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