-----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, Dz3BjZQzDO1Rb35v2QWPrk6/LbzdM7rGYmScL58EWWoeBnTjeH3u17gw+U1VqnoI J5m/0Wsd6D6bE4iWiSS0Lg== 0000950123-96-004798.txt : 19960830 0000950123-96-004798.hdr.sgml : 19960830 ACCESSION NUMBER: 0000950123-96-004798 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960829 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER VARIABLE ACCOUNT FUNDS CENTRAL INDEX KEY: 0000752737 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 840974272 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04108 FILM NUMBER: 96623417 BUSINESS ADDRESS: STREET 1: 3410 S GALENA ST CITY: DENVER STATE: CO ZIP: 80231 BUSINESS PHONE: 3036713200 MAIL ADDRESS: STREET 2: 3410 S GALENA ST CITY: DENVER STATE: CO ZIP: 80231 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER VARIABLE LIFE FUNDS DATE OF NAME CHANGE: 19860609 N-30D 1 N-30D 1 OPPENHEIMER VARIABLE ACCOUNT FUNDS SEMIANNUAL REPORT JUNE 30, 1996 2 OPPENHEIMER MONEY FUND OBJECTIVE- OPPENHEIMER MONEY FUND primarily seeks maximum current income from investments in "money market" securities consistent with low capital risk and the maintenance of liquidity. This includes short-term U.S. government securities, certificates of deposit, bankers' acceptances and commercial paper. An investment in the Money Fund is neither insured nor guaranteed by the U.S. Government. While the Money Fund seeks to maintain a stable net asset value of $1.00 per share, there can be no assurance that it will be able to do so. NARRATIVE BY ART ZIMMER AND DOROTHY WARMACK, FUND MANAGERS During what was a very difficult year for the fixed income market, Oppenheimer Money Fund performed well. By positioning our investments in securities offering competitive yields and relatively steady prices, we successfully provided investors with a current income while maintaining a constant share price. The portfolio's objective is to preserve capital while capturing the highest yield possible. To meet this objective, that means our assets are invested in low risk, short term securities such as commercial paper, letters of credit and floating rate securities--all generally conservative securities. However, within these areas, there are actions we took to maximize the portfolio's performance as the market changed. For example, as interest rates began to rise early this year, we began to invest in securities that had even shorter maturities than we owned last year. Shorter maturity securities must be replaced by new issues more frequently, and as rates have risen, we have been able to replace our maturing holdings with new securities that offered higher yields. This positioning is one factor that helped us maintain a competitive yield during the period. As we move through the remainder of the year, we will continue to focus on maximizing the portfolio's yield while watching interest rates carefully. At this time, we believe reports of stronger than expected economic growth are making further interest rate cuts unlikely this year. We feel it is likely that the Federal Reserve will tighten monetary policy slightly this summer. We're currently maintaining our focus on shorter securities and watching carefully for ways to increase yield. This should be accomplished through purchase of floating rate securities, new commercial paper programs and structuring the maturities of our investments.(1) Because the securities in which we must invest have short maturities, the yields paid are directly related to prevailing interest rates. As a result, Oppenheimer Money Fund is one of the few types of investments that benefits from higher interest rates. The fact that rates are higher now than they were at the beginning of the year should continue to work in our favor over the near term. Still, unless we begin to see clear evidence of a slowdown in the economy, relative to last year, we will remain fairly short in our average maturity. Given this outlook for the market, we expect to continue to provide investors with a competitive income stream as well as safety of principal as the year progresses. We appreciate your confidence in Oppenheimer Money Fund. We look forward to helping you with your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 3 OPPENHEIMER HIGH INCOME FUND OBJECTIVE- OPPENHEIMER HIGH INCOME FUND seeks a high level of current income with a secondary objective of capital growth. The Fund invests in high yielding, lower rated and unrated corporate bonds. NARRATIVE BY DAVID NEGRI, FUND MANAGER The portfolio did very well over the past six months, continuing what was an extremely strong previous twelve months. Despite a rise in interest rates that hurt most bond investments, high yield bonds have continued to perform well. The portfolio's aggressive positioning at the beginning of this period allowed us to take advantage of the strength of high yield bonds in the midst of a generally weak bond market. Beyond being aggressive in terms of credit quality, our good performance was primarily the result of several well-timed sector allocations. In particular, our decision to overweight holdings in the gaming industry and underweight holdings in paper and forest products companies proved positive for the Fund.(1) Gaming companies performed well because of the ongoing consolidations and mergers within the industry. This year many gaming companies began growing their businesses by making acquisitions. In addition, the management of quite a few of these companies were able to consolidate their operations and improve their bottom lines. With most of this activity viewed as positive, the bonds of many of these companies did well. We also benefited from avoiding the bonds of companies who manufacture paper and forest products. With demand for these products relatively light and supply ample, their bonds performed poorly during the year. In addition to good industry allocations, we invested about 12 percent of our assets in foreign government bonds, in both developed and emerging nations. By doing so, we were able to diversify the portfolio, as well as significantly increase returns over the period. Though the majority of our investments performed very well, we experienced some disparity related to our overweight in media and telecommunications bonds. An increase of high-yield issues in this sector caused the supply and demand relationship to be temporarily thrown off-balance. However, we expect this area to even itself out in the near future due to deregulation and increasing demand that should continue to drive future growth, especially for companies who borrowed money over the past six months to finance their expansion efforts. Thus, we have maintained our holdings in this sector, and expect the supply and demand imbalance to level out shortly. Looking toward the remainder of the year, in addition to maintaining our focus on growth businesses, we continue to emphasize investment opportunities that offer good value. Because lower-rated high-yielding bonds have performed so well, their valuations have crept upward since 4 the beginning of the year and are now at a level where we feel they offer less opportunity for price appreciation. Consequently, we're moving to relatively higher credit quality bonds within the high yield market, where valuations have not yet peaked, and repositioning the Fund to become slightly more conservative. This may reduce the risks of investing in lower rated, high yield bonds, described in the Fund's prospectus. Going forward, our outlook is very favorable. High yield bonds have been one of the best performing sectors of the bond market over the period, and we expect that to continue in the coming months. There are two reasons for this. First, in a bond market where coupon income is likely to drive returns, non-investment grade corporate bonds offer the advantage of higher income. Second, because we expect the economy will be stronger than it was at the end of 1995, corporate earnings should remain strong, so that credit strength should continue to offset any negative effects that interest rate changes may have on high yield bonds. We appreciate your confidence in Oppenheimer High Income Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 5 OPPENHEIMER BOND FUND OBJECTIVE OPPENHEIMER BOND FUND primarily seeks a high level of current income from investing in high yield fixed-income securities rated "Baa" or better by Moody's of "BBB" or better by Standard & Poor's. Secondarily, the Fund seeks capital growth when consistent with its primary objective of high current income. NARRATIVE BY DAVID NEGRI, FUND MANAGER There were two major factors that contributed to the performance of Oppenheimer Bond Fund. First, was our defensive decision to keep the portfolio's average maturity relatively short, and second, was our strategic diversification over a variety of different types of bonds. A short average maturity was a benefit as interest rates rose. Since longer bonds are typically the most sensitive to changes in interest rates, they depreciated the most this year. So, by having a shorter portfolio, we were able to capture a competitive level of income, but suffered less in terms of price than some longer-term investments. Our diversification among different classes of bonds also benefited the portfolio. In particular, our international bonds performed well, avoiding the difficulties experienced by most types of domestic bonds. Our mortgage-backed securities also performed well. As interest rates rose, prepayment risk decreased supporting mortgage bond prices. Mortgage-backed securities also pay very competitive income, which benefited the portfolio.(1) While the Fund's short average maturity and high degree of current income helped to offset the negative price performance of the general bond market, our Treasury securities performed poorly in comparison with our other holdings. Still, at only half of our U.S. government bond allocation, and with shorter-term maturities, we were able to limit their potentially negative impact. As we move through the second half of the year, we will continue to work on capturing as much income as possible. Because we believe the economy is relatively healthy, we will continue to focus on corporate bonds. In particular, we believe there is great potential to be found in bonds issued by financial services firms and oil- and gas-related businesses. Within the financial services industry, companies with ongoing consolidations should improve balance sheets and profitability, while in the oil and gas industry, technology stocks are experiencing improving profits. We also believe that foreign government bonds offer greater income and relative value than domestic government bonds, so we'll continue to emphasize the bonds of developed nations where we see compelling yield and total return opportunities. Finally, we continue to favor mortgage-related securities over Treasuries, and have been adding to our holdings in private label mortgages. Because these are loans underwritten by banks rather than the federal government, in general they tend to offer higher yields than similar securities. Looking forward, we think the Fund will continue to do well because of its strategic positioning. Currently, we expect that economic growth in the U.S. will continue, though it may not necessarily accelerate. In this type of environment, it's difficult to imagine the Federal Reserve 6 will cut interest rates, so it's hard to imagine another bull market like the one we experienced last year. In light of our outlook on the economy, we will continue to position the portfolio around income opportunities and avoid taking on unnecessary interest rate risk. By investing in quality bonds, with an attractive inflation-adjusted real rate of return, we expect to provide investors with relative price stability and competitive income going forward. We appreciate your confidence in Oppenheimer Bond Fund. We look forward to helping your reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 7 OPPENHEIMER CAPITAL APPRECIATION FUND OBJECTIVE OPPENHEIMER CAPITAL APPRECIATION FUND primarily seeks aggressive capital appreciation through investments in the common stocks of "growth type" companies. In addition, the Fund may selectively invest in some "special situations" which management believes may provide opportunities for growth NARRATIVE BY PAUL LAROCCO, FUND MANAGER The Capital Appreciation Fund has been an excellent investment over the past six months. The results can be attributed to the strong performance of smaller company growth stocks as well as the fact that we made some well-timed investment decisions. We are pleased to report that the portfolio's total return for the six months ended June 30, 1996 is 18.92%.(1) Small company stocks performed well over the period for two main reasons. First, their profitability and growth potential are less dependent on the U.S. dollar rising than are some larger companies, when the dollar rose early this year, smaller company stocks were not as negatively impacted. Second, because the current economic growth phase has been unexpectedly long--creating concern among investors about companies' continuing profitability--investor demand shifted to some of the same high growth areas of the market in which we tend to focus on. When we buy growth stocks for the portfolio, we look for companies with extremely attractive earnings growth rates, new products, or strong gains in market share. We think these are some of the attributes that companies will need to continue to grow quickly over time. In healthcare, we owned stocks in selected physician practice management stocks, a growing part of the healthcare industry. Physician practice management companies help doctors manage their practices thereby enabling the doctors to spend more time with patients and less time doing administrative work. As for technology, we focused on telecommunications and software firms, where companies have profited from high demand both in the U.S. and abroad. In the business services area, our successes were in the credit card transaction processing area, and we've also done well with selected apparel and footwear manufacturers.(2) We're generally very pleased with our performance over the period. We didn't have many disappointments in the companies we owned, and we didn't miss many opportunities. Looking back, the only area we weren't invested in but would have liked to have been was in energy stocks. Energy companies performed unexpectedly well as a result of high demand and price increases. While the portfolio has performed exceptionally well, we are currently slightly cautious in our approach to the market. We want to make sure that the companies we own will be able to deliver consistent earnings in an environment of slower growth than last year. As a hedge against slower future growth, we're carefully watching for changes in stocks' price/earnings ratios, trying to avoid paying too much for a company's growth potential. But beyond this vigilant posture, we're 8 optimistic. Going forward, we expect to see moderate economic growth here in the U.S. That's a situation that could benefit the portfolio, by keeping investors focused on the types of stocks we normally own--companies with well-defined business niches, great competitive strengths and the potential to grow quickly even if the overall economic growth rate is only modest. In addition, we believe smaller company stocks are still in an extended period of outperformance. Taken together, these factors support our belief that the portfolio will continue to help investors take advantage of the market's tremendous growth potential over time. We appreciate your confidence in Oppenheimer Capital Appreciation Fund. We look forward to helping your reach your financial goals in the future. - -------- (1) Based on the change in net asset value per share for the periods shown. Does not reflect separate account expenses. Such performance would have been lower if expenses were taken into account. (2) The Fund's portfolio is subject to change. 9 OPPENHEIMER GROWTH FUND OBJECTIVE- OPPENHEIMER GROWTH FUND primarily seeks capital appreciation from investments in securities of well-known and established companies. Current income is a secondary consideration. The Fund's present focus is principally in securities of companies having a medium of large capitalization, and a history of earnings and dividend growth. NARRATIVE BY JANE PUTNAM, FUND MANAGER Oppenheimer Growth Fund has been an excellent investment over the past six months. Our performance was helped by the fact that the U.S. economy was still expanding, and as a result, traditional growth sectors of the market outperformed more value-oriented investments. However, we also did well compared to our growth-oriented peers, finishing in the top third of all rated funds with our investment objective.(1) Beyond being growth investors at a time when growth was very much in demand, one of the decisions that benefited us over the past six months was our stock selection. Over the period, we were heavily weighted in cyclical stocks compared to our peers. Because these companies do best when the economy is strong, investor demand drove cyclical stock prices up when first quarter reports showed stronger-than-expected economic growth. Thus, our concentration in cyclicals--primarily chemical and paper companies--was a benefit. We also owned a large number of technology stocks that did well because of their high growth potential. On the other hand, we were overweighted versus our peers in financial services companies. Over the long term, this is an area we believe offers great prospects. However, because of the rise in interest rates in the first half of this year, financial stocks underperformed. The fact that they lagged year-to-date made their stock prices more attractive on a relative basis, giving us even greater confidence in their merits as a long-term investment. As a result, we recently added stocks of some asset managers and brokerage firms. After last year's run-up in stock prices, we had some difficulty finding stocks selling at what we'd consider low-to-reasonable price levels. As a consequence, our cash position was slightly higher than normal. While having a high level of cash can protect a portfolio when the stock market is declining, it's a drag when the market's going up. So, although we've outperformed some of our peers, our cash position held us back somewhat. As we move through the remainder of the year, we continue to hold higher-than-average weightings in both technology and financial services companies. Although prices have risen dramatically for both sectors, the earnings of many technology and financial services firms are rising faster. For this reason, we believe their stocks are still excellent growth investments. In contrast, we've recently been selling some of our cyclical stocks. Because they've performed so well over the past six months, we believe these companies have appreciated enough to become more than fully-valued. Specifically, we took profits in some chemical and basic materials stocks as well as in some of our retail holdings. 10 All in all, our outlook for the fund is very favorable, though we have become somewhat contrarian in our approach to the market. We are holding enough cash to be able to take quick advantage of any opportunities created when various companies or market sectors fall out of favor. However, we remain aggressive in our high growth potential stock and sector holdings. We appreciate your confidence in Oppenheimer Growth Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) Source: Lipper Analytical Services 6/30/96. Oppenheimer Growth Fund is catagorized by Lipper as a growth fund. 11 OPPENHEIMER MULTIPLE STRATEGIES OBJECTIVE- OPPENHEIMER MULTIPLE STRATEGIES seeks a total investment return (including current income and capital appreciation in the value of its shares) from investments in common stocks and other equity securities, bonds and other debt securities, and "money market" securities. The current allocation of the Fund's portfolio aims to take advantage of current economic conditions while managing risk. NARRATIVE BY RICHARD RUBINSTEIN, FUND MANAGER The Multiple Strategies portfolio delivered solid results for the past six months. Its performance can be attributed to both the benefits of an investment strategy designed to work well under a variety of conditions and the continued strength of the domestic stock market and our diversified approach to bonds. Our domestic stock holdings, which included large positions in technology and healthcare stocks, performed well for us even as earnings momentum in general began to slow. These companies are positioned to grow rapidly regardless of the overall U.S. economic growth rate, and as a result, they were very much in demand with investors. In addition, our bond allocation decisions helped performance as we moved away from government bonds to seek the more competitive returns of high yield, lower rated bonds.(1) And, while the Fund's international equity holdings contributed less to the portfolio's total return than did its U.S. stock component, our broad international diversification helped us maintain a low risk profile. And although our foreign stock holdings failed to meet our expectations this period, our philosophy for including these securities in the portfolio is that they may help limit overall portfolio risk. However, over the long-term they offer the potential to add to performance. As we position the portfolio for the remainder of the year, we have looked at current economic factors and reallocated the portfolio's assets to a more conservative mix. The combination of slowing U.S. corporate earnings momentum, high valuations and an increase in interest rates of over 100 basis points, led us to make some strategic changes. These changes resulted in a decrease in our total equity holdings by about five percent as well as a decrease in our total number of securities. At the same time, we increased, on a percentage basis, those holdings we believe are best positioned for the future. Our expectation is that the stock market will continue to become very selective, and these changes may be to our advantage. More specifically, we continued to focus on growth stocks that are issued by companies with strong competitive positions and consistent earnings. We also recently added to our position in energy stocks. These stocks tend to sell at low prices relative to cash flows. With energy prices on the rise, we believe they offer reward potential. A strong part of our overall strategy involved a contrarian approach to investing. Using this approach we looked for opportunities in out-of-favor industries and companies on the rebound. Recently, we bought retail stocks. Though sales have suffered from consumer uneasiness, these 12 companies still have attractive store economics. As a result, we think their prospects look good. On the international side, we increased positions in companies having comparative advantages over the U.S. competitors or that sell at valuation discounts. We located companies offering such advantages in Argentina, Turkey and the Far East, as well as in several more established European markets, and invested in those firms. Going forward, our long-term outlook is positive, in spite of the increased volatility experienced by the stock market during the first half of 1996 and the risks of foreign investing and of high yield bonds, described in the Fund's prospectus. We feel the portfolio's diversification may help it ride the current market waves and continue to offer excellent opportunities for the long-term investor. We appreciate your confidence in Oppenheimer Multiple Strategies Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 13 OPPENHEIMER GLOBAL SECURITIES FUND OBJECTIVE- OPPENHEIMER GLOBAL SECURITIES FUND seeks capital growth by investing in a diversified portfolio of foreign and domestic stocks. NARRATIVE BY WILLIAM WILBY, FUND MANAGER Oppenheimer Global Securities Fund has performed well over the past six months. Using our theme-driven investment approach, we turned in results that were better than most of our competitors. Even so, it was difficult for global funds to compete with the outstanding returns from the U.S. market over the period. As the domestic market has continued to evolve, however, we are beginning to see evidence of a shift toward international stocks. The long-term potential for growth may be greater in international stocks than it is in the U.S. market, especially at current valuation levels. Because of the strength in the domestic market and where we were positioned within it, our U.S. holdings performed extremely well over the period. One of our largest concentrations within domestic stocks was in the technology sector. And just as technology led the U.S. market, our efficiency-enhancing technology theme led the portfolio. Our Japanese technology companies performed particularly well, as Japan began to climb out of a five year recession. In fact, our Japanese technology stocks have appreciated to the point that we think they're slightly expensive now. As a result, we've been selling Japanese and buying U.S. technology again.(1) On the negative side, toward the end of 1995 and into 1996, we thought European cyclicals companies--the economically sensitive chemical, automotive, and industrial companies--had become overly discounted as a result of slow European economic growth. We felt that their reduced prices would allow us to buy them while they were good values and then participate in their gains as local economies improved. However, western European growth has remained somewhat subdued, so these companies have not yet returned to favor. After the huge rally in U.S. stocks, we've cut back on our domestic holdings slightly. While we believe the outlook for the U.S. market remains favorable, we believe there may be better opportunities overseas at this time. As such, we've reduced our domestic allocation to 43%, down from a high of 49%. Recently, we've also been buying some gold stocks, both as part of our natural resources theme and to help diversify the portfolio. Gold stocks look like a good investment right now for several reasons. First, gold production worldwide is below what is needed to meet current demand, particularly due to the increased demand for jewelry from the emerging markets. And because gold may be a good hedge against--both inflation and deflation--demand from investors could increase. We expect the remainder of the year will be good for us. Since our market lagged somewhat during 1995, we've been able to buy what we believe are excellent stocks at good prices, and that should give us an extra push when the U.S. market returns to favor. We think the Fund's 14 portfolio, invested as it is in high growth potential stocks, continues to offer investors an outstanding opportunity both for diversification and long-term appreciation potential. We appreciate your confidence in Oppenheimer Global Securities Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 15 OPPENHEIMER STRATEGIC BOND FUND OBJECTIVE-- OPPENHEIMER STRATEGIC BOND FUND seeks a high level of current income by investing in three sectors: foreign fixed-income securities, lower-rated high yield corporate bonds, and U.S. government issues. NARRATIVE BY DAVID NEGRI, FUND MANAGER The Strategic Bond portfolio performed well over the past six months despite a rise in domestic interest rates. Our investment strategy involves investing in sectors of the bond market that offer high income and total return potential separately, while also responding to broad market factors independently. By diversifying our investments across high yield, lower rated corporate bonds, U.S. government bonds, and foreign bonds, we were able to maintain strong performance even as many other bond investments suffered. While rising interest rates hurt domestic government bonds over the past six months, both foreign bonds and high yield bonds performed very well, providing the majority of our returns. While high yield bonds generally entail greater risks than investment grade bonds, they also tend to be less sensitive to interest rates, which helped them perform well. In addition, because payment of interest and principal depends on an issuing company's profitability, high yield bonds tend to follow upward moves in the stock market, like those we've seen so far this year. We owned high yield bonds of companies in two categories--those we expected to be able to grow faster than the economy as a whole, and those we felt were temporarily undervalued. In particular, our holdings in the gaming industry benefited us over the period.(1) Like high yield bonds, foreign bonds also offered higher yield and return potential over the past six months than did domestic government securities. So, by owning foreign bonds, the Fund was more than compensated for the currency risk and added expense they entail. In the U.S. government sector of the portfolio, a shift from Treasuries toward the better-performing mortgage-backed securities area was another benefit. When interest rates increase, mortgage-backed securities perform better than other fixed-income securities because the risk of early prepayment declines. In general, mortgage-backed securities also tend to offer higher yields than comparable Treasuries. Looking toward the remainder of the year, we expect to continue our current approach to the market, taking advantage where we can of opportunities in foreign bonds and high yield bonds while we wait for the domestic market to improve. We will continue to focus on emerging markets' debt over developed nations' debt, and to look for high yield bonds of companies we think are well-positioned for the coming business environment. Mortgage-backed securities will remain an important part of our U.S. government allocation, and where we are invested in Treasuries, we plan to stay put in shorter-term bonds, since they carry less interest rate risk. Because of its strategic positioning, we think this portfolio will continue to do well as the year plays out. Currently, we expect that economic growth in the U.S. will continue, though it may not necessarily accelerate. With this view, we will continue to position the portfolio around what 16 we consider the best income and return opportunities worldwide, while we avoid taking on unnecessary interest rate risk. We are confident this portfolio should perform well in a variety of market climates. We appreciate your confidence in Oppenheimer Strategic Bond Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 17 OPPENHEIMER GROWTH & INCOME FUND OBJECTIVE- OPPENHEIMER GROWTH & INCOME FUND seeks high total return, which includes growth in the value of its shares as well as current income from equity and debt securities. NARRATIVE BY ROBERT MILNAMOW, FUND MANAGER Oppenheimer Growth & Income Fund performed well over the last six months. We have positioned our holdings in the stocks of companies representing five strategic areas of the market. These five areas are comprised of companies in emerging industries and improving industries; large growth companies that define their industries; smaller companies with niche businesses; companies undergoing restructuring; and finally companies that are fundamentally strong selling at extremely low valuations.(1) In emerging industries, we were pleased with our investments in telecommunications equipment manufacturers, small long distance telephone companies and internet-related companies. In the first half of 1996, small stocks outperformed their larger counterparts due to the demand for their superior growth rates. As a result, our smaller growth companies did well as a group. After their excellent performance in 1995, large cap stock prices started the year at fairly high valuations, so we didn't expect tremendous advancement. Even so, we did well with several large cap energy stocks. We also did well with selected chemical stocks and financial services companies that had undergone restructuring. Finally, three undervalued areas that performed particularly well for us were domestic retail and gaming companies as well as selected Japanese stocks. Although our performance was very good overall, we had some disappointments in the healthcare industry during the period. After having done well in 1995, healthcare stocks were subject to profit taking in the first half of 1996. In addition, early in 1996, investors' interest moved away from steady growth industries like healthcare to more economically-sensitive industries like aerospace, based on reports of fast economic growth. However, we remain committed to the belief the healthcare is dynamic and holds the potential for growth over time. Our asset mix has remained relatively constant for the year, and should not change dramatically over the near term. Currently, 87 percent of our holdings are in stocks, roughly 4 percent in convertibles securities, and the remainder in cash. Looking ahead, we plan to remain focused on carefully selecting companies that fall into our five targeted market segments. As always, we will continue to look for value and growth potential across all our investments. We believe we have enough flexibility to do well in almost any market environment. As we move toward the remainder of the year, we've positioned the portfolio to benefit from worldwide economic expansion while aiming for a combination of long-term growth and current income. As the domestic market becomes more volatile, we also expect our income focus to provide some shelter from risk and price volatility. We appreciate your confidence in Oppenheimer Growth & Income Fund. We look forward to helping you reach your financial goals in the future. - -------- (1) The Fund's portfolio is subject to change. 18 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MONEY FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL VALUE AMOUNT (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------- CERTIFICATES OF DEPOSIT - 2.6% - ------------------------------------------------------------------------------------------------------------------------------- EURODOLLAR CERTIFICATES OF DEPOSIT - 2.6% - ------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------- Deutsche Bank, 5.10%, 8/23/96 (Cost $3,000,043) $3,000,000 $3,000,043 - ------------------------------------------------------------------------------------------------------------------------------- DIRECT BANK OBLIGATIONS - 12.0% - ------------------------------------------------------------------------------------------------------------------------------- Credit Suisse, guaranteeing commercial paper of Guandong Enterprises (Holdings) Ltd., 5.46%, 7/24/96 5,253,000 5,234,676 ----------------------------------------------------------------------------------------------------------------------- Huntington National Bank, 5.09%, 8/21/96 3,000,000 3,000,000 ----------------------------------------------------------------------------------------------------------------------- National Westminster Bank of Canada, 5.40%, 7/26/96 3,000,000 2,988,750 ----------------------------------------------------------------------------------------------------------------------- Societe Generale, guaranteeing commercial paper of Banco Nacional de Comercio Exterior, SNC-2, Series A 5.20%, 7/10/96 2,500,000 2,496,750 ----------------- Total Direct Bank Obligations (Cost $13,720,176) 13,720,176 - ------------------------------------------------------------------------------------------------------------------------------- SHORT-TERM NOTES - 85.2% - ------------------------------------------------------------------------------------------------------------------------------- BANKS - 4.4% ----------------------------------------------------------------------------------------------------------------------- Barnett Banks, Inc., 5.36%, 7/1/96 5,000,000 5,000,000 - ------------------------------------------------------------------------------------------------------------------------------- BROKER/DEALERS - 9.0% ----------------------------------------------------------------------------------------------------------------------- Dean Witter, Discover & Co., 5.77%, 1/15/97 (1) 2,000,000 2,002,556 ----------------------------------------------------------------------------------------------------------------------- Merrill Lynch & Co., Inc.: 5.29%, 7/15/96 1,478,400 1,475,359 5.36%, 7/8/96 4,000,000 3,995,839 ----------------------------------------------------------------------------------------------------------------------- Morgan Stanley Group, Inc., 5.27%, 9/30/96 (1) 2,800,000 2,800,000 ----------------- 10,273,754 - ------------------------------------------------------------------------------------------------------------------------------- CHEMICALS - 0.8% ----------------------------------------------------------------------------------------------------------------------- Monsanto Co., 5.27%, 7/23/96 924,000 921,024 - ------------------------------------------------------------------------------------------------------------------------------- COMMERCIAL FINANCE - 10.7% ----------------------------------------------------------------------------------------------------------------------- CIT Group Holdings, Inc., 5.60%, 7/11/96 (1)(2)(3) 1,000,000 1,000,000 ----------------------------------------------------------------------------------------------------------------------- Countrywide Home Loan, 5.35%, 7/3/96 1,500,000 1,499,554 ----------------------------------------------------------------------------------------------------------------------- FINOVA Capital Corp.: 5.45%, 9/3/96 3,500,000 3,466,400 5.50%, 7/2/96 720,000 719,890 ----------------------------------------------------------------------------------------------------------------------- Heller Financial, Inc.: 5.48%, 8/15/96 (1) 2,600,000 2,582,190 5.70%, 12/1/96 (1) 3,000,000 3,001,696 ----------------- 12,269,730 - ------------------------------------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE - 3.0% ----------------------------------------------------------------------------------------------------------------------- First Data Corp., 5.38%, 7/2/96 3,400,000 3,399,492 - ------------------------------------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 9.9% ----------------------------------------------------------------------------------------------------------------------- General Electric Capital Corp., 4.94%, 8/21/96 3,000,000 2,979,005 ----------------------------------------------------------------------------------------------------------------------- General Motors Acceptance Corp.: 5.42%, 11/8/96 3,500,000 3,431,497 5.42%, 8/19/96 2,000,000 1,985,246 ----------------------------------------------------------------------------------------------------------------------- Prudential Funding Corp., 5.06%, 7/8/96 3,000,000 2,997,048 ---------------------- 11,392,796
1 19 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MONEY FUND Statement of Investments (Continued)
PRINCIPAL VALUE AMOUNT (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- ELECTRONICS - 6.9% ------------------------------------------------------------------------------------------------------------------------- ITT Industries, Inc., 5.40%, 7/8/96 (2) $3,000,000 $2,996,850 ------------------------------------------------------------------------------------------------------------------------- Mitsubishi Electric Finance America, Inc.: 5.12%, 7/24/96 (2) 3,000,000 2,990,187 5.41%, 8/7/96 (2) 2,000,000 1,988,879 ------------------- 7,975,916 - --------------------------------------------------------------------------------------------------------------------------------- ENVIRONMENTAL - 2.6% ------------------------------------------------------------------------------------------------------------------------- WMX Technologies, Inc., 5.32%, 9/10/96 (2) 3,000,000 2,968,523 - --------------------------------------------------------------------------------------------------------------------------------- HEALTHCARE/SUPPLIES & SERVICES - 0.8% ------------------------------------------------------------------------------------------------------------------------- Allergan, Inc., 5.33%, 7/16/96 916,600 914,564 - --------------------------------------------------------------------------------------------------------------------------------- LEASING & FACTORING - 7.7% ------------------------------------------------------------------------------------------------------------------------- CSW Credit, Inc., 5.42%, 8/7/96 5,600,000 5,568,805 ------------------------------------------------------------------------------------------------------------------------- The Hertz Corp., 5.37%, 7/10/96 3,250,000 3,245,637 ------------------- 8,814,442 - --------------------------------------------------------------------------------------------------------------------------------- SPECIAL PURPOSE FINANCIAL - 22.8% ------------------------------------------------------------------------------------------------------------------------- Asset Securitization Cooperative Corp., 5.31%, 7/8/96 (2) 739,200 738,424 ------------------------------------------------------------------------------------------------------------------------- CIESCO L.P., 5.42%, 5/19/97 (1)(2) 3,000,000 2,999,545 ------------------------------------------------------------------------------------------------------------------------- Cooperative Association of Tractor Dealers, Inc.: 5.08%, 7/2/96 1,478,400 1,478,182 5.45%, 7/3/96 1,550,000 1,549,531 ------------------------------------------------------------------------------------------------------------------------- Corporate Asset Funding Co., Inc., 5.60% 7/1/96 4,761,000 4,761,000 ------------------------------------------------------------------------------------------------------------------------- Falcon Asset Securitization Corp., 5.41%, 7/25/96 (2) 5,645,000 5,624,640 ------------------------------------------------------------------------------------------------------------------------- First Deposit Master Trust 1993-3, 5.42%, 8/12/96 (2) 4,600,000 4,570,913 ------------------------------------------------------------------------------------------------------------------------- Sheffield Receivables Corp., 5.35%, 7/8/96 4,400,000 4,395,406 ------------------- 26,117,641 - --------------------------------------------------------------------------------------------------------------------------------- SPECIALTY RETAILING - 1.9% ------------------------------------------------------------------------------------------------------------------------- St. Michael Finance Ltd., guaranteed by Marks & Spencer PLC, 5.35%, 9/4/96 2,200,000 2,178,749 - --------------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 4.7% ------------------------------------------------------------------------------------------------------------------------- NYNEX Corp.: 5.33%, 7/12/96 3,400,000 3,394,463 5.35%, 7/29/96 2,000,000 1,991,538 ------------------- 5,386,001 ------------------- Total Short-Term Notes (Cost $97,612,632) 97,612,632 - --------------------------------------------------------------------------------------------------------------------------------- U.S. GOVERNMENT OBLIGATIONS - 0.6% - --------------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Nts., 6.13%, 7/31/96 (Cost $740,118) 740,000 740,118 ------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE 100.4% 115,072,969 ------------------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (0.4) (486,711) ---------------------- ------------------- NET ASSETS 100.0% $114,586,258 ====================== ===================
Short-term notes and direct bank obligations are generally traded on a discount basis; the interest rate is the discount rate received by the Fund at the time of purchase. Other securities normally bear interest at the rates shown. 2 20 Oppenheimer Variable Account Funds - Oppenheimer Money Fund Statement of Investments (Continued) - -------------------------------------------------------------------------------- 1. Floating or variable rate obligation maturing in more than one year. The interest rate, which is based on specific, or an index of, market interest rates, is subject to change periodically and is the effective rate on June 30, 1996. This instrument may also have a demand feature which allows the recovery of principal at any time, or at specified intervals not exceeding one year, on up to 30 days' notice. Maturity date shown represents effective maturity based on variable rate and, if applicable, demand feature. 2. Restricted securities amount to $25,877,961, or 22.58% of the Fund's net assets, at June 30, 1996. In addition to being restricted, the security may be considered illiquid by virtue of the absence of a readily available market or because of legal or contractual restrictions on resale. Illiquid securities amount to $1,000,000, or 0.87% of the Fund's net assets, at June 30, 1996. The Fund may not invest more than 10% of its net assets determined at the time of purchase) in illiquid securities. 3. Put obligation redeemable at full face value on the date reported. See accompanying Notes to Financial Statements. 3 21 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- MORTGAGE-BACKED OBLIGATIONS - 2.8% - --------------------------------------------------------------------------------------------------------------------------------- CBA Mortgage Corp., Mtg. Pass-Through Certificates, Series 1993-C1, Cl. F, 7.153%, 12/25/03 (2)(3) $ 700,000 $ 523,687 -------------------------------------------------------------------------------------------------------------------------- Merrill Lynch Mortgage Investors, Inc., Mtg. Pass-Through Certificates, Series 1995-C2, Cl. D, 8.266%, 6/15/21 (2) 482,223 482,751 -------------------------------------------------------------------------------------------------------------------------- Morgan Stanley Capital I, Inc., Commercial Mtg. Pass- Through Certificates, Series 1996-C1, Cl. E, 7.51%, 2/1/28 (2)(4) 835,342 653,133 -------------------------------------------------------------------------------------------------------------------------- Mortgage Capital Funding, Inc., Multifamily Mortgage Pass- Through Certificates, Series 1996-MC1, Cl. G, 7.15%, 6/15/06 (4)(5) 750,000 560,625 -------------------------------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates: Series 1994-C1, Cl. E, 8%, 6/25/26 722,038 638,553 Series 1994-C2, Cl. G, 8%, 4/25/25 863,240 728,898 Series 1995-C1, Cl. F, 6.90%, 2/25/27 1,028,041 841,388 -------------- Total Mortgage-Backed Obligations (Cost $4,356,982) 4,429,035 - --------------------------------------------------------------------------------------------------------------------------------- FOREIGN GOVERNMENT OBLIGATIONS - 9.5% - --------------------------------------------------------------------------------------------------------------------------------- Argentina (Republic of): Bonds, 11.25%, 4/10/06 DEM 175,000 116,004 Unsub. Unsec. Bonds, 10.25%, 2/6/03 DEM 810,000 537,467 -------------------------------------------------------------------------------------------------------------------------- Banco Estado Minas Gerais, 8.25%, 2/10/00 550,000 503,250 -------------------------------------------------------------------------------------------------------------------------- Banco Hipotecario Nacional (Argentina) Medium-Term Nts., 10.625%, 3/29/99 (4) 150,000 151,875 -------------------------------------------------------------------------------------------------------------------------- Banco Nacional de Comercio Exterior SNC International Finance BV Gtd.: Bonds, 8.75%, 9/28/00 GBP 110,000 156,070 Nts., 8%, 8/5/03 450,000 384,469 -------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Nts., Banco Estado Minas Gerais, 7.875%, 2/10/99 30,000 27,787 -------------------------------------------------------------------------------------------------------------------------- Buenos Aires (Province of) Bonds, 10%, 3/5/01 DEM 214,000 143,403 -------------------------------------------------------------------------------------------------------------------------- Bulgaria (Republic of): Front-Loaded Interest Reduction Bearer Bonds, Tranche A, 2%, 7/28/12 (2) 820,000 273,419 Interest Arrears Bonds, 6.25%, 7/28/11 (2) 970,000 460,750 -------------------------------------------------------------------------------------------------------------------------- Canada (Government of) Real Return Debs., 4.517%, 12/1/21 (6) CAD 1,600,000 1,153,117 -------------------------------------------------------------------------------------------------------------------------- Central Bank of Costa Rica Interest Claim Bonds, Series B, 6.328%, 5/21/05 (2) 262,123 242,464 -------------------------------------------------------------------------------------------------------------------------- Denmark (Kingdom of) Bonds, 8%, 5/15/03 DKK 4,545,000 820,228 -------------------------------------------------------------------------------------------------------------------------- Ecuador (Republic of) Disc. Bonds, 6.063%, 2/28/25 (2) 430,000 244,025 -------------------------------------------------------------------------------------------------------------------------- Hashemite Kingdom of Jordan: Disc. Bonds, 6.625%, 12/23/23 (2) 1,000,000 702,500 Interest Arrears Bonds, 6.625%, 12/23/05 (2) 100,000 80,750 -------------------------------------------------------------------------------------------------------------------------- Italy (Republic of) Certificati di Credito del Tesoro Nts., 11.20%, 8/1/00 (2) ITL 480,000,000 320,636
4 22 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- FOREIGN GOVERNMENT OBLIGATIONS - 9.5% - --------------------------------------------------------------------------------------------------------------------------------- National Treasury Management Agency (Irish Government) Bonds, 8%, 10/18/00 IEP 370,000 $ 617,111 --------------------------------------------------------------------------------------------------------------------- New South Wales Treasury Corp. Gtd. Bonds, 12%, 12/1/01 AUD 1,150,000 1,028,252 --------------------------------------------------------------------------------------------------------------------- New Zealand (Republic of) Bonds, 8%, 2/15/01 NZD 660,000 434,679 --------------------------------------------------------------------------------------------------------------------- Panama (Republic of) Debs., 6.629%, 5/10/02 (2) 161,539 151,847 --------------------------------------------------------------------------------------------------------------------- Poland (Republic of) Treasury Bills, Zero Coupon: 21.464%, 10/16/96 (7) PLZ 500,000 173,205 20.376%, 3/19/97 (7) PLZ 800,000 255,785 22.405%, 7/24/96 (7) PLZ 1,000,000 362,939 --------------------------------------------------------------------------------------------------------------------- Portugal (Republic of) Gtd. Bonds, Obrigicion do tes Medio Prazo, 11.875%, 2/23/00 PTE 85,000,000 607,007 --------------------------------------------------------------------------------------------------------------------- Sweden (Kingdom of) Bonds, Series 1030, 13%, 6/15/01 SEK 3,200,000 589,679 Telecomunicacoes Brasileiras SA, 13% Bonds, 2/5/99 ITL 385,000,000 258,684 --------------------------------------------------------------------------------------------------------------------- United Kingdom Treasury Nts., 13%, 7/14/00 (14) GBP 815,000 1,520,409 --------------------------------------------------------------------------------------------------------------------- United Mexican States: Bonds, 10.375%, 1/29/03 DEM 850,000 570,431 Nacional Financiera SNC Nts., 13.60%, 4/2/98 ESP 100,000,000 827,738 --------------------------------------------------------------------------------------------------------------------- Venezuela (Republic of) Disc. Bonds, Series DL, 6.625%, 12/18/07 (2) 1,500,000 1,061,250 ---------- Total Foreign Government Obligations (Cost $14,458,053) 14,777,230 - --------------------------------------------------------------------------------------------------------------------------------- LOAN PARTICIPATIONS - 2.1% - --------------------------------------------------------------------------------------------------------------------------------- Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A, 6.812%, 9/4/06 (2)(3) 500,000 298,438 --------------------------------------------------------------------------------------------------------------------- Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 (2)(3) 1,021,540 952,586 --------------------------------------------------------------------------------------------------------------------- Morocco (Kingdom of) Loan Participation Agreement, Tranche A, 6.437%, 1/1/09 (2) 875,000 630,273 --------------------------------------------------------------------------------------------------------------------- Pulsar Internacional SA de CV, 11.80% Nts., 9/19/96 (3) 700,000 703,500 --------------------------------------------------------------------------------------------------------------------- Trinidad & Tobago Loan Participation Agreement, Tranche B, 1.772%, 9/30/00 (2)(3) JPY 92,319,750 719,660 ---------- Total Loan Participations (Cost $3,328,297) 3,304,457 - --------------------------------------------------------------------------------------------------------------------------------- MUNICIPAL BONDS AND NOTES - 0.8% - --------------------------------------------------------------------------------------------------------------------------------- San Joaquin Hills, California Transportation Corridor Agency Toll Road Capital Appreciation Revenue Bonds, Jr Lien, Zero Coupon, 9%, 1/1/28 (Cost $781,004) (7) 12,500,000 1,163,225 CORPORATE BONDS AND NOTES - 63.1% - --------------------------------------------------------------------------------------------------------------------------------- BASIC INDUSTRY - 4.9% - --------------------------------------------------------------------------------------------------------------------------------- CHEMICALS - 0.8% - --------------------------------------------------------------------------------------------------------------------------------- NL Industries, Inc.: 0%/13% Sr. Sec. Disc. Nts., 10/15/05 (8) 500,000 392,500 11.75% Sr. Sec. Nts., 10/15/03 650,000 666,250 --------------------------------------------------------------------------------------------------------------------- Texas Petrochemicals Corp., 11.125% Sr. Sub. Nts., 7/1/06 (4)(5) 200,000 204,062 ---------- 1,262,812
5 23 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- METALS/MINING - 0.5% --------------------------------------------------------------------------------------------------------------------- Carbide/Graphite Group, Inc. (The), 11.50% Sr. Nts., 9/1/03 $454,000 $ 493,725 --------------------------------------------------------------------------------------------------------------------- UCAR Global Enterprises, Inc., 12% Sr. Sub. Nts., 1/15/05 230,000 262,200 ---------- 755,925 - --------------------------------------------------------------------------------------------------------------------------------- PAPER - 3.1% --------------------------------------------------------------------------------------------------------------------- Domtar, Inc.: 11.25% Debs., 9/15/17 400,000 427,000 12% Nts., 4/15/01 250,000 289,375 --------------------------------------------------------------------------------------------------------------------- Florida Coast Paper Co. LLC/Florida Coast Paper Finance Corp., 12.75% First Mtg. Nts., 6/1/03 (4) 550,000 572,000 --------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp., 12.75% Sr. Sub. Disc. Debs., 5/15/05 500,000 528,750 --------------------------------------------------------------------------------------------------------------------- Indah Kiat International Finance Co. BV, 12.50% Sr. Sec Gtd. Nts., Series C, 6/15/06 350,000 373,625 --------------------------------------------------------------------------------------------------------------------- QUNO Corp., 9.125% Sr. Nts., 5/15/05 200,000 196,500 --------------------------------------------------------------------------------------------------------------------- Repap Wisconsin, Inc., 9.25% First Priority Sr. Sec. Nts., 2/1/02 500,000 473,750 --------------------------------------------------------------------------------------------------------------------- Riverwood International Corp.: 10.25% Sr. Nts., 4/1/06 600,000 598,500 10.875% Sr. Sub. Nts., 4/1/08 250,000 247,500 --------------------------------------------------------------------------------------------------------------------- SD Warren Co., 12% Sr. Sub. Nts., 12/15/04 250,000 266,250 --------------------------------------------------------------------------------------------------------------------- Stone Container Corp.: 10.75% First Mtg. Nts., 10/1/02 800,000 812,000 10.75% Sr. Sub. Nts., 6/15/97 100,000 102,500 ---------- 4,887,750 - --------------------------------------------------------------------------------------------------------------------------------- STEEL - 0.5% Jorgensen (Earle M.) Co., 10.75% Sr. Nts., 3/1/00 175,000 173,250 --------------------------------------------------------------------------------------------------------------------- Republic Engineered Steels, Inc., 9.875% First Mtg. Nts., 12/15/01 600,000 562,500 ---------- 735,750 - --------------------------------------------------------------------------------------------------------------------------------- CONSUMER RELATED - 11.9% - --------------------------------------------------------------------------------------------------------------------------------- CONSUMER PRODUCTS - 2.4% --------------------------------------------------------------------------------------------------------------------- Coleman Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts., Series B, 11.074%, 5/27/98 (7) 400,000 337,000 --------------------------------------------------------------------------------------------------------------------- Harman International Industries, Inc., 12% Sr. Sub. Nts., 8/1/02 1,650,000 1,806,750 --------------------------------------------------------------------------------------------------------------------- International Semi-Tech Microelectronics, Inc., 0%/11.50% Sr. Sec. Disc. Nts., 8/15/03 (8) 500,000 297,500 --------------------------------------------------------------------------------------------------------------------- Revlon Worldwide Corp., Zero Coupon Sr. Sec. Disc. Nts., 32.881%, 3/15/98 (7) 350,000 293,125 --------------------------------------------------------------------------------------------------------------------- TAG Heuer International SA, 12% Sr. Sub. Nts., 12/15/05 (4) 400,000 419,000 --------------------------------------------------------------------------------------------------------------------- Williams (J. B.) Holdings, Inc., 12% Sr. Nts., 3/1/04 600,000 592,500 ---------- 3,745,875 - --------------------------------------------------------------------------------------------------------------------------------- FOOD/BEVERAGES/TOBACCO - 0.6% - --------------------------------------------------------------------------------------------------------------------------------- Consolidated Cigar Corp., 10.50% Sr. Sub. Nts., 3/1/03 400,000 420,000 --------------------------------------------------------------------------------------------------------------------- Doane Products Co., 10.625% Sr. Nts., 3/1/06 250,000 251,250 --------------------------------------------------------------------------------------------------------------------- Foodbrands America, Inc., 10.75% Sr. Sub. Nts., 5/15/06 235,000 237,350 ---------- 908,600
6 24 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- HEALTHCARE - 2.8% -------------------------------------------------------------------------------------------------------------------- Capstone Capital Corp., 10.50% Cv. Sub. Debs., 4/1/02 $ 1,600,000 $2,040,000 -------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc., 13% Sr. Sub. Nts., 7/15/02 400,000 446,000 -------------------------------------------------------------------------------------------------------------------- IHF Holdings, Inc., 0%/15% Sr. Sub. Disc. Nts., Series B, 11/15/04 (8) 250,000 171,250 -------------------------------------------------------------------------------------------------------------------- Magellan Health Services, Inc., 11.25% Sr. Sub. Nts., Series A, 4/15/04 500,000 540,000 -------------------------------------------------------------------------------------------------------------------- Total Renal Care, Inc., 0%/12% Sr. Sub. Disc. Nts., 8/15/04 (8) 1,244,000 1,219,120 ---------- 4,416,370 - -------------------------------------------------------------------------------------------------------------------------------- HOTEL/GAMING - 2.6% -------------------------------------------------------------------------------------------------------------------- Capital Gaming International, Inc., Promissory Nts. (9) 9,500 -- -------------------------------------------------------------------------------------------------------------------- Majestic Star Casino LLC (The), 12.75% Sr. Sec. Nts., 5/15/03 (4) 450,000 488,250 -------------------------------------------------------------------------------------------------------------------- Mohegan Tribal Gaming Authority, 13.50% Sr. Sec. Nts., 11/15/02 (4) 400,000 504,000 -------------------------------------------------------------------------------------------------------------------- Players International, Inc., 10.875% Sr. Nts., 4/15/05 500,000 508,750 -------------------------------------------------------------------------------------------------------------------- Showboat Marina Casino Partnership/Showboat Marina Finance Corp., 13.50% First Mtg. Nts., 3/15/03 (4) 550,000 594,000 -------------------------------------------------------------------------------------------------------------------- Station Casinos, Inc., 9.625% Sr. Sub. Nts., 6/1/03 500,000 492,500 -------------------------------------------------------------------------------------------------------------------- Trump Atlantic City Associates/Trump Atlantic City Funding, Inc., 11.25% First Mtg. Nts., 5/1/06 1,500,000 1,515,000 ---------- 4,102,500 - -------------------------------------------------------------------------------------------------------------------------------- LEISURE - 0.2% -------------------------------------------------------------------------------------------------------------------- Gillett Holdings, Inc., 12.25% Sr. Sub. Nts., Series A, 6/30/02 (3) 278,779 293,763 - -------------------------------------------------------------------------------------------------------------------------------- RESTAURANTS - 1.8% -------------------------------------------------------------------------------------------------------------------- Apple South, Inc., 9.75% Sr. Nts., 6/1/06 500,000 493,750 -------------------------------------------------------------------------------------------------------------------- Carrols Corp., 11.50% Sr. Nts., 8/15/03 430,000 438,600 -------------------------------------------------------------------------------------------------------------------- Foodmaker, Inc.: 9.25% Sr. Nts., 3/1/99 200,000 197,500 9.75% Sr. Sub. Nts., 6/1/02 1,750,000 1,688,750 ---------- 2,818,600 - -------------------------------------------------------------------------------------------------------------------------------- TEXTILE/APPAREL - 1.5% -------------------------------------------------------------------------------------------------------------------- Clark-Schwebel, Inc., 10.50% Sr. Nts., 4/15/06 (4) 500,000 512,500 -------------------------------------------------------------------------------------------------------------------- Polysindo International Finance Co. BV, 11.375% Bonds, 6/15/06 600,000 613,500 -------------------------------------------------------------------------------------------------------------------- PT Polysindo Eka Perkasa, Zero Coupon Promissory Nts.: 19.111%, 2/28/97 (7) IDR 1,000,000,000 378,930 19.348%, 4/29/97 (7) IDR 980,000,000 359,344 -------------------------------------------------------------------------------------------------------------------- Synthetic Industries, Inc., 12.75% Sr. Sub. Debs., 12/1/02 500,000 531,250 ---------- 2,395,524 - -------------------------------------------------------------------------------------------------------------------------------- ENERGY - 4.9% -------------------------------------------------------------------------------------------------------------------- BP America, Inc., 10.875% Nts., 8/1/01 CAD 350,000 290,894 -------------------------------------------------------------------------------------------------------------------- Chesapeake Energy Corp.: 10.50% Sr. Nts., 6/1/02 500,000 525,000 9.125% Sr. Nts., 4/15/06 350,000 346,500 -------------------------------------------------------------------------------------------------------------------- Falcon Drilling, Inc., 8.875% Sr. Nts., Series B, 3/15/03 300,000 289,875 -------------------------------------------------------------------------------------------------------------------- Kelley Oil & Gas Corp., 13.50% Sr. Nts., 6/15/99 600,000 637,500 -------------------------------------------------------------------------------------------------------------------- Maxus Energy Corp., 11.50% Debs., 11/15/15 800,000 838,000
7 25 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- ENERGY (CONTINUED) - -------------------------------------------------------------------------------------------------------------------------------- Mesa Operating Co., 10.625% Gtd. Sr. Sub. Nts., 7/1/06 (5) $ 1,450,000 $1,472,656 -------------------------------------------------------------------------------------------------------------------- OPI International, Inc., 12.875% Sr. Gtd. Nts., 7/15/02 750,000 832,500 -------------------------------------------------------------------------------------------------------------------- Petroleum Heat & Power Co., Inc.: 12.25% Sub. Debs., 2/1/05 157,000 173,485 9.375% Sub. Debs., 2/1/06 650,000 614,250 -------------------------------------------------------------------------------------------------------------------- Triton Energy Corp.: 0%/9.75% Sr. Sub. Disc. Nts., 12/15/00 (8) 200,000 195,000 Zero Coupon Sr. Sub. Disc. Nts., 10.318%, 11/1/97 (7) 1,200,000 1,086,000 -------------------------------------------------------------------------------------------------------------------- Vintage Petroleum, Inc., 9% Sr. Sub. Nts., 12/15/05 250,000 236,250 ---------- 7,537,910 - -------------------------------------------------------------------------------------------------------------------------------- FINANCIAL SERVICES - 2.3% - -------------------------------------------------------------------------------------------------------------------------------- BANKS & THRIFTS - 1.2% -------------------------------------------------------------------------------------------------------------------- Banco Bamerindus do Brasil SA, 11% Sr. Unsub. Unsec. Bonds, 10/6/97 280,000 270,900 -------------------------------------------------------------------------------------------------------------------- First Nationwide (Parent) Holdings, Inc., 12.50% Sr. Nts., 4/15/03 800,000 838,000 -------------------------------------------------------------------------------------------------------------------- PT Inti Indorayon Utama, Zero Coupon Promissory Nts., 17.234%, 2/12/97 (7) IDR 1,800,000,000 699,028 ---------- 1,807,928 - -------------------------------------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 1.1% -------------------------------------------------------------------------------------------------------------------- ECM Fund, L.P.I., 14% Sub. Nts., 6/10/02 (3) 207,685 228,455 GPA Delaware, Inc., 8.75% Gtd. Nts., 12/15/98 1,500,000 1,500,000 ---------- 1,728,455 - -------------------------------------------------------------------------------------------------------------------------------- HOUSING RELATED - 1.4% - -------------------------------------------------------------------------------------------------------------------------------- BUILDING MATERIALS - 0.1% -------------------------------------------------------------------------------------------------------------------- Building Materials Corp., 0%/11.75% Sr. Deferred Coupon Nts., Series B, 7/1/04 (8) 250,000 185,625 - -------------------------------------------------------------------------------------------------------------------------------- HOMEBUILDERS/REAL ESTATE - 1.3% -------------------------------------------------------------------------------------------------------------------- First Place Tower, Inc.: 9.22% First Mtg. Bonds, 12/15/05 CAD 300,400 223,823 Units (each unit consists of one $10 principal amount of 8.50% cv. sub. debs., 12/15/15 and 40 common shares) (10) CAD 180,660 238,125 -------------------------------------------------------------------------------------------------------------------- Saul (B.F.) Real Estate Investment Trust, 11.625% Sr. Sec. Nts., Series B, 4/1/02 1,000,000 1,030,000 -------------------------------------------------------------------------------------------------------------------- Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11 (4) 700,000 532,000 ---------- 2,023,948 - -------------------------------------------------------------------------------------------------------------------------------- MANUFACTURING - 2.4% - -------------------------------------------------------------------------------------------------------------------------------- AEROSPACE/ELECTRONICS/COMPUTERS - 1.6% -------------------------------------------------------------------------------------------------------------------- Communications & Power Industries, Inc., 12% Sr. Sub. Nts., 8/1/05 1,000,000 1,062,500 -------------------------------------------------------------------------------------------------------------------- Dell Computer Corp., 11% Sr. Nts., 8/15/00 500,000 548,125 -------------------------------------------------------------------------------------------------------------------- Rohr, Inc., 11.625% Sr. Nts., 5/15/03 800,000 884,000 ---------- 2,494,625 - -------------------------------------------------------------------------------------------------------------------------------- AUTOMOTIVE - 0.8% - -------------------------------------------------------------------------------------------------------------------------------- Aftermarket Technology Corp., 12% Sr. Sub. Nts., Series B, 8/1/04 400,000 434,000
8 26 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------ AUTOMOTIVE (CONTINUED) ------------------------------------------------------------------------------------------------------------------ Collins & Aikman Products Co., 11.50% Gtd. Sr. Sub. Nts., 4/15/06 $ 250,000 $ 255,000 - ------------------------------------------------------------------------------------------------------------------------------ Foamex LP/Foamex Capital Corp., 9.50% Sr. Sec. Nts., 6/1/00 240,000 240,000 - ------------------------------------------------------------------------------------------------------------------------------ Penda Corp., 10.75% Sr. Nts., Series B, 3/1/04 350,000 327,250 ---------- 1,256,250 - ------------------------------------------------------------------------------------------------------------------------------ CAPITAL GOODS - 0.0% ------------------------------------------------------------------------------------------------------------------ Farley, Inc., Zero Coupon Sub. Debs., 14.143%, 12/30/12 (3)(7) 198,000 20,991 - ------------------------------------------------------------------------------------------------------------------------------ MEDIA - 13.5% - ------------------------------------------------------------------------------------------------------------------------------ BROADCASTING - 4.4% ------------------------------------------------------------------------------------------------------------------ American Radio Systems Corp., 9% Sr. Sub. Nts., 2/1/06 700,000 665,000 ------------------------------------------------------------------------------------------------------------------ Argyle Television, Inc., 9.75% Sr. Sub. Nts., 11/1/05 200,000 188,500 ------------------------------------------------------------------------------------------------------------------ Outlet Broadcasting, Inc., 10.875% Sr. Sub. Nts., 7/15/03 1,000,000 1,114,594 ------------------------------------------------------------------------------------------------------------------ Paxson Communications Corp., 11.625% Sr. Sub. Nts., 10/1/02 1,200,000 1,254,000 ------------------------------------------------------------------------------------------------------------------ SFX Broadcasting, Inc., 10.75% Sr. Sub. Nts., 5/15/06 (4) 300,000 300,000 ------------------------------------------------------------------------------------------------------------------ Sinclair Broadcast Group, Inc.: 10% Sr. Sub. Nts., 12/15/03 345,000 332,925 10% Sr. Sub. Nts., 9/30/05 400,000 390,000 ------------------------------------------------------------------------------------------------------------------ Summit Communications Group, Inc., 10.50% Sr. Sub. Debs., 4/15/05 850,000 924,375 ------------------------------------------------------------------------------------------------------------------ Univision Television Group, Inc., 11.75% Sr. Sub. Nts., 1/15/01 700,000 745,500 ------------------------------------------------------------------------------------------------------------------ Young Broadcasting, Inc., 9% Sr. Sub. Nts., 1/15/06 950,000 850,250 ---------- 6,765,144 - ------------------------------------------------------------------------------------------------------------------------------ CABLE TELEVISION - 4.4% ------------------------------------------------------------------------------------------------------------------ American Telecasting, Inc., 0%/14.50% Sr. Disc. Nts., 6/15/04 (8) 50,106 35,074 ------------------------------------------------------------------------------------------------------------------ Australis Media Ltd., Units (each unit consists of $1,000 principal amount of 0%/14% sr. sub. disc. nts., 5/15/03 and one warrant to purchase 57.721 ordinary shares) (8)(10) 1,650,000 990,000 ------------------------------------------------------------------------------------------------------------------ Bell Cablemedia PLC, 0%/11.95% Sr. Disc. Nts., 7/15/04 (8) 1,700,000 1,198,500 ------------------------------------------------------------------------------------------------------------------ Cablevision Industries Corp., 9.25% Sr. Debs., Series B, 4/1/08 600,000 607,500 ------------------------------------------------------------------------------------------------------------------ Cablevision Systems Corp.: 10.50% Sr. Sub. Debs., 5/15/16 250,000 243,750 10.75% Sr. Sub. Debs., 4/1/04 500,000 517,500 ------------------------------------------------------------------------------------------------------------------ Fundy Cable Ltd./Ltee, 11% Sr. Sec. Second Priority Nts., 11/15/05 400,000 407,000 ------------------------------------------------------------------------------------------------------------------ Helicon Group LP/Helicon Capital Corp., 9% Sr. Sec. Nts., Series B, 11/1/03 (2) 500,000 497,500 ------------------------------------------------------------------------------------------------------------------ International CableTel, Inc.: 0%/10.875% Sr. Deferred Coupon Nts., 10/15/03 (8) 100,000 73,000 0%/11.50% Sr. Deferred Coupon Nts., Series A, 2/1/06 (8) 500,000 282,500 0%/12.75% Sr. Deferred Coupon Nts., 4/15/05 (8) 350,000 225,750 ------------------------------------------------------------------------------------------------------------------ People's Choice TV Corp., 0%/13.125% Sr. Disc. Nts., 6/1/04 (8) 250,000 143,750
9 27 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------- CABLE TELEVISION (CONTINUED) --------------------------------------------------------------------------------------------------------------------- Rogers Cablesystems Ltd., 10% Sr. Sec. Second Priority $ 800,000 $ 782,000 Debs., 12/1/07 --------------------------------------------------------------------------------------------------------------------- TKR Cable I, Inc., 10.50% Sr. Debs., 10/30/07 300,000 334,004 --------------------------------------------------------------------------------------------------------------------- United International Holdings, Inc.: 0%/14% Sr. Disc. Nts., 5/15/06 (4)(8) 350,000 184,625 Zero Coupon Sr. Sec. Disc. Nts., 12.057%, 11/15/99 (7) 500,000 330,000 --------------------------------------------------------------------------------------------------------------------- Videotron Holdings PLC, 0%/11% Sr. Disc. Nts., 8/15/05 (8) 25,000 16,375 ------------ 6,868,828 - ---------------------------------------------------------------------------------------------------------------------------- DIVERSIFIED MEDIA - 3.7% --------------------------------------------------------------------------------------------------------------------- Ackerley Communications, Inc., 10.75% Sr. Sec. Nts., Series A, 10/1/03 750,000 780,937 --------------------------------------------------------------------------------------------------------------------- EchoStar Communications Corp., 0%/12.875% Sr. Disc. Nts., 6/1/04 (8) 1,800,000 1,314,000 --------------------------------------------------------------------------------------------------------------------- GSPI Corp., 10.15% First Mtg. Bonds, 6/24/10 (4) 475,896 535,859 --------------------------------------------------------------------------------------------------------------------- Heritage Media Corp., 8.75% Sr. Sub. Nts., 2/15/06 350,000 327,250 --------------------------------------------------------------------------------------------------------------------- Lamar Advertising Co., 11% Sr. Sec. Nts., 5/15/03 500,000 513,750 --------------------------------------------------------------------------------------------------------------------- Outdoor Systems, Inc., 10.75% Sr. Nts., 8/15/03 300,000 312,000 --------------------------------------------------------------------------------------------------------------------- Panamsat LP/Panamsat Capital Corp.: 0%/11.375% Sr. Sub. Disc. Nts., 8/1/03 (8) 1,850,000 1,618,750 9.75% Sr. Sec. Nts., 8/1/00 350,000 364,000 ------------ 5,766,546 - ---------------------------------------------------------------------------------------------------------------------------- ENTERTAINMENT/FILM - 1.0% --------------------------------------------------------------------------------------------------------------------- Imax Corp., 7% Sr. Nts., 3/1/01 (11) 1,600,000 1,568,000 - ---------------------------------------------------------------------------------------------------------------------------- OTHER - 0.8% - ---------------------------------------------------------------------------------------------------------------------------- CONGLOMERATES - 0.5% --------------------------------------------------------------------------------------------------------------------- MacAndrews & Forbes Group, Inc., 12.25% Sub. Nts., 7/1/96 750,000 753,750 - ---------------------------------------------------------------------------------------------------------------------------- SERVICES - 0.3% --------------------------------------------------------------------------------------------------------------------- Protection One, Inc., 0%/13.625% Sr. Disc. Nts., 6/30/05 (8) 550,000 470,250 - ---------------------------------------------------------------------------------------------------------------------------- RETAIL - 2.7% - ---------------------------------------------------------------------------------------------------------------------------- SPECIALTY RETAILING - 0.6% --------------------------------------------------------------------------------------------------------------------- Eye Care Centers of America, Inc., 12% Sr. Nts., 10/1/03 630,000 652,050 --------------------------------------------------------------------------------------------------------------------- Finlay Fine Jewelry Corp., 10.625% Sr. Nts., 5/1/03 300,000 301,500 ------------ 953,550 - ---------------------------------------------------------------------------------------------------------------------------- SUPERMARKETS - 2.1% --------------------------------------------------------------------------------------------------------------------- Grand Union Co., 12% Sr. Nts., 9/1/04 1,000,000 938,750 --------------------------------------------------------------------------------------------------------------------- Kash 'N Karry Food Stores, Inc., 11.50% Sr. Nts., 2/1/03 564,400 568,633 --------------------------------------------------------------------------------------------------------------------- Penn Traffic Co.: 10.25% Sr. Nts., 2/15/02 400,000 366,000 11.50% Sr. Nts., 4/15/06 450,000 419,625 --------------------------------------------------------------------------------------------------------------------- Ralph's Grocery Co.: 10.45% Sr. Nts., 6/15/04 300,000 288,750 10.45% Sr. Nts., 6/15/04 (4) 750,000 721,875 ------------ 3,303,633 - ---------------------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 1.9% - ---------------------------------------------------------------------------------------------------------------------------- AIR TRANSPORTATION - 0.5% --------------------------------------------------------------------------------------------------------------------- Atlas Air, Inc., 12.25% Pass-Through Certificates, 12/1/02 750,000 819,375
10 28 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------- RAILROADS - 1.0% -------------------------------------------------------------------------------------------------------------------- Transtar Holdings LP/Transtar Capital Corp., 0%/13.375% Sr. Disc. Nts., Series B, 12/15/03 (8) $ 2,200,000 $ 1,518,000 - --------------------------------------------------------------------------------------------------------------------------- SHIPPING - 0.4% -------------------------------------------------------------------------------------------------------------------- Trans Ocean Container Corp., 12.25% Sr. Sub. Nts., 7/1/04 600,000 621,000 - --------------------------------------------------------------------------------------------------------------------------- UTILITIES - 16.4% - --------------------------------------------------------------------------------------------------------------------------- ELECTRIC UTILITIES - 2.7% -------------------------------------------------------------------------------------------------------------------- California Energy Co., 0%/10.25% Sr. Disc. Nts., 1/15/04 (8) 1,000,000 980,000 -------------------------------------------------------------------------------------------------------------------- El Paso Electric Co., 9.40% First Mtg. Bonds, Series E, 5/1/11 1,000,000 997,500 -------------------------------------------------------------------------------------------------------------------- First PV Funding Corp.: 10.15% Lease Obligation Bonds, Series 1986B, 1/15/16 500,000 526,250 10.30% Lease Obligation Bonds, Series 1986A, 1/15/14 1,000,000 1,052,500 -------------------------------------------------------------------------------------------------------------------- Subic Power Corp., 9.50% Sr. Sec. Nts., 12/28/08 646,551 653,017 ------------- 4,209,267 - --------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS - 13.7% -------------------------------------------------------------------------------------------------------------------- A+ Network, Inc., 11.875% Sr. Sub. Nts., 11/1/05 1,025,000 1,066,000 -------------------------------------------------------------------------------------------------------------------- American Communications Services, Inc.: 0%/12.75% Sr. Disc. Nts., 4/1/06 (8) 600,000 315,000 0%/13% Sr. Disc. Nts., 11/1/05 (8) 500,000 280,000 -------------------------------------------------------------------------------------------------------------------- Arch Communications Group, Inc., 0%/10.875% Sr. Disc. Nts., 3/15/08 (8) 100,000 52,000 -------------------------------------------------------------------------------------------------------------------- Brooks Fiber Properties, Inc., 0%/10.875% Sr. Disc. Nts., 3/1/06 (4)(8) 250,000 134,375 -------------------------------------------------------------------------------------------------------------------- Celcaribe SA, 0%/13.50% Sr. Sec. Nts., 3/15/04 (8) 1,500,000 1,233,750 -------------------------------------------------------------------------------------------------------------------- CellNet Data Systems, Inc., 0%/13% Sr. Disc. Nts., 6/15/05 (4)(8) 600,000 429,000 -------------------------------------------------------------------------------------------------------------------- Cellular Communications International, Inc., Zero Coupon Sr. Disc. Nts., 12.215%, 8/15/00 (7) 2,920,000 1,825,000 -------------------------------------------------------------------------------------------------------------------- Cellular, Inc., 0%/11.75% Sr. Sub. Disc. Nts., 9/1/03 (8) 2,000,000 1,570,000 -------------------------------------------------------------------------------------------------------------------- Comcast Cellular Corp., Zero Coupon Nts., Series B, 7.185%, 3/5/00 (7) 500,000 345,000 -------------------------------------------------------------------------------------------------------------------- Comunicacion Celular SA, 0%/13.125% Sr. Deferred Coupon Bonds, 11/15/03 (8) 750,000 483,750 -------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc., 0%/15% Sr. Sec. Disc. Nts., 7/15/05 (8) 1,750,000 1,115,625 -------------------------------------------------------------------------------------------------------------------- GST Telecommunications, Inc., 0%/13.875% Cv. Sr. Sub. Disc. Nts., 12/15/05 (4)(8) 178,000 176,443 -------------------------------------------------------------------------------------------------------------------- GST USA, Inc., 0%/13.875% Bonds, 12/15/05 (8) 1,499,000 869,420 -------------------------------------------------------------------------------------------------------------------- Horizon Cellular Telephone LP/Horizon Finance Corp., 0%/11.375% Sr. Sub. Disc. Nts., 10/1/00 (8) 2,250,000 2,120,625 -------------------------------------------------------------------------------------------------------------------- Hyperion Telecommunications, Inc., Units (each unit consists of $1,000 principal amount of 0%/13% sr. disc. nts., 4/15/03 and one warrant to purchase 1.8645 shares of common stock) (4)(8)(10) 250,000 141,250 -------------------------------------------------------------------------------------------------------------------- In-Flight Phone Corp., 0%/14% Sr. Disc. Nts., 5/15/02 (8) 500,000 178,750 -------------------------------------------------------------------------------------------------------------------- IntelCom Group (USA), Inc.: 0%/12.50% Gtd. Sr. Disc. Nts., 5/1/06 (4)(8) 735,000 402,413 0%/13.50% Sr. Disc. Nts., 9/15/05 (8) 2,050,000 1,235,125 -------------------------------------------------------------------------------------------------------------------- InterCel, Inc., 0%/12% Sr. Disc. Nts., 5/1/06 (8) 500,000 275,000
11 29 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------ TELECOMMUNICATIONS (CONTINUED) ----------------------------------------------------------------------------------------------------------------------- MFS Communications Co., Inc.: 0%/8.875% Sr. Disc. Nts., 1/15/06 (8) $ 150,000 $ 91,125 0%/9.375% Sr. Disc. Nts., 1/15/04 (8) 1,650,000 1,254,000 ----------------------------------------------------------------------------------------------------------------------- Occidente y Caribe Celular SA, Units (each unit consists of (4)(8)(10) 300,000 155,250 $1,000 principal amount of 0%/14% sr. disc. nts., 3/15/04 and one warrant to purchase 5.709 ordinary shares) ----------------------------------------------------------------------------------------------------------------------- Petersburg Long Distance, Inc.: 9% Cv. Sub. Nts., 6/1/06 (4) 170,000 200,600 Units (each unit consists of $1,000 principal amount of (4)(8)(10) 850,000 671,500 0%/14% sr. disc. nts., 6/1/04 and one warrant to purchase 34 ordinary shares) ----------------------------------------------------------------------------------------------------------------------- PriCellular Wireless Corp.: 0%/12.25% Sr. Sub. Disc. Nts., 10/1/03 (8) 750,000 596,250 0%/14% Sr. Sub. Disc. Nts., 11/15/01 (8) 2,000,000 1,820,000 ----------------------------------------------------------------------------------------------------------------------- Teleport Communications Group, Inc., 0%/11.125% Sr. Disc. (5)(8) 1,750,000 1,019,375 Nts., 7/1/07 ----------------------------------------------------------------------------------------------------------------------- Western Wireless Corp., 10.50% Sr. Sub. Nts., 6/1/06 1,200,000 1,201,500 ------------- 21,258,126 ------------- Total Corporate Bonds and Notes (Cost $95,470,094) 98,254,670
SHARES - ------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS - 3.0% - ------------------------------------------------------------------------------------------------------------------------------- American Communications Services, Inc. (12) 2,700 35,100 ------------------------------------------------------------------------------------------------------------------------ Australis Media Ltd. (3)(12) 100,000 33,843 ------------------------------------------------------------------------------------------------------------------------ Berg Electronics Corp. (3)(12) 11,246 253,738 ------------------------------------------------------------------------------------------------------------------------ Celcaribe SA (4)(12) 203,250 345,525 ------------------------------------------------------------------------------------------------------------------------ EchoStar Communications Corp., Cl. A (12) 2,700 76,275 ------------------------------------------------------------------------------------------------------------------------ ECM Fund, L.P.I. (3) 150 150,000 ------------------------------------------------------------------------------------------------------------------------ El Paso Electric Co. (12) 42,384 254,304 ------------------------------------------------------------------------------------------------------------------------ Equitable Bag, Inc. (3)(12) 3,723 9,307 ------------------------------------------------------------------------------------------------------------------------ Gillett Holdings, Inc. (3)(12) 22,355 670,650 ------------------------------------------------------------------------------------------------------------------------ Grand Union Co. (12) 26,511 172,321 ------------------------------------------------------------------------------------------------------------------------ GST Telecommunications, Inc. (12) 37,800 496,125 ------------------------------------------------------------------------------------------------------------------------ Gulfstream Holding, Inc. (12) 56 -- ------------------------------------------------------------------------------------------------------------------------ Gulfstream Housing Corp. (12) 27,850 -- ------------------------------------------------------------------------------------------------------------------------ IntelCom Group, Inc. (12) 3,000 75,000 ------------------------------------------------------------------------------------------------------------------------ J. Ray McDermott, SA (12) 10,965 274,125 ------------------------------------------------------------------------------------------------------------------------ Kash 'N Karry Food Stores, Inc. (12) 6,292 163,592 ------------------------------------------------------------------------------------------------------------------------ New World Communications Group, Inc., Cl. B (12) 2,093 30,610 ------------------------------------------------------------------------------------------------------------------------ Omnipoint Corp. (3)(12) 46,875 1,157,813 ------------------------------------------------------------------------------------------------------------------------ Teleport Communications Group, Inc., Cl. A (12) 4,300 82,238 ------------------------------------------------------------------------------------------------------------------------ Triangle Wire & Cable, Inc. (3)(12) 21,111 21,111 ------------------------------------------------------------------------------------------------------------------------ Walter Industries, Inc. (12) 23,455 331,302 -------------- Total Common Stocks (Cost $3,483,076) 4,632,979
12 30 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ----------------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS - 5.6% - ----------------------------------------------------------------------------------------------------------------------------- BankAmerica Corp., 8.375%, Series K 13,000 $ 331,500 ---------------------------------------------------------------------------------------------------------------------- Cablevision Systems Corp., 8.50% Cum. Cv., Series I 25,000 650,000 ---------------------------------------------------------------------------------------------------------------------- California Federal Bank, 10.625% Non-Cum., Series B 7,000 766,500 ---------------------------------------------------------------------------------------------------------------------- Earthwatch, Inc., 12% Cv. Sr. Preferred Stock, Series C (4)(13) 90,000 931,500 ---------------------------------------------------------------------------------------------------------------------- El Paso Electric Co., 11.40% Series A Preferred Stock (13) 2,950 309,750 ---------------------------------------------------------------------------------------------------------------------- Fidelity Federal Bank, 12% Non-Cum. Exchangeable Perpetual 20,000 550,000 Preferred Stock, Series A ---------------------------------------------------------------------------------------------------------------------- First Nationwide Bank, 11.50% Non-Cum. 8,500 930,750 ---------------------------------------------------------------------------------------------------------------------- Glendale Federal Bank, F.S.B., 8.75% Non-Cum. Cv., Series E 16,500 792,000 ---------------------------------------------------------------------------------------------------------------------- K-III Communications Corp., $11.625 Exchangeable, Series B (13) 7,954 801,380 ---------------------------------------------------------------------------------------------------------------------- Kelley Oil & Gas Corp., $2.625 Cv. 4,000 89,000 ---------------------------------------------------------------------------------------------------------------------- Navistar International Corp., $6.00 Cv., Series G 2,500 139,062 ---------------------------------------------------------------------------------------------------------------------- Pantry Pride, Inc., $14.875 Exchangeable, Series B 2,000 200,500 ---------------------------------------------------------------------------------------------------------------------- Prime Retail, Inc., $19.00 Cv., Series B 17,000 306,000 ---------------------------------------------------------------------------------------------------------------------- SDW Holdings Corp., 15% Cum. Sr. Exchangeable Preferred Stock (4)(12) 37,500 1,181,250 ---------------------------------------------------------------------------------------------------------------------- Walden Residential Properties, Inc., 9.16% Cv., Series A 30,000 742,500 ---------- Total Preferred Stocks (Cost $7,952,366) 8,721,692
UNITS - ----------------------------------------------------------------------------------------------------------------------------- RIGHTS, WARRANTS AND CERTIFICATES - 0.9% - ----------------------------------------------------------------------------------------------------------------------------- American Communications Services, Inc. Wts., Exp. 11/05 (4) 300 30,000 ---------------------------------------------------------------------------------------------------------------------- American Telecasting, Inc. Wts., Exp. 6/99 6,000 36,000 ---------------------------------------------------------------------------------------------------------------------- Ames Department Stores, Inc.: Excess Cash Flow Payment Certificates, Series AG-7A (3) 12,400 124 Litigation Trust (3) 39,658 397 ---------------------------------------------------------------------------------------------------------------------- Capital Gaming International, Inc. Wts., Exp. 2/99 21,112 1,056 ---------------------------------------------------------------------------------------------------------------------- Casino America, Inc. Wts., Exp. 11/96 1,631 -- ---------------------------------------------------------------------------------------------------------------------- Cellular Communications International, Inc. Wts., Exp. 8/03 2,920 43,800 ---------------------------------------------------------------------------------------------------------------------- Communication Cellular SA Wts., Exp. 11/03 (4) 750 3,750 ---------------------------------------------------------------------------------------------------------------------- Digicon, Inc. Wts., Exp. 7/96 1,566 49 ---------------------------------------------------------------------------------------------------------------------- Eye Care Centers of America, Inc. Wts., Exp. 10/03 (4) 630 3,150 ---------------------------------------------------------------------------------------------------------------------- Foamex LP/JPS Automotive Corp. Wts., Exp. 7/99 (3) 500 2,500 ---------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp. Wts., Exp. 11/02 14,410 112,578 ---------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc. Wts., Exp. 7/05 (4) 52,500 367,500 ---------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc. Wts., Exp. 11/99 (4) 400 10,000 ---------------------------------------------------------------------------------------------------------------------- IHF Holdings, Inc. Wts., Exp. 3/99 250 30,000 ---------------------------------------------------------------------------------------------------------------------- In-Flight Phone Corp. Wts., Exp. 8/02 (4) 950 -- ---------------------------------------------------------------------------------------------------------------------- IntelCom Group, Inc. Wts., Exp. 9/05 (4) 5,940 114,345 ---------------------------------------------------------------------------------------------------------------------- Jewel Recovery LP, Participation Units of Limited Partners' 2,360 -- Interest ---------------------------------------------------------------------------------------------------------------------- Omnipoint Corp. Wts., Exp. 11/00 7,500 185,250 ---------------------------------------------------------------------------------------------------------------------- People's Choice TV Corp. Wts., Exp. 6/00 250 250 ---------------------------------------------------------------------------------------------------------------------- Protection One, Inc. Wts.: Exp. 11/03 28,000 416,500 Exp. 6/05 1,600 20,400
13 31 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
MARKET VALUE UNITS (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- RIGHTS, WARRANTS AND CERTIFICATES (CONTINUED) - --------------------------------------------------------------------------------------------------------------------------------- SDW Holdings Corp., Cl. B Wts., Exp. 12/06 (4) 3,750 $ 48,750 -------------------------------------------------------------------------------------------------------------------------- Terex Corp. Rts., Exp. 7/96 (4) 744 37 -------------------------------------------------------------------------------------------------------------------------- Trizec Corp. Wts., Exp. 7/99 3,970 3,343 -------------------------------------------------------------------------------------------------------------------------- UGI Corp. Wts., Exp. 3/98 6,000 300 -------------------------------------------------------------------------------------------------------------------------- United International Securities Ltd. Wts., Exp. 11/99 1,440 41,760 ---------- Total Rights, Warrants and Certificates (Cost $305,906) 1,471,839
PRINCIPAL AMOUNT(1) - ----------------------------------------------------------------------------------------------------------------------------- STRUCTURED INSTRUMENTS - 2.6% - ----------------------------------------------------------------------------------------------------------------------------- Bayerische Landesbank Girozentrale, New York Branch, 14% CD $ 250,000 250,400 Linked Nts., 12/17/96 (indexed to the cross currency rates of Greek Drachma and European Currency Unit) ---------------------------------------------------------------------------------------------------------------------- Bayerische Landesbank Girozentrale, New York Branch, 5.60% NZD 905,113 671,814 CD Linked Nts., 1/30/97 (indexed to the closing Nikkei 225 Index on 1/23/97, 10 yr. Japanese Yen swap rate & New Zealand Dollar on 1/28/97) ----------------------------------------------------------------------------------------------------------------------- Goldman, Sachs & Co., Argentina Local Market Securities (3) 695,652 645,218 Trust, 11.30%, 4/1/00 [representing debt of Argentina (Republic of) Bonos del Tesoro Bonds, Series 10, 5.469%, 4/1/00 and an interest rate swap between Goldman Sachs and the Trust] ----------------------------------------------------------------------------------------------------------------------- Internationale Nederlanden Bank NV, Prague Branch, Zero (7) CZK 8,600,000 287,394 Coupon Promissory Nts., 10.488%, 4/28/97 ----------------------------------------------------------------------------------------------------------------------- Internationale Nederlanden (U.S.) Capital Holdings Corp., (7) 420,000 372,330 Zero Coupon Chilean Peso Linked Nts., Zero Coupon, 11.813%, 6/23/97 ----------------------------------------------------------------------------------------------------------------------- Internationale Nederlanden (U.S.) Capital Holdings Corp., (7) 350,000 312,515 Zero Coupon Czech Crown Linked Nts., 11.911%, 6/26/97 ----------------------------------------------------------------------------------------------------------------------- Salomon Brothers, Inc., Zero Coupon Brazilian Credit Linked (7) 800,000 754,160 Nts., 12.638%, 1/3/97 (indexed to the Brazilian National Treasury Nts., Zero Coupon, 12.638, 1/2/97) ----------------------------------------------------------------------------------------------------------------------- Swiss Bank Corp., New York Branch, 6.05% CD Linked Nts., 450,000 454,568 6/20/97 (indexed to the closing Nikkei 225 Index on 1/23/97 5 yr. & 3 mos. Japanese Yen Swap rate & New Zealand Dollar) ----------------------------------------------------------------------------------------------------------------------- United Mexican States Linked Nts. (indexed to the greater of 300,000 348,000 ---------- Cetes Option Amount or USD LIBOR Option Amount, 11/27/96) Total Structured Instruments (Cost $4,022,363) 4,096,399
14 32 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT - 10.2% - -------------------------------------------------------------------------------------------------------------------------------- Repurchase agreement with Canadian Imperial Bank of Commerce, 5.45%, dated 6/28/96, to be repurchased at $15,807,176 on 7/1/96, collateralized by U.S. Treasury Bonds, 9.125%-11.25%, 2/15/15-5/11/18, with a value of $5,585,108, and U.S. Treasury Nts., 5.25%-8.50%, 1/11/97-11/15/04, with a value of $10,555,109 (Cost $15,800,000) $ 15,800,000 $ 15,800,000 ------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $149,958,141) 100.6% 156,651,526 ------------------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (0.6) (944,376) ------------ ------------ NET ASSETS 100.0% $ 155,707,150 ============ ==============
1. Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: AUD - Australian Dollar IEP - Irish Punt CAD - Canadian Dollar ITL - Italian Lira CZK - Czech Koruna JPY - Japanese Yen DEM - German Deutsche Mark NZD - New Zealand Dollar DKK - Danish Krone PLZ - Polish Zloty ESP - Spanish Peseta PTE - Portuguese Escudo GBP - British Pound Sterling SEK - Swedish Krona IDR - Indonesian Rupiah 2. Represents the current interest rate for a variable rate security. 3. Identifies issues considered to be illiquid - See applicable note of Notes to Financial Statements. 4. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $12,280,442 or 7.89% of the Fund's net assets, at June 30, 1996. 5. When-issued security to be delivered and settled after June 30, 1996. 6. Indexed instrument for which the principal amount and/or interest due at maturity is affected by the relative value of a foreign index. 7. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 8. Denotes a step bond: a zero coupon bond that converts to a fixed rate of interest at a designated future date. 9. Non-income producing--issuer is in default of interest payment. 10. 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. 11. Represents the current interest rate for an increasing rate security. 12. Non-income producing security. 13. Interest or dividend is paid in kind. 15 33 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Statement of Investments (Continued)
- ------------------------------------------------------------------------------------------------------------------------------------ 14. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows: CONTRACTS/ PRINCIPAL SUBJECT EXPIRATION EXERCISE PREMIUM MARKET VALUE TO CALL DATE PRICE RECEIVED (NOTE 1) ----------------------------------------------------------------------------------------------------------------------------- Call option on Australian Dollar 248,000 7/3/96 1.25 AUD $ 1,885 $ 198 Call option on Czech Koruna 280,000 9/6/96 28.357CZK 3,752 6,896 Call option on Mexican Peso 270,000 8/5/96 8.03MXP 7,263 9,611 Call option on Morocco (Kingdom of) Loan Participation Agreement, Tranche A, 6.437%, 1/1/09 450,000 7/12/96 $71.25 4,275 5,536 ------- ------- $17,175 $22,241 ======= =======
See accompanying Notes to Financial Statements. 16 34 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ MORTGAGE-BACKED OBLIGATIONS - 26.4% - ------------------------------------------------------------------------------------------------------------------------------------ GOVERNMENT AGENCY - 21.0% - ------------------------------------------------------------------------------------------------------------------------------------ FHLMC/FNMA/SPONSORED - 16.9% ----------------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., Gtd. Multiclass Mtg. Participation $ 5,188,488 $ 4,997,967 Certificates, 7%, 4/1/26 ----------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn.: 6.50%, 3/1/11-5/1/11 25,017,373 24,211,064 7%, 4/1/04-11/1/25 10,090,581 9,725,799 7.50%, 1/1/08-1/1/26 5,457,662 5,398,311 8%, 5/1/17 625,038 636,345 Collateralized Mtg. Obligations, Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, 8.75%, 11/25/05 3,000,000 3,123,750 Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, 10.40%, 4/25/19 1,793,536 1,914,026 Interest-Only Stripped Mtg.-Backed Security: Trust 218, Cl. 2, 12.588%-13.20%, 4/1/23 (2) 7,725,412 2,569,907 Trust 257, Cl. 2, 11.448%-15.373%, 2/1/24 (2) 3,529,536 1,219,897 --------------- 53,797,066 - ------------------------------------------------------------------------------------------------------------------------------------ GNMA/GUARANTEED - 4.1% ----------------------------------------------------------------------------------------------------------------------------- Government National Mortgage Assn.: 6%, 10/20/25 4,842,429 4,863,639 7%, 1/15/09-10/20/24 8,199,401 8,049,413 --------------- 12,913,052 - ------------------------------------------------------------------------------------------------------------------------------------ PRIVATE - 5.4% - ------------------------------------------------------------------------------------------------------------------------------------ COMMERCIAL - 3.8% ----------------------------------------------------------------------------------------------------------------------------- FDIC Trust, Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, Series 1994-C1: Cl. 2-D, 8.70%, 9/25/25 (3) 1,500,000 1,549,688 Cl. 2-E, 8.70%, 9/25/25 (3) 1,500,000 1,537,031 ----------------------------------------------------------------------------------------------------------------------------- Merrill Lynch Mortgage Investors, Inc., Mtg. Pass-Through (4) 964,447 967,160 Certificates, Series 1995-C2, Cl. C, 7.906%, 6/15/21 ----------------------------------------------------------------------------------------------------------------------------- Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through Certificates, Series 1996-C1, Cl. D-1, 7.51%, 2/1/28 (3)(4) 1,000,000 951,250 ----------------------------------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates: Series 1992-CHF, Cl. C, 8.25%, 12/25/20 1,030,504 1,041,936 Series 1994-C1, Cl. C, 8%, 6/25/26 1,500,000 1,505,625 Series 1995-C1, Cl. D, 6.90%, 2/25/27 3,000,000 2,725,313 ----------------------------------------------------------------------------------------------------------------------------- Structured Asset Securities Corp., Multiclass Pass-Through Certificates, Series 1996-CFL, Cl. D, 7.034%, 2/25/28 1,800,000 1,713,375 --------------- 11,991,378 - ------------------------------------------------------------------------------------------------------------------------------------ MANUFACTURED HOUSING - 0.2% ----------------------------------------------------------------------------------------------------------------------------- Green Tree Financial Corp., Series 1994-6, Cl. A3, 7.70%, 1/15/20 738,000 750,679
17 35 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ MULTI-FAMILY - 1.1% ----------------------------------------------------------------------------------------------------------------------------- Countrywide Funding Corp., Series 1993-12, Cl. B1, 6.625%, 2/25/24 $ 1,000,000 $ 875,547 ----------------------------------------------------------------------------------------------------------------------------- Merrill Lynch Trust, Collateralized Mtg. Obligations, Gtd. Multiclass Mtg. Participation Certificates, Series 43, Cl. E, 6.50%, 8/27/15 500,000 471,715 ----------------------------------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates, 2,092,478 2,152,637 Series 1991-M5, Cl. A, 9%, 3/25/17 --------------- 3,499,899 - ------------------------------------------------------------------------------------------------------------------------------------ OTHER - 0.0% ----------------------------------------------------------------------------------------------------------------------------- Salomon Brothers Mortgage Securities VI: Interest-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. B, (2) 108,078 27,898 9.549%, 10/23/17 Principal-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. A, (5) 159,996 106,198 9.489%, 10/23/17 --------------- 134,096 - ------------------------------------------------------------------------------------------------------------------------------------ RESIDENTIAL - 0.3% ----------------------------------------------------------------------------------------------------------------------------- Contimortgage Home Equity Loan Trust, Series 1995-2, Cl. A2, 7.95%, 4/15/10 554,000 559,367 ----------------------------------------------------------------------------------------------------------------------------- Ryland Mortgage Securities Corp. III, Sub. Bonds, Series 1992-A, Cl. (4) 293,427 291,502 1A, 7.17%, 3/29/30 --------------- 850,869 --------------- Total Mortgage-Backed Obligations (Cost $83,636,632) 83,937,039 - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GOVERNMENT OBLIGATIONS - 31.5% - ------------------------------------------------------------------------------------------------------------------------------------ TREASURY - 31.5% - ------------------------------------------------------------------------------------------------------------------------------------ U.S. Treasury Bonds: 10.375%, 11/15/12 365,000 463,550 6.875%, 8/15/25 (6) 3,500,000 3,463,904 7.125%, 2/15/23 3,000,000 3,030,936 7.50%, 11/15/16 6,780,000 7,123,237 8%, 11/15/21 5,000,000 5,565,625 8.125%, 8/15/19 2,060,000 2,311,062 8.875%, 8/15/17 740,000 888,231 9.25%, 2/15/16 740,000 915,518 STRIPS, Zero Coupon, 7.329%, 5/15/15 (7) 1,107,000 292,936 STRIPS, Zero Coupon, 7.341%, 8/15/14 (7) 3,690,000 1,031,118 ----------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Nts.: 5.875%, 11/15/05 3,000,000 2,826,561 6%, 12/31/97 3,000,000 3,000,936 6.375%, 6/30/97 1,000,000 1,005,625 6.50%, 5/15/05-8/15/05 18,000,000 17,740,305 6.75%, 6/30/99 16,340,000 16,539,134 7.25%, 5/15/04-8/15/04 11,980,000 12,406,787 7.375%, 11/15/97 2,000,000 2,035,626 7.50%, 11/15/01-2/15/05 12,486,000 13,115,585 7.75%, 12/31/99 2,000,000 2,085,000
18 36 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ U.S. Treasury Nts. (Continued) 7.875%, 11/15/04 $ 2,000,000 $ 2,150,624 9.25%, 8/15/98 2,000,000 2,120,624 --------------- Total U.S. Government Obligations (Cost $99,580,053) 100,112,924 - ------------------------------------------------------------------------------------------------------------------------------------ FOREIGN GOVERNMENT OBLIGATIONS - 14.2% - ------------------------------------------------------------------------------------------------------------------------------------ Bonos de la Tesoreria de la Federacion, Zero Coupon, 37.779%, 3/6/97 (7) MXP 5,300,000 567,987 ----------------------------------------------------------------------------------------------------------------------------- Canada (Government of) Real Return Debs., 4.517%, 12/1/21 (8) CAD 3,390,000 2,443,167 ----------------------------------------------------------------------------------------------------------------------------- CEZ AS, Zero Coupon Disc. Promissory Nts., 10.762%, 7/1/96 (7) CZK 14,000,000 508,534 ----------------------------------------------------------------------------------------------------------------------------- Corporacion Andina de Fomento Sr. Unsec. Debs.: 6.625%, 10/14/98 (3) 1,000,000 998,125 7.25%, 4/30/98 (3) 1,000,000 1,004,688 ----------------------------------------------------------------------------------------------------------------------------- Denmark (Kingdom of) Bonds: 8%, 3/15/06 DKK 17,000,000 3,014,340 8%, 5/15/03 DKK 22,140,000 3,995,567 ----------------------------------------------------------------------------------------------------------------------------- Financiera Energetica Nacional SA, 9.375% Eurobonds, 6/15/06 (3) 2,350,000 2,355,875 ----------------------------------------------------------------------------------------------------------------------------- Germany (Republic of) Bonds: 7.375%, 12/2/02 DEM 1,250,000 875,495 8.25%, 9/20/01 DEM 1,950,000 1,424,830 ----------------------------------------------------------------------------------------------------------------------------- Italy (Republic of) Certificati di Credito del Tesoro Nts., 11.20%, (4) ITL 2,835,000,000 1,893,759 8/1/00 ----------------------------------------------------------------------------------------------------------------------------- National Treasury Management Agency (Irish Government) Bonds, 8%, IEP 1,495,000 2,493,462 10/18/00 ----------------------------------------------------------------------------------------------------------------------------- New South Wales Treasury Corp. Gtd. Bonds, 12%, 12/1/01 AUD 3,490,000 3,120,520 ----------------------------------------------------------------------------------------------------------------------------- New Zealand (Republic of) Bonds, 8%, 2/15/01 NZD 2,760,000 1,817,748 ----------------------------------------------------------------------------------------------------------------------------- Ontario, Canada (Province of) Bonds, 8%, 10/17/01 554,000 584,492 ----------------------------------------------------------------------------------------------------------------------------- Poland (Republic of): Disc. Bonds, 6.437%, 10/27/24 (4) 5,250,000 4,935,000 Treasury Bills, Zero Coupon: 21.658%, 10/2/96 (7) PLZ 720,000 251,334 21.466%, 12/4/96 (7) PLZ 2,250,000 759,038 20.371%, 3/19/97 (7) PLZ 800,000 255,785 22.37%, 7/24/96 (7) PLZ 3,000,000 1,088,816 ----------------------------------------------------------------------------------------------------------------------------- Portugal (Republic of) Gtd. Bonds, Obrigicion do tes Medio Prazo, PTE 65,000,000 464,182 11.875%, 2/23/00 ----------------------------------------------------------------------------------------------------------------------------- South Africa (Republic of) Debs., 9.625%, 12/15/99 1,000,000 1,046,250 ----------------------------------------------------------------------------------------------------------------------------- Spain (Kingdom of) Gtd. Bonds, Bonos y Obligacion del Estado, ESP 100,000,000 884,090 12.25%, 3/25/00 ----------------------------------------------------------------------------------------------------------------------------- Sweden (Kingdom of) Bonds, Series 1030, 13%, 6/15/01 SEK 12,600,000 2,321,861 ----------------------------------------------------------------------------------------------------------------------------- United Kingdom Treasury Nts.: 13%, 7/14/00 GBP 1,630,000 3,040,818 7.50%, 12/7/06 GBP 2,000,000 3,020,201 ------------- Total Foreign Government Obligations (Cost $44,880,690) 45,165,964
19 37 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ LOAN PARTICIPATIONS - 0.5% - ------------------------------------------------------------------------------------------------------------------------------------ Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 (Cost $1,457,891) (4)(9) $ 1,571,600 $ 1,465,517 - ------------------------------------------------------------------------------------------------------------------------------------ MUNICIPAL BONDS AND NOTES - 0.6% - ------------------------------------------------------------------------------------------------------------------------------------ Dade County, Florida Educational Facilities Authority: Exchangeable Revenue Bonds, University of Miami, Prerefunded, MBIA Insured, 7.65%, 4/1/10 175,000 196,550 Revenue Bonds, University of Miami, MBIA Insured, 7.65%, 4/1/10 205,000 225,008 Taxable Exchange Revenue Bonds, University of Miami, MBIA Insured, 9.70%, 4/1/10 120,000 131,712 ----------------------------------------------------------------------------------------------------------------------------- Pinole, California Redevelopment Agency Tax Allocation Taxable Bonds, Pinole Vista Redevelopment, Series B, 8.35%, 8/1/17 670,000 675,954 ----------------------------------------------------------------------------------------------------------------------------- Port of Portland, Oregon Special Obligation Taxable Revenue Bonds, PAMCO Project, 9.20%, 5/15/22 500,000 537,055 --------------- Total Municipal Bonds and Notes (Cost $1,663,889) 1,766,279 - ------------------------------------------------------------------------------------------------------------------------------------ CORPORATE BONDS AND NOTES - 16.7% - ------------------------------------------------------------------------------------------------------------------------------------ BASIC INDUSTRY - 2.1% - ------------------------------------------------------------------------------------------------------------------------------------ CHEMICALS - 1.0% ----------------------------------------------------------------------------------------------------------------------------- Lyondell Petrochemical Co., 8.25% Nts., 3/15/97 738,000 748,040 ----------------------------------------------------------------------------------------------------------------------------- Quantum Chemical Corp., 10.375% First Mtg. Nts., 6/1/03 2,100,000 2,305,911 --------------- 3,053,951 - ------------------------------------------------------------------------------------------------------------------------------------ PAPER - 1.1% ----------------------------------------------------------------------------------------------------------------------------- Boise Cascade Corp., 9.90% Nts., 3/15/00 750,000 817,223 ----------------------------------------------------------------------------------------------------------------------------- Noranda Forest, Inc., 11% Debs., 7/15/98 CAD 1,000,000 792,138 ----------------------------------------------------------------------------------------------------------------------------- Potlatch Corp., 9.46% Medium-Term Nts., 4/2/02 369,000 409,524 ----------------------------------------------------------------------------------------------------------------------------- Scotia Pacific Holding Co., 7.95% Timber Collateralized Nts., 7/20/15 1,508,981 1,484,643 --------------- 3,503,528 - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER RELATED - 2.4% - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER PRODUCTS - 0.7% ----------------------------------------------------------------------------------------------------------------------------- Fletcher Challenge Capital Canada, Inc., 7.75% Nts., 6/20/06 1,800,000 1,827,324 ----------------------------------------------------------------------------------------------------------------------------- Procter & Gamble Co., 9.36% Debs., 1/1/21 369,000 441,729 --------------- 2,269,053 - ------------------------------------------------------------------------------------------------------------------------------------ FOOD/BEVERAGES/TOBACCO - 0.4% ----------------------------------------------------------------------------------------------------------------------------- Bass America, Inc., 6.75% Gtd. Nts., 8/1/99 554,000 555,700 ----------------------------------------------------------------------------------------------------------------------------- Philip Morris Cos., Inc., 8.875% Nts., 7/1/96 500,000 500,000 ----------------------------------------------------------------------------------------------------------------------------- Unilever CR spol. s.r.o., guaranteed by Unilever NV, Rotterdam, The Netherlands, Zero Coupon Promissory Nts., 11.189%, 10/11/96 (7) CZK 7,000,000 246,639 --------------- 1,302,339 - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 0.6% ----------------------------------------------------------------------------------------------------------------------------- R.P. Scherer Corp., 6.75% Sr. Nts., 2/1/04 1,250,000 1,195,314
20 38 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE (CONTINUED) ----------------------------------------------------------------------------------------------------------------------------- Roche Holdings, Inc., 2.75% Bonds, 4/14/00 $ 920,000 $ 811,325 --------------- 2,006,639 - ------------------------------------------------------------------------------------------------------------------------------------ HOTEL/GAMING - 0.1% ----------------------------------------------------------------------------------------------------------------------------- Circus Circus Enterprises, Inc., 6.75% Nts., 7/15/03 375,000 363,378 - ------------------------------------------------------------------------------------------------------------------------------------ TEXTILE/APPAREL - 0.3% ----------------------------------------------------------------------------------------------------------------------------- Fruit of the Loom, Inc., 7% Debs., 3/15/11 1,097,000 985,410 - ------------------------------------------------------------------------------------------------------------------------------------ TOYS - 0.3% ----------------------------------------------------------------------------------------------------------------------------- Mattel, Inc., 6.875% Sr. Nts., 8/1/97 1,000,000 1,006,052 - ------------------------------------------------------------------------------------------------------------------------------------ ENERGY - 1.9% - ------------------------------------------------------------------------------------------------------------------------------------ BP America, Inc., 10.875% Nts., 8/1/01 CAD 650,000 540,231 ----------------------------------------------------------------------------------------------------------------------------- Coastal Corp.: 8.75% Sr. Nts., 5/15/99 369,000 388,071 9.75% Sr. Debs., 8/1/03 200,000 225,716 ----------------------------------------------------------------------------------------------------------------------------- Colorado International Gas Corp., 10% Sr. Debs., 6/15/05 369,000 431,634 ----------------------------------------------------------------------------------------------------------------------------- Enron Corp., 9.875% Debs., 6/15/03 375,000 429,130 ----------------------------------------------------------------------------------------------------------------------------- McDermott, Inc., 9.375% Nts., 3/15/02 400,000 426,047 ----------------------------------------------------------------------------------------------------------------------------- Mitchell Energy & Development Corp., 9.25% Sr. Nts., 1/15/02 1,000,000 1,027,077 ----------------------------------------------------------------------------------------------------------------------------- Norsk Hydro AS, 8.75% Bonds, 10/23/01 738,000 784,125 ----------------------------------------------------------------------------------------------------------------------------- Sonat, Inc., 9.50% Nts., 8/15/99 250,000 268,589 ----------------------------------------------------------------------------------------------------------------------------- Southwest Gas Corp., 9.75% Debs., Series F, 6/15/02 500,000 549,655 ----------------------------------------------------------------------------------------------------------------------------- Texaco Capital, Inc., 8.875% Gtd. Debs., 9/1/21 369,000 421,875 ----------------------------------------------------------------------------------------------------------------------------- TransCanada PipeLines Ltd., 9.875% Debs., 1/1/21 554,000 680,090 --------------- 6,172,240 - ------------------------------------------------------------------------------------------------------------------------------------ FINANCIAL SERVICES - 3.7% - ------------------------------------------------------------------------------------------------------------------------------------ BANKS & THRIFTS - 1.1% ----------------------------------------------------------------------------------------------------------------------------- Banco Ganadero SA, 9.75% Sr. Unsub. Unsec. Nts., 8/26/99 (3) 185,000 190,781 ----------------------------------------------------------------------------------------------------------------------------- BankAmerica Corp.: 7.50% Sr. Nts., 3/15/97 100,000 101,060 7.75% Sub. Nts., 7/15/02 554,000 574,663 ----------------------------------------------------------------------------------------------------------------------------- Chase Manhattan Corp. (New), 10.125% Sub. Nts., 11/1/00 554,000 620,844 ----------------------------------------------------------------------------------------------------------------------------- First Chicago Corp.: 11.25% Sub. Nts., 2/20/01 750,000 877,050 9% Sub. Nts., 6/15/99 150,000 159,482 ----------------------------------------------------------------------------------------------------------------------------- First Fidelity Bancorporation, 8.50% Sub. Capital Nts., 4/1/98 654,000 675,462 --------------- 3,199,342 - ------------------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED FINANCIAL - 2.4% ----------------------------------------------------------------------------------------------------------------------------- Allied-Lyons Finance BV, 6.50% Debs., 8/26/97 369,000 368,539 ----------------------------------------------------------------------------------------------------------------------------- American Car Line Co., 8.25% Equipment Trust Certificates, Series 1993-A, 4/15/08 578,000 585,004 ----------------------------------------------------------------------------------------------------------------------------- American General Finance Corp., 5.875% Sr. Nts., 7/1/00 554,000 536,764 ----------------------------------------------------------------------------------------------------------------------------- Associates Corp. of North America, 8.625% Sr. Nts., 6/15/97 369,000 377,618 ----------------------------------------------------------------------------------------------------------------------------- AVCO Financial Services Asia Ltd., 5.875% Sr. Nts., 10/15/97 369,000 367,643 ----------------------------------------------------------------------------------------------------------------------------- Caterpillar Financial Services, Inc., 6.85% Medium-Term Nts., Series 369,000 372,310 D, 9/15/97
21 39 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED FINANCIAL (CONTINUED) ----------------------------------------------------------------------------------------------------------------------------- Chrysler Financial Corp., 6.65% Medium-Term Nts., 4/28/97 $ 369,000 $ 370,506 ----------------------------------------------------------------------------------------------------------------------------- Countrywide Funding Corp., 6.57% Gtd. Medium-Term Nts., Series A, 8/4/97 554,000 556,366 ----------------------------------------------------------------------------------------------------------------------------- Fleet Mtg. Group, Inc., 6.50% Nts., 9/15/99 369,000 366,900 ----------------------------------------------------------------------------------------------------------------------------- General Motors Acceptance Corp., 7.875% Medium-Term Nts., 2/27/97 369,000 373,702 ----------------------------------------------------------------------------------------------------------------------------- Golden West Financial Corp.: 10.25% Sub. Nts., 5/15/97 369,000 381,747 8.625% Sub. Nts., 8/30/98 185,000 192,463 ----------------------------------------------------------------------------------------------------------------------------- Household Finance Corp., 8.95% Debs., 9/15/99 369,000 392,637 ----------------------------------------------------------------------------------------------------------------------------- Household International, BV, 6% Gtd. Sr. Nts., 3/15/99 369,000 362,139 ----------------------------------------------------------------------------------------------------------------------------- Lehman Brothers Holdings, Inc., 8.375% Nts., 2/15/99 700,000 726,461 ----------------------------------------------------------------------------------------------------------------------------- Penske Truck Leasing Co. LP, 7.75% Sr. Nts., 5/15/99 738,000 761,374 ----------------------------------------------------------------------------------------------------------------------------- U.S. Leasing International, 7% Nts., 11/1/97 554,000 559,271 --------------- 7,651,444 - ------------------------------------------------------------------------------------------------------------------------------------ INSURANCE - 0.2% ----------------------------------------------------------------------------------------------------------------------------- SunAmerica, Inc., 9% Sr. Nts., 1/15/99 554,000 581,652 - ------------------------------------------------------------------------------------------------------------------------------------ MANUFACTURING - 0.7% - ------------------------------------------------------------------------------------------------------------------------------------ AEROSPACE/ELECTRONICS/COMPUTERS - 0.2% ----------------------------------------------------------------------------------------------------------------------------- British Aerospace PLC, 8% Debs., 5/27/97 740,000 750,175 - ------------------------------------------------------------------------------------------------------------------------------------ AUTOMOTIVE - 0.5% ----------------------------------------------------------------------------------------------------------------------------- Chrysler Corp., 10.95% Debs., 8/1/17 800,000 876,920 ----------------------------------------------------------------------------------------------------------------------------- General Motors Acceptance Corp., 7.75% Nts., 4/15/97 700,000 708,659 --------------- 1,585,579 - ------------------------------------------------------------------------------------------------------------------------------------ MEDIA - 2.8% - ------------------------------------------------------------------------------------------------------------------------------------ BROADCASTING - 0.2% ----------------------------------------------------------------------------------------------------------------------------- Tele-Communications, Inc., 5.28% Medium-Term Nts., 8/20/96 701,000 700,546 - ------------------------------------------------------------------------------------------------------------------------------------ CABLE TELEVISION - 1.3% ----------------------------------------------------------------------------------------------------------------------------- Time Warner Entertainment LP/Time Warner, Inc., 8.375% Sr. Debs., 3/15/23 1,850,000 1,801,214 ----------------------------------------------------------------------------------------------------------------------------- TKR Cable I, Inc., 10.50% Sr. Debs., 10/30/07 2,200,000 2,449,365 --------------- 4,250,579 - ------------------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED MEDIA - 0.8% ----------------------------------------------------------------------------------------------------------------------------- GSPI Corp., 10.15% First Mtg. Bonds, 6/24/10 (3) 1,142,150 1,286,062 ----------------------------------------------------------------------------------------------------------------------------- News America Holdings, Inc.: 10.125% Sr. Gtd. Debs., 10/15/12 500,000 566,122 12% Sr. Nts., 12/15/01 500,000 541,698 --------------- 2,393,882 - ------------------------------------------------------------------------------------------------------------------------------------ ENTERTAINMENT/FILM - 0.2% ----------------------------------------------------------------------------------------------------------------------------- Columbia Pictures Entertainment, Inc., 9.875% Sr. Sub. Nts., 2/1/98 500,000 525,797 - ------------------------------------------------------------------------------------------------------------------------------------ PUBLISHING/PRINTING - 0.3% ----------------------------------------------------------------------------------------------------------------------------- Reed Elsevier, Inc., 6.625% Nts., 10/15/23 (3) 600,000 519,270 ----------------------------------------------------------------------------------------------------------------------------- Reed Publishing (USA), Inc., 7.24% Gtd. Medium-Term Nts., 2/10/97 500,000 503,640 --------------- 1,022,910
22 40 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------------ OTHER - 0.7% - ------------------------------------------------------------------------------------------------------------------------------------ CONGLOMERATES - 0.6% ----------------------------------------------------------------------------------------------------------------------------- Tenneco, Inc.: 10% Debs., 3/15/08 $ 400,000 $ 472,077 10% Debs., 8/1/98 554,000 590,198 7.875% Nts., 10/1/02 650,000 669,822 --------------- 1,732,097 - ------------------------------------------------------------------------------------------------------------------------------------ SERVICES - 0.1% ----------------------------------------------------------------------------------------------------------------------------- PHH Corp., 6.50% Nts., 2/1/00 369,000 365,606 - ------------------------------------------------------------------------------------------------------------------------------------ RETAIL - 0.2% - ------------------------------------------------------------------------------------------------------------------------------------ DRUG STORES - 0.2% ----------------------------------------------------------------------------------------------------------------------------- Hook-SupeRx, Inc., 10.125% Sr. Nts., 6/1/02 600,000 641,269 - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 0.1% - ------------------------------------------------------------------------------------------------------------------------------------ RAILROADS - 0.1% ----------------------------------------------------------------------------------------------------------------------------- Union Pacific Corp., 9.65% Medium-Term Nts., 4/17/00 400,000 435,511 - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 2.1% - ------------------------------------------------------------------------------------------------------------------------------------ ELECTRIC UTILITIES - 0.7% ----------------------------------------------------------------------------------------------------------------------------- Commonwealth Edison Co., 6.50% Nts., 7/15/97 775,000 773,183 ----------------------------------------------------------------------------------------------------------------------------- HNG Internorth/Enron Corp., 9.625% Debs., 3/15/06 369,000 419,709 ----------------------------------------------------------------------------------------------------------------------------- Long Island Lighting Co., 7% Nts., 3/1/04 150,000 134,636 ----------------------------------------------------------------------------------------------------------------------------- Public Service Co. of Colorado, 8.75% First Mtg. Bonds, 3/1/22 750,000 792,497 --------------- 2,120,025 - ------------------------------------------------------------------------------------------------------------------------------------ TELECOMMUNICATIONS - 1.4% ----------------------------------------------------------------------------------------------------------------------------- 360 Communications Co.: 7.125% Sr. Nts., 3/1/03 1,450,000 1,392,654 7.50% Sr. Nts., 3/1/06 2,000,000 1,900,920 ----------------------------------------------------------------------------------------------------------------------------- GTE Corp.: 8.85% Debs., 3/1/98 554,000 574,946 9.375% Debs., 12/1/00 500,000 546,176 --------------- 4,414,696 --------------- Total Corporate Bonds and Notes (Cost $53,354,901) 53,033,700
SHARES - ------------------------------------------------------------------------------------------------------------------------------------ PREFERRED STOCKS - 0.4% - ------------------------------------------------------------------------------------------------------------------------------------ BankAmerica Corp., 8.375%, Series K (Cost $1,177,404) 45,400 1,157,700 PRINCIPAL AMOUNT(1) - ------------------------------------------------------------------------------------------------------------------------------------ STRUCTURED INSTRUMENTS - 2.0% - ------------------------------------------------------------------------------------------------------------------------------------ ----------------------------------------------------------------------------------------------------------------------------- Bayerische Landesbank Girozentrale, New York Branch, 14% CD Linked Nts., 12/17/96 (indexed to the cross currency rates of Greek Drachma and European Currency Unit) $ 1,000,000 1,001,600 ----------------------------------------------------------------------------------------------------------------------------- Bayerische Landesbank Girozentrale, New York Branch, 5.60% CD Linked Nts., 1/30/97 (indexed to the closing Nikkei 225 Index on 1/23/97, 10 yr. Japanese Yen swap rate & New Zealand Dollar on 1/28/97) NZD 1,508,523 1,119,691
23 41 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ----------------------------------------------------------------------------------------------------------------------------------- STRUCTURED INSTRUMENTS (CONTINUED) - ----------------------------------------------------------------------------------------------------------------------------------- Canadian Imperial Bank of Commerce, New York Branch, 14% CD Linked $ 250,000 $ 245,325 Nts., 11/25/96 (indexed to the cross currency rates of Greek Drachma and European Currency Unit) ---------------------------------------------------------------------------------------------------------------------------- Internationale Nederlanden Bank NV, Prague Branch, Zero Coupon Promissory Nts., 10.488%, 4/28/97 (7) CZK 13,800,000 461,167 ---------------------------------------------------------------------------------------------------------------------------- Internationale Nederlanden (U.S.) Capital Holdings Corp., Zero Coupon Chilean Peso Linked Nts.: 11.813%, 6/23/97 (7) 900,000 797,850 11.738%, 6/24/97 (7) 900,000 797,670 ---------------------------------------------------------------------------------------------------------------------------- Merrill Lynch & Co., Inc. Units, 9.75%, 6/15/99 (representing debt of Chemical Banking Corp., sub. capital nts., and equity of Citicorp, 7.75% preferred, series 22) (9) 1,000,000 1,138,200 ---------------------------------------------------------------------------------------------------------------------------- Swiss Bank Corp., New York Branch, 6.05% CD Linked Nts., 6/20/97 (indexed to the closing Nikkei 225 Index on 1/23/97 5 yr. & 3 mos. Japanese Yen Swap rate & New Zealand Dollar) 800,000 808,120 -------------- Total Structured Instruments (Cost $6,218,844) 6,369,623 - ----------------------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT - 5.9% - ----------------------------------------------------------------------------------------------------------------------------------- Repurchase agreement with Canadian Imperial Bank of Commerce, 5.45%, dated 6/28/96, to be repurchased at $18,908,584 on 7/1/96, collateralized by U.S. Treasury Bonds, 9.125%-11.25%, 2/15/15-5/11/18, with a value of $6,680,920, and U.S. Treasury Nts., 5.25%-8.50%, 1/11/97-11/15/04, with a value of $12,626,048 (Cost $18,900,000) 18,900,000 18,900,000 ---------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $310,870,304) 98.2% 311,908,746 ---------------------------------------------------------------------------------------------------------------------------- OTHER ASSETS NET OF LIABILITIES 1.8 5,708,154 ------------------- -------------- NET ASSETS 100.0% $ 317,616,900 =================== ==============
1. Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: AUD - Australian Dollar IEP - Irish Punt CAD - Canadian Dollar ITL - Italian Lira CZK - Czech Koruna MXP - Mexican Peso DEM - German Deutsche Mark NZD - New Zealand Dollar DKK - Danish Krone PLZ - Polish Zloty ESP - Spanish Peseta PTE - Portuguese Escudo GBP - British Pound Sterling SEK - Swedish Krona 2. Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans. These securities typically decline in price as interest rates decline. Most other fixed- income securities increase in price when interest rates decline. The principal amount of the underlying pool represents the notional amount on which current interest is calculated. The price of these securities is typically more sensitive to changes in prepayment rates than traditional mortgage-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. 24 42 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Statement of Investments (Continued) - -------------------------------------------------------------------------------- 3. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $10,392,770 or 3.27% of the Fund's net assets, at June 30, 1996. 4. Represents the current interest rate for a variable rate security. 5. Principal-Only Strips represent the right to receive the monthly principal payments on an underlying pool of mortgage loans. The value of these securities generally increases as interest rates decline and prepayment rates rise. The price of these securities is typically more volatile than that of coupon-bearing bonds of the same maturity. Interest rates disclosed represent current yields based upon the current cost basis and estimated timing of future cash flows. 6. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows: CONTRACTS
SUBJECT EXPIRATION EXERCISE PREMIUM MARKET VALUE TO CALL DATE PRICE RECEIVED (NOTE 1) ----------------------------------------------------------------------------------------------------------------------------- Call option on Australian Dollar 352,000 7/3/96 1.25 AUD $ 2,675 $ 282 Call option on Czech Koruna 1,190,000 9/6/96 28.357CZK 15,946 29,310 Call option on Mexican Peso 460,000 8/5/96 8.03MXP 12,374 16,374 -------- --------- $ 30,995 $ 45,966 ======== =========
7. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 8. Indexed instrument for which the principal amount and/or interest due at maturity is affected by the relative value of a foreign index. 9. Identifies issues considered to be illiquid - See applicable note of Notes to Financial Statements. See accompanying Notes to Financial Statements. 25 43 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------------- SHORT-TERM NOTES - 2.1% - ---------------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., 5.27%, 7/1/96 (Cost $10,000,000) $10,000,000 $10,000,000 - ---------------------------------------------------------------------------------------------------------------------------------- CONVERTIBLE CORPORATE BONDS AND NOTES - 0.6% - ---------------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------------------- Danka Business Systems PLC, 6.75% Cv. Sub. Nts., 4/1/02 800,000 950,000 -------------------------------------------------------------------------------------------------------------------------- United Waste Systems, Inc., 4.50% Cv. Sub. Nts., 6/1/01 (1) 2,000,000 2,187,500 --------------- Total Convertible Corporate Bonds and Notes (Cost $2,800,000) 3,137,500 SHARES - ---------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS - 81.2% - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- CONSUMER CYCLICALS - 16.9% - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- AUTOS & HOUSING - 1.2% -------------------------------------------------------------------------------------------------------------------------- Alrenco, Inc. (2) 72,000 1,296,000 -------------------------------------------------------------------------------------------------------------------------- ITI Technologies, Inc. (2) 80,000 2,640,000 -------------------------------------------------------------------------------------------------------------------------- NHP, Inc. (2) 100,000 2,062,500 --------------- 5,998,500 - ---------------------------------------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT - 4.9% -------------------------------------------------------------------------------------------------------------------------- Apple South, Inc. 121,100 3,239,425 -------------------------------------------------------------------------------------------------------------------------- Applebee's International, Inc. 75,000 2,409,375 -------------------------------------------------------------------------------------------------------------------------- CKE Restaurants, Inc. 185,000 4,717,500 -------------------------------------------------------------------------------------------------------------------------- Landry's Seafood Restaurants, Inc. (2) 200,000 4,950,000 -------------------------------------------------------------------------------------------------------------------------- Longhorn Steaks, Inc. (2) 78,600 1,965,000 -------------------------------------------------------------------------------------------------------------------------- Quality Dining, Inc. (2) 74,500 2,439,875 -------------------------------------------------------------------------------------------------------------------------- Regal Cinemas, Inc. (2) 56,600 2,589,450 -------------------------------------------------------------------------------------------------------------------------- Studio Plus Hotels, Inc. (2) 50,000 1,650,000 --------------- 23,960,625 - ---------------------------------------------------------------------------------------------------------------------------------- MEDIA - 2.0% -------------------------------------------------------------------------------------------------------------------------- Chancellor Broadcasting Co., Cl. A (2) 58,900 1,840,625 -------------------------------------------------------------------------------------------------------------------------- Evergreen Media Corp., Cl. A (2) 60,000 2,565,000 -------------------------------------------------------------------------------------------------------------------------- Infinity Broadcasting Corp., Cl. A (2) 90,000 2,700,000 -------------------------------------------------------------------------------------------------------------------------- SFX Broadcasting, Inc., Cl. A (2) 63,200 2,464,800 --------------- 9,570,425 - ---------------------------------------------------------------------------------------------------------------------------------- RETAIL: GENERAL - 3.6% -------------------------------------------------------------------------------------------------------------------------- Donna Karan International, Inc. 102,200 2,861,600 -------------------------------------------------------------------------------------------------------------------------- Fila Holding SpA, ADR 40,000 3,450,000 -------------------------------------------------------------------------------------------------------------------------- Nautica Enterprises, Inc. (2) 105,000 3,018,750 -------------------------------------------------------------------------------------------------------------------------- Polymer Group, Inc. (2) 100,000 1,750,000 -------------------------------------------------------------------------------------------------------------------------- Vans, Inc. (2) 201,000 3,417,000 -------------------------------------------------------------------------------------------------------------------------- Wolverine World Wide, Inc. 89,000 2,892,500 --------------- 17,389,850 - ---------------------------------------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY - 5.2% -------------------------------------------------------------------------------------------------------------------------- Boise Cascade Office Products Corp. (2) 100,000 3,462,500 -------------------------------------------------------------------------------------------------------------------------- Copart, Inc. (2) 78,100 1,288,650 -------------------------------------------------------------------------------------------------------------------------- Corporate Express, Inc. (2) 82,500 3,300,000 -------------------------------------------------------------------------------------------------------------------------- General Nutrition Cos., Inc. (2) 62,700 1,097,250 -------------------------------------------------------------------------------------------------------------------------- Gymboree Corp. (2) 75,000 2,287,500
26 44 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------ RETAIL: SPECIALTY (CONTINUED) ---------------------------------------------------------------------------------------------------------------------- Men's Wearhouse, Inc. (The) (2) 100,100 $3,228,225 ---------------------------------------------------------------------------------------------------------------------- Moovies, Inc. (2) 99,600 784,350 ---------------------------------------------------------------------------------------------------------------------- MSC Industrial Direct Co., Inc., Cl. A (2) 35,000 1,128,750 ---------------------------------------------------------------------------------------------------------------------- Petco Animal Supplies, Inc. (2) 120,000 3,450,000 ---------------------------------------------------------------------------------------------------------------------- Staples, Inc. (2) 101,250 1,974,375 ---------------------------------------------------------------------------------------------------------------------- Viking Office Products, Inc. (2) 110,000 3,451,250 ----------- 25,452,850 - ------------------------------------------------------------------------------------------------------------------------------ CONSUMER NON-CYCLICALS - 21.7% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ FOOD - 1.0% ---------------------------------------------------------------------------------------------------------------------- Safeway, Inc. (2) 150,000 4,950,000 - ------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/DRUGS - 8.1% ---------------------------------------------------------------------------------------------------------------------- Agouron Pharmaceuticals, Inc. (2) 40,000 1,560,000 ---------------------------------------------------------------------------------------------------------------------- Alpha-Beta Technology, Inc. (2) 140,000 1,242,500 ---------------------------------------------------------------------------------------------------------------------- Apache Medical Systems, Inc. 100,000 1,225,000 ---------------------------------------------------------------------------------------------------------------------- BioChem Pharma, Inc. (2) 105,000 3,937,500 ---------------------------------------------------------------------------------------------------------------------- CIMA Labs, Inc. (2) 82,500 618,750 ---------------------------------------------------------------------------------------------------------------------- Corvas International, Inc. (2) 112 546 ---------------------------------------------------------------------------------------------------------------------- Dura Pharmaceuticals, Inc. (2) 75,000 4,200,000 ---------------------------------------------------------------------------------------------------------------------- Elan Corp. PLC, ADR (2) 45,000 2,570,625 ---------------------------------------------------------------------------------------------------------------------- Ethical Holdings PLC, Sponsored ADR (2) 50,000 487,500 ---------------------------------------------------------------------------------------------------------------------- Genome Therapeutics Corp. (2) 110,000 990,000 ---------------------------------------------------------------------------------------------------------------------- Genzyme Corp. (2) 50,000 587,500 ---------------------------------------------------------------------------------------------------------------------- Gilead Sciences, Inc. (2) 39,300 992,325 ---------------------------------------------------------------------------------------------------------------------- Guilford Pharmaceuticals, Inc. (2) 63,400 1,505,750 ---------------------------------------------------------------------------------------------------------------------- Incyte Pharmaceuticals, Inc. (2) 40,000 1,542,500 ---------------------------------------------------------------------------------------------------------------------- Integra LifeSciences Corp. (2) 53,000 516,750 ---------------------------------------------------------------------------------------------------------------------- Martek Biosciences Corp. (2) 40,000 1,170,000 ---------------------------------------------------------------------------------------------------------------------- Matrix Pharmaceutical, Inc. (2) 80,400 1,447,200 ---------------------------------------------------------------------------------------------------------------------- Mentor Corp. 60,000 1,530,000 ---------------------------------------------------------------------------------------------------------------------- Millennium Pharmaceuticals, Inc. (2) 70,000 1,085,000 ---------------------------------------------------------------------------------------------------------------------- Nuerocrine Biosciences, Inc. (2) 105,000 931,875 ---------------------------------------------------------------------------------------------------------------------- Physician Support Systems, Inc. (2) 180,000 4,072,500 ---------------------------------------------------------------------------------------------------------------------- Protein Design Labs, Inc. (2) 57,500 1,293,750 ---------------------------------------------------------------------------------------------------------------------- QIAGEN NV 60,000 907,500 ---------------------------------------------------------------------------------------------------------------------- SangStat Medical Corp. (2) 190,000 3,230,000 ---------------------------------------------------------------------------------------------------------------------- Watson Pharmaceuticals, Inc. (2) 35,000 1,325,625 ----------- 38,970,696 - ------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/SUPPLIES & SERVICES - 12.6% ---------------------------------------------------------------------------------------------------------------------- Aksys Ltd. (2) 42,375 646,219 ---------------------------------------------------------------------------------------------------------------------- AmeriSource Health Corp., Cl. A (2) 115,500 3,840,375 ---------------------------------------------------------------------------------------------------------------------- Cardiovascular Dynamics, Inc. (2) 93,700 1,147,825 ---------------------------------------------------------------------------------------------------------------------- Compdent Corp. (2) 40,000 1,860,000 ---------------------------------------------------------------------------------------------------------------------- ESC Medical Systems Ltd. (2) 62,100 1,754,325 ---------------------------------------------------------------------------------------------------------------------- Guidant Corp. 95,000 4,678,750 ---------------------------------------------------------------------------------------------------------------------- Gulf South Medical Supply, Inc. (2) 108,400 4,227,600 ---------------------------------------------------------------------------------------------------------------------- HEALTHSOUTH Corp. (2) 135,000 4,860,000 ---------------------------------------------------------------------------------------------------------------------- Hologic, Inc. (2) 50,000 2,212,500 ---------------------------------------------------------------------------------------------------------------------- Impath, Inc. (2) 100,000 1,800,000
27 45 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/SUPPLIES & SERVICES (CONTINUED) ---------------------------------------------------------------------------------------------------------------------- Integ, Inc. 150,000 $1,443,750 ---------------------------------------------------------------------------------------------------------------------- Mariner Health Group, Inc. (2) 100,000 1,837,500 ---------------------------------------------------------------------------------------------------------------------- National Surgery Centers, Inc. (2) 21,750 576,375 ---------------------------------------------------------------------------------------------------------------------- Novoste Corp. (2) 150,000 1,481,250 ---------------------------------------------------------------------------------------------------------------------- OccuSystems, Inc. (2) 45,000 1,681,875 ---------------------------------------------------------------------------------------------------------------------- Omnicare, Inc. 153,600 4,070,400 ---------------------------------------------------------------------------------------------------------------------- Pediatrix Medical Group, Inc. (2) 85,000 4,122,500 ---------------------------------------------------------------------------------------------------------------------- PhyCor, Inc. (2) 127,500 4,845,000 ---------------------------------------------------------------------------------------------------------------------- Physician Reliance Network, Inc. (2) 100,000 2,225,000 ---------------------------------------------------------------------------------------------------------------------- Physicians Resource Group, Inc. (2) 139,000 4,639,125 ---------------------------------------------------------------------------------------------------------------------- Renal Treatment Centers, Inc. (2) 125,000 3,593,750 ---------------------------------------------------------------------------------------------------------------------- Total Renal Care Holdings, Inc. (2) 87,600 3,701,100 ----------- 61,245,219 - ------------------------------------------------------------------------------------------------------------------------------ ENERGY - 2.7% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ ENERGY SERVICES & PRODUCERS - 2.7% ---------------------------------------------------------------------------------------------------------------------- Diamond Offshore Drilling, Inc. (2) 86,900 4,975,025 ---------------------------------------------------------------------------------------------------------------------- Energy Ventures, Inc. (2) 100,200 3,256,500 ---------------------------------------------------------------------------------------------------------------------- Nabors Industries, Inc. (2) 150,000 2,437,500 ---------------------------------------------------------------------------------------------------------------------- NUMAR Corp. (2) 51,000 777,750 ---------------------------------------------------------------------------------------------------------------------- Weatherford Enterra, Inc. (2) 50,000 1,500,000 ----------- 12,946,775 - ------------------------------------------------------------------------------------------------------------------------------ FINANCIAL - 2.5% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED FINANCIAL - 1.2% ---------------------------------------------------------------------------------------------------------------------- Advanta Corp., Cl. B 40,000 1,810,000 ---------------------------------------------------------------------------------------------------------------------- Associates First Capital Corp., Cl. A (2) 56,000 2,107,000 ---------------------------------------------------------------------------------------------------------------------- Green Tree Financial Corp. 60,000 1,875,000 ----------- 5,792,000 - ------------------------------------------------------------------------------------------------------------------------------ INSURANCE - 1.3% ---------------------------------------------------------------------------------------------------------------------- Berkley (W.R.) Corp. 50,000 2,087,500 ---------------------------------------------------------------------------------------------------------------------- CapMAC Holdings, Inc. 85,600 2,439,600 ---------------------------------------------------------------------------------------------------------------------- Executive Risk, Inc. 50,000 1,912,500 ----------- 6,439,600 - ------------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL - 11.2% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ ELECTRICAL EQUIPMENT - 0.4% ---------------------------------------------------------------------------------------------------------------------- Honeywell, Inc. 40,000 2,180,000 - ------------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL MATERIALS - 0.5% ---------------------------------------------------------------------------------------------------------------------- BMC West Corp. (2) 128,000 2,192,000 - ------------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL SERVICES - 9.3% ---------------------------------------------------------------------------------------------------------------------- Affiliated Computer Services, Inc., Cl. A (2) 48,000 2,256,000 ---------------------------------------------------------------------------------------------------------------------- CIBER, Inc. (2) 133,000 2,926,000 ---------------------------------------------------------------------------------------------------------------------- Computer Horizons Corp. (2) 62,500 2,468,750 ---------------------------------------------------------------------------------------------------------------------- CORT Business Services Corp. (2) 93,800 1,829,100 ---------------------------------------------------------------------------------------------------------------------- Danka Business Systems PLC, Sponsored ADR 70,000 2,047,500 ---------------------------------------------------------------------------------------------------------------------- DecisionOne Holdings Corp. (2) 90,000 2,137,500 ---------------------------------------------------------------------------------------------------------------------- First USA Paymentech, Inc. (2) 88,100 3,524,000 ---------------------------------------------------------------------------------------------------------------------- Greenwich Air Services, Inc., B Shares (2) 125,000 2,437,500 ---------------------------------------------------------------------------------------------------------------------- Kent Electronics Corp. (2) 56,600 1,768,750 ---------------------------------------------------------------------------------------------------------------------- May & Speh, Inc. (2) 74,900 1,179,675
28 46 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL SERVICES (CONTINUED) ------------------------------------------------------------------------------------------------------------------------ NOVA Corp. (2) 10,800 $364,500 ------------------------------------------------------------------------------------------------------------------------ PMT Services, Inc. (2) 76,500 2,189,812 ------------------------------------------------------------------------------------------------------------------------ SITEL Corp. (2) 118,600 4,981,200 ------------------------------------------------------------------------------------------------------------------------ Transaction Network Services, Inc. (2) 92,500 1,988,750 ------------------------------------------------------------------------------------------------------------------------ Transaction Systems Architects, Inc., Cl. A (2) 46,000 3,082,000 ------------------------------------------------------------------------------------------------------------------------ United Waste Systems, Inc. (2) 74,000 2,386,500 ------------------------------------------------------------------------------------------------------------------------ USA Waste Services, Inc. (2) 171,300 5,074,762 ------------------------------------------------------------------------------------------------------------------------ Walsh International, Inc. (2) 130,000 1,202,500 ------------------------------------------------------------------------------------------------------------------------ Whittman-Hart, Inc. (2) 42,300 1,522,800 ------------- 45,367,599 - -------------------------------------------------------------------------------------------------------------------------------- MANUFACTURING - 0.5% ------------------------------------------------------------------------------------------------------------------------ U.S. Filter Corp. (2) 75,000 2,606,250 - -------------------------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 0.5% ------------------------------------------------------------------------------------------------------------------------ Airborne Freight Corp. 100,000 2,600,000 - -------------------------------------------------------------------------------------------------------------------------------- TECHNOLOGY - 25.8% - -------------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------------- COMPUTER HARDWARE - 0.6% ------------------------------------------------------------------------------------------------------------------------ Encad, Inc. (2) 160,000 2,720,000 - -------------------------------------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE - 12.1% ------------------------------------------------------------------------------------------------------------------------ Adept Technology, Inc. 137,700 1,927,800 ------------------------------------------------------------------------------------------------------------------------ America Online, Inc. 40,000 1,750,000 ------------------------------------------------------------------------------------------------------------------------ Aspen Technologies, Inc. (2) 70,000 3,850,000 ------------------------------------------------------------------------------------------------------------------------ Business Objects SA, Sponsored ADR (2) 70,000 2,817,500 ------------------------------------------------------------------------------------------------------------------------ Centennial Technologies, Inc. (2) 90,000 2,688,750 ------------------------------------------------------------------------------------------------------------------------ Cylink Corp. (2) 10,000 172,500 ------------------------------------------------------------------------------------------------------------------------ Enterprise Systems, Inc. (2) 104,100 2,862,750 ------------------------------------------------------------------------------------------------------------------------ FileNet Corp. (2) 60,000 2,190,000 ------------------------------------------------------------------------------------------------------------------------ First Data Corp. 78,788 6,273,495 ------------------------------------------------------------------------------------------------------------------------ HBO & Co. 70,000 4,742,500 ------------------------------------------------------------------------------------------------------------------------ Health Systems Design Corp. (2) 71,000 1,047,250 ------------------------------------------------------------------------------------------------------------------------ IMNET Systems, Inc. (2) 106,300 3,242,150 ------------------------------------------------------------------------------------------------------------------------ Indus Group, Inc. (The) (2) 75,000 1,518,750 ------------------------------------------------------------------------------------------------------------------------ Legato Systems, Inc. (2) 20,000 1,100,000 ------------------------------------------------------------------------------------------------------------------------ Mecon, Inc. (2) 95,000 2,149,375 ------------------------------------------------------------------------------------------------------------------------ Open Text Corp. (2) 65,000 674,375 ------------------------------------------------------------------------------------------------------------------------ Oracle Corp. (2) 97,500 3,845,156 ------------------------------------------------------------------------------------------------------------------------ PowerCerv Corp. (2) 70,000 857,500 ------------------------------------------------------------------------------------------------------------------------ Project Software & Development, Inc. (2) 49,500 2,320,313 ------------------------------------------------------------------------------------------------------------------------ Rational Software Corp. (2) 25,000 1,343,750 ------------------------------------------------------------------------------------------------------------------------ Software 2000, Inc. (2) 121,800 1,964,025 ------------------------------------------------------------------------------------------------------------------------ Summit Medical Systems, Inc. (2) 55,000 1,072,500 ------------------------------------------------------------------------------------------------------------------------ Sunquest Information Systems, Inc. (2) 110,000 1,650,000 ------------------------------------------------------------------------------------------------------------------------ Transition Systems, Inc. (2) 100,000 2,850,000 ------------------------------------------------------------------------------------------------------------------------ Vantive Corp. (2) 35,000 1,172,500 ------------------------------------------------------------------------------------------------------------------------ Verilink Corp. (2) 120,000 3,060,000 ------------- 59,142,939 - -------------------------------------------------------------------------------------------------------------------------------- ELECTRONICS - 2.0% ------------------------------------------------------------------------------------------------------------------------ Affinity Technology Group, Inc. (2) 54,700 464,950 ------------------------------------------------------------------------------------------------------------------------ Itron, Inc. (2) 75,000 2,128,125
29 47 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- ELECTRONICS (CONTINUED) ------------------------------------------------------------------------------------------------------------------------ Sawtek, Inc. (2) 95,100 $3,280,950 ------------------------------------------------------------------------------------------------------------------------ SDL, Inc. (2) 135,000 3,746,250 ----------- 9,620,275 - -------------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 11.1% ------------------------------------------------------------------------------------------------------------------------ Arch Communications Group, Inc. (2) 100,000 1,862,500 ------------------------------------------------------------------------------------------------------------------------ Cisco Systems, Inc. (2) 50,000 2,831,250 ------------------------------------------------------------------------------------------------------------------------ Comverse Technology, Inc. (2) 150,000 4,575,000 ------------------------------------------------------------------------------------------------------------------------ Davox Corp. (2) 60,000 1,770,000 ------------------------------------------------------------------------------------------------------------------------ Glenayre Technologies, Inc. 122,625 6,131,250 ------------------------------------------------------------------------------------------------------------------------ LCI International, Inc. (2) 132,600 4,160,325 ------------------------------------------------------------------------------------------------------------------------ MobileMedia Corp., Cl. A (2) 125,000 1,515,625 ------------------------------------------------------------------------------------------------------------------------ Newbridge Networks Corp. (2) 105,000 6,877,500 ------------------------------------------------------------------------------------------------------------------------ Octel Communications Corp. (2) 100,000 1,975,000 ------------------------------------------------------------------------------------------------------------------------ PageMart Wireless, Inc., Cl. A (2) 103,100 1,031,000 ------------------------------------------------------------------------------------------------------------------------ Pairgain Technologies, Inc. (2) 54,800 3,397,600 ------------------------------------------------------------------------------------------------------------------------ Periphonics Corp. (2) 100,400 3,413,600 ------------------------------------------------------------------------------------------------------------------------ ProNet, Inc. (2) 50,000 612,500 ------------------------------------------------------------------------------------------------------------------------ Scientific-Atlanta, Inc. 80,000 1,240,000 ------------------------------------------------------------------------------------------------------------------------ Sterling Commerce, Inc. (2) 45,500 1,689,188 ------------------------------------------------------------------------------------------------------------------------ Tel-Save Holdings, Inc. (2) 100,000 2,125,000 ------------------------------------------------------------------------------------------------------------------------ Tellabs, Inc. (2) 75,000 5,015,625 ------------------------------------------------------------------------------------------------------------------------ Teltrend, Inc. (2) 100,000 3,875,000 ----------- 54,097,963 - -------------------------------------------------------------------------------------------------------------------------------- UTILITIES - 0.4% - -------------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------------- TELEPHONE UTILITIES - 0.4% ------------------------------------------------------------------------------------------------------------------------ ACC Corp., Cl. A (2) 38,800 1,886,650 ------------ Total Common Stocks (Cost $290,205,869) 395,130,216
UNITS - -------------------------------------------------------------------------------------------------------------------------------- RIGHTS, WARRANTS AND CERTIFICATES - 0.0% - -------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------ Windmere Corp. Wts., Exp. 1/98 (Cost $0) 381 -- DATE STRIKE CONTRACTS - -------------------------------------------------------------------------------------------------------------------------------- PUT OPTIONS PURCHASED - 0.1% - -------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------ NASDAQ 100 Index Put. Opt. (Cost $619,650) 9/96 $630 300 371,250 PRINCIPAL AMOUNT - -------------------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT - 18.0% - -------------------------------------------------------------------------------------------------------------------------------- Repurchase agreement with J. P. Morgan Securities, Inc., 5.45%, dated 6/28/96, to be repurchased at $87,839,876 on 7/1/96, collateralized by U.S. Treasury Bonds, 11.25%, 2/15/15, with a value of $81,980,431, and U.S. Treasury Nts., 8.50%, 5/15/97, with a value of $8,245,866 (Cost $87,800,000) $87,800,000 87,800,000
30 48 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Statement of Investments (Continued)
MARKET VALUE (NOTE 1) --------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $391,425,519) 102.0% $496,438,966 --------------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (2.0) (9,566,784) -------- ------------- NET ASSETS 100.0% $486,872,182 ======== =============
1. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $2,187,500 or 0.45% of the Fund's net assets, at June 30, 1996. 2. Non-income producing security. See accompanying Notes to Financial Statements. 31 49 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------ SHORT-TERM NOTES - 7.8% - ------------------------------------------------------------------------------------------------------------------------ Federal Home Loan Mortgage Corp., 5.27%, 7/1/96 (Cost $11,250,000) $11,250,000 $11,250,000 SHARES - ------------------------------------------------------------------------------------------------------------------------ COMMON STOCKS - 80.2% - ------------------------------------------------------------------------------------------------------------------------ BASIC MATERIALS - 4.8% - ------------------------------------------------------------------------------------------------------------------------ CHEMICALS - 3.9% ---------------------------------------------------------------------------------------------------------------- FMC Corp. (1) 8,200 535,050 ---------------------------------------------------------------------------------------------------------------- IMC Global, Inc. 19,000 714,875 ---------------------------------------------------------------------------------------------------------------- Morton International, Inc. 29,000 1,080,250 ---------------------------------------------------------------------------------------------------------------- PPG Industries, Inc. 3,200 156,000 ---------------------------------------------------------------------------------------------------------------- Praxair, Inc. 31,600 1,335,100 ---------------------------------------------------------------------------------------------------------------- Sterling Chemicals, Inc. (1) 31,600 367,350 ---------------------------------------------------------------------------------------------------------------- Terra Industries, Inc. 51,000 631,125 ---------------------------------------------------------------------------------------------------------------- Union Carbide Corp. 19,000 755,250 ----------- 5,575,000 - ------------------------------------------------------------------------------------------------------------------------ PAPER - 0.9% ---------------------------------------------------------------------------------------------------------------- Boise Cascade Corp. 12,000 439,500 ---------------------------------------------------------------------------------------------------------------- Bowater, Inc. 14,000 526,750 ---------------------------------------------------------------------------------------------------------------- Willamette Industries, Inc. 6,000 357,000 ----------- 1,323,250 - ------------------------------------------------------------------------------------------------------------------------ CONSUMER CYCLICALS - 12.2% - ------------------------------------------------------------------------------------------------------------------------ AUTOS & HOUSING - 1.2% ---------------------------------------------------------------------------------------------------------------- AutoZone, Inc. (1) 12,000 417,000 ---------------------------------------------------------------------------------------------------------------- Pulte Corp. 22,000 588,500 ---------------------------------------------------------------------------------------------------------------- Toll Brothers, Inc. (1) 46,000 753,250 ----------- 1,758,750 - ------------------------------------------------------------------------------------------------------------------------ LEISURE & ENTERTAINMENT - 4.4% ---------------------------------------------------------------------------------------------------------------- Alaska Air Group, Inc. (1) 25,000 684,375 ---------------------------------------------------------------------------------------------------------------- AMR Corp. 5,000 455,000 ---------------------------------------------------------------------------------------------------------------- Callaway Golf Co. 25,000 831,250 ---------------------------------------------------------------------------------------------------------------- Delta Air Lines, Inc. 8,000 664,000 ---------------------------------------------------------------------------------------------------------------- Disney (Walt) Co. 25,000 1,571,875 ---------------------------------------------------------------------------------------------------------------- ITT Corp. (New) (1) 5,000 331,250 ---------------------------------------------------------------------------------------------------------------- McDonald's Corp. 11,000 514,250 ---------------------------------------------------------------------------------------------------------------- Outback Steakhouse, Inc. (1) 20,000 689,687 ---------------------------------------------------------------------------------------------------------------- Wendy's International, Inc. 35,800 666,775 ----------- 6,408,462 - ------------------------------------------------------------------------------------------------------------------------ MEDIA - 0.1% ---------------------------------------------------------------------------------------------------------------- Viacom, Inc., Cl. B (1) 3,667 142,555 - ------------------------------------------------------------------------------------------------------------------------ RETAIL: GENERAL - 4.2% ---------------------------------------------------------------------------------------------------------------- Donna Karan International, Inc. 40,100 1,122,800 ---------------------------------------------------------------------------------------------------------------- Eckerd Corp. (1) 44,000 995,500 ---------------------------------------------------------------------------------------------------------------- Jones Apparel Group, Inc. (1) 19,100 938,287 ---------------------------------------------------------------------------------------------------------------- Liz Claiborne, Inc. 11,000 380,875 ---------------------------------------------------------------------------------------------------------------- Nautica Enterprises, Inc. (1) 20,000 575,000 ---------------------------------------------------------------------------------------------------------------- Tommy Hilfiger Corp. (1) 20,800 1,115,400
32 50 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------ RETAIL: GENERAL (CONTINUED) ---------------------------------------------------------------------------------------------------------------- Wal-Mart Stores, Inc. 37,000 $ 938,875 ----------- 6,066,737 - ------------------------------------------------------------------------------------------------------------------------ RETAIL: SPECIALTY - 2.3% ---------------------------------------------------------------------------------------------------------------- Bed Bath & Beyond, Inc. (1) 18,000 481,500 ---------------------------------------------------------------------------------------------------------------- Gap, Inc. (The) 20,000 642,500 ---------------------------------------------------------------------------------------------------------------- General Nutrition Cos., Inc. (1) 18,400 322,000 ---------------------------------------------------------------------------------------------------------------- Home Depot, Inc. 22,000 1,188,000 ---------------------------------------------------------------------------------------------------------------- Lands' End, Inc. (1) 28,000 693,000 ----------- 3,327,000 - ------------------------------------------------------------------------------------------------------------------------ CONSUMER NON-CYCLICALS - 17.0% - ------------------------------------------------------------------------------------------------------------------------ BEVERAGES - 1.5% ---------------------------------------------------------------------------------------------------------------- Boston Beer Co., Inc., Cl. A (1) 13,000 312,000 ---------------------------------------------------------------------------------------------------------------- Coca-Cola Co. (The) 22,000 1,075,250 ---------------------------------------------------------------------------------------------------------------- PepsiCo, Inc. 20,000 707,500 ---------------------------------------------------------------------------------------------------------------- Whitman Corp. 5,000 120,625 ----------- 2,215,375 - ------------------------------------------------------------------------------------------------------------------------ FOOD - 2.7% ---------------------------------------------------------------------------------------------------------------- Casey's General Stores, Inc. 13,000 258,375 ---------------------------------------------------------------------------------------------------------------- H.J. Heinz Co. 15,000 455,625 ---------------------------------------------------------------------------------------------------------------- JP Foodservice, Inc. (1) 25,600 640,000 ---------------------------------------------------------------------------------------------------------------- Kroger Co. (1) 25,000 987,500 ---------------------------------------------------------------------------------------------------------------- Richfood Holdings, Inc. 16,000 520,000 ---------------------------------------------------------------------------------------------------------------- Safeway, Inc. (1) 32,000 1,056,000 ----------- 3,917,500 - ------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/DRUGS - 4.6% ---------------------------------------------------------------------------------------------------------------- Abbott Laboratories 17,000 739,500 ---------------------------------------------------------------------------------------------------------------- Amgen, Inc. (1) 8,000 432,000 ---------------------------------------------------------------------------------------------------------------- Bristol-Myers Squibb Co. 6,500 585,000 ---------------------------------------------------------------------------------------------------------------- Johnson & Johnson 28,516 1,411,542 ---------------------------------------------------------------------------------------------------------------- Pfizer, Inc. 26,500 1,891,437 ---------------------------------------------------------------------------------------------------------------- Schering-Plough Corp. 16,000 1,004,000 ---------------------------------------------------------------------------------------------------------------- Warner-Lambert Co. 10,000 550,000 ----------- 6,613,479 - ------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/SUPPLIES & SERVICES - 5.4% ---------------------------------------------------------------------------------------------------------------- Boston Scientific Corp. (1) 21,000 945,000 ---------------------------------------------------------------------------------------------------------------- Columbia/HCA Healthcare Corp. 8,000 427,000 ---------------------------------------------------------------------------------------------------------------- HealthCare COMPARE Corp. (1) 20,000 975,000 ---------------------------------------------------------------------------------------------------------------- HEALTHSOUTH Corp. (1) 17,000 612,000 ---------------------------------------------------------------------------------------------------------------- Lincare Holdings, Inc. (1) 21,000 824,250 ---------------------------------------------------------------------------------------------------------------- Medtronic, Inc. 26,000 1,456,000 ---------------------------------------------------------------------------------------------------------------- Nellcor Puritan Bennett, Inc. (1) 15,800 766,300 ---------------------------------------------------------------------------------------------------------------- Oxford Health Plans, Inc. (1) 16,000 658,000 ---------------------------------------------------------------------------------------------------------------- Sofamor Danek Group, Inc. (1) 17,000 471,750 ---------------------------------------------------------------------------------------------------------------- Ventritex, Inc. (1) 18,000 308,250 ---------------------------------------------------------------------------------------------------------------- VISX, Inc. (1) 11,000 375,375 ----------- 7,818,925 - ------------------------------------------------------------------------------------------------------------------------ HOUSEHOLD GOODS - 0.7% ---------------------------------------------------------------------------------------------------------------- Procter & Gamble Co. 11,000 996,875
33 51 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------ TOBACCO - 2.1% ---------------------------------------------------------------------------------------------------------------- Philip Morris Cos., Inc. 15,000 $ 1,560,000 ---------------------------------------------------------------------------------------------------------------- UST, Inc. 41,000 1,404,250 ----------- 2,964,250 - ------------------------------------------------------------------------------------------------------------------------ ENERGY - 1.7% - ------------------------------------------------------------------------------------------------------------------------ ENERGY SERVICES & PRODUCERS - 0.9% ---------------------------------------------------------------------------------------------------------------- Global Marine, Inc. (1) 27,000 374,625 ---------------------------------------------------------------------------------------------------------------- Sonat Offshore Drilling, Inc. 18,000 909,000 ----------- 1,283,625 - ------------------------------------------------------------------------------------------------------------------------ OIL-INTEGRATED - 0.8% ---------------------------------------------------------------------------------------------------------------- Mobil Corp. 6,000 672,750 ---------------------------------------------------------------------------------------------------------------- Royal Dutch Petroleum Co. 3,500 538,125 ----------- 1,210,875 - ------------------------------------------------------------------------------------------------------------------------ FINANCIAL - 15.9% - ------------------------------------------------------------------------------------------------------------------------ BANKS - 4.2% ---------------------------------------------------------------------------------------------------------------- Bank of Boston Corp. 23,000 1,138,500 ---------------------------------------------------------------------------------------------------------------- BankAmerica Corp. 7,500 568,125 ---------------------------------------------------------------------------------------------------------------- Chase Manhattan Corp. (New) 15,240 1,076,325 ---------------------------------------------------------------------------------------------------------------- NationsBank Corp. 10,000 826,250 ---------------------------------------------------------------------------------------------------------------- PNC Bank Corp. 24,600 731,850 ---------------------------------------------------------------------------------------------------------------- State Street Boston Corp. 18,600 948,600 ---------------------------------------------------------------------------------------------------------------- Wells Fargo & Co. 3,166 756,278 ----------- 6,045,928 - ------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED FINANCIAL - 8.5% ---------------------------------------------------------------------------------------------------------------- Advanta Corp., Cl. A 15,000 765,000 ---------------------------------------------------------------------------------------------------------------- Associates First Capital Corp., Cl. A (1) 15,000 564,375 ---------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp. 8,000 684,000 ---------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn. 32,000 1,072,000 ---------------------------------------------------------------------------------------------------------------- First USA, Inc. 25,000 1,375,000 ---------------------------------------------------------------------------------------------------------------- Franklin Resources, Inc. 23,000 1,403,000 ---------------------------------------------------------------------------------------------------------------- Green Tree Financial Corp. 56,000 1,750,000 ---------------------------------------------------------------------------------------------------------------- Price (T. Rowe) Associates 43,200 1,328,400 ---------------------------------------------------------------------------------------------------------------- Salomon, Inc. 18,000 792,000 ---------------------------------------------------------------------------------------------------------------- Schwab (Charles) Corp. (New) 29,000 710,500 ---------------------------------------------------------------------------------------------------------------- Travelers Group, Inc. 40,500 1,847,812 ----------- 12,292,087 - ------------------------------------------------------------------------------------------------------------------------ INSURANCE - 3.2% ---------------------------------------------------------------------------------------------------------------- Allstate Corp. 20,000 912,500 ---------------------------------------------------------------------------------------------------------------- Amerin Corp. (1) 18,500 494,875 ---------------------------------------------------------------------------------------------------------------- ITT Hartford Group, Inc. 5,000 266,250 ---------------------------------------------------------------------------------------------------------------- Loews Corp. 11,000 867,625 ---------------------------------------------------------------------------------------------------------------- MGIC Investment Corp. 14,100 791,363 ---------------------------------------------------------------------------------------------------------------- SunAmerica, Inc. 24,000 1,356,000 ----------- 4,688,613 - ------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL - 6.7% - ------------------------------------------------------------------------------------------------------------------------ ELECTRICAL EQUIPMENT - 1.8% ---------------------------------------------------------------------------------------------------------------- Emerson Electric Co. 16,500 1,491,188 ---------------------------------------------------------------------------------------------------------------- General Electric Co. 9,000 778,500
34 52 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------ ELECTRICAL EQUIPMENT (CONTINUED) ---------------------------------------------------------------------------------------------------------------- Kemet Corp. (1) 20,000 400,000 ----------- 2,669,688 - ------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL MATERIALS - 1.5% ---------------------------------------------------------------------------------------------------------------- Centex Corp. 21,000 653,625 ---------------------------------------------------------------------------------------------------------------- Fluor Corp. 6,000 392,250 ---------------------------------------------------------------------------------------------------------------- Rayonier, Inc. 23,400 889,200 ---------------------------------------------------------------------------------------------------------------- Wolverine Tube, Inc. (1) 5,000 175,000 ----------- 2,110,075 - ------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL SERVICES - 1.0% ---------------------------------------------------------------------------------------------------------------- Danka Business Systems PLC, Sponsored ADR 13,000 380,250 ---------------------------------------------------------------------------------------------------------------- DecisionOne Holdings Corp. (1) 23,600 560,500 ---------------------------------------------------------------------------------------------------------------- Manpower, Inc. 12,500 490,625 ----------- 1,431,375 - ------------------------------------------------------------------------------------------------------------------------ MANUFACTURING - 0.8% ---------------------------------------------------------------------------------------------------------------- AGCO Corp. 19,200 532,800 ---------------------------------------------------------------------------------------------------------------- ITT Industries, Inc. 3,000 75,375 ---------------------------------------------------------------------------------------------------------------- Kulicke & Soffa Industries, Inc. (1) 33,000 482,625 ----------- 1,090,800 - ------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 1.6% ---------------------------------------------------------------------------------------------------------------- Burlington Northern Santa Fe Corp. 7,000 566,125 ---------------------------------------------------------------------------------------------------------------- Canadian Pacific Ltd. 62,000 1,364,000 ---------------------------------------------------------------------------------------------------------------- Illinois Central Corp. 15,000 425,625 ----------- 2,355,750 - ------------------------------------------------------------------------------------------------------------------------ TECHNOLOGY - 21.3% - ------------------------------------------------------------------------------------------------------------------------ AEROSPACE/DEFENSE - 0.6% ---------------------------------------------------------------------------------------------------------------- Goodrich (B.F.) Co. 24,000 897,000 - ------------------------------------------------------------------------------------------------------------------------ COMPUTER HARDWARE - 3.4% ---------------------------------------------------------------------------------------------------------------- Adaptec, Inc. (1) 12,000 568,500 ---------------------------------------------------------------------------------------------------------------- Cabletron Systems, Inc. (1) 15,000 1,029,375 ---------------------------------------------------------------------------------------------------------------- Compaq Computer Corp. (1) 16,000 788,000 ---------------------------------------------------------------------------------------------------------------- EMC Corp. (1) 36,000 670,500 ---------------------------------------------------------------------------------------------------------------- Gateway 2000, Inc. (1) 30,800 1,047,200 ---------------------------------------------------------------------------------------------------------------- Seagate Technology, Inc. (1) 19,000 855,000 ----------- 4,958,575 - ------------------------------------------------------------------------------------------------------------------------ COMPUTER SOFTWARE - 9.1% ---------------------------------------------------------------------------------------------------------------- Automatic Data Processing, Inc. 20,000 772,500 ---------------------------------------------------------------------------------------------------------------- BMC Software, Inc. (1) 22,000 1,314,500 ---------------------------------------------------------------------------------------------------------------- Computer Associates International, Inc. 6,000 427,500 ---------------------------------------------------------------------------------------------------------------- First Data Corp. 29,000 2,309,125 ---------------------------------------------------------------------------------------------------------------- Informix Corp. (1) 35,000 787,500 ---------------------------------------------------------------------------------------------------------------- Microsoft Corp. (1) 33,000 3,964,125 ---------------------------------------------------------------------------------------------------------------- Oracle Corp. (1) 45,400 1,790,463 ---------------------------------------------------------------------------------------------------------------- PLATINUM Technology, Inc. (1) 33,000 499,125 ---------------------------------------------------------------------------------------------------------------- Sterling Software, Inc. (1) 11,000 847,000 ---------------------------------------------------------------------------------------------------------------- System Software Associates, Inc. 27,500 467,500 ----------- 13,179,338 - ------------------------------------------------------------------------------------------------------------------------ ELECTRONICS - 3.9% ---------------------------------------------------------------------------------------------------------------- Applied Materials, Inc. (1) 32,000 976,000
35 53 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------ ELECTRONICS (CONTINUED) ---------------------------------------------------------------------------------------------------------------- Arrow Electronics, Inc. (1) 8,000 $ 345,000 ---------------------------------------------------------------------------------------------------------------- Cypress Semiconductor Corp. (1) 55,000 660,000 ---------------------------------------------------------------------------------------------------------------- Intel Corp. 26,000 1,909,375 ---------------------------------------------------------------------------------------------------------------- LSI Logic Corp. (1) 16,000 416,000 ---------------------------------------------------------------------------------------------------------------- Motorola, Inc. 10,000 628,750 ---------------------------------------------------------------------------------------------------------------- Novellus Systems, Inc. (1) 8,200 295,200 ---------------------------------------------------------------------------------------------------------------- Philips Electronics NV, ADR 11,000 358,875 ---------------------------------------------------------------------------------------------------------------- Tegal Corp. (1) 15,000 108,750 ----------- 5,697,950 - ------------------------------------------------------------------------------------------------------------------------ TELECOMMUNICATIONS-TECHNOLOGY - 4.3% ---------------------------------------------------------------------------------------------------------------- 3Com Corp. (1) 3,000 137,250 ---------------------------------------------------------------------------------------------------------------- Cisco Systems, Inc. (1) 23,000 1,302,375 ---------------------------------------------------------------------------------------------------------------- Hong Kong Telecommunications Ltd., Sponsored ADR 21,000 378,000 ---------------------------------------------------------------------------------------------------------------- L.M. Ericsson Telephone Co., Cl. B, ADR 42,000 903,000 ---------------------------------------------------------------------------------------------------------------- Lucent Technologies, Inc. 6,200 234,825 ---------------------------------------------------------------------------------------------------------------- Newbridge Networks Corp. (1) 23,000 1,506,500 ---------------------------------------------------------------------------------------------------------------- Telecom Corp. of New Zealand Ltd., Sponsored ADR 7,000 467,250 ---------------------------------------------------------------------------------------------------------------- Tellabs, Inc. (1) 19,800 1,324,125 ----------- 6,253,325 - ------------------------------------------------------------------------------------------------------------------------ UTILITIES - 0.6% - ------------------------------------------------------------------------------------------------------------------------ TELEPHONE UTILITIES - 0.6% ---------------------------------------------------------------------------------------------------------------- BellSouth Corp. 3,000 127,125 ---------------------------------------------------------------------------------------------------------------- Cincinnati Bell, Inc. 13,800 719,325 ----------- 846,450 ----------- Total Common Stocks (Cost $85,487,962) 116,139,612 PRINCIPAL AMOUNT - ------------------------------------------------------------------------------------------------------------------------ REPURCHASE AGREEMENT - 12.0% - ------------------------------------------------------------------------------------------------------------------------ Repurchase agreement with Canadian Imperial Bank of Commerce, 5.45%, dated 6/28/96, to be repurchased at $17,407,903 on 7/1/96, collateralized by U.S. Treasury Bonds, 9.125%-11.25%, 2/15/15-5/11/18, with a value of $6,150,689, and U.S. Treasury Nts., 5.25%-8.50%, 1/11/97-11/15/04, with a value of $11,623,981 (Cost $17,400,000) $17,400,000 17,400,000 ----------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $114,137,962) 100.0% 144,789,612 ----------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (0.0) (67,404) ----------- ------------ NET ASSETS 100.0% $144,722,208 =========== ============ 1. Non-income producing security. See accompanying Notes to Financial Statements.
36 54 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------------- MORTGAGE-BACKED OBLIGATIONS - 1.4% - ---------------------------------------------------------------------------------------------------------------------------------- Government National Mortgage Assn.: 8%, 4/15/23 $ 3,356,363 $3,398,352 8%, 7/15/22 1,546,051 1,567,310 -------------------------------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates, Series 1994-C2, Cl. E, 8%, 4/25/25 731,922 698,185 ----------- Total Mortgage-Backed Obligations (Cost $5,728,187) 5,663,847 - ---------------------------------------------------------------------------------------------------------------------------------- U.S. GOVERNMENT OBLIGATIONS - 8.3% - ---------------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Bonds, STRIPS, Zero Coupon: 7.101%, 11/15/18 (2) 24,500,000 5,033,891 7.313%, 8/15/19 (2) 26,800,000 5,221,387 -------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Nts.: 6.375%, 8/15/02 5,000,000 4,954,685 6.75%, 5/31/97 10,300,000 10,390,125 9.25%, 8/15/98 9,000,000 9,542,807 ---------------- Total U.S. Government Obligations (Cost $34,746,543) 35,142,895 - ---------------------------------------------------------------------------------------------------------------------------------- FOREIGN GOVERNMENT OBLIGATIONS - 16.4% - ---------------------------------------------------------------------------------------------------------------------------------- Argentina (Republic of): Bonds, Bonos de Consolidacion de Deudas, Series I, 5.445%, 4/1/01 (3)(4) 2,411,806 2,163,275 Par Bonds, 5.25%, 3/31/23 (5) 14,000,000 7,691,179 Past Due Interest Bonds, Series L, 6.312%, 3/31/05 (4) 5,940,000 4,651,733 -------------------------------------------------------------------------------------------------------------------------- Bonos de la Tesoreria de la Federacion, Zero Coupon: 13.124%, 10/3/96 (2)MXP 5,615,100 684,836 21.268%, 9/12/96 (2)MXP 5,977,280 741,705 -------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Par Bonds, 5%, 4/15/24 (5) 8,000,000 4,414,960 -------------------------------------------------------------------------------------------------------------------------- Canada (Government of) Bonds: 8.50%, 4/1/02 CAD 1,500,000 1,168,974 8.75%, 12/1/05 CAD 12,200,000 9,634,964 9.75%, 12/1/01 CAD 3,000,000 2,459,850 9.75%, 6/1/01 CAD 2,000,000 1,631,317 -------------------------------------------------------------------------------------------------------------------------- Denmark (Kingdom of) Bonds, 8%, 3/15/06 DKK 32,100,000 5,691,782 -------------------------------------------------------------------------------------------------------------------------- Eskom Depositary Receipts, Series E168, 11%, 6/1/08 ZAR 8,570,000 1,563,255 -------------------------------------------------------------------------------------------------------------------------- Italy (Republic of) Treasury Bonds, Buoni del Tesoro Poliennali, 8.50%, 8/1/99 ITL 2,700,000,000 1,765,008 -------------------------------------------------------------------------------------------------------------------------- New Zealand (Republic of) Bonds, 8%, 2/15/01 NZD 10,440,000 6,875,828 -------------------------------------------------------------------------------------------------------------------------- Poland (Republic of) Treasury Bills, Zero Coupon: 24.131%, 11/13/96 (2)PLZ 2,300,000 784,858 21.811%, 7/3/96 (2)PLZ 2,860,000 1,051,178 24.426%, 9/4/96 (2)PLZ 7,060,000 2,503,739 -------------------------------------------------------------------------------------------------------------------------- Queensland Treasury Corp. Exchangeable Gtd. Nts., 10.50%, 5/15/03 AUD 3,600,000 3,068,620 -------------------------------------------------------------------------------------------------------------------------- Treasury Corp. of Victoria Gtd. Bonds, 8.25%, 10/15/03 AUD 6,000,000 4,548,184 -------------------------------------------------------------------------------------------------------------------------- United Kingdom Treasury Nts., 13%, 7/14/00 GBP 1,590,000 2,966,197
37 55 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------- FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED) - ---------------------------------------------------------------------------------------------------------------------------- Venezuela (Republic of) Front-Loaded Interest Reduction Bonds, Series B, 6.625%, 3/31/07 (4) $4,000,000 $ 2,895,000 ------------ Total Foreign Government Obligations (Cost $66,770,851) 68,956,442 - ---------------------------------------------------------------------------------------------------------------------------- MUNICIPAL BONDS AND NOTES - 0.1% - ---------------------------------------------------------------------------------------------------------------------------- Port of Portland, Oregon Special Obligation Taxable Revenue Bonds, PAMCO Project, 9.20%, 5/15/22 (Cost $500,000) 500,000 537,055 - ---------------------------------------------------------------------------------------------------------------------------- NON-CONVERTIBLE CORPORATE BONDS AND NOTES - 12.8% - ---------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------- BASIC MATERIALS - 1.6% - ---------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------- CHEMICALS - 0.5% -------------------------------------------------------------------------------------------------------------------- NL Industries, Inc., 11.75% Sr. Sec. Nts., 10/15/03 1,350,000 1,383,750 -------------------------------------------------------------------------------------------------------------------- Quantum Chemical Corp., 10.375% First Mtg. Nts., 6/1/03 500,000 549,026 ------------ 1,932,776 - ---------------------------------------------------------------------------------------------------------------------------- METALS - 0.7% -------------------------------------------------------------------------------------------------------------------- AK Steel Corp., 10.75% Sr. Gtd. Nts., 4/1/04 1,000,000 1,085,000 -------------------------------------------------------------------------------------------------------------------- Armco, Inc., 8.50% Sinking Fund Debs., 9/1/01 200,000 198,000 -------------------------------------------------------------------------------------------------------------------- Kaiser Aluminum & Chemical Corp., 12.75% Sr. Sub. Nts., 2/1/03 1,000,000 1,072,500 -------------------------------------------------------------------------------------------------------------------- Wheel-Pittsburgh Corp., 9.375% Sr. Nts., 11/15/03 500,000 466,250 ------------ 2,821,750 - ---------------------------------------------------------------------------------------------------------------------------- PAPER - 0.4% -------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp., 11.50% Sr. Nts., 5/15/01 500,000 515,000 -------------------------------------------------------------------------------------------------------------------- Repap Wisconsin, Inc., 9.875% Second Priority Sr. Nts., 5/1/06 1,000,000 892,500 -------------------------------------------------------------------------------------------------------------------- Stone Consolidated Corp., 10.25% Sr. Sec. Nts., 12/15/00 350,000 363,125 ------------ 1,770,625 - ---------------------------------------------------------------------------------------------------------------------------- CONSUMER CYCLICALS - 4.9% - ---------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------- AUTOS & HOUSING - 0.5% -------------------------------------------------------------------------------------------------------------------- Chrysler Financial Corp., 13.25% Nts., 10/15/99 500,000 594,385 -------------------------------------------------------------------------------------------------------------------- Penda Corp., 10.75% Sr. Nts., Series B, 3/1/04 825,000 771,375 -------------------------------------------------------------------------------------------------------------------- Saul (B.F.) Real Estate Investment Trust, 11.625% Sr. Sec. Nts., Series B, 4/1/02 950,000 978,500 ------------ 2,344,260 - ---------------------------------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT - 0.6% -------------------------------------------------------------------------------------------------------------------- Apple South, Inc., 9.75% Sr. Nts., 6/1/06 400,000 395,000 -------------------------------------------------------------------------------------------------------------------- Foodmaker, Inc.: 9.25% Sr. Nts., 3/1/99 450,000 444,375 9.75% Sr. Sub. Nts., 6/1/02 350,000 337,750 -------------------------------------------------------------------------------------------------------------------- Imax Corp., 7% Sr. Nts., 3/1/01 (5) 600,000 588,000 -------------------------------------------------------------------------------------------------------------------- Station Casinos, Inc., 9.625% Sr. Sub. Nts., 6/1/03 750,000 738,750 ------------ 2,503,875 - ---------------------------------------------------------------------------------------------------------------------------- MEDIA - 3.3% -------------------------------------------------------------------------------------------------------------------- American Telecasting, Inc., 0%/14.50% Sr. Disc. Nts., 6/15/04 (6) 749,948 524,964
38 56 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------------- MEDIA - 3.3% -------------------------------------------------------------------------------------------------------------------------- Bell & Howell Co. (New), 0%/11.50% Sr. Disc. Debs., Series B, 3/1/05 (6) $1,000,000 $ 687,500 -------------------------------------------------------------------------------------------------------------------------- Bell Cablemedia PLC, 0%/11.95% Sr. Disc. Nts., 7/15/04 (6) 900,000 634,500 -------------------------------------------------------------------------------------------------------------------------- Cablevision Industries Corp., 9.25% Sr. Debs., Series B, 4/1/08 500,000 506,250 -------------------------------------------------------------------------------------------------------------------------- EchoStar Communications Corp., 0%/12.875% Sr. Disc. Nts., 6/1/04 (6) 1,100,000 803,000 -------------------------------------------------------------------------------------------------------------------------- EchoStar Satellite Broadcasting Corp., 0%/13.125% Sr. Sec. Disc. Nts., 3/15/04 (6)(7) 500,000 312,500 -------------------------------------------------------------------------------------------------------------------------- Helicon Group LP/Helicon Capital Corp., 9% Sr. Sec. Nts., Series B, 11/1/03 (4) 650,000 646,750 -------------------------------------------------------------------------------------------------------------------------- International CableTel, Inc., 0%/10.875% Sr. Deferred Coupon Nts., 10/15/03 (6) 500,000 365,000 -------------------------------------------------------------------------------------------------------------------------- Lamar Advertising Co., 11% Sr. Sec. Nts., 5/15/03 750,000 770,625 -------------------------------------------------------------------------------------------------------------------------- Outlet Broadcasting, Inc., 10.875% Sr. Sub. Nts., 7/15/03 1,000,000 1,114,594 -------------------------------------------------------------------------------------------------------------------------- Panamsat LP/Panamsat Capital Corp.: 0%/11.375% Sr. Sub. Disc. Nts., 8/1/03 (6) 1,000,000 875,000 9.75% Sr. Sec. Nts., 8/1/00 500,000 520,000 -------------------------------------------------------------------------------------------------------------------------- People's Choice TV Corp., 0%/13.125% Sr. Disc. Nts., 6/1/04 (6) 500,000 287,500 -------------------------------------------------------------------------------------------------------------------------- Rogers Cablesystems Ltd., 10% Sr. Sec. Second Priority Debs., 12/1/07 1,000,000 977,500 -------------------------------------------------------------------------------------------------------------------------- SCI Television, Inc., 11% Sr. Nts., Series 1, 6/30/05 500,000 522,500 -------------------------------------------------------------------------------------------------------------------------- SFX Broadcasting, Inc., 10.75% Sr. Sub. Nts., 5/15/06 (7) 540,000 540,000 -------------------------------------------------------------------------------------------------------------------------- Sinclair Broadcast Group, Inc., 10% Sr. Sub. Nts., 9/30/05 500,000 487,500 -------------------------------------------------------------------------------------------------------------------------- TeleWest PLC, 9.625% Sr. Debs., 10/1/06 500,000 486,250 -------------------------------------------------------------------------------------------------------------------------- Time Warner Entertainment LP/Time Warner, Inc.: 10.15% Sr. Nts., 5/1/12 500,000 577,118 8.375% Sr. Debs., 3/15/23 500,000 486,814 -------------------------------------------------------------------------------------------------------------------------- Time Warner, Inc., 9.125% Debs., 1/15/13 500,000 523,539 -------------------------------------------------------------------------------------------------------------------------- TKR Cable I, Inc., 10.50% Sr. Debs., 10/30/07 1,000,000 1,113,348 ------------ 13,762,752 - ---------------------------------------------------------------------------------------------------------------------------------- RETAIL: GENERAL - 0.1% -------------------------------------------------------------------------------------------------------------------------- Synthetic Industries, Inc., 12.75% Sr. Sub. Debs., 12/1/02 600,000 637,500 - ---------------------------------------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY - 0.4% -------------------------------------------------------------------------------------------------------------------------- Cole National Group, Inc., 11.25% Sr. Nts., 10/1/01 1,000,000 1,057,500 -------------------------------------------------------------------------------------------------------------------------- Finlay Fine Jewelry Corp., 10.625% Sr. Nts., 5/1/03 750,000 753,750 ------------ 1,811,250 - ---------------------------------------------------------------------------------------------------------------------------------- CONSUMER NON-CYCLICALS - 1.6% - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- FOOD - 0.5% -------------------------------------------------------------------------------------------------------------------------- Grand Union Co., 12% Sr. Nts., 9/1/04 1,103,000 1,035,441 -------------------------------------------------------------------------------------------------------------------------- Penn Traffic Co., 9.625% Sr. Sub. Nts., 4/15/05 500,000 361,250 -------------------------------------------------------------------------------------------------------------------------- Purity Supreme, Inc., 11.75% Sr. Sec. Nts., Series B, 8/1/99 300,000 324,375 -------------------------------------------------------------------------------------------------------------------------- RJR Nabisco, Inc., 8.625% Medium-Term Nts., 12/1/02 500,000 507,944 ------------ 2,229,010 - ---------------------------------------------------------------------------------------------------------------------------------- HEALTHCARE/SUPPLIES & SERVICES - 0.4% -------------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc., 13% Sr. Sub. Nts., 7/15/02 1,000,000 1,115,000
39 57 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------------- HEALTHCARE/SUPPLIES & SERVICES (CONTINUED) -------------------------------------------------------------------------------------------------------------------------- Magellan Health Services, Inc., 11.25% Sr. Sub. Nts., Series A, 4/15/04 $ 500,000 $ 540,000 ----------- 1,655,000 - --------------------------------------------------------------------------------------------------------------------------------- HOUSEHOLD GOODS - 0.7% ------------------------------------------------------------------------------------------------------------------------- Coleman Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts., Series B, 11.404%, 5/27/98 (2) 1,500,000 1,263,750 ------------------------------------------------------------------------------------------------------------------------- Harman International Industries, Inc., 12% Sr. Sub. Nts., 8/1/02 1,000,000 1,095,000 ------------------------------------------------------------------------------------------------------------------------- Revlon Worldwide Corp., Zero Coupon Sr. Sec. Disc. Nts., 13.169%, 3/15/98 (2) 500,000 418,750 ----------- 2,777,500 - --------------------------------------------------------------------------------------------------------------------------------- ENERGY - 0.3% - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS - 0.3% ------------------------------------------------------------------------------------------------------------------------- OPI International, Inc., 12.875% Sr. Gtd. Nts., 7/15/02 1,000,000 1,110,000 - --------------------------------------------------------------------------------------------------------------------------------- FINANCIAL - 0.3% - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- BANKS - 0.1% ------------------------------------------------------------------------------------------------------------------------- First Chicago Corp.: 11.25% Sub. Nts., 2/20/01 250,000 292,350 9% Sub. Nts., 6/15/99 250,000 265,803 ----------- 558,153 - --------------------------------------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 0.2% ------------------------------------------------------------------------------------------------------------------------- GPA Delaware, Inc., 8.75% Gtd. Nts., 12/15/98 1,000,000 1,000,000 - --------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL - 1.5% - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL MATERIALS - 0.7% ------------------------------------------------------------------------------------------------------------------------- American Standard, Inc., 10.875% Sr. Nts., 5/15/99 500,000 528,750 ------------------------------------------------------------------------------------------------------------------------- Owens-Illinois, Inc.: 10% Sr. Sub. Nts., 8/1/02 500,000 512,500 11% Sr. Debs., 12/1/03 500,000 538,750 ------------------------------------------------------------------------------------------------------------------------- Pacific Lumber Co., 10.50% Sr. Nts., 3/1/03 425,000 415,438 ------------------------------------------------------------------------------------------------------------------------- Triangle Pacific Corp., 10.50% Sr. Nts., 8/1/03 850,000 875,500 ----------- 2,870,938 - --------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL SERVICES - 0.3% ------------------------------------------------------------------------------------------------------------------------- EnviroSource, Inc., 9.75% Sr. Nts., 6/15/03 1,250,000 1,150,000 - --------------------------------------------------------------------------------------------------------------------------------- MANUFACTURING - 0.4% ------------------------------------------------------------------------------------------------------------------------- Talley Industries, Inc., 0%/12.25% Sr. Disc. Debs., 10/15/05 (6) 1,074,000 859,200 ------------------------------------------------------------------------------------------------------------------------- Terex Corp., 13.75% Sr. Sec. Nts., 5/15/02 (7) 1,000,000 1,040,000 ----------- 1,899,200 - --------------------------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 0.1% ------------------------------------------------------------------------------------------------------------------------- Trans Ocean Container Corp., 12.25% Sr. Sub. Nts., 7/1/04 500,000 517,500 - --------------------------------------------------------------------------------------------------------------------------------- TECHNOLOGY - 1.8% - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- AEROSPACE/DEFENSE - 0.2% ------------------------------------------------------------------------------------------------------------------------- Unisys Corp., 15% Credit Sensitive Nts., 7/1/97 (4) 650,000 693,875 - --------------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 1.6% ------------------------------------------------------------------------------------------------------------------------- 360 Communications Co., 7.50% Sr. Nts., 3/1/06 500,000 475,230 ------------------------------------------------------------------------------------------------------------------------- Call-Net Enterprises, Inc., 0%/13.25% Sr. Disc. Nts., 12/1/04 (6) 800,000 594,000 ------------------------------------------------------------------------------------------------------------------------- Comcast Cellular Corp., Zero Coupon Nts., Series B, 7.829%, 3/5/00 (2) 1,000,000 690,000
40 58 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY (CONTINUED) ------------------------------------------------------------------------------------------------------------------------ Horizon Cellular Telephone LP/Horizon Finance Corp., 0%/11.375% Sr. Sub. Disc. Nts., 10/1/00 (6) $1,200,000 $ 1,131,000 ------------------------------------------------------------------------------------------------------------------------ IntelCom Group (USA), Inc., 0%/13.50% Sr. Disc. Nts., 9/15/05 (6) 1,000,000 602,500 ------------------------------------------------------------------------------------------------------------------------ MFS Communications Co., Inc., 0%/9.375% Sr. Disc. Nts., 1/15/04 (6) 1,850,000 1,406,000 ------------------------------------------------------------------------------------------------------------------------ PriCellular Wireless Corp., 0%/14% Sr. Sub. Disc. Nts., 11/15/01 (6) 1,000,000 910,000 ------------------------------------------------------------------------------------------------------------------------ USA Mobile Communications, Inc. II, 9.50% Sr. Nts., 2/1/04 1,000,000 930,000 ------------ 6,738,730 - -------------------------------------------------------------------------------------------------------------------------------- UTILITIES - 0.8% - -------------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------------- ELECTRIC UTILITIES - 0.4% ------------------------------------------------------------------------------------------------------------------------ First PV Funding Corp., 10.15% Lease Obligation Bonds, Series 1986B, 1/15/16 1,500,000 1,578,750 - -------------------------------------------------------------------------------------------------------------------------------- GAS UTILITIES - 0.4% ------------------------------------------------------------------------------------------------------------------------ Beaver Valley II Funding Corp., 9% Second Lease Obligation Bonds, 6/1/17 989,000 803,563 ------------------------------------------------------------------------------------------------------------------------ California Energy Co., 0%/10.25% Sr. Disc. Nts., 1/15/04 (6) 750,000 735,000 ------------ 1,538,563 ----------- Total Non-Convertible Corporate Bonds and Notes (Cost $52,822,980) 53,902,007 - -------------------------------------------------------------------------------------------------------------------------------- CONVERTIBLE CORPORATE BONDS AND NOTES - 0.2% - -------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------ Castorama Dubois Investments, 3.15% Cv. Bonds, 1/1/03 FRF 165,000 38,461 ------------------------------------------------------------------------------------------------------------------------ MEDIQ, Inc., 7.50% Exchangeable Sub. Debs., 7/15/03 1,000,000 850,000 ----------- Total Convertible Corporate Bonds and Notes (Cost $966,302) 888,461 SHARES - ------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS - 42.7% - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- BASIC MATERIALS - 3.1% - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- CHEMICALS - 1.6% ----------------------------------------------------------------------------------------------------------------------- Agrium, Inc. 80,000 1,048,750 ----------------------------------------------------------------------------------------------------------------------- ARCO Chemical Co. 17,900 930,800 ----------------------------------------------------------------------------------------------------------------------- Bayer AG, Sponsored ADR 70,000 2,471,847 ----------------------------------------------------------------------------------------------------------------------- Dow Chemical Co. (The) 8,000 608,000 ----------------------------------------------------------------------------------------------------------------------- Georgia Gulf Corp. 20,400 596,700 ----------------------------------------------------------------------------------------------------------------------- IMC Global, Inc. 7,600 285,950 ----------------------------------------------------------------------------------------------------------------------- Sybron Chemical Industries, Inc. (8) 48,000 696,000 -------------- 6,638,047 - ------------------------------------------------------------------------------------------------------------------------------- GOLD - 0.2% ----------------------------------------------------------------------------------------------------------------------- Santa Fe Pacific Gold Corp. 70,000 988,750 - ------------------------------------------------------------------------------------------------------------------------------- METALS - 0.6% ----------------------------------------------------------------------------------------------------------------------- Brush Wellman, Inc. 69,300 1,316,700 ----------------------------------------------------------------------------------------------------------------------- Inco Ltd. 15,200 490,200 ----------------------------------------------------------------------------------------------------------------------- J&L Specialty Steel, Inc. 45,500 676,812 -------------- 2,483,712
41 59 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------- PAPER - 0.7% ------------------------------------------------------------------------------------------------------------------ Aracruz Celulose SA, Sponsored ADR, Cl. B 121,000 $1,149,500 ------------------------------------------------------------------------------------------------------------------ MacMillan Bloedel Ltd. 76,830 1,018,309 ------------------------------------------------------------------------------------------------------------------ MacMillan Bloedel Ltd. 4,200 55,650 ------------------------------------------------------------------------------------------------------------------ Stone Container Corp. 54,000 742,500 ----------- 2,965,959 - -------------------------------------------------------------------------------------------------------------------------- CONSUMER CYCLICALS - 8.2% - -------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------- AUTOS & HOUSING - 1.2% ------------------------------------------------------------------------------------------------------------------ Chromcraft Revington, Inc. (8) 18,500 432,437 ------------------------------------------------------------------------------------------------------------------ Eaton Corp. 14,000 820,750 ------------------------------------------------------------------------------------------------------------------ Excel Industries, Inc. 52,000 650,000 ------------------------------------------------------------------------------------------------------------------ Fiat SpA 310,000 1,038,422 ------------------------------------------------------------------------------------------------------------------ General Motors Corp. 22,500 1,178,437 ------------------------------------------------------------------------------------------------------------------ IRSA Inversiones y Representaciones, SA 214,506 730,355 ----------- 4,850,401 - -------------------------------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT - 3.6% ------------------------------------------------------------------------------------------------------------------ AMR Corp. 16,700 1,519,700 ------------------------------------------------------------------------------------------------------------------ Carnival Corp., Cl. A 34,100 984,637 ------------------------------------------------------------------------------------------------------------------ Cheesecake Factory (The) (8) 24,000 660,000 ------------------------------------------------------------------------------------------------------------------ Circus Circus Enterprises, Inc. (8)(10) 34,000 1,394,000 ------------------------------------------------------------------------------------------------------------------ Cracker Barrel Old Country Store, Inc. 64,000 1,552,000 ------------------------------------------------------------------------------------------------------------------ Disney (Walt) Co. 23,493 1,477,122 ------------------------------------------------------------------------------------------------------------------ Eastman Kodak Co. 10) 18,000 1,399,500 ------------------------------------------------------------------------------------------------------------------ International Game Technology 60,000 1,012,500 ------------------------------------------------------------------------------------------------------------------ King World Productions, Inc. (8)(10) 31,000 1,127,625 ------------------------------------------------------------------------------------------------------------------ Mattel, Inc. 32,296 924,480 ------------------------------------------------------------------------------------------------------------------ Primadonna Resorts, Inc. (8) 45,000 1,035,000 ------------------------------------------------------------------------------------------------------------------ Shimano, Inc. 70,000 1,250,895 ------------------------------------------------------------------------------------------------------------------ U S West Media Group (8) 45,700 834,025 ----------- 15,171,484 - -------------------------------------------------------------------------------------------------------------------------- MEDIA - 1.1% ------------------------------------------------------------------------------------------------------------------ Bowne & Co., Inc. 39,100 806,437 ------------------------------------------------------------------------------------------------------------------ Comcast Corp., Cl. A Special 75,000 1,387,500 ------------------------------------------------------------------------------------------------------------------ Dow Jones & Co., Inc. 19,400 809,950 ------------------------------------------------------------------------------------------------------------------ South China Morning Post Holdings Ltd. 1,800,000 1,232,477 ------------------------------------------------------------------------------------------------------------------ Time Warner, Inc. 13,200 518,100 ----------- 4,754,464 - -------------------------------------------------------------------------------------------------------------------------- RETAIL: GENERAL - 1.1% ------------------------------------------------------------------------------------------------------------------ Cone Mills Corp. (8) 162,300 1,825,875 ------------------------------------------------------------------------------------------------------------------ Price/Costco, Inc. (8) 58,900 1,273,712 ------------------------------------------------------------------------------------------------------------------ Tuesday Morning Corp. (8) 54,500 728,937 ------------------------------------------------------------------------------------------------------------------ Wal-Mart Stores, Inc. 33,700 855,137 ----------- 4,683,661 - -------------------------------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY - 1.2% ------------------------------------------------------------------------------------------------------------------ Books-A-Million, Inc. (8) 84,800 710,200 ------------------------------------------------------------------------------------------------------------------ Burlington Coat Factory Warehouse Corp. (8) 62,000 651,000 ------------------------------------------------------------------------------------------------------------------ Castorama Dubois Investissements LP 4,131 813,668 ------------------------------------------------------------------------------------------------------------------ Gymboree Corp. (8)(10) 28,900 881,450 ------------------------------------------------------------------------------------------------------------------ Toys 'R' Us, Inc. (8) 49,200 1,402,200
42 60 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------ RETAIL: SPECIALTY (CONTINUED) ---------------------------------------------------------------------------------------------------------------------- Tractor Supply Co. (8) 30,000 $ 682,500 ------------ 5,141,018 - ------------------------------------------------------------------------------------------------------------------------------ CONSUMER NON-CYCLICALS - 7.8% - ------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------ BEVERAGES - 0.5% ---------------------------------------------------------------------------------------------------------------------- Buenos Aires Embotelladora SA, Sponsored ADR 35,000 463,750 ---------------------------------------------------------------------------------------------------------------------- Guinness PLC 100,000 727,179 ---------------------------------------------------------------------------------------------------------------------- Whitman Corp. (10) 43,400 1,047,025 ------------ 2,237,954 - ------------------------------------------------------------------------------------------------------------------------------ FOOD - 1.0% ---------------------------------------------------------------------------------------------------------------------- Chiquita Brands International, Inc. 18,880 245,440 ---------------------------------------------------------------------------------------------------------------------- Grand Union Co. (8) 6,185 40,202 ---------------------------------------------------------------------------------------------------------------------- Groupe Danone 5,013 758,559 ---------------------------------------------------------------------------------------------------------------------- IBP, Inc. (10) 31,500 870,187 ---------------------------------------------------------------------------------------------------------------------- Nestle SA, Sponsored ADR 12,000 685,020 ---------------------------------------------------------------------------------------------------------------------- Sara Lee Corp. (10) 43,800 1,418,025 ------------ 4,017,433 - ------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/DRUGS - 3.8% ---------------------------------------------------------------------------------------------------------------------- Abbott Laboratories 20,000 870,000 ---------------------------------------------------------------------------------------------------------------------- Agouron Pharmaceuticals, Inc. (8) 17,000 663,000 ---------------------------------------------------------------------------------------------------------------------- American Home Products Corp. 20,000 1,202,500 ---------------------------------------------------------------------------------------------------------------------- Astra AB Free, Series A 15,500 684,427 ---------------------------------------------------------------------------------------------------------------------- Bristol-Myers Squibb Co. 25,000 2,250,000 ---------------------------------------------------------------------------------------------------------------------- Ciba-Geigy AG 2,700 3,289,681 ---------------------------------------------------------------------------------------------------------------------- Foundation Health Corp. (8) 24,000 861,000 ---------------------------------------------------------------------------------------------------------------------- Genzyme Corp. (8)(10) 24,000 1,206,000 ---------------------------------------------------------------------------------------------------------------------- Johnson & Johnson 29,800 1,475,100 ---------------------------------------------------------------------------------------------------------------------- Mylan Laboratories, Inc. 43,000 741,750 ---------------------------------------------------------------------------------------------------------------------- NBTY, Inc. (8) 167,000 1,680,438 ---------------------------------------------------------------------------------------------------------------------- SmithKline Beecham PLC, ADR 22,500 1,223,438 ------------ 16,147,334 - ------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE/SUPPLIES & SERVICES - 1.3% ---------------------------------------------------------------------------------------------------------------------- Biomet, Inc. (8) 45,100 648,313 ---------------------------------------------------------------------------------------------------------------------- Cardinal Health, Inc. (10) 4,146 299,030 ---------------------------------------------------------------------------------------------------------------------- Manor Care, Inc. (10) 24,985 983,784 ---------------------------------------------------------------------------------------------------------------------- Medtronic, Inc. 15,700 879,200 ---------------------------------------------------------------------------------------------------------------------- Nellcor Puritan Bennett, Inc. (8) 6,600 320,100 ---------------------------------------------------------------------------------------------------------------------- Sofamor Danek Group, Inc. (8) 15,000 416,250 ---------------------------------------------------------------------------------------------------------------------- U.S. Healthcare, Inc. (10) 18,900 1,039,500 ---------------------------------------------------------------------------------------------------------------------- WellPoint Health Networks, Inc. (8)(10) 30,481 952,531 ------------ 5,538,708 - ------------------------------------------------------------------------------------------------------------------------------ HOUSEHOLD GOODS - 0.7% ---------------------------------------------------------------------------------------------------------------------- Kimberly-Clark Corp. 13,100 1,011,975 ---------------------------------------------------------------------------------------------------------------------- Procter & Gamble Co. (10) 12,000 1,087,500 ---------------------------------------------------------------------------------------------------------------------- Scott's Liquid Gold, Inc. (8) 57,200 121,550 ---------------------------------------------------------------------------------------------------------------------- Wella AG 1,550 888,979 ------------ 3,110,004 - ------------------------------------------------------------------------------------------------------------------------------ TOBACCO - 0.5% ---------------------------------------------------------------------------------------------------------------------- Philip Morris Cos., Inc. 21,300 2,215,200
43 61 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ------------------------------------------------------------------------------------------------------------------------------- ENERGY - 2.5% - ------------------------------------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS - 0.8% ----------------------------------------------------------------------------------------------------------------------- Kerr-McGee Corp. (10) 12,000 $ 730,500 ----------------------------------------------------------------------------------------------------------------------- Landmark Graphics Corp. (8) 59,200 1,139,600 ----------------------------------------------------------------------------------------------------------------------- Western Atlas, Inc. (8) 22,000 1,281,500 ------------ 3,151,600 - ------------------------------------------------------------------------------------------------------------------------------- OIL-INTEGRATED - 1.7% ----------------------------------------------------------------------------------------------------------------------- Atlantic Richfield Co. 11,900 1,410,150 ----------------------------------------------------------------------------------------------------------------------- Enterprise Oil PLC 118,000 843,403 ----------------------------------------------------------------------------------------------------------------------- Louisiana Land & Exploration Co. 23,100 1,331,138 ----------------------------------------------------------------------------------------------------------------------- Royal Dutch Petroleum Co. 9,500 1,460,625 ----------------------------------------------------------------------------------------------------------------------- Saga Petroleum AS, Cl. A 12,000 176,407 ----------------------------------------------------------------------------------------------------------------------- Saga Petroleum AS, Cl. B 19,000 257,376 ----------------------------------------------------------------------------------------------------------------------- Total SA, Sponsored ADR (10) 21,701 805,650 ----------------------------------------------------------------------------------------------------------------------- Unocal Corp. 22,000 742,500 ----------------------------------------------------------------------------------------------------------------------- Yukong Ltd., GDR (7) 27,500 179,677 ----------------------------------------------------------------------------------------------------------------------- Yukong Ltd., GDR 958 8,153 ----------------------------------------------------------------------------------------------------------------------- Yukong Ltd., GDR 2,336 19,879 ------------ 7,234,958 - ------------------------------------------------------------------------------------------------------------------------------- FINANCIAL - 5.4% - ------------------------------------------------------------------------------------------------------------------------------- BANKS - 2.6% ----------------------------------------------------------------------------------------------------------------------- Akbank T.A.S. 2,660,750 320,602 ----------------------------------------------------------------------------------------------------------------------- Banco Frances del Rio de la Plata SA 87,000 838,127 ----------------------------------------------------------------------------------------------------------------------- Chase Manhattan Corp. (New) (10) 58,000 4,096,250 ----------------------------------------------------------------------------------------------------------------------- Citicorp (10) 13,000 1,074,125 ----------------------------------------------------------------------------------------------------------------------- Deutsche Bank, Sponsored ADR 13,250 626,749 ----------------------------------------------------------------------------------------------------------------------- NationsBank Corp. 49,600 4,098,200 ------------ 11,054,053 - ------------------------------------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 1.1% ----------------------------------------------------------------------------------------------------------------------- American Express Co. 35,000 1,561,875 ----------------------------------------------------------------------------------------------------------------------- Dean Witter, Discover & Co. 15,000 858,750 ----------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp. 9,700 829,350 ----------------------------------------------------------------------------------------------------------------------- H & R Block, Inc. (10) 26,000 848,250 ----------------------------------------------------------------------------------------------------------------------- Santa Anita Realty Enterprises, Inc., Units (each unit consists of one share of Santa Anita Operating Co. and one share of Santa Anita Realty Enterprises, Inc., common stock) (9)(11) 40,000 505,000 ------------ 4,603,225 - ------------------------------------------------------------------------------------------------------------------------------- INSURANCE - 1.7% ----------------------------------------------------------------------------------------------------------------------- ACE Ltd. 21,600 1,015,200 ----------------------------------------------------------------------------------------------------------------------- Aetna Life & Casualty Co. 4,400 314,600 ----------------------------------------------------------------------------------------------------------------------- American International Group, Inc. 12,600 1,242,675 ----------------------------------------------------------------------------------------------------------------------- American Re Corp. (10) 43,400 1,947,575 ----------------------------------------------------------------------------------------------------------------------- Berkley (W.R.) Corp. 21,000 876,750 ----------------------------------------------------------------------------------------------------------------------- Skandia Forsakrings AB 40,000 1,057,950 ----------------------------------------------------------------------------------------------------------------------- UNUM Corp. 13,600 846,600 ------------ 7,301,350
44 62 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ---------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL - 4.3% - ---------------------------------------------------------------------------------------------------------------------------- ELECTRICAL EQUIPMENT - 0.5% -------------------------------------------------------------------------------------------------------------------- Core Industries, Inc. 50,000 $ 718,750 -------------------------------------------------------------------------------------------------------------------- General Electric Co. (10) 18,000 1,557,000 ----------- 2,275,750 - ---------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL MATERIALS - 0.8% -------------------------------------------------------------------------------------------------------------------- Insituform Technologies, Cl. A (8) 83,000 643,250 -------------------------------------------------------------------------------------------------------------------- Interpool, Inc. 37,500 684,375 -------------------------------------------------------------------------------------------------------------------- Owens Corning 30,000 1,290,000 -------------------------------------------------------------------------------------------------------------------- Walter Industries, Inc. (8) 2,645 37,361 -------------------------------------------------------------------------------------------------------------------- Wolverine Tube, Inc. (8) 24,200 847,000 ----------- 3,501,986 - ---------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL SERVICES - 0.2% -------------------------------------------------------------------------------------------------------------------- Ecolab, Inc. (10) 23,400 772,200 - ---------------------------------------------------------------------------------------------------------------------------- MANUFACTURING - 1.6% -------------------------------------------------------------------------------------------------------------------- Citic Pacific Ltd. 216,000 873,431 -------------------------------------------------------------------------------------------------------------------- Griffon Corp. (8) 64,000 520,000 -------------------------------------------------------------------------------------------------------------------- Harnischfeger Industries, Inc. (10) 15,800 525,350 -------------------------------------------------------------------------------------------------------------------- Hutchison Whampoa Ltd. 128,000 805,322 -------------------------------------------------------------------------------------------------------------------- Mannesmann AG 2,400 826,206 -------------------------------------------------------------------------------------------------------------------- Pacific Dunlop Ltd. 400,000 900,389 -------------------------------------------------------------------------------------------------------------------- Tenneco, Inc. (10) 26,000 1,329,250 -------------------------------------------------------------------------------------------------------------------- Westinghouse Air Brake Co. 55,000 721,875 ----------- 6,501,823 - ---------------------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 1.2% -------------------------------------------------------------------------------------------------------------------- Airborne Freight Corp. (10) 37,000 962,000 -------------------------------------------------------------------------------------------------------------------- Burlington Northern Santa Fe Corp. (10) 15,600 1,261,650 -------------------------------------------------------------------------------------------------------------------- Canadian National Railway Co. 38,000 699,828 -------------------------------------------------------------------------------------------------------------------- Consolidated Freightways, Inc. 12,200 257,725 -------------------------------------------------------------------------------------------------------------------- Spartan Motors, Inc. 75,000 562,500 -------------------------------------------------------------------------------------------------------------------- Stolt-Nielsen SA 44,100 799,313 -------------------------------------------------------------------------------------------------------------------- Stolt-Nielsen SA, ADR 22,050 410,681 ----------- 4,953,697 - ---------------------------------------------------------------------------------------------------------------------------- TECHNOLOGY - 10.0% - ---------------------------------------------------------------------------------------------------------------------------- AEROSPACE/DEFENSE - 0.3% -------------------------------------------------------------------------------------------------------------------- Rockwell International Corp. (10) 17,900 1,024,775 - ---------------------------------------------------------------------------------------------------------------------------- COMPUTER HARDWARE - 1.6% -------------------------------------------------------------------------------------------------------------------- Digital Equipment Corp. (8) 17,000 765,000 -------------------------------------------------------------------------------------------------------------------- EMC Corp. (8) 30,300 564,338 -------------------------------------------------------------------------------------------------------------------- International Business Machines Corp. (10) 17,500 1,732,500 -------------------------------------------------------------------------------------------------------------------- Moore Corp. Ltd. 31,600 596,450 -------------------------------------------------------------------------------------------------------------------- Seagate Technology, Inc. (8) 11,700 526,500 -------------------------------------------------------------------------------------------------------------------- Silicon Graphics, Inc. (8) 15,000 360,000 -------------------------------------------------------------------------------------------------------------------- Storage Technology Corp. (New) (10) 13,100 501,075 -------------------------------------------------------------------------------------------------------------------- Sun Microsystems, Inc. (10) 7,000 412,125 -------------------------------------------------------------------------------------------------------------------- Xerox Corp. (10) 25,500 1,364,250 ----------- 6,822,238 - ---------------------------------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE - 3.3% -------------------------------------------------------------------------------------------------------------------- American Software, Inc. 100,000 462,500
45 63 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ----------------------------------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE (CONTINUED) --------------------------------------------------------------------------------------------------------------------- Computer Associates International, Inc. (10) 28,650 $ 2,041,313 --------------------------------------------------------------------------------------------------------------------- Davidson & Associates, Inc. (8) 27,200 816,000 --------------------------------------------------------------------------------------------------------------------- Electronic Arts, Inc. (8) 41,300 1,104,775 --------------------------------------------------------------------------------------------------------------------- Inference Corp., Cl. A (8) 40,000 960,000 --------------------------------------------------------------------------------------------------------------------- Informix Corp. (10) 35,200 792,000 --------------------------------------------------------------------------------------------------------------------- Microsoft Corp. (8) 4,900 588,613 --------------------------------------------------------------------------------------------------------------------- Nintendo Co. Ltd. 32,000 2,380,712 --------------------------------------------------------------------------------------------------------------------- Novell, Inc. (8) 130,900 1,816,238 --------------------------------------------------------------------------------------------------------------------- Structural Dynamics Research Corp. (8) 31,000 682,000 --------------------------------------------------------------------------------------------------------------------- Sybase, Inc. (8) 30,000 708,750 --------------------------------------------------------------------------------------------------------------------- Symantec Corp. (8) 117,364 1,467,050 ------------ 13,819,951 - ----------------------------------------------------------------------------------------------------------------------------- ELECTRONICS - 3.3% --------------------------------------------------------------------------------------------------------------------- CAE, Inc. 115,433 959,392 --------------------------------------------------------------------------------------------------------------------- Duracell International, Inc. 16,200 698,625 --------------------------------------------------------------------------------------------------------------------- General Motors Corp., Cl. H (10) 16,600 998,075 --------------------------------------------------------------------------------------------------------------------- Hewlett-Packard Co. 15,000 1,494,375 --------------------------------------------------------------------------------------------------------------------- Intel Corp. 55,400 4,068,438 --------------------------------------------------------------------------------------------------------------------- Kyocera Corp. 14,000 989,228 --------------------------------------------------------------------------------------------------------------------- LSI Logic Corp. (8)(10) 24,000 624,000 --------------------------------------------------------------------------------------------------------------------- Nokia Corp., Preference 20,300 751,100 --------------------------------------------------------------------------------------------------------------------- Proxima Corp. (8) 70,000 848,750 --------------------------------------------------------------------------------------------------------------------- Samsung Electronics, GDR (8) 1,320 37,125 --------------------------------------------------------------------------------------------------------------------- Samsung Electronics, GDR (New) (8) 33 1,687 --------------------------------------------------------------------------------------------------------------------- Teradyne, Inc. (8) 49,000 845,250 --------------------------------------------------------------------------------------------------------------------- VLSI Technology, Inc. (8) 58,300 808,913 --------------------------------------------------------------------------------------------------------------------- Xilinx, Inc. (8) 18,200 577,850 ------------ 13,702,808 - ----------------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 1.5% --------------------------------------------------------------------------------------------------------------------- Airtouch Communications, Inc. (8)(10) 50,000 1,412,500 --------------------------------------------------------------------------------------------------------------------- Bay Networks, Inc. (8)(10) 16,607 427,630 --------------------------------------------------------------------------------------------------------------------- ECI Telecommunications Ltd. (10) 51,000 1,185,750 --------------------------------------------------------------------------------------------------------------------- Kinnevik Investments AB Free, Series B 24,500 742,147 --------------------------------------------------------------------------------------------------------------------- MCI Communications Corp. 47,000 1,204,375 --------------------------------------------------------------------------------------------------------------------- NetCom Systems AB, B Shares (8) 24,500 276,921 --------------------------------------------------------------------------------------------------------------------- Tellabs, Inc. (8) 13,600 909,500 ------------ 6,158,823 - ----------------------------------------------------------------------------------------------------------------------------- UTILITIES - 1.4% - ----------------------------------------------------------------------------------------------------------------------------- ELECTRIC UTILITIES - 0.5% --------------------------------------------------------------------------------------------------------------------- Public Service Enterprise Group, Inc. 52,000 1,423,500 --------------------------------------------------------------------------------------------------------------------- Verbund Oest Electriz 9,400 717,352 ------------ 2,140,852 - ----------------------------------------------------------------------------------------------------------------------------- GAS UTILITIES - 0.3% --------------------------------------------------------------------------------------------------------------------- Hong Kong & China Gas 232,512 370,974 --------------------------------------------------------------------------------------------------------------------- Southwestern Energy Co. 72,500 1,024,063 ------------ 1,395,037 - ----------------------------------------------------------------------------------------------------------------------------- TELEPHONE UTILITIES - 0.6% --------------------------------------------------------------------------------------------------------------------- BCE, Inc. 33,000 1,303,500
46 64 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - --------------------------------------------------------------------------------------------------------------------------------- TELEPHONE UTILITIES (CONTINUED) ------------------------------------------------------------------------------------------------------------------------- Portugal Telecom SA 15,900 $ 415,321 ------------------------------------------------------------------------------------------------------------------------- U S West Communications Group 28,000 892,500 ------------- 2,611,321 ------------- Total Common Stocks (Cost $135,517,312) 179,970,576 - --------------------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS - 1.2% - --------------------------------------------------------------------------------------------------------------------------------- Alumax, Inc., $4.00 Cv., Series A 8,000 1,043,000 ------------------------------------------------------------------------------------------------------------------------- Cyprus Amax Minerals Co., $4.00 Cv., Series A 24,000 1,314,000 ------------------------------------------------------------------------------------------------------------------------- Delta Air Lines, Inc., $3.50 Cv. Depositary Shares, Series C 13,200 831,600 ------------------------------------------------------------------------------------------------------------------------- K-III Communications Corp., Sr. Exchangeable, Series A 20,000 527,500 ------------------------------------------------------------------------------------------------------------------------- Pantry Pride, Inc., $14.875 Exchangeable, Series B 8,000 802,000 ------------------------------------------------------------------------------------------------------------------------- Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred Stock (3)(7) 700 686,000 ------------ Total Preferred Stocks (Cost $4,753,627) 5,204,100 UNITS - --------------------------------------------------------------------------------------------------------------------------------- RIGHTS, WARRANTS AND CERTIFICATES - 0.0% - --------------------------------------------------------------------------------------------------------------------------------- American Telecasting, Inc. Wts., Exp. 6/99 6,000 36,000 ------------------------------------------------------------------------------------------------------------------------- Hong Kong & China Gas Wts., Exp. 9/97 29,376 7,685 ------------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp. Wts., Exp. 11/02 9,232 72,125 ------------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc. Wts., Exp. 11/99 (7) 1,000 25,000 ------------------------------------------------------------------------------------------------------------------------- People's Choice TV Corp. Wts., Exp. 6/00 500 500 ------------------------------------------------------------------------------------------------------------------------- Terex Corp. Rts., Exp. 5/02 (7) 4,000 9,000 ------------ Total Rights, Warrants and Certificates (Cost $28,557) 150,310 PRINCIPAL AMOUNT(1) - --------------------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT - 16.9% - --------------------------------------------------------------------------------------------------------------------------------- Repurchase agreement with J. P. Morgan Securities, Inc., 5.45%, dated 6/28/96, to be repurchased at $71,332,382 on 7/1/96, collateralized by U.S. Treasury Bonds, 11.25%, 2/15/15, with a value of $66,574,086, and U.S. Treasury Nts., 8.50%, 5/15/97, with a value of $6,696,244 (Cost $71,300,000) $71,300,000 71,300,000 ------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $373,134,359) 100.0% 421,715,693 ------------------------------------------------------------------------------------------------------------------------- OTHER ASSETS NET OF LIABILITIES 0.0 210,621 ------------------ ------------- NET ASSETS 100.0% $421,926,314 ================== =============
47 65 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued) - -------------------------------------------------------------------------------- 1. Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: AUD - Australian Dollar ITL - Italian Lira CAD - Canadian Dollar MXP - Mexican Peso DKK - Danish Krone NZD - New Zealand Dollar FRF - French Franc PLZ - Polish Zloty GBP - British Pound Sterling ZAR - South African Rand 2. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 3. Interest or dividend is paid in kind. 4. Represents the current interest rate for a variable rate security. 5. Represents the current interest rate for an increasing rate security. 6. Denotes a step bond: a zero coupon bond that converts to a fixed rate of interest at a designated future date. 7. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $2,792,177 or 0.66% of the Fund's net assets, at June 30, 1996. 8. Non-income producing security. 9. Identifies issues considered to be illiquid - See applicable note of Notes to Financial Statements. 48 66 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Statement of Investments (Continued) - -------------------------------------------------------------------------------- 10. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows:
SHARES SUBJECT EXPIRATION EXERCISE PREMIUM MARKET VALUE TO CALL DATE PRICE RECEIVED (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------------- Airborne Freight Corp. 13,000 8/96 $ 30 $ 22,645 $ 3,250 Airtouch Communications, Inc. 10,000 7/96 35 14,190 625 American Re Corp. 9,600 7/96 45 17,711 12,600 Bay Networks, Inc. 10,000 9/96 35 43,449 6,875 Burlington Northern Santa Fe Corp. 2,600 7/96 85 9,997 1,625 Cardinal Health, Inc. 10,200 7/96 18 16,268 119,850 Chase Manhattan Corp. (New) 11,600 9/96 70 46,050 60,900 Circus Circus Enterprises, Inc. 6,800 9/96 33 21,045 64,600 Citicorp 2,600 7/96 75 8,697 19,825 Computer Associates International, Inc. 5,600 7/96 75 22,623 5,600 ECI Telecommunications Ltd. 11,900 8/96 30 19,830 2,975 Eastman Kodak Co. 3,600 7/96 75 14,742 13,500 Ecolab, Inc. 2,500 7/96 35 2,987 781 General Electric Co. 3,600 9/96 80 11,142 28,800 General Motors Corp., Cl. H 3,200 9/96 65 12,304 6,000 Genzyme Corp. 4,200 7/96 80 21,528 263 Gymboree Corp. 6,400 7/96 20 9,408 69,600 H & R Block, Inc. 10,000 7/96 40 20,529 625 Harnischfeger Industries, Inc. 10,600 8/96 35 48,955 9,275 Harnischfeger Industries, Inc. 5,200 8/96 40 5,694 1,300 IBP, Inc. 31,500 11/96 25 69,928 110,250 Informix Corp. 19,000 8/96 35 84,927 2,375 International Business Machines Corp. 3,000 7/96 12 14,160 375 Kerr-McGee Corp. 2,400 7/96 70 2,478 600 King World Productions, Inc. 9,000 8/96 45 15,479 2,250 LSI Logic Corp. 6,000 7/96 35 19,319 750 LSI Logic Corp. 6,000 7/96 45 15,194 375 Manor Care, Inc. 4,800 7/96 45 4,656 600 Procter & Gamble Co. 2,400 7/96 95 4,578 900 Rockwell International Corp. 3,400 7/96 65 8,823 425 Sara Lee Corp. 10,000 7/96 35 13,449 625 Storage Technology Corp. (New) 13,100 9/96 23 60,194 211,237 Sun Microsystems, Inc. 7,000 7/96 48 56,331 84,000 Tenneco, Inc. 5,200 8/96 60 7,644 975 Total SA, Sponsored ADR 4,400 8/96 40 4,268 2,475 U.S. Healthcare, Inc. 4,000 7/96 55 5,380 2,500 Wellpoint Health Networks, Inc. 9,000 7/96 40 9,162 2,250 Whitman Corp. 10,000 9/96 25 9,700 7,500 Xerox Corp. 5,100 7/96 50 13,973 20,400 --------------- --------------- $ 809,437 $ 879,731 =============== ===============
11. 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. See accompanying Notes to Financial Statements. 49 67 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - -------------------------------------------------------------------------------------------------- FOREIGN GOVERNMENT OBLIGATIONS - 0.9% - -------------------------------------------------------------------------------------------------- Bonos de la Tesoreria de la Federacion, Zero Coupon, (2) MXP 41,760,000 $ 4,379,166 36.916%, 4/3/97 (Cost $4,362,431) SHARES - -------------------------------------------------------------------------------------------------- COMMON STOCKS - 95.3% - -------------------------------------------------------------------------------------------------- BASIC MATERIALS - 4.9% - -------------------------------------------------------------------------------------------------- CHEMICALS - 1.1% --------------------------------------------------------------------------------------------- Hoechst AG 50,000 1,688,413 --------------------------------------------------------------------------------------------- Minerals Technologies, Inc. 100,000 3,425,000 ------------ 5,113,413 - -------------------------------------------------------------------------------------------------- GOLD - 2.3% --------------------------------------------------------------------------------------------- Anglo American Corp. of South Africa Ltd., ADR 30,000 1,897,500 --------------------------------------------------------------------------------------------- Free State Consolidated Gold Mines Ltd., ADR 174,000 1,609,500 --------------------------------------------------------------------------------------------- Homestake Mining Co. 80,000 1,370,000 --------------------------------------------------------------------------------------------- Newmont Mining Corp. 80,500 3,974,688 --------------------------------------------------------------------------------------------- Placer Dome, Inc. 100,000 2,387,500 ------------ 11,239,188 - -------------------------------------------------------------------------------------------------- METALS - 1.5% --------------------------------------------------------------------------------------------- Companhia Vale Do Rio Doce, Preference 92,000 1,782,173 --------------------------------------------------------------------------------------------- Compania de Minas Buenaventura SA, Sponsored ADR (3) 46,000 914,250 --------------------------------------------------------------------------------------------- Freeport-McMoRan Copper & Gold, Inc., Cl. B 107,000 3,410,625 --------------------------------------------------------------------------------------------- Gencor Ltd., Unsponsored ADR 250,000 923,700 ------------ 7,030,748 - -------------------------------------------------------------------------------------------------- CONSUMER CYCLICALS - 13.5% - -------------------------------------------------------------------------------------------------- AUTOS & HOUSING - 2.4% --------------------------------------------------------------------------------------------- Autobacs Seven Co. Ltd. 23,000 2,222,800 --------------------------------------------------------------------------------------------- IRSA Inversiones y Representaciones, SA 1,028,807 3,502,904 --------------------------------------------------------------------------------------------- Mahindra & Mahindra Ltd., GDR (4) 200,000 2,150,000 --------------------------------------------------------------------------------------------- Volkswagen AG 10,000 3,721,736 ------------ 11,597,440 - -------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT - 0.7% --------------------------------------------------------------------------------------------- Lusomundo SGPS SA 205,200 1,271,573 --------------------------------------------------------------------------------------------- Resorts World Berhad 350,000 2,005,821 ------------ 3,277,394 - -------------------------------------------------------------------------------------------------- MEDIA - 2.4% --------------------------------------------------------------------------------------------- Grupo Televisa SA, Sponsored ADR (4) 64,900 1,995,675 --------------------------------------------------------------------------------------------- News Corp. Ltd., ADR 150,000 3,525,000 --------------------------------------------------------------------------------------------- Reuters Holdings PLC, Series B, ADR 20,000 1,450,000 --------------------------------------------------------------------------------------------- Tele-Communications, Inc. (New), TCI Group, Series A (3) 162,000 2,936,250 --------------------------------------------------------------------------------------------- Time Warner, Inc. 45,000 1,766,250 ------------ 11,673,175 - -------------------------------------------------------------------------------------------------- RETAIL: GENERAL - 0.2% --------------------------------------------------------------------------------------------- PT Matahari Putra Prima 439,500 802,550 - -------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY - 7.8% --------------------------------------------------------------------------------------------- adidas AG 60,000 4,996,259 --------------------------------------------------------------------------------------------- Benetton Group SpA 194,500 2,512,214 --------------------------------------------------------------------------------------------- Cifra SA de CV, Unsponsored ADR, B Shares (3) 1,500,000 2,164,950
50 68 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY (CONTINUED) --------------------------------------------------------------------------------------------- Circuit City Stores, Inc. $ 40,000 $ 1,445,000 --------------------------------------------------------------------------------------------- FamilyMart Co. 49,500 2,202,377 --------------------------------------------------------------------------------------------- Giordano International Ltd. 2,100,000 2,034,750 --------------------------------------------------------------------------------------------- Jusco Co. 85,000 2,782,147 --------------------------------------------------------------------------------------------- Reebok International Ltd. 124,600 4,189,675 --------------------------------------------------------------------------------------------- Wella AG 19,000 11,103,125 --------------------------------------------------------------------------------------------- Wolford AG 16,400 4,011,083 ------------ 37,441,580 - -------------------------------------------------------------------------------------------------- CONSUMER NON-CYCLICALS - 16.3% - -------------------------------------------------------------------------------------------------- BEVERAGES - 2.7% --------------------------------------------------------------------------------------------- Allied Domecq PLC 274,400 1,931,425 --------------------------------------------------------------------------------------------- Buenos Aires Embotelladora SA, Sponsored ADR 100,300 1,328,975 --------------------------------------------------------------------------------------------- Hellenic Bottling Co., SA 35,000 1,161,592 --------------------------------------------------------------------------------------------- LVMH Moet Hennessy Louis Vuitton 4,700 1,114,724 --------------------------------------------------------------------------------------------- Panamerican Beverages, Inc., Cl. A 71,800 3,213,050 --------------------------------------------------------------------------------------------- South African Breweries Ltd. 150,000 4,399,182 ------------ 13,148,948 - -------------------------------------------------------------------------------------------------- FOOD - 1.0% --------------------------------------------------------------------------------------------- Disco SA, ADR (3) 93,200 2,062,050 --------------------------------------------------------------------------------------------- Molinos Rio de la Plata SA, Cl. B 205,600 2,213,334 --------------------------------------------------------------------------------------------- Universal Robina Corp. 833,300 445,289 ------------ 4,720,673 - -------------------------------------------------------------------------------------------------- HEALTHCARE/DRUGS - 8.3% --------------------------------------------------------------------------------------------- Amgen, Inc. (3) 100,000 5,400,000 --------------------------------------------------------------------------------------------- Astra AB Free, Series A 200,000 8,831,321 --------------------------------------------------------------------------------------------- BioChem Pharma, Inc. (3) 50,000 1,875,000 --------------------------------------------------------------------------------------------- Ciba-Geigy AG 4,000 4,873,602 --------------------------------------------------------------------------------------------- Eisai Co. Ltd. 100,000 1,887,283 --------------------------------------------------------------------------------------------- Genzyme Corp. (3) 60,000 3,015,000 --------------------------------------------------------------------------------------------- Glaxo Wellcome PLC, Sponsored ADR 150,000 4,012,500 --------------------------------------------------------------------------------------------- Johnson & Johnson 23,000 1,138,500 --------------------------------------------------------------------------------------------- Plant Genetics Systems (3)(5) 89,104 996,496 --------------------------------------------------------------------------------------------- Sanofi SA 60,000 4,496,426 --------------------------------------------------------------------------------------------- Taisho Pharmaceutical Co. 100,000 2,160,802 --------------------------------------------------------------------------------------------- Takeda Chemical Industries Ltd. 83,000 1,468,069 ------------ 40,154,999 - -------------------------------------------------------------------------------------------------- HEALTHCARE/SUPPLIES & SERVICES - 3.3% --------------------------------------------------------------------------------------------- Gehe AG 6,999 4,754,471 --------------------------------------------------------------------------------------------- Rhoen Klinikum AG, Preference, Non-vtg. (3) 17,920 2,066,145 --------------------------------------------------------------------------------------------- United States Surgical Corp. 300,000 9,300,000 ------------ 16,120,616 - -------------------------------------------------------------------------------------------------- TOBACCO - 1.0% --------------------------------------------------------------------------------------------- B.A.T. Industries PLC 600,000 4,670,726 - -------------------------------------------------------------------------------------------------- ENERGY - 6.5% - -------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS - 3.1% --------------------------------------------------------------------------------------------- Baker Hughes, Inc. 80,000 2,630,000 --------------------------------------------------------------------------------------------- Coflexip SA, Sponsored ADR (3) 105,000 1,824,375 --------------------------------------------------------------------------------------------- Global Marine, Inc. (3) 117,500 1,630,313
51 69 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS (CONTINUED) --------------------------------------------------------------------------------------------- Transocean AS (3) $ 292,360 $ 7,583,150 --------------------------------------------------------------------------------------------- Western Atlas, Inc. (3) 19,300 1,124,225 ------------ 14,792,063 - -------------------------------------------------------------------------------------------------- OIL-INTEGRATED - 3.4% --------------------------------------------------------------------------------------------- British Petroleum Co. PLC, ADR 25,000 2,671,875 --------------------------------------------------------------------------------------------- Elf Acquitaine SA 30,000 2,206,256 --------------------------------------------------------------------------------------------- Gulf Canada Resources Ltd. (3) 565,600 2,857,779 --------------------------------------------------------------------------------------------- Norsk Hydro AS 90,000 4,405,563 --------------------------------------------------------------------------------------------- Total SA, B Shares 30,000 2,224,903 --------------------------------------------------------------------------------------------- Unocal Corp. 64,000 2,160,000 ------------ 16,526,376 - -------------------------------------------------------------------------------------------------- FINANCIAL - 14.5% - -------------------------------------------------------------------------------------------------- BANKS - 4.9% --------------------------------------------------------------------------------------------- Banco Bradesco SA, Preference 455,260,951 3,718,063 --------------------------------------------------------------------------------------------- Banco Frances del Rio de la Plata SA, ADR 55,000 1,581,250 --------------------------------------------------------------------------------------------- Banco Latinoamericano de Exportaciones SA, Cl. E 24,800 1,395,000 --------------------------------------------------------------------------------------------- Chase Manhattan Corp. (New) 52,000 3,672,500 --------------------------------------------------------------------------------------------- Citicorp 45,000 3,718,125 --------------------------------------------------------------------------------------------- HSBC Holdings PLC 126,101 1,906,053 --------------------------------------------------------------------------------------------- Korea Exchange Bank 30,000 388,659 --------------------------------------------------------------------------------------------- Northern Trust Corp. 18,700 1,079,925 --------------------------------------------------------------------------------------------- PT Lippo Bank 825,000 1,364,706 --------------------------------------------------------------------------------------------- Standard Chartered Bank PLC (3) 203,000 2,021,853 --------------------------------------------------------------------------------------------- Turkiye Garanti Bankasi (New), ADR (4) 389,250 2,653,011 ------------ 23,499,145 - -------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 3.9% --------------------------------------------------------------------------------------------- ABN Amro Holding NV 70,000 3,756,350 --------------------------------------------------------------------------------------------- American Express Co. 24,500 1,093,313 --------------------------------------------------------------------------------------------- First NIS Regional Fund (4) 180,000 1,890,000 --------------------------------------------------------------------------------------------- ING Groep NV 89,062 2,655,723 --------------------------------------------------------------------------------------------- MBNA Corp. 105,000 2,992,500 --------------------------------------------------------------------------------------------- Merrill Lynch & Co., Inc. 30,000 1,953,750 --------------------------------------------------------------------------------------------- Societe Generale de Paris 35,000 3,848,030 --------------------------------------------------------------------------------------------- Taiwan Fund, Inc. 18,400 441,600 ------------ 18,631,266 - -------------------------------------------------------------------------------------------------- INSURANCE - 5.7% --------------------------------------------------------------------------------------------- American International Group, Inc. 35,000 3,451,875 --------------------------------------------------------------------------------------------- Assicurazioni Generali SpA 150,000 3,459,015 --------------------------------------------------------------------------------------------- Mapfre Vida Seguros 50,000 2,807,874 --------------------------------------------------------------------------------------------- Marschollek, Lautenschlaeger und Partner AG 5,587 5,872,788 --------------------------------------------------------------------------------------------- National Mutual Asia Ltd. 2,634,000 2,313,957 --------------------------------------------------------------------------------------------- Reinsurance Australia Corp. Ltd. 2,283,000 6,648,318 --------------------------------------------------------------------------------------------- Skandia Forsakrings AB 100,000 2,644,875 ------------ 27,198,702 - -------------------------------------------------------------------------------------------------- INDUSTRIAL - 15.8% - -------------------------------------------------------------------------------------------------- ELECTRICAL EQUIPMENT - 1.1% --------------------------------------------------------------------------------------------- Ushio, Inc. 100,000 1,221,719
52 70 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------- ELECTRICAL EQUIPMENT (CONTINUED) --------------------------------------------------------------------------------------------- Yokogawa Electric Corp. $ 425,000 $ 4,262,342 ------------ 5,484,061 - -------------------------------------------------------------------------------------------------- INDUSTRIAL SERVICES - 5.9% --------------------------------------------------------------------------------------------- BIS SA 35,925 3,754,335 --------------------------------------------------------------------------------------------- Boskalis Westminster 150,000 2,680,178 --------------------------------------------------------------------------------------------- Cordiant PLC (3) 1,700,000 2,905,608 --------------------------------------------------------------------------------------------- IHC Caland NV 80,000 3,936,786 --------------------------------------------------------------------------------------------- PT Citra Marga Nusaphala Persada 1,165,500 1,777,726 --------------------------------------------------------------------------------------------- VBH-Vereinigter Baubeschlag Handel AG 24,700 6,490,866 --------------------------------------------------------------------------------------------- WMX Technologies, Inc. 80,000 2,620,000 --------------------------------------------------------------------------------------------- WPP Group PLC 1,200,000 4,008,807 ------------ 28,174,306 - -------------------------------------------------------------------------------------------------- MANUFACTURING - 6.3% --------------------------------------------------------------------------------------------- Bic Corp. 20,000 2,839,889 --------------------------------------------------------------------------------------------- Bobst Bearers AG 2,000 2,884,214 --------------------------------------------------------------------------------------------- Bombardier, Inc., Cl. B 250,000 3,743,720 --------------------------------------------------------------------------------------------- Chargeurs International SA 14,000 625,747 --------------------------------------------------------------------------------------------- Consolidated Electric Power Asia Ltd., ADS 800,000 1,322,911 --------------------------------------------------------------------------------------------- Komatsu Ltd. 398,000 3,918,984 --------------------------------------------------------------------------------------------- Measurex Corp. 63,800 1,866,150 --------------------------------------------------------------------------------------------- Mitsubishi Heavy Industries Ltd. 530,000 4,605,061 --------------------------------------------------------------------------------------------- Pathe SA 14,000 3,285,102 --------------------------------------------------------------------------------------------- Powerscreen International PLC 730,100 5,173,002 ------------ 30,264,780 - -------------------------------------------------------------------------------------------------- TRANSPORTATION - 2.5% --------------------------------------------------------------------------------------------- Brambles Industries Ltd. 180,000 2,504,718 --------------------------------------------------------------------------------------------- East Japan Railway Co. 400 2,096,981 --------------------------------------------------------------------------------------------- Guangshen Railway Co. Ltd., ADS (3) 180,000 3,442,500 --------------------------------------------------------------------------------------------- Kvaerner AS, Series B 97,500 4,119,825 ------------ 12,164,024 - -------------------------------------------------------------------------------------------------- TECHNOLOGY - 16.2% - -------------------------------------------------------------------------------------------------- COMPUTER HARDWARE - 1.9% --------------------------------------------------------------------------------------------- Canon, Inc. 150,000 3,118,120 --------------------------------------------------------------------------------------------- Digital Equipment Corp. (3) 90,000 4,050,000 --------------------------------------------------------------------------------------------- International Business Machines Corp. 20,000 1,980,000 ------------ 9,148,120 - -------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE - 6.4% --------------------------------------------------------------------------------------------- Baan Co. NV (3) 60,000 2,040,000 --------------------------------------------------------------------------------------------- First Data Corp. 87,118 6,936,771 --------------------------------------------------------------------------------------------- Ines Corp. 60,000 1,121,429 --------------------------------------------------------------------------------------------- Microsoft Corp. (3) 35,000 4,204,375 --------------------------------------------------------------------------------------------- Misys PLC 200,000 2,414,607 --------------------------------------------------------------------------------------------- Nintendo Co. Ltd. 191,000 14,209,872 ------------ 30,927,054 - -------------------------------------------------------------------------------------------------- ELECTRONICS - 4.6% --------------------------------------------------------------------------------------------- Advanced Semiconductor Engineering GDR (3) 102,420 934,070 --------------------------------------------------------------------------------------------- Advantest Corp. 33,000 1,308,790 --------------------------------------------------------------------------------------------- General Motors Corp., Cl. H 40,000 2,405,000
53 71 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - -------------------------------------------------------------------------------------------------- ELECTRONICS (CONTINUED) --------------------------------------------------------------------------------------------- Hewlett-Packard Co. $ 20,000 $ 1,992,500 --------------------------------------------------------------------------------------------- Intel Corp. 20,000 1,468,750 --------------------------------------------------------------------------------------------- Keyence Corp. 25,000 3,396,197 --------------------------------------------------------------------------------------------- Rohm Co. 45,000 2,970,419 --------------------------------------------------------------------------------------------- SGS-Thomson Microelectronics NV (3) 129,400 4,642,225 --------------------------------------------------------------------------------------------- Sony Corp. (3) 48,000 3,155,318 ------------ 22,273,269 - -------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 3.3% --------------------------------------------------------------------------------------------- Airtouch Communications, Inc. (3) 70,000 1,977,500 --------------------------------------------------------------------------------------------- Cisco Systems, Inc. (3) 34,600 1,959,225 --------------------------------------------------------------------------------------------- Korea Mobile Telecommunications Corp. 3,000 3,751,600 --------------------------------------------------------------------------------------------- Millicom International Cellular SA (3) 90,000 4,286,250 --------------------------------------------------------------------------------------------- Millicom, Inc. (3) 25,000 -- --------------------------------------------------------------------------------------------- Petersburg Long Distance, Inc. (3) 187,000 1,531,063 --------------------------------------------------------------------------------------------- PT Telekomunikasi Indonesia, ADR 88,000 2,618,000 ------------ 16,123,638 - -------------------------------------------------------------------------------------------------- UTILITIES - 7.6% - -------------------------------------------------------------------------------------------------- ELECTRIC UTILITIES - 1.1% --------------------------------------------------------------------------------------------- Empresa Nacional de Electricidad SA 30,000 1,869,576 --------------------------------------------------------------------------------------------- Veba AG 60,000 3,188,933 ------------ 5,058,509 - -------------------------------------------------------------------------------------------------- TELEPHONE UTILITIES - 6.5% --------------------------------------------------------------------------------------------- Compania de Telecommunicaciones de Chile SA, Sponsored ADR 31,500 3,090,938 --------------------------------------------------------------------------------------------- CPT Telefonica del Peru SA, Cl. B 3,400,031 6,851,773 --------------------------------------------------------------------------------------------- DDI Corp. 600 5,229,688 --------------------------------------------------------------------------------------------- Portugal Telecom SA 144,000 3,761,396 --------------------------------------------------------------------------------------------- Telecom Italia Mobile SpA 2,000,000 4,468,506 --------------------------------------------------------------------------------------------- Telecom Italia SpA 2,000,000 4,298,898 --------------------------------------------------------------------------------------------- Telecomunicacoes Brasileiras SA, Preference 52,548,000 3,668,738 ------------ 31,369,937 ------------ Total Common Stocks (Cost $408,154,263) 458,626,700 UNITS - -------------------------------------------------------------------------------------------------- RIGHTS, WARRANTS AND CERTIFICATES - 0.0% - -------------------------------------------------------------------------------------------------- American Satellite Network, Inc. Wts., Exp. 6/99 6,250 -- --------------------------------------------------------------------------------------------- Plant Genetics Systems Wts., Exp. 12/99 (5) 60,000 112,128 ------------ Total Rights, Warrants and Certificates (Cost $0) 112,128
54 72 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) (NOTE 1) - --------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT - 3.7% - --------------------------------------------------------------------------------------------------------------- Repurchase agreement with Canadian Imperial Bank of Commerce, 5.45%, dated 6/28/96, to be repurchased at $17,908,130 on 7/1/96, collateralized by U.S. Treasury Bonds, 9.125%-11.25%, 2/15/15-5/11/18, with a value of $6,327,433, and U.S. Treasury Nts., 5.25%-8.50%, 1/11/97-11/15/04, with a value of $11,958,003 (Cost $17,900,000) $17,900,000 $ 17,900,000 ---------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $430,416,694) 99.9% 481,017,994 ---------------------------------------------------------------------------------------------------------- OTHER ASSETS NET OF LIABILITIES 0.1 325,182 ----------- ------------ NET ASSETS 100.0% $481,343,176 =========== ============
1. Principal amount is reported in U.S. Dollars, except for those denoted in the following currency: MXP - Mexican Peso 2. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 3. Non-income producing security. 4. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $8,688,686 or 1.81% of the Fund's net assets, at June 30, 1996. 5. Identifies issues considered to be illiquid - See applicable note of Notes to Financial Statements. Affiliated company. Represents ownership of at least 5% of the voting securities of the issuer and is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended June 30, 1996. There were no affiliate securities held as of June 30, 1996. Transactions during the period in which the issuer was an affiliate are as follows:
BALANCE BALANCE DECEMBER 31, 1995 GROSS ADDITIONS GROSS REDUCTIONS JUNE 30, 1996 DIVIDEND ------------------------------------- ----------------- -------------- SHARES COST SHARES COST SHARES COST SHARES COST INCOME - ------------------------------------------------------------------------------------------------------------ Pharmavit GDS 114,000 $1,401,000 -- $ -- 114,000 $1,401,000 -- $ -- $ --
55 73 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Statement of Investments (Continued) - -------------------------------------------------------------------------------- Distribution of investments by country of issue, as a percentage of total investments at value, is as follows:
COUNTRY MARKET VALUE PERCENT ----------------------------------------------------- United States $207,640,602 43.2% ---------------------------------------------------- Japan 63,338,400 13.2 ---------------------------------------------------- Germany 43,882,737 9.1 ---------------------------------------------------- Great Britain 31,260,402 6.5 ---------------------------------------------------- France 30,862,012 6.4 ---------------------------------------------------- Italy 14,738,633 3.1 ---------------------------------------------------- Australia 12,678,036 2.6 ---------------------------------------------------- Mexico 11,752,841 2.4 ---------------------------------------------------- Canada 10,863,999 2.3 ---------------------------------------------------- Argentina 10,688,513 2.2 ---------------------------------------------------- Brazil 9,168,974 1.9 ---------------------------------------------------- Hong Kong 7,577,671 1.6 ---------------------------------------------------- Indonesia 6,562,982 1.4 ---------------------------------------------------- Korea, Republic of (South) 4,140,259 0.9 ---------------------------------------------------- Austria 4,011,083 0.8 ---------------------------------------------------- China 3,442,500 0.7 ---------------------------------------------------- Chile 3,090,935 0.6 ---------------------------------------------------- India 2,150,000 0.5 ---------------------------------------------------- Malaysia 2,005,823 0.4 ---------------------------------------------------- Greece 1,161,592 0.2 ------------ ----- Total $481,017,994 100.0% ============ =====
See accompanying Notes to Financial Statements. 56 74 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------- MORTGAGE-BACKED OBLIGATIONS - 17.8% - ------------------------------------------------------------------------------------------------------------- GOVERNMENT AGENCY - 15.3% - ------------------------------------------------------------------------------------------------------------- FHLMC/FNMA/SPONSORED - 1.8% ------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., Gtd. Multiclass Mtg. Participation Certificates, Series 176, Cl. F, 8.95%, 3/15/20 $ 21,257 $ 21,377 ------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn.: 7.50%, 8/1/25 1,094,148 1,080,209 Collateralized Mtg. Obligations, Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, 10.50%, 11/25/20 130,000 145,518 Series 1994-83, Cl. Z, 7.50%, 6/25/24 185,806 168,503 ------------ 1,415,607 - ------------------------------------------------------------------------------------------------------------- GNMA/GUARANTEED - 13.5% ------------------------------------------------------------------------------------------------------- Government National Mortgage Assn.: 6%, 11/20/25 729,856 733,053 7.50%, 8/15/25 4,946,850 4,883,828 8%, 11/15/25-5/15/26 4,946,550 4,996,016 ------------ 10,612,897 - ------------------------------------------------------------------------------------------------------------- PRIVATE - 2.5% - ------------------------------------------------------------------------------------------------------------- COMMERCIAL - 1.6% ---------------------------------------------------------------------------------------------------- FDIC Trust, Gtd. Real Estate Mtg. Investment Conduit Pass- Through Certificates, Series 1994-C1, Cl. 2-G, 8.70%, 9/25/25 (2) 153,594 155,130 ---------------------------------------------------------------------------------------------------- Merrill Lynch Mortgage Investors, Inc., Mtg. Pass- Through Certificates, Series 1995-C2, Cl. D, 8.266%, 6/15/21(3) 482,223 482,751 ---------------------------------------------------------------------------------------------------- Morgan Stanley Capital I, Inc., Commercial Mtg. Pass- Through Certificates, Series 1996-C1, Cl. F, 7.51%, 2/1/28 (2)(3) 162,744 104,055 ---------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates: Series 1992-CHF, Cl. D, 8.25%, 12/25/20 124,762 125,308 Series 1993-C1, Cl. D, 9.45%, 5/25/24 91,000 93,588 Series 1994-C2, Cl. E, 8%, 4/25/25 228,725 218,183 ---------------------------------------------------------------------------------------------------- Structured Asset Securities Corp., Multiclass Pass-Through Certificates, Series 1995-C4, Cl. E, 8.863%, 6/25/26 (2)(3) 46,290 37,625 --------------- 1,216,640 - ------------------------------------------------------------------------------------------------------------- MULTI-FAMILY - 0.1% ---------------------------------------------------------------------------------------------------- DLJ Mortgage Acceptance Corp., Series 1996-CF1, Cl. B3, 8.269%, 3/13/28 (2) 100,000 78,719 ---------------------------------------------------------------------------------------------------- Resolution Trust Corp., Commercial Mtg. Pass- Through Certificates, Series 1991-M6, Cl. B4, 7.145%, 6/25/21 (3) 37,075 35,731 --------------- 114,450 - ------------------------------------------------------------------------------------------------------------- RESIDENTIAL - 0.8% ---------------------------------------------------------------------------------------------------- Mortgage Capital Funding, Inc., Multifamily Mortgage Pass- Through Certificates, Series 1996-MC1, Cl. G, 7.15%, 6/15/06 (2)(4) 800,000 598,000 --------------- Total Mortgage-Backed Obligations (Cost $13,909,362) 13,957,594
57 75 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------ U.S. GOVERNMENT OBLIGATIONS - 13.2% - ------------------------------------------------------------------------------------------------------------ U.S. Treasury Bonds: 11.625%, 11/15/02 $ 4,300,000 $ 5,415,313 13.125%, 5/15/01 2,800,000 3,567,373 6.875%, 8/15/25 1,200,000 1,187,624 8.125%, 8/15/19 (13) 163,000 182,866 --------------- Total U.S. Government Obligations (Cost $10,552,685) 10,353,176 - ------------------------------------------------------------------------------------------------------------ FOREIGN GOVERNMENT OBLIGATIONS - 26.3% - ------------------------------------------------------------------------------------------------------------ ARGENTINA - 0.2% - ------------------------------------------------------------------------------------------------------------ Banco Hipotecario Nacional (Argentina) Medium-Term Nts., 10.625%, 3/29/99 (2) 150,000 151,875 - ------------------------------------------------------------------------------------------------------------ AUSTRALIA - 3.8% - ------------------------------------------------------------------------------------------------------------ Australia (Commonwealth of) Bonds, 10%, 10/15/07 AUD 675,000 569,698 --------------------------------------------------------------------------------------------------- Queensland Treasury Corp.: Exchangeable Gtd. Nts., 8%, 8/14/01 AUD 603,000 460,652 Gtd. Nts., 8%, 5/14/03 AUD 610,000 456,971 --------------------------------------------------------------------------------------------------- Treasury Corp. of Victoria Gtd. Bonds: 10.25%, 11/15/06 AUD 665,000 561,164 12.50%, 10/15/03 AUD 485,000 452,748 --------------------------------------------------------------------------------------------------- Western Australia Treasury Corp. Gtd. Bonds, 10%, 7/15/05 AUD 450,000 372,439 -------------- 2,873,672 - ------------------------------------------------------------------------------------------------------------ BRAZIL - 1.5% - ------------------------------------------------------------------------------------------------------------ Banco Estado Minas Gerais, 8.25%, 2/10/00 250,000 228,750 --------------------------------------------------------------------------------------------------- Brazil (Federal Republic of): Capitalization Bonds, 8%, 4/15/14 1,407,159 870,680 Nts., Banco Estado Minas Gerais, 7.875%, 2/10/99 30,000 27,787 --------------------------------------------------------------------------------------------------- Petroquimica do Nordeste Sr. Unsec. Unsub. Nts., 9.50%, 10/19/01 50,000 48,828 ------------------ 1,176,045 - ------------------------------------------------------------------------------------------------------------ BULGARIA - 0.8% - ------------------------------------------------------------------------------------------------------------ Bulgaria (Republic of): Front-Loaded Interest Reduction Bearer Bonds, Tranche A, 2%, 7/28/12 (3) 905,000 301,761 Interest Arrears Bonds, 6.25%, 7/28/11 (3) 720,000 342,000 ------------------- 643,761 - ------------------------------------------------------------------------------------------------------------ CANADA - 2.2% - ------------------------------------------------------------------------------------------------------------ Canada (Government of) Bonds: 10.25%, 12/1/98 CAD 830,000 662,179 9%, 12/1/04 CAD 680,000 543,618 Series A33, 11.50%, 9/1/00 CAD 610,000 521,566 ------------------- 1,727,363 - ------------------------------------------------------------------------------------------------------------ COSTA RICA - 0.3% - ------------------------------------------------------------------------------------------------------------ Central Bank of Costa Rica Interest Claim Bonds, Series B, 6.328%, 5/21/05 (3) 262,123 242,464
58 76 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------ FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED) - ------------------------------------------------------------------------------------------------------------ CZECH REPUBLIC - 0.5% - ------------------------------------------------------------------------------------------------------------ CEZ AS, Zero Coupon Disc. Promissory Nts., 10.768%, 7/1/96 (5) CZK 10,000,000 $ 363,238 - ------------------------------------------------------------------------------------------------------------ ECUADOR - 0.3% - ------------------------------------------------------------------------------------------------------------ Ecuador (Republic of): Disc. Bonds, 6.063%, 2/28/25 (3) 190,000 107,825 Interest Equalization Bearer Bonds, 6.625%, 12/21/04 (3) 185,000 135,512 --------------- 243,337 - ------------------------------------------------------------------------------------------------------------- FINLAND - 1.3% - ------------------------------------------------------------------------------------------------------------- Finland (Republic of) Bonds, 10%, 9/15/01 FIM 4,000,000 1,003,035 - ------------------------------------------------------------------------------------------------------------- GERMANY - 0.9% - ------------------------------------------------------------------------------------------------------------- Germany (Republic of) Bonds: 7.75%, 10/1/04 DEM 480,000 338,429 Series 86, 6%, 6/20/16 DEM 100,000 58,004 Series 94, 7.50%. 11/11/04 DEM 240,000 167,985 ----------------------------------------------------------------------------------------------------- Landeskreditbank Baden-Wurttemberg Gtd. Bonds, 6%, 1/25/06 DEM 180,000 112,567 ---------------- 676,985 - ------------------------------------------------------------------------------------------------------------- GREAT BRITAIN - 2.2% - ------------------------------------------------------------------------------------------------------------- United Kingdom Treasury: Bonds, 10%, 9/8/03 GBP 500,000 875,227 Debs., 8.50%, 12/7/05 GBP 75,000 121,524 Nts., 10%, 2/26/01 GBP 210,000 360,254 Nts., 12.50%, 11/21/05 GBP 158,000 309,561 Nts., 8%, 6/10/03 GBP 60,000 95,209 ---------------- 1,761,775 - ------------------------------------------------------------------------------------------------------------- ITALY - 1.6% - ------------------------------------------------------------------------------------------------------------- Italy (Republic of) Treasury Bonds, Buoni del Tesoro Poliennali: 11.50%, 3/1/03 ITL 445,000,000 325,008 10.50%, 4/1/00 ITL 490,000,000 338,280 10.50%, 7/15/00 ITL 530,000,000 366,932 10.50%, 7/15/98 ITL 380,000,000 257,605 ---------------- 1,287,825 - ------------------------------------------------------------------------------------------------------------- JAPAN - 0.1% - ------------------------------------------------------------------------------------------------------------- Japan (Government of) Bonds, Series 31, 3.50%, 3/21/16 JPY 12,800,000 112,127 - ------------------------------------------------------------------------------------------------------------- JORDON - 1.0% - ------------------------------------------------------------------------------------------------------------- Hashemite Kingdom of Jordan: Disc. Bonds, 6.625%, 12/23/23 (3) 500,000 351,250 Interest Arrears Bonds, 6.625%, 12/23/05 (3) 500,000 403,750 --------------- 755,000 - ------------------------------------------------------------------------------------------------------------- MEXICO - 1.4% - ------------------------------------------------------- Banco Nacional de Comercio Exterior SNC International Finance BV Gtd. Bonds, 10.758%, 6/23/97 (2)(3) 250,000 258,750 ----------------------------------------------------------------------------------------------------- Bonos de la Tesoreria de la Federacion, Zero Coupon, 37.786%, 3/6/97 (5) MXP 4,200,000 450,102 ----------------------------------------------------------------------------------------------------- United Mexican States: Bonds, 10.375%, 1/29/03 DEM 425,000 285,215
59 77 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------- MEXICO (CONTINUED) - ------------------------------------------------------------------------------------------------------------- Petroleos Mexicanos Gtd. Unsec. Unsub. Nts., 7.875%, 3/2/99 CAD 200,000 $ 144,074 ------------- 1,138,141 - ------------------------------------------------------------------------------------------------------------- NEW ZEALAND - 1.6% - ------------------------------------------------------------------------------------------------------------- New Zealand (Republic of) Bonds: 10%, 3/15/02 NZD 780,000 558,060 10%, 7/15/97 NZD 1,045,000 719,166 -------------- 1,277,226 - ------------------------------------------------------------------------------------------------------------- PANAMA - 0.4% - ------------------------------------------------------------------------------------------------------------- Panama (Republic of): Debs., 6.629%, 5/10/02 (3) 230,770 216,924 Past Due Interest Debs., 12/29/49 (4) 125,000 76,602 --------------- 293,526 - ------------------------------------------------------------------------------------------------------------- POLAND - 0.9% - ------------------------------------------------------------------------------------------------------------- Poland (Republic of) Treasury Bills, Zero Coupon: 21.464%, 10/16/96 (5) PLZ 500,000 173,205 21.641%, 10/2/96 (5) PLZ 720,000 251,334 21.463%, 8/12/96 (5) PLZ 800,000 287,394 -------------- 711,933 - ------------------------------------------------------------------------------------------------------------- SPAIN - 1.7% - ------------------------------------------------------------------------------------------------------------- Spain (Kingdom of): Bonds, Bonos y Obligacion del Estado, 10.15%, 1/31/06 ESP 114,000,000 959,235 Bonds, Bonos y Obligacion del Estado, 10.90%, 8/30/03 ESP 26,600,000 231,996 Gtd. Bonds, Bonos y Obligacion del Estado, 11.45%, 8/30/98 ESP 22,000,000 181,124 ---------------- 1,372,355 - ------------------------------------------------------------------------------------------------------------- SUPRANATIONAL - 0.7% - ------------------------------------------------------------------------------------------------------------- European Bank for Reconstruction & Development Sr. Unsec. Medium-Term Nts., 10%, 12/20/96 CZK 10,000,000 357,940 -------------------------------------------------------------------------------------------------------- International Bank for Reconstruction & Development Bonds, 12.50%, 7/25/97 NZD 325,000 229,061 ----------------- 587,001 - ------------------------------------------------------------------------------------------------------------- SWEDEN - 2.4% - ------------------------------------------------------------------------------------------------------------- Sweden (Kingdom of) Bonds: Series 1030, 13%, 6/15/01 SEK 5,500,000 1,013,511 Series 1033, 10.25%, 5/5/03 SEK 3,500,000 591,107 Series 1035, 6%, 2/9/05 SEK 2,100,000 274,332 ---------------- 1,878,950 - ------------------------------------------------------------------------------------------------------------- VENEZUELA - 0.5% - ------------------------------------------------------------------------------------------------------------- Venezuela (Republic of): Disc. Bonds, Series DL, 6.625%, 12/18/07 (3) 500,000 353,750 Front-Loaded Interest Reduction Bonds, Series A, 6.375%, 3/31/07 (3) 100,000 72,375 -------------- 426,125 -------------- Total Foreign Government Obligations (Cost $20,411,350) 20,703,759
60 78 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------- LOAN PARTICIPATIONS - 2.8% - ------------------------------------------------------------------------------------------------------------- Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A, 6.812%, 9/4/06 (3)(6) $1,300,000 $ 775,937 ---------------------------------------------------------------------------------------------------- Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 (3)(6) 235,740 219,827 ---------------------------------------------------------------------------------------------------- Jamaica (Government of) 1990 Refinancing Agreement Nts.: Tranche A, 6.344%, 10/16/00 (3)(6) 75,000 71,812 Tranche B, 6.312%, 11/15/04 (3)(6) 150,000 117,375 ---------------------------------------------------------------------------------------------------- Morocco (Kingdom of) Loan Participation Agreement: Tranche A, 6.437%, 1/1/09 (3) 530,000 381,766 Tranche B, 6.437%, 1/1/04 (3) 47,058 37,765 --------------------------------------------------------------------------------------------------- Pulsar Internacional SA de CV, 11.80% Nts., 9/19/96 (6) 250,000 251,250 ---------------------------------------------------------------------------------------------------- Trinidad & Tobago Loan Participation Agreement, Tranche A, 1.772%, 9/30/00 (3)(6)JPY35,999,998 280,631 ---------------------------------------------------------------------------------------------------- United Mexican States, Combined Facility 3, Loan Participation Agreement, Tranche A, 6.563%, 9/20/97 (3)(6) 85,760 71,610 --------------- Total Loan Participations (Cost $2,173,204) 2,207,973 - ------------------------------------------------------------------------------------------------------------- CORPORATE BONDS AND NOTES - 28.9% - ------------------------------------------------------------------------------------------------------------- BASIC INDUSTRY - 2.4% - ------------------------------------------------------------------------------------------------------------- CHEMICALS - 0.5% ---------------------------------------------------------------------------------------------------- NL Industries, Inc.: 0%/13% Sr. Sec. Disc. Nts., 10/15/05 (7) 200,000 157,000 11.75% Sr. Sec. Nts., 10/15/03 100,000 102,500 ---------------------------------------------------------------------------------------------------- Texas Petrochemicals Corp., 11.125% Sr. Sub. Nts., 7/1/06 (2)(4) 100,000 102,031 -------------- 361,531 - ------------------------------------------------------------------------------------------------------------ METALS/MINING - 0.0% ----------------------------------------------------------------------------------------------------- UCAR Global Enterprises, Inc., 12% Sr. Sub. Nts., 1/15/05 10,000 11,400 - ------------------------------------------------------------------------------------------------------------ PAPER - 1.4% ---------------------------------------------------------------------------------------------------- Domtar, Inc., 11.25% Debs., 9/15/17 100,000 106,750 ---------------------------------------------------------------------------------------------------- Florida Coast Paper Co. LLC/Florida Coast Paper Finance Corp., 12.75% First Mtg. Nts., 6/1/03 (2) 130,000 135,200 ---------------------------------------------------------------------------------------------------- Indah Kiat International Finance Co. BV, 12.50% Sr. Sec. Gtd. Nts., Series C, 6/15/06 250,000 266,875 ---------------------------------------------------------------------------------------------------- Riverwood International Corp., 10.25% Sr. Nts., 4/1/06 400,000 399,000 ---------------------------------------------------------------------------------------------------- Stone Container Corp., 10.75% First Mtg. Nts., 10/1/02 190,000 192,850 -------------- 1,100,675 - ------------------------------------------------------------------------------------------------------------ STEEL - 0.5% ---------------------------------------------------------------------------------------------------- Jorgensen (Earle M.) Co., 10.75% Sr. Nts., 3/1/00 50,000 49,500 ---------------------------------------------------------------------------------------------------- Republic Engineered Steels, Inc., 9.875% First Mtg. Nts., 12/15/01 250,000 234,375 ---------------------------------------------------------------------------------------------------- Wheel-Pittsburgh Corp., 9.375% Sr. Nts., 11/15/03 150,000 139,875 -------------- 423,750 - ------------------------------------------------------------------------------------------------------------ CONSUMER RELATED - 6.1% - ------------------------------------------------------------------------------------------------------------ CONSUMER PRODUCTS - 1.0% ---------------------------------------------------------------------------------------------------- Coleman Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts., Series B, 12.575%, 5/27/98 (5) 50,000 42,125
61 79 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------- CONSUMER PRODUCTS (CONTINUED) --------------------------------------------------------------------------------------------------------- Harman International Industries, Inc., 12% Sr. Sub. Nts., 8/1/02 $ 150,000 $ 164,250 --------------------------------------------------------------------------------------------------------- International Semi-Tech Microelectronics, Inc., 0%/11.50% Sr. Sec. Disc. Nts., 8/15/03 (7) 400,000 238,000 --------------------------------------------------------------------------------------------------------- TAG Heuer International SA, 12% Sr. Sub. Nts., 12/15/05 (2) 200,000 209,500 --------------------------------------------------------------------------------------------------------- Williams (J. B.) Holdings, Inc., 12% Sr. Nts., 3/1/04 100,000 98,750 --------------- 752,625 - ------------------------------------------------------------------------------------------------------------- FOOD/BEVERAGES/TOBACCO - 0.8% --------------------------------------------------------------------------------------------------------- Dr. Pepper Bottling Holdings, Inc., 0%/11.625% Sr. Disc. Nts., 2/15/03 (7) 200,000 167,000 --------------------------------------------------------------------------------------------------------- Unilever CR spol. s.r.o., guaranteed by Unilever NV, Rotterdam, The Netherlands, Zero Coupon Promissory Nts., 11.184%, 10/11/96 (5) CZK 14,000,000 493,278 ---------------- 660,278 - ------------------------------------------------------------------------------------------------------------- HEALTHCARE - 0.9% --------------------------------------------------------------------------------------------------------- Capstone Capital Corp., 10.50% Cv. Sub. Debs., 4/1/02 200,000 255,000 --------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc., 13% Sr. Sub. Nts., 7/15/02 200,000 223,000 --------------------------------------------------------------------------------------------------------- Total Renal Care, Inc., 0%/12% Sr. Sub. Disc. Nts., 8/15/04 (7) 205,000 200,900 -------------- 678,900 - ------------------------------------------------------------------------------------------------------------- HOTEL/GAMING - 2.1% --------------------------------------------------------------------------------------------------------- Grand Casinos, Inc., 10.125% Gtd. First Mtg. Nts., 12/1/03 250,000 258,750 --------------------------------------------------------------------------------------------------------- HMC Acquisition Properties, Inc., 9% Sr. Nts., 12/15/07 150,000 138,375 --------------------------------------------------------------------------------------------------------- Majestic Star Casino LLC (The), 12.75% Sr. Sec. Nts., 5/15/03 (2) 100,000 108,500 --------------------------------------------------------------------------------------------------------- Mohegan Tribal Gaming Authority, 13.50% Sr. Sec. Nts., 11/15/02 (2) 100,000 126,000 --------------------------------------------------------------------------------------------------------- Players International, Inc., 10.875% Sr. Nts., 4/15/05 150,000 152,625 --------------------------------------------------------------------------------------------------------- Showboat Marina Casino Partnership/Showboat Marina Finance Corp., 13.50% First Mtg. Nts., 3/15/03 (2) 150,000 162,000 --------------------------------------------------------------------------------------------------------- Station Casinos, Inc., 9.625% Sr. Sub. Nts., 6/1/03 100,000 98,500 --------------------------------------------------------------------------------------------------------- Trump Atlantic City Associates/Trump Atlantic City Funding, Inc., 11.25% First Mtg. Nts., 5/1/06 600,000 606,000 -------------- 1,650,750 - ------------------------------------------------------------------------------------------------------------- RESTAURANTS - 0.6% --------------------------------------------------------------------------------------------------------- Carrols Corp., 11.50% Sr. Nts., 8/15/03 100,000 102,000 --------------------------------------------------------------------------------------------------------- Foodmaker, Inc.: 9.25% Sr. Nts., 3/1/99 100,000 98,750 9.75% Sr. Sub. Nts., 6/1/02 300,000 289,500 -------------- 490,250 - ------------------------------------------------------------------------------------------------------------- TEXTILE/APPAREL - 0.7% --------------------------------------------------------------------------------------------------------- Clark-Schwebel, Inc., 10.50% Sr. Nts., 4/15/06 (2) 100,000 102,500 --------------------------------------------------------------------------------------------------------- PT Polysindo Eka Perkasa, Zero Coupon Promissory Nts.: 17.90%, 10/23/96 (5) IDR 300,000,000 121,455 19.348%, 4/29/97 (5) IDR 560,000,000 205,339 --------------------------------------------------------------------------------------------------------- Synthetic Industries, Inc., 12.75% Sr. Sub. Debs., 12/1/02 100,000 106,250 -------------- 535,544 - ------------------------------------------------------------------------------------------------------------- ENERGY - 1.9% - ------------------------------------------------------------------------------------------------------------- Chesapeake Energy Corp., 10.50% Sr. Nts., 6/1/02 150,000 157,500
62 80 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------------------------ ENERGY (CONTINUED) - ------------------------------------------------------------------------------------------------------------------------------ Falcon Drilling, Inc., 8.875% Sr. Nts., Series B, 3/15/03 $ 200,000 $ 193,250 ------------------------------------------------------------------------------------------------------------------------- Mesa Operating Co., 10.625% Gtd. Sr. Sub. Nts., 7/1/06 (4) 250,000 253,906 ------------------------------------------------------------------------------------------------------------------------- Petroleum Heat & Power Co., Inc.: 12.25% Sub. Debs., 2/1/05 64,000 70,720 9.375% Sub. Debs., 2/1/06 200,000 189,000 ------------------------------------------------------------------------------------------------------------------------- Plains Resources, Inc., 10.25% Sr. Sub. Nts., 3/15/06 (2) 200,000 200,000 ------------------------------------------------------------------------------------------------------------------------- Triton Energy Corp., Zero Coupon Sr. Sub. Disc. Nts., 10.493%, 11/1/97 (5) 100,000 90,500 ------------------------------------------------------------------------------------------------------------------------- United Meridian Corp., 10.375% Sr. Sub. Nts., 10/15/05 200,000 205,750 ------------------------------------------------------------------------------------------------------------------------- Vintage Petroleum, Inc., 9% Sr. Sub. Nts., 12/15/05 100,000 94,500 --------- 1,455,126 - ------------------------------------------------------------------------------------------------------------------------------ FINANCIAL SERVICES - 3.0% - ------------------------------------------------------------------------------------------------------------------------------ BANKS & THRIFTS - 2.0% ------------------------------------------------------------------------------------------------------------------------- Banco Bamerindus do Brasil SA: 10.50% Debs., 6/23/97 100,000 96,750 11% Sr. Unsub. Unsec. Bonds, 10/6/97 100,000 96,750 ------------------------------------------------------------------------------------------------------------------------- Banco Ganadero SA, Zero Coupon Nts., 9.931%, 7/1/96 (2)(5) 100,000 100,000 ------------------------------------------------------------------------------------------------------------------------- Banco Mexicano SA, 8% Sr. Unsub. Unsec. Exchangeable Medium-Term Nts., 11/4/98 200,000 190,000 ------------------------------------------------------------------------------------------------------------------------- First Nationwide (Parent) Holdings, Inc., 12.50% Sr. Nts., 4/15/03 200,000 209,500 ------------------------------------------------------------------------------------------------------------------------- PT Hutama Karya, Zero Coupon Medium-Term Nts., 17.514%, 3/19/97 IDR 400,000,000 152,578 ------------------------------------------------------------------------------------------------------------------------- PT Inti Indorayon Utama, Zero Coupon Promissory Nts., 22.098%, 2/12/97 (5) IDR 1,400,000,000 543,688 ------------------------------------------------------------------------------------------------------------------------- Transpower Finance Ltd., 8% Gtd. Unsec. Unsub. Bonds: 2/15/01 (6) NZD 125,000 80,952 3/15/02 NZD 125,000 81,007 --------- 1,551,225 - ------------------------------------------------------------------------------------------------------------------------------ DIVERSIFIED FINANCIAL - 0.9% ------------------------------------------------------------------------------------------------------------------------- Banco del Atlantico SA, 7.875% Eurobonds, 11/5/98 320,000 301,200 ------------------------------------------------------------------------------------------------------------------------- GPA Delaware, Inc., 8.75% Gtd. Nts., 12/15/98 300,000 300,000 ------------------------------------------------------------------------------------------------------------------------- Olympic Financial Ltd., 13% Sr. Nts., 5/1/00 100,000 108,000 --------- 709,200 - ------------------------------------------------------------------------------------------------------------------------------ INSURANCE - 0.1% ------------------------------------------------------------------------------------------------------------------------- Terra Nova Insurance (UK) Holdings PLC, 10.75% Sr. Nts., 7/1/05 100,000 111,500 - ------------------------------------------------------------------------------------------------------------------------------ HOUSING RELATED - 0.5% - ------------------------------------------------------------------------------------------------------------------------------ BUILDING MATERIALS - 0.1% ------------------------------------------------------------------------------------------------------------------------- Pacific Lumber Co., 10.50% Sr. Nts., 3/1/03 100,000 97,750 - ------------------------------------------------------------------------------------------------------------------------------ HOMEBUILDERS/REAL ESTATE - 0.4% ------------------------------------------------------------------------------------------------------------------------- Saul (B.F.) Real Estate Investment Trust, 11.625% Sr. Sec Nts., Series B, 4/1/02 100,000 103,000 ------------------------------------------------------------------------------------------------------------------------- Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11 (2) 250,000 190,000 --------- 293,000
63 81 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - --------------------------------------------------------------------------------------------------------------------- MANUFACTURING - 0.8% - --------------------------------------------------------------------------------------------------------------------- AEROSPACE/ELECTRONICS/COMPUTERS - 0.5% ---------------------------------------------------------------------------------------------------------------- Communications & Power Industries, Inc., 12% Sr. Sub. Nts., 8/1/05 $ 200,000 $ 212,500 ---------------------------------------------------------------------------------------------------------------- Rohr, Inc., 11.625% Sr. Nts., 5/15/03 100,000 110,500 ---------------------------------------------------------------------------------------------------------------- Unisys Corp., 15% Credit Sensitive Nts., 7/1/97 (3) 50,000 53,375 ---------- 376,375 - --------------------------------------------------------------------------------------------------------------------- AUTOMOTIVE - 0.3% ---------------------------------------------------------------------------------------------------------------- Foamex LP/Foamex Capital Corp., 11.25% Sr. Nts., 10/1/02 100,000 103,500 ---------------------------------------------------------------------------------------------------------------- Penda Corp., 10.75% Sr. Nts., Series B, 3/1/04 150,000 140,250 ---------- 243,750 - --------------------------------------------------------------------------------------------------------------------- MEDIA - 5.6% - --------------------------------------------------------------------------------------------------------------------- BROADCASTING - 1.3% ---------------------------------------------------------------------------------------------------------------- Argyle Television, Inc., 9.75% Sr. Sub. Nts., 11/1/05 100,000 94,250 ---------------------------------------------------------------------------------------------------------------- New City Communications, Inc., 11.375% Sr. Sub. Nts., 11/1/03 50,000 55,250 ---------------------------------------------------------------------------------------------------------------- Paxson Communications Corp., 11.625% Sr. Sub. Nts., 10/1/02 250,000 261,250 ---------------------------------------------------------------------------------------------------------------- SFX Broadcasting, Inc., 10.75% Sr. Sub. Nts., 5/15/06 (2) 300,000 300,000 ---------------------------------------------------------------------------------------------------------------- Sinclair Broadcast Group, Inc., 10% Sr. Sub. Nts., 12/15/03 100,000 96,500 ---------------------------------------------------------------------------------------------------------------- Young Broadcasting, Inc., 9% Sr. Sub. Nts., 1/15/06 200,000 179,000 ---------- 986,250 - --------------------------------------------------------------------------------------------------------------------- CABLE TELEVISION - 3.1% ---------------------------------------------------------------------------------------------------------------- American Telecasting, Inc., 0%/14.50% Sr. Disc. Nts., 6/15/04 (7) 322,737 225,916 ---------------------------------------------------------------------------------------------------------------- Australis Media Ltd., Units (each unit consists of $1,000 principal amount of 0%/14% sr. sub. disc. nts., 5/15/03 and one warrant to purchase 57.721 ordinary shares) (7)(8) 600,000 360,000 ---------------------------------------------------------------------------------------------------------------- Bell Cablemedia PLC, 0%/11.95% Sr. Disc. Nts., 7/15/04 (7) 200,000 141,000 ---------------------------------------------------------------------------------------------------------------- Cablevision Systems Corp., 10.75% Sr. Sub. Debs., 4/1/04 100,000 103,500 ---------------------------------------------------------------------------------------------------------------- Continental Cablevision, Inc., 11% Sr. Sub. Debs., 6/1/07 300,000 339,955 ---------------------------------------------------------------------------------------------------------------- EchoStar Communications Corp., 0%/12.875% Sr. Disc. Nts., 6/1/04 (7) 200,000 146,000 ---------------------------------------------------------------------------------------------------------------- Fundy Cable Ltd./Ltee, 11% Sr. Sec. Second Priority Nts., 11/15/05 100,000 101,750 ---------------------------------------------------------------------------------------------------------------- International CableTel, Inc., 0%/11.50% Sr. Deferred Coupon Nts., Series A, 2/1/06 (7) 360,000 203,400 ---------------------------------------------------------------------------------------------------------------- Marcus Cable Operating Co. LP/Marcus Cable Capital Corp., 0%/13.50% Sr. Sub. Gtd. Disc. Nts., Series II, 8/1/04 (7) 200,000 144,000 ---------------------------------------------------------------------------------------------------------------- Rogers Cablesystems Ltd., 10% Sr. Sec. Second Priority Debs., 12/1/07 300,000 293,250 ---------------------------------------------------------------------------------------------------------------- TeleWest PLC, 0%/11% Sr. Disc. Debs., 10/1/07 (7) 200,000 119,000 ---------------------------------------------------------------------------------------------------------------- United International Holdings, Inc., Zero Coupon Sr. Sec Disc. Nts., 12.544%, 11/15/99 (5) 200,000 132,000 ---------------------------------------------------------------------------------------------------------------- Videotron Holdings PLC, 0%/11% Sr. Disc. Nts., 8/15/05 (7) 150,000 98,250 ---------- 2,408,021 - --------------------------------------------------------------------------------------------------------------------- DIVERSIFIED MEDIA - 1.0% ---------------------------------------------------------------------------------------------------------------- Ackerley Communications, Inc., 10.75% Sr. Sec. Nts., Series A, 10/1/03 200,000 208,250
64 82 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - --------------------------------------------------------------------------------------------------------------------- DIVERSIFIED MEDIA (CONTINUED) ---------------------------------------------------------------------------------------------------------------- Lamar Advertising Co., 11% Sr. Sec. Nts., 5/15/03 $ 150,000 $ 154,125 ---------------------------------------------------------------------------------------------------------------- Outdoor Systems, Inc., 10.75% Sr. Nts., 8/15/03 100,000 104,000 ---------------------------------------------------------------------------------------------------------------- Panamsat LP/Panamsat Capital Corp., 9.75% Sr. Sec. Nts., 8/1/00 150,000 156,000 ---------------------------------------------------------------------------------------------------------------- Time Warner Entertainment LP/Time Warner, Inc., 8.375% Sr. Debs., 3/15/23 200,000 194,726 --------- 817,101 - --------------------------------------------------------------------------------------------------------------------- ENTERTAINMENT/FILM - 0.2% ---------------------------------------------------------------------------------------------------------------- Imax Corp., 7% Sr. Nts., 3/1/01 (9) 200,000 196,000 - --------------------------------------------------------------------------------------------------------------------- OTHER - 0.4% - --------------------------------------------------------------------------------------------------------------------- CONGLOMERATES - 0.3% ---------------------------------------------------------------------------------------------------------------- MacAndrews & Forbes Holdings, Inc., 13% Sub. Debs., 3/1/99 175,000 172,594 ---------------------------------------------------------------------------------------------------------------- Talley Industries, Inc., 0%/12.25% Sr. Disc. Debs., 10/15/05 (7) 86,000 68,800 --------- 241,394 - --------------------------------------------------------------------------------------------------------------------- SERVICES - 0.1% ---------------------------------------------------------------------------------------------------------------- Borg-Warner Security Corp., 9.125% Sr. Sub. Nts., 5/1/03 100,000 93,750 - --------------------------------------------------------------------------------------------------------------------- RETAIL - 0.8% - --------------------------------------------------------------------------------------------------------------------- SPECIALTY RETAILING - 0.2% ---------------------------------------------------------------------------------------------------------------- Eye Care Centers of America, Inc., 12% Sr. Nts., 10/1/03 70,000 72,450 ---------------------------------------------------------------------------------------------------------------- Finlay Fine Jewelry Corp., 10.625% Sr. Nts., 5/1/03 100,000 100,500 --------- 172,950 - --------------------------------------------------------------------------------------------------------------------- SUPERMARKETS - 0.6% ---------------------------------------------------------------------------------------------------------------- Grand Union Co., 12% Sr. Nts., 9/1/04 200,000 187,750 ---------------------------------------------------------------------------------------------------------------- Purity Supreme, Inc., 11.75% Sr. Sec. Nts., Series B, 8/1/99 100,000 108,125 ---------------------------------------------------------------------------------------------------------------- Ralph's Grocery Co., 10.45% Sr. Nts., 6/15/04 (2) 200,000 192,500 --------- 488,375 - --------------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 0.6% - --------------------------------------------------------------------------------------------------------------------- AIR TRANSPORTATION - 0.4% ---------------------------------------------------------------------------------------------------------------- American International Group, Inc., 11.70% Unsec. Unsub Bonds, 12/4/01 ITL 90,000,000 65,756 ---------------------------------------------------------------------------------------------------------------- Atlas Air, Inc., 12.25% Pass-Through Certificates, 12/1/02 250,000 273,125 --------- 338,881 - --------------------------------------------------------------------------------------------------------------------- RAILROADS - 0.2% ---------------------------------------------------------------------------------------------------------------- Transtar Holdings LP/Transtar Capital Corp., 0%/13.375% Sr. Disc. Nts., Series B, 12/15/03 (7) 200,000 138,000 - --------------------------------------------------------------------------------------------------------------------- UTILITIES - 6.8% - --------------------------------------------------------------------------------------------------------------------- ELECTRIC UTILITIES - 1.0% ---------------------------------------------------------------------------------------------------------------- Beaver Valley II Funding Corp., 9% Second Lease Obligation Bonds, 6/1/17 199,000 161,688 ---------------------------------------------------------------------------------------------------------------- El Paso Electric Co., 9.40% First Mtg. Bonds, Series E, 5/1/11 250,000 249,375 ---------------------------------------------------------------------------------------------------------------- First PV Funding Corp., 10.30% Lease Obligation Bonds, Series 1986A, 1/15/14 200,000 210,500 ---------------------------------------------------------------------------------------------------------------- New Zealand Electric Corp., 10% Debs., 10/15/01 NZD 250,000 175,739 --------- 797,302 - --------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS - 5.8% ---------------------------------------------------------------------------------------------------------------- A+ Network, Inc., 11.875% Sr. Sub. Nts., 11/1/05 200,000 208,000
65 83 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - -------------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS (CONTINUED) --------------------------------------------------------------------------------------------------------------- American Communications Services, Inc., 0%/12.75% Sr Disc. Nts., 4/1/06 (7) $ 300,000 $ 157,500 --------------------------------------------------------------------------------------------------------------- Arch Communications Group, Inc., 0%/10.875% Sr. Disc Nts., 3/15/08 (7) 200,000 104,000 --------------------------------------------------------------------------------------------------------------- Call-Net Enterprises, Inc., 0%/13.25% Sr. Disc. Nts., 12/1/04 (7) 200,000 148,500 --------------------------------------------------------------------------------------------------------------- Celcaribe SA, 0%/13.50% Sr. Sec. Nts., 3/15/04 (7) 150,000 123,375 --------------------------------------------------------------------------------------------------------------- Cellular Communications International, Inc., Zero Coupon Sr. Disc. Nts., 22.83%, 8/15/00 (5) 550,000 343,750 --------------------------------------------------------------------------------------------------------------- Cellular, Inc., 0%/11.75% Sr. Sub. Disc. Nts., 9/1/03 (7) 50,000 39,250 --------------------------------------------------------------------------------------------------------------- Comunicacion Celular SA, 0%/13.125% Sr. Deferred Coupon Bonds, 11/15/03 (7) 200,000 129,000 --------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc.: 0%/15% Sr. Sec. Disc. Nts., 7/15/05 (7) 250,000 159,375 12% Cv. Sr. Sub. Nts., 2/15/01 250,000 350,000 --------------------------------------------------------------------------------------------------------------- GST Telecommunications, Inc., 0%/13.875% Cv. Sr. Sub. Disc. Nts., 12/15/05 (2)(7) 25,000 24,781 --------------------------------------------------------------------------------------------------------------- GST USA, Inc., 0%/13.875% Bonds, 12/15/05 (7) 200,000 116,000 --------------------------------------------------------------------------------------------------------------- Horizon Cellular Telephone LP/Horizon Finance Corp., 0%/11.375% Sr. Sub. Disc. Nts., 10/1/00 (7) 250,000 235,625 --------------------------------------------------------------------------------------------------------------- Hyperion Telecommunications, Inc., Units (each unit consists of $1,000 principal amount of 0%/13% sr. disc nts., 4/15/03 and one warrant to purchase 1.8645 shares of common stock) (2)(7)(8) 300,000 169,500 --------------------------------------------------------------------------------------------------------------- In-Flight Phone Corp., 0%/14% Sr. Disc. Nts., 5/15/02 (7) 200,000 71,500 --------------------------------------------------------------------------------------------------------------- IntelCom Group (USA), Inc.: 0%/12.50% Gtd. Sr. Disc. Nts., 5/1/06 (2)(7) 370,000 202,575 0%/13.50% Sr. Disc. Nts., 9/15/05 (7) 250,000 150,625 --------------------------------------------------------------------------------------------------------------- InterCel, Inc., 0%/12% Sr. Disc. Nts., 5/1/06 (7) 300,000 165,000 --------------------------------------------------------------------------------------------------------------- MFS Communications Co., Inc.: 0%/8.875% Sr. Disc. Nts., 1/15/06 (7) 550,000 334,125 0%/9.375% Sr. Disc. Nts., 1/15/04 (7) 200,000 152,000 --------------------------------------------------------------------------------------------------------------- NEXTLINK Communications LLC/NEXTLINK Capital, Inc., 12.50% Sr. Nts., 4/15/06 (2) 200,000 200,000 --------------------------------------------------------------------------------------------------------------- Occidente y Caribe Celular SA, Units (each unit consists of $1,000 principal amount of 0%/14% sr. disc. nts., 3/15/04 and one warrant to purchase 5.709 ordinary shares) (2)(7)(8) 200,000 103,500 --------------------------------------------------------------------------------------------------------------- Petersburg Long Distance, Inc., Units (each unit consists of $1,000 principal amount of 0%/14% sr. disc. nts., 6/1/04 and one warrant to purchase 34 ordinary shares) (2)(7)(8) 300,000 237,000 --------------------------------------------------------------------------------------------------------------- PriCellular Wireless Corp., 0%/14% Sr. Sub. Disc. Nts., 11/15/01 (7) 300,000 273,000 --------------------------------------------------------------------------------------------------------------- Teleport Communications Group, Inc., 0%/11.125% Sr Disc. Nts., 7/1/07 (4)(7) 300,000 174,750 --------------------------------------------------------------------------------------------------------------- USA Mobile Communications, Inc. II, 14% Sr. Nts., 11/1/04 150,000 173,250 ----------- 4,545,981 ----------- Total Corporate Bonds and Notes (Cost $22,332,402) 22,727,634
66 84 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
MARKET VALUE SHARES SEE NOTE 1 - ----------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS - 0.8% - ----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------- Celcaribe SA (2)(10) 24,390 $ 41,463 ---------------------------------------------------------------------------------------------------------------------------- EchoStar Communications Corp., Cl. A (10) 1,750 49,438 ---------------------------------------------------------------------------------------------------------------------------- El Paso Electric Co. (10) 4,954 29,724 ---------------------------------------------------------------------------------------------------------------------------- Gillett Holdings, Inc. (6)(10) 15,000 450,000 ---------------------------------------------------------------------------------------------------------------------------- GST Telecommunications, Inc. (10) 2,800 36,750 ---------------------------------------------------------------------------------------------------------------------------- IntelCom Group, Inc. (10) 1,400 35,000 ---------------------------------------------------------------------------------------------------------------------------- United International Holdings, Inc., Cl. A (10) 1,000 13,750 ---------- Total Common Stocks (Cost $485,351) 656,125 - ----------------------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS - 2.3% - ----------------------------------------------------------------------------------------------------------------------------------- BankAmerica Corp., 8.375%, Series K 7,000 178,500 ---------------------------------------------------------------------------------------------------------------------------- Cablevision Systems Corp., 8.50% Cum. Cv., Series I 6,000 156,000 ---------------------------------------------------------------------------------------------------------------------------- California Federal Bank, 10.625% Non-Cum., Series B 2,000 219,000 ---------------------------------------------------------------------------------------------------------------------------- Earthwatch, Inc., 12% Cv. Sr. Preferred Stock, Series C (2)(11) 10,000 103,500 ---------------------------------------------------------------------------------------------------------------------------- El Paso Electric Co., 11.40% Series A Preferred Stock (10)(11) 1,000 105,000 ---------------------------------------------------------------------------------------------------------------------------- First Nationwide Bank, 11.50% Non-Cum 2,000 219,000 ---------------------------------------------------------------------------------------------------------------------------- Glendale Federal Bank, F.S.B., 8.75% Non-Cum. Cv., Series E 1,000 48,000 ---------------------------------------------------------------------------------------------------------------------------- Kelley Oil & Gas Corp., $2.625 Cv 1,000 22,250 ---------------------------------------------------------------------------------------------------------------------------- Prime Retail, Inc., $19.00 Cv., Series B 6,000 108,000 ---------------------------------------------------------------------------------------------------------------------------- SDW Holdings Corp., 15% Cum. Sr. Exchangeable Preferred Stock (2)(10) 3,750 118,125 ---------------------------------------------------------------------------------------------------------------------------- Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred Stock (2)(11) 250 245,000 ---------------------------------------------------------------------------------------------------------------------------- Walden Residential Properties, Inc., 9.16% Cv., Series A 10,000 247,500 ---------- Total Preferred Stocks (Cost $1,737,693) 1,769,875 UNITS RIGHTS, WARRANTS AND CERTIFICATES - 0.1% - ----------------------------------------------------------------------------------------------------------------------------------- American Telecasting, Inc. Wts., Exp. 6/99 1,500 9,000 ----------------------------------------------------------------------------------------------------------------------------- Cellular Communications International, Inc. Wts., Exp. 8/03 300 4,500 ----------------------------------------------------------------------------------------------------------------------------- Communication Cellular SA Wts., Exp. 11/03 (2) 200 1,000 ----------------------------------------------------------------------------------------------------------------------------- Eye Care Centers of America, Inc. Wts., Exp. 10/03 (2) 70 350 ----------------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc. Wts., Exp. 7/05 (2) 7,500 52,500 ----------------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc. Wts., Exp. 11/99 (2) 200 5,000 ----------------------------------------------------------------------------------------------------------------------------- In-Flight Phone Corp. Wts., Exp. 8/02 (2) 200 -- ----------------------------------------------------------------------------------------------------------------------------- IntelCom Group, Inc. Wts., Exp. 9/05 (2) 825 15,881 ----------------------------------------------------------------------------------------------------------------------------- SDW Holdings Corp., Cl. B Wts., Exp. 12/06 (2) 375 4,875 ----------------------------------------------------------------------------------------------------------------------------- Terex Corp. Rts., Exp. 7/96 (2) 36 2 ----------------------------------------------------------------------------------------------------------------------------- United International Securities Ltd. Wts., Exp. 11/99 200 5,800 ---------- Total Rights, Warrants and Certificates (Cost $11,014) 98,908
67 85 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued)
PRINCIPAL MARKET VALUE AMOUNT(1) SEE NOTE 1 - ------------------------------------------------------------------------------------------------------------------------------------ STRUCTURED INSTRUMENTS - 2.1% - ------------------------------------------------------------------------------------------------------------------------------------ Bayerische Landesbank Girozentrale, New York Branch, 14% CD Linked Nts., 12/17/96 (indexed to the cross $ 650,000 $ 651,040 currency rates of Greek Drachma and European Currency Unit) ----------------------------------------------------------------------------------------------------------------------------- Bayerische Landesbank Girozentrale, New York Branch, 5.60% CD Linked Nts., 1/30/97 (indexed to the closing NZD 60,340 44,788 Nikkei 225 Index on 1/23/97, 10 yr. Japanese Yen swap rate & New Zealand Dollar on 1/28/97) ----------------------------------------------------------------------------------------------------------------------------- Canadian Imperial Bank of Commerce, New York Branch, 14% CD Linked Nts., 11/25/96 (indexed to the cross 150,000 147,195 currency rates of Greek Drachma and European Currency Unit) ----------------------------------------------------------------------------------------------------------------------------- Goldman, Sachs & Co., Argentina Local Market Securities Trust, 11.30%, 4/1/00 (representing debt of Argentina (6) 208,695 193,565 (Republic of) Bonos del Tesoro Bonds, Series 10, 5.469%, 4/1/00 and an interest rate swap between Goldman Sachs and the Trust) ----------------------------------------------------------------------------------------------------------------------------- Swiss Bank Corp., New York Branch, 6.60% CD Linked Nts., 1/30/97 (indexed to the closing Nikkei 225 Index on NZD 362,428 273,240 1/23/97) ----------------------------------------------------------------------------------------------------------------------------- United Mexican States Linked Nts. (indexed to the greater of Cetes Option Amount or USD LIBOR Option Amount, (2) 300,000 348,000 11/27/96) ----------- Total Structured Instruments (Cost $1,588,826) 1,657,828 - ------------------------------------------------------------------------------------------------------------------------------------ REPURCHASE AGREEMENT - 5.7% - ------------------------------------------------------------------------------------------------------------------------------------ Repurchase agreement with First Chicago Capital Markets, 5.45%, dated 6/28/96, to be repurchased at $4,502,044 on 7/1/96, collateralized by U.S. Treasury Bonds, 6.25%-11.25%, 2/15/07-8/15/23, with a value of $3,016,773, and U.S. Treasury Nts., 4.75%-7.875%, 9/30/97-2/15/05, with a value of $1,574,324 (Cost $4,500,000) 4,500,000 4,500,000 ----------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $77,701,887) 100.0% 78,632,872 ----------------------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (0.0) (6,707) --------- ----------- NET ASSETS 100.0% $78,626,165 ========= ===========
1. Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: AUD - Australian Dollar IDR - Indonesian Rupiah CAD - Canadian Dollar ITL - Italian Lira CZK - Czech Koruna JPY - Japanese Yen DEM - German Deutsche Mark MXP - Mexican Peso ESP - Spanish Peseta NZD - New Zealand Dollar FIM - Finnish Markka PLZ - Polish Zloty GBP - British Pound Sterling SEK - Swedish Krona 68 86 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Statement of Investments (Continued) 2. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $5,185,437 or 6.60% of the Fund's net assets, at June 30, 1996. 3. Represents the current interest rate for a variable rate security. 4. When-issued security to be delivered and settled after June 30, 1996. 5. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 6. Identifies issues considered to be illiquid - See applicable note of Notes to Financial Statements. 7. Denotes a step bond: a zero coupon bond that converts to a fixed rate of interest at a designated future date. 8. 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. 9. Represents the current interest rate for an increasing rate security. 10. Non-income producing security. 11. Interest or dividend is paid in kind. 12. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows:
CONTRACTS/ PRINCIPAL SUBJECT EXPIRATION EXERCISE PREMIUM MARKET VALUE TO CALL DATE PRICE RECEIVED (NOTE 1) - -------------------------------------------------------------------------------------------------------------------------- Call option on Czech Koruna 1,200,000 9/6/96 28.357(CZK) $ 16,080 $ 29,556 Call option on Mexican Peso 630,000 8/5/96 8.03(MXP) 16,947 22,425 Call option on Morocco (Kingdom of) Loan Participation Agreement, Tranche A, 6.437%, 1/1/09 150,000 7/12/96 $ 71.25 1,425 1,845 -------- -------- $ 34,452 $ 53,826 ======== ========
13. Securities with an aggregate market value of $182,866 are held in collateralized accounts to cover initial margin requirements on open futures sales contracts. See applicable note of Notes to Financial Statements. See accompanying Notes to Financial Statements. 69 87 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments JUNE 30, 1996 (Unaudited)
PRINCIPAL MARKET VALUE AMOUNT (NOTE 1) - ---------------------------------------------------------------------------------------------------------------- NON-CONVERTIBLE CORPORATE BONDS AND NOTES - 0.7% - ---------------------------------------------------------------------------------------------------------------- Penn Traffic Co., 11.50% Sr. Nts., 4/15/06 (Cost $154,500) $150,000 $ 139,875 - ---------------------------------------------------------------------------------------------------------------- CONVERTIBLE CORPORATE BONDS AND NOTES - 9.0% - ---------------------------------------------------------------------------------------------------------------- ALZA Corp., 5% Cv. Sub. Debs., 5/1/06 200,000 194,500 ---------------------------------------------------------------------------------------------------- Apple Computer, Inc., 6% Cv. Sub. Nts., 6/1/01 (1) 200,000 196,750 ---------------------------------------------------------------------------------------------------- Continental Airlines, Inc., 6.75% Cv. Sub. Nts., 4/15/06 (1) 150,000 180,000 ---------------------------------------------------------------------------------------------------- Corporate Express, Inc., 4.50% Cv. Nts., 7/1/00 (1) 200,000 199,000 ---------------------------------------------------------------------------------------------------- Jacor Communications, Inc., Zero Coupon Cv. Sr. Nts., 5.50%, 6/12/11 (2) 250,000 116,562 ---------------------------------------------------------------------------------------------------- Nabors Industries, Inc., 5% Cv. Sub. Nts., 5/15/06 200,000 224,000 ---------------------------------------------------------------------------------------------------- Softkey International, Inc., 5.50% Cv. Sr. Nts., 11/1/00 150,000 120,750 ---------------------------------------------------------------------------------------------------- Time Warner, Inc., Zero Coupon Cv. Sr. Sub. Nts., 5.124%, 6/22/13 (2) 500,000 205,625 ---------------------------------------------------------------------------------------------------- U.S. Office Products Co., 5.50% Cv. Sub. Nts., 5/15/03 (1) 250,000 253,125 ---------------------------------------------------------------------------------------------------- Williams-Sonoma, Inc., 5.25% Cv. Sub. Nts., 4/15/03 (1) 225,000 240,188 ------------- Total Convertible Corporate Bonds and Notes (Cost $1,875,865) 1,930,500 SHARES - ---------------------------------------------------------------------------------------------------------------- COMMON STOCKS - 65.7% - ---------------------------------------------------------------------------------------------------------------- BASIC MATERIALS - 4.0% - ---------------------------------------------------------------------------------------------------------------- CHEMICALS - 3.1% ---------------------------------------------------------------------------------------------------- IMC Global, Inc. 6,000 225,750 ---------------------------------------------------------------------------------------------------- Monsanto Co. 2,500 81,250 ---------------------------------------------------------------------------------------------------- Potash Corp. of Saskatchewan, Inc. 2,000 132,500 ---------------------------------------------------------------------------------------------------- W.R. Grace & Co. 3,000 212,625 ------------- 652,125 - ---------------------------------------------------------------------------------------------------------------- METALS - 0.9% ---------------------------------------------------------------------------------------------------- Allegheny Ludlum Corp. 2,000 37,750 ---------------------------------------------------------------------------------------------------- Century Aluminum Co. (3) 10,000 157,500 ------------- 195,250 - ---------------------------------------------------------------------------------------------------------------- CONSUMER CYCLICALS - 12.3% - ---------------------------------------------------------------------------------------------------------------- AUTOS & HOUSING - 0.8% ---------------------------------------------------------------------------------------------------- Ford Motor Co. 1,500 48,562 ---------------------------------------------------------------------------------------------------- ITI Technologies, Inc. (3) 4,000 132,000 ------------- 180,562 - ---------------------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT - 5.5% ---------------------------------------------------------------------------------------------------- Delta Air Lines, Inc. 3,500 290,500 ---------------------------------------------------------------------------------------------------- Disney (Walt) Co. 1,250 78,594 ---------------------------------------------------------------------------------------------------- Eastman Kodak Co. 1,500 116,625 ---------------------------------------------------------------------------------------------------- Gaylord Entertainment Co., Cl. A 2,100 59,325 ---------------------------------------------------------------------------------------------------- Grand Casinos, Inc. (3) 2,000 51,500 ---------------------------------------------------------------------------------------------------- ITT Corp. (New) (3) 2,500 165,625 ---------------------------------------------------------------------------------------------------- Suburban Lodges of America, Inc. (3) 2,000 46,250 ---------------------------------------------------------------------------------------------------- U S West Media Group (3) 8,000 146,000 ---------------------------------------------------------------------------------------------------- Wendy's International, Inc. 5,000 93,125
70 88 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ---------------------------------------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT (CONTINUED) ---------------------------------------------------------------------------------------------------- Western Pacific Airlines, Inc. (3) 8,250 $ 117,562 ------------ 1,165,106 - ---------------------------------------------------------------------------------------------------------------- MEDIA - 3.6% ---------------------------------------------------------------------------------------------------- Comcast Corp., Cl. A Special 8,000 148,000 ---------------------------------------------------------------------------------------------------- Infinity Broadcasting Corp., Cl. A (3) 3,500 105,000 ---------------------------------------------------------------------------------------------------- Viacom, Inc., Cl. B (3) 8,250 320,719 ---------------------------------------------------------------------------------------------------- World Color Press, Inc. (3) 7,500 190,312 ------------ 764,031 - ---------------------------------------------------------------------------------------------------------------- RETAIL: GENERAL - 1.0% ---------------------------------------------------------------------------------------------------- Dillard Department Stores, Inc., Cl. A 1,500 54,750 ---------------------------------------------------------------------------------------------------- Donna Karan International, Inc. 3,600 100,800 ---------------------------------------------------------------------------------------------------- Warnaco Group, Inc. (The), Cl. A 2,000 51,500 ------------ 207,050 - ---------------------------------------------------------------------------------------------------------------- RETAIL: SPECIALTY - 1.4% ---------------------------------------------------------------------------------------------------- Circuit City Stores, Inc. 1,500 54,187 ---------------------------------------------------------------------------------------------------- MicroAge, Inc. (3) 8,500 115,812 ---------------------------------------------------------------------------------------------------- Neostar Retail Group, Inc. (3) 10,000 51,250 ---------------------------------------------------------------------------------------------------- The Limited, Inc. 3,500 75,250 ------------ 296,499 - ---------------------------------------------------------------------------------------------------------------- CONSUMER NON-CYCLICALS - 11.4% - ---------------------------------------------------------------------------------------------------------------- BEVERAGES - 0.4% ---------------------------------------------------------------------------------------------------- Cott Corp. 10,000 93,750 - ---------------------------------------------------------------------------------------------------------------- HEALTHCARE/DRUGS - 1.2% ---------------------------------------------------------------------------------------------------- Astra AB Free, Series A 1,500 66,235 ---------------------------------------------------------------------------------------------------- Schering-Plough Corp. 3,000 188,250 ------------ 254,485 - ---------------------------------------------------------------------------------------------------------------- HEALTHCARE/SUPPLIES & SERVICES - 6.2% ---------------------------------------------------------------------------------------------------- American Medical Response, Inc. 2,750 96,937 ---------------------------------------------------------------------------------------------------- Arterial Vascular Engineering, Inc. (3) 2,000 72,500 ---------------------------------------------------------------------------------------------------- Baxter International, Inc. 3,000 141,750 ---------------------------------------------------------------------------------------------------- Boston Scientific Corp. (3) 4,500 202,500 ---------------------------------------------------------------------------------------------------- Columbia/HCA Healthcare Corp. 3,500 186,812 ---------------------------------------------------------------------------------------------------- Mid Atlantic Medical Services (3) 2,500 35,625 ---------------------------------------------------------------------------------------------------- St. Jude Medical, Inc. (3) 4,000 134,000 ---------------------------------------------------------------------------------------------------- Tenet Healthcare Corp. (3) 10,500 224,437 ---------------------------------------------------------------------------------------------------- United Healthcare Corp. 4,500 227,250 ------------ 1,321,811 - ---------------------------------------------------------------------------------------------------------------- HOUSEHOLD GOODS - 1.5% ---------------------------------------------------------------------------------------------------- Kimberly-Clark Corp. 3,500 270,375 ---------------------------------------------------------------------------------------------------- Premark International, Inc. 1,000 18,500 ---------------------------------------------------------------------------------------------------- Tupperware Corp. (3) 1,000 42,250 ------------ 331,125 - ---------------------------------------------------------------------------------------------------------------- TOBACCO - 2.1% ---------------------------------------------------------------------------------------------------- Philip Morris Cos., Inc. 4,250 442,000 - ---------------------------------------------------------------------------------------------------------------- ENERGY - 1.7% - ---------------------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS - 1.1% ---------------------------------------------------------------------------------------------------- Apache Corp. 4,000 131,500
71 89 Apache Training OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ---------------------------------------------------------------------------------------------------------------- ENERGY SERVICES & PRODUCERS (CONTINU ---------------------------------------------------------------------------------------------------- GeoScience Corp. (3) 7,500 $ 105,000 236,500 - ---------------------------------------------------------------------------------------------------------------- OIL-INTEGRATED - 0.6% ---------------------------------------------------------------------------------------------------- Chevron Corp. 1,000 59,000 ---------------------------------------------------------------------------------------------------- USX-Marathon Group 4,000 80,500 ----------- 139,500 - ---------------------------------------------------------------------------------------------------------------- FINANCIAL - 13.0% - ---------------------------------------------------------------------------------------------------------------- BANKS - 5.6% ---------------------------------------------------------------------------------------------------- Chase Manhattan Corp. (New) 4,000 282,500 ---------------------------------------------------------------------------------------------------- Citicorp 2,500 206,562 ---------------------------------------------------------------------------------------------------- Coast Savings Financial, Inc. (3) 5,000 163,750 ---------------------------------------------------------------------------------------------------- Commercial Federal Corp. 1,250 47,812 ---------------------------------------------------------------------------------------------------- CoreStates Financial Corp. 2,500 96,250 ---------------------------------------------------------------------------------------------------- First Chicago NBD Corp. 1,250 48,906 ---------------------------------------------------------------------------------------------------- Fleet Financial Group, Inc. 5,750 250,125 ---------------------------------------------------------------------------------------------------- Great Western Financial Corp. 4,000 95,500 ------------ 1,191,405 - ---------------------------------------------------------------------------------------------------------------- DIVERSIFIED FINANCIAL - 3.4% ---------------------------------------------------------------------------------------------------- American Express Co. 5,000 223,125 ---------------------------------------------------------------------------------------------------- Associates First Capital Corp., Cl. A (3) 500 18,812 ---------------------------------------------------------------------------------------------------- Countrywide Credit Industries, Inc. 2,500 61,875 ---------------------------------------------------------------------------------------------------- Dean Witter, Discover & Co. 1,250 71,563 ---------------------------------------------------------------------------------------------------- Federal National Mortgage Assn. 1,500 50,250 ---------------------------------------------------------------------------------------------------- PMI Group, Inc. (The) 3,000 127,500 ---------------------------------------------------------------------------------------------------- Travelers Group, Inc. 3,750 171,094 ----------- 724,219 - ---------------------------------------------------------------------------------------------------------------- INSURANCE - 4.0% ---------------------------------------------------------------------------------------------------- Allstate Corp. 8,000 365,000 ---------------------------------------------------------------------------------------------------- Equitable of Iowa Cos., Inc. 750 26,625 ---------------------------------------------------------------------------------------------------- Everest Reinsurance Holdings, Inc. 10,000 258,750 ---------------------------------------------------------------------------------------------------- IPC Holdings Ltd. 10,000 201,250 ----------- 851,625 - ---------------------------------------------------------------------------------------------------------------- INDUSTRIAL - 4.1% - ---------------------------------------------------------------------------------------------------------------- ELECTRICAL EQUIPMENT - 0.4% ---------------------------------------------------------------------------------------------------- Honeywell, Inc. 1,750 95,375 - ---------------------------------------------------------------------------------------------------------------- INDUSTRIAL MATERIALS - 1.0% ---------------------------------------------------------------------------------------------------- BMC West Corp. (3) 12,000 205,500 - ---------------------------------------------------------------------------------------------------------------- INDUSTRIAL SERVICES - 0.5% ---------------------------------------------------------------------------------------------------- DecisionOne Holdings Corp. (3) 5,000 118,750 - ---------------------------------------------------------------------------------------------------------------- MANUFACTURING - 1.7% ---------------------------------------------------------------------------------------------------- American Standard Cos., Inc. (3) 11,000 363,000 - ---------------------------------------------------------------------------------------------------------------- TRANSPORTATION - 0.5% ---------------------------------------------------------------------------------------------------- Tranz Rail Holdings Ltd., Sponsored ADR (3) 7,500 104,063 - ---------------------------------------------------------------------------------------------------------------- TECHNOLOGY - 18.2% - ---------------------------------------------------------------------------------------------------------------- AEROSPACE/DEFENSE - 2.9% ---------------------------------------------------------------------------------------------------- Boeing Co. 1,600 139,400 ---------------------------------------------------------------------------------------------------- Northrop Grumman Corp. 1,700 115,813 ---------------------------------------------------------------------------------------------------- Rockwell International Corp. 3,000 171,750
72 90 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ---------------------------------------------------------------------------------------------------------------- AEROSPACE/DEFENSE (CONTINUED) ---------------------------------------------------------------------------------------------------- TRW, Inc. 2,100 $ 188,738 ----------- 615,701 - ---------------------------------------------------------------------------------------------------------------- COMPUTER HARDWARE - 7.4% ---------------------------------------------------------------------------------------------------- Cabletron Systems, Inc. (3) 2,500 171,563 ---------------------------------------------------------------------------------------------------- Compaq Computer Corp. (3) 1,250 61,563 ---------------------------------------------------------------------------------------------------- Digital Equipment Corp. (3) 6,750 303,750 ---------------------------------------------------------------------------------------------------- International Business Machines Corp. 5,000 495,000 ---------------------------------------------------------------------------------------------------- Lexmark International Group, Inc., Cl. A (3) 5,000 100,625 ---------------------------------------------------------------------------------------------------- Seagate Technology, Inc. (3) 6,500 292,500 ---------------------------------------------------------------------------------------------------- Sun Microsystems, Inc. (3) 2,500 147,188 ----------- 1,572,189 - ---------------------------------------------------------------------------------------------------------------- COMPUTER SOFTWARE - 3.4% ---------------------------------------------------------------------------------------------------- Nintendo Co. Ltd. 2,900 215,752 ---------------------------------------------------------------------------------------------------- PLATINUM Technology, Inc. (3) 8,000 121,000 ---------------------------------------------------------------------------------------------------- Structural Dynamics Research Corp. (3) 11,000 242,000 ---------------------------------------------------------------------------------------------------- Sybase, Inc. (3) 1,500 35,438 ---------------------------------------------------------------------------------------------------- Worldtalk Corp. (3) 10,000 122,500 ----------- 736,690 - ---------------------------------------------------------------------------------------------------------------- ELECTRONICS - 3.6% ---------------------------------------------------------------------------------------------------- DuPont Photomasks, Inc. (3) 5,800 118,900 ---------------------------------------------------------------------------------------------------- Hewlett-Packard Co. 1,000 99,625 ---------------------------------------------------------------------------------------------------- Intel Corp. 1,500 110,156 ---------------------------------------------------------------------------------------------------- LSI Logic Corp. (3) 4,000 104,000 ---------------------------------------------------------------------------------------------------- Nokia Corp., Preference 2,500 92,500 ---------------------------------------------------------------------------------------------------- Teradyne, Inc. (3) 2,750 47,438 ---------------------------------------------------------------------------------------------------- Texas Instruments, Inc. (4) 750 37,406 ---------------------------------------------------------------------------------------------------- Waters Corp. (3) 5,000 165,000 ----------- 775,025 - ---------------------------------------------------------------------------------------------------------------- TELECOMMUNICATIONS-TECHNOLOGY - 0.9% ---------------------------------------------------------------------------------------------------- Bay Networks, Inc. (3) 1,000 25,750 ---------------------------------------------------------------------------------------------------- Cisco Systems, Inc. (3) 2,000 113,250 ---------------------------------------------------------------------------------------------------- Mobile Telecommunication Technologies Corp. (3) 3,000 43,875 ----------- 182,875 - ---------------------------------------------------------------------------------------------------------------- UTILITIES - 1.0% - ---------------------------------------------------------------------------------------------------------------- TELEPHONE UTILITIES - 1.0% ---------------------------------------------------------------------------------------------------- Teleport Communications Group, Inc., Cl. A 7,100 135,788 ---------------------------------------------------------------------------------------------------- Western Wireless Corp. (3) 3,500 74,813 ----------- 210,601 ----------- Total Common Stocks (Cost $13,523,070) 14,026,812 - ---------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS - 6.2% - ---------------------------------------------------------------------------------------------------------------- Cablevision Systems Corp., 8.50% Cum. Cv., Series I 4,000 104,000 ---------------------------------------------------------------------------------------------------- K-Mart Financing I, 7.75% Cv. Preferred Stock (3) 5,000 271,250 ---------------------------------------------------------------------------------------------------- Noram Financing I, 6.25% Cv. Preferred Stock 5,000 271,250 ---------------------------------------------------------------------------------------------------- SFX Broadcasting, Inc., 6.50% Cv. Preferred (1)(3) 5,000 261,250
73 91 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments (Continued)
MARKET VALUE SHARES (NOTE 1) - ---------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS (CONTINUED) ---------------------------------------------------------------------------------------------------- Trans World Airlines, Inc., 8% Cum. Cv. Exchangeable Preferred Stock (1) 8,500 $ 415,437 ------------ Total Preferred Stocks (Cost $1,285,064) 1,323,187 - ---------------------------------------------------------------------------------------------------------------- OTHER SECURITIES - 6.0% - ---------------------------------------------------------------------------------------------------------------- Alco Standard Corp., $5.04 Depositary Shares each representing 1/100 of a share of Conversion Preferred Stock, Series BB, Automatically Convertible Equity Securities 1,250 103,750 ---------------------------------------------------------------------------------------------------- AnnTaylor Finance Trust, 8.50% Cv. Trust Originated Preferred Securities (1)(3) 5,000 298,125 ---------------------------------------------------------------------------------------------------- Elsag Bailey Financing Trust, 5.50% Cv. Trust Originated Preferred Securities (1) 2,000 99,000 ---------------------------------------------------------------------------------------------------- James River Corp. of Virginia, Depositary Shares each representing a one-hundredth interest in a share of Series P, 9% Cum. Cv. Preferred Stock, Dividend Enhanced Convertible Stock 3,000 75,750 ---------------------------------------------------------------------------------------------------- Merrill Lynch & Co., 7.25% Structured Yield Product Exchangeable for Stock (3) 4,000 226,500 ---------------------------------------------------------------------------------------------------- Merrill Lynch & Co., Inc., 6% Cv. Preferred, Structured Yield Product Exchangeable for Cox Communications, Inc., Common Stock (3) 5,000 110,625 ---------------------------------------------------------------------------------------------------- Salomon, Inc., 7.625% Cv. Preferred, Debt Exchangeable for Common Stock 6,800 187,000 ---------------------------------------------------------------------------------------------------- Westinghouse Electric Corp., Participating Equity Preferred Shares, $1.30 Cv., Series C (1) 10,000 176,250 ------------ Total Other Securities (Cost $1,220,258) 1,277,000 PRINCIPAL AMOUNT - ---------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENTS - 15.5% - ---------------------------------------------------------------------------------------------------------------- Repurchase agreement with First Chicago Capital Markets, 5.45%, dated 6/28/96, to be repurchased at $3,301,499 on 7/1/96, collateralized by U.S. Treasury Bonds, 6.25%-11.25%, 2/15/07-8/15/23, with a value of $2,212,300 and U.S. Treasury Nts., 4.75%-7.875%, 9/30/97-2/15/05, with a value of $1,154,505 (Cost $3,300,000) $3,300,000 3,300,000 ---------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $21,358,757) 103.1% 21,997,374 ---------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (3.1) (664,683) ---------- ------------ NET ASSETS 100.0% $21,332,691 ========== ============
1. Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $2,319,125 or 10.87% of the Fund's net assets, at June 30, 1996. 74 92 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Statement of Investments (Continued) ------------------------------------------------------------------- 2. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 3. Non-income producing security. 4. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows:
SHARES SUBJECT EXPIRATION EXERCISE PREMIUM MARKET VALUE TO CALL DATE PRICE RECEIVED (NOTE 1) -------------------------------------------------------------------------------------------------------------- Texas Instruments, Inc., Call Opt. 700 7/96 $50 $4,537 $ 1,138
See accompanying Notes to Financial Statements. 75 93 Oppenheimer Variable Account Funds Statements of Assets and Liabilities June 30, 1996 (Unaudited)
Oppenheimer Oppenheimer Oppenheimer Oppenheimer Capital Oppenheimer Money High Income Bond Appreciation Growth Fund Fund Fund Fund Fund ---------------------------------------------------------------------------- ASSETS: Investments, at value (cost * ) (including repurchase agreements **) - see accompanying statements $115,072,969 $156,651,526 $311,908,746 $496,438,966 $144,789,612 Unrealized appreciation on forward foreign currency exchange contracts - See applicable note -- 86,396 44,513 -- -- Cash 19,755 239,189 33,484 1,171,411 231,093 Receivables: Closed forward foreign currency exchange contracts -- 28,112 4,502 -- -- Dividends and interest 174,385 2,102,997 5,038,216 89,350 92,377 Shares of beneficial interest sold 36,125 327,796 173,827 1,379,023 188,713 Investments sold -- 611,959 1,426,309 3,904,622 1,096,302 Other 2,633 3,814 4,736 6,546 3,708 ---------------------------------------------------------------------------- Total assets 115,305,867 160,051,789 318,634,333 502,989,918 146,401,805 ---------------------------------------------------------------------------- LIABILITIES: Options written, at value (premiums received ***) - see accompanying statements and notes -- 22,241 45,966 -- -- Unrealized depreciation on forward foreign currency exchange contracts - See applicable note -- 8,511 15,592 -- -- Payables and other liabilities: Closed forward foreign currency exchange contracts -- 11,240 18,999 -- -- Daily variation on futures contracts - See notes -- -- -- -- -- Dividends 158,183 -- -- -- -- Investments purchased (including those purchased on a when-issued basis ****) - Note 1 -- 4,275,977 759,038 16,011,339 1,655,939 Shares of beneficial interest redeemed 544,471 -- 142,079 52,678 644 Custodian fees 3,308 9,098 14,005 9,821 3,287 Other 13,647 17,572 21,754 43,898 19,727 ---------------------------------------------------------------------------- Total liabilities 719,609 4,344,639 1,017,433 16,117,736 1,679,597 ---------------------------------------------------------------------------- NET ASSETS $114,586,258 $155,707,150 $317,616,900 $486,872,182 $144,722,208 ============================================================================ COMPOSITION OF NET ASSETS: Paid-in capital $114,602,218 $150,590,951 $315,750,262 $357,898,519 $107,561,054 Undistributed net investment income -- 624,260 901,640 98,398 684,501 Accumulated net realized gain (loss) from investments and foreign currency transactions (15,960) (2,275,267) (92,383) 23,861,818 5,825,003 Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies -- 6,767,206 1,057,381 105,013,447 30,651,650 ---------------------------------------------------------------------------- NET ASSETS $114,586,258 $155,707,150 $317,616,900 $486,872,182 $144,722,208 ============================================================================ SHARES OF BENEFICIAL INTEREST OUTSTANDING 114,602,218 14,510,103 27,823,143 12,713,932 5,972,737 NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $1.00 $10.73 $11.42 $38.29 $24.23 *Cost $115,072,969 $149,958,141 $310,870,304 $391,425,519 $114,137,962 **Repurchase agreements -- $15,800,000 $18,900,000 $87,800,000 $17,400,000 ***Premiums received -- $17,175 $30,995 -- -- ****When-issued basis -- $3,235,962 -- -- --
See accompanying Notes to Financial Statements. 76 94 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Assets and Liabilities (Continued) JUNE 30, 1996 (Unaudited)
OPPENHEIMER OPPENHEIMER OPPENHEIMER OPPENHEIMER MULTIPLE GLOBAL STRATEGIC GROWTH & STRATEGIES SECURITIES BOND INCOME FUND FUND FUND FUND ---------------------------------------------------------------------- ASSETS: Investments, at value (cost * ) (including repurchase agreements **) - see accompanying statements $ 421,715,693 $ 481,017,994 $ 78,632,872 $ 21,997,374 Unrealized appreciation on forward foreign currency exchange contracts - See applicable note -- 2,092,219 34,104 -- Cash 190,678 1,178,720 134,233 99,773 Receivables: Closed forward foreign currency exchange contracts -- -- 18,995 -- Dividends and interest 3,113,392 1,159,071 1,144,202 31,638 Shares of beneficial interest sold 239,641 1,154,637 130,475 160,670 Investments sold 471,269 3,499,164 635,623 393,763 Other 7,460 6,374 2,460 1,295 ---------------------------------------------------------------------- Total assets 425,738,133 490,108,179 80,732,964 22,684,513 ---------------------------------------------------------------------- LIABILITIES: Options written, at value (premiums received ***) - see accompanying statements and notes 879,731 -- 53,826 1,138 Unrealized depreciation on forward foreign currency exchange contracts - See applicable note -- 21,657 36,086 -- Payables and other liabilities: Closed forward foreign currency exchange contracts -- -- -- -- Daily variation on futures contracts - See notes -- -- 3,094 -- Dividends -- -- -- -- Investments purchased (including those purchased on a when-issued basis ****) - Note 1 2,873,028 8,584,203 1,999,087 1,332,856 Shares of beneficial interest redeemed 13,965 1,038 1,616 -- Custodian fees 27,847 108,084 2,328 5,406 Other 17,248 50,021 10,762 12,422 ---------------------------------------------------------------------- Total liabilities 3,811,819 8,765,003 2,106,799 1,351,822 ---------------------------------------------------------------------- NET ASSETS $ 421,926,314 $ 481,343,176 $ 78,626,165 $ 21,332,691 ====================================================================== COMPOSITION OF NET ASSETS: Paid-in capital $ 366,114,884 $ 450,940,815 $ 77,920,709 $ 19,093,273 Undistributed net investment income 853,394 3,185,134 652,100 1,351 Accumulated net realized gain (loss) from investments and foreign currency transactions 6,442,997 (25,451,676) (851,495) 1,596,051 Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies 48,515,039 52,668,903 904,851 642,016 ---------------------------------------------------------------------- NET ASSETS $ 421,926,314 $ 481,343,176 $ 78,626,165 $ 21,332,691 ====================================================================== SHARES OF BENEFICIAL INTEREST OUTSTANDING 28,714,076 29,630,799 15,990,133 1,444,474 NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $ 14.69 $ 16.24 $ 4.92 $ 14.77 *Cost $ 373,134,359 $ 430,416,694 $ 77,701,887 $ 21,358,757 **Repurchase agreements $ 71,300,000 $ 17,900,000 $ 4,500,000 $ 3,300,000 ***Premiums received $ 809,437 -- $ 34,452 $ 4,537 ****When-issued basis -- -- $ 1,244,208 --
See accompanying Notes to Financial Statements. 77 95 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Operations FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited)
OPPENHEIMER OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL OPPENHEIMER MONEY HIGH INCOME BOND APPRECIATION GROWTH FUND FUND FUND FUND FUND ------------------------------------------------------------------------------ INVESTMENT INCOME: Interest (net of withholding taxes of *) $ 2,079,835 $ 6,828,844 $ 8,882,639 $ 1,540,454 $ 619,167 Dividends (net of withholding taxes of **) -- 275,031 47,527 106,666 593,891 ------------------------------------------------------------------------------ Total income 2,079,835 7,103,875 8,930,166 1,647,120 1,213,058 ------------------------------------------------------------------------------ EXPENSES: Management fees - See applicable note 169,884 535,556 874,928 1,464,761 488,805 Custodian fees and expenses 2,230 34,329 18,960 24,420 5,212 Legal and auditing fees 6,597 8,332 6,595 6,494 5,513 Insurance expenses 1,769 2,443 2,887 2,099 2,251 Trustees' fees and expenses 1,177 1,746 1,790 2,433 1,103 Registration and filing fees -- 8,598 14,607 30,591 5,888 Other 1,713 919 590 899 229 ------------------------------------------------------------------------------ Total expenses 183,370 591,923 920,357 1,531,697 509,001 ------------------------------------------------------------------------------ NET INVESTMENT INCOME 1,896,465 6,511,952 8,009,809 115,423 704,057 ------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS): Net realized gain (loss) from: Investments: Unaffiliated companies 2,387 1,161,443 104,747 24,183,340 5,982,807 Affiliated companies -- -- -- -- -- Closing of futures contracts -- -- (67,865) -- -- Closing and expiration of options written -- 33,013 83,599 -- -- Foreign currency transactions -- (62,140) (85,215) -- -- Net change in unrealized appreciation or depreciation on: Investments -- 1,128,846 (7,873,177) 42,038,100 7,033,727 Translation of assets and liabilities denominated in foreign currencies -- (86,883) 104,084 -- -- ------------------------------------------------------------------------------ Net realized and unrealized gain (loss) 2,387 2,174,279 (7,733,827) 66,221,440 13,016,534 ------------------------------------------------------------------------------ NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 1,898,852 $ 8,686,231 $ 275,982 $66,336,863 $13,720,591 ============================================================================== *Interest -- 13,605 $ 36,464 -- -- **Dividends -- -- -- -- --
See accompanying Notes to Financial Statements. 78 96 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Operations (Continued) FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited)
OPPENHEIMER OPPENHEIMER OPPENHEIMER OPPENHEIMER MULTIPLE GLOBAL STRATEGIC GROWTH & STRATEGIES SECURITIES BOND INCOME FUND FUND FUND FUND ---------------------------------------------------------------------------- INVESTMENT INCOME: Interest (net of withholding taxes of *) $ 9,684,176 $ 1,229,932 $ 3,178,234 $ 60,155 Dividends (net of withholding taxes of **) 2,439,305 3,698,778 36,922 66,087 ---------------------------------------------------------------------------- Total income 12,123,481 4,928,710 3,215,156 126,242 ---------------------------------------------------------------------------- EXPENSES: Management fees - See applicable note 1,477,367 1,541,026 251,463 39,407 Custodian fees and expenses 40,788 152,700 21,499 14,821 Legal and auditing fees 11,188 11,848 6,299 6,550 Insurance expenses 4,756 3,529 -- 886 Trustees' fees and expenses 5,005 2,328 458 1,287 Registration and filing fees 14,779 29,472 6,516 5,218 Other 1,846 1,605 431 1,603 ---------------------------------------------------------------------------- Total expenses 1,555,729 1,742,508 286,666 69,772 ---------------------------------------------------------------------------- NET INVESTMENT INCOME 10,567,752 3,186,202 2,928,490 56,470 ---------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS): Net realized gain (loss) from: Investments: Unaffiliated companies 6,574,588 3,725,263 688,881 1,598,305 Affiliated companies -- 20,580 -- -- Closing of futures contracts -- -- 18,778 -- Closing and expiration of options written 765,694 -- (24,449) 1,764 Foreign currency transactions (22,836) (3,023,567) 113,470 -- Net change in unrealized appreciation or depreciation on: Investments 7,003,866 31,486,881 (903,801) 144,321 Translation of assets and liabilities denominated in foreign currencies (648,298) (2,628,229) (32,399) (7,480) ---------------------------------------------------------------------------- Net realized and unrealized gain (loss) 13,673,014 29,580,928 (139,520) 1,736,910 ---------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 24,240,766 $ 32,767,130 $ 2,788,970 $ 1,793,380 ============================================================================ *Interest $ 9,155 -- $ 21,403 -- **Dividends $ 65,226 $ 228,319 -- $ 561
See accompanying Notes to Financial Statements. 79 97 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Changes in Net Assets FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited) AND THE YEAR ENDED DECEMBER 31, 1995
OPPENHEIMER OPPENHEIMER MONEY HIGH INCOME FUND FUND ---------------------------------------------------------------- 1996 1995 1996 1995 ---------------------------------------------------------------- OPERATIONS: Net investment income $ 1,896,465 $ 4,149,627 $ 6,511,952 $ 11,343,977 Net realized gain (loss) 2,387 5,356 1,132,316 622,733 Net change in unrealized appreciation or depreciation -- -- 1,041,963 9,413,001 ---------------------------------------------------------------- Net increase in net assets resulting from operations 1,898,852 4,154,983 8,686,231 21,379,711 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income (1,896,465) (4,149,626) (7,360,821) (12,039,383) Distributions from net realized gain -- -- -- -- Distributions in excess of net realized gain -- -- -- -- BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 49,197,411 (24,289,814) 20,930,960 28,412,143 ----------------------------------------------------------------- NET ASSETS: Total increase (decrease) 49,199,798 (24,284,457) 22,256,370 37,752,471 Beginning of period 65,386,460 89,670,917 133,450,780 95,698,309 ----------------------------------------------------------------- End of period $ 114,586,258 $ 65,386,460 $ 155,707,150 $ 133,450,780 =================================================================
OPPENHEIMER BOND FUND ------------------------------ 1996 1995 ------------------------------ OPERATIONS: Net investment income $ 8,009,809 $ 11,813,502 Net realized gain (loss) 35,266 1,310,131 Net change in unrealized appreciation or depreciation (7,769,093) 13,318,419 ------------------------------ Net increase in net assets resulting from operations 275,982 26,442,052 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income (8,450,650) (11,209,883) Distributions from net realized gain (133,010) -- Distributions in excess of net realized gain -- -- BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 114,692,808 60,932,217 ------------------------------ NET ASSETS: Total increase (decrease) 106,385,130 76,164,386 Beginning of period 211,231,770 135,067,384 ------------------------------ End of period $ 317,616,900 $ 211,231,770 ==============================
See accompanying Notes to Financial Statements. 80 98 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Changes in Net Assets(Continued) FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited) AND THE YEAR ENDED DECEMBER 31, 1995
OPPENHEIMER CAPITAL OPPENHEIMER APPRECIATION GROWTH FUND FUND -------------------------------------------------------------- 1996 1995 1996 1995 -------------------------------------------------------------- OPERATIONS: Net investment income $ 115,423 $ 1,123,451 $ 704,057 $ 1,297,719 Net realized gain (loss) 24,183,340 22,379,477 5,982,807 8,674,291 Net change in unrealized appreciation or depreciation 42,038,100 47,042,428 7,033,727 16,396,856 -------------------------------------------------------------- Net increase in net assets resulting from operations 66,336,863 70,545,356 13,720,591 26,368,866 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income (1,132,964) (719,183) (1,310,185) (821,641) Distributions from net realized gain (21,289,430) (363,458) (8,706,724) (973,385) Distributions in excess of net realized gain -- -- -- -- BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 117,553,622 70,167,835 23,308,636 29,852,876 -------------------------------------------------------------- NET ASSETS: Total increase (decrease) 161,468,091 139,630,550 27,012,318 54,426,716 Beginning of period 325,404,091 185,773,541 117,709,890 63,283,174 -------------------------------------------------------------- End of period $486,872,182 $325,404,091 $144,722,208 $117,709,890 ==============================================================
OPPENHEIMER MULTIPLE STRATEGIES FUND ------------------------------ 1996 1995 ---------------------------- OPERATIONS: Net investment income $10,567,752 $16,593,514 Net realized gain (loss) 7,317,446 8,275,324 Net change in unrealized appreciation or depreciation 6,355,568 39,976,755 ---------------------------- Net increase in net assets resulting from operations 24,240,766 64,845,593 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income (11,075,637) (16,066,432) Distributions from net realized gain (9,273,310) (8,717,288) Distributions in excess of net realized gain -- -- BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 36,771,331 49,134,087 ----------------------------- NET ASSETS: Total increase (decrease) 40,663,150 89,195,960 Beginning of period 381,263,164 292,067,204 ----------------------------- End of period $421,926,314 $381,263,164 =============================
See accompanying Notes to Financial Statements. 81 99 OPPENHEIMER VARIABLE ACCOUNT FUNDS Statements of Changes in Net Assets(Continued) FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited) AND THE YEAR ENDED DECEMBER 31, 1995
OPPENHEIMER OPPENHEIMER GLOBAL STRATEGIC SECURITIES BOND FUND FUND -------------------------------------------------------------- 1996 1995 1996 1995 -------------------------------------------------------------- OPERATIONS: Net investment income $ 3,186,202 $ 2,845,513 $2,928,490 $3,514,505 Net realized gain (loss) 722,276 (25,767,883) 796,680 (869,176) Net change in unrealized appreciation or depreciation 28,858,652 31,653,008 (936,200) 2,877,343 -------------------------------------------------------------- Net increase in net assets resulting from operations 32,767,130 8,730,638 2,788,970 5,522,672 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income -- -- (2,760,328) (3,151,540) Distributions from net realized gain -- (8,174,158) -- -- Distributions in excess of net realized gain -- -- -- -- BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 87,597,213 62,580,432 18,499,910 37,406,166 -------------------------------------------------------------- NET ASSETS: Total increase (decrease) 120,364,343 63,136,912 18,528,552 39,777,298 Beginning of period 360,978,833 297,841,921 60,097,613 20,320,315 -------------------------------------------------------------- End of period $481,343,176 $360,978,833 $78,626,165 $60,097,613 ==============================================================
OPPENHEIMER GROWTH & INCOME FUND ---------------------------- 1996 1995(1) ---------------------------- OPERATIONS: Net investment income $ 56,470 $ 4,573 Net realized gain (loss) 1,600,069 27,238 Net change in unrealized appreciation or depreciation 136,841 505,175 ---------------------------- Net increase in net assets resulting from operations 1,793,380 536,986 DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends from net investment income (54,801) (4,891) Distributions from net realized gain (31,219) -- Distributions in excess of net realized gain -- (37) BENEFICIAL INTEREST TRANSACTIONS: Net increase (decrease) in net assets resulting from beneficial interest transactions - Note 2 15,336,880 3,756,393 ---------------------------- NET ASSETS: Total increase (decrease) 17,044,240 4,288,451 Beginning of period 4,288,451 -- ---------------------------- End of period $21,332,691 $4,288,451 ============================
1. For the period from July 5, 1995 (commencement of operations) to December 31, 1995. 82 100 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MONEY FUND Financial Highlights JUNE 30, 1996
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 1992 1991 - ----------------------------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 - ----------------------------------------------------------------------------------------------------------------------------------- Income from investment operations - net investment income and net realized gain .02 .06 .04 .03 .04 .06 Dividends and distributions to shareholders (.02) (.06) (.04) (.03) (.04) (.06) - ----------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ===================================================================================== - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) 2.52% 5.62% 4.25% 3.09% 3.93% 6.18% - ----------------------------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $114,586 $65,386 $89,671 $ 61,221 $58,266 $58,709 - ----------------------------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 76,205 $75,136 $90,264 $ 57,654 $61,317 $75,747 - ----------------------------------------------------------------------------------------------------------------------------------- Ratios to average net assets: Net investment income 4.99%(2) 5.52% 4.18% 3.12% 3.76% 5.97% Expenses 0.48%(2) 0.51% 0.43% 0.43% 0.50% 0.49%
1. Assumes a hypothetical initial investment on the business day before the first day of the fiscal period, with all dividends reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Total returns are not annualized for periods of less than one full year. Total returns reflect changes in net investment income only. 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. 2. Annualized. See accompanying Notes to Financial Statements. 83 101 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER HIGH INCOME FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 - --------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $10.63 $9.79 $11.02 $9.74 - --------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .49 .98 .94 .82 Net realized and unrealized gain (loss) .17 .94 (1.27) 1.65 - --------------------------------------------------------------------------------------------------------------- Total income (loss) from investment operations .66 1.92 (.33) 2.47 - --------------------------------------------------------------------------------------------------------------- Dividends and distributions to shareholders: Dividends from net investment income (.56) (1.08) (.66) (1.19) Distributions from net realized gain -- -- (.24) -- - --------------------------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders (.56) (1.08) (.90) (1.19) - --------------------------------------------------------------------------------------------------------------- Net asset value, end of period $10.73 $10.63 $9.79 $11.02 =========================================================== - --------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) 6.30% 20.37% (3.18)% 26.34% - --------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $155,707 $133,451 $95,698 $93,011 - --------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $143,730 $115,600 $101,096 $67,000 - --------------------------------------------------------------------------------------------------------------- Ratios to average net assets: Net investment income 9.06% (2) 9.81% 9.15% 10.50% Expenses 0.82% (2) 0.81% 0.67% 0.68% - --------------------------------------------------------------------------------------------------------------- Portfolio turnover rate(3) 57.0% 107.1% 110.1% 135.7%
1992 1991 - --------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $9.40 $7.90 - --------------------------------------------------------------------- Income (loss) from investment operations Net investment income 1.19 1.28 Net realized and unrealized gain (loss) .43 1.30 - --------------------------------------------------------------------- Total income (loss) from investment operations 1.62 2.58 - --------------------------------------------------------------------- Dividends and distributions to sharehold Dividends from net investment income (1.28) (1.08) Distributions from net realized gain -- -- - --------------------------------------------------------------------- Total dividends and distributions to shareholders (1.28) (1.08) - --------------------------------------------------------------------- Net asset value, end of period $9.74 $9.40 ==================== - --------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) 17.92% 33.91 - --------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $40,817 $27,308 - --------------------------------------------------------------------- Average net assets (in thousands) $36,861 $23,663 - --------------------------------------------------------------------- Ratios to average net assets: Net investment income 12.08% 14.26% Expenses 0.73% 0.75% - --------------------------------------------------------------------- Portfolio turnover rate(3) 144.2% 108.0
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $81,578,215 and $73,441,819, respectively. See accompanying Notes to Financial Statements. 84 102 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER BOND FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 - --------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $11.84 $10.78 $11.65 $10.99 - --------------------------------------------------------------------------------------------------------------- --- Income (loss) from investment operations: Net investment income .33 .72 .76 .65 Net realized and unrealized gain (loss) (.37) 1.07 (.98) .76 - --------------------------------------------------------------------------------------------------------------- Total income (loss) from investment operations (.04) 1.79 (.22) 1.41 - --------------------------------------------------------------------------------------------------------------- Dividends and distributions to shareholders: Dividends from net investment income (.37) (.73) (.62) (.75) Distributions from net realized gain (.01) (.03) -- - --------------------------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders (.38) (.73) (.65) (.75) - --------------------------------------------------------------------------------------------------------------- Net asset value, end of period $11.42 $11.84 $10.78 $11.65 =========================================================== - -------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) (0.33)% 17.00% (1.94)% 13.04% - -------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $317,617 $211,232 $135,067 $111,846 - -------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $236,650 $170,929 $121,884 $87,215 - -------------------------------------------------------------------------------------------------------------- Ratios to average net assets: Net investment income 6.79% (2) 6.91% 7.30% 7.20% Expenses 0.78% (2) 0.80% 0.57% 0.46% - -------------------------------------------------------------------------------------------------------------- Portfolio turnover rate(3) 40.2% 79.4% 35.1% 36.3%
1992 1991 ---------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $11.15 $10.33 - ----------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .87 .95 Net realized and unrealized gain (loss) (.17) .80 - ----------------------------------------------------------------------------- Total income (loss) from investment operation .70 1.75 - ----------------------------------------------------------------------------- Dividends and distributions to shareholders: Dividends from net investment income (.86) (.93) Distributions from net realized gain -- -- - ----------------------------------------------------------------------------- Total dividends and distributions to shareholders (.86) (.93) - ----------------------------------------------------------------------------- Net asset value, end of period $10.99 $11.15 ====================== - ----------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) 6.50% 17.63% - ----------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $63,354 $32,762 - ----------------------------------------------------------------------------- Average net assets (in thousands) $45,687 $22,169 - ----------------------------------------------------------------------------- Ratios to average net assets: Net investment income 7.81% 8.73% Expenses 0.56% 0.64% - ----------------------------------------------------------------------------- Portfolio turnover rate(3) 41.3% 7.6%
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $194,115,687 and $84,471,602, respectively. See accompanying Notes to Financial Statements. 85 103 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER CAPITAL APPRECIATION FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 1992 1991 - ------------------------------------------------------------------------------------------------------------------------------ PER SHARE OPERATING DATA: Net asset value, beginning of period $ 34.21 $ 25.95 $ 31.64 $ 26.04 $ 23.24 $ 15.24 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income -- .11 .10 .05 .06 .08 Net realized and unrealized gain (loss) 6.26 8.29 (2.22) 6.71 3.43 8.18 - ------------------------------------------------------------------------------------------------------------------------------ Total income (loss) from investment operations 6.26 8.40 (2.12) 6.76 3.49 8.26 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and distributions to shareholders: Dividends from net investment income (.11) (.09) (.04) (.06) (.14) (.26) Distributions from net realized gain (2.07) (.05) (3.53) (1.10) (.55) -- - ------------------------------------------------------------------------------------------------------------------------------ Total dividends and distributions to shareholders (2.18) (.14) (3.57) (1.16) (.69) (.26) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $ 38.29 $ 34.21 $ 25.95 $ 31.64 $ 26.04 $ 23.24 ============================================================================ - ------------------------------------------------------------------------------------------------------------------------------ TOTAL RETURN, AT NET ASSET VALUE(1) 18.92% 32.52% (7.59)% 27.32% 15.42% 54.72% - ------------------------------------------------------------------------------------------------------------------------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $486,872 $325,404 $185,774 $136,885 $83,335 $49,371 - ------------------------------------------------------------------------------------------------------------------------------ Average net assets (in thousands) $402,843 $240,730 $153,832 $ 98,228 $56,371 $34,887 Ratios to average net assets: Net investment income 0.06%(2) 0.47% 0.50% 0.23% 0.30% 0.81% Expenses 0.76%(2) 0.78% 0.57% 0.47% 0.54% 0.63% - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate(3) 54.6% 125.5% 96.5% 122.8% 78.9% 122.3% Average brokerage commission rate(4) $ 0.0677 $ 0.0577 -- -- -- --
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $232,545,916 and $191,854,268, respectively. 4. Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period divided by the total of related shares purchased and sold. See accompanying Notes to Financial Statements. 86 104 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 1992 1991 - ------------------------------------------------------------------------------------------------------------------------------ PER SHARE OPERATING DATA: Net asset value, beginning of period $ 23.55 $ 17.68 $ 17.70 $ 16.96 $ 15.17 $12.54 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income .11 .25 .22 .46 .16 .30 Net realized and unrealized gain (loss) 2.49 6.10 (.05) .74 1.99 2.82 - ------------------------------------------------------------------------------------------------------------------------------ Total income (loss) from investment operations 2.60 6.35 .17 1.20 2.15 3.12 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and distributions to shareholders: Dividends from net investment income (.25) (.22) (.15) (.14) (.36) (.49) Distributions from net realized gain (1.67) (.26) (.04) (.32) -- -- - ------------------------------------------------------------------------------------------------------------------------------ Total dividends and distributions to shareholders (1.92) (.48) (.19) (.46) (.36) (.49) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $ 24.23 $ 23.55 $ 17.68 $ 17.70 $ 16.96 $ 15.17 =========================================================================== - ------------------------------------------------------------------------------------------------------------------------------ TOTAL RETURN, AT NET ASSET VALUE(1) 11.37% 36.65% 0.97% 7.25% 14.53% 25.54% - ------------------------------------------------------------------------------------------------------------------------------ RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $144,722 $117,710 $63,283 $56,701 $36,494 $22,032 - ------------------------------------------------------------------------------------------------------------------------------ Average net assets (in thousands) $131,211 $ 88,803 $59,953 $46,389 $25,750 $18,810 - ------------------------------------------------------------------------------------------------------------------------------ Ratios to average net assets: Net investment income 1.08%(2) 1.46% 1.38% 1.13% 1.36% 2.82% Expenses 0.78%(2) 0.79% 0.58% 0.50% 0.61% 0.70% - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate(3) 27.7% 58.2% 53.8% 12.6% 48.7% 133.9% Average brokerage commission rate(4) $ 0.0572 $ 0.0590 -- -- -- --
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $38,780,897 and $30,005,422, respectively. 4. Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period divided by the total number of related shares purchased and sold. See accompanying Notes to Financial Statements. 87 105 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER MULTIPLE STRATEGIES FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 1992 1991 - --------------------------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $14.55 $12.91 $13.88 $12.47 $11.96 $10.90 - --------------------------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .37 .66 .63 .55 .55 .69 Net realized and unrealized gain (loss) .52 2.00 (.90) 1.41 .50 1.15 - --------------------------------------------------------------------------------------------------------------------------------- Total income (loss) from investment operations .89 2.66 (.27) 1.96 1.05 1.84 - --------------------------------------------------------------------------------------------------------------------------------- Dividends and distributions to shareholders: Dividends from net investment income (.40) (.65) (.60) (.55) (.54) (.78) Distributions from net realized gain (.35) (.37) (.10) -- -- -- - --------------------------------------------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders (.75) (1.02) (.70) (.55) (.54) (.78) - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $14.69 $14.55 $12.91 $13.88 $12.47 $11.96 ============================================================================= - --------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE(1) 6.18% 21.36% (1.95%) 15.95% 8.99% 17.48% - --------------------------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $421,926 $381,263 $292,067 $250,290 $159,464 $124,634 - --------------------------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $404,869 $344,745 $279,949 $199,954 $139,011 $117,000 - --------------------------------------------------------------------------------------------------------------------------------- Ratios to average net assets: Net investment income 5.25%(2) 4.81% 4.90% 4.44% 4.63% 5.95% Expenses 0.77%(2) 0.77% 0.56% 0.48% 0.55% 0.54% - --------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate(3) 15.7% 39.0% 31.4% 32.4% 57.8% 80.3% Average brokerage commission rate(4) $0.0310 $0.0329 -- -- -- --
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $76,723,721 and $53,523,995, respectively. 4. Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period divided by the total number of related shares purchased and sold. See accompanying Notes to Financial Statements. 88 106 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GLOBAL SECURITIES FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (UNAUDITED) 1995 1994 1993 1992 1991 - ------------------------------------------------------------------------------------------------------------------------------ PER SHARE OPERATING DATA: Net asset value, beginning of period $15.00 $15.09 $16.30 $9.57 $10.38 $10.04 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income (loss) .11 .12 .04 (.02) .07 .04 Net realized and unrealized gain (loss) 1.13 .19 (.96) 6.75 (.80) .30 - ------------------------------------------------------------------------------------------------------------------------------ Total income (loss) from investment operations 1.24 .31 (.92) 6.73 (.73) .34 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and distributions to shareholders: Dividends from net investment income -- -- (.04) -- (.04) -- Distributions from net realized gain -- (.40) (.25) -- (.04) -- - ------------------------------------------------------------------------------------------------------------------------------ Total dividends and distributions to shareholders -- (.40) (.29) -- (.08) -- - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $16.24 $15.00 $15.09 $16.30 $9.57 $10.38 ============================================================================= ============================================================================================================================== TOTAL RETURN, AT NET ASSET VALUE(1) 8.27% 2.24% (5.72)% 70.32% (7.11)% 3.39% ============================================================================================================================== RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $481,343 $360,979 $297,842 $96,425 $13,537 $7,339 - --------------------------------------------------------------------------- ------------------------------------------------- Average net assets (in thousands) $423,899 $332,336 $214,545 $31,696 $11,181 $3,990 - ------------------------------------------------------------------------------------------------------------------------------ Ratios to average net assets: Net investment income 1.51(2) 0.86% 0.54% 0.72% 1.04% 0.75% Expenses 0.83(2) 0.89% 0.91% 0.92% 1.06% 1.32% - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate(3) 48.1% 131.3% 70.4% 65.1% 34.1% 29.5% Average brokerage commission rate(4) $0.0047 $0.0092 -- -- -- --
1. Assumes a hypothetical initial 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 of 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. 2. Annualized. 3. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $289,298,449 and $193,923,292, respectively. 4. Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period divided by the total number of related shares purchased and sold. See accompanying Notes to Financial Statements. 89 107 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER STRATEGIC BOND FUND Financial Highlights (Continued)
SIX MONTHS ENDED JUNE 30, 1996 YEAR ENDED DECEMBER 31, (Unaudited) 1995 1994 1993(1) - -------------------------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA: Net asset value, beginning of period $ 4.91 $ 4.60 $ 5.12 $ 5.00 - -------------------------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .21 .38 .35 .10 Net realized and unrealized gain (loss) (.01) .30 (.54) .11 - -------------------------------------------------------------------------------------------------------------------------------- Total income (loss) from investment operations .20 .68 (.19) .21 - -------------------------------------------------------------------------------------------------------------------------------- Dividends and distributions to shareholders: Dividends from net investment income (.19) (.37) (.32) (.09) Distributions from net realized gain -- -- -- -- Distributions in excess of net realized gain -- -- (.01) -- - -------------------------------------------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders (.19) (.37) (.33) (.09) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 4.92 $ 4.91 $ 4.60 $ 5.12 ======================================================= - -------------------------------------------------------------------------------------------------------------------------------- Total Return, at Net Asset Value(2) 4.14% 15.33% (3.78)% 4.25% - -------------------------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $78,626 $60,098 $20,320 $9,887 - -------------------------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $67,533 $37,698 $15,389 $4,259 - -------------------------------------------------------------------------------------------------------------------------------- Ratios to average net assets: Net investment income 8.67%(3) 9.32% 8.36% 5.67%(3) Expenses 0.85%(3) 0.85% 0.87% 0.96%(3) - -------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate(4) 46.1% 87.0% 136.6% 10.9%
1. For the period from May 3, 1993 (commencement of operations) to December 31, 1993. 2. Assumes a hypothetical initial 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 of 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. 3. Annualized. 4. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year of less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $44,216,010 and $25,961,308, respectively. See accompanying Notes to Financial Statements. 90 108 OPPENHEIMER VARIABLE ACCOUNT FUNDS - OPPENHEIMER GROWTH & INCOME FUND Financial Highlights (Continued)
SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, (UNAUDITED) 1995(1) ============================================================================================================================== PER SHARE OPERATING DATA: Net asset value, beginning of period $ 12.51 $ 10.00 - ------------------------------------------------------------------------------------------------------------------------------ Income from investment operations: Net investment income .04 .01 Net realized and unrealized gain 2.31 2.52 - ------------------------------------------------------------------------------------------------------------------------------ Total income from investment operations 2.35 2.53 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and distributions to shareholders: Dividends from net investment income (.04) (.02) Distributions from net realized gain (.05) -- - ------------------------------------------------------------------------------------------------------------------------------ Total dividends and distributions to shareholders (.09) (.02) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $ 14.77 $ 12.51 ===================================================== ============================================================================================================================== TOTAL RETURN, AT NET ASSET VALUE(2) 18.81% 25.25% ============================================================================================================================== RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (in thousands) $ 21,333 $ 4,288 ============================================================================================================================== Average net assets (in thousands) $ 10,659 $ 1,809 ============================================================================================================================== Ratios to average net assets: Net investment income 1.06%(3) 0.50%(3) Expenses 1.32%(3) 2.07%(3) - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate(4) 80.1% 23.7% Average brokerage commission rate(5) $ 0.0603 $ 0.0598
1. For the period from July 5, 1995 (commencement of operations) to December 31, 1995. 2. Assumes a hypothetical initial 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 of 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. 3. Annualized. 4. The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation. Purchases and sales of investment securities (excluding short-term securities) for the period ended June 30, 1996 were $21,134,121 and $7,698,850, respectively. 5. Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period divided by the total number of related shares purchased and sold. See accompanying Notes to Financial Statements. 91 109 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) 1. SIGNIFICANT ACCOUNTING POLICIES Oppenheimer Money Fund (OMF), Oppenheimer High Income Fund (OHIF), Oppenheimer Bond Fund (OBF), Oppenheimer Capital Appreciation Fund (OCAP), Oppenheimer Growth Fund (OGF), Oppenheimer Multiple Strategies Fund (OMSF), Oppenheimer Global Securities Fund (OGSF), Oppenheimer Strategic Bond Fund (OSBF) and Oppenheimer Growth & Income Fund (OGIF) (collectively, the Funds) are separate series of Oppenheimer Variable Account Funds (the Trust), a diversified, open-end management investment company registered under the Investment Company Act of 1940, as amended. The Trust's investment advisor is OppenheimerFunds, Inc. (the Manager). The following is a summary of significant accounting policies consistently followed by the Funds. The Funds' objectives are as follows: OPPENHEIMER MONEY FUND seeks the maximum current income from investments in "money market" securities consistent with low capital risk and the maintenance of liquidity. OPPENHEIMER HIGH INCOME FUND seeks a high level of current income from investments in high yield fixed income securities. OPPENHEIMER BOND FUND primarily seeks a high level of current income from investments in high yield fixed income securities rated "Baa" or better by Moody's or "BBB" or better by Standard & Poor's. Secondarily, this Fund seeks capital growth when consistent with its primary objective. OPPENHEIMER CAPITAL APPRECIATION FUND seeks to achieve capital appreciation by investing in "growth-type" companies. OPPENHEIMER GROWTH FUND seeks to achieve capital appreciation by investing in securities of well-known established companies. OPPENHEIMER MULTIPLE STRATEGIES FUND seeks a total investment return (which includes current income and capital appreciation in the value of its shares) from investments in common stocks and other equity securities, bonds and other debt securities, and "money market" securities. OPPENHEIMER GLOBAL SECURITIES FUND seeks long-term capital appreciation by investing a substantial portion of assets in securities of foreign issuers, "growth-type" companies, cyclical industries and special institutions which are considered to have appreciation possibilities. OPPENHEIMER STRATEGIC BOND FUND seeks a high level of current income principally derived from interest on debt securities and seeks to enhance such income by writing covered call options on: (I) debt securities, (ii) U.S. Government securities, and (iii) lower-rated high yield domestic debt securities. OPPENHEIMER GROWTH & INCOME FUND seeks a high total return (which includes growth in the value of its shares as well as current income) from equity and debt securities. From time to time this Fund may focus on small to medium capitalization common stocks, bonds and convertible securities. INVESTMENT VALUATION. Portfolio securities of OMF are valued on the basis of amortized cost, which approximates market value. Portfolio securities of OHIF, OBF, OCAP, OGF, OMSF, OGSF, OSBF and OGIF are valued at the close of the New York Stock Exchange on each trading day. Listed and unlisted securities for which such information is regularly reported are valued at the last sale price of the day or, in the absence of sales, at values based on the closing bid or asked price or the last sale price on the prior trading day. Long-term and short-term "non-money market" debt securities are valued by a portfolio pricing service approved by the Board of Trustees. Such securities which cannot be valued by the approved portfolio pricing service are valued using dealer-supplied valuations provided the Manager is satisfied that the firm rendering the quotes is reliable and that the quotes reflect current market value, or are valued under consistently applied procedures established by the Board of Trustees to determine fair value in good faith. Short-term "money market type" debt securities having a remaining maturity of 60 days or less are valued at cost (or last determined market value) adjusted for amortization to maturity of any premium or discount. Forward foreign currency exchange contracts are valued based on the closing prices of the forward currency contract rates in the London foreign exchange markets on a daily basis as provided by a reliable bank or dealer. Options are valued based upon the last sale price on the principal exchange on which the option is traded or, in the absence of any transactions that day, the value is based upon the last sale on the prior trading date if it is within the spread between the closing bid and asked prices. If the last sale price is outside the spread, the closing bid or asked price closest to the last reported sale price is used. 92 110 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 1. SIGNIFICANT ACCOUNTING POLICIES (continued) SECURITIES PURCHASED ON A WHEN-ISSUED BASIS. Delivery and payment for securities that have been purchased by OHIF, OBF and OSBF on a forward commitment or when-issued basis can take place a month or more after the transaction date. During the period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The Funds maintain, in segregated accounts with the custodian, assets with a market value equal to the amount of their purchase commitments. The purchase of securities on a when-issued or forward commitment basis may increase the volatility of the Funds' net asset values to the extent the Funds make such purchases while remaining substantially fully invested. In connection with their ability to purchase securities on a when-issued or forward commitment basis, OHIF, OBF and OSBF may enter into mortgage "dollar-rolls" in which the Funds sell securities for delivery in the current month and simultaneously contract with the same counterparty to repurchase similar (same type, coupon and maturity) but not identical securities on a specified future date. The Funds record each dollar-roll as a sale and a new purchase transaction. As of June 30, 1996, OHIF and OSBF had entered into outstanding when-issued or forward commitments of $3,235,962 and $1,244,208, respectively. SECURITY CREDIT RISK. OHIF, OMSF and OSBF invest in high yield securities, which may be subject to a greater degree of credit risk, greater market fluctuations and risk of loss of income and principal, and may be more sensitive to economic conditions than lower yielding, higher rated fixed income securities. The Funds may acquire securities in default, and are not obligated to dispose of securities whose issuers subsequently default. FOREIGN CURRENCY TRANSLATION. The accounting records of the Funds are maintained in U.S. dollars. Prices of securities purchased by OHIF, OBF, OMSF, OGSF, OSBF and OGIF that are denominated in foreign currencies are translated into U.S. dollars at the closing rates of exchange. Amounts related to the purchase and sale of securities and investment income are translated at the rates of exchange prevailing on the respective dates of such transactions. For OHIF, OBF, OMSF, OGSF, OSBF and OGIF, 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 Funds' Statements of Operations. REPURCHASE AGREEMENTS. The Funds require the custodian to take possession, to have legally segregated in the Federal Reserve Book Entry System or to have segregated within the custodian's vault, all securities held as collateral for repurchase agreements. The market value of the underlying securities is required to be at least 102% of the resale price at the time of purchase. If the seller of the agreement defaults and the value of the collateral declines, or if the seller enters an insolvency proceeding, realization of the value of the collateral by the Funds may be delayed or limited. FEDERAL TAXES. The Trust intends for each Fund to continue to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income, including any net realized gain on investments not offset by loss carryovers, to shareholders. Therefore, no federal income or excise tax provision is required. DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders of OHIF, OBF, OCAP, OGF, OMSF, OGSF, OSBF and OGIF are recorded on the ex-dividend date. OMF intends to declare dividends from net investment income each day the New York Stock Exchange is open for business and pay such dividends monthly. To effect its policy of maintaining a net asset value of $1.00 per share, OMF may withhold dividends or make distributions of net realized gains. 93 111 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 1. SIGNIFICANT ACCOUNTING POLICIES (continued) CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income (loss) and net realized gain (loss) may differ for financial statement and tax purposes primarily because of premium amortization, paydown gains and losses and the recognition of certain foreign currency gains (losses) as ordinary income (loss) for tax purposes. The character of the distributions made during the 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 dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gain (loss) was recorded by the Funds. OTHER. Investment transactions are accounted for on the date the investments are purchased or sold (trade date) and dividend income is recorded on the ex-dividend date. Discount on securities purchased by OHIF, OBF, OMSF, OGSF, OSBF and OGIF is amortized over the life of the respective securities, in accordance with federal income tax requirements. Realized gains and losses on investments and unrealized appreciation and depreciation are determined on an identified cost basis, which is the same basis used for federal income tax purposes. Dividends-in-kind are recognized as income on the ex-dividend date, at the current market value of the underlying security. Interest on payment-in-kind debt instruments is accrued as income at the coupon rate, and a market adjustment is made on the ex-date. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities of the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. 2. SHARES OF BENEFICIAL INTEREST The Funds have authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:
OPPENHEIMER MONEY FUND ------------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 ------------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT ------------------------------------------------------------- Sold 191,400,358 $ 191,400,358 202,748,102 $ 202,748,102 Dividends and distributions reinvested 1,901,540 1,901,540 4,222,747 4,222,747 Redeemed (144,104,487) (144,104,487) (231,260,663) (231,260,663) ------------------------------------------------------------- Net increase (decrease) 49,197,411 $ 49,197,411 (24,289,814) $(24,289,814) =============================================================
OPPENHEIMER HIGH INCOME FUND --------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 --------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT --------------------------------------------------------- Sold 4,915,849 $ 53,378,895 5,873,231 $ 60,932,670 Dividends and distributions reinvested 688,571 7,360,821 1,162,957 12,040,152 Redeemed (3,645,899) (39,808,756) (4,263,757) (44,560,679) --------------------------------------------------------- Net increase (decrease) 1,958,521 $ 20,930,960 2,772,431 $ 28,412,143 =========================================================
OPPENHEIMER BOND FUND ------------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 ------------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT ------------------------------------------------------------- Sold 10,641,027 $ 122,534,894 7,311,733 $ 83,544,442 Dividends and distributions reinvested 754,523 8,583,660 976,291 11,209,883 Redeemed (1,414,825) (16,425,746) (2,972,687) (33,822,108) ------------------------------------------------------------- Net increase 9,980,725 $ 114,692,808 5,315,337 $ 60,932,217 =============================================================
OPPENHEIMER CAPITAL APPRECIATION FUND -------------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 -------------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT -------------------------------------------------------------- Sold 5,914,854 $ 217,106,599 8,882,212 $ 260,650,476 Dividends and distributions reinvested 643,582 22,422,394 40,594 1,082,642 Redeemed (3,357,155) (121,975,371) (6,567,729) (191,565,283) ------------------------------------------------------------- Net increase 3,201,281 $ 117,553,622 2,355,077 $ 70,167,835 =============================================================
94 112 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 2. SHARES OF BENEFICIAL INTEREST (continued)
OPPENHEIMER GROWTH FUND OPPENHEIMER MULTIPLE STRATEGIES FUND -------------------------------------------------------------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 JUNE 30, 1996 DECEMBER 31, 1995 -------------------------------------------------------------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT -------------------------------------------------------------------------------------------------------------- Sold 2,328,692 $ 56,424,038 4,302,304 $ 89,007,340 2,802,404 $ 41,511,453 6,445,242 $ 88,771,497 Dividends and distributions reinvested 430,280 10,016,909 95,991 1,795,026 1,394,718 20,348,946 1,818,313 24,783,721 Redeemed (1,783,960) (43,132,311) (2,980,080) (60,949,490) (1,695,281) (25,089,068) (4,671,097) (64,421,131) -------------------------------------------------------------------------------------------------------------- Net increase 975,012 $ 23,308,636 1,418,215 $ 29,852,876 2,501,841 $ 36,771,331 3,592,458 $ 49,134,087 ==============================================================================================================
OPPENHEIMER GLOBAL SECURITIES FUND OPPENHEIMER STRATEGIC BOND FUND ------------------------------------------------------------------------------------------------------------------ SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995 JUNE 30, 1996 DECEMBER 31, 1995 ------------------------------------------------------------------------------------------------------------------ SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT ------------------------------------------------------------------------------------------------------------------ Sold 6,846,766 $ 107,662,261 11,235,722 $ 166,766,446 5,018,279 $ 24,850,711 9,417,090 $ 44,897,472 Dividends and distributions reinvested -- -- 585,961 8,174,158 565,134 2,760,329 661,301 3,151,540 Redeemed (1,283,788) (20,065,048) (7,497,205) (112,360,172) (1,844,209) (9,111,130) (2,245,623) (10,642,846) ------------------------------------------------------------------------------------------------------------------ Net increase 5,562,978 $ 87,597,213 4,324,478 $ 62,580,432 3,739,204 $ 18,499,910 7,832,768 $ 37,406,166 ==================================================================================================================
OPPENHEIMER GROWTH & INCOME FUND --------------------------------------------------------- SIX MONTHS ENDED YEAR ENDED JUNE 30, 1996 DECEMBER 31, 1995(1) --------------------------------------------------------- SHARES AMOUNT SHARES AMOUNT --------------------------------------------------------- Sold 1,194,344 $ 16,678,916 358,253 $3,933,459 Dividends and distributions reinvested 6,082 86,020 404 4,928 Redeemed (98,746) (1,428,056) (15,863) (181,994) --------------------------------------------------------- Net increase 1,101,680 $ 15,336,880 342,794 $3,756,393 =========================================================
(1) For the period from July 5, 1995 (commencement of operations) to December 31, 1995. 95 113 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS At June 30, 1996, net unrealized appreciation or depreciation on investments and options written consisted of the following:
OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL OPPENHEIMER HIGH INCOME BOND APPRECIATION GROWTH FUND FUND FUND FUND ---------------------------------------------------------------------------------- Gross appreciation $ 8,794,461 $ 4,733,340 $ 117,871,439 $ 32,672,573 Gross depreciation (2,106,142) (3,709,869) (12,857,992) (2,020,923) ---------------------------------------------------------------------------------- Net unrealized appreciation $ 6,688,319 $ 1,023,471 $ 105,013,447 $ 30,651,650 ==================================================================================
OPPENHEIMER OPPENHEIMER MULTIPLE OPPENHEIMER STRATEGIC OPPENHEIMER STRATEGIES GLOBAL SECURITIES BOND GROWTH & INCOME FUND FUND FUND FUND ---------------------------------------------------------------------------------- Gross appreciation $ 56,500,149 $ 61,150,793 $ 1,988,083 $ 1,171,212 Gross depreciation (7,989,109) (10,549,493) (1,076,472) (529,196) ---------------------------------------------------------------------------------- Net unrealized appreciation $ 48,511,040 $ 50,601,300 $ 911,611 $ 642,016 ==================================================================================
4. OPTION ACTIVITY The Funds (except OMF) may buy and sell put and call options, or write put and covered call options on portfolio securities in order to produce incremental earnings or protect against changes in the value of portfolio securities. The Funds generally purchase put options or write covered call options to hedge against adverse movements in the value of portfolio holdings. When an option is written, the Funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. Options are valued daily based upon the last sale price on the principal exchange on which the option is traded and unrealized appreciation or depreciation is recorded. The Funds will realize a gain or loss upon the expiration or closing of the option transaction. When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option is adjusted by the amount of premium received or paid. Securities designated to cover outstanding call options are noted in the Statements of Investments where applicable. Shares subject to call, expiration date, exercise price, premium received and market value are detailed in a footnote to the Statements of Investments. Options written are reported as a liability in the Statements of Assets and Liabilities. Gains and losses are reported in the Statements of Operations. The risk in writing a call option is that the Funds give up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Funds may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Funds pay a premium whether or not the option is exercised. The Funds also have the additional risk of not being able to enter into a closing transaction if a liquid secondary market does not exist. The Funds may also write over-the-counter options where the completion of the obligation is dependent upon the credit standing of the counterparty. 96 114 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 4. OPTION ACTIVITY (continued) OHIF option activity for the six months ended June 30, 1996 was as follows:
CALL OPTIONS ---------------------------------------- NUMBER OF AMOUNT OF OPTIONS PREMIUMS ---------------------------------------- Options outstanding at December 31, 1995 100 $ 1,430 Options written 2,995,422 60,892 Options canceled in closing transactions (990,415) (27,918) Options expired prior to exercise (711,177) (13,160) Options exercised (495,479) (4,069) ---------------------------------------- Options outstanding at June 30, 1996 798,451 $ 17,175 ========================================
OBF option activity for the six months ended June 30, 1996 was as follows:
CALL OPTIONS ----------------------------------------- NUMBER OF AMOUNT OF OPTIONS PREMIUMS ----------------------------------------- Options outstanding at December 31, 1995 -- $ -- Options written 6,637,802 115,114 Options canceled in closing transactions (1,980,331) (47,726) Options expired prior to exercise (1,460,029) (26,575) Options exercised (1,195,442) (9,818) ----------------------------------------- Options outstanding at June 30, 1996 2,002,000 $ 30,995 =========================================
OMSF option activity for the six months ended June 30, 1996 was as follows:
CALL OPTIONS ---------------------------------------- NUMBER OF AMOUNT OF OPTIONS PREMIUMS ---------------------------------------- Options outstanding at December 31, 1995 3,603 $1,100,095 Options written 3,584 937,173 Options canceled in closing transactions (1,003) (338,500) Options expired prior to exercise (2,521) (692,359) Options exercised (678) (196,972) ---------------------------------------- Options outstanding at June 30, 1996 2,985 $ 809,437 ========================================
OSBF option activity for the six months ended June 30, 1996 was as follows:
CALL OPTIONS --------------------------------------- NUMBER OF AMOUNT OF OPTIONS PREMIUMS --------------------------------------- Options outstanding at December 31, 1995 1,000 $ 14,299 Options written 4,625,262 66,992 Options canceled in closing transactions (1,150) (16,925) Options expired prior to exercise (1,616,402) (21,688) Options exercised (1,178,560) (8,226) --------------------------------------- Options outstanding at June 30, 1996 1,830,150 $ 34,452 =======================================
97 115 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 4. OPTION ACTIVITY (continued) OGIF option activity for the six months ended June 30, 1996 was as follows:
CALL OPTIONS --------------------------------------- NUMBER OF AMOUNT OF OPTIONS PREMIUMS --------------------------------------- Options outstanding at December 31, 1995 -- $ -- Options written 19 6,301 Options expired prior to exercise (12) (1,764) --------------------------------------- Options outstanding at June 30, 1996 7 $ 4,537 =======================================
5. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS A forward foreign currency exchange contract (forward contract) is a commitment to purchase or sell a foreign currency at a future date, at a negotiated rate. The Funds (except OMF) use forward contracts to seek to manage foreign currency risks. They may also be used to tactically shift portfolio currency risk. The Funds generally enter into forward contracts as a hedge upon the purchase or sale of a security denominated in a foreign currency. In addition, the Funds may enter into such contracts as a hedge against changes in foreign currency exchange rates on portfolio positions. Forward contracts are valued based on the closing prices of the forward currency contract rates in the London foreign exchange markets on a daily basis as provided by a reliable bank or dealer. The Funds will realize a gain or loss upon the closing or settlement of the forward transaction. Securities held in segregated accounts to cover net exposure on outstanding forward contracts are noted in the Statements of Investments where applicable. Unrealized appreciation or depreciation on forward contracts is reported in the Statements of Assets and Liabilities. Realized gains and losses are reported with all other foreign currency gains and losses in the Funds' Statements of Operations. Risks include the potential inability of the counterparty to meet the terms of the contract and unanticipated movements in the value of a foreign currency relative to the U.S. dollar. At June 30, 1996, outstanding forward contracts to purchase and sell foreign currencies were as follows:
OPPENHEIMER HIGH INCOME FUND - ---------------------------- CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED CONTRACTS TO PURCHASE EXPIRATION DATE (000'S) JUNE 30, 1996 APPRECIATION DEPRECIATION - ----------------------------------------------------------------------------------------------------------------------------- Italian Lira (ITL) 5/9/97 628,510 ITL $ 402,139 $ 7,865 $ -- German Deutsche Mark (DEM) 7/1/96 181 DEM 118,685 321 -- ----------- --------- --------- $ 520,824 8,186 -- =========== --------- --------- CONTRACTS TO SELL - ----------------- Swiss Franc (CHF) 7/18/96-6/26/97 3,145 CHF $ 2,550,344 $ 18,427 $ 8,511 Japanese Yen (JPY) 8/26/96-4/14/97 94,375 JPY 886,549 59,783 -- ----------- --------- --------- $ 3,436,893 78,210 8,511 =========== --------- --------- Total Unrealized Appreciation and Depreciation $ 86,396 $ 8,511 ========= =========
OPPENHEIMER BOND FUND - --------------------- CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED CONTRACTS TO PURCHASE EXPIRATION DATE (000'S) JUNE 30, 1996 APPRECIATION DEPRECIATION - ------------------------------------------------------------------------------------------------------------------------------- Italian Lira (ITL) 5/9/97 671,747 ITL $ 429,803 $ 7,629 $ -- CONTRACTS TO SELL Japanese Yen (JPY) 8/26/96 43,000 JPY $ 396,015 $ 4,749 $ -- Swiss Franc (CHF) 7/18/96-5/6/97 12,703 CHF 10,233,684 32,135 15,592 ------------- -------- ----------- $ 10,629,699 36,884 15,592 ============= -------- ----------- Total Unrealized Appreciation and Depreciation $ 44,513 $ 15,592 ======== ===========
98 116 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 5. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS (continued)
OPPENHEIMER GLOBAL SECURITIES FUND - ---------------------------------- CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED CONTRACTS TO PURCHASE EXPIRATION DATE (000'S) JUNE 30, 1996 APPRECIATION DEPRECIATION - -------------------------------------------------------------------------------------------------------------------------- Austrian Schilling (ATS) 7/8/96 10,939 ATS $ 1,021,486 $ 587 $ -- Indonesian Rupiah (IDR) 7/19/96 577,500 IDR 247,097 -- 14 Italian Lira (ITL) 7/4/96 641,785 ITL 418,477 -- 410 Japanese Yen (JPY) 7/1/96-7/3/96 120,146 JPY 1,095,678 -- 3,702 Norwegian Krone (NOK) 7/1/96-7/2/96 2,268 NOK 349,071 -- 399 South African Rand (ZAR) 7/1/96 15,406 ZAR 3,557,698 3,159 -- Swedish Krona (SEK) 7/1/96 3,726 SEK 561,597 -- 1,058 ------------ ---------- ---------- $ 7,251,104 3,746 5,583 ============ ---------- ---------- CONTRACTS TO SELL Argentine Peso (ARP) 7/1/96-7/2/96 267 ARP $ 267,003 $ -- $ 511 French Franc (FRF) 7/31/96 10,133 FRF 1,972,699 -- 15,563 German Deutsche Mark (DEM) 1/8/97 28,680 DEM 19,070,993 929,007 -- Japanese Yen (JPY) 9/30/96 1,475,100 JPY 13,646,090 12,244 -- Swiss Franc (CHF) 10/8/96 17,204 CHF 13,852,778 1,147,222 -- ----------- ---------- ---------- $48,809,563 2,088,473 16,074 =========== ---------- ---------- Total Unrealized Appreciation and Depreciation $2,092,219 $ 21,657 ========== ==========
OPPENHEIMER STRATEGIC BOND FUND - ------------------------------- CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED CONTRACTS TO PURCHASE EXPIRATION DATE (000'S) JUNE 30, 1996 APPRECIATION DEPRECIATION - -------------------------------------------------------------------------------------------------------------------------- Japanese Yen (JPY) 7/5/96 12,467 JPY $ 113,774 $ -- $ 1,713 ============ ----------- ------------ CONTRACTS TO SELL Australian Dollar (AUD) 7/3/96 22 AUD $ 17,022 $ -- $ 36 Finnish Markka (FIM) 8/4/96 4,679 FIM 1,012,159 -- 12,146 Japanese Yen (JPY) 9/5/96-12/18/96 45,175 JPY 421,276 34,104 -- Swiss Franc (CHF) 7/8/96-8/28/96 3,316 CHF 2,656,791 -- 22,191 ------------ ----------- ----------- $ 4,107,248 34,104 34,373 ============ ----------- ----------- Total Unrealized Appreciation and Depreciation $ 34,104 $ 36,086 =========== ==========
6. FUTURES CONTRACTS The Funds (except OMF) may buy and sell interest rate futures contracts in order to gain exposure to or protect against changes in interest rates. The Funds may also buy or write put or call options on these futures contracts. The Funds generally sell futures contracts to hedge against increases in interest rates and the resulting negative effect on the value of fixed rate portfolio securities. The Funds may also purchase futures contracts to gain exposure to changes in interest rates as it may be more efficient or cost effective than actually buying fixed income securities. Upon entering into a futures contract, the Funds are required to deposit either cash or securities in an amount (initial margin) equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the Funds 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 Funds recognize a realized gain or loss when the contract is closed or expires. Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Statements of Investments. The Statements of Assets and Liabilities reflect a receivable or payable for the daily mark to market for variation margin. 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. 99 117 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 6. FUTURES CONTRACTS (continued) At June 30, 1996, OSBF had outstanding futures contracts to sell debt securities as follows:
Number of Valuation as of Unrealized Expiration Date Futures Contracts June 30, 1996 Depreciation - ------------------------------------------------------------------------------------------------ U.S. Treasury Nts. 9/96 6 $634,500 $6,750
7. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES Management fees paid to the Manager were in accordance with the investment advisory agreements with the Trust. For OBF, OCAP, OGF, OMSF, OHIF, OGSF, OSBF and OGIF, the annual fees are 0.75% of the first $200 million of net assets, 0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the next $200 million and 0.60% of net assets in excess of $800 million. In addition, management fees for OHIF, OBF and OSBF are 0.50% of net assets in excess of $1 billion. Management fees for OMF are 0.45% of the first $500 million, 0.425% of the next $500 million, 0.40% of the next $500 million and 0.375% of net assets in excess of $1.5 billion. For OSBF, the Manager has agreed to limit the management fee charged so that the ordinary operating expenses of the Fund will not exceed 1.0% of its average net assets in any fiscal year. 8. ILLIQUID AND RESTRICTED SECURITIES At June 30, 1996, investments in securities included issues that are illiquid or restricted. The securities are often purchased in private placement transactions, are not registered under the Securities Act of 1933, may have contractual restrictions on resale, and are valued under methods approved by the Board of Trustees as reflecting fair value. A security may also be considered illiquid if its valuation has not changed for a certain period of time. The Funds intend to invest no more than 10% of net assets (determined at the time of purchase and reviewed from time to time) in illiquid or restricted securities. Information concerning these securities is as follows: OPPENHEIMER HIGH INCOME FUND
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ----------------------------------------------------------------------------------------------------------- Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A, 6.812%, 9/4/06 3/13/96 $ 54.75 $ 59.69 Ames Department Stores, Inc.: Excess Cash Flow Payment Certificates, Series 12/30/92 $ 0.00 $ 0.01 AG-7A Litigation Trust 12/30/92 $ 0.00 $ 0.01 Australis Media Ltd. Common Stock 1/16/96-1/25/96 $ 1.19 $ 0.34 Berg Electronics Corp. Common Stock 4/28/93-8/11/93 $ 4.89 $ 22.56 CBA Mortgage Corp., Mtg. Pass-Through Certificates, Series 1993-C1, Cl. F, 7.153%, 8/23/95 $ 72.52 $ 74.81 12/25/03 Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 12/05/95 $ 92.00 $ 93.25 ECM Fund, L.P.I.: Common Stock 4/14/92 $1,000.00 $1,000.00 14% Sub. Nts., 6/10/02 4/14/92 $ 100.00 $ 110.00 Equitable Bag, Inc. Common Stock 12/16/94 $ 1.50 $ 2.50 Farley, Inc., Zero Coupon Sub. Debs., 14.143%, 1/1/93-3/6/95 $ 7.44 $ 10.60 12/30/12 Foamex LP/JPS Automotive Corp. Wts., Exp. 7/99 6/21/94 $ 0.00 $ 5.00 Gillett Holdings, Inc.: Common Stock 12/1/92-1/18/96 $ 16.27 $ 30.00 12.25% Sr. Sub. Nts., Series A, 6/30/02 12/23/92 $ 101.87 $ 105.37 Goldman, Sachs & Co., Argentina Local Market Securities Trust, 11.30%, 4/1/00 8/24/94 $ 100.00 $ 92.75 Omnipoint Corp. Common Stock 1/26/96 $ 16.00 $ 24.70 Pulsar Internacional SA de CV, 11.80% Nts., 9/14/95 $ 100.00 $ 100.50 9/19/96
100 118 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 8. ILLIQUID AND RESTRICTED SECURITIES (continued) OPPENHEIMER HIGH INCOME FUND (continued)
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ------------------------------------------------------------------------------------------------ Triangle Wire & Cable, Inc. Common Stock 5/2/94 $9.50 $ 1.00 Trinidad & Tobago Loan Participation Agreement, Tranche B, 1.772%, 9/30/00 12/13/95- 4/1/96 $0.82 $0 .78
The aggregate value of illiquid or restricted securities subject to this 10% limitation at June 30, 1996 was $6,685,781, or 4.29% of the Fund's net assets. Pursuant to guidelines adopted by the Board of Trustees, certain unregistered securities are determined to be liquid and are not included within the 10% limitation specified above. OPPENHEIMER BOND FUND
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ------------------------------------------------------------------------------------------------ Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 12/5/95 $ 92.00 $ 93.25 Merrill Lynch & Co., Inc. Units, 9.75%, 6/15/99 5/15/95 $110.05 $113.82
The aggregate value of illiquid or restricted securities subject to this 10% limitation at June 30, 1996 was $2,603,717, or 0.82% of the Fund's net assets. Pursuant to guidelines adopted by the Board of Trustees, certain unregistered securities are determined to be liquid and are not included within the 10% limitation specified above. OPPENHEIMER MULTIPLE STRATEGIES FUND
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ------------------------------------------------------------------------------------------------ Santa Anita Realty Enterprises, Inc., Units 5/28/93- 2/9/95 $16.99 $12.63
The aggregate value of illiquid or restricted securities subject to this 10% limitation at June 30, 1996 was $505,000, or 0.12% of the Fund's net assets. Pursuant to guidelines adopted by the Board of Trustees, certain unregistered securities are determined to be liquid and are not included within the 10% limitation specified above. OPPENHEIMER GLOBAL SECURITIES FUND
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ------------------------------------------------------------------------------------------------ Plant Genetics Systems Common Stock 5/27/92-3/7/95 $13.77 $11.18 Plant Genetics Systems Wts., Exp. 12/99 3/7/95 $ 0.00 $ 1.87
The aggregate value of illiquid or restricted securities subject to this 10% limitation at June 30, 1996, was $1,108,624, or 0.23% of the Fund's net assets. Pursuant to the guidelines adopted by the Board of Trustees, certain unregistered securities are determined to be liquid and are not included within the 10% limitation specified above. 101 119 OPPENHEIMER VARIABLE ACCOUNT FUNDS NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued) 8. ILLIQUID AND RESTRICTED SECURITIES (continued) OPPENHEIMER STRATEGIC BOND FUND
VALUATION PER ACQUISITION COST UNIT AS OF SECURITY DATE PER UNIT JUNE 30, 1996 - ----------------------------------------------------------------------------------------------------------------------- Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A, 6.812%, 9/4/06 3/13/96-3/21/96 $ 55.04 $ 59.69 Colombia (Republic of) 1989-1990 Integrated Loan Facility Bonds, 6.563%, 7/1/01 12/5/95 $ 92.00 $ 93.25 Gillett Holdings, Inc. Common Stock 1/18/96 $ 21.25 $ 30.00 Goldman, Sachs & Co., Argentina Local Market Securities Trust, 11.30%, 4/1/00 8/24/94 $100.00 $ 92.75 Jamaica (Government of) 1990 Refinancing Agreement Nts.: 8/15/95 $ 89.75 $ 95.75 Tranche A, 6.344%, 10/16/00 Tranche B, 6.312%, 11/15/04 5/8/96 $ 75.88 $ 78.25 Pulsar Internacional SA de CV, 11.80% Nts., 9/15/95 $100.00 $100.50 9/19/96 Transpower Finance Ltd., 8% Gtd. Unsec. Unsub. Bonds, 2/15/01 5/17/96 $ 66.17 $ 64.76 Trinidad & Tobago Loan Participation Agreement, 12/13/95-12/18/95 $ 0.84 $ 0.78 Tranche A, 1.772%, 9/30/00 United Mexican States, Combined Facility 3, Loan Participation Agreement, Tranche A, 6.563%, 10/25/94 $ 89.00 $ 83.50 9/20/97
The aggregate value of illiquid or restricted securities subject to this 10% limitation at June 30, 1996, was $2,512,959, or 3.20% of the Fund's net assets. Pursuant to the guidelines adopted by the Board of Trustees, certain unregistered securities are determined to be liquid and are not included within the 10% limitation specified above. 102 120 OPPENHEIMER VARIABLE ACCOUNT FUNDS OFFICERS AND TRUSTEES James C. Swain, Chairman and Chief Executive Officer Bridget A. Macaskill, President and Trustee Robert G. Avis, Trustee William A. Baker, Trustee Charles Conrad, Jr., Trustee Jon S. Fossel, Trustee Sam Freedman, Trustee Raymond J. Kalinowski, Trustee C. Howard Kast, Trustee Robert M. Kirchner, Trustee Ned M. Steel, Trustee George C. Bowen, Vice President, Treasurer and Assistant Secretary Andrew J. Donohue, Vice President and Secretary Paul LaRocco, Vice President Robert J. Milnamow, Vice President David P. Negri, Vice President Jane Putnam, Vice President Richard H. Rubinstein, Vice President Arthur P. Steinmetz, Vice President Dorothy G. Warmack, Vice President William Wilby, Vice President Robert J. Bishop, Assistant Treasurer Scott T. Farrar, Assistant Treasurer Robert G. Zack, Assistant Secretary INVESTMENT ADVISOR OppenheimerFunds, Inc. TRANSFER AGENT OppenheimerFunds Services CUSTODIAN OF PORTFOLIO SECURITIES The Bank of New York INDEPENDENT AUDITORS Deloitte & Touche LLP LEGAL COUNSEL Myer, Swanson, Adams & Wolf, P.C. The financial statements included herein have been taken from the records of the Funds without examination by the independent auditors. This is a copy of a report to shareholders of Oppenheimer Variable Account Funds. This report must be preceded or accompanied by a Prospectus of Oppenheimer Variable Account Funds. For material information concerning the Funds, see the Prospectus. Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, and are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested. 103 -----END PRIVACY-ENHANCED MESSAGE-----