                                                       4,718,835

- --------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--0.1%
Church & Dwight Co., Inc.,
6% Sr. Sub. Nts., 12/15/12 7                           300,000           306,750
- --------------------------------------------------------------------------------
Playtex Products, Inc.:
8% Sr. Sec. Nts., 3/1/11                               500,000           548,750
9.375% Sr. Unsec. Sub. Nts., 6/1/11                    200,000           214,500
                                                                 ---------------
                                                                       1,070,000


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.0%
Elizabeth Arden, Inc.,
7.75% Sr. Unsec. Sub. Nts., 1/15/14              $     175,000   $       186,375
- --------------------------------------------------------------------------------
ENERGY--3.1%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.3%
Dresser, Inc.,
9.375% Sr. Sub. Nts., 4/15/11                          300,000           330,000
- --------------------------------------------------------------------------------
Hanover Compress Co.,
8.625% Sr. Nts., 12/15/10                              300,000           329,250
- --------------------------------------------------------------------------------
Hanover Equipment Trust 2001A,
8.50% Sr. Sec. Nts., Series A, 9/1/08                  500,000           540,000
- --------------------------------------------------------------------------------
Hornbeck Offshore Services, Inc.,
6.125% Sr. Nts., 12/1/14 7                             350,000           353,500
- --------------------------------------------------------------------------------
Ocean Rig Norway AS,
10.25% Sr. Sec. Nts., 6/1/08                           575,000           595,125
- --------------------------------------------------------------------------------
Petroleum Helicopters, Inc.,
9.375% Sr. Nts., 5/1/09                                200,000           220,000
- --------------------------------------------------------------------------------
Universal Compression, Inc.,
7.25% Sr. Unsec. Sub. Nts., 5/15/10 2                  400,000           429,000
                                                                 ---------------
                                                                       2,796,875

- --------------------------------------------------------------------------------
OIL & GAS--2.8%
Chesapeake Energy Corp.:
6.375% Sr. Nts., 6/15/15 7                             250,000           258,125
6.875% Sr. Unsec. Nts., 1/15/16                        672,000           707,280
- --------------------------------------------------------------------------------
El Paso Corp.,
7.875% Sr. Unsec. Nts., 6/15/12                      1,519,000         1,596,849
- --------------------------------------------------------------------------------
El Paso Energy Corp.,
7.625% Nts., 7/15/11                                   200,000           208,000
- --------------------------------------------------------------------------------
El Paso Production Holding Co.,
7.75% Sr. Unsec. Nts., 6/1/13                        1,200,000         1,263,000
- --------------------------------------------------------------------------------
EXCO Resources, Inc.,
7.25% Sr. Nts., 1/15/11                                400,000           430,000
- --------------------------------------------------------------------------------
Forest Oil Corp.,
7.75% Sr. Nts., 5/1/14                                 300,000           327,750
- --------------------------------------------------------------------------------
Frontier Oil Corp.,
6.625% Sr. Nts., 10/1/11 7                             200,000           205,000
- --------------------------------------------------------------------------------
Gazprom International SA,
7.201% Sr. Unsec. Bonds, 2/1/20                      4,110,000         4,377,376
- --------------------------------------------------------------------------------
MarkWest Energy Partners LP/
MarkWest Energy Finance Corp.,
6.875% Sr. Nts., 11/1/14 7                             150,000           153,000
- --------------------------------------------------------------------------------
Newfield Exploration Co.:
6.625% Sr. Unsec. Sub. Nts., 9/1/14 7                  600,000           637,500
8.375% Sr. Sub. Nts., 8/15/12                          500,000           562,500
- --------------------------------------------------------------------------------
Pemex Project Funding Master Trust:
8.50% Unsub. Nts., 2/15/08                             420,000           474,600
9.125% Unsec. Unsub. Nts.,
10/13/10                                               610,000           732,915
- --------------------------------------------------------------------------------
Plains Exploration & Production Co.,
7.125% Sr. Nts., 6/15/14                               300,000           328,500


            17 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
OIL & GAS Continued
Premcor Refining Group, Inc.:
6.75% Sr. Nts., 5/1/14                           $     350,000   $       373,625
9.50% Sr. Nts., 2/1/13                                 900,000         1,048,500
- --------------------------------------------------------------------------------
Range Resources Corp.,
7.375% Sr. Sub. Nts., 7/15/13                          200,000           215,500
- --------------------------------------------------------------------------------
Southern Natural Gas Co.,
8% Sr. Unsub. Nts., 3/1/32 2                           300,000           328,875
- --------------------------------------------------------------------------------
Stone Energy Corp.,
6.75% Sr. Sub. Nts., 12/15/14 7                        170,000           170,425
- --------------------------------------------------------------------------------
Tengizchevroil LLP, 6.124% Nts.,
11/15/14 7                                           1,520,000         1,531,400
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co.,
7.50% Bonds, 4/1/17                                  1,800,000         1,993,500
- --------------------------------------------------------------------------------
Tesoro Petroleum Corp.:
8% Sr. Sec. Nts., 4/15/08                            1,000,000         1,092,500
9.625% Sr. Sub. Nts., 4/1/12                            19,000            21,945
- --------------------------------------------------------------------------------
Whiting Petroleum Corp.,
7.25% Sr. Sub. Nts., 5/1/12                            400,000           420,000
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The):
7.125% Nts., 9/1/11                                    800,000           878,000
7.625% Nts., 7/15/19                                 1,000,000         1,105,000
8.75% Unsec. Nts., 3/15/32                           1,400,000         1,615,250
- --------------------------------------------------------------------------------
XTO Energy, Inc., 7.50% Sr. Nts.,
4/15/12                                                500,000           585,943
                                                                 ---------------
                                                                      23,642,858

- --------------------------------------------------------------------------------
FINANCIALS--1.2%
- --------------------------------------------------------------------------------
CAPITAL MARKETS--0.3%
American Color Graphics, Inc.,
10% Sr. Sec. Nts., 6/15/10                             200,000           169,750
- --------------------------------------------------------------------------------
BCP Caylux Holdings
Luxembourg SCA,
9.625% Sr. Sub. Nts., 6/15/14 7                      1,250,000         1,415,625
- --------------------------------------------------------------------------------
Berry Plastics Corp.,
10.75% Sr. Sub. Nts., 7/15/12                          750,000           862,500
                                                                 ---------------
                                                                       2,447,875

- --------------------------------------------------------------------------------
COMMERCIAL BANKS--0.1%
Bank Plus Corp., 12% Sr. Nts.,
7/18/07                                                  7,000             7,525
- --------------------------------------------------------------------------------
BankUnited Capital Trust,
10.25% Capital Securities,
12/31/26                                               100,000           108,750
- --------------------------------------------------------------------------------
Inter-American
Development Bank,
6.26% Nts., 12/8/09 1 [BRR]                            920,000           347,252
- --------------------------------------------------------------------------------
Ongko International
Finance Co. BV,
10.50% Sec. Nts., 3/29/10 2,3,4                         90,000               563
- --------------------------------------------------------------------------------
Western Financial Bank,
9.625% Unsec. Sub. Debs., 5/15/12                      500,000           572,500
                                                                 ---------------
                                                                       1,036,590


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--0.4% Affinia Group, Inc.,
9% Sr. Sub. Nts., 11/30/14 7                     $     200,000   $       209,500
- --------------------------------------------------------------------------------
Global Cash Access LLC/
Global Cash Finance Corp.,
8.75% Sr. Sub. Nts., 3/15/12 2                         275,000           297,688
- --------------------------------------------------------------------------------
Helix 04 Ltd.,
7.96% Sec. Nts., 6/30/09 1                           1,000,000         1,003,950
- --------------------------------------------------------------------------------
Pemex Project Funding
Master Trust,
7.375% Unsec. Unsub. Nts.,
12/15/14                                               740,000           824,360
- --------------------------------------------------------------------------------
Redwood Capital V Ltd.,
6.71% Nts., 1/9/07 1,2                                 750,000           750,000
- --------------------------------------------------------------------------------
SBS Agro Finance BV,
10.25% Bonds, 7/21/00 2,3,4                            339,000                --
- --------------------------------------------------------------------------------
Universal City Florida:
7.20% Sr. Nts., 5/1/10 1,2                             130,000           135,850
8.375% Sr. Nts., 5/1/10 2                              130,000           135,525
                                                                 ---------------
                                                                       3,356,873

- --------------------------------------------------------------------------------
INSURANCE--0.0%
Arbor I Ltd., 17.99% Nts., 6/15/06 1,7                 500,000           518,756
- --------------------------------------------------------------------------------
REAL ESTATE--0.4%
American Casino &
Entertainment Properties LLC,
7.85% Sr. Sec. Nts., 2/1/12                            500,000           533,750
- --------------------------------------------------------------------------------
Felcor Lodging LP,
9% Sr. Nts., 6/1/11                                    425,000           483,438
- --------------------------------------------------------------------------------
Foundation RE Ltd.,
6.40% Nts., 11/24/08 1,2                               500,000           501,363
- --------------------------------------------------------------------------------
HMH Properties, Inc.,
7.875% Sr. Nts., Series B, 8/1/08                      202,000           208,565
- --------------------------------------------------------------------------------
Host Marriott LP,
9.50% Sr. Nts., 1/15/07                                400,000           440,000
- --------------------------------------------------------------------------------
MeriStar Hospitality Corp.,
9.125% Sr. Unsec. Nts., 1/15/11                      1,019,000         1,105,615
                                                                 ---------------
                                                                       3,272,731

- --------------------------------------------------------------------------------
HEALTH CARE--1.9%
- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--0.2% Fisher Scientific International, Inc.,
8.125% Sr. Sub. Nts., 5/1/12                           261,000           291,015
- --------------------------------------------------------------------------------
HMP Equity Holdings Corp.,
16.25% Sr. Disc. Nts., 5/15/08 8                       900,000           599,625
- --------------------------------------------------------------------------------
Inverness Medical
Innovations, Inc.,
8.75% Sr. Sub. Nts., 2/15/12 2                         350,000           367,500


            18 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES Continued
Sybron Dental Specialties, Inc.,
8.125% Sr. Sub. Nts., 6/15/12                    $     300,000   $       328,500
- --------------------------------------------------------------------------------
Universal Hospital Services, Inc.,
10.125% Sr. Unsec. Nts., 11/1/11                       300,000           313,500
                                                                 ---------------
                                                                       1,900,140

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--1.6%
Alderwoods Group, Inc.,
7.75% Sr. Nts., 9/15/12 7                              450,000           488,250
- --------------------------------------------------------------------------------
AmeriPath, Inc.,
10.50% Sr. Unsec. Sub. Nts., 4/1/13                    300,000           320,250
- --------------------------------------------------------------------------------
Beverly Enterprises, Inc.,
7.875% Sr. Sub. Nts., 6/15/14 2                        300,000           323,250
- --------------------------------------------------------------------------------
Community Health Systems, Inc.,
6.50% Sr. Sub. Nts., 12/15/12 7                        400,000           405,000
- --------------------------------------------------------------------------------
Extendicare Health Services, Inc.:
6.875% Sr. Sub. Nts., 5/1/14                           300,000           307,500
9.50% Sr. Unsec. Sub. Nts., 7/1/10                     300,000           337,500
- --------------------------------------------------------------------------------
Fresenius Medical Care
Capital Trust II,
7.875% Nts., 2/1/08                                    900,000           978,750
- --------------------------------------------------------------------------------
Fresenius Medical Care
Capital Trust III,
7.375% Nts., 2/1/08 [DEM]                               25,000            19,068
- --------------------------------------------------------------------------------
Fresenius Medical Care
Capital Trust IV,
7.875% Trust Preferred Nts.,
6/15/11                                                600,000           672,000
- --------------------------------------------------------------------------------
Genesis HealthCare Corp.,
8% Sr. Sub. Nts., 10/15/13                             200,000           218,000
- --------------------------------------------------------------------------------
HCA, Inc.:
6.30% Sr. Unsec. Nts., 10/1/12                       1,400,000         1,422,044
6.375% Nts., 1/15/15                                 1,350,000         1,357,954
- --------------------------------------------------------------------------------
HealthSouth Corp.:
7.625% Nts., 6/1/12                                  1,000,000         1,010,000
10.75% Sr. Unsec. Sub. Nts.,
10/1/08                                                 19,000            20,140
- --------------------------------------------------------------------------------
Magellan Health Services, Inc.,
9.375% Sr. Unsec. Nts.,
Series A, 11/15/08                                     653,675           714,957
- --------------------------------------------------------------------------------
Medquest, Inc.,
11.875% Sr. Unsec. Sub. Nts.,
Series B, 8/15/12 2                                    600,000           708,000
- --------------------------------------------------------------------------------
NDCHealth Corp.,
10.50% Sr. Unsec. Sub. Nts.,
12/1/12                                                250,000           270,000
- --------------------------------------------------------------------------------
PacifiCare Health Systems, Inc.,
10.75% Sr. Unsec. Unsub. Nts.,
6/1/09                                                 585,000           678,600
- --------------------------------------------------------------------------------
Quintiles Transnational Corp.,
10% Sr. Sub. Nts., 10/1/13 2                           300,000           337,500


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES Continued Tenet Healthcare Corp.:
6.375% Sr. Nts., 12/1/11                         $     744,000   $       693,780
7.375% Nts., 2/1/13                                     19,000            18,525
9.875% Sr. Nts., 7/1/14 7                              950,000         1,040,250
- --------------------------------------------------------------------------------
Triad Hospitals, Inc.:
7% Sr. Nts., 5/15/12                                   200,000           211,500
7% Sr. Sub. Nts., 11/15/13                             500,000           513,750
- --------------------------------------------------------------------------------
US Oncology, Inc.:
9% Sr. Nts., 8/15/12 7                                 300,000           336,750
10.75% Sr. Sub. Nts., 8/15/14 7                        300,000           348,750
                                                                 ---------------
                                                                      13,752,068

- --------------------------------------------------------------------------------
PHARMACEUTICALS--0.1%
Valeant Pharmaceuticals
International, Inc.,
7% Sr. Nts., 12/15/11                                  350,000           365,750
- --------------------------------------------------------------------------------
INDUSTRIALS--2.6%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--0.4%
Alliant Techsystems, Inc.,
8.50% Sr. Unsec. Sub. Nts., 5/15/11                    300,000           330,000
- --------------------------------------------------------------------------------
BE Aerospace, Inc.:
8.50% Sr. Unsec. Nts., 10/1/10                         200,000           221,000
8.875% Sr. Unsec. Sub. Nts., 5/1/11                    219,000           229,950
- --------------------------------------------------------------------------------
L-3 Communications Corp.:
5.875% Sr. Sub. Nts., 1/15/15 7                        700,000           701,750
7.625% Sr. Sub. Nts., 6/15/12                          300,000           330,750
- --------------------------------------------------------------------------------
Rexnord Corp.,
10.125% Sr. Unsec. Sub. Nts.,
12/15/12                                               350,000           397,250
- --------------------------------------------------------------------------------
TD Funding Corp.,
8.375% Sr. Sub. Nts., 7/15/11                          400,000           431,000
- --------------------------------------------------------------------------------
TRW Automotive, Inc.:
9.375% Sr. Nts., 2/15/13                               223,000           259,795
11% Sr. Sub. Nts., 2/15/13                             194,000           234,740
- --------------------------------------------------------------------------------
Vought Aircraft Industries, Inc.,
8% Sr. Nts., 7/15/11                                   200,000           195,500
                                                                 ---------------
                                                                       3,331,735

- --------------------------------------------------------------------------------
AIRLINES--0.1%
America West Airlines, Inc.,
10.75% Sr. Nts., 9/1/05                                450,000           451,125
- --------------------------------------------------------------------------------
ATA Holdings Corp.,
13% Sr. Unsec. Nts., 2/1/09 3,4                        735,000           422,625
                                                                 ---------------
                                                                         873,750

- --------------------------------------------------------------------------------
BUILDING PRODUCTS--0.1%
Associated Materials, Inc.,
9.75% Sr. Sub. Nts., 4/15/12                           200,000           224,500
- --------------------------------------------------------------------------------
Goodman Global
Holding Co., Inc.,
7.875% Sr. Sub. Nts., 12/15/12 7                       170,000           169,150


            19 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
BUILDING PRODUCTS Continued
Jacuzzi Brands, Inc.,
9.625% Sr. Sec. Nts., 7/1/10                     $     311,000   $       346,765
- --------------------------------------------------------------------------------
North America Energy
Partners, Inc.,
8.75% Sr. Unsec. Nts., 12/1/11                         150,000           153,750
                                                                 ---------------
                                                                         894,165

- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--0.7%
Allied Waste North America, Inc.:
7.875% Sr. Nts., 4/15/13                               400,000           412,000
8.50% Sr. Sub. Nts., 12/1/08                           900,000           958,500
8.875% Sr. Nts., Series B, 4/1/08                      800,000           860,000
9.25% Sr. Sec. Debs., Series B, 9/1/12                 950,000         1,033,125
- --------------------------------------------------------------------------------
Cenveo Corp.,
7.875% Sr. Sub. Nts., 12/1/13                        1,000,000           935,000
- --------------------------------------------------------------------------------
Corrections Corp. of America:
7.50% Sr. Nts., 5/1/11                                 200,000           214,750
9.875% Sr. Nts., 5/1/09                                300,000           334,500
- --------------------------------------------------------------------------------
Hydrochem Industrial
Services, Inc.,
10.375% Sr. Sub. Nts., 8/1/07 2                        150,000           151,875
- --------------------------------------------------------------------------------
Kindercare Learning
Centers, Inc.,
9.50% Sr. Sub. Nts., 2/15/09                           384,000           387,360
- --------------------------------------------------------------------------------
Mail-Well I Corp.,
9.625% Sr. Nts., 3/15/12 2                             400,000           441,000
- --------------------------------------------------------------------------------
Protection One, Inc./
Protection One Alarm
Monitoring, Inc.,
7.375% Sr. Unsec. Nts., 8/15/05                        400,000           406,000
- --------------------------------------------------------------------------------
Synagro Technologies, Inc.,
9.50% Sr. Sub. Nts., 4/1/09                            200,000           219,000
                                                                 ---------------
                                                                       6,353,110

- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--0.1%
Integrated Electrical Services, Inc.,
9.375% Sr. Sub. Nts.,
Series C, 2/1/09                                       405,000           382,725
- --------------------------------------------------------------------------------
URS Corp.:
11.50% Sr. Unsec. Nts., 9/15/09                         97,000           112,035
12.25% Sr. Sub. Nts.,
Series B, 5/1/09 2                                      19,000            20,330
                                                                 ---------------
                                                                         515,090

- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.2%
Belden & Blake Corp.,
8.75% Sr. Sec. Nts., 7/15/12 2                         325,000           331,500
- --------------------------------------------------------------------------------
Dayton Superior Corp.,
13% Sr. Unsec. Sub. Nts., 6/15/09                      200,000           209,000


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT Continued
General Cable Corp.,
9.50% Sr. Nts., 11/15/10                         $     200,000   $       227,000
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co.,
7% Sr. Unsec. Debs., 10/15/28                          500,000           503,750
                                                                 ---------------
                                                                       1,271,250

- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.0%
Great Lakes Dredge & Dock Co.,
7.75% Sr. Unsec. Sub. Nts.,
12/15/13                                               120,000           109,800
- --------------------------------------------------------------------------------
MACHINERY--0.5%
AGCO Corp.,
9.50% Sr. Unsec. Nts., 5/1/08                          800,000           856,000
- --------------------------------------------------------------------------------
Douglas Dynamics LLC,
7.75% Sr. Nts., 1/15/12 7                              300,000           305,625
- --------------------------------------------------------------------------------
Dresser-Rand Group, Inc.,
7.375% Sr. Sub. Nts., 11/1/14 7                        100,000           102,500
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The),
10.50% Sr. Sub. Nts., 8/1/12                           500,000           577,500
- --------------------------------------------------------------------------------
Milacron Escrow Corp.,
11.50% Sr. Sec. Nts., 5/15/11 2                        600,000           639,000
- --------------------------------------------------------------------------------
Navistar International Corp.,
7.50% Sr. Nts., 6/15/11                                400,000           431,000
- --------------------------------------------------------------------------------
NMHG Holding Co.,
10% Sr. Nts., 5/15/09                                  300,000           333,000
- --------------------------------------------------------------------------------
SPX Corp., 7.50% Sr. Nts., 1/1/13                      600,000           654,000
- --------------------------------------------------------------------------------
Terex Corp., 9.25% Sr. Unsec.
Sub. Nts., 7/15/11                                     400,000           451,000
- --------------------------------------------------------------------------------
Trinity Industries, Inc.,
6.50% Sr. Nts., 3/15/14                                300,000           301,500
                                                                 ---------------
                                                                       4,651,125

- --------------------------------------------------------------------------------
MARINE--0.1%
CP Ships Ltd.,
10.375% Sr. Nts., 7/15/12                              600,000           695,250
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc.,
12% Sr. Sec. Nts., 7/15/05 2,3,4                       250,000             6,025
- --------------------------------------------------------------------------------
Navigator Gas Transport plc,
10.50% First Priority Ship
Mtg. Nts., 6/30/07 2,3,4                               175,000           132,344
                                                                 ---------------
                                                                         833,619

- --------------------------------------------------------------------------------
ROAD & RAIL--0.2%
Kansas City Southern
Railway Co. (The),
7.50% Sr. Nts., 6/15/09                                400,000           422,000
- --------------------------------------------------------------------------------
Stena AB:
7% Sr. Nts., 12/1/16 7                                 800,000           796,000
7.50% Sr. Unsec. Nts., 11/1/13                         387,000           407,318
9.625% Sr. Nts., 12/1/12                               250,000           283,750
                                                                 ---------------
                                                                       1,909,068


            20 | OPPENHEIMER STRATEGIC BOND FUND/ VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--0.1% United Rentals, Inc.,
7% Sr. Sub. Nts., 2/15/14                        $     900,000   $       846,000
- --------------------------------------------------------------------------------
TRANSPORTATION INFRASTRUCTURE--0.1% Horizon Lines LLC, 9% Nts.,
11/1/12 7                                              300,000           324,000
- --------------------------------------------------------------------------------
Worldspan LP/
Worldspan Financial Corp.,
9.625% Sr. Nts., 6/15/11                               400,000           400,000
                                                                 ---------------
                                                                         724,000

- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--0.9%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--0.1%
Lucent Technologies, Inc.,
6.45% Unsec. Debs., 3/15/29                            500,000           455,000
- --------------------------------------------------------------------------------
Orion Network Systems, Inc.,
12.50% Sr. Unsub. Disc. Nts.,
1/15/07 2,3,4                                          675,000           354,375
                                                                 ---------------
                                                                         809,375

- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--0.0%
Seagate Technology
Hdd Holdings,
8% Sr. Nts., 5/15/09                                   200,000           217,000
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--0.3% Flextronics International Ltd.,
6.25% Sr. Sub. Nts., 11/15/14 7                      1,100,000         1,094,500
- --------------------------------------------------------------------------------
Ingram Micro, Inc., 9.875% Sr.
Unsec. Sub. Nts., 8/15/08                              700,000           764,750
- --------------------------------------------------------------------------------
LCE Acquisition Corp.,
9% Sr. Sub. Nts., 8/1/14 7                             425,000           462,188
- --------------------------------------------------------------------------------
Sensus Metering System, Inc.,
8.625% Sr. Unsec. Sub. Nts., 12/15/13                  450,000           463,500
                                                                 ---------------
                                                                       2,784,938

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.0% Exodus Communications, Inc.,
10.75% Sr. Nts., 12/15/09 2,3,4 [EUR]                  338,620             4,603
- --------------------------------------------------------------------------------
Globix Corp., 11% Sr. Nts., 5/1/08 14                   42,888            39,671
- --------------------------------------------------------------------------------
NorthPoint Communications
Group, Inc.,
12.875% Nts., 2/15/10 2,3,4                            200,173                --
- --------------------------------------------------------------------------------
PSINet, Inc.,
10.50% Sr. Unsec. Nts.,
12/1/06 2,3,4 [EUR]                                    100,000             5,437
                                                                 ---------------
                                                                          49,711


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
IT SERVICES--0.1%
Iron Mountain, Inc.,
7.75% Sr. Sub. Nts., 1/15/15                     $     400,000   $       408,000
- --------------------------------------------------------------------------------
Titan Corp. (The),
8% Sr. Sub. Nts., 5/15/11                              100,000           107,000
                                                                 ---------------
                                                                         515,000

- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--0.4%
AMI Semiconductor, Inc.,
10.75% Sr. Unsec. Sub. Nts., 2/1/13                    389,000           459,020
- --------------------------------------------------------------------------------
Amkor Technology, Inc.:
7.75% Sr. Nts., 5/15/13                                200,000           189,000
9.25% Sr. Unsec. Sub. Nts., 2/15/08                    250,000           256,875
- --------------------------------------------------------------------------------
Freescale Semiconductor, Inc.,
7.125% Sr. Unsec. Nts., 7/15/14                        600,000           654,000
- --------------------------------------------------------------------------------
Huntsman International LLC,
7.375% Sr. Sub. Nts., 1/1/15 7                       1,100,000         1,108,250
- --------------------------------------------------------------------------------
MagnaChip Semiconductor Ltd.,
8% Sr. Sub. Nts., 12/15/14 7                            87,000            91,133
- --------------------------------------------------------------------------------
Micron Technology, Inc.,
6.50% Sub. Nts., 9/30/05                             1,000,000           995,000
                                                                 ---------------
                                                                       3,753,278

- --------------------------------------------------------------------------------
MATERIALS--4.1%
- --------------------------------------------------------------------------------
CHEMICALS--1.3%
Compass Minerals Group, Inc.,
10% Sr. Sub. Nts., 8/15/11                             450,000           508,500
- --------------------------------------------------------------------------------
Crompton Corp.,
9.875% Sr. Nts., 8/1/12 7                              350,000           402,500
- --------------------------------------------------------------------------------
Equistar Chemicals LP/
Equistar Funding Corp.:
8.75% Sr. Unsec. Nts., 2/15/09                         400,000           450,000
10.125% Sr. Unsec. Nts., 9/1/08                         19,000            21,993
10.625% Sr. Unsec. Nts., 5/1/11                        900,000         1,048,500
- --------------------------------------------------------------------------------
Huntsman Co. LLC:
11.625% Sr. Unsec. Nts., 10/15/10                       19,000            22,563
11.75% Sr. Nts., 7/15/12 7                             700,000           831,250
- --------------------------------------------------------------------------------
Huntsman Corp./
ICI Chemical Co. plc:
13.09% Sr. Unsec. Disc. Nts.,
12/31/09 8                                             600,000           339,000
10.125% Sr. Unsec. Sub. Nts.,
7/1/09 [EUR]                                           124,000           177,396
10.125% Sr. Unsec. Sub. Nts.,
7/1/09                                                 853,000           902,048
- --------------------------------------------------------------------------------
Huntsman International LLC,
9.875% Sr. Nts., 3/1/09                                850,000           937,125
- --------------------------------------------------------------------------------
IMC Global, Inc.,
10.875% Sr. Unsec. Nts., 8/1/13 2                       19,000            23,845
- --------------------------------------------------------------------------------
Innophos, Inc.,
8.875% Sr. Sub. Nts., 8/15/14 2                        400,000           434,000


            21 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
CHEMICALS Continued
ISP Holdings, Inc.,
10.625% Sr. Sec. Nts., 12/15/09                  $     200,000   $       222,500
- --------------------------------------------------------------------------------
KI Holdings, Inc., 0%/9.875%
Sr. Disc. Nts., 11/15/14 7,13                          350,000           225,750
- --------------------------------------------------------------------------------
Lyondell Chemical Co.:
9.50% Sec. Nts., 12/15/08                               19,000            20,710
9.625% Sr. Sec. Nts.,
Series A, 5/1/07                                       200,000           221,000
9.875% Sec. Nts., Series B, 5/1/07                     980,000         1,031,450
- --------------------------------------------------------------------------------
Millennium America, Inc.,
9.25% Sr. Unsec. Sub. Nts., 6/15/08                    100,000           114,250
- --------------------------------------------------------------------------------
PCI Chemicals Canada,
10% Sr. Sec. Nts., 12/31/08                            113,061           120,410
- --------------------------------------------------------------------------------
Pioneer Cos., Inc.,
6.05% Sr. Sec. Nts., 12/31/06 1                         35,804            37,773
- --------------------------------------------------------------------------------
PolyOne Corp.:
8.875% Sr. Unsec. Nts., 5/1/12                       1,200,000         1,311,000
10.625% Sr. Unsec. Nts., 5/15/10                        19,000            21,470
- --------------------------------------------------------------------------------
Resolution Performance
Products LLC:
8% Sr. Sec. Nts., 12/15/09                             250,000           270,000
13.50% Sr. Unsec. Sub. Nts., 11/15/10                  100,000           109,250
- --------------------------------------------------------------------------------
Rhodia SA,
10.25% Sr. Unsec. Nts., 6/1/10                         550,000           621,500
- --------------------------------------------------------------------------------
Rockwood Specialties Group, Inc.,
7.50% Sr. Sub. Nts., 11/15/14 7                        200,000           208,500
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc.,
10% Sr. Sec. Nts., 12/19/07 14                         170,473           171,325
- --------------------------------------------------------------------------------
Westlake Chemical Corp.,
8.75% Sr. Nts., 7/15/11                                260,000           295,100
                                                                 ---------------
                                                                      11,100,708

- --------------------------------------------------------------------------------
CONSTRUCTION MATERIALS--0.0%
Texas Industries, Inc.,
10.25% Sr. Unsec. Nts., 6/15/11                        400,000           470,000
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING--1.1% Crown Euro Holdings SA:
9.50% Sr. Sec. Nts., 3/1/11                            500,000           572,500
10.875% Sr. Sec. Nts., 3/1/13                          200,000           237,500
- --------------------------------------------------------------------------------
Graham Packaging Co., Inc.:
8.50% Sr. Nts., 10/15/12 7                             200,000           211,000
9.875% Sub. Nts., 10/15/14 7                           300,000           321,750
- --------------------------------------------------------------------------------
Graphic Packaging
International Corp.:
8.50% Sr. Nts., 8/15/11                                500,000           548,750
9.50% Sr. Sub. Nts., 8/15/13                           350,000           399,875
- --------------------------------------------------------------------------------
Jefferson Smurfit Corp.:
7.50% Sr. Unsec. Unsub. Nts., 6/1/13                   300,000           321,750
8.25% Sr. Unsec. Nts., 10/1/12                         250,000           273,750


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING Continued
MDP Acquisitions plc,
9.625% Sr. Nts., 10/1/12                         $     400,000   $       448,000
- --------------------------------------------------------------------------------
Owens-Brockway
Glass Container, Inc.:
7.75% Sr. Sec. Nts., 5/15/11                           450,000           489,375
8.25% Sr. Unsec. Nts., 5/15/13                         419,000           462,995
8.75% Sr. Sec. Nts., 11/15/12                        1,000,000         1,132,500
8.875% Sr. Sec. Nts., 2/15/09                          200,000           218,250
- --------------------------------------------------------------------------------
Pliant Corp., 0%/11.125%
Sr. Sec. Disc. Nts., 6/15/09 13                        400,000           371,500
- --------------------------------------------------------------------------------
Solo Cup Co.,
8.50% Sr. Sub. Nts., 2/15/14                           500,000           522,500
- --------------------------------------------------------------------------------
Stone Container Corp.:
8.375% Sr. Nts., 7/1/12                                850,000           930,750
9.25% Sr. Unsec. Nts., 2/1/08                          200,000           222,000
9.75% Sr. Unsec. Nts., 2/1/11                          600,000           660,000
- --------------------------------------------------------------------------------
Stone Container Finance Co.
of Canada II,
7.375% Sr. Unsec. Nts., 7/15/14                        300,000           321,000
- --------------------------------------------------------------------------------
TriMas Corp., 9.875% Sr.
Unsec. Sub. Nts., 6/15/12 2                            500,000           532,500
                                                                 ---------------
                                                                       9,198,245

- --------------------------------------------------------------------------------
METALS & MINING--1.1%
AK Steel Corp.:
7.75% Sr. Unsec. Nts., 6/15/12                         219,000           226,665
7.875% Sr. Unsec. Nts., 2/15/09                        500,000           511,875
- --------------------------------------------------------------------------------
Arch Western Finance LLC,
6.75% Sr. Nts., 7/1/13                                 400,000           415,000
- --------------------------------------------------------------------------------
Asia Aluminum Holdings Ltd.,
8% Sr. Sec. Nts., 12/23/11 2                           925,000           938,875
- --------------------------------------------------------------------------------
California Steel Industries, Inc.,
6.125% Sr. Nts., 3/15/14                               400,000           399,000
- --------------------------------------------------------------------------------
Century Aluminum Co.,
7.50% Sr. Nts., 8/15/14 7                              600,000           642,000
- --------------------------------------------------------------------------------
Foundation PA Coal Co.,
7.25% Sr. Nts., 8/1/14 7                               250,000           267,500
- --------------------------------------------------------------------------------
IMCO Recycling, Inc.,
10.375% Sr. Sec. Nts., 10/15/10                        300,000           342,000
- --------------------------------------------------------------------------------
International Steel Group, Inc.,
6.50% Sr. Nts., 4/15/14                                200,000           215,500
- --------------------------------------------------------------------------------
International Utility
Structures, Inc.,
13% Unsec. Sub. Nts., 2/1/08 2,3,4                      71,000                --
- --------------------------------------------------------------------------------
Ispat Inland ULC,
9.75% Sr. Sec. Nts., 4/1/14                            585,000           725,400
- --------------------------------------------------------------------------------
Jorgensen (Earle M.) Co.,
9.75% Sr. Sec. Nts., 6/1/12                            500,000           565,000


            22 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
METALS & MINING Continued
Kaiser Aluminum &
Chemical Corp.,
10.875% Sr. Nts.,
Series B, 10/15/06 3,4                           $     500,000   $       443,750
- --------------------------------------------------------------------------------
Koppers Industry, Inc.,
9.875% Sr. Sec. Nts., 10/15/13                         300,000           343,500
- --------------------------------------------------------------------------------
Massey Energy Co.,
6.625% Sr. Nts., 11/15/10                              200,000           210,000
- --------------------------------------------------------------------------------
Metallurg, Inc.,
11% Sr. Nts., 12/1/07                                  500,000           437,500
- --------------------------------------------------------------------------------
Oregon Steel Mills, Inc.,
10% Sr. Nts., 7/15/09                                  400,000           447,000
- --------------------------------------------------------------------------------
Peabody Energy Corp.,
6.875% Sr. Unsec. Nts.,
Series B, 3/15/13                                      400,000           435,000
- --------------------------------------------------------------------------------
Steel Dynamics, Inc.,
9.50% Sr. Nts., 3/15/09                                200,000           220,000
- --------------------------------------------------------------------------------
UCAR Finance, Inc.,
10.25% Sr. Nts., 2/15/12 2                             300,000           344,250
- --------------------------------------------------------------------------------
United States Steel Corp.:
9.75% Sr. Nts., 5/15/10                                336,000           384,720
10.75% Sr. Nts., 8/1/08                                519,000           613,718
                                                                 ---------------
                                                                       9,128,253

- --------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--0.6%
Abitibi-Consolidated, Inc.,
8.55% Nts., 8/1/10                                     200,000           217,750
- --------------------------------------------------------------------------------
Appleton Papers, Inc.,
8.125% Sr. Nts., 6/15/11                               300,000           324,750
- --------------------------------------------------------------------------------
Buckeye Technologies, Inc.,
8.50% Sr. Nts., 10/1/13                                100,000           109,000
- --------------------------------------------------------------------------------
Fort James Corp.,
6.875% Sr. Nts., 9/15/07                               500,000           533,750
- --------------------------------------------------------------------------------
Georgia-Pacific Corp.:
8.125% Sr. Unsec. Nts., 5/15/11                      1,050,000         1,212,750
9.375% Sr. Unsec. Nts., 2/1/13                         800,000           936,000
- --------------------------------------------------------------------------------
Inland Fiber Group LLC,
9.625% Sr. Unsec. Nts., 11/15/07 2,3,4                 300,000           136,500
- --------------------------------------------------------------------------------
Norske Skog Canada Ltd.,
7.375% Sr. Unsec. Nts., 3/1/14                         300,000           314,250
- --------------------------------------------------------------------------------
Riverside Forest Products Ltd.,
7.875% Sr. Unsec. Sub. Nts., 3/1/14                    300,000           331,500
- --------------------------------------------------------------------------------
Tekni-Plex, Inc.:
8.75% Sr. Sec. Nts., 11/15/13 7                        669,000           669,000
12.75% Sr. Unsec. Sub. Nts.,
Series B, 6/15/10                                      200,000           191,000
- --------------------------------------------------------------------------------
Tembec Industries, Inc.,
8.50% Sr. Unsec. Nts., 2/1/11                           19,000            19,190
- --------------------------------------------------------------------------------
Western Forest Products, Inc.,
15% Sec. Nts., 7/28/09 7,14                            187,000           211,778
                                                                 ---------------
                                                                       5,207,218


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--3.2%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--1.3% American Tower Corp.:
7.125% Sr. Unsec. Nts., 10/15/12 7               $     250,000   $       256,875
9.375% Sr. Nts., 2/1/09 5                              133,000           141,313
- --------------------------------------------------------------------------------
Citizens Communications Co.,
6.25% Sr. Nts., 1/15/13                                700,000           708,750
- --------------------------------------------------------------------------------
Crown Castle International Corp.,
7.50% Sr. Nts., 12/1/13                                400,000           432,000
- --------------------------------------------------------------------------------
MCI, Inc.:
6.908% Sr. Unsec. Nts., 5/1/07 1                       468,000           480,285
7.688% Sr. Unsec. Nts., 5/1/09 1                     1,150,000         1,193,125
- --------------------------------------------------------------------------------
PSINet, Inc., 11% Sr. Nts., 8/1/09 2,3,4               265,814             3,987
- --------------------------------------------------------------------------------
Qwest Capital Funding, Inc.,
7.90% Unsec. Nts., 8/15/10                             819,000           831,285
- --------------------------------------------------------------------------------
Qwest Communications
International, Inc.,
7.25% Sr. Nts., 2/15/11 7                              300,000           309,000
- --------------------------------------------------------------------------------
Qwest Corp.,
9.125% Nts., 3/15/12 7                                 800,000           928,000
- --------------------------------------------------------------------------------
Qwest Services Corp.:
14% Nts., 12/15/10 1,7                               2,700,000         3,260,250
14.50% Nts., 12/15/14 7                              1,000,000         1,270,000
- --------------------------------------------------------------------------------
Teligent, Inc.,
11.50% Sr. Nts., 12/1/07 2,3,4                         500,000                --
- --------------------------------------------------------------------------------
Telus Corp., 7.50% Nts., 6/1/07                        790,000           858,810
- --------------------------------------------------------------------------------
Time Warner Telecom LLC/
Time Warner Telecom, Inc.,
9.75% Sr. Nts., 7/15/08                                300,000           305,250
- --------------------------------------------------------------------------------
Winstar Communications, Inc.,
12.75% Sr. Nts., 4/15/10 2,3,4                         250,000                --
                                                                 ---------------
                                                                      10,978,930

- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--1.9% Alamosa Delaware, Inc.:
8.50% Sr. Nts., 1/31/12                                400,000           439,000
11% Sr. Unsec. Nts., 7/31/10                            19,000            22,468
12.50% Sr. Unsec. Nts., 2/1/11                          50,000            56,750
- --------------------------------------------------------------------------------
American Cellular Corp.,
10% Sr. Nts., Series B, 8/1/11                         575,000           495,938
- --------------------------------------------------------------------------------
American Tower Corp.,
7.50% Sr. Nts., 5/1/12                                 400,000           422,000
- --------------------------------------------------------------------------------
American Tower Escrow Corp.,
12.25% Sr. Sub. Disc. Nts., 8/1/08 8                   800,000           602,000
- --------------------------------------------------------------------------------
AT&T Corp.:
9.05% Sr. Unsec. Nts., 11/15/11 1                    1,000,000         1,156,250
9.75% Sr. Nts., 11/15/31 1                             500,000           599,375
- --------------------------------------------------------------------------------
CellNet Data Systems, Inc.,
Sr. Unsec. Disc. Nts., 10/1/07 2,3,4                   400,000                --


            23 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES Continued
Centennial Cellular
Operating Co. LLC/Centennial
Communications Corp.,
10.125% Sr. Nts., 6/15/13                        $   1,050,000   $     1,183,875
- --------------------------------------------------------------------------------
Crown Castle International Corp.,
10.75% Sr. Nts., 8/1/11                              1,000,000         1,090,000
- --------------------------------------------------------------------------------
Dobson Cellular Systems,
8.375% Sec. Nts., 11/1/11 7                            130,000           134,875
- --------------------------------------------------------------------------------
Dobson Communications Corp.:
8.875% Sr. Nts., 10/1/13                               219,000           154,943
10.875% Sr. Unsec. Nts., 7/1/10                        600,000           468,000
- --------------------------------------------------------------------------------
IWO Escrow Co.,
Sr. Sec. Nts., 1/15/12 1,5,7                           110,000           111,375
- --------------------------------------------------------------------------------
Nextel Communications, Inc.,
7.375% Sr. Nts., 8/1/15                              3,080,000         3,403,400
- --------------------------------------------------------------------------------
Nextel Partners, Inc.,
12.50% Sr. Nts., 11/15/09                              342,000           389,025
- --------------------------------------------------------------------------------
Rogers Wireless
Communications, Inc.:
7.50% Sr. Sec. Nts., 3/15/15 7                         450,000           477,000
8% Sr. Sub. Nts., 12/15/12 7                           400,000           425,000
- --------------------------------------------------------------------------------
Rural Cellular Corp.:
8.25% Sr. Sec. Nts., 3/15/12                           275,000           292,188
9.625% Sr. Sub. Nts.,
Series B, 5/15/08                                      500,000           477,500
9.75% Sr. Sub. Nts., 1/15/10                           519,000           472,290
9.875% Sr. Nts., 2/1/10                                300,000           306,750
- --------------------------------------------------------------------------------
SBA Communications Corp.,
8.50% Sr. Nts., 12/1/12 7                              550,000           563,750
- --------------------------------------------------------------------------------
SBA Telecommunications, Inc./
SBA Communications Corp.,
0%/9.75% Sr. Disc. Nts., 12/15/11 13                 1,169,000           990,728
- --------------------------------------------------------------------------------
Triton PCS, Inc.,
8.50% Sr. Unsec. Nts., 6/1/13                          550,000           533,500
- --------------------------------------------------------------------------------
UbiquiTel Operating Co.,
9.875% Sr. Nts., 3/1/11                                600,000           676,500
- --------------------------------------------------------------------------------
US Unwired, Inc.,
10% Sr. Sec. Nts., 6/15/12                             250,000           283,125
- --------------------------------------------------------------------------------
Western Wireless Corp.,
9.25% Sr. Unsec. Nts., 7/15/13                         469,000           512,383
                                                                 ---------------
                                                                      16,739,988

- --------------------------------------------------------------------------------
UTILITIES--2.0%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.3%
AES Corp. (The),
8.75% Sr. Sec. Nts., 5/15/13 7                         700,000           798,875
- --------------------------------------------------------------------------------
Caithness Coso Funding Corp.,
9.05% Sr. Sec. Nts.,
Series B, 12/15/09                                     293,438           324,249
- --------------------------------------------------------------------------------
Calpine Corp.,
7.625% Sr. Nts., 4/15/06                               200,000           197,500


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES Continued
CenterPoint Energy, Inc.,
7.25% Sr. Nts., Series B, 9/1/10                 $     200,000   $       223,330
- --------------------------------------------------------------------------------
CITGO Trustees Cayman Ltd.,
8.50% Nts., 12/21/14 2                                 610,000           611,525
- --------------------------------------------------------------------------------
CMS Energy Corp.:
7.50% Sr. Nts., 1/15/09                                 19,000            20,330
7.75% Sr. Nts., 8/1/10                                 200,000           219,750
8.50% Sr. Nts., 4/15/11                                250,000           285,313
9.875% Sr. Unsec. Nts., 10/15/07                       900,000         1,010,250
- --------------------------------------------------------------------------------
CMS Energy X-TRAS
Pass-Through Trust I,
7% Sr. Unsec. Pass-Through
Certificates, 1/15/05                                  300,000           300,000
- --------------------------------------------------------------------------------
Funding Corp./
Beaver Valley Funding Corp.,
9% Second Lease
Obligation Bonds, 6/1/17                               199,000           235,818
- --------------------------------------------------------------------------------
Midwest Generation LLC,
8.75% Sr. Sec. Nts., 5/1/34                          1,850,000         2,109,000
- --------------------------------------------------------------------------------
Mirant Americas Generation LLC,
7.625% Sr. Unsec. Nts., 5/1/06 3,4                     200,000           216,000
- --------------------------------------------------------------------------------
MSW Energy Holdings II LLC/
MSW Energy Finance Co. II, Inc.,
7.375% Sr. Sec. Nts.,
Series B, 9/1/10                                       350,000           369,250
- --------------------------------------------------------------------------------
MSW Energy Holdings LLC/
MSW Energy Finance Co., Inc.,
8.50% Sr. Sec. Nts., 9/1/10                            200,000           220,000
- --------------------------------------------------------------------------------
NRG Energy, Inc.,
8% Sr. Sec. Nts., 12/15/13 7                         1,100,000         1,204,500
- --------------------------------------------------------------------------------
Reliant Energy, Inc.,
6.75% Sr. Sec. Nts., 12/15/14                          400,000           399,500
- --------------------------------------------------------------------------------
Reliant Resources, Inc.:
9.25% Sr. Sec. Nts., 7/15/10                           669,000           749,280
9.50% Sr. Sec. Nts., 7/15/13                           900,000         1,027,125
- --------------------------------------------------------------------------------
Teco Energy, Inc.,
7.20% Unsec. Unsub. Nts., 5/1/11                       600,000           660,000
- --------------------------------------------------------------------------------
Texas Genco LLC,
6.875% Sr. Nts., 12/15/14 7                            550,000           571,313
                                                                 ---------------
                                                                      11,752,908

- --------------------------------------------------------------------------------
GAS UTILITIES--0.1%
AmeriGas Partners LP/
AmeriGas Eagle Finance Corp.,
8.875% Sr. Unsec. Nts.,
Series B, 5/20/11                                      500,000           547,500
- --------------------------------------------------------------------------------
SEMCO Energy, Inc.,
7.125% Sr. Nts., 5/15/08                               150,000           161,291
                                                                 ---------------
                                                                         708,791


            24 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER--0.6%
AES Red Oak LLC,
8.54% Sr. Sec. Bonds,
Series A, 11/30/19                               $     562,854   $       634,617
- --------------------------------------------------------------------------------
Consumers Energy Co.,
7.375% Nts., 9/15/23                                   250,000           258,610
- --------------------------------------------------------------------------------
Dynegy Holdings, Inc.:
6.875% Sr. Unsec. Unsub. Nts., 4/1/11                  850,000           822,375
8.75% Sr. Nts., 2/15/12                              1,669,000         1,756,623
10.125% Sr. Sec. Nts., 7/15/13 7                       800,000           920,000
- --------------------------------------------------------------------------------
Mirant Mid-Atlantic LLC,
8.625% Sec. Pass-Through
Certificates, Series A, 6/30/12                        429,280           476,770
- --------------------------------------------------------------------------------
NorthWestern Corp.,
5.875% Sr. Sec. Nts., 11/1/14 7                         90,000            92,517
                                                                 ---------------
                                                                       4,961,512
                                                                 ---------------
Total Corporate Bonds and
Notes (Cost $228,184,438)                                            240,328,675

                                                        SHARES
- --------------------------------------------------------------------------------
PREFERRED STOCKS--0.3%
- --------------------------------------------------------------------------------
AmeriKing, Inc.,
13% Cum. Sr. Exchangeable,
Non-Vtg. 2,4,14                                          4,253                --
- --------------------------------------------------------------------------------
Doane Pet Care Co.,
14.25% Jr. Sub. Exchange Debs.,
Non-Vtg. 2,4                                             5,000           261,250
- --------------------------------------------------------------------------------
Dobson Communications Corp.,
6% Cv., Series F (converts into
Dobson Communications Corp.,
Cl. A common stock), Non-Vtg. 7                            550            38,549
- --------------------------------------------------------------------------------
e.spire Communications, Inc.,
12.75% Jr. Redeemable, Non-Vtg. 2,4,14                     216                22
- --------------------------------------------------------------------------------
Eagle-Picher Holdings, Inc.,
11.75% Cum. Exchangeable,
Series B, Non-Vtg. 2,4                                   5,000           436,250
- --------------------------------------------------------------------------------
ICG Holdings, Inc.,
14.25% Exchangeable, Non-Vtg. 2,4,14                       151                --
- --------------------------------------------------------------------------------
Paxson Communications Corp.:
14.25% Cum. Jr. Exchangeable, Non-Vtg. 2,14                 43           317,125
14.25% Cum. Jr. Exchangeable, Non-Vtg. 2,4,14                1             5,790
- --------------------------------------------------------------------------------
Pennsylvania Real Estate
Investment Trust, 11%                                    2,000           121,000
- --------------------------------------------------------------------------------
PTV, Inc., 10% Cum.,
Series A, Non-Vtg                                            7                24
- --------------------------------------------------------------------------------
Rural Cellular Corp.,
11.375% Cum.,
Series B, Non-Vtg. 2,4,14                                  630           489,825


                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
PREFERRED STOCKS Continued
Sovereign Real Estate Investment
Trust, 12% Non-Cum., Series A 2                          4,600   $       698,050
                                                                 ---------------
Total Preferred
Stocks (Cost $2,471,559)                                               2,367,885

- --------------------------------------------------------------------------------
COMMON STOCKS--2.8%
- --------------------------------------------------------------------------------
AboveNet, Inc. 4                                            72             2,304
- --------------------------------------------------------------------------------
ACE Ltd.                                                 4,100           175,275
- --------------------------------------------------------------------------------
Aegis Group plc                                         84,740           175,708
- --------------------------------------------------------------------------------
Aetna, Inc.                                              1,400           174,650
- --------------------------------------------------------------------------------
All Nippon Airways Co. Ltd.                             48,000           167,229
- --------------------------------------------------------------------------------
Allstate Corp.                                           3,300           170,676
- --------------------------------------------------------------------------------
Anadarko Petroleum Corp.                                 2,510           162,673
- --------------------------------------------------------------------------------
Apache Corp.                                             3,300           166,881
- --------------------------------------------------------------------------------
Apple Computer, Inc. 4                                   2,700           173,880
- --------------------------------------------------------------------------------
Arriva plc                                              17,920           185,785
- --------------------------------------------------------------------------------
Ashland, Inc.                                            2,900           169,302
- --------------------------------------------------------------------------------
Autodesk, Inc.                                           5,000           189,750
- --------------------------------------------------------------------------------
BAE Systems plc                                         35,850           158,650
- --------------------------------------------------------------------------------
Bear Stearns Cos., Inc. (The)                            1,600           163,696
- --------------------------------------------------------------------------------
Beverly Hills Bancorp, Inc.                              6,273            63,357
- --------------------------------------------------------------------------------
Black & Decker Corp.                                     2,000           176,660
- --------------------------------------------------------------------------------
Broadwing Corp.                                            688             6,268
- --------------------------------------------------------------------------------
Burlington Resources, Inc.                               3,900           169,650
- --------------------------------------------------------------------------------
Cebridge Connections
Holding LLC 4                                              529                --
- --------------------------------------------------------------------------------
Celesio AG                                               2,194           178,037
- --------------------------------------------------------------------------------
Centex Corp.                                             3,200           190,656
- --------------------------------------------------------------------------------
Charles River Laboratories
International, Inc. 4                                    2,660           122,387
- --------------------------------------------------------------------------------
Chesapeake Energy Corp.                                    416             6,864
- --------------------------------------------------------------------------------
ChevronTexaco Corp.                                      3,200           168,032
- --------------------------------------------------------------------------------
Chubu Electric Power Co., Inc.                           7,300           175,251
- --------------------------------------------------------------------------------
CIGNA Corp.                                              2,200           179,454
- --------------------------------------------------------------------------------
CNP Assurances SA                                        2,480           177,649
- --------------------------------------------------------------------------------
ConocoPhillips                                           1,900           164,977
- --------------------------------------------------------------------------------
Conseco, Inc. 4                                         13,986           279,021
- --------------------------------------------------------------------------------
Continental AG                                           2,750           174,749
- --------------------------------------------------------------------------------
Corus Group plc 4                                      161,310           156,398
- --------------------------------------------------------------------------------
Countrywide Financial Corp.                              4,900           181,349
- --------------------------------------------------------------------------------
Covad Communications
Group, Inc. 4                                           16,528            35,535
- --------------------------------------------------------------------------------
Criimi MAE, Inc. 4                                      71,447         1,150,297
- --------------------------------------------------------------------------------
Crunch Equity Holdings, Cl. A 2,4                          120           156,133
- --------------------------------------------------------------------------------
Cummins, Inc.                                            2,100           175,959


            25 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS Continued
- --------------------------------------------------------------------------------
Dainippon Ink & Chemicals, Inc.                         74,000   $       170,430
- --------------------------------------------------------------------------------
Devon Energy Corp.                                       4,200           163,464
- --------------------------------------------------------------------------------
Dillard's, Inc., Cl. A                                   6,400           171,968
- --------------------------------------------------------------------------------
Dobson Communications
Corp., Cl. A 4                                          24,300            41,796
- --------------------------------------------------------------------------------
E.ON AG                                                  1,992           181,898
- --------------------------------------------------------------------------------
Energy Select Sector SPDR Fund                          18,200           658,840
- --------------------------------------------------------------------------------
EOG Resources, Inc.                                      2,300           164,128
- --------------------------------------------------------------------------------
Equinix, Inc. 4                                          1,887            80,650
- --------------------------------------------------------------------------------
Financial Select Sector SPDR Fund                       21,600           659,448
- --------------------------------------------------------------------------------
Freddie Mac                                              2,400           176,880
- --------------------------------------------------------------------------------
Friends Provident plc                                   54,940           162,438
- --------------------------------------------------------------------------------
General Motors Corp.                                     4,400           176,264
- --------------------------------------------------------------------------------
Geotek Communications, Inc.,
Series B, Escrow Shares 2,4,15                             210                --
- --------------------------------------------------------------------------------
Globix Corp. 4                                           6,880            24,768
- --------------------------------------------------------------------------------
Heidelberger Zement AG                                   2,960           179,362
- --------------------------------------------------------------------------------
Hokkaido Electric Power Co.                              8,800           173,046
- --------------------------------------------------------------------------------
Horizon Natural Resources Co. 2,4                        6,667                --
- --------------------------------------------------------------------------------
Humana, Inc. 4                                           6,400           190,016
- --------------------------------------------------------------------------------
ICO Global Communication
Holdings Ltd. 4                                          6,016             3,068
- --------------------------------------------------------------------------------
Imerys SA                                                2,210           185,493
- --------------------------------------------------------------------------------
iPCS, Inc. 4                                             8,548           260,714
- --------------------------------------------------------------------------------
Janus Capital Group, Inc.                               10,100           169,781
- --------------------------------------------------------------------------------
Japan Real Estate
Investment Corp.                                            20           168,635
- --------------------------------------------------------------------------------
Karstadt Quelle AG                                      16,370           169,107
- --------------------------------------------------------------------------------
Kawasaki Kisen Kaisha Ltd.                              25,000           161,344
- --------------------------------------------------------------------------------
KB Home                                                  1,800           187,920
- --------------------------------------------------------------------------------
Klepierre                                                1,960           173,568
- --------------------------------------------------------------------------------
Lafarge SA                                               1,790           172,747
- --------------------------------------------------------------------------------
Leap Wireless International, Inc. 4                      1,714            46,278
- --------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.                           2,000           174,960
- --------------------------------------------------------------------------------
Lincoln National Corp.                                   3,500           163,380
- --------------------------------------------------------------------------------
Lloyds TSB Group plc                                    20,870           189,523
- --------------------------------------------------------------------------------
Loews Corp.                                              2,400           168,720
- --------------------------------------------------------------------------------
Louisiana-Pacific Corp.                                  6,200           165,788
- --------------------------------------------------------------------------------
MAN AG                                                   4,423           169,718
- --------------------------------------------------------------------------------
Marathon Oil Corp.                                       4,500           169,245
- --------------------------------------------------------------------------------
MBIA, Inc.                                               2,700           170,856
- --------------------------------------------------------------------------------
MCI, Inc.                                                1,629            32,841
- --------------------------------------------------------------------------------
Merck KGaA                                               2,902           198,410
- --------------------------------------------------------------------------------
MetLife, Inc.                                            4,200           170,142
- --------------------------------------------------------------------------------
Mitsui O.S.K. Lines Ltd.                                27,000           162,047
- --------------------------------------------------------------------------------
Nippon Building Fund, Inc.                                  19           162,057



                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS Continued
- --------------------------------------------------------------------------------
Nippon Yusen Kabushiki Kaisha                           32,000   $       172,382
- --------------------------------------------------------------------------------
Norfolk Southern Corp.                                   4,700           170,093
- --------------------------------------------------------------------------------
Novar plc                                               54,100           195,529
- --------------------------------------------------------------------------------
NSK Ltd.                                                36,000           180,931
- --------------------------------------------------------------------------------
NTL, Inc. 4                                              7,842           572,152
- --------------------------------------------------------------------------------
Nucor Corp.                                              3,200           167,488
- --------------------------------------------------------------------------------
Occidental Petroleum Corp.                               3,000           175,080
- --------------------------------------------------------------------------------
Orbital Sciences Corp. 4                                   745             8,813
- --------------------------------------------------------------------------------
Peninsular & Oriental Steam
Navigation Co.                                          29,210           166,839
- --------------------------------------------------------------------------------
PG&E Corp. 4                                             5,200           173,056
- --------------------------------------------------------------------------------
Phelps Dodge Corp.                                       1,800           178,056
- --------------------------------------------------------------------------------
Pilkington plc                                          82,360           173,935
- --------------------------------------------------------------------------------
Pioneer Cos., Inc. 4                                     7,312           151,724
- --------------------------------------------------------------------------------
Prandium, Inc. 2,4                                      24,165               266
- --------------------------------------------------------------------------------
Premier Holdings Ltd. 2,4                               18,514                --
- --------------------------------------------------------------------------------
Prudential Financial, Inc.                               3,300           181,368
- --------------------------------------------------------------------------------
Pulte Homes, Inc.                                        2,910           185,658
- --------------------------------------------------------------------------------
Rakuten, Inc.                                               20            22,913
- --------------------------------------------------------------------------------
Rakuten, Inc. 4                                            180           161,608
- --------------------------------------------------------------------------------
RMC Group plc                                           10,440           170,172
- --------------------------------------------------------------------------------
Rolls-Royce Group plc                                   33,400           158,388
- --------------------------------------------------------------------------------
RWE AG                                                   3,155           174,110
- --------------------------------------------------------------------------------
Ryder Systems, Inc.                                      3,100           148,087
- --------------------------------------------------------------------------------
SABMiller plc                                           10,200           169,197
- --------------------------------------------------------------------------------
Safeco Corp.                                             3,400           177,616
- --------------------------------------------------------------------------------
Sears Roebuck & Co.                                      3,200           163,296
- --------------------------------------------------------------------------------
Sega Sammy Holdings, Inc. 4                              3,200           175,817
- --------------------------------------------------------------------------------
Sempra Energy                                            4,600           168,728
- --------------------------------------------------------------------------------
Severn Trent plc                                         9,880           183,427
- --------------------------------------------------------------------------------
Showa Shell Sekiyu K.K                                  18,380           167,352
- --------------------------------------------------------------------------------
Societe Generale, Cl. A                                  1,720           174,057
- --------------------------------------------------------------------------------
Star Gas Partners LP                                       187             1,393
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. 2,4                               716            26,671
- --------------------------------------------------------------------------------
Suedzucker AG                                            8,314           173,241
- --------------------------------------------------------------------------------
Suez SA                                                  7,140           190,413
- --------------------------------------------------------------------------------
Sunoco, Inc.                                             2,100           171,591
- --------------------------------------------------------------------------------
Tate & Lyle plc                                         17,860           162,103
- --------------------------------------------------------------------------------
Technip SA                                               1,000           184,858
- --------------------------------------------------------------------------------
Telewest Global, Inc. 4                                 31,828           559,536
- --------------------------------------------------------------------------------
Telus Corp.                                                269             7,774
- --------------------------------------------------------------------------------
Tohoku Electric Power Co.                                9,430           169,330
- --------------------------------------------------------------------------------
TonenGeneral Sekiyu K.K                                 17,870           162,708
- --------------------------------------------------------------------------------
Total SA, B Shares                                         760           166,561
- --------------------------------------------------------------------------------
Toys R Us, Inc. 4                                        8,400           171,948


            26 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                                           VALUE
                                                        SHARES        SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS Continued
- --------------------------------------------------------------------------------
Transocean, Inc. 4                                       4,400   $       186,516
- --------------------------------------------------------------------------------
TUI AG                                                   7,536           178,746
- --------------------------------------------------------------------------------
TVMAX Holdings, Inc. 2,4                                 1,000             5,950
- --------------------------------------------------------------------------------
TXU Corp.                                                2,800           180,768
- --------------------------------------------------------------------------------
Unibail                                                  1,180           185,733
- --------------------------------------------------------------------------------
United States Steel Corp.                                3,300           169,125
- --------------------------------------------------------------------------------
United Utilities plc                                    15,620           188,930
- --------------------------------------------------------------------------------
UnitedGlobalCom, Inc., Cl. A 4                          58,063           560,889
- --------------------------------------------------------------------------------
Unocal Corp.                                             3,900           168,636
- --------------------------------------------------------------------------------
Utilities Select Sector SPDR Fund                       24,200           673,970
- --------------------------------------------------------------------------------
Valero Energy Corp.                                      3,900           177,060
- --------------------------------------------------------------------------------
Viatel Holding Ltd. (Bermuda) 2,4                        2,251             2,701
- --------------------------------------------------------------------------------
Vinci                                                    1,360           182,640
- --------------------------------------------------------------------------------
Western Forest Products, Inc. 4                         38,252           212,307
- --------------------------------------------------------------------------------
WRC Media Corp. 2,4                                      1,082                22
- --------------------------------------------------------------------------------
XO Communications, Inc. 4                                1,100             3,344
                                                                 ---------------
Total Common Stocks
(Cost $21,237,672)                                                    23,790,482

                                                         UNITS
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- --------------------------------------------------------------------------------
American Tower Corp. Wts.,
Exp. 8/1/08 4,7                                            800           184,400
- --------------------------------------------------------------------------------
ASAT Finance LLC Wts.,
Exp. 11/1/06 2,4                                           250                 2
- --------------------------------------------------------------------------------
Citigroup, Inc. Litigation Wts.,
Exp. 12/31/50 4                                          2,404             3,414
- --------------------------------------------------------------------------------
COLO.com, Inc. Wts.,
Exp. 3/15/10 2,4                                           400                 4
- --------------------------------------------------------------------------------
Concentric Network Corp. Wts.,
Exp. 12/15/07 2,4                                          100                --
- --------------------------------------------------------------------------------
Covergent Communications,
Inc. Wts., Exp. 4/1/08 2,4                                 400                 4
- --------------------------------------------------------------------------------
HF Holdings, Inc. Wts.,
Exp. 9/27/09 2,4                                           530                 5
- --------------------------------------------------------------------------------
Horizon PCS, Inc. Wts.,
Exp. 10/1/10 2,4                                         1,000                --
- --------------------------------------------------------------------------------
Huntsman Co. LLC Wts.,
Exp. 5/15/11 2,4                                           300           141,150
- --------------------------------------------------------------------------------
ICG Communications, Inc. Wts.,
Exp. 9/15/05 2,4                                           825                 8
- --------------------------------------------------------------------------------
ICO Global Communication
Holdings Ltd. Wts.:
Exp. 5/16/06 2,4                                         1,509                 8
Exp. 5/16/06 2,4                                             2                --
- --------------------------------------------------------------------------------
Imperial Credit Industries,
Inc. Wts., Exp. 1/31/08 2,4                              2,135                --
- --------------------------------------------------------------------------------
Insilco Corp. Wts., Exp. 8/15/07 2,4                       270                --

                                                                           VALUE
                                                         UNITS        SEE NOTE 1
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES Continued
- --------------------------------------------------------------------------------
iPCS, Inc. Wts., Exp. 6/15/10 2,4                          300   $             3
- --------------------------------------------------------------------------------
Leap Wireless International,
Inc. Wts., Exp. 4/15/10 2,4                                275                 3
- --------------------------------------------------------------------------------
Long Distance International,
Inc. Wts., Exp. 4/13/08 2,4                                200                --
- --------------------------------------------------------------------------------
Loral Space &
Communications Ltd. Wts.,
Exp. 1/15/07 2,4                                           150                 2
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc. Wts.,
Exp. 7/15/05 2,4                                           250                 3
- --------------------------------------------------------------------------------
Ntelos, Inc. Wts., Exp. 8/15/10 2,4                        450                 5
- --------------------------------------------------------------------------------
Pathmark Stores, Inc. Wts.,
Exp. 9/19/10 4                                           5,710             1,142
- --------------------------------------------------------------------------------
PLD Telekom, Inc. Wts.,
Exp. 6/1/06 2,4                                            300                 3
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. Wts.,
Exp. 12/19/08 2,4                                        1,165             5,432
- --------------------------------------------------------------------------------
Venezuela (Republic of) Oil
Linked Payment Obligation Wts.,
Exp. 4/15/20 2,4                                         3,256                --
- --------------------------------------------------------------------------------
Verado Holdings, Inc., Cl. B Wts.,
Exp. 4/15/08 4                                             175               119
- --------------------------------------------------------------------------------
XO Communications, Inc.,
Cl. A Wts., Exp. 1/16/10 4                               2,204             1,488
- --------------------------------------------------------------------------------
XO Communications, Inc.,
Cl. B Wts., Exp. 1/16/10 4                               1,653               793
- --------------------------------------------------------------------------------
XO Communications, Inc.,
Cl. C Wts., Exp. 1/16/10 4                               1,653               645
                                                                 ---------------
Total Rights, Warrants and
Certificates (Cost $80,050)                                              338,633

                                                     PRINCIPAL
                                                        AMOUNT
- --------------------------------------------------------------------------------
STRUCTURED NOTES--10.2%
- --------------------------------------------------------------------------------
Citigroup Global Markets
Holdings, Inc.:
Brazilian Real Unsec. Credit
Linked Nts., 0.93%, 1/14/05                      $   1,982,615         2,319,858
Colombia (Republic of)
Unsec. Credit Linked Nts.,
15%, 3/15/07 [COP]                               3,860,150,000         2,002,175
Colombia (Republic of)
Unsec. Credit Linked Nts.,
15%, 4/27/12 [COP]                               1,800,000,000           939,374
Colombia (Republic of)
Unsec. Credit Linked Nts.,
15%, 4/27/12 [COP]                               1,200,000,000           626,250
Colombia (Republic of)
Unsec. Credit Linked Nts.,
15%, 4/27/12 5 [COP]                             1,034,000,000           536,533
Colombia (Republic of)
Unsec. Credit Linked Nts.,
3.12%, 11/20/09                                      2,920,000         2,959,128


            27 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------
                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
STRUCTURED NOTES Continued
- --------------------------------------------------------------------------------
Citigroup Global Markets
Holdings, Inc.: Continued
Dominican Republic Peso
Unsec. Credit Linked Nts.,
24.05%, 3/21/05 [DOP]                               21,604,000   $       711,287
Dominican Republic Peso
Unsec. Credit Linked Nts.,
24.32%, 3/7/05 [DOP]                                20,810,000           698,398
Peruvian Sol Unsec. Linked Nts.,
1.466%, 1/14/05 [PEN]                                4,200,000         1,356,450
Ukraine Hryvnia Unsec. Credit
Linked Nts., 7.50%, 5/6/05 2 [UAH]                   3,980,000           749,529
- --------------------------------------------------------------------------------
Credit Suisse First Boston
Corp. (Cayman):
Russia (Government of)
Linked Bonds,
Series 24, 15%, 9/2/05 [RUR]                        22,279,000           861,189
Russia (Government of)
Linked Bonds,
Series 26, 15%, 3/11/05 [RUR]                       22,587,000           838,872
- --------------------------------------------------------------------------------
Credit Suisse First Boston
International, OAO Gazprom
Credit Linked Nts.,
8.11%, 1/21/07 [RUR]                                28,065,000         1,058,573
- --------------------------------------------------------------------------------
Credit Suisse First Boston, Inc.:
(Nassau Branch), Turkey
(Republic of) Credit Linked Nts.,
20%, 10/18/07                                          352,000           387,633
(Nassau Branch), Turkey
(Republic of) Credit Linked Nts.,
Series EM 868, 27.50%, 8/25/05                       2,125,000         1,881,220
(Nassau Branch), Turkey
(Republic of) Credit Linked Nts.,
Series EM 872, 23.57%, 10/20/05 1                      396,000           425,904
(Nassau Branch), Turkey
(Republic of) Credit Linked Nts.,
Series EM 880, 20%, 10/18/07                         1,190,000         1,450,705
(Nassau Branch), Turkey
(Republic of) Credit Linked Nts.,
Series NA S 316, 24.45%, 2/23/06                       607,000           488,435
(USA), U.S. Dollar/South African
Rand Linked Nts.,
Series FBi 43, 1.468%, 5/23/22                         825,000           784,080
- --------------------------------------------------------------------------------
Deutsche Bank AG:
European Investment Bank
Credit Bonds, 5.65%, 1/19/10 5                         705,000           533,897
Indonesia (Republic of) Credit
Linked Nts., 14.25%, 6/22/13                           942,000         1,146,885
Indonesia (Republic of) Credit
Linked Nts., 14.25%, 6/22/13                           938,000         1,142,015
Korea (Republic of) Credit
Bonds, 2.49%, 6/20/09                                3,900,000         3,945,240
Moscow (City of) Linked Nts.,
10%, 5/27/05 [RUR]                                  13,440,000           498,080
Moscow (City of) Linked Nts.,
15%, 9/2/05 [RUR]                                   30,255,000         1,170,046


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
STRUCTURED NOTES Continued
- --------------------------------------------------------------------------------
Deutsche Bank AG: Continued
Nigeria (Federal Republic of)
Naira Linked Nts.,
13.25%, 3/17/05 [NGN]                               97,403,000   $       710,460
Nigeria (Federal Republic of)
Naira Linked Nts.,
13.75%, 3/3/05 [NGN]                                65,974,000           484,338
Nigeria (Republic of)
Credit Linked Nts.,
13.90%, 2/24/05 [NGN]                              119,040,000           876,149
OAO Gazprom I Credit Nts.,
6.20%, 10/20/07                                        790,000           841,076
OAO Gazprom II Credit Nts.,
5.95%, 4/20/07                                         790,000           831,663
Romania (The State of)
Leu Linked Nts., 11.49%,
12/4/06 [ROL]                                    7,886,400,000           274,045
Russian Federation Linked Nts.,
8.40%, 12/2/09 [RUR]                                19,221,000           698,266
Ukraine (Republic of)
Credit Linked Nts., 6.54%, 8/5/11                    4,070,000         4,389,292
Ukraine (Republic of)
Hryvnia Credit Linked Nts.,
0%, 12/17/05 [UAH]                                   1,469,000           276,274
Ukraine (Republic of)
Hryvnia Credit Linked Nts.,
11.70%, 5/31/06 [UAH]                                1,727,000           325,089
- --------------------------------------------------------------------------------
Dow Jones CDX High Yield
Index Pass-Through Certificates:
Series 3-1, 7.75%, 12/29/09 7,16                    13,200,000        13,587,750
Series 3-3, 8%, 12/29/09 7,16                       12,700,000        13,041,313
- --------------------------------------------------------------------------------
Lehman Brothers International:
Turkey (Republic of) Treasury
Bills Total Return Linked Nts.,
20%, 10/17/07                                        1,260,000         1,512,630
Turkey (Republic of) Treasury
Bills Total Return Linked Nts.,
24.20%, 8/25/05                                      1,165,000         1,003,182
Turkey (Republic of) Treasury
Bills Total Return Linked Nts.,
28.25%, 5/26/05                                      1,261,309         1,277,580
- --------------------------------------------------------------------------------
Lehman Brothers Special
Financing, Inc., High Yield Index
Linked Nts., 1.017%, 1/1/05 16                      10,000,000        10,145,251
- --------------------------------------------------------------------------------
Morgan Stanley Capital
Services, Inc., Venezuela
(Republic of) Credit Bonds,
5%, 9/20/09                                          1,665,000         1,844,587
- --------------------------------------------------------------------------------
Pioneer 2002 Ltd. Sec.
Catastrophe Linked Nts.:
Series 2002-1, Cl. E-A,
6.74%, 6/15/06 1                                       750,000           758,199
Series 2003-II, Cl. A,
8.49%, 6/15/06 1,7                                     500,000           512,183


            28 | OPPENHEIMER STRATEGIC BOND FUND/VA


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
STRUCTURED NOTES Continued
- --------------------------------------------------------------------------------
Pioneer 2002 Ltd. Sec
Catastrophe Linked Nts.: Continued
Series 2003-II, Cl. B,
7.49%, 6/15/06 1,7                               $     500,000   $      510,214
Series 2003-II, Cl. C,
8.24%, 6/15/06 1,7                                     500,000          508,153
- --------------------------------------------------------------------------------
Swiss Re Capital Markets Corp./
Oak Capital Ltd.
Catastrophe Linked Nts.,
7.24%, 6/15/07 1,2                                     250,000          256,949
- --------------------------------------------------------------------------------
Swiss Re Capital Markets Corp./
Pioneer 2002 Ltd. Sec
Catastrophe Linked Nts.,
Series 2002, Cl. A-A,
8.49%, 6/15/06 1,7                                     250,000          254,995
- --------------------------------------------------------------------------------
UBS AG:
Israel (State of) Shekel
Linked Nts., 7.50%, 4/5/14 [ILS]                     4,792,700        1,195,040
OAO Gazprom III Credit Nts.,
4.71%, 7/5/06                                        1,980,000        2,085,757
                                                                 ---------------
Total Structured Notes
(Cost $82,684,631)                                                   87,712,191

                                DATE    STRIKE       CONTRACTS
- --------------------------------------------------------------------------------
OPTIONS PURCHASED--0.0%
- --------------------------------------------------------------------------------
Brazilian Real Call 4        1/19/05    $ 2.80       1,175,000           10,575
- --------------------------------------------------------------------------------
Turkish Lira Put 4            1/6/05      1.00       1,150,000              575
- --------------------------------------------------------------------------------
U.S. Treasury Bonds,
5.375%, 2/15/31 Call 4       1/18/05   109.285%         35,720          125,598
                                                                 ---------------
Total Options Purchased (Cost $427,865)                                 136,748

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--10.0% 17
- --------------------------------------------------------------------------------
Undivided interest of 5.96% in joint repurchase
agreement (Principal Amount/Value
$1,443,703,000, with a maturity value of
$1,443,962,867) with UBS Warburg LLC, 2.16%,
dated 12/31/04, to be repurchased at
$86,039,484 on 1/3/05, collateralized by
Federal National Mortgage Assn., 5%--6%,
4/1/34--10/1/34, with a value of
$1,474,609,071
(Cost $86,024,000)                                  86,024,000       86,024,000


                                                     PRINCIPAL             VALUE
                                                        AMOUNT        SEE NOTE 1
- --------------------------------------------------------------------------------
Total Investments, at Value
(excluding Investments
Purchased with Cash
Collateral from
Securities Loaned)
(Cost $859,418,744)                                              $  906,044,631

- --------------------------------------------------------------------------------
INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM
SECURITIES LOANED--1.7%
- --------------------------------------------------------------------------------
ASSET-BACKED FLOATING SECURITY--0.1%
Whitehawk CDO Funding
Corp., 2.56%, 3/15/05 18                         $   1,000,000        1,000,000
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--1.5% Undivided interest of 5.96% in joint repurchase
agreement (Principal Amount/Value $155,205,723, with a maturity value of
$155,232,367) with Credit Suisse First Boston LLC, 2.06%, dated 12/31/04, to be
repurchased at $9,252,431 on 1/3/05, collateralized by AA Corporate Bonds,
0%-15.73%, 1/1/06-7/16/44,
with a value of $158,312,640 18                      9,250,843        9,250,843
- --------------------------------------------------------------------------------
Undivided interest of 0.39% in joint repurchase
agreement (Principal Amount/Value $2,800,000,000, with a maturity value of
$2,800,550,669) with Nomura Securities, 2.36%, dated 12/31/04, to be repurchased
at $3,827,941 on 1/3/05, collateralized by U.S. Government Mortgage Agencies,
2.58%-7.50%, 1/15/08-10/15/44, with a value of
$2,908,566,289 18                                    3,827,188        3,827,188
                                                                 ---------------
                                                                      13,078,031

- --------------------------------------------------------------------------------
YANKEE FLOATING CERTIFICATES OF DEPOSIT--0.1%
Banco Bilbao Vizcaya NY,
2.248% Deposit Nts., 2/10/05 18                        799,967          799,967
                                                                 ---------------
Total Investments Purchased
with Cash Collateral from
Securities Loaned
(Cost $14,877,998)                                                   14,877,998

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $874,296,742)                                      107.4%     920,922,629
- --------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF
OTHER ASSETS                                              (7.4)     (63,302,323)
                                                 -------------------------------
NET ASSETS                                               100.0%  $  857,620,306
                                                 ===============================


            29 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

FOOTNOTES TO STATEMENT OF INVESTMENTS

Principal amount, contracts and exercise price are reported in U.S. Dollars,
except for those denoted in the following currencies:

ARP        Argentine Peso
AUD        Australian Dollar
BRR        Brazilian Real
CAD        Canadian Dollar
COP        Colombian Peso
DEM        German Mark
DKK        Danish Krone
DOP        Dominican Republic Peso
EUR        Euro
FRF        French Franc
GBP        British Pound Sterling
ILS        Israeli Shekel
JPY        Japanese Yen
MXN        Mexican Nuevo Peso
NGN        Nigeria Naira
NZD        New Zealand Dollar
PEN        Peruvian New Sol
PLZ        Polish Zloty
ROL        Romanian Leu
RUR        Russian Ruble
SEK        Swedish Krona
UAH        Ukraine Hryvnia
ZAR        South African Rand

1. Represents the current interest rate for a variable or increasing rate
security.

2. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of December 31, 2004 was $26,847,365, which represents
3.13% of the Fund's net assets, of which $70,658 is considered restricted. See
Note 11 of Notes to Financial Statements.

3. Issue is in default. See Note 1 of Notes to Financial Statements.

4. Non-income producing security.

5. When-issued security or forward commitment to be delivered and settled after
December 31, 2004. See Note 1 of Notes to Financial Statements.

6. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows. These securities amount to $2,971,051 or 0.35% of the Fund's net assets
as of December 31, 2004.

7. 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 $78,866,795 or 9.20% of the Fund's net
assets as of December 31, 2004.

8. Zero coupon bond reflects effective yield on the date of purchase.

9. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts with an aggregate
market value of $1,957,202. See Note 6 of Notes to Financial Statements.

10. A sufficient amount of securities has been designated to cover outstanding
foreign currency contracts. See Note 5 of Notes to Financial Statements.

11. A sufficient amount of securities has been designated to cover outstanding
written put options, as follows:



                                                   CONTRACTS         EXPIRATION     EXERCISE           PREMIUM          VALUE
                                               SUBJECT TO PUT             DATES        PRICE          RECEIVED     SEE NOTE 1
- -----------------------------------------------------------------------------------------------------------------------------

Brazilian Real (BRR)                                1,175,000           1/19/05        $2.65          $  1,792        $ 8,196
Turkish Lira (TRL)                                  1,150,000            1/6/05         1.00             3,565         11,499
                                                                                                      -----------------------
                                                                                                      $  5,357        $19,695
                                                                                                      =======================


12. A sufficient amount of liquid assets has been designated to cover
outstanding written call options, as follows:



                                                    CONTRACTS        EXPIRATION     EXERCISE           PREMIUM          VALUE
                                              SUBJECT TO CALL              DATE         RATE          RECEIVED     SEE NOTE 1
- -----------------------------------------------------------------------------------------------------------------------------

New Zealand (Government of) Bonds, 7% 7/15/09             945NZD         3/7/05         5.95%NZD      $  2,661        $   444


13. Denotes a step bond: a zero coupon bond that converts to a fixed or variable
interest rate at a designated future date.

14. Interest or dividend is paid-in-kind.

15. Received as the result of issuer reorganization.

16. Interest rate represents a weighted average rate comprised of the interest
rates of the underlying securities.

17. The Fund may have elements of risk due to concentrated investments. Such
concentrations may subject the Fund to additional risks.

18. The security has been segregated to satisfy the forward commitment to return
the cash collateral received in securities lending transactions upon the
borrower's return of the securities loaned. See Note 12 of Notes to Financial
Statements.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            30 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------------

ASSETS
- ---------------------------------------------------------------------------------------------------------------------
Investments, at value (including cost and market value of $$86,024,000 in repurchase agreements)
(including securities loaned of $44,013,349) (cost $874,296,742)--see accompanying
statement of investments                                                                             $   920,922,629
- ---------------------------------------------------------------------------------------------------------------------
Cash                                                                                                       2,055,902
- ---------------------------------------------------------------------------------------------------------------------
Collateral for securities loaned                                                                          29,980,833
- ---------------------------------------------------------------------------------------------------------------------
Unrealized appreciation on foreign currency contracts                                                      3,540,592
- ---------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold (including $12,465,550 sold on a when-issued basis or forward commitment)                12,692,922
Interest, dividends and principal paydowns                                                                10,583,665
Shares of beneficial interest sold                                                                         3,295,957
Futures margins                                                                                               33,583
Other                                                                                                          9,827
                                                                                                     ----------------
Total assets                                                                                             983,115,910

- ---------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------------------------------------------------------
Bank overdraft-foreign currencies (cost $96,882)                                                              96,964
- ---------------------------------------------------------------------------------------------------------------------
Options written, at value (premiums received $8,018)--see accompanying statement of investments               20,139
- ---------------------------------------------------------------------------------------------------------------------
Swaptions written, at value (premiums received $94,462)                                                       70,869
- ---------------------------------------------------------------------------------------------------------------------
Return of collateral for securities loaned                                                                44,858,831
- ---------------------------------------------------------------------------------------------------------------------
Unrealized depreciation on foreign currency contracts                                                      3,277,300
- ---------------------------------------------------------------------------------------------------------------------
Unrealized depreciation on swap contracts                                                                  1,458,503
- ---------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased on a when-issued basis or forward commitment                                        73,731,367
Closed foreign currency contracts                                                                          1,588,757
Shares of beneficial interest redeemed                                                                       147,125
Distribution and service plan fees                                                                           133,244
Shareholder communications                                                                                    34,768
Trustees' compensation                                                                                        14,921
Transfer and shareholder servicing agent fees                                                                  1,705
Other                                                                                                         61,111
                                                                                                     ----------------
Total liabilities                                                                                        125,495,604

- ---------------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                           $   857,620,306
                                                                                                     ================

- ---------------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ---------------------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                                           $       164,032
- ---------------------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                               797,449,500
- ---------------------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                                         39,051,911
- ---------------------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions                           (24,499,421)
- ---------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies                                                                         45,454,284
                                                                                                     ----------------
NET ASSETS                                                                                           $   857,620,306
                                                                                                     ================

- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ---------------------------------------------------------------------------------------------------------------------
Non-Service Shares:
Net asset value, redemption price per share and offering price per share
(based on net assets of $614,915,045 and 118,133,764 shares of beneficial interest outstanding)      $          5.21
- ---------------------------------------------------------------------------------------------------------------------
Service Shares:
Net asset value, redemption price per share and offering price per share
(based on net assets of $242,705,261 and 45,898,401 shares of beneficial interest outstanding)       $          5.29


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            31 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------------

INVESTMENT INCOME
- ---------------------------------------------------------------------------------------------------------------------
Interest                                                                                             $    35,831,510
- ---------------------------------------------------------------------------------------------------------------------
Fee income                                                                                                 1,811,978
- ---------------------------------------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $7,565)                                                       150,977
- ---------------------------------------------------------------------------------------------------------------------
Portfolio lending fees                                                                                        35,374
                                                                                                     ----------------
Total investment income                                                                                   37,829,839

- ---------------------------------------------------------------------------------------------------------------------
EXPENSES
- ---------------------------------------------------------------------------------------------------------------------
Management fees                                                                                            5,203,309
- ---------------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Service shares                                                           373,995
- ---------------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares                                                                                            10,083
Service shares                                                                                                10,030
- ---------------------------------------------------------------------------------------------------------------------
Shareholder communications:
Non-Service shares                                                                                            42,334
Service shares                                                                                                 8,511
- ---------------------------------------------------------------------------------------------------------------------
Custodian fees and expenses                                                                                   92,792
- ---------------------------------------------------------------------------------------------------------------------
Trustees' compensation                                                                                        20,732
- ---------------------------------------------------------------------------------------------------------------------
Other                                                                                                         72,134
                                                                                                     ----------------
Total expenses                                                                                             5,833,920
Less reduction to custodian expenses                                                                         (21,553)
                                                                                                     ----------------
Net expenses                                                                                               5,812,367

- ---------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                                                     32,017,472

- ---------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- ---------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments (including premiums on options exercised)                                                      2,526,920
Closing of futures contracts                                                                                  28,864
Closing and expiration of option contracts written                                                           484,456
Closing and expiration of swaption contracts                                                                (326,048)
Foreign currency transactions                                                                              4,604,115
Swap contracts                                                                                               293,602
                                                                                                     ----------------
Net realized gain                                                                                          7,611,909
- ---------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on:
Investments                                                                                               16,486,291
Translation of assets and liabilities denominated in foreign currencies                                    9,070,184
Futures contracts                                                                                             67,809
Option contracts                                                                                            (153,144)
Swaption contracts                                                                                            39,135
Swap contracts                                                                                              (502,851)
                                                                                                     ----------------
Net change in unrealized appreciation                                                                     25,007,424

- ---------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                                                 $    64,636,805
                                                                                                     ================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            32 | OPPENHEIMER STRATEGIC BOND FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                                   2004               2003
- ------------------------------------------------------------------------------------------------------------------

OPERATIONS
- ------------------------------------------------------------------------------------------------------------------
Net investment income                                                           $   32,017,472    $    28,077,622
- ------------------------------------------------------------------------------------------------------------------
Net realized gain                                                                    7,611,909         13,639,276
- ------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                                25,007,424         41,999,716
                                                                                ----------------------------------
Net increase in net assets resulting from operations                                64,636,805         83,716,614

- ------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ------------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Non-Service shares                                                                 (29,467,620)       (28,473,133)
Service shares                                                                      (5,049,740)          (842,251)

- ------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial interest transactions:
Non-Service shares                                                                  23,501,705        115,808,103
Service shares                                                                     152,771,336         66,753,974

- ------------------------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------------------------
Total increase                                                                     206,392,486        236,963,307
- ------------------------------------------------------------------------------------------------------------------
Beginning of period                                                                651,227,820        414,264,513
                                                                                ----------------------------------
End of period (including accumulated net investment income of $39,051,911
and $32,618,798, respectively)                                                  $  857,620,306    $   651,227,820
                                                                                ==================================


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            33 | OPPENHEIMER STRATEGIC BOND FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                2004              2003            2002            2001            2000
- -----------------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $        5.05     $        4.57     $      4.62     $      4.69     $      4.97
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                       .22 1             .22             .29             .41             .41
Net realized and unrealized gain (loss)                     .20               .56             .03            (.19)           (.28)
                                                  ----------------------------------------------------------------------------------
Total from investment operations                            .42               .78             .32             .22             .13
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                       (.26)             (.30)           (.37)           (.29)           (.41)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $        5.21     $        5.05     $      4.57     $      4.62     $      4.69
                                                  =================================================================================

- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                         8.67%            18.07%           7.44%           4.85%           2.63%
- -----------------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $     614,915     $     571,445     $   406,126     $   351,686     $   304,562
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $     584,878     $     472,213     $   374,519     $   330,711     $   289,923
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                      4.50%             5.61%           6.89%           8.78%           9.23%
Total expenses                                             0.74%             0.75%           0.79%           0.79%           0.79%
Expenses after payments and waivers and
reduction to custodian expenses                             N/A 4             N/A 4          0.78%            N/A 4           N/A 4
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                      88% 5            117%             65%            104%            104%


1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Reduction to custodian expenses less than 0.01%.

5. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$959,649,113 and $973,488,511, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            34 | OPPENHEIMER STRATEGIC BOND FUND/VA




SERVICE SHARES  YEAR ENDED DECEMBER 31,                   2004           2003          2002        2001 1
- ---------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- ---------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $       5.13     $     4.67     $    4.73     $  4.64
- ---------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                      .19 2          .27           .03         .15
Net realized and unrealized gain (loss)                    .22            .49           .28        (.06)
                                                  -------------------------------------------------------
Total from investment operations                           .41            .76           .31         .09
- ---------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.25)          (.30)         (.37)         --
- ---------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $       5.29     $     5.13     $    4.67     $  4.73
                                                  =======================================================

- ---------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                        8.43%         17.16%         7.03%       1.94%
- ---------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $    242,705     $   79,782     $   8,138     $     4
- ---------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $    150,040     $   34,744     $   2,307     $     2
- ---------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                     3.82%          4.57%         5.40%       8.17%
Total expenses                                            0.99%          1.02%         1.06%       0.92%
Expenses after payments and waivers and
reduction to custodian expenses                            N/A 5          N/A 5        1.03%        N/A 5
- ---------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                     88% 6         117%           65%        104%


1. For the period from March 19, 2001 (inception of offering) to December 31,
2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

6. The portfolio turnover rate excludes purchase transactions and sales
transactions of To Be Announced (TBA) mortgage-related securities of
$959,649,113 and $973,488,511, respectively.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            35 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Strategic Bond Fund/VA (the Fund) is a separate series of
Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's investment objective is to seek a high level of current
income principally derived from interest on debt securities. The Trust's
investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products. The class of shares designated as Service shares is subject to a
distribution and service plan. Both classes of shares have identical rights and
voting privileges with respect to the Fund in general and exclusive voting
rights on matters that affect that class alone. Earnings, net assets and net
asset value per share may differ due to each class having its own expenses, such
as transfer and shareholder servicing agent fees and shareholder communications,
directly attributable to that class.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
STRUCTURED NOTES. The Fund invests in structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss when
a structured note is sold or matures. As of December 31, 2004, the market value
of these securities comprised 10.2% of the Fund's net assets and resulted in
unrealized cumulative gains of $5,027,560.

- --------------------------------------------------------------------------------
SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment
for securities that have been purchased by the Fund on a when-issued basis or
forward commitment can take place up to ten days or more after the trade date.
Normally the settlement date occurs within six months after the trade date;
however, the Fund may, from time to time, purchase securities whose settlement
date extends six months or more beyond trade date. During this period, such
securities do not earn interest, are subject to market fluctuation and may
increase or decrease in value prior to their delivery. The Fund maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The purchase of securities on a when-issued
basis or forward commitment may increase the volatility of the Fund's net asset
value to the extent the Fund executes such transactions while


            36 | OPPENHEIMER STRATEGIC BOND FUND/VA


remaining substantially fully invested. The Fund may also sell securities that
it purchased on a when-issued basis or forward commitment prior to settlement of
the original purchase. As of December 31, 2004, the Fund had purchased
$73,731,367 of securities on a when-issued basis or forward commitment and sold
$12,465,550 of securities issued on a when-issued basis or forward commitment.

      In connection with its ability to purchase or sell securities on a
when-issued basis, the Fund may enter into forward roll transactions with
respect to mortgage-related securities. Forward roll transactions require the
sale of securities for delivery in the current month, and a simultaneous
agreement with the same counterparty to repurchase similar (same type, coupon
and maturity) but not identical securities on a specified future date. The Fund
records the incremental difference between the forward purchase and sale of each
forward roll as realized gain (loss) on investments or as fee income in the case
of such transactions that have an associated fee in lieu of a difference in the
forward purchase and sale price.

      Risks of entering into forward roll transactions include the potential
inability of the counterparty to meet the terms of the agreement; the potential
of the Fund to receive inferior securities at redelivery as compared to the
securities sold to the counterparty; counterparty credit risk; and the potential
pay down speed variance between the mortgage-related pools.

- --------------------------------------------------------------------------------
SECURITY CREDIT RISK. The Fund invests in high-yield securities, which may be
subject to a greater degree of credit risk, market fluctuations and loss of
income and principal, and may be more sensitive to economic conditions than
lower-yielding, higher-rated fixed-income securities. The Fund may acquire
securities in default, and is not obligated to dispose of securities whose
issuers subsequently default. As of December 31, 2004, securities with an
aggregate market value of $4,866,448, representing 0.57% of the Fund's net
assets, were in default.

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.


            37 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                                  NET UNREALIZED
                                                                    APPRECIATION
                                                                BASED ON COST OF
                                                                  SECURITIES AND
UNDISTRIBUTED    UNDISTRIBUTED                  ACCUMULATED    OTHER INVESTMENTS
NET INVESTMENT       LONG-TERM                         LOSS   FOR FEDERAL INCOME
INCOME                    GAIN   CARRYFORWARD 1,2,3,4,5,6,7         TAX PURPOSES
- --------------------------------------------------------------------------------
$40,140,664                $--                  $24,032,280          $44,353,647

1. As of December 31, 2004, the Fund had $21,566,899 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of December 31, 2004,
details of the capital loss carryforwards were as follows:

                            EXPIRING
                            -----------------------------
                            2007            $   4,546,599
                            2008                  253,735
                            2009                9,904,928
                            2010                6,861,637
                                            -------------
                            Total           $  21,566,899
                                            =============

2. As of December 31, 2004, the Fund had $478,895 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

3. The Fund had $1,979,188 of post-October foreign currency losses which were
deferred.

4. The Fund had $1,918 of post-October passive foreign investment company losses
which were deferred.

5. The Fund had $5,380 of straddle losses which were deferred.

6. During the fiscal year ended December 31, 2004, the Fund utilized $1,200,449
of capital loss carryforward to offset capital gains realized in that fiscal
year.

7. During the fiscal year ended December 31, 2003, the Fund utilized $666,406 of
capital loss carryforward to offset capital gains realized in that fiscal year.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

            INCREASE TO              INCREASE TO ACCUMULATED
            ACCUMULATED NET                NET REALIZED LOSS
            INVESTMENT INCOME                 ON INVESTMENTS
            ------------------------------------------------
            $8,933,001                            $8,933,001

The tax character of distributions paid during the years ended December 31, 2004
and December 31, 2003 was as follows:

                                              YEAR ENDED           YEAR ENDED
                                       DECEMBER 31, 2004    DECEMBER 31, 2003
            -----------------------------------------------------------------
            Distributions paid from:
            Ordinary income                  $34,517,360          $29,315,384


            38 | OPPENHEIMER STRATEGIC BOND FUND/VA


The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

            Federal tax cost of securities                  $  875,097,377
            Federal tax cost of other investments              (35,019,525)
                                                            ---------------
            Total federal tax cost                          $  840,077,852
                                                            ===============

            Gross unrealized appreciation                   $   61,496,783
            Gross unrealized depreciation                      (17,143,136)
                                                            ---------------
            Net unrealized appreciation                     $   44,353,647
                                                            ===============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.



- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.


            39 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:



                                            YEAR ENDED DECEMBER 31, 2004    YEAR ENDED DECEMBER 31, 2003
                                                 SHARES           AMOUNT         SHARES           AMOUNT
- ---------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                         24,003,073    $ 119,433,508     46,663,574    $ 222,213,838
Dividends and/or distributions reinvested     6,088,351       29,467,620      6,471,166       28,473,133
Redeemed                                    (25,208,632)    (125,399,423)   (28,764,717)    (134,878,868)
                                            -------------------------------------------------------------
Net increase                                  4,882,792    $  23,501,705     24,370,023    $ 115,808,103
                                            =============================================================

- ---------------------------------------------------------------------------------------------------------
SERVICE SHARES
Sold                                         31,450,838    $ 158,302,695     14,341,848    $  69,419,263
Dividends and/or distributions reinvested     1,026,369        5,049,740        187,166          842,251
Redeemed                                     (2,125,979)     (10,581,099)      (725,688)      (3,507,540)
                                            -------------------------------------------------------------
Net increase                                 30,351,228    $ 152,771,336     13,803,326    $  66,753,974
                                            =============================================================


- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than U.S. government obligations and short-term obligations, for the year ended
December 31, 2004, were $461,469,057 and $348,803,252, respectively. There were
purchases of $188,816,133 and sales of $149,557,330 of U.S. government and
government agency obligations for the year ended December 31, 2004. In addition,
there were purchases of $959,649,113 and sales of $973,488,511 of To Be
Announced (TBA) mortgage-related securities for the year ended December 31,
2004.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% on the next $200 million and 0.50% of average annual
net assets over $1 billion.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended December 31, 2004, the Fund paid
$20,075 to OFS for services to the Fund.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 per class for class level assets of $10
million or more. Each class is subject to the minimum fee in the event that the
per account fee does not equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc. (the Distributor), for distribution related services and
personal service and account maintenance for the Fund's Service shares. Under
the Plan, payments are made quarterly at an annual rate of up to 0.25% of the
average annual net assets of Service shares of the Fund. The Distributor
currently uses all of those fees to compensate sponsor(s) of the insurance
product that offers Fund shares, for providing personal service and maintenance
of accounts of their variable contract owners that hold Service shares. The
impact of the service plan is to increase operating expenses of the Service
shares, which results in lower performance compared to the Fund's shares that
are not subject to a service fee. Fees incurred by the Fund under the Plan are
detailed in the Statement of Operations.


            40 | OPPENHEIMER STRATEGIC BOND FUND/VA


- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees for all classes to 0.35% of average annual
net assets per class. This undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS

A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.

      The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.

      The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.

As of December 31, 2004, the Fund had outstanding foreign currency contracts as
follows:



                                                                         CONTRACT
                                                       EXPIRATION          AMOUNT      VALUATION AS OF     UNREALIZED     UNREALIZED
CONTRACT DESCRIPTION                                        DATES          (000S)        DEC. 31, 2004   APPRECIATION   DEPRECIATION
- ------------------------------------------------------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
Argentine Peso (ARP)                                       2/2/05           3,375ARP   $     1,135,426   $     34,140   $         --
Australian Dollar (AUD)                                   1/21/05           3,700AUD         2,895,042         98,582             --
Brazilian Real (BRR)                               1/24/05-1/5/10          16,613BRR         6,773,392        692,000             --
British Pound Sterling (GBP)                              1/21/05           1,500GBP         2,875,473             --         15,027
Chilean Peso (CLP)                                        1/21/05         544,448CLP           979,661         39,661             --
Columbian Peso (COP)                               1/7/05-1/24/05       4,071,671COP         1,727,121         27,903             --
Czech Koruna (CZK)                                        4/22/05          31,700CZK         1,419,803        154,814             --
Euro (EUR)                                          3/2/05-4/1/05           9,390EUR        12,773,224        233,897             --
Indian Rupee (INR)                               11/9/05-12/20/05          43,280INR           983,430         23,106             --
Japanese Yen (JPY)                                3/15/05-3/31/05       4,184,500JPY        41,064,379      1,867,755             --
Mexican Nuevo Peso (MXN)                                   1/6/05          10,620MXN           951,676            318             --
New Zealand Dollar (NZD)                                  1/21/05           3,970NZD         2,860,055         49,295             --
Russian Ruble (RUR)                                      10/27/05          28,475RUR         1,012,819         37,314             --
Slovakia Koruna (SKK)                             2/18/05-3/21/05          57,110SKK         2,001,271         93,090             --
South Korean Won (KRW)                                    2/23/05         518,170KRW           499,985         12,983             --
Swedish Krona (SEK)                                       2/16/05          23,690SEK         3,566,562        150,891             --
Turkish Lira (TRL)                                       12/18/07           1,166TRL         1,163,905             --          2,443
                                                                                                         ---------------------------
                                                                                                            3,515,749         17,470
                                                                                                         ---------------------------
CONTRACTS TO SELL
Australian Dollar (AUD)                                    3/2/05           8,730AUD         6,810,313             --         81,851
Brazilian Real (BRR)                                       1/4/05             945BRR           355,262             --          5,355
British Pound Sterling (GBP)                        5/9/05-6/8/05           6,060GBP        11,544,808         24,843        425,528
Canadian Dollar (CAD)                                     2/24/05             330CAD           275,352             --         22,620
Columbian Peso (COP)                                      1/18/05       1,225,560COP           519,901             --          3,876
Euro (EUR)                                        2/18/05-6/08/05          37,815EUR        51,431,155             --      2,324,724
Japanese Yen (JPY)                                 1/20/05-6/8/05         955,800JPY         9,394,115             --        114,371
Norwegian Krone (NOK)                             1/20/05-2/16/05          38,300NOK         6,327,058             --        179,124
Swiss Franc (CHF)                                  1/20/05-4/1/05           7,590CHF         7,012,995             --         60,910
Turkish Lira (TRL)                                        6/21/05   1,760,669,590TRL         1,207,819             --         41,471
                                                                                                         ---------------------------
                                                                                                               24,843      3,259,830
                                                                                                         ---------------------------
Total unrealized appreciation and depreciation                                                           $  3,540,592   $  3,277,300
                                                                                                         ===========================



            41 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
6. FUTURES CONTRACTS

A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures) or debt securities (interest rate futures) in order to gain
exposure to or protection from changes in market value of stocks and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.

      The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it may
be more efficient or cost effective than actually buying securities.

      Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.

      Cash held by the broker to cover initial margin requirements on open
futures contracts is noted in the Statement of Assets and Liabilities.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable and/or payable for the
daily mark to market for variation margin. Realized gains and losses are
reported in the Statement of Operations as the closing and expiration of futures
contracts. The net change in unrealized appreciation and depreciation is
reported in the Statement of Operations.

      Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.

As of December 31, 2004, the Fund had outstanding futures contracts as follows:



                                                                                       UNREALIZED
                                      EXPIRATION   NUMBER OF     VALUATION AS OF     APPRECIATION
CONTRACT DESCRIPTION                       DATES   CONTRACTS   DECEMBER 31, 2004   (DEPRECIATION)
- --------------------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
Japan (Government of) Bonds, 10 yr       3/10/05           1   $       1,350,249   $       (6,325)
NASDAQ 100 Index                         3/17/05          17           2,768,450           42,521
U.S. Long Bonds                          3/21/05         205          23,062,500           19,355
U.S. Treasury Nts., 10 yr                3/21/05         132          14,775,750           62,360
United Kingdom Long Gilt                 3/29/05           3             642,553            4,089
                                                                                   ---------------
                                                                                          122,000
                                                                                   ---------------
CONTRACTS TO SELL
CAC-40 10 Index                          3/18/05          22           1,144,556            2,698
DAX Index                                3/18/05           4             580,671           (1,326)
Euro-Bundesobligation                     3/8/05          13           2,095,514           13,355
FTSE 100 Index                           3/18/05          27           2,486,897          (31,159)
Japan (Government of) Bonds, 10 yr        3/9/05           5             675,222              927
Japan (Government of) Bonds, 10 yr       3/10/05           6           8,101,493            2,928
Nikkei 225 Index                         3/10/05          11           1,232,361          (72,997)
Standard & Poor's 500 Index              3/17/05          36          10,923,300         (157,363)
U.S. Long Bonds                          3/21/05         124          13,950,000          (29,185)
U.S. Treasury Nts., 2 yr                 3/31/05          70          14,671,563            4,242
U.S. Treasury Nts., 5 yr                 3/21/05         106          11,610,313          (63,909)
                                                                                   ---------------
                                                                                         (331,789)
                                                                                   ---------------
                                                                                   $     (209,789)
                                                                                   ===============



            42 | OPPENHEIMER STRATEGIC BOND FUND/VA


- --------------------------------------------------------------------------------
7. OPTION ACTIVITY

The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.

      The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.

      Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.

      Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Contracts subject to call, expiration
date, exercise price, premium received and market value are detailed in a note
to the Statement of Investments. Options written are reported as a liability in
the Statement of Assets and Liabilities. Realized gains and losses are reported
in the Statement of Operations.

      The risk in writing a call option is that the Fund gives up the
opportunity for profit if the market price of the security increases and the
option is exercised. The risk in writing a put option is that the Fund may incur
a loss if the market price of the security decreases and the option is
exercised. The risk in buying an option is that the Fund pays a premium whether
or not the option is exercised. The Fund also has the additional risk of not
being able to enter into a closing transaction if a liquid secondary market does
not exist.

Written option activity for the year ended December 31, 2004 was as follows:



                                                             CALL OPTIONS                    PUT OPTIONS
                                              ---------------------------    ----------------------------
                                                  PRINCIPAL/                     PRINCIPAL/
                                                   NUMBER OF    AMOUNT OF         NUMBER OF    AMOUNT OF
                                                   CONTRACTS     PREMIUMS         CONTRACTS     PREMIUMS
- ---------------------------------------------------------------------------------------------------------

Options outstanding as of December 31, 2003        9,765,000    $ 128,130       744,000,000    $ 138,880
Options written                                2,225,002,170      165,903       722,325,000      105,898
Options closed or expired                     (2,231,511,225)    (253,965)   (1,464,000,000)    (239,421)
Options exercised                                 (3,255,000)     (37,407)               --           --
                                              -----------------------------------------------------------
Options outstanding as of December 31, 2004              945    $   2,661         2,325,000    $   5,357
                                              ===========================================================


- --------------------------------------------------------------------------------
8. CREDIT SWAP CONTRACTS

The Fund may enter into a credit swap transaction to maintain a total return on
a particular investment or portion of its portfolio, or for other
non-speculative purposes. Because the principal amount is not exchanged, it
represents neither an asset nor a liability to either counterparty, and is
referred to as a notional principal amount. The Fund records an increase or
decrease to unrealized gain (loss), in the amount due to or owed by the Fund at
termination or settlement. Credit swaps are subject to credit risks (if the
counterparty fails to meet its obligations). The Fund pays an annual interest
fee on the notional amount in exchange for the counterparty paying in a
potential credit event.


            43 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
8. CREDIT SWAP CONTRACTS Continued

During the year ended December 31, 2004, the Fund entered into transactions to
hedge credit risk. Information regarding the credit swaps is as follows:



                                                                                                         UNREALIZED
                                                     EXPIRATION       NOTIONAL     VALUATION AS OF      APPRECIATION
CONTRACT DESCRIPTION                                      DATES         AMOUNT   DECEMBER 31, 2004    (DEPRECIATION)
- ---------------------------------------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
Citigroup Global Markets Ltd.,
Venezuela (Republic of) Credit Nts.                    11/20/09    $ 6,350,000   $        (257,398)   $     (257,398)
Deutsche Bank AG:
Export-Import Bank of Korea Credit Bonds                6/20/09        780,000             (10,452)          (10,452)
Korea Deposit Insurance Corp. Credit Bonds              6/20/09        780,000             (10,374)          (10,374)
Korea Development Bank Credit Bonds                     6/20/09        780,000             (10,140)          (10,140)
Korea Electric Power Corp. Credit Bonds                 6/20/09        780,000             (10,686)          (10,686)
Philippines (Republic of) 10 yr. Credit Bonds           7/25/13        930,000              26,435            26,435
Samsung Electronic Co. Ltd. Credit Bonds                6/20/09        780,000              (9,828)           (9,828)
United Mexican States Credit Bonds                      9/20/13      1,235,000             (80,794)          (80,794)
Venezuela (Republic of) Credit Bonds                   10/20/09      4,715,000            (311,128)         (311,128)
JPMorgan Chase Bank:
Export-Import Bank of Korea Credit Bonds                6/20/09        390,000              (8,522)           (8,522)
Jordan (Kingdom of) Credit Nts.                          6/6/06        250,000                (752)             (752)
Korea Deposit Insurance Corp. Credit Bonds              6/20/09        390,000              (8,374)           (8,374)
Korea Development Bank Credit Bonds                     6/20/09        390,000              (8,358)           (8,358)
Korea Electric Power Co. Credit Bonds                   6/20/09        390,000              (8,942)           (8,942)
Russian Federation Credit Bonds                         10/9/13        730,000             (41,855)          (41,855)
Samsung Electronics Co. Ltd. Credit Bonds               6/20/09        390,000              (8,457)           (8,457)
Lehman Brothers Special Financing, Inc.:
Brazil (Federal Republic of) Credit Bonds               8/20/09      3,000,000            (464,999)         (464,999)
Turkey (Republic of) Credit Bonds                      11/11/09      1,850,000              (7,189)           (7,189)
Morgan Stanley Capital Services, Inc.:
Brazil (Federal Republic of) Credit Bonds               8/20/09      2,440,000            (377,069)         (377,069)
Hungary (Republic of) Credit Bonds                      12/2/13      1,880,000             (41,014)          (41,014)
Panama (Republic of) Credit Bonds                      11/20/14      1,730,000            (106,672)         (106,672)
Philippines (Republic of) Credit Bonds                  6/20/09      1,135,000             (17,102)          (17,102)
Philippines (Republic of) 5 yr. Credit Bonds            9/20/09        950,000              (5,696)           (5,696)
Venezuela (Republic of) Credit Bonds            8/20/06-2/20/14      5,050,000            (437,023)         (437,023)
UBS AG:
Brazil (Federal Republic of)
Credit Bonds                                           10/20/09        900,000             (65,111)          (65,111)
Russian Federation Credit Bonds                 11/2/14-11/5/14      3,825,000            (163,083)         (163,083)
Venezuela (Republic of) Credit Bonds            8/20/06-6/20/14      5,685,000            (798,858)         (798,858)
                                                                                                      ---------------
                                                                                                      $   (3,243,441)
                                                                                                      ===============


- --------------------------------------------------------------------------------
9. INTEREST RATE SWAP CONTRACTS

The Fund may enter into an interest rate swap transaction to maintain a total
return or yield spread on a particular investment, or portion of its portfolio,
or for other non-speculative purposes. Interest rate swaps involve the exchange
of commitments to pay or receive interest, e.g., an exchange of floating rate
payments for fixed rate payments. The coupon payments are based on an agreed
upon principal amount and a specified index. Because the principal amount is not
exchanged, it represents neither an asset nor a liability to either
counterparty, and is referred to as notional. The Fund records an increase or
decrease to unrealized gain (loss), in the amount due to or owed by the Fund at
termination or settlement.

      Interest rate swaps are subject to credit risk (if the counterparty fails
to meet its obligations) and interest rate risk. The Fund could be obligated to
pay more under its swap agreements than it receives under them, as a result of
interest rate changes.


            44 | OPPENHEIMER STRATEGIC BOND FUND/VA


As of December 31, 2004, the Fund had entered into the following interest rate
swap agreements:



                                             FIXED RATE   FLOATING RATE
                                                PAID BY     RECEIVED BY                                    UNREALIZED
                            NOTIONAL        THE FUND AT     THE FUND AT      FLOATING   TERMINATION      APPRECIATION
SWAP COUNTERPARTY             AMOUNT      DEC. 31, 2004   DEC. 31, 2004    RATE INDEX         DATES    (DEPRECIATION)
- ----------------------------------------------------------------------------------------------------------------------

Deutsche Bank AG          74,350,000INR            4.88%           4.50%          IRS       1/15/09    $       66,467
                                                                          Three-Month
Deutsche Bank AG           3,185,000             3.1025            1.82    LIBOR flat        3/4/08            32,431
Deutsche Bank AG          55,240,000              2.585            1.04   90-day CPTW       8/19/09            (1,061)
                                                                          Three-Month
Deutsche Bank AG          10,000,000            2.27625            5.32     LIBOR BBA       5/12/14           582,127
                                                                            Six-Month
JPMorgan Chase Bank          880,000EUR           3.135            2.081   LIBOR flat       7/14/08           (13,503)
                                                                            Six-Month
JPMorgan Chase Bank      245,400,000HUF            9.13            7.00    LIBOR flat       7/14/08           (74,862)
                                                                               28 Day
JPMorgan Chase Bank       14,620,000MXN            9.10           10.88      MXN TIIE      11/16/14            16,172
                                                                          Three-Month
JPMorgan Chase Bank        6,625,000              3.052            1.86    LIBOR flat       3/10/08           111,767
                                                                          Three-Month
JPMorgan Chase Bank       50,000,000               2.21          4.0725     LIBOR BBA        5/6/09           417,937
                                                                          Three-Month
JPMorgan Chase Bank       35,000,000               1.70           4.985     LIBOR BBA        5/6/14         1,144,347
                                                                          Three-Month
JPMorgan Chase Bank       25,000,000               4.24            1.65         LIBOR       7/23/09          (648,784)
                                                                          Three-Month
JPMorgan Chase Bank        1,820,000               2.13            4.94     LIBOR BBA       4/30/14            55,137
Morgan Stanley Capital                                                    Three-Month
Services, Inc.            13,000,000               3.82            2.26    LIBOR flat      11/10/08           (27,411)
Morgan Stanley Capital                                                    Three-Month
Services, Inc.            22,000,000               2.32            1.71    LIBOR flat      11/10/05           124,174
                                                                                                       ---------------
                                                                                                       $    1,784,938
                                                                                                       ===============


Notional amount is reported in U.S. Dollars, except for those denoted in the
following currencies. Index abbreviations and currencies are as follows:

EUR         Euro
HUF         Hungarian Forint
INR         Indian Rupee
MXN         Mexican Nuevo Peso
BBA         British Bankers Association
CPTW        Bloomberg Taiwan Secondary Commercial Papers
IRS         India Swap Composites
LIBOR       London-Interbank Offered Rate
LIBOR BBA   London-Interbank Offered Rate British Bankers Association
TIIE        Interbank Equilibrium Interest Rate

- --------------------------------------------------------------------------------
10. SWAPTION TRANSACTIONS

The Fund may enter into a swaption transaction, whereby a contract that grants
the holder, in return for payment of the purchase price (the "premium") of the
option, the right, but not the obligation, to enter into an interest rate swap
at a preset rate within a specified period of time, with the writer of the
contract. The writer receives premiums and bears the risk of unfavorable changes
in the preset rate on the underlying interest rate swap. Swaption contracts
written by the Fund do not give rise to counterparty credit risk as they
obligate the Fund, not its counterparty, to perform. Swaptions written are
reported as a liability in the Statement of Assets and Liabilities.


            45 | OPPENHEIMER STRATEGIC BOND FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
10. SWAPTION TRANSACTIONS Continued

Written swaption activity for the year ended December 31, 2004 was as follows:



                                                          CALL SWAPTIONS               PUT SWAPTIONS
                                                ------------------------    -------------------------
                                                   NOTIONAL    AMOUNT OF       NOTIONAL    AMOUNT OF
                                                     AMOUNT     PREMIUMS         AMOUNT     PREMIUMS
- -----------------------------------------------------------------------------------------------------

Swaptions outstanding as of December 31, 2003            --    $      --      2,220,000    $  19,758
Swaptions written                                22,660,000      240,122     19,060,000       77,390
Swaptions closed or expired                     (15,990,000)    (174,120)   (10,820,000)     (48,930)
Swaptions exercised                                      --           --     (2,220,000)     (19,758)
                                                -----------------------------------------------------
Swaptions outstanding as of December 31, 2004     6,670,000    $  66,002      8,240,000    $  28,460
                                                =====================================================


As of December 31, 2004, the Fund had entered into the following swaption
contracts:



                               NOTIONAL      EXPIRATION    EXERCISE        PREMIUM         VALUE
SWAPTIONS                        AMOUNT           DATES        RATE       RECEIVED    SEE NOTE 1
- ------------------------------------------------------------------------------------------------

British Pound Sterling Call   6,670,000GBP      3/29/05       4.792%GBP   $ 66,002    $   49,504
Deutsche Bank AG Put          8,240,000AUD       2/3/05       5.685%AUD     28,460        21,365
                                                                          ----------------------
                                                                          $ 94,462    $   70,869
                                                                          ======================


Notional amount and exercise price are denoted in the following currencies:

AUD         Australian Dollar
GBP         British Pound Sterling

- --------------------------------------------------------------------------------
11. ILLIQUID OR RESTRICTED SECURITIES AND CURRENCY

As of December 31, 2004, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 15% of
its net assets (determined at the time of purchase and reviewed periodically) in
illiquid or restricted securities. Certain restricted securities, eligible for
resale to qualified institutional investors, are not subject to that limitation.
Information concerning restricted securities and currency is as follows:



                                                            ACQUISITION                  VALUATION AS OF      UNREALIZED
SECURITY                                                          DATES        COST    DECEMBER 31, 2004    DEPRECIATION
- ------------------------------------------------------------------------------------------------------------------------

Geotek Communications, Inc., Series B, Escrow Shares             1/4/01    $    840             $     --        $    840
Prandium, Inc.                                          3/19/99-9/25/02     284,000                  266         283,734

CURRENCY
Argentine Peso                                                  6/25/04      70,732               70,392             340


- --------------------------------------------------------------------------------
12. SECURITIES LENDING

The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of US
Treasury obligations or cash, against the loaned securities and maintains
collateral in an amount not less than 100% of the market value of the loaned
securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the funds and any
additional required collateral is delivered to the Fund on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Fund could experience delays and
cost in recovering the securities loaned or in gaining access to the collateral.
Cash collateral is invested in cash equivalents. The Fund retains a portion of
the interest earned from the collateral. The Fund also continues to receive
interest or dividends paid on the securities loaned. As of December 31, 2004,
the Fund had on loan securities valued at $44,013,349. Cash of $44,858,831 was
received as collateral for the loans, of which $14,877,998 was invested in
approved instruments.


            46 | OPPENHEIMER STRATEGIC BOND FUND/VA


- --------------------------------------------------------------------------------
13. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.

- --------------------------------------------------------------------------------
5. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER VALUE FUND/VA:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Value Fund/VA, a series of Oppenheimer Variable Account Funds,
including the statement of investments, as of December 31, 2004, and the related
statement of operations for the year then ended, the statements of changes in
net assets for the year then ended and the period from January 2, 2003
(commencement of operations) to December 31, 2003, and the financial highlights
for the periods presented. 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 the standards of the Public
Company Accounting Oversight Board (United States). 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 consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Fund's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 2004, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
Additionally, an audit 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, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Value Fund/VA as of December 31, 2004, the results of its operations
for the year then ended, the changes in its net assets for the year then ended
and the period from January 2, 2003 (commencement of operations) to December 31,
2003, and the financial highlights for the periods presented, in conformity with
accounting principles generally accepted in the United States of America.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP

Denver, Colorado
February 11, 2005

STATEMENT OF INVESTMENTS  December 31, 2004
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                          SHARES     SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--113.6%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--11.0%
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--1.2%
McDonald's Corp.                                           1,030   $      33,022
- --------------------------------------------------------------------------------
MEDIA--9.8%
Liberty Media Corp., Cl. A 1                              11,740         128,905
- --------------------------------------------------------------------------------
UnitedGlobalCom, Inc., Cl. A 1                            15,310         147,895
                                                                   -------------
                                                                         276,800

- --------------------------------------------------------------------------------
CONSUMER STAPLES--6.6%
- --------------------------------------------------------------------------------
TOBACCO--6.6%
Altria Group, Inc.                                         3,040         185,744
- --------------------------------------------------------------------------------
ENERGY--10.7%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & Services--1.7%
Halliburton Co.                                            1,240          48,658
- --------------------------------------------------------------------------------
OIL & GAS--9.0%
BP plc, ADR                                                2,720         158,848
- --------------------------------------------------------------------------------
Kinder Morgan, Inc.                                          330          24,133
- --------------------------------------------------------------------------------
LUKOIL, Sponsored ADR                                        300          36,750
- --------------------------------------------------------------------------------
Petroleo Brasileiro SA, ADR                                  800          31,824
                                                                   -------------
                                                                         251,555

- --------------------------------------------------------------------------------
FINANCIALS--29.7%
- --------------------------------------------------------------------------------
COMMERCIAL BANKS--8.5%
Bank of America Corp.                                      2,988         140,406
- --------------------------------------------------------------------------------
Wells Fargo & Co.                                          1,570          97,576
                                                                   -------------
                                                                         237,982

- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--14.0%
Citigroup, Inc.                                            3,330         160,439
- --------------------------------------------------------------------------------
Franklin Resources, Inc.                                   1,490         103,779
- --------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.                             1,500         131,220
                                                                   -------------
                                                                         395,438

- --------------------------------------------------------------------------------
INSURANCE--4.4%
Genworth Financial, Inc., Cl. A                              550          14,850
- --------------------------------------------------------------------------------
Platinum Underwriters Holdings Ltd.                          800          24,880
- --------------------------------------------------------------------------------
Prudential Financial, Inc.                                 1,540          84,638
                                                                   -------------
                                                                         124,368

- --------------------------------------------------------------------------------
THRIFTS & MORTGAGE FINANCE--2.8%
Countrywide Financial Corp.                                  700          25,907
- --------------------------------------------------------------------------------
Freddie Mac                                                  710          52,327
                                                                   -------------
                                                                          78,234

- --------------------------------------------------------------------------------
HEALTH CARE--3.1%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--2.5%
Wyeth                                                      1,650          70,274
- --------------------------------------------------------------------------------
PHARMACEUTICALS--0.6%
Pfizer, Inc.                                                 600          16,134


                                                                          VALUE
                                                          SHARES     SEE NOTE 1
- --------------------------------------------------------------------------------
INDUSTRIALS--23.3%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--11.1%
Empresa Brasileira de Aeronautica
SA, ADR                                                    1,770   $      59,189
- --------------------------------------------------------------------------------
Honeywell International, Inc.                              4,200         148,722
- --------------------------------------------------------------------------------
Raytheon Co.                                               2,710         105,229
                                                                   -------------
                                                                         313,140

- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & Supplies--5.0%
Cendant Corp.                                              5,990         140,046
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--7.2%
General Electric Co.                                       3,440         125,560
- --------------------------------------------------------------------------------
Tyco International Ltd.                                    2,180          77,913
                                                                   -------------
                                                                         203,473

- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--13.4%
- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--5.8%
International Business Machines Corp.                      1,670         164,629
- --------------------------------------------------------------------------------
SOFTWARE--7.6%
Compuware Corp. 1                                          2,900          18,763
- --------------------------------------------------------------------------------
Microsoft Corp.                                            1,200          32,052
- --------------------------------------------------------------------------------
Novell, Inc. 1                                             4,800          32,400
- --------------------------------------------------------------------------------
Synopsys, Inc. 1                                           1,400          27,468
- --------------------------------------------------------------------------------
Take-Two Interactive Software, Inc. 1                      2,960         102,978
                                                                   -------------
                                                                         213,661

- --------------------------------------------------------------------------------
MATERIALS--5.0%
- --------------------------------------------------------------------------------
CHEMICALS--2.4%
Praxair, Inc.                                              1,490          65,784
- --------------------------------------------------------------------------------
METALS & MINING--2.6%
Alcan, Inc.                                                  300          14,712
- --------------------------------------------------------------------------------
Inco Ltd. 1                                                1,060          38,987
- --------------------------------------------------------------------------------
Phelps Dodge Corp.                                           200          19,784
                                                                   -------------
                                                                          73,483

- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--4.6%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--4.6%
IDT Corp., Cl.B 1                                          4,280          66,254
- --------------------------------------------------------------------------------
Verizon Communications, Inc.                               1,580          64,006
                                                                   -------------
                                                                         130,260

- --------------------------------------------------------------------------------
UTILITIES--6.2%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--4.9%
AES Corp. (The) 1                                          7,040          96,237
- --------------------------------------------------------------------------------
PG&E Corp. 1                                                 980          32,614
- --------------------------------------------------------------------------------
Reliant Energy, Inc. 1                                       700           9,553
                                                                   -------------
                                                                         138,404


            7 | OPPENHEIMER VALUE FUND/VA


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                          SHARES     SEE NOTE 1
- --------------------------------------------------------------------------------
GAS UTILITIES--1.3%
Sempra Energy                                                970   $     35,580

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE

(COST $2,513,881)                                          113.6%     3,196,669
- --------------------------------------------------------------------------------
LIABILITIES IN EXCESS
OF OTHER ASSETS                                            (13.6)      (382,139)
                                                    ----------------------------
NET ASSETS                                                 100.0%  $  2,814,530
                                                    ============================

FOOTNOTE TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            8 | OPPENHEIMER VALUE FUND/VA


STATEMENT OF ASSETS AND LIABILITIES  December 31, 2004
- --------------------------------------------------------------------------------



- -------------------------------------------------------------------------------------------------------
ASSETS
- -------------------------------------------------------------------------------------------------------
Investments, at value (cost $2,513,881)--see accompanying statement of investments     $     3,196,669
- -------------------------------------------------------------------------------------------------------
Cash                                                                                           119,161
- -------------------------------------------------------------------------------------------------------
Receivables and other assets:
Dividends                                                                                        4,664
Other                                                                                            1,477
                                                                                       ----------------
Total assets                                                                                 3,321,971

- -------------------------------------------------------------------------------------------------------
LIABILITIES
- -------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Dividends                                                                                      459,831
Investments purchased                                                                           26,088
Shareholder communications                                                                       6,203
Trustees' compensation                                                                           2,640
Other                                                                                           12,679
                                                                                       ----------------
Total liabilities                                                                              507,441

- -------------------------------------------------------------------------------------------------------
NET ASSETS                                                                             $     2,814,530
                                                                                       ================

- -------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- -------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                             $           230
- -------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                   2,132,982
- -------------------------------------------------------------------------------------------------------
Accumulated net investment loss                                                                 (1,470)
- -------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments                                                     682,788
                                                                                       ----------------
NET ASSETS--applicable to 229,559 shares of beneficial interest outstanding            $     2,814,530
                                                                                       ================

- -------------------------------------------------------------------------------------------------------
NET ASSET VALUE, REDEMPTION PRICE PER SHARE AND OFFERING PRICE PER SHARE               $         12.26


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            9 | OPPENHEIMER VALUE FUND/VA


STATEMENT OF OPERATIONS  For the Year Ended December 31, 2004
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $564)                $    57,968
- --------------------------------------------------------------------------------
Interest                                                                    811
                                                                    ------------
Total investment income                                                  58,779

- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees                                                          25,294
- --------------------------------------------------------------------------------
Legal, auditing and other professional fees                              17,638
- --------------------------------------------------------------------------------
Shareholder communications                                                8,574
- --------------------------------------------------------------------------------
Trustees' compensation                                                    4,669
- --------------------------------------------------------------------------------
Custodian fees and expenses                                                  73
- --------------------------------------------------------------------------------
Other                                                                     5,289
                                                                    ------------
Total expenses                                                           61,537
Less reduction to custodian expenses                                        (11)
                                                                    ------------
Net expenses                                                             61,526

- --------------------------------------------------------------------------------
NET INVESTMENT LOSS                                                      (2,747)

- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain on investments                                        462,480
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on investments                    (56,226)

- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                $   403,507
                                                                    ============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            10 | OPPENHEIMER VALUE FUND/VA


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------



YEAR ENDED DECEMBER 31,                                                             2004             2003 1
- -----------------------------------------------------------------------------------------------------------

OPERATIONS
- -----------------------------------------------------------------------------------------------------------
Net investment income (loss)                                              $       (2,747)    $        8,769
- -----------------------------------------------------------------------------------------------------------
Net realized gain                                                                462,480            123,023
- -----------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)                             (56,226)           739,014
                                                                          ---------------------------------
Net increase in net assets resulting from operations                             403,507            870,806

- -----------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- -----------------------------------------------------------------------------------------------------------
Dividends from net investment income--Non-Service shares                         (10,068)                --
- -----------------------------------------------------------------------------------------------------------
Distributions from net realized gain--Non-Service shares                        (584,853)                --

- -----------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- -----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest
  transactions--Non-Service shares                                              (864,862)         3,000,000

- -----------------------------------------------------------------------------------------------------------
NET ASSETS
- -----------------------------------------------------------------------------------------------------------
Total increase (decrease)                                                     (1,056,276)         3,870,806
- -----------------------------------------------------------------------------------------------------------
Beginning of period                                                            3,870,806                 --
                                                                          ---------------------------------
End of period (including accumulated net investment income (loss) of
 $(1,470) and $8,769, respectively)                                       $    2,814,530     $    3,870,806
                                                                          =================================


1. For the period from January 2, 2003 (commencement of operations) to December
31, 2003.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            11 | OPPENHEIMER VALUE FUND/VA


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------



NON-SERVICE SHARES  YEAR ENDED DECEMBER 31,                                         2004             2003 1
- --------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $        12.90     $        10.00
- --------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                                        (.01) 2             .03
Net realized and unrealized gain                                                    1.82               2.87
                                                                          ------------------------------------
Total from investment operations                                                    1.81               2.90
- --------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                                (.03)                --
Distributions from net realized gain                                               (2.42)                --
                                                                          ------------------------------------
Total dividends and/or distributions
to shareholders                                                                    (2.45)                --
- --------------------------------------------------------------------------------------------------------------
Net asset value, end of period                                            $        12.26     $        12.90
                                                                          ====================================

- --------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                                 14.50%             29.00%
- --------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $        2,815     $        3,871
- --------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $        3,370     $        3,205
- --------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss)                                                       (0.08)%             0.27%
Total expenses                                                                      1.82% 5            1.39% 5
- --------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                              100%               120%


1. For the period from January 2, 2003 (commencement of operations) to December
31, 2003.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions 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 are not annualized for
periods less than one full year. Total return information does not reflect
expenses that apply at the separate account level or to related insurance
products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            12 | OPPENHEIMER VALUE FUND/VA


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Value Fund/VA (the Fund) is a separate series of Oppenheimer
Variable Account Funds (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek long-term growth of capital by investing
primarily in common stocks with low price-earnings ratios and
better-than-anticipated earnings. The Trust's investment advisor is
OppenheimerFunds, Inc. (the Manager). As of December 31, 2004, the majority of
the Non-Service shares were owned by the Manager.

      The Fund currently offers Non-Service shares only. The class is sold at
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other investment
products.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic or foreign exchanges are
valued based on the last sale price of the security traded on that exchange
prior to the time when the Fund's assets are valued. Securities traded on NASDAQ
are valued based on the closing price provided by NASDAQ prior to the time when
the Fund's assets are valued. In the absence of a sale, the security is valued
at the last sale price on the prior trading day, if it is within the spread of
the closing bid and asked prices, and if not, at the closing bid price.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of 60 days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Securities may be valued primarily
using dealer-supplied valuations or a portfolio pricing service authorized by
the Board of Trustees. Securities (including restricted securities) for which
market quotations are not readily available are valued at their fair value.
Foreign and domestic securities whose values have been materially affected by
what the Manager identifies as a significant event occurring before the Fund's
assets are valued but after the close of their respective exchanges will be fair
valued. Fair value is determined in good faith using consistently applied
procedures under the supervision of the Board of Trustees. Short-term "money
market type" debt securities with remaining maturities of sixty days or less are
valued at amortized cost (which approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. Amounts related to the purchase and sale of foreign securities and
investment income are translated at the rates of exchange prevailing on the
respective dates of such transactions. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities


            13 | OPPENHEIMER VALUE FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

pledged as collateral for repurchase agreements are held by a custodian bank
until the agreements mature. Each agreement requires that the market value of
the collateral be sufficient to cover payments of interest and principal. In the
event of default by the other party to the agreement, retention of the
collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders. Therefore, no federal income or excise tax provisions are
required, however, during the year ended December 31, 2004, the Fund paid
federal excise tax of $1,754.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                            NET UNREALIZED
                                                              APPRECIATION
                                                          BASED ON COST OF
                                                            SECURITIES AND
      UNDISTRIBUTED     UNDISTRIBUTED    ACCUMULATED     OTHER INVESTMENTS
      NET INVESTMENT        LONG-TERM           LOSS    FOR FEDERAL INCOME
      INCOME                     GAIN   CARRYFORWARD          TAX PURPOSES
      --------------------------------------------------------------------
      $--                         $--            $--              $682,788

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for December 31, 2004. Net assets of
the Fund were unaffected by the reclassifications.

                                                         REDUCTION TO
                                   REDUCTION TO       ACCUMULATED NET
              REDUCTION TO      ACCUMULATED NET         REALIZED GAIN
              PAID-IN CAPITAL   INVESTMENT LOSS        ON INVESTMENTS
              -------------------------------------------------------
              $1,926                     $2,576                  $650

The tax character of distributions paid during the year ended December 31, 2004
and the period ended December 31, 2003 was as follows:

                                        YEAR ENDED              PERIOD ENDED
                                 DECEMBER 31, 2004       DECEMBER 31, 2003 1
- ----------------------------------------------------------------------------
Distributions paid from:
Ordinary income                         $  305,198                       $--
Long-term capital gain                     289,723                        --
                                 -------------------------------------------
Total                                     $594,921                       $--
                                 ===========================================

1. For the period from January 2, 2003 (commencement of operations) to December
31, 2003.

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of December 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.


            14 | OPPENHEIMER VALUE FUND/VA


Federal tax cost of securities                 $  2,513,881
                                               =============
Gross unrealized appreciation                  $    692,064
Gross unrealized depreciation                        (9,276)
                                               -------------
Net unrealized appreciation                    $    682,788
                                               =============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.

- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. 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.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Trust has authorized an unlimited number of $0.001 par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:



                                              YEAR ENDED DECEMBER 31, 2004      PERIOD ENDED DECEMBER 31, 2003 1
                                                  SHARES            AMOUNT              SHARES            AMOUNT
- ----------------------------------------------------------------------------------------------------------------

NON-SERVICE SHARES
Sold                                                  --        $       --             300,000      $  3,000,000
Dividends and/or distributions reinvested         10,679           135,090                  --                --
Redeemed                                         (81,120)         (999,952)                 --                --
                                              ------------------------------------------------------------------
Net increase (decrease)                          (70,441)       $ (864,862)            300,000      $  3,000,000
                                              ==================================================================


1. For the period from January 2, 2003 (commencement of operations) to December
31, 2003.


            15 | OPPENHEIMER VALUE FUND/VA


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended December 31, 2004, were
$3,336,459 and $4,347,469, respectively.

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million and 0.60% of average annual net assets over $800 million.

- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee.

      Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $10,000 for assets of $10 million or more. The Fund
is subject to the minimum fee in the event that the per account fee does not
equal or exceed the applicable minimum fee.

- --------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. OFS has voluntarily agreed to limit transfer
and shareholder servicing agent fees to 0.35% of average annual net assets of
the Fund. This undertaking may be amended or withdrawn at any time.

- --------------------------------------------------------------------------------
5. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor (collectively, the
"Oppenheimer defendants"), as well as 51 of the Oppenheimer funds (as "Nominal
Defendants") excluding the Fund, 31 present and former Directors or Trustees and
9 present and former officers of the funds. This complaint, filed in the U.S.
District Court for the Southern District of New York on January 10, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Oppenheimer defendants believe that the allegations contained in the
Complaints are without merit and that they, the funds named as Nominal
Defendants, and the Directors/Trustees of those funds have meritorious defenses
against the claims asserted. The Oppenheimer defendants intend to defend these
lawsuits vigorously and to contest any claimed liability, and they have retained
legal counsel to defend such suits. The Oppenheimer defendants believe that it
is premature to render any opinion as to the likelihood of an outcome
unfavorable to them and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss.

                                       A-1
                                   Appendix A

                               RATINGS DEFINITIONS

Below are summaries of the rating definitions used by the nationally-recognized
rating agencies listed below. Those ratings represent the opinion of the agency
as to the credit quality of issues that they rate. The summaries below are based
upon publicly available information provided by the rating organizations.

Moody's Investors Service, Inc. ("Moody's")

Long-Term Ratings: Bonds and Preferred Stock Issuer Ratings

Aaa: Bonds and preferred stock rated "Aaa" are judged to be the best quality.
They carry the smallest degree of investment risk. Interest payments are
protected by a large or by an exceptionally stable margin and principal is
secure. While the various protective elements are likely to change, the changes
that can be expected are most unlikely to impair the Fundamentally strong
position of such issues.

Aa: Bonds and preferred stock rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group, they comprise what are generally known
as high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as with "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risk appear somewhat larger than that of "Aaa"
securities.

A: Bonds and preferred stock rated "A" possess many favorable investment
attributes and are to be considered as upper-medium grade obligations. Factors
giving security to principal and interest are considered adequate but elements
may be present which suggest a susceptibility to impairment some time in the
future.

Baa: Bonds and preferred stock rated "Baa" are considered medium-grade
obligations; that is, they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics and have speculative characteristics as well.

Ba: Bonds and preferred stock rated "Ba" are judged to have speculative
elements. Their future cannot be considered well-assured. Often the protection
of interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.

B: Bonds and preferred stock rated "B" generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.

Caa: Bonds and preferred stock rated "Caa" are of poor standing. Such issues may
be in default or there may be present elements of danger with respect to
principal or interest.

Ca: Bonds and preferred stock rated "Ca" represent obligations which are
speculative in a high degree. Such issues are often in default or have other
marked shortcomings.

C: Bonds and preferred stock rated "C" are the lowest class of rated bonds and
can be regarded as having extremely poor prospects of ever attaining any real
investment standing.

Moody's applies numerical modifiers 1, 2, and 3 in each generic rating
classification from "Aa" through "Caa." The modifier "1" indicates that the
obligation ranks in the higher end of its generic rating category; the modifier
"2" indicates a mid-range ranking; and the modifier "3" indicates a ranking in
the lower end of that generic rating category. Advanced refunded issues that are
secured by certain assets are identified with a # symbol.

Prime Rating System (Short-Term Ratings - Taxable Debt) These ratings are
opinions of the ability of issuers to honor senior financial obligations and
contracts. Such obligations generally have an original maturity not exceeding
one year, unless explicitly noted.

Prime-1: Issuer has a superior ability for repayment of senior short-term
debt obligations.

Prime-2: Issuer has a strong ability for repayment of senior short-term debt
obligations. Earnings trends and coverage ratios, while sound, may be more
subject to variation. Capitalization characteristics, while appropriate, may be
more affected by external conditions. Ample alternate liquidity is maintained.

Prime-3: Issuer has an acceptable ability for repayment of senior short-term
obligations. The effect of industry characteristics and market compositions may
be more pronounced. Variability in earnings and profitability may result in
changes in the level of debt protection measurements and may require relatively
high financial leverage. Adequate alternate liquidity is maintained.

Not Prime: Issuer does not fall within any Prime rating category.

Standard & Poor's Ratings Services ("Standard & Poor's"), a division of The
McGraw-Hill Companies, Inc.

Long-Term Issue Credit Ratings
Issue credit ratings are based in varying degrees, on the following
considerations:
o     Likelihood of payment-capacity and willingness of the obligor to meet
      its financial commitment on an obligation in accordance with the terms
      of the obligation;
o     Nature of and provisions of the obligation; and
o     Protection afforded by, and relative position of, the obligation in the
      event of bankruptcy, reorganization, or other arrangement under the laws
      of bankruptcy and other laws affecting creditors' rights.
   The issue ratings definitions are expressed in terms of default risk. As
such, they pertain to senior obligations of an entity. Junior obligations are
typically rated lower than senior obligations, to reflect the lower priority in
bankruptcy, as noted above.

AAA: An obligation  rated "AAA" have the highest rating assigned by Standard &
Poor's.  The  obligor's  capacity  to meet  its  financial  commitment  on the
obligation is extremely strong.

AA: An obligation rated "AA" differ from the highest rated obligations only in
small degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

A: An obligation rated "A" are somewhat more susceptible to the adverse effects
of changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB: An obligation rated "BBB" exhibit adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity of the obligor to meet its financial commitment on the
obligation.

BB, B, CCC, CC, and C
An obligation rated `BB', `B', `CCC', `CC', and `C' are regarded as having
significant speculative characteristics. `BB' indicates the least degree of
speculation and `C' the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.

BB: An obligation rated "BB" are less vulnerable to nonpayment than other
speculative issues. However, they face major ongoing uncertainties or exposure
to adverse business, financial, or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the
obligation.

B: An obligation rated "B" are more vulnerable to nonpayment than obligations
rated "BB", but the obligor currently has the capacity to meet its financial
commitment on the obligation. Adverse business, financial, or economic
conditions will likely impair the obligor's capacity or willingness to meet its
financial commitment on the obligation.

CCC: An obligation rated "CCC" are currently vulnerable to nonpayment, and are
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation. In the event of
adverse business, financial, or economic conditions, the obligor is not likely
to have the capacity to meet its financial commitment on the obligation.

CC: An obligation rated "CC" are currently highly vulnerable to nonpayment.

C: Subordinated debt or preferred stock obligations rated "C" are currently
highly vulnerable to nonpayment. The "C" rating may be used to cover a situation
where a bankruptcy petition has been filed or similar action taken, but payments
on this obligation are being continued. A "C" also will be assigned to a
preferred stock issue in arrears on dividends or sinking fund payments, but that
is currently paying.

D: An obligation rated "D" are in payment default. The "D" rating category is
used when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The "D" rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

The ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within the major rating categories.

c: The `c' subscript is used to provide additional information to investors that
the bank may terminate its obligation to purchase tendered bonds if the
long-term credit rating of the issuer is below an investment-grade level and/or
the issuer's bonds are deemed taxable.

p: The letter `p' indicates that the rating is provisional. A provisional rating
assumes the successful completion of the project financed by the debt being
rated and indicates that payment of debt service requirements is largely or
entirely dependent upon the successful, timely completion of the project. This
rating, however, while addressing credit quality subsequent to completion of the
project, makes no comment on the likelihood of or the risk of default upon
failure of such completion. The investor should exercise his own judgment with
respect to such likelihood and risk.

Continuance of the ratings is contingent upon Standard & Poor's receipt of an
executed copy of the escrow agreement or closing documentation confirming
investments and cash flows.

r: The `r' highlights derivative, hybrid, and certain other obligations that
Standard & Poor's believes may experience high volatility or high variability in
expected returns as a result of noncredit risks. Examples of such obligations
are securities with principal or interest return indexed to equities,
commodities, or currencies; certain swaps and options; and interest-only and
principal-only mortgage securities. The absence of an `r' symbol should not be
taken as an indication that an obligation will exhibit no volatility or
variability in total return.

N.R. Not rated.

Debt obligations of issuers outside the United States and its territories are
rated on the same basis as domestic corporate and municipal issues. The ratings
measure the creditworthiness of the obligor but do not take into account
currency exchange and related uncertainties.

Bond Investment Quality Standards

Under present commercial bank regulations issued by the Comptroller of the
Currency, bonds rated in the top four categories (`AAA', `AA', `A', `BBB',
commonly known as investment-grade ratings) generally are regarded as eligible
for bank investment. Also, the laws of various states governing legal
investments impose certain rating or other standards for obligations eligible
for investment by savings banks, trust companies, insurance companies, and
fiduciaries in general

Short-Term Issue Credit Ratings
Short-term ratings are generally assigned to those obligations considered
short-term in the relevant market. In the U.S., for example, that means
obligations with an original maturity of no more than 365 days-including
commercial paper.

A-1: A short-term obligation rated "A-1" is rated in the highest category by
Standard & Poor's. The obligor's capacity to meet its financial commitment on
the obligation is strong. Within this category, certain obligations are
designated with a plus sign (+). This indicates that the obligor's capacity to
meet its financial commitment on these obligations is extremely strong.

A-2: A short-term obligation rated "A-2" is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to meet
its financial commitment on the obligation is satisfactory.

A-3: A short-term obligation rated "A-3" exhibits adequate protection
parameters. However, adverse economic conditions or changing circumstances are
more likely to lead to a weakened capacity of the obligor to meet its financial
commitment on the obligation.

B: A short-term obligation rated "B" is regarded as having significant
speculative characteristics. The obligor currently has the capacity to meet its
financial commitment on the obligation; however, it faces major ongoing
uncertainties which could lead to the obligor's inadequate capacity to meet its
financial commitment on the obligation.

C: A short-term obligation rated "C" is currently vulnerable to nonpayment and
is dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation.

D: A short-term obligation rated "D" is in payment default. The "D" rating
category is used when payments on an obligation are not made on the date due
even if the applicable grace period has not expired, unless Standard & Poor's
believes that such payments will be made during such grace period. The "D"
rating also will be used upon the filing of a bankruptcy petition or the taking
of a similar action if payments on an obligation are jeopardized.

Notes:
A Standard & Poor's note rating reflects the liquidity factors and market access
risks unique to notes. Notes due in three years or less will likely receive a
note rating. Notes maturing beyond three years will most likely receive a
long-term debt rating. The following criteria will be used in making that
assessment:
o     Amortization schedule-the larger the final maturity relative to other
      maturities, the more likely it will be treated as a note; and
o     Source of payment-the more dependent the issue is on the market for its
      refinancing, the more likely it will be treated as a note.

SP-1: Strong capacity to pay principal and interest. An issue with a very strong
capacity to pay debt service is given a (+) designation.

SP-2: Satisfactory capacity to pay principal and interest, with some
vulnerability to adverse financial and economic changes over the term of the
notes.

SP-3: Speculative capacity to pay principal and interest.

Fitch, Inc.
International credit ratings assess the capacity to meet foreign currency or
local currency commitments. Both "foreign currency" and "local currency" ratings
are internationally comparable assessments. The local currency rating measures
the probability of payment within the relevant sovereign state's currency and
jurisdiction and therefore, unlike the foreign currency rating, does not take
account of the possibility of foreign exchange controls limiting transfer into
foreign currency.

International Long-Term Credit Ratings
The following ratings scale applies to foreign currency and local currency
ratings.

Investment Grade:

AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of
credit risk. They are assigned only in the case of exceptionally strong
capacity for timely payment of financial commitments. This capacity is highly
unlikely to be adversely affected by foreseeable events.

AA: Very High Credit Quality. "AA" ratings denote a very low expectation of
credit risk. They indicate a very strong capacity for timely payment of
financial commitments. This capacity is not significantly vulnerable to
foreseeable events.

A: High Credit Quality. "A" ratings denote a low expectation of credit risk.
The capacity for timely payment of financial commitments is considered
strong. This capacity may, nevertheless, be more vulnerable to changes in
circumstances or in economic conditions than is the case for higher ratings.

BBB: Good Credit Quality. "BBB" ratings indicate that there is currently a
low expectation of credit risk. The capacity for timely payment of financial
commitments is considered adequate, but adverse changes in circumstances and
in economic conditions are more likely to impair this capacity. This is the
lowest investment-grade category.

Speculative Grade:

BB: Speculative. "BB" ratings indicate that there is a possibility of credit
risk developing, particularly as the result of adverse economic change over
time. However, business or financial alternatives may be available to allow
financial commitments to be met. Securities rated in this category are not
investment grade.

B: Highly Speculative. "B" ratings indicate that significant credit risk is
present, but a limited margin of safety remains. Financial commitments are
currently being met. However, capacity for continued payment is contingent
upon a sustained, favorable business and economic environment.

CCC, CC C: High Default Risk. Default is a real possibility. Capacity for
meeting financial commitments is solely reliant upon sustained, favorable
business or economic developments. A "CC" rating indicates that default of
some kind appears probable. "C" ratings signal imminent default.

DDD, DD, and D: Default. The ratings of obligations in this category are based
on their prospects for achieving partial or full recovery in a reorganization or
liquidation of the obligor. While expected recovery values are highly
speculative and cannot be estimated with any precision, the following serve as
general guidelines. "DDD" obligations have the highest potential for recovery,
around 90%-100% of outstanding amounts and accrued interest. "DD" indicates
potential recoveries in the range of 50%-90%, and "D" the lowest recovery
potential, i.e., below 50%.

Entities rated in this category have defaulted on some or all of their
obligations. Entities rated "DDD" have the highest prospect for resumption of
performance or continued operation with or without a formal reorganization
process. Entities rated "DD" and "D" are generally undergoing a formal
reorganization or liquidation process; those rated "DD" are likely to satisfy a
higher portion of their outstanding obligations, while entities rated "D" have a
poor prospect for repaying all obligations.

Plus (+) and minus (-) signs may be appended to a rating symbol to denote
relative status within the major rating categories. Plus and minus signs are not
added to the "AAA" category or to categories below "CCC," nor to short-term
ratings other than "F1" (see below).

International Short-Term Credit Ratings
The following ratings scale applies to foreign currency and local currency
ratings. A short-term rating has a time horizon of less than 12 months for most
obligations, or up to three years for U.S. public finance securities, and thus
places greater emphasis on the liquidity necessary to meet financial commitments
in a timely manner.

F1: Highest credit quality. Strongest capacity for timely payment of financial
commitments. May have an added "+" to denote any exceptionally strong credit
feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial
commitments, but the margin of safety is not as great as in the case of higher
ratings.

F3: Fair credit quality. Capacity for timely payment of financial commitments is
adequate. However, near-term adverse changes could result in a reduction to
non-investment grade.

B: Speculative. Minimal capacity for timely payment of financial commitments,
plus vulnerability to near-term adverse changes in financial and economic
conditions.

C: High default risk. Default is a real possibility. Capacity for meeting
financial commitments is solely reliant upon a sustained, favorable business
and economic environment.

D: Default. Denotes actual or imminent payment default.

Dominion Bond Rating Service Limited ("DBRS")

R-1: Short term debt rated "R-1 (high)" is of the highest credit quality, and
indicates an entity which possesses unquestioned ability to repay current
liabilities as they fall due. Entities rated in this category normally maintain
strong liquidity positions, conservative debt levels and profitability which is
both stable and above average. Companies achieving an "R-1 (high)" rating are
normally leaders in structurally sound industry segments with proven track
records, sustainable positive future results and no substantial qualifying
negative factors. Given the extremely tough definition which DBRS has
established for an "R-1 (high)", few entities are strong enough to achieve this
rating. Short term debt rated "R-1 (middle)" is of superior credit quality and,
in most cases, ratings in this category differ from "R-1 (high)" credits to only
a small degree. Given the extremely tough definition which DBRS has for the "R-1
(high)" category (which few companies are able to achieve), entities rated "R-1
(middle)" are also considered strong credits which typically exemplify above
average strength in key areas of consideration for debt protection. Short term
debt rated "R-1 (low)" is of satisfactory credit quality. The overall strength
and outlook for key liquidity, debt and profitability ratios is not normally as
favorable as with higher rating categories, but these considerations are still
respectable. Any qualifying negative factors which exist are considered
manageable, and the entity is normally of sufficient size to have some influence
in its industry.

R-2: Short term debt rated "R-2" is of adequate credit quality and within the
three subset grades (high, middle, low), debt protection ranges from having
reasonable ability for timely repayment to a level which is considered only just
adequate. The liquidity and debt ratios of entities in the "R-2" classification
are not as strong as those in the "R-1" category, and the past and future trend
may suggest some risk of maintaining the strength of key ratios in these areas.
Alternative sources of liquidity support are considered satisfactory; however,
even the strongest liquidity support will not improve the commercial paper
rating of the issuer. The size of the entity may restrict its flexibility, and
its relative position in the industry is not typically as strong as the "R-1
credit". Profitability trends, past and future, may be less favorable, earnings
not as stable, and there are often negative qualifying factors present which
could also make the entity more vulnerable to adverse changes in financial and
economic conditions.







                                       B-1
                                   Appendix B

             INDUSTRY CLASSIFICATIONS (Oppenheimer Money Fund/VA)

Aerospace & Defense Industrial Conglomerates Air Freight & Couriers Insurance
Airlines Internet & Catalog Retail Asset Backed Securities Internet & Software &
Services Auto Components IT Services Automobiles Leasing & Factoring Beverages
Leisure Equipment & Products Biotechnology Machinery Broker-Dealer Marine
Building Products Media Capital Markets Metals & Mining Chemicals Multiline
Retail Commercial Banks Multi-Utilities Commercial Finance Municipal Commercial
Services & Supplies Office Electronics Communications Equipment Oil & Gas
Computers & Peripherals Paper & Forest Products Construction & Engineering
Personal Products Construction Materials Pharmaceuticals Consulting & Services
Real Estate Consumer Finance Repurchase Agreements Containers & Packaging Road &
Rail Distributors Semiconductor and Semiconductor Equipment Diversified
Financial Services Software Diversified Telecommunication Special Purpose
Financial Services Electric Utilities Specialty Retail Electrical Equipment
Textiles, Apparel & Luxury Goods Electronic Equipment & Instruments Thrifts &
Mortgage Finance Energy Equipment & Services Tobacco Food & Drug Retailing
Trading Companies & Distributors Food Products Transportation Infrastructure
Foreign Government                  U.S. Government Agencies-Full Faith and Credit
Gas Utilities                       U.S. Government Agencies-Government Sponsored
                                   Enterprises
Health Care Equipment & Supplies    U.S. Government Instrumentalities
Health Care Providers & Services    U.S. Government Obligations
Hotels Restaurants & Leisure        Water Utilities
Household Durables                  Wireless Transportation Services
Household Products






                                       C-1
                                   Appendix C

    INDUSTRY CLASSIFICATIONS (all Funds except Oppenheimer Money Fund/VA)

Aerospace & Defense                 Household Products
Air Freight & Couriers              Industrial Conglomerates
Airlines                            Insurance
Auto Components                     Internet & Catalog Retail
Automobiles                         Internet Software & Services
Beverages                           IT Services
Biotechnology                       Leisure Equipment & Products
Building Products                   Machinery
Chemicals                           Marine
Consumer Finance                    Media
Commercial Banks                    Metals & Mining
Commercial Services & Supplies      Multiline Retail
Communications Equipment            Multi-Utilities
Computers & Peripherals             Office Electronics
Construction & Engineering          Oil & Gas
Construction Materials              Paper & Forest Products
Containers & Packaging              Personal Products
Distributors                        Pharmaceuticals
Diversified Financial Services      Real Estate
Diversified Telecommunication       Road & Rail
Services
Electric Utilities                  Semiconductors and Semiconductor
                                    Equipment
Electrical Equipment                Software
Electronic Equipment & Instruments  Specialty Retail
Energy Equipment & Services         Textiles, Apparel & Luxury Goods
Food & Staples Retailing            Thrifts & Mortgage Finance
Food Products                       Tobacco
Gas Utilities                       Trading Companies & Distributors
Health Care Equipment & Supplies    Transportation Infrastructure
Health Care Providers & Services    Water Utilities
Hotels Restaurants & Leisure        Wireless Telecommunication Services
Household Durables







                                       D-8
                                   Appendix D

Major Shareholders. As of March 31, 2005 the total number of shares outstanding,
and the number of shares and approximate percentage of Fund shares held of
record by separate accounts of the following insurance companies (and their
respective subsidiaries) and by OppenheimerFunds, Inc. ("OFI") were as follows.
["*" indicates less than 5% of the outstanding shares of that fund or class]:

Oppenheimer Variable Account
Funds
(consisting of 11 separate       Total Shares              Allmerica  Allstate
Funds)                            in the fund    Allianz   Financial  Financial
Aggressive Growth Fund/VA        26,781,056.324          *          *         *
Non-Service Shares

Aggressive Growth Fund/VA           603,238.283          *          *         *
Service Shares

Balanced Fund/VA                 32,450,812.347          *          *         *
Non-Service Shares

Balanced Fund/VA                  4,077,834.698          * 580,503.917        *
Service Shares
                                                                          14.24%
Capital Appreciation Fund/VA     46,827,565.765          *                    *
Non-Service Shares

Capital Appreciation Fund/VA      7,385,080.732          * 507,274.107        *
Service Shares
                                                                           6.87%
Core Bond Fund/VA                44,017,325.636          *          *         *
Non-Service Shares

Core Bond Fund/VA                   468,185.238          *          *         *
Service Shares

Global Securities Fund/VA        85,501,337.512 8,215,672.743       *         *
Non-Service Shares
                                                     9.61%
Global Securities Fund/VA        12,805,429.819          * 1,162,413.377      *
Service Shares
                                                                           9.08%
Global Securities Fund/VA         9,613,031.055          *          *         *
Class 3 shares

Global Securities Fund/VA         1,625,936.088          *          *         *
Class 4 shares

High Income Fund/VA              54,637,269.586 5,310,746.846       *         *
Non-Service Shares
                                                     9.72%
High Income/VA                   15,825,669.459          * 3,367,162.723      *
Service Shares
                                                                          21.28%
Main Street Fund/VA              58,105,140.430 9,063,829.785       *         *
Non-Service Shares
                                                    15.60%
Main Street Fund/VA              19,831,863.824          *          *         *
Service Shares

Main Street Small Cap Fund/VA     2,527,035.289          *          * 282,588.373
Non-Service Shares
                                                                          11.18%
Main Street Small Cap Fund/VA    11,988,173.961          *          *         *
Service Shares

Money Fund/VA                   189,404,895.300          *          *         *
Non-Service Shares

Strategic Bond Fund/VA          125,859,150.212          *          *         *
Non-Service Shares
                                              *
Strategic Bond Fund/VA           58,844,095.379          *          *         *
Service Shares
                                              *
Value Fund/VA                                 *          *          *         *
Non-Service Shares


Oppenheimer Variable Account
Funds                            Allstate
(consisting of 11 separate         Life     Allstate Life   American    American
Funds)                             of NY      Ins. Co.      Express     General
Aggressive Growth Fund/VA                 *             *            *          *
Non-Service Shares

Aggressive Growth Fund/VA        53,788.546   334,387.046            *          *
Service Shares
                                      8.92%        55.43%
Balanced Fund/VA                          *             *            *          *
Non-Service Shares

Balanced Fund/VA                337,941.382 2,218,853.805            *          *
Service Shares
                                      8.29%        54.41%
Capital Appreciation Fund/VA              *             *            *          *
Non-Service Shares

Capital Appreciation Fund/VA              * 1,218,973.166  891,053.502          *
Service Shares
                                                   16.51%       12.07%
Core Bond Fund/VA                         *             *            *          *
Non-Service Shares

Core Bond Fund/VA                87,130.170   156,817.619            *          *
Service Shares
                                     18.61%        33.49%
Global Securities Fund/VA                 *             *            *          *
Non-Service Shares

Global Securities Fund/VA                 *   971,431.913            *          *
Service Shares
                                                    7.59%
Global Securities Fund/VA                 *             *            *          *
Class 3 shares

Global Securities Fund/VA                 *             *            *          *
Class 4 shares

High Income Fund/VA                       *             *            *          *
Non-Service Shares

High Income/VA                  906,702.112 4,130,160.942            *          *
Service Shares
                                      5.73%        26.10%
Main Street Fund/VA                       *             *            *          *
Non-Service Shares

Main Street Fund/VA                       * 2,895,841.007            *          *
Service Shares
                                                   14.60%
Main Street Small Cap Fund/VA   144,181.237             *            * 318,185.813
Non-Service Shares
                                      5.71%                                12.59%
Main Street Small Cap Fund/VA             * 1,961,925.917  687,171.522          *
Service Shares
                                                   16.37%        5.73%
Money Fund/VA                             *             *            *          *
Non-Service Shares

Strategic Bond Fund/VA                    *             *            *          *
Non-Service Shares

Strategic Bond Fund/VA          2,946,934.2716,581,698.96813,363,031.431        *
Service Shares
                                      5.01%        28.18%       22.71%
Value Fund/VA                             *             *            *          *
Non-Service Shares


Oppenheimer Variable Account
Funds
(consisting of 11 separate                    Security
Funds)                              Cuna      Benefit        GE        IDS Life
Aggressive Growth Fund/VA                  *          * 2,424,195.293           *
Non-Service Shares
                                                                           9.05%
Aggressive Growth Fund/VA                  *          *  153,225.794            *
Service Shares
                                                                          25.40%
Balanced Fund/VA                           *          * 5,106,237.963           *
Non-Service Shares
                                                                          15.74%
Balanced Fund/VA                           *          *  892,969.487            *
Service Shares
                                                                          21.90%
Capital Appreciation Fund/VA               *          * 4,617,366.648           *
Non-Service Shares
                                                                           9.86%
Capital Appreciation Fund/VA               *          *  489,562.758            *
Service Shares
                                                                           6.63%
Core Bond Fund/VA                          *          * 7,724,610.929           *
Non-Service Shares
                                                                          17.55%
Core Bond Fund/VA                          *          *            *            *
Service Shares

Global Securities Fund/VA                  *          *            *            *
Non-Service Shares

Global Securities Fund/VA                  *          * 3,821,670.8281,340,540.525
Service Shares
                                                              29.84%       10.47%
Global Securities Fund/VA                  *          *            *            *
Class 3 shares

Global Securities Fund/VA                  *          *            *            *
Class 4 shares

High Income Fund/VA             8,829,384.258         * 10,661,396.170          *
Non-Service Shares
                                      16.16%                  19.51%
High Income/VA                             *          *            *            *
Service Shares

Main Street Fund/VA                        *          *            *            *
Non-Service Shares

Main Street Fund/VA                        *          * 3,283,512.159           *
Service Shares
                                                                          16.56%
Main Street Small Cap Fund/VA              *          *            *            *
Non-Service Shares

Main Street Small Cap Fund/VA              * 622,924.0381,818,115.0151,616,514.898
Service Shares
                                                  5.20%       15.17%       13.48%
Money Fund/VA                              *          *            *            *
Non-Service Shares

Strategic Bond Fund/VA                     *          *            *            *
Non-Service Shares

Strategic Bond Fund/VA                     *          *            * 15,954,272.458
Service Shares
                                                                           27.11%
Value Fund/VA                              *          *            *            *
Non-Service Shares


Oppenheimer Variable Account
Funds
(consisting of 11 separate                                Lincoln        Mass
Funds)                              ING        Kemper     Benefit       Mutual
Aggressive Growth Fund/VA                  *          *            * 14,626,387.364
Non-Service Shares
                                                                            54.61%
Aggressive Growth Fund/VA                  *          *            *             *
Service Shares

Balanced Fund/VA                           *          *            * 10,415,229.884
Non-Service Shares
                                                                            32.10%
Balanced Fund/VA                           *          *            *             *
Service Shares

Capital Appreciation Fund/VA               *          *            * 13,747,926.263
Non-Service Shares
                                                                            29.36%
Capital Appreciation Fund/VA               *          *            *             *
Service Shares

Core Bond Fund/VA                          *          *            * 17,530,992.366
Non-Service Shares
                                                                            39.83%
Core Bond Fund/VA                          *          *            *             *
Service Shares

Global Securities Fund/VA       17,116,243.379        *            * 33,858,537.926
Non-Service Shares
                                      20.02%                                39.60%
Global Securities Fund/VA                  * 922,694.041           *             *
Service Shares
                                                  7.21%
Global Securities Fund/VA                  *          *            *             *
Class 3 shares

Global Securities Fund/VA                  *          *            *             *
Class 4 shares

High Income Fund/VA                        *          *            * 21,145,084.899
Non-Service Shares
                                                                            38.70%
High Income/VA                             *          *            *             *
Service Shares

Main Street Fund/VA             3,534,160.562         *            * 15,947,530.795
Non-Service Shares
                                       6.08%                                27.45%
Main Street Fund/VA                        *          *            *             *
Service Shares

Main Street Small Cap Fund/VA              *          *            *   994,605.123
Non-Service Shares
                                                                            39.36%
Main Street Small Cap Fund/VA              * 601,227.6222,767,597.168            *
Service Shares
                                                  5.02%       23.09%
Money Fund/VA                              *          *            * 151,541,495.820
Non-Service Shares
                                                                            80.01%
Strategic Bond Fund/VA          24,709,486.581        *            * 75,791,209.495
Non-Service Shares
                                      19.63%                                60.22%
Strategic Bond Fund/VA                     *          *            *             *
Service Shares

Value Fund/VA                              *          *            *             *
Non-Service Shares


Oppenheimer Variable Account
Funds
(consisting of 11 separate        Merrill     Minnesota      MONY
Funds)                             Lynch         Life        Life      Nationwide
Aggressive Growth Fund/VA                  *            *           * 7,166,013.071
Non-Service Shares
                                                                            26.76%
Aggressive Growth Fund/VA                  *            *           *
Service Shares

Balanced Fund/VA                2,298,787.985           *           * 11,465,669.286
Non-Service Shares
                                       7.08%                                35.33%
Balanced Fund/VA                           *            *           *            *
Service Shares

Capital Appreciation Fund/VA               *            *           * 21,898,855.207
Non-Service Shares
                                                                            46.76%
Capital Appreciation Fund/VA               *            *           * 2,050,675.390
Service Shares
                                                                            27.77%
Core Bond Fund/VA                          *            *           * 16,132,965.875
Non-Service Shares
                                                                            36.65%
Core Bond Fund/VA                          *            *           *            *
Service Shares

Global Securities Fund/VA                  *            *           * 22,231,333.933
Non-Service Shares
                                                                            26.00%
Global Securities Fund/VA                  *            * 1,016,583.121,313,346.600
Service Shares
                                                                7.94%       10.26%
Global Securities Fund/VA                  *            *           * 9,613,031.055
Class 3 shares
                                                                           100.00%
Global Securities Fund/VA                  *            *           * 1,625,936.088
Class 4 shares
                                                                           100.00%
High Income Fund/VA                        *            *           *            *
Non-Service Shares

High Income/VA                             * 2,783,539.293          * 3,063,180.015
Service Shares
                                                   17.59%                   19.36%
Main Street Fund/VA                        *            *           * 22,312,739.087
Non-Service Shares
                                                                            38.40%
Main Street Fund/VA                        *            *           * 3,084,943.221
Service Shares
                                                                            15.56%
Main Street Small Cap Fund/VA              *            *           *  460,703.579
Non-Service Shares
                                                                            18.23%
Main Street Small Cap Fund/VA              *            *           *  932,149.856
Service Shares
                                                                             7.78%
Money Fund/VA                   16,161,004.130          *           *            *
Non-Service Shares
                                      8.53%
                         Strategic Bond Fund/VA * * * *
                               Non-Service Shares

Strategic Bond Fund/VA                     *            *           * 4,692,183.731
Service Shares
                                                                             7.97%
Value Fund/VA                              *            *           *            *
Non-Service Shares


Oppenheimer Variable Account
Funds
(consisting of 11 separate                                SunLife
Funds)                           Protective     Sage     Financial    Travelers
Aggressive Growth Fund/VA                  *          *            *           *
Non-Service Shares

Aggressive Growth Fund/VA                  *          *            *           *
Service Shares

Balanced Fund/VA                           *          *            *           *
Non-Service Shares

Balanced Fund/VA                           *          *            *           *
Service Shares

Capital Appreciation Fund/VA               *          *            *           *
Non-Service Shares

Capital Appreciation Fund/VA               *          *  874,085.538 520,990.307
Service Shares
                                                              11.84%       7.05%
Core Bond Fund/VA                          *          *            *           *
Non-Service Shares

Core Bond Fund/VA                          * 224,237.449           *           *
Service Shares
                                                 47.90%
Global Securities Fund/VA                  *          *            *           *
Non-Service Shares

Global Securities Fund/VA                  *          *            *           *
Service Shares

Global Securities Fund/VA                  *          *            *           *
Class 3 shares

Global Securities Fund/VA                  *          *            *           *
Class 4 shares

High Income Fund/VA                        *          *            *           *
Non-Service Shares

High Income/VA                             *          *            *           *
Service Shares

Main Street Fund/VA             3,261,298.056         *            *           *
Non-Service Shares
                                      5.61%
               Main Street Fund/VA * * 7,268,178.7681,136,163.499
                                 Service Shares
                                                              36.65%       5.73%
Main Street Small Cap Fund/VA              *          *            *           *
Non-Service Shares

Main Street Small Cap Fund/VA              *          *            *           *
Service Shares

Money Fund/VA                   15,365,629.760        *            *           *
Non-Service Shares
                                      8.11%
Strategic Bond Fund/VA          17,993,662.069        *            *           *
Non-Service Shares
                                     14.30%
                         Strategic Bond Fund/VA * * * *
                                 Service Shares

                             Value Fund/VA * * * *
                               Non-Service Shares








                                       D-2

Oppenheimer Variable Account Funds

Internet Website:
      www.oppenheimerfunds.com

Investment Advisor
      OppenheimerFunds, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Distributor
      OppenheimerFunds Distributor, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Transfer Agent
      OppenheimerFunds Services
      P.O. Box 5270 Denver, Colorado 80217 1.800.981.2871

Custodian Bank
      JPMorgan Chase Bank
      4 Chase Metro Tech Center
      Brooklyn, New York 11245

Independent Registered Public Accounting Firm
      Deloitte & Touche LLP
      555 Seventeenth Street
      Denver, Colorado 80202

Counsel to the Funds
      Myer, Swanson, Adams & Wolf, P.C.
      1600 Broadway
      Denver, Colorado 80202

Counsel to the Independent Trustees
      Bell, Boyd & Lloyd LLC
      70 West Madison Street, Suite 3100
      Chicago, Illinois 60602

(OppenheimerFunds logo)
PXOVAF.001.1205