-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Oj3oejOLI3DYDAz3gMO4JRYCNxGbtxis3Gx5QtQbVrhkWr3grNGLrJBlTqH6C394 4piMu3Dm1p1vKpestroYjQ== 0000935069-04-001210.txt : 20040824 0000935069-04-001210.hdr.sgml : 20040824 20040824141647 ACCESSION NUMBER: 0000935069-04-001210 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20040630 FILED AS OF DATE: 20040824 DATE AS OF CHANGE: 20040824 EFFECTIVENESS DATE: 20040824 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER VARIABLE ACCOUNT FUNDS CENTRAL INDEX KEY: 0000752737 IRS NUMBER: 840974272 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-04108 FILM NUMBER: 04993751 BUSINESS ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 BUSINESS PHONE: 3036713200 MAIL ADDRESS: STREET 2: 6803 SOUTH TUCSON WAY CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER VARIABLE LIFE FUNDS DATE OF NAME CHANGE: 19860609 N-CSRS 1 rs0640_10943.txt RS0640_10943.TXT UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-4108 Oppenheimer High Income Fund/VA (Exact name of registrant as specified in charter) 6803 South Tucson Way, Centennial, Colorado 80112-3924 (Address of principal executive offices) (Zip code) Robert G. Zack, Esq. OppenheimerFunds, Inc. Two World Financial Center, New York, New York 10281-1008 - -------------------------------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: (303) 768-3200 -------------- Date of fiscal year end: December 31 ----------- Date of reporting period: January 1, 2004 - June 30, 2004 ITEM 1. REPORTS TO STOCKHOLDERS. STATEMENT OF INVESTMENTS June 30, 2004 / Unaudited - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ ASSET-BACKED SECURITIES--0.1% - ------------------------------------------------------------------------ Consumer Credit Reference Index Securities Program, Credit Card Asset-Backed Certificates, Series 2002-B, Cl. FX, 10.421%, 3/22/07 1 (Cost $497,606) $ 500,000 $ 524,482 - ------------------------------------------------------------------------ MORTGAGE-BACKED OBLIGATIONS--0.1% - ------------------------------------------------------------------------ First Chicago/Lennar Trust 1, Commercial Mtg. Pass-Through Certificates, Series 1997-CHL1, Cl. D, 7.902%, 4/29/39 1,2 300,000 310,219 - ------------------------------------------------------------------------ Salomon Brothers Mortgage Securities VII, Inc., Commercial Mtg. Pass-Through Certificates, Series 1996-B, Cl. 1, 7.007%, 4/25/26 1,2 165,863 149,277 ------------- Total Mortgage-Backed Obligations (Cost $39,143) 459,496 - ------------------------------------------------------------------------ LOAN PARTICIPATIONS--0.0% - ------------------------------------------------------------------------ Telergy, Inc., Sr. Sec. Credit Facilities Term Loan Participation Nts., Tranche A, 1/1/02 1,3,4 (Cost $966,644) 986,362 -- - ------------------------------------------------------------------------ CORPORATE BONDS AND NOTES--78.5% - ------------------------------------------------------------------------ CONSUMER DISCRETIONARY--23.4% - ------------------------------------------------------------------------ AUTO COMPONENTS--2.3% Collins & Aikman Floorcoverings, Inc., 9.75% Sr. Sub. Nts., Series B, 2/15/10 800,000 816,000 - ------------------------------------------------------------------------ Collins & Aikman Products Co., 10.75% Sr. Nts., 12/31/11 557,000 562,570 - ------------------------------------------------------------------------ Dana Corp.: 9% Unsec. Nts., 8/15/11 1,480,000 1,739,000 10.125% Nts., 3/15/10 500,000 568,750 - ------------------------------------------------------------------------ Dura Operating Corp.: 8.625% Sr. Nts., Series B, 4/15/12 1,000,000 1,025,000 9% Sr. Sub. Nts., Series B, 5/1/09 [EUR] 100,000 116,798 9% Sr. Unsec. Sub. Nts., Series D, 5/1/09 200,000 197,000 - ------------------------------------------------------------------------ Eagle-Picher, Inc., 9.75% Sr. Nts., 9/1/13 1,200,000 1,296,000 - ------------------------------------------------------------------------ Keystone Automotive Operations, Inc., 9.75% Sr. Sub. Nts., 11/1/13 5 200,000 215,000 - ------------------------------------------------------------------------ Lear Corp., 8.11% Sr. Unsec. Nts., Series B, 5/15/09 1,300,000 1,482,269 - ------------------------------------------------------------------------ Metaldyne Corp.: 10% Sr. Nts., 11/1/13 5 500,000 492,500 11% Sr. Sub. Nts., 6/15/12 750,000 641,250 - ------------------------------------------------------------------------ Stoneridge, Inc., 11.50% Sr. Nts., 5/1/12 1,400,000 1,655,500 - ------------------------------------------------------------------------ Tenneco Automotive, Inc., 10.25% Sr. Sec. Nts., Series B, 7/15/13 900,000 1,021,500 - ------------------------------------------------------------------------ United Components, Inc., 9.375% Sr. Sub. Nts., 6/15/13 400,000 410,000 ------------- 12,239,137 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HOTELS, RESTAURANTS & LEISURE--6.6% American Casino & Entertainment, 7.85% Sr. Sec. Nts., 2/1/12 5 $ 800,000 $ 816,000 - ------------------------------------------------------------------------ Apcoa, Inc., 9.25% Sr. Unsec. Sub. Nts., 3/15/08 1 940,000 850,700 - ------------------------------------------------------------------------ Aztar Corp., 9% Sr. Unsec. Sub. Nts., 8/15/11 450,000 500,625 - ------------------------------------------------------------------------ Boca Resorts, Inc., 9.875% Sr. Sub. Nts., 4/15/09 800,000 846,000 - ------------------------------------------------------------------------ Boyd Gaming Corp., 8.75% Sr. Sub. Nts., 4/15/12 800,000 856,000 - ------------------------------------------------------------------------ Capital Gaming International, Inc., 11.50% Promissory Nts., 8/1/1995 1,3,4 9,500 -- - ------------------------------------------------------------------------ Coast Hotels & Casinos, Inc., 9.50% Sr. Unsec. Sub. Nts., 4/1/09 1 1,100,000 1,160,500 - ------------------------------------------------------------------------ Domino's, Inc., 8.25% Sr. Unsec. Sub. Nts., 7/1/11 1,200,000 1,278,000 - ------------------------------------------------------------------------ Gaylord Entertainment Co., 8% Sr. Nts., 11/15/13 5 500,000 509,375 - ------------------------------------------------------------------------ Hilton Hotels Corp.: 7.625% Nts., 12/1/12 500,000 540,000 7.625% Nts., 5/15/08 400,000 433,000 - ------------------------------------------------------------------------ Hollywood Park, Inc., 9.25% Sr. Unsec. Sub. Nts., Series B, 2/15/07 1,000,000 1,030,000 - ------------------------------------------------------------------------ Intrawest Corp., 7.50% Sr. Unsec. Nts., 10/15/13 917,000 900,953 - ------------------------------------------------------------------------ Isle of Capri Casinos, Inc.: 7% Sr. Sub. Nts., 3/1/14 5 800,000 746,000 9% Sr. Sub. Nts., 3/15/12 600,000 649,500 - ------------------------------------------------------------------------ John Q. Hammons Hotels, Inc., 8.875% Sr. Nts., Series B, 5/15/12 900,000 981,000 - ------------------------------------------------------------------------ Mandalay Resort Group, 10.25% Sr. Unsec. Sub. Nts., Series B, 8/1/07 800,000 892,000 - ------------------------------------------------------------------------ MGM Mirage, Inc.: 8.375% Sr. Unsec. Sub. Nts., 2/1/11 1,700,000 1,785,000 9.75% Sr. Unsec. Sub. Nts., 6/1/07 800,000 878,000 - ------------------------------------------------------------------------ Mohegan Tribal Gaming Authority: 6.375% Sr. Sub. Nts., 7/15/09 800,000 806,000 8% Sr. Sub. Nts., 4/1/12 700,000 749,000 8.375% Sr. Sub. Nts., 7/1/11 1,200,000 1,302,000 - ------------------------------------------------------------------------ Park Place Entertainment Corp.: 7.875% Sr. Sub. Nts., 3/15/10 1,500,000 1,590,000 9.375% Sr. Unsec. Sub. Nts., 2/15/07 1,500,000 1,633,125 - ------------------------------------------------------------------------ Penn National Gaming, Inc., 8.875% Sr. Sub. Nts., 3/15/10 600,000 654,750 - ------------------------------------------------------------------------ Pinnacle Entertainment, Inc., 8.25% Sr. Sub. Nts., 3/15/12 5 900,000 866,250 - ------------------------------------------------------------------------ Prime Hospitality Corp., 8.375% Sr. Sub. Nts., 5/1/12 400,000 415,000 - ------------------------------------------------------------------------ River Rock Entertainment LLC, 9.75% Sr. Nts., 11/1/11 5 600,000 657,000 - ------------------------------------------------------------------------ 5 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HOTELS, RESTAURANTS & LEISURE Continued Royal Caribbean Cruises Ltd., 8.75% Sr. Unsub. Nts., 2/2/11 $ 600,000 $ 667,500 - ------------------------------------------------------------------------ Six Flags, Inc.: 8.875% Sr. Nts., 2/1/10 400,000 398,000 9.625% Sr. Nts., 6/1/14 5 57,000 57,000 9.75% Sr. Nts., 4/15/13 1,500,000 1,515,000 - ------------------------------------------------------------------------ Starwood Hotels & Resorts Worldwide, Inc., 7.875% Sr. Nts., 5/1/12 1,500,000 1,612,500 - ------------------------------------------------------------------------ Station Casinos, Inc.: 6.50% Sr. Unsec. Sub. Nts., 2/1/14 2,000,000 1,935,000 9.875% Sr. Unsec. Sub. Nts., 7/1/10 1 600,000 663,750 - ------------------------------------------------------------------------ Sun International Hotels Ltd., 8.875% Sr. Unsec. Sub. Nts., 8/15/11 1,000,000 1,072,500 - ------------------------------------------------------------------------ Trump Casino Holdings LLC/Trump Casino Funding, Inc., 11.625% Sr. Sec. Nts., 3/15/10 657,000 676,710 - ------------------------------------------------------------------------ Universal City Development Partners Ltd., 11.75% Sr. Nts., 4/1/10 1,000,000 1,162,500 - ------------------------------------------------------------------------ Vail Resorts, Inc., 6.75% Sr. Sub. Nts., 2/15/14 900,000 857,250 - ------------------------------------------------------------------------ Venetian Casino Resort LLC/Las Vegas Sands, Inc., 11% Sec. Nts., 6/15/10 850,000 986,000 ------------- 35,929,488 - ------------------------------------------------------------------------ HOUSEHOLD DURABLES--1.9% Beazer Homes USA, Inc., 8.375% Sr. Nts., 4/15/12 500,000 530,000 - ------------------------------------------------------------------------ Blount, Inc., 13% Sr. Sub. Nts., 8/1/09 650,000 699,563 - ------------------------------------------------------------------------ D.R. Horton, Inc., 9.75% Sr. Sub. Nts., 9/15/10 300,000 349,125 - ------------------------------------------------------------------------ K. Hovnanian Enterprises, Inc., 8.875% Sr. Sub. Nts., 4/1/12 800,000 844,000 - ------------------------------------------------------------------------ KB Home: 8.625% Sr. Sub. Nts., 12/15/08 150,000 162,000 9.50% Sr. Unsec. Sub. Nts., 2/15/11 350,000 387,625 - ------------------------------------------------------------------------ Meritage Corp., 9.75% Sr. Unsec. Nts., 6/1/11 1,200,000 1,326,000 - ------------------------------------------------------------------------ Norcraft Cos. LP, 9% Sr. Sub. Nts., 11/1/11 5 300,000 318,000 - ------------------------------------------------------------------------ Salton, Inc., 10.75% Sr. Unsec. Sub. Nts., 12/15/05 220,000 191,400 - ------------------------------------------------------------------------ Sealy Mattress Co., 8.25% Sr. Sub. Nts., 6/15/14 5 1,000,000 1,010,000 - ------------------------------------------------------------------------ Standard Pacific Corp., 9.25% Sr. Sub. Nts., 4/15/12 700,000 756,000 - ------------------------------------------------------------------------ Toll Corp., 8.25% Sr. Sub. Nts., 12/1/11 500,000 545,000 - ------------------------------------------------------------------------ WCI Communities, Inc.: 9.125% Sr. Sub. Nts., 5/1/12 800,000 868,000 10.625% Sr. Unsec. Sub. Nts., 2/15/11 600,000 667,500 - ------------------------------------------------------------------------ William Lyon Homes, Inc., 10.75% Sr. Nts., 4/1/13 1 800,000 888,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HOUSEHOLD DURABLES CONTINUED Williams Scotsman, Inc., 9.875% Sr. Unsec. Nts., 6/1/07 $ 1,000,000 $ 997,500 ------------- 10,539,713 - ------------------------------------------------------------------------ LEISURE EQUIPMENT & PRODUCTS--0.2% K2 Corp., 7.375% Sr. Nts., 7/1/14 5,6 400,000 409,000 - ------------------------------------------------------------------------ Remington Arms Co., Inc., 10.50% Sr. Unsec. Nts., 2/1/11 800,000 780,000 ------------- 1,189,000 - ------------------------------------------------------------------------ MEDIA--10.5% Adelphia Communications Corp.: 7.875% Sr. Unsec. Nts., 5/1/09 3,4 360,000 344,700 8.125% Sr. Nts., Series B, 7/15/03 3,4 1,000,000 975,000 8.375% Sr. Nts., Series B, 2/1/08 3,4 1,000,000 982,500 10.875% Sr. Unsec. Nts., 10/1/10 3,4 1,000,000 1,015,000 - ------------------------------------------------------------------------ Allbritton Communications Co., 7.75% Sr. Unsec. Sub. Nts., 12/15/12 700,000 693,000 - ------------------------------------------------------------------------ AMC Entertainment, Inc.: 8% Sr. Sub. Nts., 3/1/14 5 700,000 672,000 9.50% Sr. Unsec. Sub. Nts., 2/1/11 1,592,000 1,663,640 - ------------------------------------------------------------------------ American Media Operations, Inc.: 8.875% Sr. Unsec. Sub. Nts., 1/15/11 900,000 875,250 10.25% Sr. Unsec. Sub. Nts., Series B, 5/1/09 300,000 312,750 - ------------------------------------------------------------------------ Block Communications, Inc., 9.25% Sr. Sub. Nts., 4/15/09 600,000 633,000 - ------------------------------------------------------------------------ Cablevision Systems Corp., 8% Sr. Nts., 4/15/12 5 500,000 495,000 - ------------------------------------------------------------------------ CanWest Media, Inc., 7.625% Sr. Unsec. Sub. Nts., Series B, 4/15/13 300,000 309,750 - ------------------------------------------------------------------------ Carmike Cinemas, Inc., 7.50% Sr. Sub. Nts., 2/15/14 5 850,000 816,000 - ------------------------------------------------------------------------ CBD Media LLC/CBD Finance, Inc., 8.625% Sr. Sub. Nts., 6/1/11 200,000 211,500 - ------------------------------------------------------------------------ Charter Communications Holdings II, 10.25% Sr. Unsec. Nts., 9/15/10 5 1,600,000 1,620,000 - ------------------------------------------------------------------------ Charter Communications Holdings LLC/Charter Communications Holdings Capital Corp.: 0%/11.75% Sr. Unsec. Sub. Disc. Nts., 5/15/11 7 3,975,000 2,593,688 8.375% Sr. Nts., Second Lien, 4/30/14 5 1,500,000 1,458,750 8.625% Sr. Unsec. Nts., 4/1/09 3,500,000 2,808,750 9.92% Sr. Unsec. Disc. Nts., 4/1/11 1,800,000 1,431,000 10% Sr. Nts., 4/1/09 500,000 420,000 10% Sr. Unsec. Sub. Nts., 5/15/11 57,000 45,458 11.125% Sr. Unsec. Nts., 1/15/11 600,000 507,000 - ------------------------------------------------------------------------ Cinemark USA, Inc., 9% Sr. Unsec. Sub. Nts., 2/1/13 400,000 438,500 - ------------------------------------------------------------------------ Cinemark, Inc., 0%/9.75% Sr. Disc. Nts., 3/15/14 5,7 1,800,000 1,183,500 6 | OPPENHEIMER HIGH INCOME FUND/VA PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ MEDIA Continued Corus Entertainment, Inc., 8.75% Sr. Sub. Nts., 3/1/12 $ 800,000 $ 859,000 - ------------------------------------------------------------------------ CSC Holdings, Inc., 7.625% Sr. Unsec. Unsub. Nts., Series B, 4/1/11 1,800,000 1,813,500 - ------------------------------------------------------------------------ DirecTV Holdings LLC/DirecTV Financing Co., Inc., 8.375% Sr. Unsec. Nts., 3/15/13 3,400,000 3,778,250 - ------------------------------------------------------------------------ Diva Systems Corp., 12.625% Sr. Unsec. Disc. Nts., Series B, 3/1/08 1,3,4 500,000 3,750 - ------------------------------------------------------------------------ EchoStar DBS Corp.: 9.125% Sr. Nts., 1/15/09 1,895,000 2,086,869 10.375% Sr. Unsec. Nts., 10/1/07 3,000,000 3,221,250 - ------------------------------------------------------------------------ Emmis Operating Co., 6.875% Sr. Sub. Nts., 5/15/12 5 1,200,000 1,182,000 - ------------------------------------------------------------------------ Entravision Communications Corp., 8.125% Sr. Sub. Nts., 3/15/09 600,000 621,750 - ------------------------------------------------------------------------ Granite Broadcasting Corp., 9.75% Sr. Sec. Nts., 12/1/10 1,257,000 1,175,295 - ------------------------------------------------------------------------ Gray Television, Inc., 9.25% Sr. Sub. Nts., 12/15/11 500,000 550,625 - ------------------------------------------------------------------------ Hollinger International Publishing, Inc., 9% Sr. Unsec. Nts., 12/15/10 1,100,000 1,276,000 - ------------------------------------------------------------------------ Houghton Mifflin Co.: 8.25% Sr. Unsec. Nts., 2/1/11 800,000 804,000 9.875% Sr. Sub. Nts., 2/1/13 57,000 57,285 - ------------------------------------------------------------------------ Kabel Deutschland GmbH, 10.625% Sr. Nts., 7/1/14 5,6 600,000 619,500 - ------------------------------------------------------------------------ Lamar Media Corp., 7.25% Sr. Unsec. Sub. Nts., 1/1/13 200,000 204,500 - ------------------------------------------------------------------------ Lin Television Corp., 6.50% Sr. Sub. Nts., 5/15/13 500,000 485,000 - ------------------------------------------------------------------------ LodgeNet Entertainment Corp., 9.50% Sr. Sub. Debs., 6/15/13 400,000 439,000 - ------------------------------------------------------------------------ Mediacom LLC/Mediacom Capital Corp., 9.50% Sr. Unsec. Nts., 1/15/13 1,957,000 1,898,290 - ------------------------------------------------------------------------ MediaNews Group, Inc.: 6.375% Sr. Sub. Nts., 4/1/14 1,400,000 1,281,000 6.875% Sr. Unsec. Sub. Nts., 10/1/13 500,000 475,000 - ------------------------------------------------------------------------ News America Holdings, Inc., 8.875% Sr. Debs., 4/26/23 625,000 782,776 - ------------------------------------------------------------------------ PanAmSat Corp., 8.50% Sr. Unsec. Nts., 2/1/12 1,200,000 1,368,000 - ------------------------------------------------------------------------ PRIMEDIA, Inc.: 8% Sr. Nts., 5/15/13 5 1,700,000 1,606,500 8.875% Sr. Unsec. Nts., 5/15/11 57,000 56,715 - ------------------------------------------------------------------------ R.H. Donnelley Financial Corp. I: 8.875% Sr. Nts., 12/15/10 5 700,000 771,750 10.875% Sr. Sub. Nts., 12/15/12 5 1,000,000 1,165,000 - ------------------------------------------------------------------------ Radio One, Inc., 8.875% Sr. Unsec. Sub. Nts., Series B, 7/1/11 800,000 877,000 - ------------------------------------------------------------------------ Sinclair Broadcast Group, Inc., 8% Sr. Unsec. Sub. Nts., 3/15/12 1,600,000 1,644,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ MEDIA CONTINUED Spanish Broadcasting System, Inc., 9.625% Sr. Unsec. Sub. Nts., 11/1/09 $ 600,000 $ 636,000 - ------------------------------------------------------------------------ Vertis, Inc.: 9.75% Sr. Sec. Nts., 4/1/09 500,000 540,000 10.875% Sr. Unsec. Nts., Series B, 6/15/09 650,000 702,000 - ------------------------------------------------------------------------ Vivendi Universal SA, 9.25% Sr. Nts., 4/15/10 500,000 590,975 - ------------------------------------------------------------------------ WRC Media, Inc./Weekly Reader Corp./CompassLearning, Inc., 12.75% Sr. Sub. Nts., 11/15/09 1,100,000 1,007,875 ------------- 53,307,941 - ------------------------------------------------------------------------ MULTILINE RETAIL--0.1% Saks, Inc.: 8.25% Sr. Unsec. Nts., 11/15/08 250,000 271,875 9.875% Nts., 10/1/11 300,000 350,250 ------------- 622,125 - ------------------------------------------------------------------------ SPECIALTY RETAIL--1.1% Asbury Automotive Group, Inc., 9% Sr. Sub. Nts., 6/15/12 600,000 615,000 - ------------------------------------------------------------------------ Atlantic Broadband Finance LLC, 9.375% Sr. Sub. Nts., 1/15/14 5 500,000 475,000 - ------------------------------------------------------------------------ AutoNation, Inc., 9% Sr. Unsec. Nts., 8/1/08 1,200,000 1,362,000 - ------------------------------------------------------------------------ Building Materials Corp., 8% Sr. Nts., 12/1/08 300,000 302,250 - ------------------------------------------------------------------------ CSK Auto, Inc., 7% Sr. Sub. Nts., 1/15/14 5 800,000 766,000 - ------------------------------------------------------------------------ Finlay Fine Jewelry Corp., 8.375% Sr. Nts., 6/1/12 5 800,000 834,000 - ------------------------------------------------------------------------ Hollywood Entertainment Corp., 9.625% Sr. Sub. Nts., 3/15/11 300,000 346,500 - ------------------------------------------------------------------------ Petco Animal Supplies, Inc., 10.75% Sr. Sub. Nts., 11/1/11 750,000 843,750 - ------------------------------------------------------------------------ Rent-A-Center, Inc., 7.50% Sr. Unsec. Sub. Nts., Series B, 5/1/10 350,000 360,500 ------------- 5,905,000 - ------------------------------------------------------------------------ TEXTILES, APPAREL & LUXURY GOODS--0.7% Broder Bros. Co., 11.25% Sr. Unsec. Nts., 10/15/10 300,000 285,750 - ------------------------------------------------------------------------ Invista, Inc., 9.25% Sr. Nts., 5/1/12 5 1,400,000 1,414,000 - ------------------------------------------------------------------------ Levi Strauss & Co.: 7% Unsec. Nts., 11/1/06 300,000 281,625 11.625% Sr. Unsec. Nts., 1/15/08 100,000 98,500 12.25% Sr. Nts., 12/15/12 300,000 297,000 - ------------------------------------------------------------------------ Oxford Industries, Inc., 8.875% Sr. Nts., 6/1/11 5 500,000 530,000 - ------------------------------------------------------------------------ Russell Corp., 9.25% Sr. Nts., 5/1/10 600,000 640,500 ------------- 3,547,375 7 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ CONSUMER STAPLES--3.5% - ------------------------------------------------------------------------ BEVERAGES--0.1% Constellation Brands, Inc., 8.125% Sr. Sub. Nts., 1/15/12 $ 500,000 $ 535,000 - ------------------------------------------------------------------------ FOOD & STAPLES RETAILING--0.3% Great Atlantic & Pacific Tea Co., Inc. (The), 9.125% Sr. Nts., 12/15/11 457,000 390,735 - ------------------------------------------------------------------------ Ingles Markets, Inc., 8.875% Sr. Unsec. Sub. Nts., 12/1/11 57,000 58,853 - ------------------------------------------------------------------------ Real Time Data Co., 13% Disc. Nts., 5/31/09 1,3,4,8 476,601 -- - ------------------------------------------------------------------------ Rite Aid Corp.: 8.125% Sr. Sec. Nts., 5/1/10 900,000 951,750 9.50% Sr. Sec. Nts., 2/15/11 450,000 498,375 ------------- 1,899,713 - ------------------------------------------------------------------------ FOOD PRODUCTS--2.3% American Seafoods Group LLC, 10.125% Sr. Sub. Nts., 4/15/10 500,000 600,000 - ------------------------------------------------------------------------ Burns Philp Capital Property Ltd., 9.75% Sr. Unsec. Sub. Nts., 7/15/12 400,000 416,000 - ------------------------------------------------------------------------ Del Monte Corp.: 8.625% Sr. Sub. Nts., 12/15/12 1,000,000 1,082,500 9.25% Sr. Unsec. Sub. Nts., 5/15/11 100,000 109,750 - ------------------------------------------------------------------------ Doane Pet Care Co.: 9.75% Sr. Unsec. Sub. Nts., 5/15/07 900,000 834,750 10.75% Sr. Nts., 3/1/10 1,100,000 1,166,000 - ------------------------------------------------------------------------ Dole Food Co., Inc.: 8.625% Sr. Nts., 5/1/09 900,000 947,250 8.875% Sr. Unsec. Nts., 3/15/11 400,000 425,000 - ------------------------------------------------------------------------ Hines Nurseries, Inc., 10.25% Sr. Unsec. Sub. Nts., 10/1/11 1 600,000 657,000 - ------------------------------------------------------------------------ Pinnacle Foods Holding Corp.: 8.25% Sr. Sub. Nts., 12/1/13 5 500,000 485,000 8.25% Sr. Sub. Nts., 12/1/13 5 600,000 582,000 - ------------------------------------------------------------------------ Smithfield Foods, Inc.: 7.625% Sr. Unsec. Sub. Nts., 2/15/08 925,000 975,875 8% Sr. Nts., Series B, 10/15/09 900,000 974,250 - ------------------------------------------------------------------------ Swift & Co., 10.125% Sr. Nts., 10/1/09 1,000,000 1,072,500 - ------------------------------------------------------------------------ Tembec Industries, Inc.: 7.75% Sr. Nts., 3/15/12 700,000 679,000 8.50% Sr. Unsec. Nts., 2/1/11 57,000 57,855 - ------------------------------------------------------------------------ United Biscuits Finance plc, 10.625% Sr. Sub. Nts., 4/15/11 [EUR] 1,000,000 1,326,149 ------------- 12,390,879 - ------------------------------------------------------------------------ HOUSEHOLD PRODUCTS--0.7% AKI, Inc., 10.50% Sr. Unsec. Nts., 7/1/08 1,000,000 1,032,500 - ------------------------------------------------------------------------ Armkel LLC/Armkel Finance, Inc., 9.50% Sr. Sub. Nts., 8/15/09 600,000 658,500 - ------------------------------------------------------------------------ Playtex Products, Inc.: 8% Sr. Sec. Nts., 3/1/11 5 1,000,000 1,046,250 9.375% Sr. Unsec. Sub. Nts., 6/1/11 700,000 684,250 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HOUSEHOLD PRODUCTS CONTINUED Revlon Consumer Products Corp., 12% Sr. Sec. Nts., 12/1/05 $ 400,000 $ 450,000 - ------------------------------------------------------------------------ Styling Technology Corp., 10.875% Sr. Unsec. Sub. Nts., 7/1/08 1,3,4 600,000 -- ------------- 3,871,500 - ------------------------------------------------------------------------ PERSONAL PRODUCTS--0.1% Elizabeth Arden, Inc., 7.75% Sr. Sub. Nts., 1/15/14 5 300,000 306,750 - ------------------------------------------------------------------------ ENERGY--8.1% - ------------------------------------------------------------------------ ENERGY EQUIPMENT & SERVICES--1.5% BRL Universal Equipment Corp., 8.875% Sr. Sec. Nts., 2/15/08 750,000 807,188 - ------------------------------------------------------------------------ Dresser, Inc., 9.375% Sr. Sub. Nts., 4/15/11 400,000 430,000 - ------------------------------------------------------------------------ Grant Prideco Escrow Corp., 9% Sr. Unsec. Nts., 12/15/09 300,000 327,750 - ------------------------------------------------------------------------ Hanover Compress Co., 8.625% Sr. Nts., 12/15/10 700,000 728,000 - ------------------------------------------------------------------------ Hanover Equipment Trust 2001A, 8.50% Sr. Sec. Nts., Series A, 9/1/08 500,000 531,250 - ------------------------------------------------------------------------ Hornbeck-Leevac Marine Services, Inc., 10.625% Sr. Nts., 8/1/08 1,750,000 1,918,438 - ------------------------------------------------------------------------ Ocean Rig Norway AS, 10.25% Sr. Sec. Nts., 6/1/08 1,600,000 1,592,000 - ------------------------------------------------------------------------ Petroleum Helicopters, Inc., 9.375% Sr. Nts., 5/1/09 600,000 633,000 - ------------------------------------------------------------------------ Universal Compression, Inc., 7.25% Sr. Unsec. Sub. Nts., 5/15/10 800,000 830,000 ------------- 7,797,626 - ------------------------------------------------------------------------ OIL & GAS--6.6% ANR Pipeline Co., 8.875% Sr. Nts., 3/15/10 400,000 439,000 - ------------------------------------------------------------------------ Belden & Blake Corp., 9.875% Sr. Sub. Nts., 6/15/07 1,200,000 1,233,000 - ------------------------------------------------------------------------ Chesapeake Energy Corp.: 6.875% Sr. Unsec. Nts., 1/15/16 1,120,000 1,097,600 8.375% Sr. Unsec. Nts., 11/1/08 1,000,000 1,085,000 9% Sr. Nts., 8/15/12 300,000 339,000 - ------------------------------------------------------------------------ El Paso Corp., 7.875% Sr. Unsec. Nts., 6/15/12 957,000 863,693 - ------------------------------------------------------------------------ El Paso Energy Corp., 7.625% Nts., 7/15/11 350,000 314,125 - ------------------------------------------------------------------------ El Paso Energy Partners LP, 8.50% Sr. Unsec. Sub. Nts., Series B, 6/1/11 469,000 510,038 - ------------------------------------------------------------------------ El Paso Production Holding Co., 7.75% Sr. Unsec. Nts., 6/1/13 2,000,000 1,845,000 - ------------------------------------------------------------------------ EXCO Resources, Inc., 7.25% Sr. Nts., 1/15/11 800,000 816,000 - ------------------------------------------------------------------------ Forest Oil Corp., 7.75% Sr. Nts., 5/1/14 1,000,000 1,025,000 8 | OPPENHEIMER HIGH INCOME FUND/VA PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------- OIL & GAS Continued Frontier Oil Corp., 11.75% Sr. Nts., 11/15/09 $ 800,000 $ 878,000 - ------------------------------------------------------------------------ GulfTerra Energy Partners LP: 8.50% Sr. Unsec. Sub. Nts., Series B, 6/1/10 360,000 393,300 10.625% Sr. Sub. Nts., 12/1/12 469,000 560,455 - ------------------------------------------------------------------------ Newfield Exploration Co., 8.375% Sr. Sub. Nts., 8/15/12 600,000 654,000 - ------------------------------------------------------------------------ Paramount Resources Ltd., 7.875% Sr. Nts., 11/1/10 700,000 672,000 - ------------------------------------------------------------------------ Pioneer Natural Resources Co., 7.50% Sr. Nts., 4/15/12 1,000,000 1,134,122 - ------------------------------------------------------------------------ Plains Exploration & Production Co., 7.125% Sr. Nts., 6/15/14 5 600,000 613,500 - ------------------------------------------------------------------------ Premcor Refining Group, Inc.: 6.75% Sr. Nts., 5/1/14 700,000 696,500 9.50% Sr. Nts., 2/1/13 1,000,000 1,157,500 - ------------------------------------------------------------------------ Range Resources Corp., 7.375% Sr. Sub. Nts., 7/15/13 5 400,000 400,000 - ------------------------------------------------------------------------ Southern Natural Gas Co.: 7.35% Nts., 2/15/31 600,000 540,000 8% Sr. Unsub. Nts., 3/1/32 900,000 850,500 8.875% Sr. Nts., 3/15/10 700,000 768,250 - ------------------------------------------------------------------------ Stone Energy Corp., 8.25% Sr. Unsec. Sub. Nts., 12/15/11 800,000 838,000 - ------------------------------------------------------------------------ Teekay Shipping Corp., 8.875% Sr. Nts., 7/15/11 575,000 638,969 - ------------------------------------------------------------------------ Tennessee Gas Pipeline Co., 7.50% Bonds, 4/1/17 2,915,000 2,856,700 - ------------------------------------------------------------------------ Tesoro Petroleum Corp.: 8% Sr. Sec. Nts., 4/15/08 1,000,000 1,075,000 9.625% Sr. Sub. Nts., 4/1/12 557,000 628,018 - ------------------------------------------------------------------------ Transcontinental Gas Pipe Line Corp.: 6.125% Nts., 1/15/05 200,000 204,000 8.875% Sr. Unsub. Nts., Series B, 7/15/12 200,000 227,000 - ------------------------------------------------------------------------ Westport Resources Corp., 8.25% Sr. Unsec. Sub. Nts., 11/1/11 1,400,000 1,590,750 - ------------------------------------------------------------------------ Whiting Petroleum Corp., 7.25% Sr. Sub. Nts., 5/1/12 800,000 796,000 - ------------------------------------------------------------------------ Williams Cos., Inc. (The): 7.125% Nts., 9/1/11 2,850,000 2,907,000 8.625% Sr. Nts., 6/1/10 3,450,000 3,812,250 - ------------------------------------------------------------------------ Williams Holdings of Delaware, Inc., 6.50% Nts., 12/1/08 1 300,000 315,375 - ------------------------------------------------------------------------ XTO Energy, Inc., 7.50% Sr. Nts., 4/15/12 1,000,000 1,130,053 ------------- 35,904,698 - ------------------------------------------------------------------------ FINANCIALS--1.8% - ------------------------------------------------------------------------ CAPITAL MARKETS--0.9% American Color Graphics, Inc., 10% Sr. Sec. Nts., 6/15/10 400,000 359,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ CAPITAL MARKETS CONTINUED BCP Caylux Holdings Luxembourg SCA, 9.625% Sr. Sub. Nts., 6/15/14 5 $ 1,400,000 $ 1,457,750 - ------------------------------------------------------------------------ Berry Plastics Corp., 10.75% Sr. Sub. Nts., 7/15/12 1,600,000 1,784,000 - ------------------------------------------------------------------------ DeCrane Aircraft Holdings, Inc., 12% Sr. Unsec. Sub. Nts., Series B, 9/30/08 1,550,000 1,015,250 ------------- 4,616,000 - ------------------------------------------------------------------------ COMMERCIAL BANKS--0.3% Bank Plus Corp., 12% Sr. Nts., 7/18/07 517,000 557,068 - ------------------------------------------------------------------------ Local Financial Corp., 11% Sr. Nts., 9/8/04 1 800,000 812,000 - ------------------------------------------------------------------------ Western Financial Bank, 9.625% Unsec. Sub. Debs., 5/15/12 400,000 442,000 ------------- 1,811,068 - ------------------------------------------------------------------------ DIVERSIFIED FINANCIAL SERVICES--0.1% Global Cash Access LLC/Global Cash Finance Corp., 8.75% Sr. Sub. Nts., 3/15/12 5 575,000 600,875 - ------------------------------------------------------------------------ Noteco Ltd.: 7.02% Nts., Series B, 6/30/25 2 [GBP] 45,000 68,142 7.538% Nts., Series A1, 6/30/15 2 [GBP] 53,000 94,674 ------------- 763,691 - ------------------------------------------------------------------------ REAL ESTATE--0.5% Felcor Lodging LP: 9% Sr. Nts., 6/1/11 837,000 868,388 10% Sr. Unsec. Nts., 9/15/08 92,000 97,520 - ------------------------------------------------------------------------ HMH Properties, Inc., 7.875% Sr. Nts., Series B, 8/1/08 932,000 959,960 - ------------------------------------------------------------------------ MeriStar Hospitality Corp.: 9.125% Sr. Unsec. Nts., 1/15/11 457,000 463,855 10.50% Sr. Unsec. Nts., 6/15/09 350,000 374,500 ------------- 2,764,223 - ------------------------------------------------------------------------ HEALTH CARE--5.2% - ------------------------------------------------------------------------ BIOTECHNOLOGY--0.2% Polypore, Inc., 8.75% Sr. Sub. Nts., 5/15/12 5 800,000 838,000 - ------------------------------------------------------------------------ HEALTH CARE EQUIPMENT & SUPPLIES--0.8% Dade Behring Holdings, Inc., 11.91% Sr. Unsec. Sub. Nts., 10/3/10 182,317 209,665 - ------------------------------------------------------------------------ Fisher Scientific International, Inc., 8.125% Sr. Sub. Nts., 5/1/12 782,000 840,650 - ------------------------------------------------------------------------ HMP Equity Holdings Corp., Units (each unit consists of $1,000 principal amount of 15.43% sr. sec. disc. nts., 5/15/08 and one warrant to purchase 2.8094 shares of Huntsman Corp. common stock) 9,10 1,000,000 775,000 9 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HEALTH CARE EQUIPMENT & SUPPLIES Continued Inverness Medical Innovations, Inc., 8.75% Sr. Sub. Nts., 2/15/12 5 $ 600,000 $ 616,500 - ------------------------------------------------------------------------ Sybron Dental Specialties, Inc., 8.125% Sr. Sub. Nts., 6/15/12 1 700,000 752,500 - ------------------------------------------------------------------------ Universal Hospital Services, Inc., 10.125% Sr. Unsec. Nts., 11/1/11 1 800,000 816,000 - ------------------------------------------------------------------------ Vanguard Health Systems, Inc., 9.75% Sr. Unsec. Sub. Nts., 8/1/11 500,000 543,750 ------------- 4,554,065 - ------------------------------------------------------------------------ HEALTH CARE PROVIDERS & SERVICES--4.0% Alderwoods Group, Inc., 12.25% Sr. Nts., 1/2/09 700,000 777,000 - ------------------------------------------------------------------------ Alliance Imaging, Inc., 10.375% Sr. Unsec. Sub. Nts., 4/15/11 357,000 375,743 - ------------------------------------------------------------------------ AmeriPath, Inc., 10.50% Sr. Unsec. Sub. Nts., 4/1/13 700,000 710,500 - ------------------------------------------------------------------------ Beverly Enterprises, Inc., 7.875% Sr. Sub. Nts., 6/15/14 5 600,000 593,250 - ------------------------------------------------------------------------ Extendicare Health Services, Inc.: 6.875% Sr. Sub. Nts., 5/1/14 5 600,000 567,000 9.50% Sr. Unsec. Sub. Nts., 7/1/10 500,000 557,500 - ------------------------------------------------------------------------ Fresenius Medical Care Capital Trust II, 7.875% Nts., 2/1/08 1,600,000 1,692,000 - ------------------------------------------------------------------------ Genesis HealthCare Corp., 8% Sr. Sub. Nts., 10/15/13 5 400,000 410,000 - ------------------------------------------------------------------------ HCA, Inc.: 6.30% Sr. Unsec. Nts., 10/1/12 300,000 300,631 7.875% Sr. Nts., 2/1/11 305,000 334,949 8.75% Sr. Nts., 9/1/10 400,000 457,298 - ------------------------------------------------------------------------ HealthSouth Corp.: 7.625% Nts., 6/1/12 1,000,000 947,500 10.75% Sr. Unsec. Sub. Nts., 10/1/08 57,000 58,995 - ------------------------------------------------------------------------ InSight Health Services Corp., 9.875% Sr. Sub. Nts., 11/1/11 500,000 537,500 - ------------------------------------------------------------------------ Magellan Health Services, Inc., 9.375% Sr. Unsec. Nts., Series A, 11/15/08 1,867,643 2,012,385 - ------------------------------------------------------------------------ Medquest, Inc., 11.875% Sr. Unsec. Sub. Nts., Series B, 8/15/12 700,000 798,000 - ------------------------------------------------------------------------ National Nephrology Assn., 9% Sr. Sub. Nts., 11/1/11 5 200,000 230,000 - ------------------------------------------------------------------------ NDCHealth Corp., 10.50% Sr. Unsec. Sub. Nts., 12/1/12 600,000 664,500 - ------------------------------------------------------------------------ PacifiCare Health Systems, Inc., 10.75% Sr. Unsec. Unsub. Nts., 6/1/09 714,000 817,530 - ------------------------------------------------------------------------ Quintiles Transnational Corp., 10% Sr. Sub. Nts., 10/1/13 600,000 597,000 - ------------------------------------------------------------------------ Rotech Healthcare, Inc., 9.50% Sr. Unsec. Sub. Nts., 4/1/12 600,000 643,500 - ------------------------------------------------------------------------ Stewart Enterprises, Inc., 10.75% Sr. Unsec. Sub. Nts., 7/1/08 1,800,000 2,009,250 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ HEALTH CARE PRODUCTS & SERVICES CONTINUED Tenet Healthcare Corp.: 6.375% Sr. Nts., 12/1/11 $ 1,260,000 $ 1,108,800 7.375% Nts., 2/1/13 57,000 51,870 9.875% Sr. Nts., 7/1/14 5 500,000 511,250 - ------------------------------------------------------------------------ Triad Hospitals, Inc.: 7% Sr. Nts., 5/15/12 900,000 911,250 7% Sr. Sub. Nts., 11/15/13 1,920,000 1,833,600 - ------------------------------------------------------------------------ US Oncology, Inc., 9.625% Sr. Sub. Nts., 2/1/12 300,000 355,500 - ------------------------------------------------------------------------ Vicar Operating, Inc., 9.875% Sr. Sub. Nts., 12/1/09 1,000,000 1,105,000 ------------- 21,969,301 - ------------------------------------------------------------------------ PHARMACEUTICALS--0.2% aaiPharma, Inc., 11% Sr. Sub. Nts., 4/1/10 100,000 84,000 - ------------------------------------------------------------------------ Valeant Pharmaceuticals International, Inc., 7% Sr. Nts., 12/15/11 5 800,000 784,000 ------------- 868,000 - ------------------------------------------------------------------------ INDUSTRIALS--8.4% - ------------------------------------------------------------------------ AEROSPACE & DEFENSE--1.1% Alliant Techsystems, Inc., 8.50% Sr. Unsec. Sub. Nts., 5/15/11 900,000 976,500 - ------------------------------------------------------------------------ Argo-Tech Corp., 9.25% Sr. Nts., 6/1/11 5 400,000 414,000 - ------------------------------------------------------------------------ BE Aerospace, Inc.: 8% Sr. Unsec. Sub. Nts., Series B, 3/1/08 300,000 280,500 8.875% Sr. Unsec. Sub. Nts., 5/1/11 57,000 53,295 - ------------------------------------------------------------------------ K&F Industries, Inc., 9.625% Sr. Unsec. Sub. Nts., 12/15/10 300,000 330,375 - ------------------------------------------------------------------------ L-3 Communications Holdings, Inc., 7.625% Sr. Sub. Nts., 6/15/12 800,000 848,000 - ------------------------------------------------------------------------ Rexnord Corp., 10.125% Sr. Unsec. Sub. Nts., 12/15/12 700,000 773,500 - ------------------------------------------------------------------------ TD Funding Corp., 8.375% Sr. Sub. Nts., 7/15/11 800,000 816,000 - ------------------------------------------------------------------------ TRW Automotive, Inc.: 9.375% Sr. Nts., 2/15/13 580,000 656,850 11% Sr. Sub. Nts., 2/15/13 454,000 537,990 - ------------------------------------------------------------------------ Vought Aircraft Industries, Inc., 8% Sr. Nts., 7/15/115 300,000 286,500 ------------- 5,973,510 - ------------------------------------------------------------------------ AIR FREIGHT & LOGISTICS--0.0% Atlas Air, Inc., 9.25% Sr. Nts., 4/15/08 3,4 500,000 237,500 - ------------------------------------------------------------------------ AIRLINES--0.4% America West Airlines, Inc., 10.75% Sr. Nts., 9/1/05 1,000,000 985,000 - ------------------------------------------------------------------------ ATA Holdings Corp., 13% Sr. Unsec. Nts., 2/1/09 1,575,000 1,110,375 ------------- 2,095,375 10 | OPPENHEIMER HIGH INCOME FUND/VA PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ BUILDING PRODUCTS--0.5% Associated Materials, Inc., 9.75% Sr. Sub. Nts., 4/15/12 $ 700,000 $ 780,500 - ------------------------------------------------------------------------ Green Star Products, Inc., 10.15% Bonds, 6/24/10 5 303,652 304,805 - ------------------------------------------------------------------------ Jacuzzi Brands, Inc., 9.625% Sr. Sec. Nts., 7/1/10 544,000 584,800 - ------------------------------------------------------------------------ Nortek, Inc., 9.875% Sr. Unsec. Sub. Nts., 6/15/11 1 400,000 458,000 - ------------------------------------------------------------------------ North America Energy Partners, Inc., 8.75% Sr. Unsec. Nts., 12/1/11 5 300,000 298,500 ------------- 2,426,605 - ------------------------------------------------------------------------ COMMERCIAL SERVICES & SUPPLIES--3.2% Allied Waste North America, Inc.: 7.375% Sr. Unsec. Nts., 4/15/14 5 300,000 293,250 7.875% Sr. Nts., 4/15/13 1,500,000 1,575,000 8.50% Sr. Sub. Nts., 12/1/08 1,000,000 1,098,750 8.875% Sr. Nts., Series B, 4/1/08 1,500,000 1,650,000 9.25% Sr. Sec. Debs., Series B, 9/1/12 1,700,000 1,912,500 - ------------------------------------------------------------------------ American Pad & Paper Co., 13% Sr. Sub. Nts., Series B, 11/15/05 1,3,4 200,000 -- - ------------------------------------------------------------------------ Budget Group, Inc., 9.125% Sr. Unsec. Nts., 4/1/06 1,3,4 900,000 159,750 - ------------------------------------------------------------------------ Buhrmann US, Inc., 12.25% Sr. Unsec. Sub. Nts., 11/1/09 600,000 660,358 - ------------------------------------------------------------------------ Coinmach Corp., 9% Sr. Nts., 2/1/10 800,000 806,000 - ------------------------------------------------------------------------ Comforce Operating, Inc., 12% Sr. Nts., Series B, 12/1/07 1 350,000 329,000 - ------------------------------------------------------------------------ Corrections Corp. of America: 7.50% Sr. Nts., 5/1/11 500,000 507,500 9.875% Sr. Nts., 5/1/09 500,000 557,500 - ------------------------------------------------------------------------ Hydrochem Industrial Services, Inc., 10.375% Sr. Sub. Nts., 8/1/07 1 250,000 253,125 - ------------------------------------------------------------------------ Kindercare Learning Centers, Inc., 9.50% Sr. Sub. Nts., 2/15/09 576,000 587,520 - ------------------------------------------------------------------------ Mail-Well I Corp.: 7.875% Sr. Sub. Nts., 12/1/13 5 1,600,000 1,464,000 9.625% Sr. Nts., 3/15/12 700,000 756,000 - ------------------------------------------------------------------------ Protection One, Inc./Protection One Alarm Monitoring, Inc., 7.375% Sr. Unsec. Nts., 8/15/05 900,000 859,500 - ------------------------------------------------------------------------ Stericycle, Inc., 12.375% Sr. Unsec. Sub. Nts., Series B, 11/15/09 488,000 534,360 - ------------------------------------------------------------------------ Synagro Technologies, Inc., 9.50% Sr. Sub. Nts., 4/1/09 700,000 735,000 - ------------------------------------------------------------------------ United Rentals, Inc., 7% Sr. Sub. Nts., 2/15/14 2,100,000 1,879,500 - ------------------------------------------------------------------------ Waste Services, Inc., 9.50% Sr. Sub. Nts., 4/15/14 5 600,000 618,000 ------------- 17,236,613 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ CONSTRUCTION & ENGINEERING--0.1% Integrated Electrical Services, Inc.: 9.375% Sr. Sub. Nts., Series B, 2/1/09 $ 45,000 $ 46,688 9.375% Sr. Sub. Nts., Series C, 2/1/09 100,000 103,750 - ------------------------------------------------------------------------ URS Corp., 11.50% Sr. Unsec. Nts., 9/15/09 455,000 524,388 ------------- 674,826 - ------------------------------------------------------------------------ ELECTRICAL EQUIPMENT--0.2% Dayton Superior Corp., 13% Sr. Unsec. Sub. Nts., 6/15/09 100,000 87,500 - ------------------------------------------------------------------------ General Cable Corp., 9.50% Sr. Nts., 11/15/10 500,000 540,000 - ------------------------------------------------------------------------ Riverside Forest Products Ltd., 7.875% Sr. Nts., 3/1/14 5 600,000 615,000 ------------- 1,242,500 - ------------------------------------------------------------------------ INDUSTRIAL CONGLOMERATES--0.3% Great Lakes Dredge & Dock Co., 7.75% Sr. Unsec. Sub. Nts., 12/15/13 550,000 467,500 - ------------------------------------------------------------------------ Norse CBO Ltd., 9.342% Sub. Bonds, Series 1A, Cl. C2, 8/13/10 1 1,500,000 1,305,000 ------------- 1,772,500 - ------------------------------------------------------------------------ MACHINERY--1.6% Actuant Corp., 13% Sr. Sub. Nts., 5/1/09 378,000 455,490 - ------------------------------------------------------------------------ AGCO Corp., 9.50% Sr. Unsec. Nts., 5/1/08 1,000,000 1,095,000 - ------------------------------------------------------------------------ Manitowoc Co., Inc. (The): 7.125% Sr. Nts., 11/1/13 150,000 150,750 10.50% Sr. Sub. Nts., 8/1/12 800,000 920,000 - ------------------------------------------------------------------------ Milacron Escrow Corp., 11.50% Sr. Sec. Nts., 5/15/11 5 1,200,000 1,200,000 - ------------------------------------------------------------------------ Navistar International Corp., 7.50% Sr. Nts., 6/15/11 800,000 824,000 - ------------------------------------------------------------------------ NMHG Holding Co., 10% Sr. Nts., 5/15/09 600,000 663,000 - ------------------------------------------------------------------------ SPX Corp., 7.50% Sr. Nts., 1/1/13 900,000 927,000 - ------------------------------------------------------------------------ Terex Corp.: 7.375% Sr. Unsec. Sub. Nts., 1/15/14 500,000 492,500 9.25% Sr. Unsec. Sub. Nts., 7/15/11 800,000 876,000 10.375% Sr. Unsec. Sub. Nts., Series B, 4/1/11 500,000 560,000 - ------------------------------------------------------------------------ Trinity Industries, Inc., 6.50% Sr. Nts., 3/15/14 5 600,000 552,000 ------------- 8,715,740 - ------------------------------------------------------------------------ MARINE--0.4% CP Ships Ltd., 10.375% Sr. Nts., 7/15/12 1,000,000 1,147,500 - ------------------------------------------------------------------------ Millenium Seacarriers, Inc., 12% Sr. Sec. Nts., 7/15/05 1,3,4 700,000 179,410 - ------------------------------------------------------------------------ Navigator Gas Transport plc, 10.50% First Priority Ship Mtg. Nts., 6/30/07 1,3,4 1,000,000 589,100 11 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ MARINE Continued Pacific & Atlantic Holdings, Inc., 3.75% Sec. Nts., 12/31/07 5 $ 407,840 $ 177,900 ------------- 2,093,910 - ------------------------------------------------------------------------ ROAD & RAIL--0.4% Kansas City Southern Railway Co. (The), 7.50% Sr. Nts., 6/15/09 500,000 502,500 - ------------------------------------------------------------------------ Stena AB: 7.50% Sr. Unsec. Nts., 11/1/13 928,000 922,200 9.625% Sr. Nts., 12/1/12 600,000 669,000 ------------- 2,093,700 - ------------------------------------------------------------------------ TRANSPORTATION INFRASTRUCTURE--0.2% Horizon Lines LLC, 9% Nts., 11/1/12 5,6 600,000 612,750 - ------------------------------------------------------------------------ Worldspan LP/Worldspan Financial Corp., 9.625% Sr. Nts., 6/15/11 350,000 358,750 ------------- 971,500 - ------------------------------------------------------------------------ INFORMATION TECHNOLOGY--1.7% - ------------------------------------------------------------------------ COMMUNICATIONS EQUIPMENT--0.1% Orion Network Systems, Inc., 12.50% Sr. Unsub. Disc. Nts., 1/15/07 1,3,4 1,150,000 419,750 - ------------------------------------------------------------------------ COMPUTERS & PERIPHERALS--0.1% Seagate Technology Hdd Holdings, 8% Sr. Nts., 5/15/09 700,000 735,000 - ------------------------------------------------------------------------ ELECTRONIC EQUIPMENT & INSTRUMENTS--0.4% Ingram Micro, Inc., 9.875% Sr. Unsec. Sub. Nts., 8/15/08 1,200,000 1,320,000 - ------------------------------------------------------------------------ Insilco Corp., 12% Sr. Sub. Nts., 8/15/07 1,3,4 1,200,000 -- - ------------------------------------------------------------------------ Sensus Metering System, Inc., 8.625% Sr. Sub. Nts., 12/15/13 5 1,000,000 965,000 ------------- 2,285,000 - ------------------------------------------------------------------------ INTERNET SOFTWARE & SERVICES--0.0% Exodus Communications, Inc., 10.75% Sr. Nts., 12/15/09 1,3,4 [EUR] 846,550 46,348 - ------------------------------------------------------------------------ Globix Corp., 11% Sr. Nts., 4/26/08 71,480 64,689 - ------------------------------------------------------------------------ NorthPoint Communications Group, Inc., 12.875% Nts., 2/15/10 1,3,4 240,208 24 - ------------------------------------------------------------------------ PSINet, Inc.: 10.50% Sr. Unsec. Nts., 12/1/06 1,3,4 [EUR] 1,000,000 47,906 11% Sr. Nts., 8/1/091,3,4 901,558 49,586 - ------------------------------------------------------------------------ Verado Holdings, Inc., 13% Sr. Disc. Nts., 4/15/08 1,3,4 500,000 50 ------------- 208,603 - ------------------------------------------------------------------------ IT SERVICES--0.5% Iron Mountain, Inc.: 7.75% Sr. Sub. Nts., 1/15/15 500,000 498,750 8.625% Sr. Unsec. Sub. Nts., 4/1/13 1,600,000 1,704,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ IT SERVICES CONTINUED Titan Corp. (The), 8% Sr. Sub. Nts., 5/15/11 5 $ 400,000 $ 406,000 ------------- 2,608,750 - ------------------------------------------------------------------------ SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--0.6% AMI Semiconductor, Inc., 10.75% Sr. Unsec. Sub. Nts., 2/1/13 1 682,000 799,645 - ------------------------------------------------------------------------ Amkor Technology, Inc.: 7.75% Sr. Nts., 5/15/13 600,000 571,500 9.25% Sr. Unsec. Sub. Nts., 2/15/08 1,000,000 1,050,000 - ------------------------------------------------------------------------ ChipPAC International Co. Ltd., 12.75% Sr. Unsec. Sub. Nts., Series B, 8/1/09 500,000 536,250 ------------- 2,957,395 - ------------------------------------------------------------------------ MATERIALS--10.5% - ------------------------------------------------------------------------ CHEMICALS--3.2% Avecia Group plc, 11% Sr. Unsec. Nts., 7/1/09 200,000 153,000 - ------------------------------------------------------------------------ ClimaChem, Inc., 10.75% Sr. Unsec. Nts., Series B, 12/1/07 250,000 102,500 - ------------------------------------------------------------------------ Compass Minerals Group, Inc., 10% Sr. Sub. Nts., 8/15/11 1,200,000 1,338,000 - ------------------------------------------------------------------------ Equistar Chemicals LP/Equistar Funding Corp.: 8.75% Sr. Unsec. Nts., 2/15/09 400,000 419,000 10.125% Sr. Unsec. Nts., 9/1/08 57,000 62,700 10.625% Sr. Unsec. Nts., 5/1/11 1,800,000 2,007,000 - ------------------------------------------------------------------------ Huntsman Co. LLC: 11.50% Sr. Nts., 7/15/12 5 900,000 915,750 11.625% Sr. Unsec. Nts., 10/15/10 57,000 63,270 - ------------------------------------------------------------------------ Huntsman Corp./ICI Chemical Co. plc: 13.09% Sr. Unsec. Disc. Nts., 12/31/09 10 400,000 198,000 10.125% Sr. Unsec. Sub. Nts., 7/1/09 [EUR] 100,000 119,840 10.125% Sr. Unsec. Sub. Nts., 7/1/09 2,700,000 2,767,500 - ------------------------------------------------------------------------ Huntsman International LLC, 9.875% Sr. Nts., 3/1/09 2,000,000 2,170,000 - ------------------------------------------------------------------------ IMC Global, Inc.: 7.625% Bonds, 11/1/05 1 3,000 3,075 10.875% Sr. Unsec. Nts., 8/1/13 57,000 68,258 - ------------------------------------------------------------------------ ISP Chemco, Inc., 10.25% Sr. Unsec. Sub. Nts., 7/1/11 500,000 558,750 - ------------------------------------------------------------------------ ISP Holdings, Inc., 10.625% Sr. Sec. Nts., 12/15/09 300,000 331,500 - ------------------------------------------------------------------------ Lyondell Chemical Co.: 9.50% Sec. Nts., 12/15/08 57,000 59,708 9.50% Sr. Sec. Nts., 12/15//08 100,000 105,000 9.625% Sr. Sec. Nts., Series A, 5/1/07 900,000 945,000 9.875% Sec. Nts., Series B, 5/1/07 600,000 630,000 - ------------------------------------------------------------------------ PCI Chemicals Canada, 10% Sr. Sec. Nts., 12/31/08 319,909 305,513 12 | OPPENHEIMER HIGH INCOME FUND/VA PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ CHEMICALS Continued Pioneer Cos., Inc., 5.086% Sr. Sec. Nts., 12/31/06 2 $ 101,304 $ 96,239 - ------------------------------------------------------------------------ PolyOne Corp.: 8.875% Sr. Unsec. Nts., 5/1/12 1,750,000 1,732,500 10.625% Sr. Unsec. Nts., 5/15/10 357,000 380,205 - ------------------------------------------------------------------------ Resolution Performance Products LLC: 8% Sr. Sec. Nts., 12/15/09 450,000 469,125 13.50% Sr. Unsec. Sub. Nts., 11/15/10 300,000 281,250 - ------------------------------------------------------------------------ Rockwood Specialties, Inc., 10.625% Sr. Unsec. Sub. Nts., 5/15/11 400,000 428,000 - ------------------------------------------------------------------------ Sterling Chemicals, Inc.: 10% Sr. Sec. Nts., 12/19/07 409,135 388,678 11.25% Sr. Sub. Nts., 8/15/06 1,3,4 300,000 -- - ------------------------------------------------------------------------ Westlake Chemical Corp., 8.75% Sr. Nts., 7/15/11 1 400,000 436,000 ------------- 17,535,361 - ------------------------------------------------------------------------ CONSTRUCTION MATERIALS--0.2% Texas Industries, Inc., 10.25% Sr. Unsec. Nts., 6/15/11 800,000 896,000 - ------------------------------------------------------------------------ CONTAINERS & PACKAGING--2.9% Crown Euro Holdings SA, 9.50% Sr. Sec. Nts., 3/1/11 900,000 985,500 - ------------------------------------------------------------------------ Graphic Packaging International Corp.: 8.50% Sr. Nts., 8/15/11 1,000,000 1,075,000 9.50% Sr. Sub. Nts., 8/15/13 700,000 763,000 - ------------------------------------------------------------------------ Jefferson Smurfit Corp.: 7.50% Sr. Unsec. Unsub. Nts., 6/1/13 350,000 348,250 8.25% Sr. Unsec. Nts., 10/1/12 900,000 940,500 - ------------------------------------------------------------------------ MDP Acquisitions plc, 9.625% Sr. Nts., 10/1/12 800,000 880,000 - ------------------------------------------------------------------------ Owens-Brockway Glass Container, Inc.: 7.75% Sr. Sec. Nts., 5/15/11 1,000,000 1,045,000 8.25% Sr. Unsec. Nts., 5/15/13 557,000 577,888 8.75% Sr. Sec. Nts., 11/15/12 1,350,000 1,471,500 8.875% Sr. Sec. Nts., 2/15/09 1,300,000 1,410,500 - ------------------------------------------------------------------------ Pliant Corp., 0%/11.125% Sr. Sec. Disc. Nts., 6/15/09 5,7 600,000 508,500 - ------------------------------------------------------------------------ Solo Cup Co., 8.50% Sr. Sub. Nts., 2/15/14 5 1,500,000 1,402,500 - ------------------------------------------------------------------------ Stone Container Corp.: 8.375% Sr. Nts., 7/1/12 750,000 787,500 9.25% Sr. Unsec. Nts., 2/1/08 1,000,000 1,097,500 9.75% Sr. Unsec. Nts., 2/1/11 1,000,000 1,105,000 - ------------------------------------------------------------------------ TriMas Corp., 9.875% Sr. Unsec. Sub. Nts., 6/15/12 1,000,000 1,065,000 ------------- 15,463,138 - ------------------------------------------------------------------------ METALS & MINING--2.7% AK Steel Corp.: 7.75% Sr. Unsec. Nts., 6/15/12 57,000 51,728 7.875% Sr. Unsec. Nts., 2/15/09 300,000 282,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ METALS & MINING CONTINUED Arch Western Finance LLC, 6.75% Sr. Nts., 7/1/13 5 $ 800,000 $ 804,000 - ------------------------------------------------------------------------ California Steel Industries, Inc., 6.125% Sr. Nts., 3/15/14 800,000 750,000 - ------------------------------------------------------------------------ Century Aluminum Co., 11.75% Sr. Sec. Nts., 4/15/08 1,385,000 1,551,200 - ------------------------------------------------------------------------ IMCO Recycling, Inc., 10.375% Sr. Sec. Nts., 10/15/10 700,000 759,500 - ------------------------------------------------------------------------ IPSCO, Inc., 8.75% Sr. Nts., 6/1/13 300,000 336,000 - ------------------------------------------------------------------------ Ispat Inland ULC, 9.75% Sr. Sec. Nts., 4/1/14 5 1,800,000 1,863,000 - ------------------------------------------------------------------------ Jorgensen (Earle M.) Co., 9.75% Sr. Sec. Nts., 6/1/12 1 800,000 880,000 - ------------------------------------------------------------------------ Kaiser Aluminum & Chemical Corp., 10.875% Sr. Nts., Series B, 10/15/06 3,4 1,000,000 1,052,500 - ------------------------------------------------------------------------ Koppers Industry, Inc., 9.875% Sr. Sec. Nts., 10/15/13 900,000 990,000 - ------------------------------------------------------------------------ Massey Energy Co., 6.625% Sr. Nts., 11/15/10 400,000 400,000 - ------------------------------------------------------------------------ Metallurg, Inc., 11% Sr. Nts., 12/1/07 740,000 373,700 - ------------------------------------------------------------------------ Northwest Pipeline Corp., 8.125% Sr. Nts., 3/1/10 200,000 216,500 - ------------------------------------------------------------------------ Oregon Steel Mills, Inc., 10% Sr. Nts., 7/15/09 1,300,000 1,384,500 - ------------------------------------------------------------------------ Peabody Energy Corp., 6.875% Sr. Unsec. Nts., Series B, 3/15/13 1,000,000 1,017,500 - ------------------------------------------------------------------------ Steel Dynamics, Inc., 9.50% Sr. Nts., 3/15/09 400,000 444,000 - ------------------------------------------------------------------------ UCAR Finance, Inc., 10.25% Sr. Nts., 2/15/12 400,000 447,000 - ------------------------------------------------------------------------ United States Steel Corp., 9.75% Sr. Nts., 5/15/10 505,000 561,813 - ------------------------------------------------------------------------ United States Steel LLC, 10.75% Sr. Nts., 8/1/08 389,000 446,378 ------------- 14,611,319 - ------------------------------------------------------------------------ PAPER & FOREST PRODUCTS--1.5% Abitibi-Consolidated, Inc., 8.55% Nts., 8/1/10 300,000 317,830 - ------------------------------------------------------------------------ Appleton Papers, Inc., 8.125% Sr. Nts., 6/15/11 5 600,000 610,500 - ------------------------------------------------------------------------ Buckeye Technologies, Inc., 8.50% Sr. Nts., 10/1/13 350,000 355,250 - ------------------------------------------------------------------------ Doman Industries Ltd., 8.75% Sr. Nts., 3/15/04 1,3,4 2,000,000 745,000 - ------------------------------------------------------------------------ Georgia-Pacific Corp.: 8.125% Sr. Unsec. Nts., 5/15/11 2,200,000 2,442,000 9.375% Sr. Unsec. Nts., 2/1/13 1,600,000 1,840,000 - ------------------------------------------------------------------------ Inland Fiber Group LLC, 9.625% Sr. Unsec. Nts., 11/15/07 3 300,000 151,500 13 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ PAPER & FOREST PRODUCTS Continued Norske Skog Canada Ltd., 7.375% Sr. Nts., 3/1/14 5 $ 600,000 $ 583,500 - ------------------------------------------------------------------------ Tekni-Plex, Inc., 8.75% Sr. Sec. Nts., 11/15/13 5 1,257,000 1,206,720 ------------- 8,252,300 - ------------------------------------------------------------------------ TELECOMMUNICATION SERVICES--9.8% - ------------------------------------------------------------------------ DIVERSIFIED TELECOMMUNICATION SERVICES--3.8% 360networks, Inc., 13% Sr. Unsec. Nts., 5/1/08 1,3,4 [EUR] 500,000 -- - ------------------------------------------------------------------------ American Tower Corp., 9.375% Sr. Nts., 2/1/09 850,000 911,625 - ------------------------------------------------------------------------ COLO.com, Inc., 13.875% Sr. Nts., 3/15/10 1,3,4 499,755 50 - ------------------------------------------------------------------------ Crown Castle International Corp., 7.50% Sr. Nts., 12/1/13 900,000 900,000 - ------------------------------------------------------------------------ Dex Media East LLC/Dex Media East Finance Co., 9.875% Sr. Unsec. Nts., 11/15/09 800,000 902,000 - ------------------------------------------------------------------------ Dex Media West LLC/ Dex Media West Finance Co.: 8.50% Sr. Nts., 8/15/10 700,000 766,500 9.875% Sr. Sub. Nts., 8/15/13 1,200,000 1,323,000 - ------------------------------------------------------------------------ Dex Media, Inc., 8% Nts., 11/15/13 5 3,100,000 2,991,500 - ------------------------------------------------------------------------ IPC Acquisition Corp., 11.50% Sr. Sub. Nts., 12/15/09 350,000 379,750 - ------------------------------------------------------------------------ Level 3 Communications, Inc.: 9.125% Sr. Unsec. Nts., 5/1/08 57,000 45,458 10.50% Sr. Disc. Nts., 12/1/08 100,000 79,750 - ------------------------------------------------------------------------ MCI, Inc.: 5.908% Sr. Unsec. Nts., 5/1/07 179,000 174,078 6.688% Sr. Unsec. Nts., 5/1/09 179,000 166,023 7.735% Sr. Unsec. Nts., 5/1/14 153,000 137,318 - ------------------------------------------------------------------------ Qwest Capital Funding, Inc., 7.90% Unsec. Nts., 8/15/10 57,000 50,730 - ------------------------------------------------------------------------ Qwest Corp.: 7.20% Unsec. Nts., 11/1/04 400,000 405,000 8.875% Nts., 3/15/12 5 2,100,000 2,278,500 - ------------------------------------------------------------------------ Qwest Services Corp., 13.50% Nts., 12/15/10 5 4,800,000 5,604,000 - ------------------------------------------------------------------------ Telewest Communications plc: 0%/9.875% Sr. Disc. Nts., 4/15/09 3,4,7 [GBP] 500,000 385,369 9.25% Sr. Disc. Nts., 4/15/09 3,4 1,000,000 485,000 11.25% Sr. Nts., 11/1/08 3,4 800,000 472,000 - ------------------------------------------------------------------------ Teligent, Inc., 11.50% Sr. Nts., 12/1/07 1,3,4 400,000 -- - ------------------------------------------------------------------------ Time Warner Telecom LLC/ Time Warner Telecom, Inc., 9.75% Sr. Nts., 7/15/08 750,000 705,000 - ------------------------------------------------------------------------ Time Warner Telecom, Inc., 10.125% Sr. Unsec. Sub. Nts., 2/1/11 1,650,000 1,509,750 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ DIVERSIFIED TELECOMMUNICATION SERVICES CONTINUED Winstar Communications, Inc., 12.75% Sr. Nts., 4/15/10 1,3,4 $ 1,000,000 $ -- ------------- 20,672,401 - ------------------------------------------------------------------------ WIRELESS TELECOMMUNICATION SERVICES--6.0% Alamosa Delaware, Inc.: 8.50% Sr. Nts., 1/31/12 5 1,000,000 985,000 11% Sr. Unsec. Nts., 7/31/10 57,000 62,415 12.50% Sr. Unsec. Nts., 2/1/11 100,000 111,500 - ------------------------------------------------------------------------ American Cellular Corp., 10% Sr. Nts., Series B, 8/1/11 1,575,000 1,366,313 - ------------------------------------------------------------------------ American Tower Corp., 7.50% Sr. Nts., 5/1/12 5 1,550,000 1,507,375 - ------------------------------------------------------------------------ American Tower Escrow Corp., 12.25% Sr. Sub. Disc. Nts., 8/1/08 10 1,400,000 1,029,000 - ------------------------------------------------------------------------ CellNet Data Systems, Inc., Sr. Unsec. Disc. Nts., 10/1/07 1,3,4 1,834,000 -- - ------------------------------------------------------------------------ Centennial Cellular Operating Co./ Centennial Communications Corp., 10.125% Sr. Nts., 6/15/13 1,700,000 1,763,750 - ------------------------------------------------------------------------ Crown Castle International Corp., 10.75% Sr. Nts., 8/1/11 2,050,000 2,306,250 - ------------------------------------------------------------------------ Dobson Communications Corp.: 8.875% Sr. Nts., 10/1/13 1,707,000 1,305,855 10.875% Sr. Unsec. Nts., 7/1/10 1,800,000 1,557,000 - ------------------------------------------------------------------------ IPCS, Inc., 0%/14% Sr. Unsec. Disc. Nts., 7/15/10 3,4,7 350,000 190,750 - ------------------------------------------------------------------------ Leap Wireless International, Inc.: 0%/14.50% Sr. Unsec. Disc. Nts., 4/15/10 1,3,4,7 400,000 58,000 12.50% Sr. Nts., 4/15/10 1,3,4 400,000 71,000 - ------------------------------------------------------------------------ Nextel Communications, Inc.: 7.375% Sr. Nts., 8/1/15 5,490,000 5,572,350 9.50% Sr. Unsec. Nts., 2/1/11 1,200,000 1,350,000 - ------------------------------------------------------------------------ Nextel Partners, Inc.: 8.125% Sr. Nts., 7/1/11 700,000 717,500 12.50% Sr. Nts., 11/15/09 1,162,000 1,359,540 - ------------------------------------------------------------------------ Rural Cellular Corp.: 8.25% Sr. Sec. Nts., 3/15/12 5 775,000 796,313 9.625% Sr. Sub. Nts., Series B, 5/15/08 950,000 902,500 9.75% Sr. Sub. Nts., 1/15/10 957,000 873,263 9.875% Sr. Nts., 2/1/10 1,100,000 1,097,250 - ------------------------------------------------------------------------ SBA Communications Corp., 10.25% Sr. Unsec. Nts., 2/1/09 1,900,000 1,957,000 - ------------------------------------------------------------------------ SBA Telecommunications, Inc./ SBA Communications Corp., 0%/9.75% Sr. Disc. Nts., 12/15/11 5,7 1,557,000 1,159,965 - ------------------------------------------------------------------------ Triton PCS, Inc.: 8.50% Sr. Unsec. Nts., 6/1/13 800,000 760,000 8.75% Sr. Unsec. Sub. Nts., 11/15/11 357,000 296,310 9.375% Sr. Unsec. Sub. Nts., 2/1/11 300,000 258,000 14 | OPPENHEIMER HIGH INCOME FUND/VA PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ WIRELESS TELECOMMUNICATION SERVICES Continued UbiquiTel Operating Co., 9.875% Sr. Nts., 3/1/11 5 $ 1,100,000 $ 1,105,500 - ------------------------------------------------------------------------ US Unwired, Inc.: 0%/13.375% Sr. Unsec. Sub. Disc. Nts., Series B, 11/1/09 7 800,000 808,000 10% Sr. Sec. Nts., 6/15/12 500,000 507,500 - ------------------------------------------------------------------------ Western Wireless Corp., 9.25% Sr. Unsec. Nts., 7/15/13 857,000 886,995 ------------- 32,722,194 - ------------------------------------------------------------------------ UTILITIES--6.1% - ------------------------------------------------------------------------ ELECTRIC UTILITIES--3.8% AES Corp. (The): 5.22% Nts., 1/1/15 [GBP] 61,000 110,623 6.22% Nts., 1/1/20 [GBP] 11,000 19,949 8.75% Sr. Sec. Nts., 5/15/13 5 1,150,000 1,237,688 10% Sec. Nts., 7/15/05 5 355,135 364,902 - ------------------------------------------------------------------------ Allegheny Energy Supply Co. LLC, 8.25% Bonds, 4/15/12 5 57,000 56,644 - ------------------------------------------------------------------------ Allegheny Energy, Inc., 7.75% Nts., 8/1/05 300,000 312,000 - ------------------------------------------------------------------------ Caithness Coso Funding Corp., 9.05% Sr. Sec. Nts., Series B, 12/15/09 397,819 435,611 - ------------------------------------------------------------------------ Calpine Corp.: 7.625% Sr. Nts., 4/15/06 2,950,000 2,610,750 8.75% Sr. Nts., 7/15/07 800,000 572,000 8.75% Sr. Sec. Nts., 7/15/13 5 100,000 82,500 9.875% Sr. Sec. Nts., 12/1/11 5 1,000,000 855,000 - ------------------------------------------------------------------------ CMS Energy Corp.: 7.50% Sr. Nts., 1/15/09 357,000 357,000 7.75% Sr. Nts., 8/1/10 5 400,000 400,000 9.875% Sr. Unsec. Nts., 10/15/07 1,400,000 1,515,500 - ------------------------------------------------------------------------ CMS Energy X-TRAS Pass-Through Trust I, 7% Sr. Unsec. Pass-Through Certificates, 1/15/05 500,000 505,000 - ------------------------------------------------------------------------ Edison Mission Energy, 10% Sr. Unsec. Nts., 8/15/08 200,000 214,500 - ------------------------------------------------------------------------ ESI Tractebel Acquisition Corp., 7.99% Sec. Bonds, Series B, 12/30/11 1 922,000 954,270 - ------------------------------------------------------------------------ Midwest Generation LLC, 8.75% Sr. Sec. Nts., 5/1/34 5 2,600,000 2,639,000 - ------------------------------------------------------------------------ Mirant Americas Generation LLC, 8.30% Sr. Unsec. Nts., 5/1/11 3,4 200,000 151,000 - ------------------------------------------------------------------------ MSW Energy Holdings LLC/ MSW Energy Finance Co., Inc.: 7.375% Sr. Sec. Nts., 9/1/10 5 700,000 700,000 8.50% Sr. Sec. Nts., 9/1/10 400,000 425,000 - ------------------------------------------------------------------------ NRG Energy, Inc., 8% Sr. Sec. Nts., 12/15/13 5 2,000,000 2,030,000 - ------------------------------------------------------------------------ PG&E Corp., 6.875% Sr. Sec. Nts., 7/15/08 5 800,000 840,000 PRINCIPAL MARKET VALUE AMOUNT SEE NOTE 1 - ------------------------------------------------------------------------ ELECTRIC UTILITIES CONTINUED Reliant Resources, Inc.: 9.25% Sr. Sec. Nts., 7/15/10 $ 1,657,000 $ 1,777,133 9.50% Sr. Sec. Nts., 7/15/13 1,200,000 1,299,000 ------------- 20,465,070 - ------------------------------------------------------------------------ GAS UTILITIES--0.4% AmeriGas Partners LP/AmeriGas Eagle Finance Corp., 8.875% Sr. Unsec. Nts., Series B, 5/20/11 1,400,000 1,498,000 - ------------------------------------------------------------------------ SEMCO Energy, Inc.: 7.125% Sr. Nts., 5/15/08 400,000 412,000 7.75% Sr. Nts., 5/15/13 400,000 414,000 ------------- 2,324,000 - ------------------------------------------------------------------------ MULTI-UTILITIES & UNREGULATED POWER--1.9% AES Red Oak LLC, 8.54% Sr. Sec. Bonds, Series A, 11/30/19 1,053,731 1,098,515 - ------------------------------------------------------------------------ Aquila, Inc., 7% Sr. Unsec. Nts., 7/15/04 300,000 299,625 - ------------------------------------------------------------------------ Calpine Canada Energy Finance ULC, 8.50% Sr. Unsec. Nts., 5/1/08 1,257,000 835,905 - ------------------------------------------------------------------------ Consumers Energy Co.: 6.25% Nts., 9/15/06 300,000 315,341 6.375% Sr. Sec. Nts., 2/1/08 450,000 477,763 7.375% Nts., 9/15/23 350,000 356,873 - ------------------------------------------------------------------------ Dynegy Holdings, Inc.: 6.875% Sr. Unsec. Unsub. Nts., 4/1/11 3,040,000 2,633,400 8.75% Sr. Nts., 2/15/12 1,857,000 1,773,435 10.125% Sr. Sec. Nts., 7/15/13 5 1,400,000 1,522,500 - ------------------------------------------------------------------------ Mirant Mid-Atlantic LLC, 8.625% Sec. Pass-Through Certificates, Series A, 6/30/12 799,332 823,811 ------------- 10,137,168 - ------------------------------------------------------------------------ WATER UTILITIES--0.0% National Waterworks, Inc., 10.50% Sr. Unsec. Sub. Nts., Series B, 12/1/12 300,000 334,500 ------------- Total Corporate Bonds and Notes (Cost $420,508,724) 426,110,771 SHARES - ------------------------------------------------------------------------ PREFERRED STOCKS--0.7% - ------------------------------------------------------------------------ AmeriKing, Inc., 13% Cum. Sr. Exchangeable, Non-Vtg. 1,4,8 13,764 138 - ------------------------------------------------------------------------ Dobson Communications Corp., 6% Cv., Series F (converts into Dobson Communications Corp., Cl. A common stock), Non-Vtg. 800 78,035 - ------------------------------------------------------------------------ e.spire Communications, Inc., 12.75% Jr. Redeemable, Non-Vtg. 1,4,8 498 50 - ------------------------------------------------------------------------ Eagle-Picher Holdings, Inc., 11.75% Cum. Exchangeable, Series B, Non-Vtg. 1,4 8,000 702,000 15 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF INVESTMENTS Unaudited / Continued - -------------------------------------------------------------------------------- MARKET VALUE SHARES SEE NOTE 1 - ------------------------------------------------------------------------ PREFERRED STOCKS Continued - ------------------------------------------------------------------------ Focal Communications Corp., Cv., Series A 1,4 538 $ 5,434 - ------------------------------------------------------------------------ ICG Holdings, Inc., 14.25% Exchangeable, Non-Vtg. 1,4,8 342 -- - ------------------------------------------------------------------------ McLeodUSA, Inc., 2.50% Cv., Series A 4 3,258 8,474 - ------------------------------------------------------------------------ Nebco Evans Holdings, Inc., 11.25% Sr. Redeemable Exchangeable, Non-Vtg. 1,4,8 7,274 -- - ------------------------------------------------------------------------ Pacific & Atlantic Holdings, Inc., 7.50% Cum. Cv., Series A 1,4,8 21,193 42,386 - ------------------------------------------------------------------------ Paxson Communications Corp.: 14.25% Cum. 4,8 1 668 14.25% Cum. Jr. Exchangeable, Non-Vtg. 8 86 755,725 - ------------------------------------------------------------------------ PTV, Inc., 10% Cum., Series A, Non-Vtg 23 176 - ------------------------------------------------------------------------ Rural Cellular Corp., 11.375% Cum., Series B, Non-Vtg. 4,8 1,177 997,508 - ------------------------------------------------------------------------ Sovereign Real Estate Investment Trust, 12% Non-Cum., Series A 1 10,000 1,462,500 ------------- Total Preferred Stocks (Cost $5,115,632) 4,053,094 - ------------------------------------------------------------------------ COMMON STOCKS--1.2% - ------------------------------------------------------------------------ AboveNet, Inc. 4 559 16,211 - ------------------------------------------------------------------------ AES Drax Group Ltd. 4 11,000 7,720 - ------------------------------------------------------------------------ Aurora Foods, Inc., Equity Trust Interests 1,4 301 390,333 - ------------------------------------------------------------------------ Charles River Laboratories International, Inc. 4 8,360 408,553 - ------------------------------------------------------------------------ Chesapeake Energy Corp. 100,909 1,485,380 - ------------------------------------------------------------------------ Classic Cable, Inc. 4 2,645 -- - ------------------------------------------------------------------------ Covad Communications Group, Inc. 4 20,660 49,584 - ------------------------------------------------------------------------ Dobson Communications Corp., Cl. A 4 51,491 167,861 - ------------------------------------------------------------------------ Equinix, Inc. 4 16,434 557,770 - ------------------------------------------------------------------------ Globix Corp. 4 11,467 33,254 - ------------------------------------------------------------------------ Gulfstream Holding, Inc. 1,4 56 -- - ------------------------------------------------------------------------ Horizon Natural Resources Co. 1,4 20,000 -- - ------------------------------------------------------------------------ ICO Global Communication Holdings Ltd. 1,4 42,107 21,896 - ------------------------------------------------------------------------ Magellan Health Services, Inc. 4 9,849 329,449 - ------------------------------------------------------------------------ Manitowoc Co., Inc. (The) 1,039 35,170 - ------------------------------------------------------------------------ MCI, Inc. 4 1,629 23,506 - ------------------------------------------------------------------------ Microcell Telecommunications, Inc., Cl. A 4 15 362 - ------------------------------------------------------------------------ Microcell Telecommunications, Inc., Cl. B 4 3,711 89,402 - ------------------------------------------------------------------------ NTL, Inc. 4 18,902 1,089,133 MARKET VALUE SHARES SEE NOTE 1 - ------------------------------------------------------------------------ COMMON STOCK CONTINUED Orbital Sciences Corp. 4 2,235 $ 30,865 - ------------------------------------------------------------------------ Pioneer Cos., Inc. 4 20,688 147,092 - ------------------------------------------------------------------------ Polymer Group, Inc., Cl. A 4 24,040 314,924 - ------------------------------------------------------------------------ Prandium, Inc. 4 62,829 3,456 - ------------------------------------------------------------------------ Sterling Chemicals, Inc. 4 396 9,702 - ------------------------------------------------------------------------ TVMAX Holdings, Inc. 1,4 7,500 33,188 - ------------------------------------------------------------------------ UnitedGlobalCom, Inc., Cl. A 4 143,824 1,044,162 - ------------------------------------------------------------------------ Viatel Holding Ltd. (Bermuda) 1,4 2,701 3,309 - ------------------------------------------------------------------------ WRC Media Corp. 1,4 1,353 27 - ------------------------------------------------------------------------ XO Communications, Inc. 4 2,646 10,981 ------------- Total Common Stocks (Cost $6,757,316) 6,303,290 UNITS - ------------------------------------------------------------------------ RIGHTS, WARRANTS AND CERTIFICATES--0.1% - ------------------------------------------------------------------------ AboveNet, Inc. Wts.: Exp. 9/8/08 1,4 235 2,844 Exp. 9/8/10 1,4 276 3,152 - ------------------------------------------------------------------------ American Tower Corp. Wts., Exp. 8/1/08 1,4 1,400 266,700 - ------------------------------------------------------------------------ ASAT Finance LLC Wts., Exp. 11/1/06 1,4 500 625 - ------------------------------------------------------------------------ Chesapeake Energy Corp. Wts., Exp. 9/1/04 4 2,671 196 - ------------------------------------------------------------------------ Citigroup, Inc. Wts., Exp. 12/31/50 4 15,626 13,595 - ------------------------------------------------------------------------ COLO.com, Inc. Wts., Exp. 3/15/10 1,4 600 6 - ------------------------------------------------------------------------ Concentric Network Corp. Wts., Exp. 12/15/07 1,4 750 -- - ------------------------------------------------------------------------ Covergent Communications, Inc. Wts., Exp. 4/1/08 1,4 2,000 20 - ------------------------------------------------------------------------ DeCrane Aircraft Holdings, Inc. Wts., Exp. 9/30/08 1,4 1,750 -- - ------------------------------------------------------------------------ Diva Systems Corp. Wts., Exp. 3/1/08 1,4 1,500 -- - ------------------------------------------------------------------------ e.spire Communications, Inc. Wts., Exp. 11/1/05 1,4 475 5 - ------------------------------------------------------------------------ Focal Communications Corp. Wts.: Exp. 6/19/06 1,4 211 760 Exp. 6/19/08 4 1,056 -- - ------------------------------------------------------------------------ Horizon PCS, Inc. Wts., Exp. 10/1/10 1,4 1,300 -- - ------------------------------------------------------------------------ ICG Communications, Inc. Wts., Exp. 9/15/05 1,4 5,940 59 - ------------------------------------------------------------------------ ICO Global Communication Holdings Ltd. Wts.: Exp. 5/16/06 1,4 10,561 106 Exp. 5/16/06 1,4 16 -- - ------------------------------------------------------------------------ Imperial Credit Industries, Inc. Wts., Exp. 1/31/08 1,4 5,148 -- - ------------------------------------------------------------------------ Insilco Corp. Wts., Exp. 8/15/07 1,4 765 -- - ------------------------------------------------------------------------ IPCS, Inc. Wts., Exp. 6/15/10 1,4 750 8 16 | OPPENHEIMER HIGH INCOME FUND/VA MARKET VALUE UNITS SEE NOTE 1 - ------------------------------------------------------------------------ RIGHTS, WARRANTS AND CERTIFICATES Continued - ------------------------------------------------------------------------ Leap Wireless International, Inc. Wts., Exp. 4/15/10 1,4 550 $ -- - ------------------------------------------------------------------------ Long Distance International, Inc. Wts., Exp. 4/13/08 1,4 800 -- - ------------------------------------------------------------------------ Loral Space & Communications Ltd. Wts., Exp. 1/15/07 1,4 800 8 - ------------------------------------------------------------------------ McLeodUSA, Inc. Wts., Exp. 4/16/07 4 7,220 1,011 - ------------------------------------------------------------------------ Microcell Telecommunications, Inc., Cl. A Wts., Exp. 5/1/05 4 687 6,359 - ------------------------------------------------------------------------ Microcell Telecommunications, Inc., Cl. B Wts., Exp. 5/1/08 4 1,145 10,120 - ------------------------------------------------------------------------ Millenium Seacarriers, Inc. Wts., Exp. 7/15/05 1,4 1,500 15 - ------------------------------------------------------------------------ Ntelos, Inc. Wts., Exp. 8/15/10 1,4 1,000 10 - ------------------------------------------------------------------------ Pathmark Stores, Inc. Wts., Exp. 9/19/10 4 20,000 17,000 - ------------------------------------------------------------------------ Protection One, Inc. Wts., Exp. 6/30/05 1,4 1,600 -- - ------------------------------------------------------------------------ Republic Technologies International LLC Wts., Exp. 7/15/09 1,4 500 1 - ------------------------------------------------------------------------ Sterling Chemicals, Inc. Wts., Exp 12/19/08 1,4 647 938 - ------------------------------------------------------------------------ Telergy, Inc. Wts., Exp. 9/25/10 1,4 2,019 -- - ------------------------------------------------------------------------ Telus Corp. Wts., Exp. 9/15/05 4 1,079 5,289 - ------------------------------------------------------------------------ Transocean, Inc. Wts., Exp. 5/1/09 4,5 1,000 244,125 - ------------------------------------------------------------------------ XO Communications, Inc., Cl. A Wts., Exp. 1/16/10 4 5,300 7,929 - ------------------------------------------------------------------------ XO Communications, Inc., Cl. B Wts., Exp. 1/16/10 4 3,975 4,174 - ------------------------------------------------------------------------ XO Communications, Inc., Cl. C Wts., Exp. 1/16/10 4 3,975 2,842 ------------- Total Rights, Warrants and Certificates (Cost $173,006) 587,897 PRINCIPAL AMOUNT - ------------------------------------------------------------------------ STRUCTURED NOTES--4.8% - ------------------------------------------------------------------------ JPMorgan Chase Bank, TRAC-X NA High Yield T3 Credit Linked Nts., 8%, 3/25/09 5 (Cost $26,900,000) $26,900,000 26,143,438 - ------------------------------------------------------------------------ JOINT REPURCHASE AGREEMENTS--12.1% 11 - ------------------------------------------------------------------------ Undivided interest of 5.26% in joint repurchase agreement (Principal Amount/ Market Value $1,249,774,000, with a maturity value of $1,249,822,255) with UBS Warburg LLC, 1.39%, dated 6/30/04, to be repurchased at $65,705,537 on 7/1/04, collateralized by Federal Home Loan Mortgage Corp., 4.50%, 6/1/19, with a value of $340,921,875 and Federal National Mortgage Assn., 4.50%--5%, 4/1/19--3/1/34, with a value of $937,433,252 (Cost $65,703,000) 65,703,000 65,703,000 - ------------------------------------------------------------------------ TOTAL INVESTMENTS, AT VALUE (COST $527,020,071) 97.6% 529,885,468 - ------------------------------------------------------------------------ OTHER ASSETS NET OF LIABILITIES 2.4 12,758,666 ----------------------------- NET ASSETS 100.0% $ 542,644,134 ============================= FOOTNOTES TO STATEMENT OF INVESTMENTS PRINCIPAL AMOUNT IS REPORTED IN U.S. DOLLARS, EXCEPT FOR THOSE DENOTED IN THE FOLLOWING CURRENCIES: EUR Euro GBP British Pound Sterling 1. Identifies issues considered to be illiquid. See Note 8 of Notes to Financial Statements. 2. Represents the current interest rate for a variable or increasing rate security. 3. Issue is in default. See Note 1 of Notes to Financial Statements. 4. Non-income producing security. 5. 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 $101,393,375 or 18.69% of the Fund's net assets as of June 30, 2004. 6. When-issued security or forward commitment to be delivered and settled after June 30, 2004. See Note 1 of Notes to Financial Statements. 7. Denotes a step bond: a zero coupon bond that converts to a fixed or variable interest rate at a designated future date. 8. Interest or dividend is paid-in-kind. 9. Units may be comprised of several components, such as debt and equity and/or warrants to purchase equity at some point in the future. For units, which represent debt securities, principal amount disclosed represents total underlying principal. 10. Zero coupon bond reflects effective yield on the date of purchase. 11. The Fund may have elements of risk due to concentrated investments. Such concentrations may subject the Fund to additional risks. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 17 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF ASSETS AND LIABILITIES Unaudited - -------------------------------------------------------------------------------- June 30, 2004 - --------------------------------------------------------------------------- ASSETS - --------------------------------------------------------------------------- Investments, at value (including cost and market value of $65,703,000 in repurchase agreements) (cost $527,020,071)--see accompanying statement of investments $ 529,885,468 - --------------------------------------------------------------------------- Cash 295,187 - --------------------------------------------------------------------------- Unrealized appreciation on swap contracts 779,443 - --------------------------------------------------------------------------- Receivables and other assets: Interest, dividends and principal paydowns 9,736,697 Investments sold 4,872,355 Shares of beneficial interest sold 2,176,763 Other 8,128 -------------- Total assets 547,754,041 - --------------------------------------------------------------------------- LIABILITIES - --------------------------------------------------------------------------- Payables and other liabilities: Investments purchased (including $1,600,000 purchased on a when-issued basis or forward commitment) 4,120,968 Shares of beneficial interest redeemed 880,985 Distribution and service plan fees 57,651 Shareholder communications 30,451 Trustees' compensation 9,997 Transfer and shareholder servicing agent fees 1,650 Other 8,205 -------------- Total liabilities 5,109,907 - --------------------------------------------------------------------------- NET ASSETS $ 542,644,134 ============== - --------------------------------------------------------------------------- COMPOSITION OF NET ASSETS - --------------------------------------------------------------------------- Par value of shares of beneficial interest $ 66,107 - --------------------------------------------------------------------------- Additional paid-in capital 625,038,003 - --------------------------------------------------------------------------- Accumulated net investment income 18,325,407 - --------------------------------------------------------------------------- Accumulated net realized loss on investments and foreign currency transactions (104,430,512) - --------------------------------------------------------------------------- Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies 3,645,129 -------------- NET ASSETS $ 542,644,134 ============== - --------------------------------------------------------------------------- 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 $445,664,847 and 54,257,526 shares of beneficial interest outstanding) $ 8.21 - --------------------------------------------------------------------------- Service Shares: Net asset value, redemption price per share and offering price per share (based on net assets of $96,979,287 and 11,849,303 shares of beneficial interest outstanding) $ 8.18 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 18 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENT OF OPERATIONS Unaudited - -------------------------------------------------------------------------------- For the Six Months Ended June 30, 2004 - ------------------------------------------------------------------------------- INVESTMENT INCOME - ------------------------------------------------------------------------------- Interest $ 21,563,349 - ------------------------------------------------------------------------------- Dividends 120,693 - ------------------------------------------------------------------------------- Portfolio lending fees 6,683 --------------- Total investment income 21,690,725 - ------------------------------------------------------------------------------- EXPENSES - ------------------------------------------------------------------------------- Management fees 1,972,703 - ------------------------------------------------------------------------------- Distribution and service plan fees--Service shares 109,813 - ------------------------------------------------------------------------------- Transfer and shareholder servicing agent fees: Non-Service shares 4,993 Service shares 4,990 - ------------------------------------------------------------------------------- Shareholder communications: Non-Service shares 17,063 Service shares 3,088 - ------------------------------------------------------------------------------- Trustees' compensation 8,628 - ------------------------------------------------------------------------------- Custodian fees and expenses 6,488 - ------------------------------------------------------------------------------- Other 16,032 --------------- Total expenses 2,143,798 Less reduction to custodian expenses (3,819) --------------- Net expenses 2,139,979 - ------------------------------------------------------------------------------- NET INVESTMENT INCOME 19,550,746 - ------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) - ------------------------------------------------------------------------------- Net realized gain on: Investments 5,175,116 Closing of futures contracts 28,401 Foreign currency transactions 4,170 Swap contracts 195,656 --------------- Net realized gain 5,403,343 - ------------------------------------------------------------------------------- Net change in unrealized appreciation on: Investments (16,935,649) Translation of assets and liabilities denominated in foreign (173,056) currencies Futures contracts (5,880) Swap contracts 779,443 --------------- Net change in unrealized appreciation (16,335,142) - ------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 8,618,947 =============== SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 19 | OPPENHEIMER HIGH INCOME FUND/VA STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
SIX MONTHS YEAR ENDED ENDED JUNE 30, 2004 DECEMBER 31, (UNAUDITED) 2003 - ------------------------------------------------------------------------------------------------- OPERATIONS - ------------------------------------------------------------------------------------------------- Net investment income $ 19,550,746 $ 36,198,271 - ------------------------------------------------------------------------------------------------- Net realized gain (loss) 5,403,343 (3,373,657) - ------------------------------------------------------------------------------------------------- Net change in unrealized appreciation (depreciation) (16,335,142) 60,265,270 ------------------------------- Net increase in net assets resulting from operations 8,618,947 93,089,884 - ------------------------------------------------------------------------------------------------- DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS - ------------------------------------------------------------------------------------------------- Dividends from net investment income: Non-Service shares (29,416,204) (26,819,814) Service shares (5,469,874) (1,672,018) - ------------------------------------------------------------------------------------------------- BENEFICIAL INTEREST TRANSACTIONS - ------------------------------------------------------------------------------------------------- Net increase (decrease) in net assets resulting from beneficial interest transactions: Non-Service shares (12,390,377) 76,658,765 Service shares 24,836,261 51,833,851 - ------------------------------------------------------------------------------------------------- NET ASSETS - ------------------------------------------------------------------------------------------------- Total increase (decrease) (13,821,247) 193,090,668 - ------------------------------------------------------------------------------------------------- Beginning of period 556,465,381 363,374,713 ------------------------------- End of period (including accumulated net investment income of $18,325,407 and $33,660,739, respectively) $ 542,644,134 $ 556,465,381 ===============================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 20 | OPPENHEIMER HIGH INCOME FUND/VA FINANCIAL HIGHLIGHTS - --------------------------------------------------------------------------------
SIX MONTHS YEAR ENDED ENDED JUNE 30, 2004 DECEMBER 31, NON-SERVICE SHARES (UNAUDITED) 2003 2002 2001 2000 1999 - ------------------------------------------------------------------------------------------------------------------------------ PER SHARE OPERATING DATA - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, beginning of period $ 8.61 $ 7.51 $ 8.54 $ 9.27 $ 10.72 $ 11.02 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income .32 .60 .58 .84 1.00 1.01 Net realized and unrealized gain (loss) (.18) 1.09 (.76) (.62) (1.36) (.55) ------------------------------------------------------------------------------- Total from investment operations .14 1.69 (.18) .22 (.36) .46 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and/or distributions to shareholders: Dividends from net investment income (.54) (.59) (.85) (.95) (1.09) (.76) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $ 8.21 $ 8.61 $ 7.51 $ 8.54 $ 9.27 $ 10.72 =============================================================================== - ------------------------------------------------------------------------------------------------------------------------------ TOTAL RETURN, AT NET ASSET VALUE 1 1.66% 23.96% (2.40)% 1.97% (3.74)% 4.29% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ RATIOS/SUPPLEMENTAL DATA - ------------------------------------------------------------------------------------------------------------------------------ Net assets, end of period (in thousands) $ 445,665 $ 480,112 $ 345,670 $ 344,788 $ 333,533 $ 340,829 - ------------------------------------------------------------------------------------------------------------------------------ Average net assets (in thousands) $ 460,330 $ 396,858 $ 335,894 $ 347,723 $ 329,260 $ 340,519 - ------------------------------------------------------------------------------------------------------------------------------ Ratios to average net assets: 2 Net investment income 7.20% 8.31% 8.29% 9.94% 10.47% 9.61% Total expenses 0.74% 3 0.76% 3 0.77% 3 0.79% 3 0.79% 3 0.75% 3 - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate 22% 48% 75% 46% 31% 33%
1. 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. 2. Annualized for periods of less than one full year. 3. Reduction to custodian expenses less than 0.01%. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 21 | OPPENHEIMER HIGH INCOME FUND/VA FINANCIAL HIGHLIGHTS Continued - --------------------------------------------------------------------------------
SIX MONTHS YEAR ENDED ENDED JUNE 30, 2004 DECEMBER 31, SERVICE SHARES (UNAUDITED) 2003 2002 2001 1 - ------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA - ------------------------------------------------------------------------------------------------------------- Net asset value, beginning of period $ 8.58 $ 7.49 $ 8.54 $ 8.40 - ------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .27 .61 .88 .20 Net realized and unrealized gain (loss) (.14) 1.06 (1.08) (.06) -------------------------------------------------------- Total from investment operations .13 1.67 (.20) .14 - ------------------------------------------------------------------------------------------------------------- Dividends and/or distributions to shareholders: Dividends from net investment income (.53) (.58) (.85) -- - ------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 8.18 $ 8.58 $ 7.49 $ 8.54 ======================================================== - ------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE 2 1.53% 23.79% (2.67)% 1.67% - ------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA - ------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $ 96,979 $ 76,354 $ 17,705 $ 3 - ------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 88,449 $ 41,246 $ 5,602 $ 2 - ------------------------------------------------------------------------------------------------------------- Ratios to average net assets: 3 Net investment income 6.97% 7.84% 8.91% 12.51% Total expenses 1.00% 4 1.04% 4 1.02% 4,5 0.96% 4 - ------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 22% 48% 75% 46%
1. For the period from September 18, 2001 (inception of offering) to December 31, 2001. 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. Voluntary waiver of transfer agent fees less than 0.01%. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 22 | OPPENHEIMER HIGH INCOME FUND/VA NOTES TO FINANCIAL STATEMENTS Unaudited - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. SIGNIFICANT ACCOUNTING POLICIES Oppenheimer High Income Fund/VA (the Fund) is a separate series of Oppenheimer Variable Account Funds (the Trust), an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund's investment objective is to seek a high level of current income from investment in high-yield fixed-income securities. The Trust's investment advisor is OppenheimerFunds, Inc. (the Manager). The Fund offers two classes of shares. Both classes are sold at their offering price, which is the net asset value per share, to separate investment accounts of participating insurance companies as an underlying investment for variable life insurance policies, variable annuity contracts or other investment products. The class of shares designated as Service shares is subject to a distribution and service plan. Both classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. The following is a summary of significant accounting policies consistently followed by the Fund. - -------------------------------------------------------------------------------- SECURITIES VALUATION. The Fund calculates the net asset value of its shares as of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for business. Securities listed or traded on National Stock Exchanges or other domestic or foreign exchanges are valued based on the last sale price of the security traded on that exchange prior to the time when the Fund's assets are valued. Securities traded on NASDAQ are valued based on the closing price provided by NASDAQ prior to the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the closing bid and asked prices, and if not, at the closing bid price. 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 June 30, 2004, the market value of these securities comprised 4.8% of the Fund's net assets and resulted in unrealized cumulative losses of $756,562. - -------------------------------------------------------------------------------- SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis or forward commitment can take place up to ten days or more after the trade date. Normally the settlement date occurs within six months after the trade date; however, the Fund may, from time to time, purchase securities whose settlement date extends six months or more beyond trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The Fund maintains internally designated assets with a market value equal to or greater than the amount of its purchase commitments. The purchase of securities on a when-issued basis or forward commitment may increase the volatility of the Fund's net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. The Fund may also sell securities that it purchased on a when-issued basis or 23 | OPPENHEIMER HIGH INCOME FUND/VA NOTES TO FINANCIAL STATEMENTS Unaudited / Continued - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. SIGNIFICANT ACCOUNTING POLICIES Continued forward commitment prior to settlement of the original purchase. As of June 30, 2004, the Fund had purchased $1,600,000 (principal amount) of securities on a when-issued basis or forward commitment. - -------------------------------------------------------------------------------- SECURITY CREDIT RISK. The Fund invests in high-yield securities, which may be subject to a greater degree of credit risk, market fluctuations and loss of income and principal, and may be more sensitive to economic conditions than lower-yielding, higher-rated fixed-income securities. The Fund may acquire securities in default, and is not obligated to dispose of securities whose issuers subsequently default. As of June 30, 2004, securities with an aggregate market value of $8,812,543, representing 1.62% 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. Amounts related to the purchase and sale of foreign securities and investment income are translated at the rates of exchange prevailing on the respective dates of such transactions. Foreign exchange rates may be valued primarily using dealer supplied valuations or a portfolio pricing service authorized by the Board of Trustees. Reported net realized foreign exchange gains or losses arise from sales of portfolio securities, sales and maturities of short-term securities, sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund's books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the values of assets and liabilities, including investments in securities at fiscal period end, resulting from changes in exchange rates. The effect of changes in foreign currency exchange rates on investments is separately identified from the fluctuations arising from changes in market values of securities held and reported with all other foreign currency gains and losses in the Fund's Statement of Operations. - -------------------------------------------------------------------------------- JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along with other affiliated funds advised by the Manager, may transfer uninvested cash balances into joint trading accounts on a daily basis. These balances are invested in one or more repurchase agreements. Securities pledged as collateral for repurchase agreements are held by a custodian bank until the agreements mature. Each agreement requires that the market value of the collateral be sufficient to cover payments of interest and principal. In the event of default by the other party to the agreement, retention of the collateral may be subject to legal proceedings. - -------------------------------------------------------------------------------- ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class. - -------------------------------------------------------------------------------- FEDERAL TAXES. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. 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. As of June 30, 2004, the Fund had available for federal income tax purposes an estimated capital loss carryforward of $101,814,604 expiring by 2011. This estimated capital loss carryforward represents carryforward as of the end of the last fiscal year, increased for losses deferred under tax accounting rules to the current fiscal year and is increased or decreased by capital losses or gains realized in the first six months of the current fiscal year. During the six months 24 | OPPENHEIMER HIGH INCOME FUND/VA ended June 30, 2004, it is estimated that the Fund will utilize $5,403,343 of capital loss carryforward to offset realized capital gains. During the year ended December 31, 2003, the Fund did not utilize any capital loss carryforward to offset realized capital gains. As of December 31, 2003, the Fund had available for federal income tax purposes post-October losses of $22,882 and unused capital loss carryforwards as follows: EXPIRING ----------------------------- 2006 $ 3,401,577 2007 4,933,260 2008 11,572,833 2009 22,696,701 2010 56,061,391 2011 8,529,303 ------------- Total $ 107,195,065 ============= - -------------------------------------------------------------------------------- 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 does purchase 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. - -------------------------------------------------------------------------------- EXPENSE OFFSET ARRANGEMENT. The reduction of custodian fees, if applicable, represents earnings on cash balances maintained by the Fund. - -------------------------------------------------------------------------------- SECURITY TRANSACTIONS. Security transactions are recorded on the trade date. Realized gains and losses on securities sold are determined on the basis of identified cost. - -------------------------------------------------------------------------------- OTHER. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. 25 | OPPENHEIMER HIGH INCOME FUND/VA NOTES TO FINANCIAL STATEMENTS Unaudited / 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:
SIX MONTHS ENDED JUNE 30, 2004 YEAR ENDED DECEMBER 31, 2003 SHARES AMOUNT SHARES AMOUNT - ------------------------------------------------------------------------------------------------------------- NON-SERVICE SHARES Sold 15,183,171 $ 127,902,838 28,774,062 $ 229,684,313 Dividends and/or distributions reinvested 3,591,722 29,416,204 3,719,807 26,819,814 Redeemed (20,264,656) (169,709,419) (22,801,608) (179,845,362) --------------------------------------------------------------- Net increase (decrease) (1,489,763) $ (12,390,377) 9,692,261 $ 76,658,765 =============================================================== SERVICE SHARES Sold 7,237,759 $ 60,908,288 13,073,333 $ 104,602,083 Dividends and/or distributions reinvested 669,507 5,469,874 232,224 1,672,018 Redeemed (4,954,358) (41,541,901) (6,772,325) (54,440,250) --------------------------------------------------------------- Net increase 2,952,908 $ 24,836,261 6,533,232 $ 51,833,851 ===============================================================
- -------------------------------------------------------------------------------- 3. PURCHASES AND SALES OF SECURITIES The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations, for the six months ended June 30, 2004, were $124,585,661 and $98,827,013, respectively. - -------------------------------------------------------------------------------- 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the investment advisory agreement with the Trust which provides for a fee at an annual rate of 0.75% of the first $200 million of average annual net assets, 0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the next $200 million, 0.60% on the next $200 million and 0.50% of average annual net assets over $1 billion. - -------------------------------------------------------------------------------- ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund's tax returns. - -------------------------------------------------------------------------------- TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. The Fund pays OFS a per account fee. For the six months ended June 30, 2004, the Fund paid $9,996 to OFS for services to the Fund. Additionally, funds offered in variable annuity separate accounts are subject to minimum fees of $10,000 per class for class level assets of $10 million or more. Each class is subject to the minimum fee in the event that the per account fee does not equal or exceed the applicable minimum fee. - -------------------------------------------------------------------------------- DISTRIBUTION AND SERVICE PLAN FOR SERVICE SHARES. The Fund has adopted a Distribution and Service Plan for Service shares to pay OppenheimerFunds Distributor, Inc. (the Distributor), for distribution related services and personal service and account maintenance for the Fund's Service shares. Under the Plan, payments are made quarterly at an annual rate of up to 0.25% of the average annual net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsor(s) of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. The impact of the service plan is to increase operating expenses of the Service shares, which results in lower performance compared to the Fund's shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations. 26 | OPPENHEIMER HIGH INCOME 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 June 30, 2004, the Fund had no outstanding foreign currency contracts. - -------------------------------------------------------------------------------- 6. FUTURES CONTRACTS A futures contract is a commitment to buy or sell a specific amount of a commodity or financial instrument at a negotiated price on a stipulated future date. Futures contracts are traded on a commodity exchange. The Fund may buy and sell futures contracts that relate to broadly based securities indices (financial futures) or debt securities (interest rate futures) in order to gain exposure to or protection from changes in market value of stocks and bonds or interest rates. The Fund may also buy or write put or call options on these futures contracts. The Fund generally sells futures contracts as a hedge against increases in interest rates and decreases in market value of portfolio securities. The Fund may also purchase futures contracts to gain exposure to market changes as it may be more efficient or cost effective than actually buying securities. Upon entering into a futures contract, the Fund is required to deposit either cash or securities (initial margin) in an amount equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the Fund each day. The variation margin payments are equal to the daily changes in the contract value and are recorded as unrealized gains and losses. The Fund recognizes a realized gain or loss when the contract is closed or has expired. Cash held by the broker to cover initial margin requirements on open futures contracts is noted in the Statement of Assets and Liabilities. Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Statement of Investments. The Statement of Assets and Liabilities reflects a receivable and/or payable for the daily mark to market for variation margin. Realized gains and losses are reported in the Statement of Operations as the closing and expiration of futures contracts. The net change in unrealized appreciation and depreciation is reported on 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 June 30, 2004, the Fund had no outstanding futures contracts. 27 | OPPENHEIMER HIGH INCOME FUND/VA NOTES TO FINANCIAL STATEMENTS Unaudited / Continued - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 7. INTEREST RATE SWAP CONTRACTS The Fund may enter into an interest rate swap transaction to maintain a total return or yield spread on a particular investment, or portion of its portfolio, or for other non-speculative purposes. Interest rate swaps involve the exchange of commitments to pay or receive interest, e.g., an exchange of floating rate payments for fixed rate payments. The coupon payments are based on an agreed upon principal amount and a specified index. Because the principal amount is not exchanged, it represents neither an asset nor a liability to either counterparty, and is referred to as notional. The Fund records an increase or decrease to unrealized gain (loss), in the amount due to or owed by the Fund at termination or settlement. Interest rate swaps are subject to credit risk (if the counterparty fails to meet its obligations) and interest rate risk. The Fund could be obligated to pay more under its swap agreements than it receives under them, as a result of interest rate changes. As of June 30, 2004, the Fund had entered into the following interest rate swap agreements:
FIXED RATE FLOATING RATE PAID BY RECEIVED BY SWAP NOTIONAL THE FUND AT THE FUND AT FLOATING TERMINATION UNREALIZED COUNTERPARTY AMOUNT JUNE 30, 2004 JUNE 30, 2004 RATE INDEX DATES APPRECIATION - ------------------------------------------------------------------------------------------------------------------------ Three-Month Deutsche Bank AG $ 11,000,000 3.19% 1.4275% LIBOR Rate 3/9/09 $ 425,609 Three-Month Deutsche Bank AG 6,000,000 4.23 1.4275 LIBOR Rate 3/9/14 353,834 ---------- $ 779,443 ==========
Index abbreviation is as follows: LIBOR London-Interbank Offered Rate - -------------------------------------------------------------------------------- 8. ILLIQUID SECURITIES As of June 30, 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 intends to invest no more than 15% of its net assets (determined at the time of purchase and reviewed periodically) in illiquid securities. The aggregate value of illiquid securities subject to this limitation as of June 30, 2004 was $18,624,160, which represents 3.43% of the Fund's net assets. - -------------------------------------------------------------------------------- 9. SECURITIES LENDING The Fund lends portfolio securities from time to time in order to earn additional income. In return, the Fund receives collateral in the form of US Treasury obligations or cash, against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the funds and any additional required collateral is delivered to the Fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund could experience delays and cost in recovering the securities loaned or in gaining access to the collateral. Cash collateral is invested in cash equivalents. The Fund retains a portion of the interest earned from the collateral. The Fund also continues to receive interest or dividends paid on the securities loaned. As of June 30, 2004, the Fund had no securities on loan. 28 | OPPENHEIMER HIGH INCOME FUND/VA ITEM 2. CODE OF ETHICS Not applicable to semiannual reports. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT Not applicable to semiannual reports. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES Not applicable to semiannual reports. ITEM 5. NOT APPLICABLE ITEM 6. SCHEDULE OF INVESTMENTS Not applicable ITEM 7. NOT APPLICABLE ITEM 8. NOT APPLICABLE ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Board is responsible for approving nominees for election as trustees. To assist in this task, the Board has designated the Audit Committee as the nominating committee for the Board. It reviews and recommends nominees to the Board. The Committee is comprised entirely of disinterested trustees as defined in Section 2(a)(19) of the Investment Company Act of 1940. The Audit Committee charter describes the responsibilities of the Committee in nominating candidates for election as independent Trustees of the Registrant. The Registrant's Board has adopted a written charter for the Committee. A current copy of the Audit Committee charter is available to shareholders on the OppenheimerFunds website at www.oppenheimerfunds.com. Under the current policy, if the Board determines that a vacancy exists or is likely to exist on the Board, the Audit Committee of the Board will consider candidates for Board membership including recommended by Registrant shareholders. The Audit Committee will consider nominees recommended by independent Board members or recommended by any other Board members including Board members affiliated with the Registrant's investment advisors. The Committee may, upon Board approval, retain an executive search firm to assist in screening potential candidates. Upon Board approval, the Audit Committee may also use the services of legal, financial, or other external counsel that it deems necessary or desirable in the screening process. Shareholders wishing to submit a nominee for election to the Board may do so by mailing their submission to the offices of OppenheimerFunds, Inc., 6803 South Tucson Way, Centennial, CO 80112, to the attention of the Board of Trustees of the named Registrant, c/o the Secretary of the Registrant. The Committee's process for identifying and evaluating nominees for trustees includes a number of factors. In screening candidates for board membership, whether the candidate is suggested by Board members, shareholders or others, the Committee considers the candidate's professional experience, soundness of judgment, integrity, ability to make independent, analytical inquiries, collegiality, willingness and ability to devote the time required to perform Board activities adequately, ability to represent the interests of all shareholders of the Registrant, and diversity relative to the board's composition. Candidates are expected to provide a mix of attributes, experience, perspective and skills necessary to effectively advance the interests of shareholders. ITEM 10. CONTROLS AND PROCEDURES (a) Based on their evaluation of registrant's disclosure controls and procedures (as defined in rule 30a-2(c) under the Investment Company Act of 1940 (17 CFR 270.30a-2(c)) as of June 30, 2004, registrant's principal executive officer and principal financial officer found registrant's disclosure controls and procedures to provide reasonable assurances that information required to be disclosed by registrant in the reports that it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated to registrant's management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure, and (b) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the U.S. Securities and Exchange Commission. (b) There have been no significant changes in registrant's internal controls over financial reporting that occurred during the registrant's last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 11. EXHIBITS. (A) EXHIBIT ATTACHED HERETO. (ATTACH CODE OF ETHICS AS EXHIBIT)(NOT APPLICABLE TO SEMIANNUAL REPORTS) (B) EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS) EX-99.CERT 2 ex99_302cert-640.txt EX99_302CERT-640.TXT Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, John V. Murphy, certify that: -------------- 1. I have reviewed this report on Form N-CSR of Oppenheimer High Income Fund/VA; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of trustees (or persons performing the equivalent functions): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/13/04 /s/John V. Murphy ---------------------------- John V. Murphy Chief Executive Officer Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, Brian W. Wixted, certify that: --------------- 1. I have reviewed this report on Form N-CSR of Oppenheimer High Income Fund/VA; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of trustees (or persons performing the equivalent functions): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/13/04 /s/Brian W. Wixted ---------------------------- Brian W. Wixted Chief Financial Officer EX-99.906 3 ex99_906cert-640.txt EX99_906CERT-640.TXT EX-99.906CERT Section 906 Certifications CERTIFICATION PURSUANT TO 18 U.S.C SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 John V. Murphy, Chief Executive Officer, and Brian W. Wixted, Chief Financial Officer, of Oppenheimer High Income Fund/VA (the "Registrant"), each certify to the best of his or her knowledge that: 1. The Registrant's periodic report on Form N-CSR for the period ended June 30, 2004 (the "Form N-CSR") fully complies with the requirements of Section 15(d) of the Securities Exchange Act of 1934, as amended; and 2. The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. This certification is being furnished to the Commission solely pursuant to 18 U.S.C. ss. 1350 and is not being filed as part of the Form N-CSR filed with the Commission. Chief Executive Officer Chief Financial Officer Oppenheimer High Income Fund/VA Oppenheimer High Income Fund/VA /s/John V. Murphy /s/Brian W. Wixted - ---------------------------- ---------------------------- John V. Murphy Brian W. Wixted Date: 8/13/04 Date: 8/13/04 -----END PRIVACY-ENHANCED MESSAGE-----