N-CSR

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-4108

Oppenheimer Variable Account Funds

(Exact name of registrant as specified in charter)

6803 South Tucson Way, Centennial, Colorado 80112-3924
(Address of principal executive offices) (Zip code)

Arthur S. Gabinet
OppenheimerFunds, Inc.
Two World Financial Center, New York, New York 10281-1008
(Name and address of agent for service)

Registrant’s telephone number, including area code: (303) 768-3200

Date of fiscal year end: December 31

Date of reporting period: 12/30/2011

Item 1. Reports to Stockholders.

OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

Portfolio Manager: Ronald J. Zibelli, Jr., CFA

Average Annual Total Returns
For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		1.09	%		-1.54	%		1.52	%
Service Shares		0.83			-1.80			1.25

Expense Ratios
For the Period Ended 12/30/11¹

	Gross			Net
	Expense			Expense
	Ratios			Ratios
Non-Service Shares		0.84	%		0.80	%
Service Shares		1.09			1.05

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Sector Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of common stocks.

Top Ten Common Stock Holdings

Dollar Tree, Inc.	2.6	%
Alexion Pharmaceuticals, Inc.	2.5
Hansen Natural Corp.	2.2
Kansas City Southern, Inc.	2.1
Concho Resources, Inc.	2.0
HMS Holdings Corp.	1.9
Tractor Supply Co.	1.8
Estee Lauder Cos., Inc. (The), Cl. A	1.7
Gardner Denver, Inc.	1.7
Chipotle Mexican Grill, Inc., Cl. A	1.7

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. During the reporting period, the Fund’s Non-Service shares produced a return of 1.09%.¹ On a relative basis, the Fund outperformed the Russell 2500 Growth Index (the “Index”), which returned -1.57% over the period. The Fund outperformed the Index primarily in the health care and consumer discretionary sectors, where a number of Fund holdings generated solid returns. The Fund also outperformed in industrials and consumer staples. The Fund underperformed the Index primarily in three sectors: information technology, energy and telecommunication services, where weaker relative stock selection detracted from results. The Fund also outperformed the Russell 2000 Growth Index and the Russell MidCap Growth Index, which returned -2.91% and -1.65%, respectively.

Economic and Market Overview

The reporting period began with a sense of market optimism over improving Gross Domestic Product (“GDP”) growth in Europe and the U.S., and equity markets in those regions generally experienced solid gains through the first four months of 2011. After strong gains in 2010, developing market equities generally started the year off lagging their developed market counterparts due to concerns over slowing growth and rising inflation.

     Market volatility across global equity markets grew over the second quarter of 2011 when Greece again teetered on the brink of defaulting on its sovereign debt, rekindling worries that fiscal instability might spread to other parts of Europe. Concerns over the economic problems in other European countries intensified as did a sense of unease over the health of the European banking system. A natural disaster in Japan caused disruptions in supply chains in the information technology sector and the automotive industry. Previously high-flying economies such as Brazil, Australia and India saw their GDP numbers cool off significantly as they struggled to keep their economies from heading into recession. In the U.S., the Fed’s latest round of quantitative easing, labeled “QE2”, officially ended on June 30, adding to questions around what the Fed’s next move might be to help stimulate the U.S. economy. These developments, in addition to persistently high levels of U.S. unemployment and a depressed U.S. housing market, contributed to a weaker-than-expected estimate of U.S. GDP during the second quarter of the year.

     Due to the sluggish economy and lowered expectations for future economic growth, global equities began a decline over the summer that intensified as the third quarter progressed. The markets priced in a renewed sense of pessimism that Europe might succumb to a double-dip recession and that the U.S. was headed for a prolonged period of disappointing growth. Uncertainty and market nervousness grew as a deal to raise the U.S. debt ceiling was not reached until shortly before the deadline. As a result of the intense political wrangling, the credit rating agency Standard & Poor’s took the unprecedented and controversial step of downgrading the debt of the U.S., a decision that the two other major U.S. credit rating agencies opted not to follow. These events, coupled with the high likelihood of a Greek default on its debt and worries that Italy might be next, sent stocks sharply lower over the third quarter of 2011.

     In the fourth quarter, equity markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Top Individual Contributors

Health care was a top performing sector for the Fund during the period, led by two holdings in the pharmaceuticals industry: Alexion Pharmaceuticals, Inc. and Valeant Pharmaceuticals. Alexion Pharmaceuticals, a stock that we have owned for more than three years, continued to perform well. The company’s drug Soliris treats patients with rare, life-threatening blood disorders. In addition to growing quickly in its original indication, Soliris was recently approved for patients in a second indication (an additional medical use) and new clinical data shows the drug may work in a series of related conditions. Alexion management raised guidance every quarter last year as operational performance was excellent. Alexion was the second largest holding of the Fund at period end. Valeant Pharmaceuticals owns a broad

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FUND PERFORMANCE DISCUSSION

portfolio of drugs sold mostly outside of the U.S. The company completed a few significant acquisitions during the year that we believe should allow for steady growth at high margins. The Fund exited its position in Valeant late in the reporting period as the market cap grew above $15 billion.

     Consumer discretionary was the second-best performing sector and outperformance came from a number of holdings. Dollar Tree, Inc. is an operator of discount variety stores that performed particularly well over the closing months of the period, as it benefited from consumers seeking sales in a difficult economic environment. It was the Fund’s top holding at period end. Beauty retailer Ulta Salon, Cosmetics & Fragrance, Inc. reported positive earnings results during the period, continuing a streak of quarters in which it reported earnings above analysts’ estimates. Solid same-store sales, as well as revenue from new stores, benefited the company’s stock price. In addition, Ulta’s success can be attributed to market share shifts in the beauty industry away from department stores and toward specialty stores. Chipotle Mexican Grill, Inc., a fast food chain specializing in burritos and tacos, experienced increased traffic in its stores and continued to grow by opening new locations. Higher prices also benefited the company, and helped combat rising food prices.

     Consumer staples stock Hansen Natural Corp. also contributed positively to performance this period. Hansen Natural, through its subsidiaries, develops and sells specialty beverages in the U.S. and internationally. High demand for the company’s Monster energy drinks was a primary driver of its success.

Top Individual Detractors

Holdings that detracted from performance this period included health care stock Brookdale Senior Living, Inc., information technology holdings Aruba Networks, Inc. and Acme Packet, Inc., and consumer discretionary stock Green Mountain Coffee, Inc. Green Mountain Coffee was the most significant underperformer this reporting period. The company underperformed because investor sentiment was negatively impacted by disappointing revenues and a bearish presentation made by a high profile hedge fund manager. Aruba Networks and Acme Packet underperformed in a generally weak environment for networking firms. Acme Packet, a networks solutions company that enables the delivery of interactive communications across internet protocol (IP) network borders, was also adversely affected by the timing of orders from large telecommunication services customers. Brookdale Senior Living, Inc., an operator of senior living communities in the U.S., declined over the second half of the period as higher operating expenses weighed on its stock price. We exited our positions in Brookdale Senior Living, Acme Packet and Green Mountain Coffee by period end.

Outlook

The macroeconomic environment is characterized by modest economic expansion, solid but decelerating profit growth and increased merger and acquisition activity. We believe that this is an environment that favors growth companies and are optimistic regarding the Fund’s investment strategy. We use a disciplined investment process designed to help take advantage of inefficiencies inherent in the small- and mid-cap markets. We rely on bottom-up, or company-level, research to help identify dynamic firms whose potential for above-average, sustainable revenue and earnings growth may position them to outperform. We believe our focus on higher quality growth companies has the potential to provide both upside participation and a degree of downside protection over the long term.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

4 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. Performance is measured over a ten-fiscal-year period for both Classes. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares. Past performance cannot guarantee future results.

     The Fund’s performance is compared to the performance of the Russell 2500^® Growth Index, the Russell 2000^® Growth Index and the Russell MidCap^® Growth Index. The Russell 2500^® Growth Index is an unmanaged index of U.S. small-cap and mid-cap growth stocks. The Russell 2000^® Growth Index measures the performance of the small-cap growth segment of the U.S. equity universe. It includes those Russell 2000 companies with higher price-to-book ratios and higher forecasted growth values. The Russell MidCap^® Growth Index is an unmanaged index of medium-capitalization domestic growth stocks. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

5 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

6 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

7 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	881.60	$	3.78
Service shares		1,000.00		880.50		4.96
Hypothetical
(5% return before expenses)
Non-Service shares		1,000.00		1,021.06		4.06
Service shares		1,000.00		1,019.80		5.33

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.80	%
Service shares		1.05

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

8 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—98.0%
Consumer Discretionary—19.5%
Distributors—0.5%
LKQ Corp.1		99,510	$	2,993,261
Hotels, Restaurants & Leisure—3.6%
Chipotle Mexican Grill, Inc., Cl. A1		28,631		9,669,834
Panera Bread Co., Cl. A1		59,520		8,419,104
Tim Hortons, Inc.		58,380		2,826,760
				20,915,698
Household Durables—0.9%
Tempur-Pedic International, Inc.1		96,710		5,080,176
Internet & Catalog Retail—0.3%
HomeAway, Inc.1		79,380		1,845,585
Multiline Retail—3.7%
Dollar Tree, Inc.1		181,315		15,069,090
Nordstrom, Inc.		125,220		6,224,686
				21,293,776
Specialty Retail—6.5%
O’Reilly Automotive, Inc.1		35,700		2,854,215
PetSmart, Inc.		97,900		5,021,291
Sally Beauty Holdings, Inc.1		160,740		3,396,436
Tiffany & Co.		99,910		6,620,037
Tractor Supply Co.		146,470		10,274,863
Ulta Salon, Cosmetics & Fragrance, Inc.1		148,120		9,615,950
				37,782,792
Textiles, Apparel & Luxury Goods—4.0%
Deckers Outdoor Corp.1		82,970		6,270,043
Fossil, Inc.1		57,560		4,567,962
lululemon athletica, Inc.1		103,810		4,843,775
Michael Kors Holdings Ltd.1		127,020		3,461,295
Under Armour, Inc., Cl. A1		54,600		3,919,734
				23,062,809
Consumer Staples—7.1%
Beverages—2.2%
Hansen Natural Corp.1		138,920		12,800,089
Food & Staples Retailing—2.1%
Fresh Market, Inc. (The)1		93,470		3,729,453
Whole Foods Market, Inc.		123,860		8,618,179
				12,347,632
Personal Products—2.8%
Estee Lauder Cos., Inc. (The), Cl. A		89,650		10,069,488
Herbalife Ltd.		113,510		5,865,062
				15,934,550
Energy—8.8%
Energy Equipment & Services—6.0%
Atwood Oceanics, Inc.1		164,200		6,533,518
Carbo Ceramics, Inc.		44,690		5,511,618
Core Laboratories NV		66,090		7,530,956
Oceaneering International, Inc.		63,770		2,941,710
Oil States International, Inc.1		102,650		7,839,381
Superior Energy Services, Inc.1		149,780		4,259,743
				34,616,926
Oil, Gas & Consumable Fuels—2.8%
Cabot Oil & Gas Corp., Cl. A		63,180		4,795,362
Concho Resources, Inc.1		121,300		11,371,875
				16,167,237
Financials—5.8%
Capital Markets—1.5%
Affiliated Managers Group, Inc.1		52,650		5,051,768
LPL Investment Holdings, Inc.1		110,290		3,368,257
				8,420,025
Commercial Banks—2.2%
First Republic Bank1		158,250		4,844,033
Signature Bank1		128,940		7,735,111
				12,579,144
Insurance—2.1%
Arthur J. Gallagher & Co.		160,940		5,381,834
ProAssurance Corp.		85,920		6,858,134
				12,239,968
Health Care—13.5%
Biotechnology—3.1%
Alexion Pharmaceuticals, Inc.1		202,940		14,510,210
BioMarin Pharmaceutical, Inc.1		92,570		3,182,557
				17,692,767
Health Care Equipment & Supplies—1.8%
Cooper Cos., Inc. (The)		57,790		4,075,351
Edwards Lifesciences Corp.1		46,160		3,263,512
IDEXX Laboratories, Inc.1		41,660		3,206,154
				10,545,017

9 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares		Value
Health Care Providers & Services—4.0%
AmerisourceBergen Corp.		205,340	$	7,636,595
Catalyst Health Solutions, Inc.1		92,800		4,825,600
HMS Holdings Corp.1		338,930		10,838,981
				23,301,176
Health Care Technology—2.4%
Cerner Corp.1		127,760		7,825,300
SXC Health Solutions Corp.1		107,270		6,058,610
				13,883,910
Pharmaceuticals—2.2%
Perrigo Co.		56,770		5,523,721
Watson Pharmaceuticals, Inc.1		118,580		7,155,117
				12,678,838
Industrials—18.2%
Aerospace & Defense—3.8%
B/E Aerospace, Inc.1		181,170		7,013,091
Hexcel Corp.1		236,710		5,730,749
TransDigm Group, Inc.1		97,200		9,300,096
				22,043,936
Commercial Services & Supplies—2.4%
Clean Harbors, Inc.1		54,310		3,461,176
Stericycle, Inc.1		61,730		4,810,002
Waste Connections, Inc.		163,980		5,434,297
				13,705,475
Electrical Equipment—3.7%
AMETEK, Inc.		185,905		7,826,601
Polypore International, Inc.1		125,110		5,503,589
Roper Industries, Inc.		96,860		8,414,228
				21,744,418
Machinery—5.4%
Gardner Denver, Inc.		130,181		10,031,748
Joy Global, Inc.		77,510		5,810,925
Pall Corp.		50,530		2,887,790
Robbins & Myers, Inc.		107,062		5,197,860
Wabtec Corp.		106,080		7,420,296
				31,348,619
Marine—0.8%
Kirby Corp.1		66,820		4,399,429
Road & Rail—2.1%
Kansas City Southern, Inc.1		177,770		12,090,138
Information Technology—19.0%
Communications Equipment—1.6%
Aruba Networks, Inc.1		207,400		3,841,048
F5 Networks, Inc.1		27,220		2,888,586
Riverbed Technology, Inc.1		116,600		2,740,100
				9,469,734
Computers & Peripherals—1.0%
SanDisk Corp.1		118,800		5,846,148
Internet Software & Services—3.7%
Equinix, Inc.1		57,900		5,871,060
IAC/InterActiveCorp		73,750		3,141,750
Mercadolibre, Inc.		35,970		2,861,054
Rackspace Hosting, Inc.1		223,380		9,607,574
				21,481,438
IT Services—1.8%
Alliance Data Systems Corp.1		33,690		3,498,370
Teradata Corp.1		140,160		6,799,162
				10,297,532
Semiconductors & Semiconductor Equipment—2.8%
Avago Technologies Ltd.		210,940		6,087,728
Cavuim, Inc.1		195,800		5,566,594
Cypress Semiconductor Corp.		249,080		4,206,961
				15,861,283
Software—8.1%
Ariba, Inc.1		196,950		5,530,356
Check Point Software Technologies Ltd.1		112,540		5,912,852
Citrix Systems, Inc.1		86,480		5,251,066
Fortinet, Inc.1		298,510		6,510,503
MICROS Systems, Inc.1		74,030		3,448,317
Nuance Communications, Inc.1		243,720		6,131,995
Red Hat, Inc.1		157,870		6,518,452
TIBCO Software, Inc.1		318,930		7,625,616
				46,929,157
Materials—4.4%
Chemicals—3.0%
Airgas, Inc.		78,650		6,140,992
Albemarle Corp.		60,020		3,091,630
CF Industries Holdings, Inc.		35,240		5,109,095
Sigma-Aldrich Corp.		45,410		2,836,309
				17,178,026

10 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

	Shares			Value
Containers & Packaging—0.5%
Ball Corp.		85,850		$	3,065,704
Metals & Mining—0.9%
Allied Nevada Gold Corp.1		115,380			3,493,706
Silver Wheaton Corp.		64,680			1,873,133
					5,366,839
Telecommunication Services—0.9%
Wireless Telecommunication Services—0.9%
SBA Communications Corp.1		124,300			5,339,928
Utilities—0.8%
Electric Utilities—0.8%
ITC Holdings Corp.		61,890			4,696,213
Total Common Stocks (Cost $443,441,234)					567,045,393
Investment Company—2.4%
Oppenheimer Institutional
Money Market Fund,
Cl. E, 0.20%2,3 (Cost $14,138,260)		14,138,260			14,138,260
Total Investments, at Value (Cost $457,579,494)		100.4	%		581,183,653
Liabilities in Excess of Other Assets		(0.4	)		(2,391,076	)
Net Assets		100.0	%	$	578,792,577

Footnotes to Statement of Investments

* December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

1. Non-income producing security.

2. Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		2,477,343		298,507,957		286,847,040		14,138,260

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	14,138,260	$	29,298

3. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

11 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3—
	Level 1—		Level 2—		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	112,974,097	$	—	$	—	$	112,974,097
Consumer Staples		41,082,271		—		—		41,082,271
Energy		50,784,163		—		—		50,784,163
Financials		33,239,137		—		—		33,239,137
Health Care		78,101,708		—		—		78,101,708
Industrials		105,332,015		—		—		105,332,015
Information Technology		109,885,292		—		—		109,885,292
Materials		25,610,569		—		—		25,610,569
Telecommunication Services		5,339,928		—		—		5,339,928
Utilities		4,696,213		—		—		4,696,213
Investment Company		14,138,260		—		—		14,138,260
Total Assets	$	581,183,653	$	—	$	—	$	581,183,653

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

12 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $443,441,234)	$	567,045,393
Affiliated companies (cost $14,138,260)		14,138,260
		581,183,653
Cash		10,642
Receivables and other assets:
Investments sold		4,950,623
Dividends		146,929
Other		25,495
Total assets		586,317,342
Liabilities
Payables and other liabilities:
Investments purchased		7,107,703
Shares of beneficial interest redeemed		218,488
Shareholder communications		94,613
Transfer and shareholder servicing agent fees		50,230
Trustees’ compensation		23,054
Distribution and service plan fees		7,115
Other		23,562
Total liabilities		7,524,765
Net Assets	$	578,792,577
Composition of Net Assets
Par value of shares of beneficial interest	$	12,320
Additional paid-in capital		680,555,657
Accumulated net investment loss		(23,054	)
Accumulated net realized loss on investments		(225,356,505	)
Net unrealized appreciation on investments		123,604,159
Net Assets	$	578,792,577
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $543,019,910 and 11,539,403 shares of beneficial interest outstanding)	$	47.06
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $35,772,667 and 780,440 shares of beneficial interest outstanding)	$	45.84

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

13 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $12,856)	$	1,694,660
Affiliated companies		29,298
Interest		400
Total investment income		1,724,358
Expenses
Management fees		4,602,216
Distribution and service plan fees—Service shares		94,416
Transfer and shareholder servicing agent fees:
Non-Service shares		605,262
Service shares		37,794
Shareholder communications:
Non-Service shares		66,395
Service shares		4,003
Trustees’ compensation		27,965
Custodian fees and expenses		4,518
Administration service fees		1,500
Other		49,607
Total expenses		5,493,676
Less waivers and reimbursements of expenses		(265,165	)
Net expenses		5,228,511
Net Investment Loss		(3,504,153	)
Realized and Unrealized Gain (Loss)
Net realized gain on investments from unaffiliated companies		77,531,562
Net change in unrealized appreciation/depreciation on investments		(62,965,525	)
Net Increase in Net Assets Resulting from Operations	$	11,061,884

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

14 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment loss	$	(3,504,153	)	$	(1,731,317	)
Net realized gain		77,531,562			74,149,150
Net change in unrealized appreciation/depreciation		(62,965,525	)		71,236,219
Net increase in net assets resulting from operations		11,061,884			143,654,052
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		(80,390,137	)		(72,544,702	)
Service shares		3,579,422			(348,697	)
		(76,810,715	)		(72,893,399	)
Net Assets
Total increase (decrease)		(65,748,831	)		70,760,653
Beginning of period		644,541,408			573,780,755
End of period (including accumulated net investment loss of $23,054 and $20,834, respectively)	$	578,792,577		$	644,541,408

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

15 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	46.55		$	36.52		$	27.54		$	54.07		$	50.85
Income (loss) from investment operations:
Net investment loss2		(.26	)		(.11	)		(.05	)		(.13	)		(.02	)
Net realized and unrealized gain (loss)		.77			10.14			9.03			(26.40	)		3.24
Total from investment operations		.51			10.03			8.98			(26.53	)		3.22
Net asset value, end of period	$	47.06		$	46.55		$	36.52		$	27.54		$	54.07
Total Return, at Net Asset Value3		1.09	%		27.46	%		32.61	%		(49.07	)%		6.33	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	543,020		$	611,872		$	547,683		$	461,684		$	1,002,442
Average net assets (in thousands)	$	605,083		$	548,739		$	478,968		$	754,170		$	1,045,592
Ratios to average net assets:4
Net investment loss		(0.53	)%		(0.29	)%		(0.17	)%		(0.30	)%		(0.04	)%
Total expenses5		0.84	%		0.85	%		0.86	%		0.71	%		0.69	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.80	%		0.76	%		0.71	%		0.68	%		0.69	%
Portfolio turnover rate		91	%		95	%		102	%		78	%		112	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.84	%
Year Ended December 31, 2010	0.85	%
Year Ended December 31, 2009	0.86	%
Year Ended December 31, 2008	0.71	%
Year Ended December 31, 2007	0.69	%

See accompanying Notes to Financial Statements.

16 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	45.46		$	35.75		$	27.03		$	53.22		$	50.19
Income (loss) from investment operations:
Net investment loss2		(.37	)		(.20	)		(.13	)		(.24	)		(.17	)
Net realized and unrealized gain (loss)		.75			9.91			8.85			(25.95	)		3.20
Total from investment operations		.38			9.71			8.72			(26.19	)		3.03
Net asset value, end of period	$	45.84		$	45.46		$	35.75		$	27.03		$	53.22
Total Return, at Net Asset Value3		0.83	%		27.16	%		32.26	%		(49.21	)%		6.04	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	35,773		$	32,669		$	26,098		$	21,952		$	47,270
Average net assets (in thousands)	$	37,775		$	27,552		$	22,605		$	35,815		$	49,421
Ratios to average net assets:4
Net investment loss		(0.78	)%		(0.53	)%		(0.44	)%		(0.57	)%		(0.31	)%
Total expenses5		1.09	%		1.10	%		1.12	%		0.98	%		0.96	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.05	%		1.01	%		0.97	%		0.95	%		0.96	%
Portfolio turnover rate		91	%		95	%		102	%		78	%		112	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.09	%
Year Ended December 31, 2010	1.10	%
Year Ended December 31, 2009	1.12	%
Year Ended December 31, 2008	0.98	%
Year Ended December 31, 2007	0.96	%

See accompanying Notes to Financial Statements.

17 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Small- & Mid-Cap Growth Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek capital appreciation by investing in “growth type” companies. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

18 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

						Net Unrealized
						Appreciation
						Based on Cost of
Undistributed		Undistributed		Accumulated		Securities and Other
Net Investment		Long-Term		Loss		Investments for Federal
Income		Gain		Carryforward1,2,3,4		Income Tax Purposes
$	—	$	—	$	224,611,819	$	122,859,464

19 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

1. As of December 30, 2011, the Fund had $217,070,467 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2017	$	217,070,467

2. As of December 30, 2011, the Fund had $7,541,352 of post-October losses available to offset future realized capital gains, if any.

3. During the fiscal year ended December 30, 2011, the Fund utilized $83,964,525 of capital loss carryforward to offset capital gains realized in that fiscal year.

4. During the fiscal year ended December 31, 2010, the Fund utilized $72,390,451 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Reduction to
	Accumulated
Reduction to	Net Investment
Paid-in Capital	Loss
$3,501,933	$	3,501,933

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	458,324,189
Gross unrealized appreciation	$	135,530,691
Gross unrealized depreciation		(12,671,227	)
Net unrealized appreciation	$	122,859,464

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

20 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		665,252		$	32,309,437			660,517		$	26,701,795
Redeemed		(2,270,275	)		(112,699,574	)		(2,513,826	)		(99,246,497	)
Net decrease		(1,605,023	)	$	(80,390,137	)		(1,853,309	)	$	(72,544,702	)
Service Shares
Sold		366,560		$	18,018,685			170,363		$	6,822,078
Redeemed		(304,822	)		(14,439,263	)		(181,692	)		(7,170,775	)
Net increase (decrease)		61,738		$	3,579,422			(11,329	)	$	(348,697	)

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	577,573,605	$	673,534,159

21 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Next $700 million	0.60
Over $1.5 billion	0.58

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $648,358 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $232,824 and $14,506 for Non-Service and Service shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $17,835 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving

22 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

23 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Pending Litigation Continued

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

24 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Small- & Mid-Cap Growth Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Small- & Mid-Cap Growth Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Small- & Mid-Cap Growth Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

25 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

     26 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio manager and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Ronald Zibelli, Jr., the portfolio manager for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical

27 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued

performance to relevant market indices and to the performance of other mid-cap growth funds underlying variable insurance products. The Board considered that the Fund underperformed its performance universe median during the one-, three-, five-, and ten-year Lipper periods. The Board also considered, however, the Manager’s assertion that the portfolio manager’s high quality emphasis, which generally was out of favor in 2009, accounted for the Fund’s underperformance. The Board considered that the Manager changed the Fund’s name and investment policies on May 1, 2010 to reflect that the Fund could invest in small-cap stocks as well as mid-cap stocks. The Board also considered the Manager’s assertion that, going forward, these changes should improve the Fund’s performance. The Board also considered the Fund’s recent improved performance, ranking in the top quintile of its expense universe for the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other mid-cap growth funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were lower than the expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service Shares and 1.05% for Service Shares. This voluntary expense limitation my not be amended or withdrawn until one year after the date of prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

28 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

29 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout

30 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989- June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank- Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2001) Age: 69	Trustee Emeritus of Worcester Poly tech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005- March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003- March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004- August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006- May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC;

31 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
William F. Glavin, Jr., Continued	and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Zibelli, Jr., Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Ronald J. Zibelli, Jr., Vice President (since 2008) Age: 52	Vice President of the Manager (since May 2006); a Chartered Financial Analyst. Prior to joining the Manager, Managing Director and Small Cap Growth Team Leader at Merrill Lynch Investment Managers (January 2002- May 2006). A portfolio manager and officer of 3 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005- April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

32 | OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

OPPENHEIMER SMALL- & MID-CAP GROWTH FUND/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011

Oppenheimer Balanced Fund/VA            AnnualReport

A Series of Oppenheimer Variable Account Funds

ANNUAL REPORT

Listing of Top Holdings Fund Performance

Discussion Financial Statements

OPPENHEIMER BALANCED FUND/VA

Portfolio Managers: Mitch Williams,¹ CFA; Krishna Memani and Peter A. Strzalkowski, CFA

Average Annual Total Returns
For the Periods Ended 12/30/11²

	1-Year	5-Year	10-Year
Non-Service Shares	0.72%	-4.05%	1.47%

			Since
			Inception
	1-Year	5-Year	(5/1/02)
Service Shares	0.38%	-4.30%	1.40%

Expense Ratios
For the Periods Ended 12/30/11²

	Gross	Net
	Expense	Expense
	Ratios3	Ratios3
Non-Service Shares	0.93%	0.69%
Service Shares	1.18	0.94

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Portfolio Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of investments.

Top Ten Common Stock Holdings
Chevron Corp.	3.5	%
U.S. Bancorp	2.1
Coca-Cola Co. (The)	2.0
Wells Fargo & Co.	1.9
MetLife, Inc.	1.6
Jupiter Telecommunications Co. Ltd.	1.6
Goldman Sachs Group, Inc. (The)	1.6
Exxon Mobil Corp.	1.5
Pfizer, Inc.	1.5
ACE Ltd.	1.4

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

1.	Effective November 2011.
2.	December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements.
3.	These Expense Ratios include the applicable indirect expenses attributable to the Fund’s investments in other investment companies.

2 | OPPENHEIMER BALANCED FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of 0.72% for the reporting period ended December 30, 2011.⁴ In comparison, the S&P 500 Index returned 2.11% and the Barclays Capital U.S. Aggregate Bond Index returned 7.84%. Fixed-income investments generally performed much better relative to equities during this volatile reporting period. As such, the Fund’s equity component experienced declines and the fixed-income component produced positive results, resulting in a muted return for the Fund overall.

Economic and Market Overview

The first half of the reporting period was generally characterized by resilience among investors who looked forward to improved credit conditions in a recovering global economy. Even the wave of political unrest in the Middle East in early 2011, which led to sharply higher energy prices, had only a temporary dampening effect on most financial markets. Likewise, markets recovered relatively quickly after a devastating natural disaster and subsequent nuclear energy crisis hit Japan in March, disrupting global industrial supply chains. During this time, equities and higher-yielding fixed income securities generally performed well.

     Investor sentiment began to deteriorate in late April, when U.S. economic data proved disappointing, and a contentious U.S. fiscal policy debate intensified. These concerns reached a tipping point in early August, when the credit rating company Standard & Poor’s downgraded the sovereign debt of the U.S., a decision that the two other major credit rating firms opted not to follow.

     Meanwhile, international uncertainty worsened with the high likelihood that Greece was headed for default on its debt and other members of the European Union continued to struggle with heavy debt burdens, leading to worries over the health of the European banking system. Inflationary pressures mounted in China and other emerging markets, where investors grew concerned that remedial measures, including higher local interest rates, might derail these major engines of global growth. Financial markets also grew concerned that new recessions in the developed markets could mean a slowdown in growth in export dependent emerging economies. Some emerging market countries saw their GDP growth stall after a prolonged period of solid increases.

     These events triggered a flight to quality that boosted traditional safe havens but hurt areas of the market that historically have been considered riskier. Fixed-income investments in emerging markets generally underperformed their developed markets counterparts as a result of shifting investor sentiment. In the United States, long-term U.S. Treasury securities continued to rally even after the credit-rating downgrade, but high yield corporate bonds gave back earlier gains, despite generally healthy balance sheets and limited needs for near term refinancing. Market turbulence throughout the world was particularly severe over the third quarter of 2011 with most global risk markets experiencing sharp declines.

     In the fourth quarter, risk markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Equity Component

During the period, the Fund’s equity component experienced declines and underperformed the S&P 500 Index. The equity component underperformed primarily due to a steep sell-off in global equity markets over the third quarter of 2011. The Fund’s holdings, particularly in the financials, information technology and industrials sectors, suffered during this time. The equity component received better results from its investments in the energy and consumer staples sectors.

4. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER BALANCED FUND/VA

FUND PERFORMANCE DISCUSSION

     In terms of individual Fund holdings, the most significant detractor from performance this period was video game company THQ, Inc. Shares of THQ declined over the first half of the period after reviews for its Homefront game came in weaker than expected. The company experienced further weakness over the second half of the year during which it lowered its revenue outlook for its fiscal third quarter. We exited our position in the stock by period end. Financial holdings JPMorgan Chase & Co. and MetLife, Inc. also hurt the Fund’s performance this period. Financial stocks generally declined this year as a weak global economy and banks’ exposure to the crisis in the Eurozone worried investors.

     The equity component’s strongest contributor to performance was Take-Two Interactive Software, Inc. During the period, Take-Two generally executed its business plan well and continued to develop new intellectual property. It also benefited from Red Dead Redemption, a video game released by Rockstar Studios. We exited our position in Take-Two by period end and locked in our gains. Other holdings that benefited performance this period were energy stock Chevron Corp. and health care holding Humana, Inc. Chevron benefited from the rising price of oil over the first quarter, but its stock price also appreciated as the market rewarded its impressive drilling prowess and the highest resource replacement rate among its peers. Humana is a leading Medicare provider in the U.S. and in 2011 expanded its base of operations as well as Medicare Advantage policyholders through a series of acquisitions, including deals to acquire Antiva Health, MD Care, Arcadian Management Services, SeniorBridge and several urgent medical centers from NextCare, Inc. through its subsidiary Concentra, Inc.

Fixed-Income Component

During the reporting period, the Fund’s fixed-income component performed roughly in line with the Barclays Capital U.S. Aggregate Bond Index. The fixed-income component’s positive absolute performance was driven by its investments in mortgage backed obligations, particularly residential mortgage-backed securities (RMBS). The fixed-income component’s exposure to RMBS included securities guaranteed by government-sponsored enterprises, commonly referred to as agency RMBS, as well as a smaller allocation to RMBS originated by private entities, also known as non-agency RMBS. Commercial mortgage-backed securities (CMBS) and asset backed securities (ABS) also performed well for the fixed-income component. Despite bouts of risk aversion, particularly over the volatile third quarter of 2011, mortgage backed obligations generally produced positive results for the year. The fixed-income component also benefited from an allocation to investment grade and high yield securities for the year.

     In terms of detractors from performance, the fixed-income component’s limited exposure to U.S. Treasuries hurt performance. Despite Standard & Poor’s downgrade of U.S. sovereign debt, U.S. Treasuries held up well during the year as many investors remained cautious of risk. Our underweight position in agency debt also detracted from relative performance this period.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

4 | OPPENHEIMER BALANCED FUND/VA

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. In the case of Non-Service shares, performance is measured over a ten-fiscal-year period. In the case of Service shares, performance is measured from inception of the Class on May 1, 2002. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of both the S&P 500 Index, an unmanaged index of large-capitalization equity securities that is a measure of the general domestic stock market, and the Barclays Capital U.S. Aggregate Bond Index, an unmanaged index of U.S. corporate, government and mortgage-backed securities that is a measure of the domestic bond market. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments vary from the securities comprising the indices.

5 | OPPENHEIMER BALANCED FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER BALANCED FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service Shares	$	1,000.00	$	965.80	$	3.31
Service Shares		1,000.00		963.80		4.54
Hypothetical
(5% return before expenses)
Non-Service Shares		1,000.00		1,021.71		3.40
Service Shares		1,000.00		1,020.46		4.67

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service Shares		0.67	%
Service Shares		0.92

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—48.1%
Consumer Discretionary—6.5%
Automobiles—0.9%
Ford Motor Co.1		175,370	$	1,886,981
Household Durables—0.5%
Mohawk Industries, Inc.1		17,780		1,064,133
Media—3.8%
Comcast Corp., Cl. A		118,380		2,806,790
Jupiter Telecommunications Co. Ltd.		3,231		3,274,237
Viacom, Inc., Cl. B		35,080		1,592,983
				7,674,010
Multiline Retail—1.3%
Target Corp.		53,080		2,718,758
Consumer Staples—4.0%
Beverages—2.0%
Coca-Cola Co. (The)		58,860		4,118,434
Food & Staples Retailing—1.3%
Wal-Mart Stores, Inc.		45,590		2,724,458
Household Products—0.7%
Church & Dwight Co., Inc.		29,050		1,329,328
Energy—7.3%
Energy Equipment & Services—0.4%
Nabors Industries Ltd.1		51,520		893,357
Oil, Gas & Consumable Fuels—6.9%
Apache Corp.		12,290		1,113,228
Chevron Corp.		68,690		7,308,612
Exxon Mobil Corp.		37,000		3,136,120
Penn West Petroleum Ltd.		30,730		608,454
Royal Dutch Shell plc, ADR		26,970		1,971,237
				14,137,651
Financials—11.1%
Capital Markets—1.6%
Goldman Sachs Group, Inc. (The)		35,530		3,212,978
Commercial Banks—5.2%
CIT Group, Inc.1		25,970		905,574
M&T Bank Corp.		20,750		1,584,055
U.S. Bancorp		158,000		4,273,900
Wells Fargo & Co.		143,530		3,955,687
				10,719,216
Diversified Financial Services—1.3%
JPMorgan Chase & Co.		81,040		2,694,580
Insurance—3.0%
ACE Ltd.		40,870		2,865,804
MetLife, Inc.		107,300		3,345,614
				6,211,418
Health Care—5.8%
Biotechnology—1.0%
Gilead Sciences, Inc.1		49,760		2,036,677
Health Care Equipment & Supplies—1.1%
Medtronic, Inc.		57,750		2,208,938
Health Care Providers & Services—2.2%
Humana, Inc.		18,400		1,612,024
UnitedHealth Group, Inc.		40,010		2,027,707
WellPoint, Inc.		13,700		907,625
				4,547,356
Pharmaceuticals—1.5%
Pfizer, Inc.		143,630		3,108,153
Industrials—3.0%
Electrical Equipment—1.3%
Cooper Industries plc		50,210		2,718,872
Industrial Conglomerates—1.3%
Tyco International Ltd.		54,600		2,550,366
Trading Companies & Distributors—0.4%
AerCap Holdings NV1		73,620		831,170
Information Technology—4.7%
Communications Equipment—1.0%
Juniper Networks, Inc.1		102,000		2,081,820
Orbcomm, Inc.1		375		1,121
				2,082,941
Computers & Peripherals—0.3%
Hewlett-Packard Co.		20,090		517,518
Internet Software & Services—0.3%
VeriSign, Inc.		17,710		632,601
Semiconductors & Semiconductor Equipment—0.7%
Xilinx, Inc.		45,620		1,462,577
Software—2.4%
Microsoft Corp.		107,420		2,788,623
Oracle Corp.		86,240		2,212,056
				5,000,679
Materials—1.5%
Chemicals—1.1%
Celanese Corp., Series A		13,790		610,483
Mosaic Co. (The)		35,010		1,765,554
				2,376,037
Containers & Packaging—0.4%
Rock-Tenn Co., Cl. A		14,350		827,995
Telecommunication Services—1.7%
Diversified Telecommunication Services—0.7%
AT&T, Inc.		51,330		1,552,219

8 | OPPENHEIMER BALANCED FUND/VA

	Shares		Value
Wireless Telecommunication Services—1.0%
Vodafone Group plc, Sponsored ADR		72,840	$	2,041,705
Utilities—2.5%
Electric Utilities—1.6%
American Electric Power Co., Inc.		16,520		682,441
Edison International, Inc.		65,690		2,719,566
				3,402,007
Energy Traders—0.3%
GenOn Energy, Inc.1		208,040		542,984
Multi-Utilities—0.6%
Public Service Enterprise Group, Inc.		38,850		1,282,439
Total Common Stocks (Cost $95,567,248)				99,108,536

	Principal
	Amount
Asset-Backed Securities—4.3%
AESOP Funding II LLC, Automobile Receivables Nts., Series 2011-1A, Cl. A, 1.85%, 11/20/132	$	125,000	124,718
Ally Auto Receivables Trust 2010-4, Automobile Receivables Nts., Series 2010-4, Cl. A3, 0.91%, 11/17/14		30,000	30,036
Ally Master Owner Trust 2010-3, Asset-Backed Certificates, Series 2010-3, Cl. A, 2.88%, 4/15/152		200,000	203,361
Ally Master Owner Trust, Automobile Receivables Nts., Series 2011-4, Cl. A2, 1.54%, 9/15/16		240,000	239,359
AmeriCredit Automobile Receivables Trust 2009-1, Automobile Receivables-Backed Nts., Series 2009-1, Cl. A3, 3.04%, 10/15/13		63,097	63,447
AmeriCredit Automobile Receivables Trust 2011-1, Automobile Receivables-Backed Nts., Series 2011-1, Cl. D, 4.26%, 2/8/17		60,000	60,771
AmeriCredit Automobile Receivables Trust 2011-2, Automobile Receivables-Backed Nts.:
Series 2011-2, Cl. A3, 1.61%, 10/8/15		70,000	70,304
Series 2011-2, Cl. D, 4%, 5/8/17		120,000	119,838
AmeriCredit Automobile Receivables Trust 2011-4, Automobile Receivables-Backed Nts., Series 2011-4, Cl. D, 4.08%, 7/10/17		335,000	334,498
AmeriCredit Automobile Receivables Trust 2011-5, Automobile Receivables Nts., Series 2011-5, Cl. D, 4.72%, 12/8/17		205,000	209,733
AmeriCredit Prime Automobile Receivables Trust 2010-2, Automobile Receivables Nts., Series 2010-2, Cl. A2, 1.22%, 10/8/13		18,188	18,197
CarMax Auto Owner Trust 2010-3, Automobile Asset-Backed Nts., Series 2010-3, Cl. A3, 0.99%, 2/17/15		65,000	65,140
Carrington Mortgage Loan Trust, Asset-Backed Pass-Through Certificates, Series 2006-FRE1, Cl. A2, 0.404%, 7/25/363		177,363	163,486
Centre Point Funding LLC, Asset-Backed Nts., Series 2010-1A, Cl. 1, 5.43%, 7/20/152		52,768	55,340
Citibank Credit Card Issuance Trust, Credit Card Receivable Nts., Series 2003-C4, Cl. C4, 5%, 6/10/15		180,000	187,736
Citibank Omni Master Trust, Credit Card Receivables:
Series 2009-A13, Cl. A13, 5.35%, 8/15/182		475,000	519,207
Series 2009-A17, Cl. A17, 4.90%, 11/15/182		370,000	402,724
Series 2009-A8, Cl. A8, 2.378%, 5/16/162,3		325,000	327,026
CNH Wholesale Master Note Trust 2011-1, Equipment Nts., Series 2011-1, Cl. 1A, 1.078%, 1/20/413		240,000	240,290
Countrywide Home Loans, Asset-Backed Certificates:
Series 2002-4, Cl. A1, 1.034%, 2/25/333		8,285	7,957
Series 2005-16, Cl. 2AF2, 5.377%, 5/1/363		222,632	171,039
CWABS Asset-Backed Certificates Trust 2006-25, Asset-Backed Certificates, Series 2006-25, Cl. 2A2, 0.414%, 6/25/473		428,317	378,736
DSC Floorplan Master Owner Trust, Automobile Receivable Nts., Series 2011-1, Cl. A, 3.91%, 3/15/16		210,000	212,845
DT Auto Owner Trust 2009-1, Automobile Receivable Nts., Series 2009-1, Cl. A1, 2.98%, 10/15/152		104,466	104,976
DT Auto Owner Trust 2011-1A, Automobile Receivable Nts., Series 2011-1A, Cl. C, 3.05%, 8/15/152		290,000	290,555
DT Auto Owner Trust 2011-2A, Automobile Receivable Nts., Series 2011-2A, Cl. C, 3.05%, 7/15/132		70,000	69,769
DT Auto Owner Trust 2011-3A, Automobile Receivable Nts., Series 2011-3A, Cl. C, 4.03%, 12/15/414		201,000	200,600
First Investors Auto Owner Trust 2011-1, Automobile Receivable Nts., Series 2011-1, Cl. A2, 1.47%, 3/16/15		155,498	154,780
Ford Credit Floorplan Master Owner Trust 2009-2, Asset-Backed Nts., Series 2009-2, Cl. A, 1.828%, 9/15/143		245,000	246,891
Ford Credit Floorplan Master Owner Trust 2010-1, Asset-Backed Nts., Series 2010-1, Cl. A, 1.928%, 12/15/142,3		250,000	252,743

9 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Asset-Backed Securities Continued
Ford Credit Floorplan Master Owner Trust 2011-1, Asset-Backed Nts., Series 2011-1, Cl. A1, 2.12%, 2/15/16	$	255,000	$	258,540
GE Dealer Floorplan Master Note Trust, Asset-Backed Securities, Series 2009-2A, Cl. A, 1.828%, 10/20/142,3		240,000		242,118
GMAC Mortgage Servicer Advance Funding Ltd., Asset-Backed Nts., Series 2011-1A, Cl. A, 3.72%, 2/15/232		230,000		229,983
Hertz Vehicle Financing LLC, Automobile Receivable Nts., Series 2010-1A, Cl. A1, 2.60%, 2/25/152		315,000		318,683
MBNA Credit Card Master Note Trust, Credit Card Receivables, Series 2003-C7, Cl. C7, 1.628%, 3/15/163		255,000		255,717
Nissan Auto Lease Trust 2010-B, Automobile Asset-Backed Nts., Series 2010-B, Cl. A3, 1.12%, 12/15/13		220,000		220,565
Nissan Master Owner Trust, Automobile Receivable Nts., Series 2010-AA, Cl. A, 1.428%, 1/15/152,3		240,000		241,833
Rental Car Finance Corp., Automobile Receivable Nts., Series 2011-1A, Cl. A1, 2.51%, 2/25/162		180,000		179,678
Santander Drive Auto Receivables Trust 2010-2, Automobile Receivables Nts., Series 2010-2, Cl. A2, 0.95%, 8/15/13		84,342		84,339
Santander Drive Auto Receivables Trust 2010-3, Automobile Receivables Nts., Series 2010-3, Cl. C, 3.06%, 11/15/17		235,000		235,014
Santander Drive Auto Receivables Trust 2010-A, Automobile Receivables Nts., Series 2010-A, Cl. A2, 1.37%, 8/15/132		113,838		113,937
Santander Drive Auto Receivables Trust 2011-1, Automobile Receivables Nts., Series 2011-1, Cl. D, 4.01%, 2/15/17		245,000		244,501
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/174		230,913		228,892
Santander Drive Auto Receivables Trust 2011-S2A, Automobile Receivables Nts., Series 2011-S2A, Cl. D, 3.35%, 6/15/172		177,527		174,865
Volkswagen Auto Lease Trust 2010-A, Automobile Receivable Nts., Series 2010-A, Cl. A3, 0.99%, 11/20/13		215,000		215,349
Westlake Automobile Receivables Trust 2011-1, Automobile Receivables Nts., Series 2011-1, Cl. A3, 1.49%, 6/16/142		105,000		104,898
Total Asset-Backed Securities (Cost $8,956,068)				8,875,014
Mortgage-Backed Obligations—28.2%
Government Agency—23.0%
FHLMC/FNMA/FHLB/Sponsored—22.6%
Federal Home Loan Mortgage Corp.:
4.50%, 1/1/425		1,595,000		1,690,451
5.50%, 9/1/39		1,038,003		1,128,541
7%, 10/1/37		756,180		862,947
Federal Home Loan Mortgage Corp., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Series 2006-11, Cl. PS, 23.49%, 3/25/363		208,974		291,823
Series 2426, Cl. BG, 6%, 3/15/17		292,502		313,107
Series 2427, Cl. ZM, 6.50%, 3/15/32		355,826		409,262
Series 2626, Cl. TB, 5%, 6/1/33		495,738		547,873
Series 2663, Cl. BA, 4%, 8/1/16		79,583		79,761
Series 2686, Cl. CD, 4.50%, 2/1/17		3,816		3,815
Series 3019, Cl. MD, 4.75%, 1/1/31		88,424		88,878
Series 3025, Cl. SJ, 23.73%, 8/15/353		60,634		86,707
Series 3094, Cl. HS, 23.363%, 6/15/343		120,743		163,480
Series 3242, Cl. QA, 5.50%, 3/1/30		41,838		42,019
Series 3822, Cl. JA, 5%, 6/1/40		398,780		431,858
Series 3848, Cl. WL, 4%, 4/1/40		288,558		305,005
Series R001, Cl. AE, 4.375%, 4/1/15		3,759		3,758
Federal Home Loan Mortgage Corp., Interest-Only Stripped Mtg.-Backed Security:
Series 183, Cl. IO, 15.233%, 4/1/276		143,551		23,425
Series 192, Cl. IO, 13.427%, 2/1/286		41,272		7,891
Series 2130, Cl. SC, 50.18%, 3/15/296		116,974		23,846
Series 243, Cl. 6, 0.377%, 12/15/326		138,077		25,081
Series 2527, Cl. SG, 10.403%, 2/15/326		12,469		133
Series 2531, Cl. ST, 58.412%, 2/15/306		368,946		11,344
Series 2796, Cl. SD, 61.829%, 7/15/266		169,644		33,314
Series 2802, Cl. AS, 60.97%, 4/15/336		118,293		8,478
Series 2920, Cl. S, 63.683%, 1/15/356		932,789		158,091
Series 3110, Cl. SL, 99.999%, 2/15/266		123,887		15,878
Series 3451, Cl. SB, 20.751%, 5/15/386		725,978		86,535
Federal Home Loan Mortgage Corp., Principal-Only Stripped Mtg.-Backed Security, Series 176, Cl. PO, 3.812%, 6/1/267		41,694		38,195
Federal National Mortgage Assn.:
3.50%, 1/1/275		2,500,000		2,614,844
4%, 1/1/425		4,285,000		4,502,598
4.50%, 1/1/27-1/1/425		7,687,000		8,185,248
5%, 1/1/425		5,657,000		6,112,213
5.50%, 9/25/20		9,370		10,265

10 | OPPENHEIMER BALANCED FUND/VA

	Principal
	Amount		Value
FHLMC/FNMA/FHLB/Sponsored Continued
Federal National Mortgage Assn.: Continued
5.50%, 1/1/27-1/1/425	$	2,644,000	$	2,878,069
6%, 3/1/37		644,704		711,313
6%, 1/1/425		2,025,000		2,230,032
6.50%, 1/1/425		680,000		756,713
7%, 11/1/17		119,583		127,915
7.50%, 1/1/33		176,098		209,822
8.50%, 7/1/32		5,673		6,937
Federal National Mortgage Assn., 15 yr.:
3%, 1/1/275		4,630,000		4,782,645
4%, 1/1/275		235,000		247,888
Federal National Mortgage Assn., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Trust 1998-61, Cl. PL, 6%, 11/25/28		121,285		136,532
Trust 2004-101, Cl. BG, 5%, 1/25/20		721,364		772,696
Trust 2004-9, Cl. AB, 4%, 7/1/17		87,826		88,598
Trust 2005-104, Cl. MC, 5.50%, 12/25/25		700,000		776,851
Trust 2005-12, Cl. JC, 5%, 6/1/28		61,136		61,308
Trust 2005-22, Cl. EC, 5%, 10/1/28		26,639		26,690
Trust 2005-30, Cl. CU, 5%, 4/1/29		42,270		42,506
Trust 2005-69, Cl. LE, 5.50%, 11/1/33		266,714		278,672
Trust 2006-46, Cl. SW, 23.123%, 6/25/363		151,290		211,240
Trust 2007-42, Cl. A, 6%, 2/1/33		349,324		366,115
Trust 2009-36, Cl. FA, 1.234%, 6/25/373		358,304		362,778
Trust 2009-37, Cl. HA, 4%, 4/1/19		433,702		457,191
Trust 2009-70, Cl. PA, 5%, 8/1/35		530,387		545,953
Trust 2011-15, Cl. DA, 4%, 3/1/41		190,903		202,069
Trust 2011-3, Cl. KA, 5%, 4/1/40		278,638		301,981
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Trust 2001-65, Cl. S, 36.887%, 11/25/316		328,819		59,590
Trust 2001-81, Cl. S, 31.648%, 1/25/326		77,633		15,352
Trust 2002-47, Cl. NS, 34.45%, 4/25/326		185,860		35,476
Trust 2002-51, Cl. S, 34.703%, 8/25/326		170,663		32,581
Trust 2002-52, Cl. SD, 41.209%, 9/25/326		214,578		42,915
Trust 2002-77, Cl. SH, 41.713%, 12/18/326		113,096		22,106
Trust 2002-84, Cl. SA, 40.239%, 12/25/326		304,774		52,674
Trust 2002-9, Cl. MS, 33.177%, 3/25/326		121,884		23,634
Trust 2003-33, Cl. SP, 40.163%, 5/25/336		350,732		57,225
Trust 2003-4, Cl. S, 36.497%, 2/25/336		194,987		34,270
Trust 2003-46, Cl. IH, 16.403%, 6/1/236		1,063,523		132,960
Trust 2003-89, Cl. XS, 40.943%, 11/25/326		87,834		4,413
Trust 2004-54, Cl. DS, 51.305%, 11/25/306		182,972		34,373
Trust 2005-14, Cl. SE, 41.53%, 3/25/356		134,956		19,579
Trust 2005-40, Cl. SA, 60.391%, 5/25/356		505,274		89,975
Trust 2005-71, Cl. SA, 61.101%, 8/25/256		515,615		72,292
Trust 2005-93, Cl. SI, 18.704%, 10/25/356		96,809		14,289
Trust 2006-129, Cl. SM, 28.813%, 1/25/376		604,763		86,646
Trust 2006-60, Cl. DI, 38.798%, 4/25/356		81,947		11,823
Trust 2007-88, Cl. XI, 35.148%, 6/25/376		550,091		78,478
Trust 2008-55, Cl. SA, 25.574%, 7/25/386		381,957		42,398
Trust 2008-67, Cl. KS, 48.433%, 8/25/346		199,750		14,558
Trust 222, Cl. 2, 24.79%, 6/1/236		315,791		59,435
Trust 233, Cl. 2, 43.257%, 8/1/236		307,466		59,505
Trust 252, Cl. 2, 36.731%, 11/1/236		263,105		48,348
Trust 319, Cl. 2, 6.059%, 2/1/326		81,417		14,738
Trust 331, Cl. 9, 13.163%, 2/1/336		255,461		50,232
Trust 334, Cl. 17, 20.772%, 2/1/336		148,926		32,853
Trust 339, Cl. 12, 2.509%, 7/1/336		249,514		47,615
Trust 339, Cl. 7, 6.752%, 7/1/336		836,751		119,298
Trust 343, Cl. 13, 10.17%, 9/1/336		239,504		44,553
Trust 345, Cl. 9, 0%, 1/1/346,8		310,390		40,167
Trust 351, Cl. 10, 0.79%, 4/1/346		35,430		5,170
Trust 351, Cl. 8, 1.45%, 4/1/346		111,218		16,394
Trust 356, Cl. 10, 1.267%, 6/1/356		87,783		12,792
Trust 356, Cl. 12, 1.968%, 2/1/356		46,186		6,733
Trust 362, Cl. 13, 3.439%, 8/1/356		337,362		54,105
Trust 364, Cl. 16, 0.174%, 9/1/356		242,082		40,407
Federal National Mortgage Assn., Principal-Only Stripped Mtg.-Backed Security, Trust 1993-184, Cl. M, 4.309%, 9/25/237		117,021		105,902
				46,625,032
GNMA/Guaranteed—0.2%
Government National Mortgage Assn., 8%, 4/15/23		50,341		59,309
Government National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Series 2001-21, Cl. SB, 91.36%, 1/16/276		211,360		41,625
Series 2002-15, Cl. SM, 82.507%, 2/16/326		246,720		45,794
Series 2002-76, Cl. SY, 83.178%, 12/16/266		540,644		109,381
Series 2004-11, Cl. SM, 80.843%, 1/17/306		197,888		45,101
Series 2007-17, Cl. AI, 21.004%, 4/16/376		475,917		89,263
				390,473
Other Agency—0.2%
NCUA Guaranteed Notes Trust 2010-R3, Gtd. Nts., Series 2010-R3, Cl. 2A, 0.834%, 12/8/203		347,813		349,225
Non-Agency—5.2%
Commercial—3.7%
Banc of America Commercial Mortgage Trust 2007-1, Commercial Mtg. Pass-Through Certificates, Series 2007-1, Cl. A4, 5.451%, 1/1/49		355,000		387,161
Banc of America Commercial Mortgage, Inc., Commercial Mtg. Pass-Through Certificates, Series 2007-3, Cl. A4, 5.622%, 6/1/493		180,000		193,776

11 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Commercial Continued
Bear Stearns ARM Trust 2007-4, Mtg. Pass-Through Certificates, Series 2007-4, Cl. 22A1, 5.669%, 6/1/473	$	244,346	$	170,875
CFCRE Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2011-C1, Cl. A1, 1.871%, 4/1/442		67,207		67,053
CHL Mortgage Pass-Through Trust 2007-J3, Mtg. Pass-Through Certificates, Series 2007-J3, Cl. A9, 6%, 7/1/37		51,542		40,788
Citigroup Commercial Mortgage Trust 2008-C7, Commercial Mtg. Pass-Through Certificates, Series 2008-C7, Cl. A4, 6.072%, 12/1/493		300,000		334,582
Citigroup, Inc./Deutsche Bank 2007-CD4 Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2007-CD4, Cl. A4, 5.322%, 12/1/49		290,000		308,768
Deutsche Alt-B Securities, Inc., Mtg. Pass-Through Certificates, Series 2006-AB4, Cl. A1A, 6.005%, 10/25/36		238,868		130,853
Deutsche Mortgage & Asset Receiving, Commercial Mtg. Pass-Through Certificates, Series 2010-C1, Cl. A1, 3.156%, 7/1/462		278,414		286,650
Deutsche Mortgage & Asset Receiving, Commercial Mtg. Pass-Through Certificates, Interest-Only Stripped Mtg.-Backed Security, Series 2010-C1, Cl. XPA, 4.859%, 9/1/202,6		2,197,256		165,137
First Horizon Alternative Mortgage Securities Trust 2004-FA2, Mtg. Pass-Through Certificates, Series 2004-FA2, Cl. 3A1, 6%, 1/25/35		249,510		243,426
First Horizon Alternative Mortgage Securities Trust 2007-FA2, Mtg. Pass-Through Certificates, Series 2007-FA2, Cl. 1A1, 5.50%, 4/25/37		449,147		294,661
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG11, Commercial Mtg. Pass-Through Certificates, Series 2007-GG11, Cl. A4, 5.736%, 12/1/49		70,000		75,829
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. AM, 5.475%, 3/1/39		235,000		221,593
GS Mortgage Securities Corp. II, Commercial Mtg. Obligations, Series 2011-GC3, Cl. A1, 2.331%, 3/1/44		182,343		186,451
Impac CMB Trust Series 2005-4, Collateralized Asset-Backed Bonds, Series 2005-4, Cl. 1A1A, 0.834%, 5/25/353		148,829		101,340
IndyMac Index Mortgage Loan Trust 2005-AR23, Mtg. Pass-Through Certificates, Series 2005-AR23, Cl. 6A1, 5.11%, 11/1/353		315,769		215,229
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial Mtg. Pass-Through Certificates:
Series 2011-C3, Cl. A1, 1.875%, 2/1/462		209,174		210,091
Series 2010-C2, Cl. A2, 3.616%, 11/1/432		340,000		353,925
Series 2007-LDPX, Cl. A2S2, 5.187%, 1/1/494		127,552		128,776
Series 2007-LDP10, Cl. A3S, 5.317%, 1/1/49		355,000		366,823
Series 2007-LDPX, Cl. A3, 5.42%, 1/15/49		40,000		43,409
Series 2007-LD11, Cl. A2, 5.802%, 6/15/493		268,798		271,887
JPMorgan Mortgage Trust 2007-S3, Mtg. Pass-Through Certificates, Series 2007-S3, Cl. 1A90, 7%, 8/1/37		332,593		279,692
LB-UBS Commercial Mortgage Trust 2007-C1, Commercial Mtg. Pass-Through Certificates, Series 2007-C1, Cl. A2, 5.318%, 2/11/40		107,611		107,690
LB-UBS Commercial Mortgage Trust 2007-C6, Commercial Mtg. Pass-Through Certificates, Series 2007-C6, Cl. A4, 5.858%, 7/11/40		415,000		456,450
Mastr Adjustable Rate Mortgages Trust 2004-13, Mtg. Pass-Through Certificates, Series 2004-13, Cl. 2A2, 2.664%, 4/1/343		198,378		191,352
Mastr Alternative Loan Trust 2004-6, Mtg. Pass-Through Certificates, Series 2004-6, Cl. 10A1, 6%, 7/25/34		470,261		482,720
Morgan Stanley Capital I Trust 2007-IQ15, Commercial Mtg. Pass-Through Certificates, Series 2007-IQ15, Cl. AM, 5.879%, 6/1/493		230,000		217,466
Structured Adjustable Rate Mortgage Loan Trust, Mtg. Pass-Through Certificates, Series 2007-6, Cl. 3A1, 5.118%, 7/1/373		304,680		183,410
Wachovia Bank Commercial Mortgage Trust 2007-C34, Commercial Mtg. Pass-Through Certificates, Series 2007-C34, Cl. A3, 5.678%, 5/1/46		260,000		286,373

12 | OPPENHEIMER BALANCED FUND/VA

	Principal
	Amount		Value
Commercial Continued
WaMu Mortgage Pass-Through Certificates 2005-AR14 Trust, Mtg. Pass-Through Certificates, Series 2005-AR14, Cl. 1A4, 2.474%, 12/1/353	$	153,943	$	119,433
Wells Fargo Commercial Mortgage Trust 2010-C1, Commercial Mtg. Pass-Through Certificates, Series 2010-C1, Cl. A1, 3.349%, 11/1/432		176,891		183,613
Wells Fargo Mortgage-Backed Securities 2007-AR8 Trust, Mtg. Pass-Through Certificates, Series 2007-AR8, Cl. A1, 6.042%, 11/1/373		213,735		155,757
WFRBS Commercial Mortgage Trust 2011-C3, Interest-Only Commercial Mtg. Pass-Through Certificates, Series 2011-C3, Cl. XA, 7.82%, 3/1/446		2,833,135		251,663
				7,714,702
Multifamily—0.3%
Citigroup Mortgage Loan Trust, Inc. 2006-AR3, Mtg. Pass-Through Certificates, Series 2006-AR3, Cl. 1A2A, 5.672%, 6/1/363		203,226		165,839
JPMorgan Mortgage Trust 2007-A3, Mtg. Pass-Through Certificates, Series 2007-A3, Cl. 3A2M, 5.259%, 5/1/373		42,477		34,372
Wells Fargo Mortgage-Backed Securities 2006-AR6 Trust, Mtg. Pass-Through Certificates, Series 2006-AR6, Cl. 3A1, 2.689%, 3/25/363		521,619		417,110
				617,321
Other—0.2%
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. A4, 5.444%, 3/1/39		320,000		347,679
Residential—1.0%
Banc of America Funding 2007-C Trust, Mtg. Pass-Through Certificates, Series 2007-C, Cl. 1A4, 5.544%, 5/1/363		80,000		70,893
Banc of America Mortgage Securities, Inc., Mtg. Pass-Through Certificates, Series 2004-E, Cl. 2A6, 2.866%, 6/1/343		128,623		113,717
CHL Mortgage Pass-Through Trust 2005-29, Mtg. Pass-Through Certificates, Series 2005-29, Cl. A1, 5.75%, 12/1/35		62,243		52,213
CHL Mortgage Pass-Through Trust 2006-6, Mtg. Pass-Through Certificates, Series 2006-6, Cl. A3, 6%, 4/1/36		169,268		161,050
Countrywide Alternative Loan Trust 2005-29CB, Mtg. Pass-Through Certificates, Series 2005-29CB, Cl. A4, 5%, 7/1/35		688,524		540,622
Countrywide Alternative Loan Trust 2007-19, Mtg. Pass-Through Certificates, Series 2007-19, Cl. 1A34, 6%, 8/1/37		195,456		136,115
GSR Mortgage Loan Trust 2006-5F, Mtg. Pass-Through Certificates, Series 2006-5F, Cl. 2A1, 6%, 6/1/36		169,436		164,920
JPMorgan Alternative Loan Trust 2006-S4, Mtg. Pass-Through Certificates, Series 2006-S4, Cl. A6, 5.71%, 12/1/36		119,999		103,140
RALI Series 2003-QS1 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2003-QS1, Cl. A2, 5.75%, 1/25/33		116,801		121,208
RALI Series 2006-QS13 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2006-QS13, Cl. 1A8, 6%, 9/25/36		24,192		13,734
Residential Asset Securitization Trust 2005-A15, Mtg. Pass-Through Certificates, Series 2005-A15, Cl. 1A4, 5.75%, 2/1/36		39,406		30,547
WaMu Mortgage Pass-Through Certificates 2007-HY5 Trust, Mtg. Pass-Through Certificates, Series 2007-HY5, Cl. 3A1, 5.467%, 5/1/373		204,503		170,770
Wells Fargo Alternative Loan 2007-PA5 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2007-PA5, Cl. 1A1, 6.25%, 11/1/37		174,937		136,051
Wells Fargo Mortgage-Backed Securities 2004-R Trust, Mtg. Pass-Through Certificates, Series 2004-R, Cl. 2A1, 2.625%, 9/1/343		85,387		81,395
Wells Fargo Mortgage-Backed Securities 2006-AR14 Trust, Mtg. Pass-Through Certificates, Series 2006-AR14, Cl. 1A2, 5.667%, 10/1/363		198,909		167,167
				2,063,542
Total Mortgage-Backed Obligations (Cost $56,907,510)				58,107,974

13 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
U.S. Government Obligations—0.6%
Federal Home Loan Mortgage Corp. Nts.:
2%, 8/25/16	$	65,000	$	67,696
2.50%, 5/27/16		100,000		106,063
5%, 2/16/17		115,000		135,958
5.25%, 4/18/16		195,000		230,030
5.50%, 7/18/16		110,000		131,364
Federal National Mortgage Assn. Nts.:
2.375%, 4/11/169		190,000		201,032
4.875%, 12/15/16		160,000		188,755
5%, 3/15/169		120,000		140,028
Total U.S. Government Obligations (Cost $1,127,545)				1,200,926
Non-Convertible Corporate Bonds and Notes—18.3%
Consumer Discretionary—3.0%
Automobiles—0.3%
Daimler Finance North America LLC, 1.875% Sr. Unsec. Nts., 9/15/142		153,000		152,291
DaimlerChrysler NA Holdings Corp., 8.50% Nts., 1/18/31		88,000		123,203
Ford Motor Credit Co. LLC, 5.875% Sr. Unsec. Nts., 8/2/21		236,000		246,321
				521,815
Diversified Consumer Services—0.1%
Service Corp. International, 6.75% Sr. Unsec. Nts., 4/1/15		230,000		248,400
Hotels, Restaurants & Leisure—0.3%
Hyatt Hotels Corp., 5.75% Sr. Unsec. Unsub. Nts., 8/15/152		349,000		374,101
Marriott International, Inc., 6.20% Sr. Unsec. Unsub. Nts., 6/15/16		255,000		286,944
				661,045
Household Durables—0.3%
Jarden Corp., 6.125% Sr. Unsec. Nts., 11/15/22		201,000		206,528
Newell Rubbermaid, Inc., 5.50% Sr. Unsec. Nts., 4/15/13		223,000		233,922
Whirlpool Corp.:
5.50% Sr. Unsec. Unsub. Nts., 3/1/13		90,000		93,567
8% Sr. Unsec. Nts., 5/1/12		180,000		184,037
				718,054
Leisure Equipment & Products—0.1%
Mattel, Inc., 5.625% Sr. Unsec. Nts., 3/15/13		215,000		225,985
Media—1.3%
Comcast Cable Communications Holdings, Inc., 9.455% Sr. Unsec. Nts., 11/15/22		138,000		196,932
Comcast Corp., 6.40% Sr. Unsec. Nts., 3/1/40		52,000		64,752
CSC Holdings, Inc., 7.625% Sr. Unsec. Debs., 7/15/18		188,000		207,740
DIRECTV Holdings LLC/DIRECTV Financing Co., Inc., 6.375% Sr. Unsec. Nts., 3/1/41		182,000		210,208
Dish DBS Corp., 6.75% Sr. Unsec. Nts., 6/1/21		201,000		217,583
Historic TW, Inc., 9.125% Debs., 1/15/13		78,000		84,128
Interpublic Group of Cos., Inc. (The):
6.25% Sr. Unsec. Nts., 11/15/14		80,000		85,400
10% Sr. Unsec. Nts., 7/15/17		264,000		302,940
Lamar Media Corp., 9.75% Sr. Unsec. Nts., 4/1/14		218,000		245,250
News America, Inc., 6.15% Sr. Unsec. Nts., 2/15/41		130,000		150,098
Time Warner Entertainment Co. LP, 8.375% Sr. Nts., 7/15/33		122,000		160,126
Time Warner, Inc., 4% Sr. Unsec. Unsub. Nts., 1/15/22		203,000		209,734
Virgin Media Secured Finance plc:
5.25% Sr. Sec. Nts., 1/15/21		132,000		140,053
6.50% Sr. Sec. Nts., 1/15/18		282,000		301,035
				2,575,979
Multiline Retail—0.3%
Family Dollar Stores, Inc., 5% Sr. Unsec. Nts., 2/1/21		127,000		130,891
Macy’s Retail Holdings, Inc., 5.75% Sr. Unsec. Nts., 7/15/14		336,000		357,659
Target Corp., 7% Bonds, 1/15/38		46,000		64,408
				552,958
Specialty Retail—0.3%
Limited Brands, Inc., 6.625% Sr. Nts., 4/1/21		198,000		210,870
Rent-A-Center, Inc., 6.625% Sr. Unsec. Nts., 11/15/20		240,000		243,000
Sally Holdings LLC/Sally Capital, Inc., 6.875% Sr. Unsec. Nts., 11/15/192		214,000		224,700
				678,570

14 | OPPENHEIMER BALANCED FUND/VA

	Principal
	Amount		Value
Consumer Staples—1.2%
Beverages—0.2%
Anheuser-Busch Inbev Worldwide, Inc., 7.75% Sr. Unsec. Unsub. Nts., 1/15/19	$	111,000	$	143,926
Fortune Brands, Inc., 6.375% Sr. Unsec. Unsub. Nts., 6/15/14		55,000		60,185
Pernod-Ricard SA, 4.45% Sr. Unsec. Nts., 1/15/222		211,000		221,399
				425,510
Food & Staples Retailing—0.2%
CVS Caremark Corp., 6.125% Sr. Unsec. Unsub. Nts., 9/15/39		80,000		97,521
Delhaize Group, 5.70% Sr. Unsec. Nts., 10/1/40		63,000		64,785
Kroger Co. (The), 5% Sr. Nts., 4/15/13		199,000		208,270
				370,576
Food Products—0.4%
Bunge Ltd. Finance Corp.:
5.35% Sr. Unsec. Unsub. Nts., 4/15/14		29,000		30,436
8.50% Sr. Unsec. Nts., 6/15/19		155,000		188,888
Kraft Foods, Inc.:
6% Sr. Unsec. Nts., 2/11/13		207,000		218,160
6.50% Sr. Unsec. Unsub. Nts., 2/9/40		120,000		156,388
TreeHouse Foods, Inc., 7.75% Sr. Unsec. Nts., 3/1/18		240,000		260,400
				854,272
Household Products—0.1%
Energizer Holdings, Inc., 4.70% Sr. Nts., 5/19/212		233,000		245,581
Tobacco—0.3%
Altria Group, Inc., 10.20% Sr. Unsec. Nts., 2/6/39		177,000		275,834
Lorillard Tobacco Co., 7% Sr. Unsec. Nts., 8/4/41		149,000		156,856
Reynolds American, Inc., 7.25% Sr. Sec. Nts., 6/1/13		214,000		229,619
				662,309
Energy—2.5%
Energy Equipment & Services—0.6%
Ensco plc, 4.70% Sr. Unsec. Nts., 3/15/21		235,000		245,096
Nabors Industries, Inc., 6.15% Sr. Unsec. Unsub. Nts., 2/15/18		286,000		319,817
Precision Drilling Corp.:
6.50% Sr. Unsec. Nts., 12/15/212		102,000		104,550
6.625% Sr. Unsec. Nts., 11/15/20		97,000		99,668
Rowan Cos., Inc., 5% Sr. Unsec. Nts., 9/1/17		244,000		256,764
Weatherford International Ltd. Bermuda, 5.125% Sr. Unsec. Unsub. Nts., 9/15/20		242,000		251,833
				1,277,728
Oil, Gas & Consumable Fuels—1.9%
Anadarko Petroleum Corp., 6.20% Sr. Unsec. Nts., 3/15/40		145,000		161,640
BG Energy Capital plc, 4% Sr. Unsec. Nts., 10/15/212		152,000		156,930
Bill Barrett Corp., 7.625% Sr. Unsec. Unsub. Nts., 10/1/19		199,000		208,950
Canadian Oil Sands Ltd., 5.80% Sr. Unsec. Nts., 8/15/132		213,000		226,074
Cloud Peak Energy Resources LLC, 8.25% Sr. Unsec. Unsub. Nts., 12/15/17		215,000		230,050
El Paso Pipeline Partners LP, 6.50% Sr. Unsec. Nts., 4/1/20		330,000		365,234
Encana Corp., 3.90% Sr. Unsec. Unsub. Nts., 11/15/21		79,000		79,493
Energy Transfer Partners LP, 4.65% Sr. Unsec. Unsub. Nts., 6/1/21		172,000		168,744
EQT Corp., 4.875% Sr. Unsec. Unsub. Nts., 11/15/21		130,000		131,432
Kaneb Pipe Line Operating Partnership LP, 5.875% Sr. Unsec. Nts., 6/1/13		383,000		403,854
Marathon Petroleum Corp., 5.125% Sr. Unsec. Unsub. Nts., 3/1/21		110,000		115,082
Newfield Exploration Co., 6.875% Sr. Unsec. Sub. Nts., 2/1/20		195,000		209,625
Nexen, Inc., 6.40% Sr. Unsec. Unsub. Bonds, 5/15/37		245,000		259,918
Range Resources Corp., 8% Sr. Unsec. Sub. Nts., 5/15/19		212,000		237,440
Ras Laffan Liquefied Natural Gas Co. Ltd. III, 5.50% Sr. Sec. Nts., 9/30/142		140,000		150,500
Rockies Express Pipeline LLC, 3.90% Sr. Unsec. Unsub. Nts., 4/15/152		393,000		388,715
Sunoco Logistics Partners Operations LP, 7.25% Sr. Unsec. Nts., 2/15/12		214,000		215,395
Woodside Finance Ltd., 4.60% Sr. Unsec. Nts., 5/10/212		165,000		168,731
				3,877,807

15 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Financials—5.6%
Capital Markets—1.3%
Blackstone Holdings Finance Co. LLC, 6.625% Sr. Unsec. Nts., 8/15/192	$	405,000	$	429,052
Goldman Sachs Capital, Inc. (The), 6.345% Sub. Bonds, 2/15/34		232,000		196,624
Goldman Sachs Group, Inc. (The):
5.25% Sr. Unsec. Nts., 7/27/21		326,000		318,497
6.25% Sr. Nts., 2/1/41		206,000		202,412
Macquarie Bank Ltd., 6.625% Unsec. Sub. Nts., 4/7/212		314,000		289,883
Morgan Stanley:
5.50% Sr. Unsec. Unsub. Nts., 7/24/202		114,000		103,789
5.55% Sr. Unsec. Unsub. Nts., Series F, 4/27/17		595,000		574,843
Nomura Holdings, Inc., 4.125% Sr. Unsec. Unsub. Nts., 1/19/16		223,000		217,861
TD Ameritrade Holding Corp., 2.95% Sr. Unsec. Unsub. Nts., 12/1/12		237,000		240,025
UBS AG Stamford CT, 2.25% Sr. Unsec. Nts., 8/12/13		94,000		93,210
				2,666,196
Commercial Banks—1.0%
ANZ National International Ltd., 2.375% Sr. Unsec. Nts., 12/21/122		258,000		262,526
Fifth Third Cap Trust IV, 6.50% Jr. Unsec. Sub. Nts., 4/15/37		433,000		426,505
HSBC Finance Capital Trust IX, 5.911% Nts., 11/30/353		510,000		425,850
Lloyds TSB Bank plc, 6.50% Unsec. Sub. Nts., 9/14/202		174,000		145,779
Mercantile Bankshares Corp., 4.625% Unsec. Sub. Nts., Series B, 4/15/13		147,000		153,246
Sumitomo Mitsui Banking Corp., 8% Unsec. Sub. Nts., 6/15/12		227,000		232,579
Wells Fargo & Co., 7.98% Jr. Sub. Perpetual Bonds, Series K10		162,000		174,353
Zions Bancorp., 7.75% Sr. Unsec. Nts., 9/23/14		306,000		324,687
				2,145,525
Consumer Finance—0.5%
American Express Bank FSB, 5.50% Sr. Unsec. Nts., 4/16/13		223,000		233,187
American Express Credit Corp., 2.80% Sr. Unsec. Unsub. Nts., 9/19/16		209,000		210,301
Capital One Financial Corp., 4.75% Sr. Nts., 7/15/21		205,000		211,291
SLM Corp., 6.25% Sr. Nts., 1/25/16		312,000		303,734
				958,513
Diversified Financial Services—0.9%
Bank of America Corp., 3.75% Sr. Unsec. Unsub. Nts., 7/12/16		230,000		213,222
Citigroup, Inc., 6.125% Sr. Unsec. Unsub. Nts., 11/21/17		669,000		715,037
Glen Meadow Pass-Through Trust, 6.505% Bonds, 2/12/673,4		300,000		213,750
Irish Life & Permanent Group Holdings plc, 3.60% Sr. Unsec. Unsub. Nts., 1/14/132		120,000		106,153
JPMorgan Chase & Co.:
5.40% Sr. Unsec. Nts., 1/6/42		60,000		62,729
7.90% Perpetual Bonds, Series 110		379,000		404,879
Merrill Lynch & Co., Inc., 7.75% Jr. Sub. Bonds, 5/14/38		193,000		183,612
				1,899,382
Insurance—1.5%
Burlington Northern Santa Fe LLC, 5.75% Sr. Unsec. Bonds, 5/1/40		60,000		71,915
CNA Financial Corp.:
5.75% Sr. Unsec. Unsub. Nts., 8/15/21		197,000		201,319
5.875% Sr. Unsec. Unsub. Bonds, 8/15/20		114,000		117,264
Gulf South Pipeline Co. LP, 5.75% Sr. Unsec. Nts., 8/15/122		212,000		216,706
Hartford Financial Services Group, Inc. (The), 6.625% Sr. Unsec. Unsub. Nts., 3/30/40		139,000		138,155
International Lease Finance Corp., 5.75% Sr. Unsec. Unsub. Nts., 5/15/16		228,000		211,718
Liberty Mutual Group, Inc., 5% Sr. Nts., 6/1/212		342,000		335,624
Lincoln National Corp., 6.05% Jr. Unsec. Sub. Bonds, 4/20/67		466,000		391,440
Prudential Financial, Inc., 5.375% Sr. Unsec. Unsub. Nts., 6/21/20		386,000		413,674
Swiss Re Capital I LP, 6.854% Perpetual Bonds2,10		455,000		389,030
Unum Group, 5.625% Sr. Unsec. Unsub. Nts., 9/15/20		146,000		150,538
Willis Group Holdings plc, 4.125% Sr. Unsec. Unsub. Nts., 3/15/16		241,000		245,050
ZFS Finance USA Trust V, 6.50% Jr. Sub. Bonds, 5/9/373,4		252,000		228,060
				3,110,493
Real Estate Investment Trusts—0.4%
Brandywine Operating Partnership LP, 5.75% Sr. Unsec. Unsub. Nts., 4/1/12		123,000		123,794
CommonWealth REIT, 6.95% Sr. Unsec. Nts., 4/1/12		54,000		54,000

16 | OPPENHEIMER BALANCED FUND/VA

	Principal
	Amount		Value
Real Estate Investment Trusts Continued
Duke Realty LP, 6.25% Sr. Unsec. Unsub. Nts., 5/15/13	$	216,000	$	225,990
Mack-Cali Realty LP, 5.25% Sr. Unsec. Unsub. Nts., 1/15/12		93,000		93,070
WCI Finance LLC/WEA Finance LLC, 5.40% Sr. Unsec. Unsub. Nts., 10/1/122		226,000		231,603
				728,457
Health Care—0.4%
Biotechnology—0.1%
Celgene Corp., 5.70% Sr. Unsec. Nts., 10/15/40		145,000		159,867
Health Care Providers & Services—0.2%
McKesson Corp., 6% Sr. Unsec. Unsub. Nts., 3/1/41		124,000		158,786
Quest Diagnostics, Inc., 5.75% Sr. Unsec. Nts., 1/30/40		145,000		156,655
				315,441
Pharmaceuticals—0.1%
Mylan, Inc., 6% Sr. Nts., 11/15/182		245,000		253,269
Industrials—1.3%
Aerospace & Defense—0.2%
Alliant Techsystems, Inc., 6.75% Sr. Sub. Nts., 4/1/16		230,000		236,900
BE Aerospace, Inc., 8.50% Sr. Unsec. Nts., 7/1/18		205,000		225,500
				462,400
Commercial Services & Supplies—0.2%
Corrections Corp. of America, 7.75% Sr. Nts., 6/1/17		235,000		256,150
R.R. Donnelley & Sons Co., 8.60% Sr. Unsec. Unsub. Nts., 8/15/16		203,000		204,269
				460,419
Industrial Conglomerates—0.4%
General Electric Capital Corp.:
4.25% Sr. Unsec. Nts., Series A, 6/15/12		215,000		217,632
4.65% Sr. Unsec. Nts., 10/17/21		203,000		212,198
5.25% Sr. Unsec. Nts., 10/19/12		34,000		35,197
6.375% Unsec. Sub. Bonds, 11/15/67		428,000		422,650
				887,677
Machinery—0.3%
CNH Capital LLC, 6.25% Sr. Unsec. Nts., 11/1/162		214,000		221,490
Joy Global, Inc., 5.125% Sr. Unsec. Unsub. Nts., 10/15/21		97,000		103,704
SPX Corp., 6.875% Sr. Unsec. Nts., 9/1/172		192,000		208,320
				533,514
Professional Services—0.0%
FTI Consulting, Inc., 6.75% Sr. Unsec. Nts., 10/1/20		35,000		36,313
Road & Rail—0.2%
CSX Corp., 5.50% Sr. Unsec. Nts., 4/15/41		62,000		70,357
Kansas City Southern de Mexico, 8% Sr. Unsec. Unsub. Nts., 2/1/18		185,000		204,425
				274,782
Information Technology—0.8%
Communications Equipment—0.1%
Harris Corp., 6.15% Sr. Unsec. Nts., 12/15/40		71,000		80,430
Juniper Networks, Inc., 5.95% Sr. Unsec. Unsub. Nts., 3/15/41		93,000		101,891
				182,321
Computers & Peripherals—0.2%
Hewlett-Packard Co.:
2.35% Sr. Unsec. Unsub. Nts., 3/15/15		216,000		215,152
4.65% Sr. Unsec. Nts., 12/9/21		167,000		176,479
				391,631
Electronic Equipment & Instruments—0.2%
Arrow Electronics, Inc., 3.375% Sr. Unsec. Unsub. Nts., 11/1/15		430,000		431,014
Office Electronics—0.1%
Xerox Corp., 5.65% Sr. Unsec. Nts., 5/15/13		223,000		234,207
Semiconductors & Semiconductor Equipment—0.1%
KLA-Tencor Corp., 6.90% Sr. Unsec. Nts., 5/1/18		157,000		181,234
Software—0.1%
Symantec Corp., 4.20% Sr. Unsec. Unsub. Nts., 9/15/20		264,000		265,844
Materials—1.3%
Chemicals—0.4%
Agrium, Inc., 6.125% Sr. Unsec. Nts., 1/15/41		101,000		125,502
Airgas, Inc., 3.25% Sr. Nts., 10/1/15		374,000		385,194
Ashland, Inc., 9.125% Sr. Unsec. Nts., 6/1/17		210,000		235,200
Potash Corp. of Saskatchewan, Inc., 5.625% Sr. Unsec. Unsub. Nts., 12/1/40		140,000		171,269
				917,165
Containers & Packaging—0.1%
Sealed Air Corp., 7.875% Sr. Nts., 6/15/17		180,000		190,029

17 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
Metals & Mining—0.7%
Freeport-McMoRan Copper & Gold, Inc., 8.375% Sr. Nts., 4/1/17	$	330,000		$	350,997
Petrohawk Energy Corp., 6.25% Sr. Unsec. Nts., 6/1/19		307,000			339,235
Teck Resources Ltd., 7% Sr. Unsec. Unsub. Nts., 9/15/12		216,000			224,263
Vale Inco Ltd., 5.70% Sr. Unsec. Unsub. Nts., 10/15/15		14,000			15,258
Xstrata Canada Corp.:
5.375% Sr. Unsec. Unsub. Nts., 6/1/15		75,000			81,520
6% Sr. Unsec. Unsub. Nts., 10/15/15		177,000			190,853
7.25% Sr. Unsec. Unsub. Nts., 7/15/12		94,000			96,846
Xstrata Finance Canada Ltd., 5.80% Sr. Unsec. Unsub. Bonds, 11/15/162		35,000			38,230
					1,337,202
Paper & Forest Products—0.1%
International Paper Co., 4.75% Sr. Unsec. Unsub. Nts., 2/15/22		172,000			183,117
Telecommunication Services—1.0%
Diversified Telecommunication Services—0.7%
AT&T, Inc., 6.30% Sr. Unsec. Bonds, 1/15/38		236,000			290,234
British Telecommunications plc, 9.875% Bonds, 12/15/30		142,000			200,367
CenturyLink, Inc., 7.60% Sr. Unsec. Unsub. Nts., Series P, 9/15/39		82,000			80,574
Frontier Communications Corp., 8.25% Sr. Unsec. Nts., 4/15/17		230,000			236,325
Qwest Corp., 7.625% Sr. Unsec. Unsub. Nts., 6/15/15		225,000			250,511
Verizon Communications, Inc., 6.40% Sr. Unsec. Nts., 2/15/38		134,000			170,389
Windstream Corp., 7.875% Sr. Unsec. Unsub. Nts., 11/1/17		192,000			208,800
					1,437,200
Wireless Telecommunication Services—0.3%
America Movil SAB de CV, 2.375% Unsec. Unsub. Nts., 9/8/16		349,000			349,849
American Tower Corp.:
5.05% Sr. Unsec. Unsub. Nts., 9/1/20		50,000			50,160
7% Sr. Unsec. Nts., 10/15/17		162,000			183,207
					583,216
Utilities—1.2%
Electric Utilities—1.0%
Allegheny Energy Supply Co. LLC, 8.25% Bonds, 4/15/122		205,000			208,721
Edison International, 3.75% Sr. Unsec. Unsub. Nts., 9/15/17		154,000			158,714
FirstEnergy Solutions Corp., 6.80% Sr. Unsec. Nts., 8/15/39		138,000			154,772
Great Plains Energy, Inc., 2.75% Sr. Unsec. Unsub. Nts., 8/15/13		239,000			242,524
Kansas City Power & Light Co., 5.30% Sr. Unsec. Nts., 10/1/41		120,000			129,399
Northeast Utilities Co., 7.25% Sr. Unsec. Nts., 4/1/12		230,000			233,273
Oncor Electric Delivery Co., 7% Debs., 9/1/22		198,000			254,036
PPL WEM Holdings plc, 5.375% Sr. Unsec. Nts., 5/1/212		322,000			338,161
Texas-New Mexico Power Co., 9.50% Sec. Nts., 4/1/192		235,000			308,556
					2,028,156
Energy Traders—0.1%
TransAlta Corp., 5.75% Sr. Unsec. Nts., 12/15/13		212,000			227,064
Multi-Utilities—0.1%
CMS Energy Corp., 6.25% Sr. Unsec. Nts., 2/1/20		194,000			204,628
Pacific Gas & Electric Co., 4.50% Sr. Unsec. Nts., 12/15/41		53,000			54,303
					258,931
Total Non-Convertible Corporate Bonds and Notes (Cost $36,798,681)					37,637,168
		Shares
Investment Companies—15.9%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%11,12 (Cost $32,784,414)		32,784,414			32,784,414
Total Investments, at Value (Cost $232,141,466)		115.4	%		237,714,032
Liabilities in Excess of Other Assets		(15.4	)		(31,779,971	)
Net Assets		100.0	%	$	205,934,061

18 OPPENHEIMER BALANCED FUND/VA

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Non-income producing security.
2.	Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $11,723,347 or 5.69% of the Fund’s net assets as of December 30, 2011.
3.	Represents the current interest rate for a variable or increasing rate security.
4.	Restricted security. The aggregate value of restricted securities as of December 30, 2011 was $1,000,078, which represents 0.49% of the Fund’s net assets. See Note 6 of the accompanying Notes. Information concerning restricted securities is as follows:

							Unrealized
	Acquisition						Appreciation
Security	Dates		Cost		Value		(Depreciation)
DT Auto Owner Trust 2011-3A, Automobile Receivable Nts., Series 2011-3A, Cl. C, 4.03%, 12/15/41		11/2/11	$	200,984	$	200,600	$	(384	)
Glen Meadow Pass-Through Trust, 6.505% Bonds, 2/12/67		1/5/11-10/11/11		251,672		213,750		(37,922	)
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial Mtg. Pass-Through Certificates, Series 2007-LDPX, Cl. A2S2, 5.187%, 1/1/49		7/14/10		125,957		128,776		2,819
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/17		2/4/11-4/14/11		231,246		228,892		(2,354	)
ZFS Finance USA Trust V, 6.50% Jr. Sub. Bonds, 5/9/37		2/24/11-7/26/11		254,109		228,060		(26,049	)
			$	1,063,968	$	1,000,078	$	(63,890	)

5.	When-issued security or delayed delivery to be delivered and settled after December 30, 2011. See Note 1 of the accompanying Notes.
6.	Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans or other receivables. 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 or asset-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. These securities amount to $2,771,932 or 1.35% of the Fund’s net assets as of December 30, 2011.
7.	Principal-Only Strips represent the right to receive the monthly principal payments on an underlying pool of mortgage loans. The value of these securities generally increases as interest rates decline and prepayment rates rise. The price of these securities is typically more volatile than that of coupon-bearing bonds of the same maturity. Interest rates disclosed represent current yields based upon the current cost basis and estimated timing of future cash flows. These securities amount to $144,097 or 0.07% of the Fund’s net assets as of December 30, 2011.
8.	The current amortization rate of the security’s cost basis exceeds the future interest payments currently estimated to be received. Both the amortization rate and interest payments are contingent on future mortgage pre-payment speeds and are therefore subject to change.
9.	All or a portion of the security position is held in collateralized accounts to cover initial margin requirements on open futures contracts and written options on futures, if applicable. The aggregate market value of such securities is $212,701. See Note 5 of the accompanying Notes.
10.	This bond has no contractual maturity date, is not redeemable and contractually pays an indefinite stream of interest. Rate reported represents the current interest rate for this variable rate security.
11.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		45,755,638		100,641,276		113,612,500		32,784,414
					Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E					$	32,784,414	$	80,528

12. Rate shown is the 7-day yield as of December 30, 2011.

19 | OPPENHEIMER BALANCED FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

							Level 3—
	Level 1—			Level 2—			Significant
	Unadjusted			Other Significant			Unobservable
	Quoted Prices			Observable Inputs			Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	13,343,882		$	—		$	—	$	13,343,882
Consumer Staples		8,172,220			—			—		8,172,220
Energy		15,031,008			—			—		15,031,008
Financials		22,838,192			—			—		22,838,192
Health Care		11,901,124			—			—		11,901,124
Industrials		6,100,408			—			—		6,100,408
Information Technology		9,696,316			—			—		9,696,316
Materials		3,204,032			—			—		3,204,032
Telecommunication Services		3,593,924			—			—		3,593,924
Utilities		5,227,430			—			—		5,227,430
Asset-Backed Securities		—			8,875,014			—		8,875,014
Mortgage-Backed Obligations		—			58,107,974			—		58,107,974
U.S. Government Obligations		—			1,200,926			—		1,200,926
Non-Convertible Corporate Bonds and Notes		—			37,637,168			—		37,637,168
Investment Company		32,784,414			—			—		32,784,414
Total Investments, at Value		131,892,950			105,821,082			—		237,714,032
Other Financial Instruments:
Futures margins		18,316			—			—		18,316
Foreign currency exchange contracts		—			28,920			—		28,920
Total Assets	$	131,911,266		$	105,850,002		$	—	$	237,761,268
Liabilities Table
Other Financial Instruments:
Futures margins	$	(11,188	)	$	—		$	—	$	(11,188	)
Foreign currency exchange contracts		—			(8,731	)		—		(8,731	)
Total Liabilities	$	(11,188	)	$	(8,731	)	$	—	$	(19,919	)

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

20 |  OPPENHEIMER BALANCED FUND/VA

Foreign Currency Exchange Contracts as of December 30, 2011 are as follows:

Counterparty/		Contract	Expiration				Unrealized		Unrealized
Contract Description	Buy/Sell	Amount (000’s)	Dates		Value		Appreciation		Depreciation
Brown Brothers Harriman
Japanese Yen (JPY)	Sell	36,617 JPY		1/6/12	$	475,728	$	208	$	—
Bank of America
Japanese Yen (JPY)	Sell	61,566 JPY		1/4/12-1/5/12		799,924		—		8,731
Chase Manhattan Bank
Swiss Franc (CHF)	Sell	4,647 CHF		1/3/12		4,947,229		28,712		—
							$	28,920	$	8,731

Futures Contracts as of December 30, 2011 are as follows:

								Unrealized
		Number of		Expiration				Appreciation
Contract Description	Buy/Sell	Contracts		Date		Value		(Depreciation)
U.S. Long Bonds	Buy		24		3/21/12	$	3,475,500	$	42,776
U.S. Treasury Nts., 10 yr.	Buy		1		3/21/12		131,125		6
U.S. Treasury Nts., 2 yr.	Sell		54		3/30/12		11,909,531		(3,064	)
U.S. Treasury Nts., 5 yr.	Sell		37		3/30/12		4,560,539		(17,547	)
U.S. Treasury Ultra Bonds	Buy		21		3/21/12		3,363,938		20,631
								$	42,802

See accompanying Notes to Financial Statements.

21 |  OPPENHEIMER BALANCED FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $199,357,052)	$	204,929,618
Affiliated companies (cost $32,784,414)		32,784,414
		237,714,032
Cash		55,568
Unrealized appreciation on foreign currency exchange contracts		28,920
Receivables and other assets:
Investments sold (including $834,575 sold on a when-issued or delayed delivery basis)		2,110,172
Interest, dividends and principal paydowns		934,679
Futures margins		18,316
Other		15,397
Total assets		240,877,084
Liabilities
Unrealized depreciation on foreign currency exchange contracts		8,731
Payables and other liabilities:
Investments purchased on a when-issued or delayed delivery basis		34,608,626
Shares of beneficial interest redeemed		134,661
Shareholder communications		45,714
Transfer and shareholder servicing agent fees		17,606
Distribution and service plan fees		15,095
Trustees’ compensation		13,626
Futures margins		11,188
Other		87,776
Total liabilities		34,943,023
Net Assets	$	205,934,061
Composition of Net Assets
Par value of shares of beneficial interest	$	18,310
Additional paid-in capital		261,404,840
Accumulated net investment income		3,885,373
Accumulated net realized loss on investments and foreign currency transactions		(64,994,840	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		5,620,378
Net Assets	$	205,934,061
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $128,383,141 and 11,366,261 shares of beneficial interest outstanding)	$	11.30
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $77,550,920 and 6,943,916 shares of beneficial interest outstanding)	$	11.17

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

22 |  OPPENHEIMER BALANCED FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Interest	$	3,740,550
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $41,729)		1,555,903
Affiliated companies		80,528
Total investment income		5,376,981
Expenses
Management fees		1,695,109
Distribution and service plan fees—Service shares		212,975
Transfer and shareholder servicing agent fees:
Non-Service shares		141,905
Service shares		85,192
Shareholder communications:
Non-Service shares		34,918
Service shares		20,972
Custodian fees and expenses		23,781
Trustees’ compensation		11,530
Administration service fees		1,500
Other		51,445
Total expenses		2,279,327
Less waivers and reimbursements of expenses		(545,502	)
Net expenses		1,733,825
Net Investment Income		3,643,156
Realized and Unrealized Gain (Loss)
Net realized gain on:
Investments from unaffiliated companies		7,451,196
Closing and expiration of futures contracts		1,402,952
Foreign currency transactions		721,809
Net realized gain		9,575,957
Net change in unrealized appreciation/depreciation on:
Investments		(10,948,759	)
Translation of assets and liabilities denominated in foreign currencies		(559,038	)
Futures contracts		50,474
Net change in unrealized appreciation/depreciation		(11,457,323	)
Net Increase in Net Assets Resulting from Operations	$	1,761,790

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

23 |  OPPENHEIMER BALANCED FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	3,643,156		$	4,859,704
Net realized gain		9,575,957			16,046,665
Net change in unrealized appreciation/depreciation		(11,457,323	)		7,623,134
Net increase in net assets resulting from operations		1,761,790			28,529,503
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(3,355,682	)		(2,184,050	)
Service shares		(1,802,307	)		(1,027,757	)
		(5,157,989	)		(3,211,807	)
Beneficial Interest Transactions
Net decrease in net assets resulting from beneficial interest transactions:
Non-Service shares		(20,174,392	)		(25,243,141	)
Service shares		(10,697,145	)		(8,416,068	)
		(30,871,537	)		(33,659,209	)
Net Assets
Total decrease		(34,267,736	)		(8,341,513	)
Beginning of period		240,201,797			248,543,310
End of period (including accumulated net investment income of $3,885,373 and $5,128,069, respectively)	$	205,934,061		$	240,201,797

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

24 |  OPPENHEIMER BALANCED FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	11.47		$	10.30		$	8.45		$	16.41		$	17.69
Income (loss) from investment operations:
Net investment income2		.20			.23			.25			.41			.43
Net realized and unrealized gain (loss)		(.11	)		1.09			1.60			(7.03	)		.19
Total from investment operations		.09			1.32			1.85			(6.62	)		.62
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.26	)		(.15	)		—			(.39	)		(.46	)
Distributions from net realized gain		—			—			—			(.95	)		(1.44	)
Total dividends and/or distributions to shareholders		(.26	)		(.15	)		—			(1.34	)		(1.90	)
Net asset value, end of period	$	11.30		$	11.47		$	10.30		$	8.45		$	16.41
Total Return, at Net Asset Value3		0.72	%		12.91	%		21.89	%		(43.47	)%		3.79	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	128,383		$	150,622		$	159,797		$	169,621		$	385,948
Average net assets (in thousands)	$	141,848		$	151,620		$	159,013		$	295,669		$	418,103
Ratios to average net assets:4
Net investment income		1.70	%		2.13	%		2.71	%		3.14	%		2.55	%
Total expenses5		0.91	%		0.91	%		0.89	%		0.76	%		0.75	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.67	%		0.65	%		0.60	%		0.67	%		0.73	%
Portfolio turnover rate6		102	%		54	%		87	%		67	%		68	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.93	%
Year Ended December 31, 2010	0.92	%
Year Ended December 31, 2009	0.91	%
Year Ended December 31, 2008	0.76	%
Year Ended December 31, 2007	0.75	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	450,804,195	$	453,759,282
Year Ended December 31, 2010	$	412,930,431	$	414,511,903
Year Ended December 31, 2009	$	504,698,365	$	520,212,670
Year Ended December 31, 2008	$	474,582,075	$	434,587,487
Year Ended December 31, 2007	$	296,201,319	$	315,527,720

See accompanying Notes to Financial Statements.

25 |  OPPENHEIMER BALANCED FUND/VA

FINANCIAL HIGHLIGHTS Continued

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	11.35		$	10.19		$	8.38		$	16.28		$	17.57
Income (loss) from investment operations:
Net investment income2		.16			.20			.22			.37			.38
Net realized and unrealized gain (loss)		(.11	)		1.08			1.59			(6.97	)		.19
Total from investment operations		.05			1.28			1.81			(6.60	)		.57
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.23	)		(.12	)		—			(.35	)		(.42	)
Distributions from net realized gain		—			—			—			(.95	)		(1.44	)
Total dividends and/or distributions to shareholders		(.23	)		(.12	)		—			(1.30	)		(1.86	)
Net asset value, end of period	$	11.17		$	11.35		$	10.19		$	8.38		$	16.28
Total Return, at Net Asset Value3		0.38	%		12.68	%		21.60	%		(43.62	)%		3.49	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	77,551		$	89,580		$	88,746		$	68,798		$	121,399
Average net assets (in thousands)	$	85,157		$	87,280		$	77,101		$	100,164		$	117,012
Ratios to average net assets:4
Net investment income		1.45	%		1.87	%		2.42	%		2.90	%		2.30	%
Total expenses5		1.16	%		1.16	%		1.15	%		1.01	%		1.00	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.92	%		0.90	%		0.85	%		0.92	%		0.98	%
Portfolio turnover rate6		102	%		54	%		87	%		67	%		68	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.18	%
Year Ended December 31, 2010	1.17	%
Year Ended December 31, 2009	1.17	%
Year Ended December 31, 2008	1.01	%
Year Ended December 31, 2007	1.00	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	450,804,195	$	453,759,282
Year Ended December 31, 2010	$	412,930,431	$	414,511,903
Year Ended December 31, 2009	$	504,698,365	$	520,212,670
Year Ended December 31, 2008	$	474,582,075	$	434,587,487
Year Ended December 31, 2007	$	296,201,319	$	315,527,720

See accompanying Notes to Financial Statements.

26 |  OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Balanced Fund/VA (the “Fund”), is a separate series of Oppenheimer Variable Account Funds, an open end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek high total investment return, which includes current income and capital appreciation. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

27 | OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Forward foreign currency exchange contracts are valued utilizing current and forward currency rates obtained from independent pricing services.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Securities on a When-Issued or Delayed Delivery Basis. The Fund may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis normally takes place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of the Fund’s net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. When the Fund engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain or dispose of the security at a price and yield it considers advantageous. The Fund may also sell securities that it purchased on a when-issued basis or forward commitment prior to settlement of the original purchase.

As of December 30, 2011, the Fund had purchased securities issued on a when-issued or delayed delivery basis and sold securities issued on a delayed delivery basis as follows:

	When-Issued or Delayed Delivery
	Basis Transactions
Purchased securities		$34,608,626
Sold securities		834,575

The Fund may enter into “forward roll” transactions with respect to mortgage-related securities. In this type of transaction, the Fund sells a mortgage-related security to a buyer and simultaneously agrees to repurchase a similar security (same type, coupon and maturity) at a later date at a set price. During the period between the sale and the repurchase, the Fund will not be entitled to receive interest and principal payments on the securities that have been sold. The Fund records the incremental difference between the forward purchase and sale of each forward roll as realized gain (loss) on investments or as fee income in the case of such transactions that have an associated fee in lieu of a difference in the forward purchase and sale price.

28 | OPPENHEIMER BALANCED FUND/VA

     Forward roll transactions may be deemed to entail embedded leverage since the Fund purchases mortgage-related securities with extended settlement dates rather than paying for the securities under a normal settlement cycle. This embedded leverage increases the Fund’s market value of investments relative to its net assets which can incrementally increase the volatility of the Fund’s performance. Forward roll transactions can be replicated over multiple settlement periods.

     Risks of entering into forward roll transactions include the potential inability of the counterparty to meet the terms of the agreement; the potential of the Fund to receive inferior securities at redelivery as compared to the securities sold to the counterparty; and counterparty credit risk.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

29 | OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

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

					Net Unrealized
					Appreciation
					Based on Cost of
					Securities and
Undistributed	Undistributed		Accumulated		Other Investments
Net Investment	Long-Term		Loss		for Federal Income
Income	Gain		Carryforward1,2,3,4		Tax Purposes
$3,890,265		$—		$64,721,622		$5,355,887

1. As of December 30, 2011, the Fund had $58,137,466 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2016	$	13,408,759
2017		44,728,707
Total	$	58,137,466

2.	As of December 30, 2011, the Fund had $6,584,156 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund utilized $15,143,099 of capital loss carryforward to offset capital gains realized in that fiscal year.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $15,850,248 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

Increase to	Increase to
Accumulated	Accumulated
Net Investment	Net Realized Loss
Income	on Investments
$272,137		$272,137

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income		$5,157,989		$3,211,807

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	232,371,885
Federal tax cost of other investments		(5,355,361	)
Total federal tax cost	$	227,016,524
Gross unrealized appreciation	$	8,427,376
Gross unrealized depreciation		(3,071,489	)
Net unrealized appreciation	$	5,355,887

30 | OPPENHEIMER BALANCED FUND/VA

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

31 | OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

2. Shares of Beneficial Interest Continued

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		252,001		$	2,909,335			272,126		$	2,909,287
Dividends and/or distributions reinvested		287,056			3,355,682			209,000			2,184,050
Redeemed		(2,302,830	)		(26,439,409	)		(2,866,355	)		(30,336,478	)
Net decrease		(1,763,773	)	$	(20,174,392	)		(2,385,229	)	$	(25,243,141	)
Service Shares
Sold		423,625		$	4,837,026			627,983		$	6,716,376
Dividends and/or distributions reinvested		155,505			1,802,307			99,204			1,027,757
Redeemed		(1,531,184	)		(17,336,478	)		(1,542,514	)		(16,160,201	)
Net decrease		(952,054	)	$	(10,697,145	)		(815,327	)	$	(8,416,068	)

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	175,187,163	$	188,834,785
U.S. government and government agency obligations		737,646		771,994
To Be Announced (TBA) mortgage-related securities		450,804,195		453,759,282

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $229,756 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

32 | OPPENHEIMER BALANCED FUND/VA

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to waive a portion of the advisory fee and/or reimburse certain expenses so that the “Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses” will not exceed 0.67% of average annual net assets for Non-Service shares and 0.92% of average annual net assets for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $312,513 and $187,740 for Non-Service and Service shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $45,249 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

33 | OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

Valuations of derivative instruments as of December 30, 2011 are as follows:

	Asset Derivatives				Liability Derivatives
Derivatives Not Accounted for	Statement of Assets and				Statement of Assets and
as Hedging Instruments	Liabilities Location	Value			Liabilities Location	Value
Interest rate contracts	Futures margins	$	18,316	*	Futures margins	$	11,188	*
Foreign exchange contracts	Unrealized depreciation on foreign currency exchange contracts		28,920		Unrealized appreciation on foreign currency exchange contracts		8,731
Total		$	47,236			$	19,919

* Includes only the current day’s variation margin. Prior variation margin movements have been reflected in cash on the Statement of Assets and Liabilities upon receipt or payment.

34 | OPPENHEIMER BALANCED FUND/VA

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not	Closing and
Accounted for as	expiration of futures		Foreign currency
Hedging Instruments	contracts		transactions			Total
Foreign exchange contracts	$	—	$	(4,185	)	$	(4,185	)
Interest rate contracts		1,402,952		—			1,402,952
Total	$	1,402,952	$	(4,185	)	$	1,398,767

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
Derivatives Not			Translation of assets and
Accounted for as			liabilities denominated in
Hedging Instruments	Futures contracts		foreign currencies		Total
Foreign exchange contracts	$	—	$	20,189	$	20,189
Interest rate contracts		50,474		—		50,474
Total	$	50,474	$	20,189	$	70,663

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions, respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $13,905 and $21,677, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

Futures Contracts

A futures contract is a commitment to buy or sell a specific amount of a financial instrument, or currency, at a negotiated price on a stipulated future date. The Fund may buy and sell futures contracts and may also buy or write put or call options on these futures contracts.

     Futures contracts traded on a commodities or futures exchange will be valued at the final settlement price or official closing price on the principal exchange as reported by such principal exchange at its trading session ending at, or most recently prior to, the time when the Fund’s assets are valued.

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

35 | OPPENHEIMER BALANCED FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

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

     The Fund has purchased futures contracts on various bonds and notes to increase exposure to interest rate risk.

     The Fund has sold futures contracts on various bonds and notes to decrease exposure to interest rate risk.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $8,387,118 and $14,904,462 on futures contracts purchased and sold, respectively.

     Additional associated risks of entering into futures contracts (and related options) include the possibility that there may be an illiquid market where the Fund is unable to liquidate the contract or enter into an offsetting position and, if used for hedging purposes, the risk that the price of the contract will correlate imperfectly with the prices of the Fund’s securities.

6. Restricted Securities

As of December 30, 2011, investments in securities included issues that are restricted. A restricted security may have a contractual restriction on its resale and is valued under methods approved by the Board of Trustees as reflecting fair value. Securities that are restricted are marked with an applicable footnote on the Statement of Investments. Restricted securities are reported on a schedule following the Statement of Investments.

7. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

36 | OPPENHEIMER BALANCED FUND/VA

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

37 | OPPENHEIMER BALANCED FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Balanced Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Balanced Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Balanced Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver,Colorado
February 16, 2012

38 | OPPENHEIMER BALANCED FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 26.69% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

39 | OPPENHEIMER BALANCED FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Mitch Williams, Krishna Memani, and Peter Strzalkowski, the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other mixed-asset target allocation moderate

40 | OPPENHEIMER BALANCED FUND/VA

funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-year Lipper period, although it underperformed its performance universe median during the three-, five-, and ten-year periods. The Board noted the appointment on April 1, 2009 of a new portfolio manager for the Fund and of the head of the Investment Grade Fixed Income Team to oversee the Fund’s investments. The Board also noted that the Fund performed in the second quintile of its performance universe for the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other mixed-asset target allocation moderate funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were lower than its expense group median. The Board also considered that the Manager has voluntarily agreed to waive a portion of the management fee so that total annual fund operating expenses will not exceed 0.67% of average annual net assets for Non-Service shares and 0.92% of average annual net assets for Service shares. This voluntary expense limitation may not be amended or withdrawn until one year after the date of the prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

41 | OPPENHEIMER BALANCED FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

42 | OPPENHEIMER BALANCED FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First

43 | OPPENHEIMER BALANCED FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization)(since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005- March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004- August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President

44 | OPPENHEIMER BALANCED FUND/VA

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
William F. Glavin, Jr., Continued	(June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Memani, Strzalkowski, Williams, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Krishna Memani, Vice President (since 2009) Age: 51	Director of Fixed Income (since October 2010), Senior Vice President and Head of the Investment Grade Fixed Income Team of the Manager (since March 2009). Prior to joining the Manager, Managing Director and Head of the U.S. and European Credit Analyst Team at Deutsche Bank Securities (June 2006-January 2009); Chief Credit Strategist at Credit Suisse Securities (August 2002-March 2006); a Managing Director and Senior Portfolio Manager at Putnam Investments (September 1998-June 2002). A portfolio manager and an officer of 22 portfolios in the OppenheimerFunds complex.
Peter A. Strzalkowski, Vice President (since 2009) Age: 46	Vice President of the Manager (since August 2007), a Chartered Financial Analyst and a member of the Manager’s Investment Grade Fixed Income Team (since April 2009). Prior to joining the Manager, Managing Partner and Chief Investment Officer of Vector Capital Management, LLC, a structured products money management firm he founded, (July 2006-August 2007); a Senior Portfolio Manager at Highland Capital Management, L.P. (June 2005-July 2006) and a Senior Fixed Income Portfolio Manager at Microsoft Corp. (June 2003-June 2005); a Vice President and Senior Fixed Income Portfolio Manager at First Citizens Bank Trust, Capital Management Group (April 2000-June 2003); a Vice President and Fixed Income Portfolio Manager at Centura Banks (November 1998-April 2000). A portfolio manager and officer of 7 portfolios in the OppenheimerFunds complex.
Mitch Williams, Vice President (since 2011) Age: 43	Vice President of the Manager (since July 2006); a Chartered Financial Analyst and a Senior Research Analyst of the Manager (since April 2002). Prior to joining the manager, Vice President and Research Analyst for Evergreen Funds (October 2000-January 2002). A portfolio manager and officer of 6 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.

45 | OPPENHEIMER BALANCED FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Position(s) Held with the Fund, Length of Service, Age

Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen

Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52

Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

46 | OPPENHEIMER BALANCED FUND/VA

OPPENHEIMER BALANCED FUND/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered	KPMG LLP
Public Accounting Firm
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011

Oppenheimer

Capital Appreciation

Annual Report

Fund/VA

A Series of Oppenheimer Variable Account Funds

ANNUAL REPORT

Listing of Top Holdings Fund Performance Discussion Financial Statements

1234

OPPENHEIMER CAPITAL APPRECIATION FUND/VA

Portfolio Manager: Julie Van Cleave, CFA

Average Annual Total Returns
For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		–1.15	%		–0.56	%		1.23	%
Service Shares		–1.37	%		–0.81	%		0.97	%

Expense Ratios
For the Fiscal Year Ended 12/30/11¹

Non-Service Shares	0.80	%
Service Shares	1.05

The performance data quoted represents past performance, which does not guarantee future results.

The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

Sector Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of common stocks.

Top Ten Common Stock Holdings
Apple, Inc.	6.5	%
QUALCOMM, Inc.	4.6
Google, Inc., Cl. A	3.4
McDonald’s Corp.	2.4
Oracle Corp.	2.1
Allergan, Inc.	2.1
Union Pacific Corp.	2.1
Costco Wholesale Corp.	2.0
Occidental Petroleum Corp.	1.9
Coca-Cola Co. (The)	1.9

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of -1.15% for the reporting period ended December 30, 2011.1 On a relative basis, the Fund underperformed the Russell 1000 Growth Index (the “Index”), which returned 2.64% and the S&P 500 Index, which returned 2.11%. The bulk of the Fund’s declines occurred over the third quarter of 2011, when the U.S. equity market experienced significant volatility. The Fund underperformed the Index primarily in the energy sector due to stock selection. The Fund outperformed versus the Index primarily in consumer discretionary.

Economic and Market Overview

The reporting period began with a sense of market optimism over improving Gross Domestic Product (“GDP”) growth in Europe and the U.S., and equity markets in those regions overall experienced solid gains through the first four months of 2011. After strong gains in 2010, most developing market equities started the year off lagging their developed market counterparts due to concerns over slowing growth and rising inflation.

     Market volatility across global equity markets grew over the second quarter of 2011 when Greece again teetered on the brink of defaulting on its sovereign debt, rekindling worries that fiscal instability might spread to other parts of Europe. Concerns over the economic problems in other European countries intensified as did a sense of unease over the health of the European banking system. A natural disaster in Japan caused disruptions in supply chains in the information technology sector and the automotive industry. Previously high-flying economies such as Brazil, Australia and India saw their GDP numbers cool off significantly as they struggled to keep their economies from heading into recession. In the U.S., the Fed’s latest round of quantitative easing, labeled “QE2”, officially ended on June 30, adding to questions around what the Fed’s next move might be to help stimulate the U.S. economy. These developments, in addition to persistently high levels of U.S. unemployment and a depressed U.S. housing market, contributed to a weaker-than-expected estimate of U.S. GDP during the second quarter of the year.

     Due to the sluggish economy and lowered expectations for future economic growth, global equities began a decline over the summer that intensified as the third quarter progressed. The markets priced in a renewed sense of pessimism that Europe might succumb to a double-dip recession and that the U.S. was headed for a prolonged period of disappointing growth. Uncertainty and market nervousness grew as a deal to raise the U.S. debt ceiling was not reached until shortly before the deadline. As a result of the intense political wrangling, the credit rating agency Standard & Poor’s took the unprecedented and controversial step of downgrading the debt of the U.S., a decision that the two other major U.S. credit rating agencies opted not to follow. These events, coupled with the high likelihood of a Greek default on its debt and worries that Italy might be next, sent stocks sharply lower over the third quarter of 2011.

     In the fourth quarter, equity markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Top Individual Contributors

The top contributor to overall performance was information technology holding Apple, Inc., which was also the top holding of the Fund at period end. Apple continued to out-execute its peers. The company’s continued success at innovation and highly recognizable brand led to global growth and share gains across its top revenue producing products—iPhones, iPads and Mac PCs. QUALCOMM, Inc., the Fund’s second largest holding at period end, was another information technology stock that contributed positively to Fund performance. During the period, QUALCOMM experienced strong sales and completed its acquisition of Atheros Communications, Inc., which is a developer of wireless connectivity chips such as WiFi. QUALCOMM also began to benefit from share gains in smartphones, by becoming a leading supplier to market leader Apple, Inc.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FUND PERFORMANCE DISCUSSION

     Outside of the information technology sector, aerospace and defense company Goodrich Corp. produced positive results for the Fund. During the period, United Technologies Corp. announced that it planned to purchase Goodrich for $127.50 per share. The market reacted positively to this news, sending Goodrich’s stock price higher. Within the consumer discretionary sector, fast food chain McDonald’s Corp. posted solid results, as it benefited from the popularity of its McCafe beverage line-up, breakfasts and its premium chicken sandwiches.

     The Fund also received positive results from pharmaceutical holdings Bristol-Myers Squibb Co. and Allergan, Inc. Bristol-Myers Squibb, which produces such drugs as Plavix and Abilify, benefited from recent trial results for Eliquis, an anticoagulant that showed “best in class” data for both stroke and major bleeding against the existing drug Warfarin, while also showing a statistically significant reduction in mortality. Additionally, a competing drug from Johnson & Johnson/Bayer, which is currently in trials, experienced a setback from the Food and Drug Administration (FDA). Multi-specialty health care company Allergan continued to benefit from sales of Botox.

Top Individual Detractors

During the reporting period, information technology stocks Juniper Networks, Inc. and Broadcom Corp. detracted from Fund performance. During the period, Juniper Networks was impacted by slowing capital expenditure trends at telecommunications services companies who were paralyzed by the weakening global economy and European uncertainty. Semiconductor firm Broadcom had a difficult reporting period, as the semiconductor industry generally did not fare well given the difficult economic environment and lack of new investment. In telecommunication services, NII Holdings, Inc. detracted from performance. NII Holdings’ stock declined over the last quarter of 2011 after reporting a third-quarter loss and a lowered revenue outlook for 2011. We exited our position by period end.

     Energy holding Baker Hughes, Inc. and health care stock Illumina, Inc. detracted from Fund results given the significant market volatility over the second half of 2011. Baker Hughes is the world’s third largest oilfield services company delivering focused efforts on shale gas and other oilfield services. The Fund’s investment in Baker Hughes was negatively impacted by a sell-off in energy stocks in the third quarter of 2011 as crude oil prices declined amid concerns that an economic slowdown could dampen demand. Biotech firm Illumina fell sharply after it warned it would miss third quarter revenue forecasts and withdraw its full-year estimate. While biotech stocks overall performed poorly for the period, Illumina’s stock fell further than most after it expressed a negative outlook for research funding in the U.S. and Europe and a drop in demand for the company’s Genome Analyzer equipment. We exited our position by period end.

Outlook

Weak GDP numbers in multiple regions of the globe have raised questions around whether the fragile global economic recovery has reversed course and begun a slide back into recession. Concerns exist that slow or negative growth will negatively impact consumer sentiment and spending habits, leading to further weakness in the global economy and the markets. The markets are pricing in a great deal of uncertainty, whether that uncertainty lies with the outcomes of the debates in the U.S. Congress over debt reduction or the political upheavals across much of Europe. Improving unemployment figures in the U.S. offer some degree of optimism for the U.S economy. Measures being undertaken in Europe to shore up the euro and the Eurozone may help to stem in 2012 some of the significant market volatility we saw in 2011.

     Despite the market volatility we have witnessed of late, we remain confident in our investment approach. We will continue to search for companies that, in our view, offer strong earnings prospects and are trading at attractive valuations. We believe that moments like these can lead to significant investment opportunities where solid companies are undervalued and which we can purchase at an attractive price. While current global political and economic conditions are causing significant market fluctuations, we have not changed our long-term approach to investing and believe that reacting strongly to short-term market gyrations is rarely warranted or a prudent investment strategy.

4 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. Performance is measured over a ten-fiscal-year period for both Classes. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the S&P 500 Index, an unmanaged index of large-capitalization equity securities that is a measure of the general domestic stock market, and the Russell 1000 Growth Index, an unmanaged index of 1,000 U.S. large cap growth stocks. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the indices.

5 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Oppenheimer Capital Appreciation Fund/VA (Non-Service) S&P 500 Index Russell 1000 Growth Index

Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Oppenheimer Capital Appreciation Fund/VA (Service) S&P 500 Index Russell 1000 Growth Index

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1.  December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	937.30	$	3.84
Service shares		1,000.00		936.30		5.06
Hypothetical (5% return before expenses)
Non-Service shares		1,000.00		1,021.11		4.01
Service shares		1,000.00		1,019.85		5.28

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.79	%
Service shares		1.04

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—99.0%
Consumer Discretionary—15.4%
Auto Components—1.1%
Johnson Controls, Inc.		345,170	$	10,790,014
Hotels, Restaurants & Leisure—3.3%
McDonald’s Corp.		240,060		24,085,220
Yum! Brands, Inc.		161,580		9,534,836
				33,620,056
Internet & Catalog Retail—1.4%
Amazon.com, Inc.1		80,064		13,859,078
Media—1.6%
Walt Disney Co. (The)		420,360		15,763,500
Specialty Retail—4.2%
Bed Bath & Beyond, Inc.1		77,280		4,479,922
O’Reilly Automotive, Inc.1		198,330		15,856,484
Tiffany & Co.		153,330		10,159,646
TJX Cos., Inc. (The)		194,880		12,579,504
				43,075,556
Textiles, Apparel & Luxury Goods—3.8%
Coach, Inc.		214,130		13,070,495
Nike, Inc., Cl. B		159,740		15,394,144
Ralph Lauren Corp.		73,590		10,161,307
				38,625,946
Consumer Staples—11.7%
Beverages—4.0%
Brown-Forman Corp., Cl. B		104,700		8,429,397
Coca-Cola Co. (The)		270,190		18,905,194
SABMiller plc		377,520		13,234,908
				40,569,499
Food & Staples Retailing—2.0%
Costco Wholesale Corp.		239,690		19,970,971
Food Products—3.1%
Mead Johnson Nutrition Co., Cl. A		57,800		3,972,594
Nestle SA		271,734		15,621,884
Unilever NV CVA		338,928		11,655,105
				31,249,583
Household Products—1.5%
Colgate-Palmolive Co.		169,090		15,622,225
Personal Products—0.6%
Estee Lauder Cos., Inc. (The), Cl. A		54,320		6,101,222
Tobacco—0.5%
Philip Morris International, Inc.		64,880		5,091,782
Energy—11.3%
Energy Equipment & Services—5.3%
Baker Hughes, Inc.		193,570		9,415,245
Cameron International Corp.1		208,180		10,240,374
Ensco plc, Sponsored ADR		148,610		6,972,781
National Oilwell Varco, Inc.		168,250		11,439,318
Schlumberger Ltd.		236,260		16,138,921
				54,206,639
Oil, Gas & Consumable Fuels—6.0%
Apache Corp.		100,230		9,078,833
Chevron Corp.		171,580		18,256,112
ConocoPhillips		187,230		13,643,450
Occidental Petroleum Corp.		206,680		19,365,916
				60,344,311
Financials—1.8%
Capital Markets—0.2%
Charles Schwab Corp. (The)		181,470		2,043,352
Commercial Banks—0.6%
Standard Chartered plc		264,590		5,760,745
Consumer Finance—1.0%
American Express Co.		219,650		10,360,891
Health Care—12.1%
Biotechnology—2.1%
Alexion Pharmaceuticals, Inc.1		67,730		4,842,695
Celgene Corp.1		130,230		8,803,548
Vertex Pharmaceuticals, Inc.1		229,680		7,627,673
				21,273,916
Health Care Equipment & Supplies—1.3%
Baxter International, Inc.		266,400		13,181,472
Life Sciences Tools & Services—1.7%
Mettler-Toledo International, Inc.1		49,000		7,237,790
Thermo Fisher Scientific, Inc.1		224,650		10,102,511
				17,340,301
Pharmaceuticals—7.0%
Allergan, Inc.		245,170		21,511,216
Bristol-Myers Squibb Co.		499,230		17,592,865
Novo Nordisk AS, Cl. B		152,384		17,511,438
Roche Holding AG		83,549		14,160,546
				70,776,065
Industrials—15.0%
Aerospace & Defense—3.4%
Goodrich Corp.		78,122		9,663,691
Precision Castparts Corp.		71,670		11,810,499
United Technologies Corp.		174,990		12,790,019
				34,264,209

8 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

	Shares			Value
Air Freight & Logistics—1.4%
United Parcel Service, Inc., Cl. B		192,050		$	14,056,140
Electrical Equipment—1.3%
Emerson Electric Co.		278,810			12,989,758
Industrial Conglomerates—1.5%
Danaher Corp.		332,420			15,637,037
Machinery—5.3%
Caterpillar, Inc.		151,360			13,713,216
Cummins, Inc.		43,420			3,821,828
Deere & Co.		93,600			7,239,960
Joy Global, Inc.		181,857			13,633,819
Parker-Hannifin Corp.		202,230			15,420,038
					53,828,861
Road & Rail—2.1%
Union Pacific Corp.		196,220			20,787,547
Information Technology—26.4%
Communications Equipment—5.2%
Juniper Networks, Inc.1		305,190			6,228,928
QUALCOMM, Inc.		843,470			46,137,809
					52,366,737
Computers & Peripherals—6.5%
Apple, Inc.1		162,590			65,848,950
Electronic Equipment & Instruments—1.0%
Corning, Inc.		828,440			10,753,151
Internet Software & Services—4.8%
eBay, Inc.1		473,620			14,364,895
Google, Inc., Cl. A1		52,670			34,019,553
					48,384,448
IT Services—2.7%
International Business Machines Corp.		86,300			15,868,844
Visa, Inc., Cl. A		113,257			11,498,983
					27,367,827
Semiconductors & Semiconductor
Equipment—1.1%
Broadcom Corp., Cl. A		395,580			11,614,229
Software—5.1%
Intuit, Inc.		300,400			15,798,036
Oracle Corp.		845,390			21,684,254
Vmware, Inc., Cl. A1		167,190			13,908,536
					51,390,826
Materials—5.3%
Chemicals—3.7%
Albemarle Corp.		82,010			4,224,335
Ecolab, Inc.		197,680			11,427,881
Mosaic Co. (The)		77,660			3,916,394
Praxair, Inc.		173,052			18,499,259
					38,067,869
Metals & Mining—1.6%
Freeport-McMoRan Copper & Gold, Inc., Cl. B		281,190			10,344,980
Rio Tinto plc		113,948			5,529,995
					15,874,975
Total Common Stocks (Cost $735,719,310)					1,002,859,688
Investment Company—0.8%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%2,3 (Cost $8,136,365)		8,136,365			8,136,365
Total Investments, at Value (Cost $743,855,675)		99.8	%		1,010,996,053
Other Assets Net of Liabilities		0.2			2,202,155
Net Assets		100.0	%	$	1,013,198,208

9 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Nore 1 of the accompanying Note.
1.	Non-income producing security.
2.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		72,534		147,246,660		139,182,829		8,136,365

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	8,136,365	$	7,315

3. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3—
	Level 1—		Level 2—		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	155,734,150	$	—	$	—	$	155,734,150
Consumer Staples		105,370,374		13,234,908		—		118,605,282
Energy		114,550,950		—		—		114,550,950
Financials		12,404,243		5,760,745		—		18,164,988
Health Care		122,571,754		—		—		122,571,754
Industrials		151,563,552		—		—		151,563,552
Information Technology		267,726,168		—		—		267,726,168
Materials		53,942,844		—		—		53,942,844
Investment Company		8,136,365		—		—		8,136,365
Total Assets	$	992,000,400	$	18,995,653	$	—	$	1,010,996,053

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

10 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $735,719,310)	$	1,002,859,688
Affiliated companies (cost $8,136,365)		8,136,365
		1,010,996,053
Cash		2,683
Receivables and other assets:
Dividends		2,875,070
Shares of beneficial interest sold		276,097
Other		101,548
Total assets		1,014,251,451
Liabilities
Payables and other liabilities:
Shares of beneficial interest redeemed		607,498
Shareholder communications		213,049
Transfer and shareholder servicing agent fees		86,922
Distribution and service plan fees		71,553
Trustees’ compensation		39,042
Legal, auditing and other professional fees		26,000
Other		9,179
Total liabilities		1,053,243
Net Assets	$	1,013,198,208
Composition of Net Assets
Par value of shares of beneficial interest	$	25,573
Additional paid-in capital		1,040,394,286
Accumulated net investment income		3,993,822
Accumulated net realized loss on investments and foreign currency transactions		(298,600,481	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		267,385,008
Net Assets	$	1,013,198,208
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $637,868,461 and 16,045,913 shares of beneficial interest outstanding)	$	39.75
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $375,329,747 and 9,526,732 shares of beneficial interest outstanding)	$	39.40

^1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

11 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $298,519)	$	15,258,739
Affiliated companies		7,315
Interest		716
Total investment income		15,266,770
Expenses
Management fees		7,570,152
Distribution and service plan fees—Service shares		1,018,862
Transfer and shareholder servicing agent fees:
Non-Service shares		714,086
Service shares		407,595
Shareholder communications:
Non-Service shares		104,964
Service shares		59,333
Trustees’ compensation		52,240
Custodian fees and expenses		33,816
Administration service fees		1,500
Other		73,144
Total expenses		10,035,692
Less waivers and reimbursements of expenses		(91,612	)
Net expenses		9,944,080
Net Investment Income		5,322,690
Realized and Unrealized Gain (Loss)
Net realized gain on:
Investments from unaffiliated companies		51,490,189
Foreign currency transactions		7,557,246
Net realized gain		59,047,435
Net change in unrealized appreciation/depreciation on:
Investments		(66,910,317	)
Translation of assets and liabilities denominated in foreign currencies		(7,021,334	)
Net change in unrealized appreciation/depreciation		(73,931,651	)
Net Decrease in Net Assets Resulting from Operations	$	(9,561,526	)

^1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

12 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	5,322,690		$	3,239,641
Net realized gain		59,047,435			159,280,200
Net change in unrealized appreciation/depreciation		(73,931,651	)		(38,941,658	)
Net increase (decrease) in net assets resulting from operations		(9,561,526	)		123,578,183
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(2,685,368	)		(1,796,034	)
Service shares		(448,818	)		—
		(3,134,186	)		(1,796,034	)
Beneficial Interest Transactions
Net decrease in net assets resulting from beneficial interest transactions:
Non-Service shares		(125,913,455	)		(385,079,054	)
Service shares		(43,268,026	)		(59,987,624	)
		(169,181,481	)		(445,066,678	)
Net Assets
Total decrease		(181,877,193	)		(323,284,529	)
Beginning of period		1,195,075,401			1,518,359,930
End of period (including accumulated net investment income of $3,993,822 and $1,761,658, respectively)	$	1,013,198,208		$	1,195,075,401

¹ December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

13 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	40.35		$	36.94		$	25.67		$	47.18		$	41.43
Income (loss) from investment operations:
Net investment income2		.23			.11			.09			.10			.07
Net realized and unrealized gain (loss)		(.69	)		3.36			11.27			(21.55	)		5.78
Total from investment operations		(.46	)		3.47			11.36			(21.45	)		5.85
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.14	)		(.06	)		(.09	)		(.06	)		(.10	)
Net asset value, end of period	$	39.75		$	40.35		$	36.94		$	25.67		$	47.18
Total Return, at Net Asset Value3		(1.15	)%		9.42	%		44.52	%		(45.52	)%		14.15	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	637,868		$	771,086		$	1,074,190		$	829,931		$	1,631,791
Average net assets (in thousands)	$	713,770		$	976,242		$	927,670		$	1,256,525		$	1,631,686
Ratios to average net assets:4
Net investment income		0.57	%		0.31	%		0.29	%		0.25	%		0.15	%
Total expenses5		0.80	%		0.79	%		0.78	%		0.66	%		0.65	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.80	%		0.79	%		0.78	%		0.66	%		0.65	%
Portfolio turnover rate		27	%		58	%		46	%		67	%		59	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.80	%
Year Ended December 31, 2010	0.79	%
Year Ended December 31, 2009	0.78	%
Year Ended December 31, 2008	0.66	%
Year Ended December 31, 2007	0.65	%

See accompanying Notes to Financial Statements.

14 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	39.99		$	36.64		$	25.42		$	46.78		$	41.09
Income (loss) from investment operations:
Net investment income (loss)2		.13			.02			.01			—	3		(.05	)
Net realized and unrealized gain (loss)		(.68	)		3.33			11.21			(21.36	)		5.74
Total from investment operations		(.55	)		3.35			11.22			(21.36	)		5.69
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.04	)		—			—	3		—			—	3
Net asset value, end of period	$	39.40		$	39.99		$	36.64		$	25.42		$	46.78
Total Return, at Net Asset Value4		(1.37	)%		9.15	%		44.15	%		(45.66	)%		13.86	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	375,330		$	423,989		$	444,170		$	313,931		$	546,887
Average net assets (in thousands)	$	407,413		$	427,640		$	368,634		$	454,558		$	510,874
Ratios to average net assets:5
Net investment income (loss)		0.32	%		0.06	%		0.03	%		0.00	%6		(0.10	)%
Total expenses7		1.05	%		1.04	%		1.04	%		0.91	%		0.91	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.05	%		1.04	%		1.03	%		0.91	%		0.91	%
Portfolio turnover rate		27	%		58	%		46	%		67	%		59	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Less than $0.005 per share.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.
6.	Less than 0.005%.
7.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.05	%
Year Ended December 31, 2010	1.04	%
Year Ended December 31, 2009	1.04	%
Year Ended December 31, 2008	0.91	%
Year Ended December 31, 2007	0.91	%

See accompanying Notes to Financial Statements.

15 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Capital Appreciation Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek capital appreciation by investing in securities of well-known, established companies. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

16 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

17 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

							Net Unrealized
							Appreciation
							Based on Cost
							of Securities and
Undistributed	Undistributed			Accumulated			Other Investments
Net Investment	Long-Term			Loss			for Federal Income
Income	Gain			Carryforward1,2,3,4			Tax Purposes
$5,355,106		$	—		$	296,790,277		$	265,435,167

1. As of December 30, 2011, the Fund had $289,995,783 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2016	$	109,362,611
2017		180,633,172
Total	$	289,995,783

2.	As of December 30, 2011, the Fund had $6,794,494 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund utilized $62,322,990 of capital loss carryforward to offset capital gains realized in that fiscal year.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $72,900,879 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

Increase	Increase to
to Accumulated	Accumulated Net
Net Investment	Realized Loss
Income	on Investments
$43,660		$	43,660

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended			Year Ended
	December 30, 2011			December 31, 2010
Distributions paid from:
Ordinary income		$	3,134,186		$	1,796,034

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table.

18 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	745,805,516
Gross unrealized appreciation	$	298,208,830
Gross unrealized depreciation		(32,773,663	)
Net unrealized appreciation	$	265,435,167

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the

19 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

1. Significant Accounting Policies Continued

reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		1,249,985		$	50,511,923			2,554,247		$	93,160,063
Dividends and/or distributions reinvested		63,634			2,685,368			48,307			1,796,034
Redeemed		(4,379,711	)		(179,110,746	)		(12,572,941	)		(480,035,151	)
Net decrease		(3,066,092	)	$	(125,913,455	)		(9,970,387	)	$	(385,079,054	)
Service Shares
Sold		696,209		$	28,336,802			1,613,467		$	57,695,403
Dividends and/or distributions reinvested		10,709			448,818			—			—
Redeemed		(1,782,789	)		(72,053,646	)		(3,133,549	)		(117,683,027	)
Net decrease		(1,075,871	)	$	(43,268,026	)		(1,520,082	)	$	(59,987,624	)

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	299,307,755	$	476,954,733

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $1,145,815 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance

20 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $28,772 and $17,036 for Non-Service and Service shares, respectively.

     Effective September 1, 2011, the Manager had voluntarily agreed to reduce its management fee by 0.05% of the Fund’s average daily net assets until the Fund’s trailing one-year total return performance was in the third quintile of the Fund’s Lipper peer group as measured at each calendar quarter end. The management fee reduction would be terminated effective as of the first business day following the achievement of this goal and therefore terminated effective October 1, 2011. During the year ended December 30, 2011, the Manager reimbursed the Fund $41,699.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $4,105 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

21 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

22 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for
as Hedging Instruments	Foreign currency transactions
Foreign exchange contracts		$	65,057

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for	Translation of assets and liabilities
as Hedging Instruments	denominated in foreign currencies
Foreign exchange contracts	$	1,356

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions, respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $318,483 and $449,775, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

     As of December 30, 2011, the Fund had no outstanding forward contracts.

6. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

23 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Pending Litigation Continued

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

24 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Capital Appreciation Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Capital Appreciation Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian and transfer agent. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Capital Appreciation Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

25 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 100% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

26 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio manager and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Julie Van Cleave, the portfolio manager for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other large-cap growth funds underlying variable

27 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued

insurance products. The Board considered that the Fund outperformed its performance universe median during the ten-year Lipper period, although it underperformed its performance universe median during the one-, three-, and five-year periods. The Board considered the Fund’s recent improved performance, ranking in the third quintile for the year to date ended April 30, 2011. The Board noted the recent change in portfolio management to the Fund, effective April 26, 2010.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other large-cap growth funds underlying variable insurance products. Effective September 1, 2011, the Manager has voluntarily agreed to reduce its management fee by 0.05% of the Fund’s average daily net assets until the Fund’s trailing one-year total return performance is in the third quintile of the Fund’s Lipper peer group as measured at each calendar quarter end. The management fee reduction will be terminated effective as of the first business day following the achievement of this goal. The management fee reduction is a voluntary undertaking by the Manager, and the Manager may terminate it at any time. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were higher than its expense group median. The Board also considered that the actual management fees were only two basis points higher than the median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

28 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

29 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000-June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and

30 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999—March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004- August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

31 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

TRUSTEES AND OFFICERS Unaudited/Continued

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Mr. Gabinet, Mss. Van Cleave and Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Julie Van Cleave, Vice President (since 2010) Age: 52	Vice President of the Manager (since April 2010); a Chartered Financial Analyst. Prior to joining the Manager, a Managing Director, U.S. Large-Cap Growth Equity, and lead portfolio manager at Deutsche Asset Management (December 2002-February 2009). Prior to 2002, a Managing Director, a portfolio manager and a team leader with Mason Street Advisors, a wholly owned subsidiary of Northwestern Mutual Life. A portfolio manager and officer of 3 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005- April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

32 | OPPENHEIMER CAPITAL APPRECIATION FUND/VA

OPPENHEIMER CAPITAL APPRECIATION FUND/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011 Oppenheimer Core Bond Fund/VAAnnual Report A Series of Oppenheimer Variable Account Funds A N N UA L R E P O RT Fund Allocations Fund Performance Discussion Financial Statements

OPPENHEIMER CORE BOND FUND/VA

Portfolio Managers: Krishna Memani and
Peter A. Strzalkowski, CFA

Average Annual Total Returns
For the Periods Ended 12/30/111

	1-Year	5-Year	10-Year
Non-Service Shares	8.27%	-3.40%	1.11%

	1-Year	5-Year	Since Inception (5/1/02)
Service Shares	7.93%	-3.64%	0.80%

Expense Ratios
For the Period Ended 12/30/11¹

	Gross			Net
	Expense			Expense
	Ratios2			Ratios2
Non-Service Shares		0.79	%		0.77	%
Service Shares		1.04			1.02

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

1.	December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements.
2.	These Expense Ratios include the applicable indirect expenses attributable to the Fund’s investments in other investment companies.

Corporate Bonds & Notes — Top Ten Industries
Oil, Gas & Consumable Fuels	4.3	%
Insurance	3.4
Capital Markets	3.0
Media	2.9
Commercial Banks	2.4
Electric Utilities	2.3
Diversified Financial Services	2.3
Diversified Telecommunication Services	1.6
Metals & Mining	1.5
Energy Equipment & Services	1.5

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

Credit Rating Breakdown	NRSRO Only Total
AAA		63.1	%
AA		1.5
A		9.8
BBB		17.0
BB		5.5
B		0.6
CCC		2.3
CC		0.0	*
D		0.2
Total		100.0	%

* Represents a value of less than 0.05%.

The percentages above are based on the market value of the Fund’s securities as of December 30, 2011, and are subject to change. Except for certain securities issued or guaranteed by a sovereign or supranational entity, all securities have been rated by at least one Nationally Recognized Statistical Rating Organization (“NRSRO”), such as Standard & Poor’s (“S&P”). For securities rated only by an NRSRO other than S&P, OppenheimerFunds, Inc. converts that rating to the equivalent S&P rating. If two or more NRSROs have assigned a rating to a security, the highest S&P equivalent rating is used. Unrated securities issued or guaranteed by a sovereign entity are assigned a credit rating equal to the highest NRSRO rating assigned to that sovereign entity. U.S. Government “Treasury” and “Agency” securities are included in the AAA category. Fund assets invested in Oppenheimer Institutional Money Market Fund are assigned that fund’s S&P rating, which is currently AAA. For the purposes of this Credit Allocation table, “investment-grade” securities are securities rated within the NRSROs’ four highest rating categories, which include AAA, AA, A and BBB. Unrated securities do not necessarily indicate low credit quality, and may or may not be the equivalent of investment-grade. Please consult the Fund’s prospectus for further information. Additional information can be found in the Fund’s Statement of Additional Information.

2 | OPPENHEIMER CORE BOND FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of 8.27% for the reporting period ended December 30, 2011.³ On a relative basis, the Fund outperformed the Barclays Capital U.S. Aggregate Bond Index (the “Index”), which generated a total return of 7.84%. In comparison, the Barclays Capital Credit Index and the Citigroup Broad Investment Grade Bond Index produced total returns of 8.35% and 7.85%, respectively. The Fund’s positive performance occurred in an environment where fixed-income investments, particularly those domiciled in the U.S., generally performed much better relative to global equities.

Economic and Market Overview

The first half of the reporting period was generally characterized by resilience among investors who looked forward to improved credit conditions in a recovering global economy. Even the wave of political unrest in the Middle East in early 2011, which led to sharply higher energy prices, had only a temporary dampening effect on most financial markets. Likewise, markets recovered relatively quickly after a devastating natural disaster and subsequent nuclear energy crisis hit Japan in March, disrupting global industrial supply chains. During this time, equities and higher-yielding fixed income securities generally performed well.

     Investor sentiment began to deteriorate in late April, when U.S. economic data proved disappointing, and a contentious U.S. fiscal policy debate intensified. These concerns reached a tipping point in early August, when the credit rating company Standard & Poor’s downgraded the sovereign debt of the U.S., a decision that the two other major credit rating firms opted not to follow.

     Meanwhile, international uncertainty worsened with the high likelihood that Greece was headed for default on its debt and other members of the European Union continued to struggle with heavy debt burdens, leading to worries over the health of the European banking system. Inflationary pressures mounted in China and other emerging markets, where investors grew concerned that remedial measures, including higher local interest rates, might derail these major engines of global growth. Financial markets also grew concerned that new recessions in the developed markets could mean a slowdown in growth in export dependent emerging economies. Some emerging market countries saw their GDP growth stall after a prolonged period of solid increases.

     These events triggered a flight to quality that boosted traditional safe havens but hurt areas of the market that historically have been considered riskier. Fixed-income investments in emerging markets generally underperformed their developed markets counterparts as a result of shifting investor sentiment. In the United States, long-term U.S. Treasury securities continued to rally even after the credit-rating downgrade, but high yield corporate bonds gave back earlier gains, despite generally healthy balance sheets and limited needs for near term refinancing. Market turbulence throughout the world was particularly severe over the third quarter of 2011 with most global risk markets experiencing sharp declines.

     In the fourth quarter, risk markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Fund Review

During the reporting period, the Fund’s positive performance was driven by its investments in mortgage backed obligations, primarily residential mortgage-backed securities (RMBS). The Fund’s exposure to RMBS included securities guaranteed by government-sponsored enterprises, commonly referred to as agency RMBS, as well as a smaller allocation to RMBS originated by private entities, also known as non-agency RMBS. Commercial mortgage-backed securities (CMBS) and asset backed securities (ABS) also performed well for the Fund. Despite bouts of risk aversion, particularly over the volatile third quarter of 2011, mortgage backed obligations generally produced positive results for the year. The Fund also benefited from an allocation to investment grade and high yield securities for the year.

3. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER CORE BOND FUND/VA

FUND PERFORMANCE DISCUSSION

     In terms of detractors from performance, the Fund’s limited exposure to U.S. Treasuries hurt relative performance versus the Index. Despite Standard & Poor’s downgrade of U.S. sovereign debt, U.S. Treasuries held up well during the year as many investors remained cautious of risk. Our underweight position in agency debt also detracted from relative performance this period.

Outlook

We remain cautiously optimistic at period end. We expect uncertainty in the Eurozone to keep consumer, business and investor anxiety elevated. Yet, we see recent steps taken by Eurozone policymakers to address the crisis as positive; albeit slow and incomplete. In the U.S., concerns remain over slow growth and the ability of elected officials to address the key issues relating to deficits, entitlements and taxation. However, a domestic recession seems unlikely given recent upside surprises and the possibility of QE3 as 2012 progresses.

     Despite these ongoing concerns, we believe the continued high level of risk aversion could mean bond markets have priced in most negative outcomes. This could be beneficial to riskier asset classes in the face of positive, or less negative, headlines. As such, we expect to maintain allocations to domestic credit, ABS, RMBS and CMBS. Corporate profitability continues to advance while defaults for non-investment-grade issuers remain low. We view the wide spreads on credit as an opportunity; yet, this tilt results in underweights to U.S. Treasuries, which may benefit if events trigger a flight to quality in the market. Given the potential risk emanating from Europe, we have a more defensive posture than usual. Overall, the Fund is focused on carry, or additional yield, by seeking to maintain positions that boost income above that of the benchmark. We believe our careful and tactical security selection process can uncover opportunities in 2012.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. In the case of Non-Service shares, performance is measured over a ten-fiscal-year period. In the case of Service shares, performance is measured from inception of the Class on May 1, 2002. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the Citigroup Broad Investment Grade Bond Index, an index of institutionally traded U.S. Treasury Bonds, government-sponsored bonds, mortgage-backed securities and corporate securities; the Barclays Capital U.S. Aggregate Bond Index, an index of U.S. corporate and government bonds, and the Barclays Capital Credit Index, an index of non-convertible U.S. investment grade corporate bonds. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. Indices are unmanaged and cannot be purchased directly by investors. Index performance is shown for illustrative purposes only and does not predict or depict the performance of the Fund. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the indices.

4 | OPPENHEIMER CORE BOND FUND/VA

Non-Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Oppenheimer Core Bond Fund/VA(NonService) Citigroup Broad Investment Grade Bond Index Barclays Capital U.S. Aggregate Bond Index Barclays Capital Credit Index

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

5 | OPPENHEIMER CORE BOND FUND/VA

FUND PERFORMANCE DISCUSSION

Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Oppenheimer Core Bond Fund/VA (Service) Citigroup Broad Investment Grade Bond Index Barclays Capital U.S. Aggregate Bond Index Barclays Capital Credit Index

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER CORE BOND FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	1,042.30	$	3.85
Service shares		1,000.00		1,040.10		5.13
Hypothetical (5% return before expenses)
Non-Service shares		1,000.00		1,021.31		3.81
Service shares		1,000.00		1,020.05		5.08

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.75	%
Service shares		1.00

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Principal
	Amount		Value
Asset-Backed Securities—10.3%
AESOP Funding II LLC, Automobile Receivables Nts., Series 2011-1A, Cl. A, 1.85%, 11/20/131	$	235,000	$	234,471
Ally Auto Receivables Trust 2010-4, Automobile Receivables Nts., Series 2010-4, Cl. A3, 0.91%, 11/17/14		280,000		280,317
Ally Master Owner Trust 2010-3, Asset-Backed Certificates, Series 2010-3, Cl. A, 2.88%, 4/15/151		660,000		671,093
Ally Master Owner Trust, Asset-Backed Nts., Series 2011-1, Cl. A2, 2.15%, 1/15/16		230,000		232,599
Ally Master Owner Trust, Automobile Receivables Nts., Series 2011-4, Cl. A2, 1.54%, 9/15/16		545,000		543,545
AmeriCredit Automobile Receivables Trust 2009-1, Automobile Receivables-Backed Nts., Series 2009-1, Cl. A3, 3.04%, 10/15/13		13,802		13,879
AmeriCredit Automobile Receivables Trust 2010-3, Automobile Receivables-Backed Nts., Series 2010-3, Cl. A2, 0.77%, 12/9/13		195,640		195,618
AmeriCredit Automobile Receivables Trust 2011-1, Automobile Receivables-Backed Nts., Series 2011-1, Cl. D, 4.26%, 2/8/17		120,000		121,541
AmeriCredit Automobile Receivables Trust 2011-2, Automobile Receivables-Backed Nts.:
Series 2011-2, Cl. A3, 1.61%, 10/8/15		140,000		140,607
Series 2011-2, Cl. D, 4%, 5/8/17		235,000		234,683
AmeriCredit Automobile Receivables Trust 2011-4, Automobile Receivables-Backed Nts., Series 2011-4, Cl. D, 4.08%, 7/10/17		650,000		649,027
AmeriCredit Automobile Receivables Trust 2011-5, Automobile Receivables Nts.:
Series 2011-5, Cl. D, 4.72%, 12/8/17		435,000		445,042
Series 2011-5, Cl. D., 1.55%, 7/8/16		360,000		359,921
AmeriCredit Prime Automobile Receivables Trust 2010-2, Automobile Receivables Nts., Series 2010-2, Cl. A2, 1.22%, 10/8/13		35,467		35,483
Argent Securities Trust 2006-M3, Asset-Backed Pass-Through Certificates, Series 2006-M3, Cl. A2B, 0.394%, 9/25/362		19,776		5,814
Carrington Mortgage Loan Trust, Asset-Backed Pass-Through Certificates, Series 2006-FRE1, Cl. A2, 0.404%, 7/25/362		343,755		316,859
Centre Point Funding LLC, Asset-Backed Nts., Series 2010-1A, Cl. 1, 5.43%, 7/20/151		102,238		107,220
Citibank Credit Card Issuance Trust, Credit Card Receivable Nts., Series 2003-C4, Cl. C4, 5%, 6/10/15		310,000		323,323
Citibank Omni Master Trust, Credit Card Receivables:
Series 2009-A13, Cl. A13, 5.35%, 8/15/181		915,000		1,000,157
Series 2009-A17, Cl. A17, 4.90%, 11/15/181		725,000		789,121
Series 2009-A8, Cl. A8, 2.378%, 5/16/161,2		620,000		623,866
CNH Wholesale Master Note Trust 2011-1, Equipment Nts., Series 2011-1, Cl. 1A, 1.078%, 1/20/412		465,000		465,563
Countrywide Home Loans, Asset-Backed Certificates:
Series 2002-4, Cl. A1, 1.034%, 2/25/332		15,723		15,101
Series 2005-16, Cl. 2AF2, 5.377%, 5/1/362		432,896		332,575
CWABS Asset-Backed Certificates Trust 2006-25, Asset-Backed Certificates, Series 2006-25, Cl. 2A2, 0.414%, 6/25/472		35,693		31,561
DSC Floorplan Master Owner Trust, Automobile Receivable Nts., Series 2011-1, Cl. A, 3.91%, 3/15/16		400,000		405,419
DT Auto Owner Trust 2009-1, Automobile Receivable Nts., Series 2009-1, Cl. A1, 2.98%, 10/15/151		206,383		207,391
DT Auto Owner Trust 2011-1A, Automobile Receivable Nts., Series 2011-1A, Cl. C, 3.05%, 8/15/151		570,000		571,091
DT Auto Owner Trust 2011-2A, Automobile Receivable Nts., Series 2011-2A, Cl. C, 3.05%, 7/15/131		134,000		133,557
DT Auto Owner Trust 2011-3A, Automobile Receivable Nts., Series 2011-3A, Cl. C, 4.03%, 12/15/413		435,000		434,133
First Investors Auto Owner Trust 2011-1, Automobile Receivable Nts., Series 2011-1, Cl. A2, 1.47%, 3/16/15		304,650		303,242
Ford Credit Auto Lease Trust, Automobile Receivable Nts., Series 2010-B, Cl. A2, 0.75%, 10/15/121		163,213		163,194
Ford Credit Auto Owner Trust, Automobile Receivable Nts., Series 2010-A, Cl. A4, 2.15%, 6/15/15		670,000		683,012

8 | OPPENHEIMER CORE BOND FUND/VA

	Principal
	Amount		Value
Asset-Backed Securities Continued
Ford Credit Floorplan Master Owner Trust 2009-2, Asset-Backed Nts., Series 2009-2, Cl. A, 1.828%, 9/15/142	$	470,000	$	473,627
Ford Credit Floorplan Master Owner Trust 2010-1, Asset-Backed Nts., Series 2010-1, Cl. A, 1.928%, 12/15/141,2		490,000		495,377
Ford Credit Floorplan Master Owner Trust 2011-1, Asset-Backed Nts., Series 2011-1, Cl. A1, 2.12%, 2/15/16		490,000		496,803
GE Dealer Floorplan Master Note Trust, Asset-Backed Securities, Series 2009-2A, Cl. A, 1.828%, 10/20/141,2		460,000		464,060
GMAC Mortgage Servicer Advance Funding Ltd., Asset-Backed Nts., Series 2011-1A, Cl. A, 3.72%, 2/15/231		445,000		444,967
Hertz Vehicle Financing LLC, Automobile Receivable Nts., Series 2010-1A, Cl. A1, 2.60%, 2/25/151		1,015,000		1,026,867
Mastr Asset-Backed Securities Trust 2006-WMC3, Mtg. Pass-Through Certificates, Series 2006-WMC3, Cl. A3, 0.394%, 8/25/362		63,521		19,359
NC Finance Trust, Collateralized Mtg. Obligation Pass-Through Certificates, Series 1999-I, Cl. ECFD, 3.405%, 1/25/293,4		3,370,016		303,301
Nissan Auto Lease Trust 2010-B, Automobile Asset-Backed Nts., Series 2010-B, Cl. A3, 1.12%, 12/15/13		440,000		441,130
Nissan Master Owner Trust, Automobile Receivable Nts., Series 2010-AA, Cl. A, 1.428%, 1/15/151,2		485,000		488,705
Rental Car Finance Corp., Automobile Receivable Nts., Series 2011-1A, Cl. A1, 2.51%, 2/25/161		365,000		364,348
Santander Drive Auto Receivables Trust 2010-2, Automobile Receivables Nts., Series 2010-2, Cl. A2, 0.95%, 8/15/13		181,803		181,798
Santander Drive Auto Receivables Trust 2010-3, Automobile Receivables Nts., Series 2010-3, Cl. C, 3.06%, 11/15/17		485,000		485,029
Santander Drive Auto Receivables Trust 2010-A, Automobile Receivables Nts., Series 2010-A, Cl. A2, 1.37%, 8/15/131		219,052		219,242
Santander Drive Auto Receivables Trust 2011-1, Automobile Receivables Nts., Series 2011-1, Cl. D, 4.01%, 2/15/17		465,000		464,053
Santander Drive Auto Receivables Trust 2011-4, Automobile Receivables Nts., Series 2011-4, Cl. A3, 1.64%, 9/15/15		40,000		40,010
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/173		437,701		433,871
Santander Drive Auto Receivables Trust 2011-S2A, Automobile Receivables Nts., Series 2011-S2A, Cl. D, 3.35%, 6/15/171		369,547		364,004
Volkswagen Auto Lease Trust 2010-A, Automobile Receivable Nts., Series 2010-A, Cl. A3, 0.99%, 11/20/13		440,000		440,715
Westlake Automobile Receivables Trust 2011-1, Automobile Receivables Nts., Series 2011-1, Cl. A3, 1.49%, 6/16/141		205,000		204,801
Total Asset-Backed Securities (Cost $21,965,197)				18,922,092
Mortgage-Backed Obligations—68.7%
Government Agency—56.9%
FHLMC/FNMA/FHLB/Sponsored—56.5%
Federal Home Loan Mortgage Corp.:
4.50%, 1/1/425		3,455,000		3,661,760
5%, 12/15/34		19,762		21,279
5.50%, 9/1/39		1,311,162		1,425,525
6%, 5/15/18-10/15/29		2,556,913		2,819,008
6.50%, 4/15/18-4/1/34		575,095		647,369
7%, 8/15/16-10/1/37		704,099		808,842
8%, 4/1/16		164,882		178,703
9%, 8/1/22-5/1/25		62,719		72,329
10.50%, 11/14/20		2,662		3,227
Federal Home Loan Mortgage Corp., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Series 151, Cl. F, 9%, 5/15/21		15,444		17,675
Series 1674, Cl. Z, 6.75%, 2/15/24		47,509		53,813
Series 2006-11, Cl. PS, 23.49%, 3/25/362		401,801		561,097
Series 2034, Cl. Z, 6.50%, 2/15/28		5,663		6,334
Series 2042, Cl. N, 6.50%, 3/15/28		17,019		19,724
Series 2043, Cl. ZP, 6.50%, 4/15/28		663,971		761,453
Series 2046, Cl. G, 6.50%, 4/15/28		45,826		52,599
Series 2053, Cl. Z, 6.50%, 4/15/28		6,825		7,633
Series 2066, Cl. Z, 6.50%, 6/15/28		740,183		849,508
Series 2195, Cl. LH, 6.50%, 10/15/29		562,840		658,104
Series 2220, Cl. PD, 8%, 3/15/30		2,717		3,244
Series 2326, Cl. ZP, 6.50%, 6/15/31		159,913		185,282

9 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
FHLMC/FNMA/FHLB/Sponsored Continued
Federal Home Loan Mortgage Corp., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates: Continued
Series 2461, Cl. PZ, 6.50%, 6/15/32	$	774,966	$	879,599
Series 2470, Cl. LF, 1.278%, 2/15/322		6,794		6,919
Series 2500, Cl. FD, 0.778%, 3/15/322		151,899		152,645
Series 2526, Cl. FE, 0.678%, 6/15/292		216,768		217,531
Series 2538, Cl. F, 0.878%, 12/15/322		856,802		862,726
Series 2551, Cl. FD, 0.678%, 1/15/332		142,836		143,267
Series 2663, Cl. BA, 4%, 8/1/16		74,057		74,222
Series 2686, Cl. CD, 4.50%, 2/1/17		5,687		5,685
Series 2936, Cl. PE, 5%, 2/1/35		69,000		77,333
Series 3019, Cl. MD, 4.75%, 1/1/31		134,215		134,904
Series 3025, Cl. SJ, 23.73%, 8/15/352		76,803		109,830
Series 3094, Cl. HS, 23.363%, 6/15/342		222,910		301,810
Series 3242, Cl. QA, 5.50%, 3/1/30		86,664		87,040
Series 3822, Cl. JA, 5%, 6/1/40		58,249		63,080
Series 3848, Cl. WL, 4%, 4/1/40		65,158		68,872
Series R001, Cl. AE, 4.375%, 4/1/15		11,643		11,640
Federal Home Loan Mortgage Corp.,
Interest-Only Stripped
Mtg.-Backed Security:
Series 205, Cl. IO, 13.265%, 9/1/296		19,360		3,354
Series 206, Cl. IO, 10.491%, 12/1/296		238,719		43,411
Series 2074, Cl. S, 63.15%, 7/17/286		4,152		889
Series 2079, Cl. S, 73.948%, 7/17/286		7,129		1,537
Series 2130, Cl. SC, 50.33%, 3/15/296		274,054		55,868
Series 243, Cl. 6, 0.377%, 12/15/326		269,732		48,995
Series 2526, Cl. SE, 40.405%, 6/15/296		9,790		1,976
Series 2527, Cl. SG, 10.406%, 2/15/326		145,042		1,546
Series 2531, Cl. ST, 56.547%, 2/15/306		111,449		3,427
Series 2796, Cl. SD, 61.789%, 7/15/266		441,997		86,799
Series 2802, Cl. AS, 62.443%, 4/15/336		232,163		16,640
Series 2819, Cl. S, 53.364%, 6/15/346		91,180		18,501
Series 2920, Cl. S, 63.715%, 1/15/356		1,665,099		282,204
Series 3004, Cl. SB, 99.999%, 7/15/356		95,608		14,714
Series 3110, Cl. SL, 99.999%, 2/15/266		247,773		31,756
Series 3451, Cl. SB, 20.75%, 5/15/386		274,136		32,676
Federal Home Loan Mortgage Corp., Principal-Only Stripped Mtg.-Backed Security, Series 176, Cl. PO, 3.804%, 6/1/267		104,236		95,487
Federal National Mortgage Assn.:
2.579%, 10/1/362		185,087		195,812
3.50%, 1/1/275		5,535,000		5,789,264
4%, 1/1/425		9,480,000		9,961,407
4.50%, 1/1/27-1/1/425		16,305,000		17,361,225
5%, 2/25/22-7/25/22		16,175		17,433
5%, 1/1/425		12,283,000		13,271,401
5.50%, 1/1/27-1/1/425		6,616,000		7,203,121
6%, 1/1/425		3,815,000		4,201,270
6.50%, 5/25/17-1/1/34		1,043,267		1,142,030
6.50%, 1/1/425		1,611,000		1,792,741
7%, 11/1/17-7/25/35		493,426		545,939
7.50%, 1/1/33		11,253		13,408
8.50%, 7/1/32		20,802		25,436
Federal National Mortgage Assn., 15 yr.:
3%, 1/1/275		10,010,000		10,340,017
4%, 1/1/275		490,000		516,873
Federal National Mortgage Assn., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Trust 1989-17, Cl. E, 10.40%, 4/25/19		11,430		12,731
Trust 1993-87, Cl. Z, 6.50%, 6/25/23		557,768		630,536
Trust 1998-58, Cl. PC, 6.50%, 10/25/28		446,810		497,067
Trust 1998-61, Cl. PL, 6%, 11/25/28		228,301		257,001
Trust 1999-54, Cl. LH, 6.50%, 11/25/29		367,654		421,439
Trust 2001-44, Cl. QC, 6%, 9/25/16		20,234		21,597
Trust 2001-51, Cl. OD, 6.50%, 10/25/31		28,123		32,659
Trust 2001-74, Cl. QE, 6%, 12/25/31		647,052		729,510
Trust 2002-12, Cl. PG, 6%, 3/25/17		10,455		11,308
Trust 2003-28, Cl. KG, 5.50%, 4/25/23		3,964,000		4,413,662
Trust 2004-101, Cl. BG, 5%, 1/25/20		1,424,695		1,526,075
Trust 2004-9, Cl. AB, 4%, 7/1/17		234,006		236,062
Trust 2005-12, Cl. JC, 5%, 6/1/28		120,341		120,681
Trust 2005-22, Cl. EC, 5%, 10/1/28		54,062		54,165
Trust 2005-30, Cl. CU, 5%, 4/1/29		74,529		74,946
Trust 2006-46, Cl. SW, 23.123%, 6/25/362		294,847		411,682
Trust 2006-50, Cl. KS, 23.124%, 6/25/362		431,309		601,834
Trust 2007-42, Cl. A, 6%, 2/1/33		715,327		749,709
Trust 2009-36, Cl. FA, 1.234%, 6/25/372		563,821		570,861
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Trust 2001-61, Cl. SH, 38.447%, 11/18/316		25,535		4,596
Trust 2001-63, Cl. SD, 35.722%, 12/18/316		8,219		1,464
Trust 2001-65, Cl. S, 36.948%, 11/25/316		640,666		116,105
Trust 2001-68, Cl. SC, 26.238%, 11/25/316		5,426		983
Trust 2001-81, Cl. S, 31.868%, 1/25/326		175,653		34,736
Trust 2002-28, Cl. SA, 38.371%, 4/25/326		4,862		901
Trust 2002-38, Cl. SO, 53.992%, 4/25/326		12,050		2,197
Trust 2002-39, Cl. SD, 43.567%, 3/18/326		7,968		1,596
Trust 2002-47, Cl. NS, 34.496%, 4/25/326		483,784		92,342
Trust 2002-48, Cl. S, 34.501%, 7/25/326		7,945		1,500
Trust 2002-51, Cl. S, 34.75%, 8/25/326		444,115		84,784
Trust 2002-52, Cl. SD, 40.908%, 9/25/326		560,808		112,159
Trust 2002-52, Cl. SL, 36.61%, 9/25/326		5,025		959
Trust 2002-53, Cl. SK, 41.633%, 4/25/326		27,763		5,723
Trust 2002-56, Cl. SN, 36.625%, 7/25/326		10,833		2,047
Trust 2002-60, Cl. SM, 37.002%, 8/25/326		86,925		13,456

10 | OPPENHEIMER CORE BOND FUND/VA

	Principal
	Amount		Value
FHLMC/FNMA/FHLB/Sponsored Continued
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security: Continued
Trust 2002-7, Cl. SK, 36.625%, 1/25/326	$	40,260	$	6,447
Trust 2002-77, Cl. BS, 31.49%, 12/18/326		52,703		8,904
Trust 2002-77, Cl. IS, 49.219%, 12/18/326		20,530		4,195
Trust 2002-77, Cl. JS, 29.15%, 12/18/326		86,882		13,978
Trust 2002-77, Cl. SA, 30.879%, 12/18/326		83,124		13,979
Trust 2002-77, Cl. SH, 41.744%, 12/18/326		236,071		46,144
Trust 2002-84, Cl. SA, 40.331%, 12/25/326		595,074		102,847
Trust 2002-9, Cl. MS, 33.469%, 3/25/326		9,056		1,756
Trust 2002-90, Cl. SN, 38.32%, 8/25/326		44,719		6,922
Trust 2002-90, Cl. SY, 42.875%, 9/25/326		29,782		4,743
Trust 2003-26, Cl. DI, 11.339%, 4/25/336		19,479		3,223
Trust 2003-33, Cl. SP, 40.253%, 5/25/336		644,497		105,155
Trust 2003-4, Cl. S, 36.576%, 2/25/336		410,619		72,169
Trust 2003-89, Cl. XS, 40.742%, 11/25/326		257,718		12,950
Trust 2004-54, Cl. DS, 51.344%, 11/25/306		406,838		76,427
Trust 2005-14, Cl. SE, 41.553%, 3/25/356		321,895		46,700
Trust 2005-40, Cl. SA, 60.463%, 5/25/356		910,791		162,186
Trust 2005-40, Cl. SB, 70.886%, 5/25/356		43,208		7,327
Trust 2005-71, Cl. SA, 61.213%, 8/25/256		1,064,192		149,205
Trust 2005-93, Cl. SI, 18.704%, 10/25/356		858,372		126,692
Trust 2006-129, Cl. SM, 28.813%, 1/25/376		359,365		51,487
Trust 2006-60, Cl. DI, 38.843%, 4/25/356		219,501		31,667
Trust 2008-55, Cl. SA, 20.914%, 7/25/386		174,277		19,345
Trust 2008-67, Cl. KS, 48.436%, 8/25/346		1,862,074		135,713
Trust 221, Cl. 2, 38.599%, 5/1/236		7,095		1,299
Trust 222, Cl. 2, 25.595%, 6/1/236		797,465		150,091
Trust 252, Cl. 2, 36.807%, 11/1/236		688,313		126,484
Trust 294, Cl. 2, 15.406%, 2/1/286		77,542		12,792
Trust 301, Cl. 2, 2.112%, 4/1/296		8,385		1,516
Trust 303, Cl. IO, 7.301%, 11/1/296		121,718		21,862
Trust 320, Cl. 2, 11.724%, 4/1/326		542,817		94,745
Trust 321, Cl. 2, 1.699%, 4/1/326		1,669,799		301,875
Trust 324, Cl. 2, 0.501%, 7/1/326		17,319		3,083
Trust 331, Cl. 5, 0%, 2/1/336,8		23,882		4,034
Trust 331, Cl. 9, 13.237%, 2/1/336		450,538		88,590
Trust 334, Cl. 12, 0.423%, 2/1/336		42,634		7,058
Trust 334, Cl. 17, 20.883%, 2/1/336		314,392		69,355
Trust 339, Cl. 12, 2.511%, 7/1/336		598,401		114,193
Trust 339, Cl. 7, 4.65%, 7/1/336		1,407,874		200,725
Trust 343, Cl. 13, 10.169%, 9/1/336		571,447		106,302
Trust 343, Cl. 18, 1.089%, 5/1/346		156,841		26,048
Trust 345, Cl. 9, 0%, 1/1/346,8		590,152		76,371
Trust 351, Cl. 10, 0.79%, 4/1/346		214,546		31,305
Trust 351, Cl. 8, 1.45%, 4/1/346		338,575		49,908
Trust 356, Cl. 10, 1.266%, 6/1/356		277,143		40,385
Trust 356, Cl. 12, 1.97%, 2/1/356		138,557		20,198
Trust 362, Cl. 13, 3.439%, 8/1/356		498,643		79,971
Trust 364, Cl. 15, 4.816%, 9/1/356		30,226		4,711
Trust 364, Cl. 16, 0.173%, 9/1/356		581,279		97,023
Trust 365, Cl. 16, 2.414%, 3/1/366		901,114		146,806
Federal National Mortgage Assn., Principal-Only Stripped Mtg.-Backed Security, Trust 1993-184, Cl. M, 4.278%, 9/25/237		247,603		224,077
				104,288,809
GNMA/Guaranteed—0.4%
Government National Mortgage Assn.:
7%, 12/29/23-3/15/26		24,890		28,843
8.50%, 8/1/17-12/15/17		89,649		101,221
Government National Mortgage Assn., Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates:
Series 1999-32, Cl. ZB, 8%, 9/16/29		74,144		88,350
Series 2000-7, Cl. Z, 8%, 1/16/30		31,700		38,060
Government National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Series 1998-19, Cl. SB, 71.063%, 7/16/286		15,299		3,310
Series 2001-21, Cl. SB, 91.534%, 1/16/276		545,428		107,416
Series 2002-15, Cl. SM, 82.478%, 2/16/326		571,974		106,165
Series 2004-11, Cl. SM, 73.936%, 1/17/306		451,877		102,989
Series 2007-17, Cl. AI, 21.009%, 4/16/376		170,572		31,993
				608,347
Non-Agency—11.8%
Commercial—8.7%
Asset Securitization Corp., Commercial Interest-Only Stripped Mtg.-Backed Security, Series 1997-D4, Cl. PS1, 0.304%, 4/14/296		5,269,927		145,432
Banc of America Commercial Mortgage Trust 2007-1, Commercial Mtg. Pass-Through Certificates, Series 2007-1, Cl. A4, 5.451%, 1/1/49		710,000		774,322
Banc of America Commercial Mortgage, Inc., Commercial Mtg. Pass-Through Certificates, Series 2007-3, Cl. A4, 5.622%, 6/1/492		385,000		414,465
Capital Lease Funding Securitization LP, Interest-Only Corporate-Backed Pass-Through Certificates, Series 1997-CTL1, 3.287%, 6/22/241,6		2,702,173		131,511
CFCRE Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2011-C1, Cl. A1, 1.871%, 4/1/441		134,414		134,106

11 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Commercial Continued
CHL Mortgage Pass-Through Trust 2005-17, Mtg. Pass-Through Certificates, Series 2005-17, Cl. 1A8, 5.50%, 9/1/35	$	67,367	$	64,310
CHL Mortgage Pass-Through Trust 2007-J3, Mtg. Pass-Through Certificates, Series 2007-J3, Cl. A9, 6%, 7/1/37		321,377		254,324
Citigroup, Inc./Deutsche Bank 2007-CD4 Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates:
Series 2007-CD4, Cl. A2B, 5.205%, 12/11/49		376,206		381,230
Series 2007-CD4, Cl. A4, 5.322%, 12/1/49		875,000		931,627
Deutsche Mortgage & Asset Receiving, Commercial Mtg. Pass-Through Certificates, Series 2010-C1, Cl. A1, 3.156%, 7/1/461		581,251		598,446
Deutsche Mortgage & Asset Receiving, Commercial Mtg. Pass-Through Certificates, Interest-Only Stripped Mtg.-Backed Security, Series 2010-C1, Cl. XPA, 4.857%, 9/1/201,6		4,602,164		345,880
First Horizon Alternative Mortgage Securities Trust 2004-FA2, Mtg. Pass-Through Certificates, Series 2004-FA2, Cl. 3A1, 6%, 1/25/35		515,654		503,080
First Horizon Alternative Mortgage Securities Trust 2007-FA2, Mtg. Pass-Through Certificates, Series 2007-FA2, Cl. 1A1, 5.50%, 4/25/37		199,832		131,099
First Horizon Mortgage Pass-Through Trust 2007-AR3, Mtg. Pass-Through Certificates, Series 2007-AR3, Cl. 1A1, 5.857%, 11/1/372		383,103		233,851
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG11, Commercial Mtg. Pass-Through Certificates, Series 2007-GG11, Cl. A4, 5.736%, 12/1/49		1,280,000		1,386,588
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. AM, 5.475%, 3/1/39		495,000		466,759
GS Mortgage Securities Corp. II, Commercial Mtg. Obligations, Series 2011-GC3, Cl. A1, 2.331%, 3/1/44		351,661		359,584
GSR Mortgage Loan Trust 2005-AR4, Mtg. Pass-Through Certificates, Series 2005-AR4, Cl. 6A1, 5.25%, 7/1/35		380,206		350,790
Impac CMB Trust Series 2005-4, Collateralized Asset-Backed Bonds, Series 2005-4, Cl. 1A1A, 0.834%, 5/25/352		566,538		385,765
IndyMac Index Mortgage Loan Trust 2005-AR23, Mtg. Pass-Through Certificates, Series 2005-AR23, Cl. 6A1, 5.11%, 11/1/352		656,173		447,249
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial Mtg. Pass-Through Certificates:
Series 2011-C3, Cl. A1, 1.875%, 2/1/461		396,095		397,831
Series 2010-C2, Cl. A2, 3.616%, 11/1/431		710,000		739,079
Series 2007-LDPX, Cl. A2S2, 5.187%, 1/1/493		1,270,963		1,283,164
JPMorgan Mortgage Trust 2007-S3, Mtg. Pass-Through Certificates, Series 2007-S3, Cl. 1A90, 7%, 8/1/37		646,709		543,845
LB-UBS Commercial Mortgage Trust 2007-C6, Commercial Mtg. Pass-Through Certificates, Series 2007-C6, Cl. A4, 5.858%, 7/11/40		880,000		967,894
Lehman Brothers Commercial Conduit Mortgage Trust, Interest- Only Stripped Mtg.-Backed Security, Series 1998-C1, Cl. IO, 57.776%, 2/18/306		3,192,227		51,436
Lehman Structured Securities Corp., Commercial Mtg. Pass-Through Certificates, Series 2002-GE1, Cl. A, 2.514%, 7/1/241		132,743		108,327
Mastr Alternative Loan Trust 2004-6, Mtg. Pass-Through Certificates, Series 2004-6, Cl. 10A1, 6%, 7/25/34		904,998		928,973
Morgan Stanley Capital I Trust 2007-IQ15, Commercial Mtg. Pass-Through Certificates, Series 2007-IQ15, Cl. AM, 5.879%, 6/1/492		490,000		463,298
Salomon Brothers Mortgage Securities VII, Inc., Interest-Only Commercial Mtg. Pass-Through Certificates, Series 1999-C1, Cl. X, 31.725%, 5/18/326		41,277,456		96,548

12 | OPPENHEIMER CORE BOND FUND/VA

	Principal
	Amount		Value
Commercial Continued
Structured Adjustable Rate Mortgage Loan Trust, Mtg. Pass-Through Certificates, Series 2007-6, Cl. 3A1, 5.118%, 7/1/372	$	591,438	$	356,032
Wachovia Bank Commercial Mortgage Trust 2007-C34, Commercial Mtg. Pass-Through Certificates, Series 2007-C34, Cl. A3, 5.678%, 5/1/46		520,000		572,745
WaMu Mortgage Pass-Through Certificates 2005-AR14 Trust, Mtg. Pass-Through Certificates, Series 2005-AR14, Cl. 1A4, 2.474%, 12/1/352		360,667		279,814
Wells Fargo Commercial Mortgage Trust 2010-C1, Commercial Mtg. Pass-Through Certificates, Series 2010-C1, Cl. A1, 3.349%, 11/1/431		358,437		372,057
Wells Fargo Mortgage-Backed Securities 2007-AR3 Trust, Mtg. Pass-Through Certificates, Series 2007-AR3, Cl. A4, 5.777%, 4/1/372		182,781		147,685
Wells Fargo Mortgage-Backed Securities 2007-AR8 Trust, Mtg. Pass-Through Certificates, Series 2007-AR8, Cl. A1, 6.042%, 11/1/372		455,796		332,157
				16,081,303
Multifamily—0.5%
Citigroup Mortgage Loan Trust, Inc. 2006-AR3, Mtg. Pass-Through Certificates, Series 2006-AR3, Cl. 1A2A, 5.672%, 6/1/362		415,587		339,132
JPMorgan Mortgage Trust 2007-A3, Mtg. Pass-Through Certificates, Series 2007-A3, Cl. 3A2M, 5.259%, 5/1/372		155,749		126,031
Wells Fargo Mortgage-Backed Securities 2006-AR6 Trust, Mtg. Pass-Through Certificates, Series 2006-AR6, Cl. 3A1, 2.689%, 3/25/362		508,897		406,937
				872,100
Other—0.2%
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. A4, 5.444%, 3/1/39		350,000		380,274
Salomon Brothers Mortgage Securities VI, Inc., Interest-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. B, 77.143%, 10/23/176		562		55
Salomon Brothers Mortgage Securities VI, Inc., Principal-Only Stripped Mtg.-Backed Security, Series 1987-3, Cl. A, 3.603%, 10/23/177		832		816
				381,145
Residential—2.4%
Banc of America Funding 2007-C Trust, Mtg. Pass-Through Certificates, Series 2007-C, Cl. 1A4, 5.544%, 5/1/362		155,000		137,355
CHL Mortgage Pass-Through Trust 2005-29, Mtg. Pass-Through Certificates, Series 2005-29, Cl. A1, 5.75%, 12/1/35		231,189		193,936
CHL Mortgage Pass-Through Trust 2005-30, Mtg. Pass-Through Certificates, Series 2005-30, Cl. A5, 5.50%, 1/1/36		339,202		326,136
CHL Mortgage Pass-Through Trust 2005-J4, Mtg. Pass-Through Certificates, Series 2005-J4, Cl. A7, 5.50%, 11/1/35		36,141		34,989
Countrywide Alternative Loan Trust 2007-19, Mtg. Pass-Through Certificates, Series 2007-19, Cl. 1A34, 6%, 8/1/37		373,766		260,289
GSR Mortgage Loan Trust 2006-5F, Mtg. Pass-Through Certificates, Series 2006-5F, Cl. 2A1, 6%, 6/1/36		380,681		370,535
JPMorgan Alternative Loan Trust 2006-S4, Mtg. Pass-Through Certificates, Series 2006-S4, Cl. A6, 5.71%, 12/1/36		524,442		450,761
Merrill Lynch Mortgage Investors Trust 2006-3, Mtg. Pass-Through Certificates, Series MLCC 2006-3, Cl. 2A1, 2.375%, 10/25/362		44,682		40,319
RALI Series 2003-QS1 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2003-QS1, Cl. A2, 5.75%, 1/25/33		232,844		241,629
RALI Series 2006-QS13 Trust, Mtg. Asset-Backed Pass-Through Certificates:
Series 2006-QS13, Cl. 1A5, 6%, 9/25/36		54,626		31,012
Series 2006-QS13, Cl. 1A8, 6%, 9/25/36		1,914		1,087
RALI Series 2007-QS6 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2007-QS6, Cl. A28, 5.75%, 4/25/37		23,792		13,952

13 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Residential Continued
Residential Asset Securitization Trust 2005-A15, Mtg. Pass-Through Certificates, Series 2005-A15, Cl. 1A4, 5.75%, 2/1/36	$	153,247	$	118,795
Structured Adjustable Rate Mortgage Loan Trust, Mtg. Pass-Through Certificates, Series 2004-5, Cl. 3A1, 2.505%, 5/1/342		238,564		219,579
WaMu Mortgage Pass-Through Certificates 2007-HY1 Trust, Mtg. Pass-Through Certificates, Series 2007-HY1, Cl. 4A1, 2.61%, 2/1/372		59,121		39,307
WaMu Mortgage Pass-Through Certificates 2007-HY5 Trust, Mtg. Pass-Through Certificates, Series 2007-HY5, Cl. 3A1, 5.467%, 5/1/372		849,883		709,694
Wells Fargo Alternative Loan 2007-PA5 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2007-PA5, Cl. 1A1, 6.25%, 11/1/37		356,352		277,141
Wells Fargo Mortgage-Backed Securities 2004-R Trust, Mtg. Pass-Through Certificates, Series 2004-R, Cl. 2A1, 2.625%, 9/1/342		230,777		219,987
Wells Fargo Mortgage-Backed Securities 2005-9 Trust, Mtg. Pass-Through Certificates, Series 2005-9, Cl. 2A6, 5.25%, 10/25/35		469,449		451,553
Wells Fargo Mortgage-Backed Securities 2006-AR14 Trust, Mtg. Pass-Through Certificates, Series 2006-AR14, Cl. 1A2, 5.667%, 10/1/362		389,016		326,937
				4,464,993
Total Mortgage-Backed Obligations (Cost $124,323,010)				126,696,697
U.S. Government Obligations—1.7%
Federal Home Loan Mortgage Corp. Nts.:
2%, 8/25/16		180,000		187,467
2.50%, 5/27/16		255,000		270,459
5%, 2/16/17		295,000		348,763
5.25%, 4/18/16		515,000		607,516
5.50%, 7/18/16		295,000		352,295
Federal National Mortgage Assn. Nts.:
2.375%, 4/11/169		485,000		513,160
4.875%, 12/15/16		415,000		489,583
5%, 3/15/16		320,000		373,407
Total U.S. Government Obligations (Cost $2,949,907)				3,142,650
Corporate Bonds and Notes—42.4%
Consumer Discretionary—7.0%
Automobiles—0.6%
Daimler Finance North America LLC, 1.875% Sr. Unsec. Nts., 9/15/141		348,000		346,388
DaimlerChrysler NA Holdings Corp., 8.50% Nts., 1/18/31		192,000		268,806
Ford Motor Credit Co. LLC, 5.875% Sr. Unsec. Nts., 8/2/21		513,000		535,436
				1,150,630
Diversified Consumer Services—0.3%
Service Corp. International, 6.75% Sr. Unsec. Nts., 4/1/15		475,000		513,000
Hotels, Restaurants & Leisure—0.7%
Hyatt Hotels Corp., 5.75% Sr. Unsec. Unsub. Nts., 8/15/151		753,000		807,159
Marriott International, Inc., 6.20% Sr. Unsec. Unsub. Nts., 6/15/16		526,000		591,893
				1,399,052
Household Durables—0.8%
Jarden Corp., 6.125% Sr. Unsec. Nts., 11/15/22		435,000		446,963
Newell Rubbermaid, Inc., 5.50% Sr. Unsec. Nts., 4/15/13		429,000		450,011
Whirlpool Corp.:
5.50% Sr. Unsec. Unsub. Nts., 3/1/13		152,000		158,025
8% Sr. Unsec. Nts., 5/1/12		380,000		388,522
				1,443,521
Leisure Equipment & Products—0.2%
Mattel, Inc., 5.625% Sr. Unsec. Nts., 3/15/13		395,000		415,182
Media—2.9%
Comcast Cable Communications Holdings, Inc., 9.455% Sr. Unsec. Nts., 11/15/22		292,000		416,697
Comcast Corp., 6.40% Sr. Unsec. Nts., 3/1/40		112,000		139,465
CSC Holdings, Inc., 7.625% Sr. Unsec. Debs., 7/15/18		404,000		446,420
DIRECTV Holdings LLC/DIRECTV Financing Co., Inc., 6.375% Sr. Unsec. Nts., 3/1/41		359,000		414,641
Dish DBS Corp., 6.75% Sr. Unsec. Nts., 6/1/21		431,000		466,558
Historic TW, Inc., 9.125% Debs., 1/15/13		149,000		160,706
Interpublic Group of Cos., Inc. (The):
6.25% Sr. Unsec. Nts., 11/15/14		190,000		202,825
10% Sr. Unsec. Nts., 7/15/17		528,000		605,880
Lamar Media Corp., 9.75% Sr. Unsec. Nts., 4/1/14		438,000		492,750

14 | OPPENHEIMER CORE BOND FUND/VA

	Principal
	Amount		Value
Media Continued
News America, Inc., 6.15% Sr. Unsec. Nts., 2/15/41	$	281,000	$	324,443
Time Warner Entertainment Co. LP, 8.375% Sr. Nts., 7/15/33		257,000		337,314
Time Warner, Inc., 4% Sr. Unsec. Unsub. Nts., 1/15/22		439,000		453,563
Virgin Media Secured Finance plc:
5.25% Sr. Sec. Nts., 1/15/21		230,000		244,032
6.50% Sr. Sec. Nts., 1/15/18		555,000		592,463
				5,297,757
Multiline Retail—0.7%
Family Dollar Stores, Inc., 5% Sr. Unsec. Nts., 2/1/21		261,000		268,997
Macy’s Retail Holdings, Inc., 5.75% Sr. Unsec. Nts., 7/15/14		765,000		814,312
Target Corp., 7% Bonds, 1/15/38		103,000		144,217
				1,227,526
Specialty Retail—0.8%
Limited Brands, Inc., 6.625% Sr. Nts., 4/1/21		426,000		453,690
Rent-A-Center, Inc., 6.625% Sr. Unsec. Nts., 11/15/20		477,000		482,963
Sally Holdings LLC/Sally Capital, Inc., 6.875% Sr. Unsec. Nts., 11/15/191		460,000		483,000
				1,419,653
Consumer Staples—2.9%
Beverages—0.5%
Anheuser-Busch Inbev Worldwide, Inc., 7.75% Sr. Unsec. Unsub. Nts., 1/15/19		246,000		318,970
Fortune Brands, Inc., 6.375% Sr. Unsec. Unsub. Nts., 6/15/14		119,000		130,217
Pernod-Ricard SA, 4.45% Sr. Unsec. Nts., 1/15/221		459,000		481,620
				930,807
Food & Staples Retailing—0.4%
CVS Caremark Corp., 6.125% Sr. Unsec. Unsub. Nts., 9/15/39		174,000		212,109
Delhaize Group, 5.70% Sr. Unsec. Nts., 10/1/40		133,000		136,768
Kroger Co. (The), 5% Sr. Nts., 4/15/13		443,000		463,636
				812,513
Food Products—0.9%
Bunge Ltd. Finance Corp.:
5.35% Sr. Unsec. Unsub. Nts., 4/15/14		210,000		220,401
8.50% Sr. Unsec. Nts., 6/15/19		200,000		243,726
Kraft Foods, Inc.:
6% Sr. Unsec. Nts., 2/11/13		410,000		432,105
6.50% Sr. Unsec. Unsub. Nts., 2/9/40		262,000		341,447
TreeHouse Foods, Inc., 7.75% Sr. Unsec. Nts., 3/1/18		470,000		509,950
				1,747,629
Household Products—0.3%
Energizer Holdings, Inc., 4.70% Sr. Nts., 5/19/211		463,000		488,000
Tobacco—0.8%
Altria Group, Inc., 10.20% Sr. Unsec. Nts., 2/6/39		358,000		557,902
Lorillard Tobacco Co., 7% Sr. Unsec. Nts., 8/4/41		311,000		327,398
Reynolds American, Inc., 7.25% Sr. Sec. Nts., 6/1/13		460,000		493,574
				1,378,874
Energy—5.8%
Energy Equipment & Services—1.5%
Ensco plc, 4.70% Sr. Unsec. Nts., 3/15/21		524,000		546,511
Nabors Industries, Inc., 6.15% Sr. Unsec. Unsub. Nts., 2/15/18		593,000		663,116
Precision Drilling Corp.:
6.50% Sr. Unsec. Nts., 12/15/211		217,000		222,425
6.625% Sr. Unsec. Nts., 11/15/20		208,000		213,720
Rowan Cos., Inc., 5% Sr. Unsec. Nts., 9/1/17		499,000		525,103
Weatherford International Ltd. Bermuda, 5.125% Sr. Unsec. Unsub. Nts., 9/15/20		496,000		516,154
				2,687,029
Oil, Gas & Consumable Fuels—4.3%
Anadarko Petroleum Corp., 6.20% Sr. Unsec. Nts., 3/15/40		316,000		352,265
BG Energy Capital plc, 4% Sr. Unsec. Nts., 10/15/211		329,000		339,671
Bill Barrett Corp., 7.625% Sr. Unsec. Unsub. Nts., 10/1/19		427,000		448,350
Canadian Oil Sands Ltd., 5.80% Sr. Unsec. Nts., 8/15/131		457,000		485,050
Cloud Peak Energy Resources LLC, 8.25% Sr. Unsec. Unsub. Nts., 12/15/17		445,000		476,150
El Paso Pipeline Partners LP, 6.50% Sr. Unsec. Nts., 4/1/20		665,000		736,003
Encana Corp., 3.90% Sr. Unsec. Unsub. Nts., 11/15/21		169,000		170,055
Energy Transfer Partners LP, 4.65% Sr. Unsec. Unsub. Nts., 6/1/21		374,000		366,921

15 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Oil, Gas & Consumable Fuels Continued
EQT Corp., 4.875% Sr. Unsec. Unsub. Nts., 11/15/21	$	281,000	$	284,095
Kaneb Pipe Line Operating Partnership LP, 5.875% Sr. Unsec. Nts., 6/1/13		757,000		798,217
Marathon Petroleum Corp., 5.125% Sr. Unsec. Unsub. Nts., 3/1/21		240,000		251,088
Newfield Exploration Co., 6.875% Sr. Unsec. Sub. Nts., 2/1/20		419,000		450,425
Nexen, Inc., 6.40% Sr. Unsec. Unsub. Bonds, 5/15/37		466,000		494,375
Range Resources Corp., 8% Sr. Unsec. Sub. Nts., 5/15/19		427,000		478,240
Ras Laffan Liquefied Natural Gas Co. Ltd. III, 5.50% Sr. Sec. Nts., 9/30/141		270,000		290,250
Rockies Express Pipeline LLC, 3.90% Sr. Unsec. Unsub. Nts., 4/15/151		764,000		755,669
Sunoco Logistics Partners Operations LP, 7.25% Sr. Unsec. Nts., 2/15/12		441,000		443,875
Woodside Finance Ltd., 4.60% Sr. Unsec. Nts., 5/10/211		339,000		346,666
				7,967,365
Financials—12.9%
Capital Markets—3.0%
Blackstone Holdings Finance Co. LLC, 6.625% Sr. Unsec. Nts., 8/15/191		800,000		847,510
Goldman Sachs Capital, Inc. (The), 6.345% Sub. Bonds, 2/15/34		477,000		404,266
Goldman Sachs Group, Inc. (The):
5.25% Sr. Unsec. Nts., 7/27/21		703,000		686,821
6.25% Sr. Nts., 2/1/41		443,000		435,284
Macquarie Bank Ltd., 6.625% Unsec. Sub. Nts., 4/7/211		598,000		552,070
Morgan Stanley:
5.50% Sr. Unsec. Unsub. Nts., 7/24/201		262,000		238,534
5.55% Sr. Unsec. Unsub. Nts., Series F, 4/27/17		1,285,000		1,241,467
Nomura Holdings, Inc., 4.125% Sr. Unsec. Unsub. Nts., 1/19/16		433,000		423,022
TD Ameritrade Holding Corp., 2.95% Sr. Unsec. Unsub. Nts., 12/1/12		509,000		515,496
UBS AG Stamford CT, 2.25% Sr. Unsec. Nts., 8/12/13		181,000		179,479
				5,523,949
Commercial Banks—2.4%
ANZ National International Ltd., 2.375% Sr. Unsec. Nts., 12/21/121		507,000		515,895
Fifth Third Cap Trust IV, 6.50% Jr. Unsec. Sub. Nts., 4/15/37		845,000		832,325
HSBC Finance Capital Trust IX, 5.911% Nts., 11/30/352		1,090,000		910,150
Lloyds TSB Bank plc, 6.50% Unsec. Sub. Nts., 9/14/201		356,000		298,261
Mercantile Bankshares Corp., 4.625% Unsec. Sub. Nts., Series B, 4/15/13		308,000		321,087
Sumitomo Mitsui Banking Corp., 8% Unsec. Sub. Nts., 6/15/12		466,000		477,454
Wells Fargo & Co., 7.98% Jr. Sub. Perpetual Bonds, Series K10		367,000		394,984
Zions Bancorp., 7.75% Sr. Unsec. Nts., 9/23/14		581,000		616,481
				4,366,637
Consumer Finance—1.0%
American Express Bank FSB, 5.50% Sr. Unsec. Nts., 4/16/13		441,000		461,146
American Express Credit Corp., 2.80% Sr. Unsec. Unsub. Nts., 9/19/16		450,000		452,800
Capital One Financial Corp., 4.75% Sr. Nts., 7/15/21		439,000		452,472
SLM Corp., 6.25% Sr. Nts., 1/25/16		602,000		586,051
				1,952,469
Diversified Financial Services—2.3%
Bank of America Corp., 3.75% Sr. Unsec. Unsub. Nts., 7/12/16		495,000		458,890
Citigroup, Inc., 6.125% Sr. Unsec. Unsub. Nts., 11/21/17		1,462,000		1,562,606
Glen Meadow Pass-Through Trust, 6.505% Bonds, 2/12/672,3		666,000		474,525
Irish Life & Permanent Group Holdings plc, 3.60% Sr. Unsec. Unsub. Nts., 1/14/131		320,000		283,075
JPMorgan Chase & Co.:
5.40% Sr. Unsec. Nts., 1/6/42		135,000		141,140
7.90% Perpetual Bonds, Series 110		869,000		928,337
Merrill Lynch & Co., Inc., 7.75% Jr. Sub. Bonds, 5/14/38		416,000		395,765
				4,244,338
Insurance—3.4%
Burlington Northern Santa Fe LLC, 5.75% Sr. Unsec. Bonds, 5/1/40		125,000		149,824
CNA Financial Corp.:
5.75% Sr. Unsec. Unsub. Nts., 8/15/21		368,000		376,069
5.875% Sr. Unsec. Unsub. Bonds, 8/15/20		260,000		267,444
Gulf South Pipeline Co. LP, 5.75% Sr. Unsec. Nts., 8/15/121		455,000		465,101
Hartford Financial Services Group, Inc. (The), 6.625% Sr. Unsec. Unsub. Nts., 3/30/40		306,000		304,141

16 | OPPENHEIMER CORE BOND FUND/VA

	Principal
	Amount		Value
Insurance Continued
International Lease Finance Corp., 5.75% Sr. Unsec. Unsub. Nts., 5/15/16	$	441,000	$	409,507
Liberty Mutual Group, Inc., 5% Sr. Nts., 6/1/211		685,000		672,230
Lincoln National Corp., 6.05% Jr. Unsec. Sub. Bonds, 4/20/67		945,000		793,800
Prudential Financial, Inc., 5.375% Sr. Unsec. Unsub. Nts., 6/21/20		833,000		892,720
Swiss Re Capital I LP, 6.854% Perpetual Bonds1,10		875,000		748,136
Unum Group, 5.625% Sr. Unsec. Unsub. Nts., 9/15/20		320,000		329,947
Willis Group Holdings plc, 4.125% Sr. Unsec. Unsub. Nts., 3/15/16		463,000		470,781
ZFS Finance USA Trust V, 6.50% Jr. Sub. Bonds, 5/9/372,3		513,000		464,265
				6,343,965
Real Estate Investment Trusts—0.8%
Brandywine Operating Partnership LP, 5.75% Sr. Unsec. Unsub. Nts., 4/1/12		237,000		238,529
CommonWealth REIT, 6.95% Sr. Unsec. Nts., 4/1/12		103,000		103,000
Duke Realty LP, 6.25% Sr. Unsec. Unsub. Nts., 5/15/13		464,000		485,460
Mack-Cali Realty LP, 5.25% Sr. Unsec. Unsub. Nts., 1/15/12		180,000		180,135
WCI Finance LLC/WEA Finance LLC, 5.40% Sr. Unsec. Unsub. Nts., 10/1/121		439,000		449,883
				1,457,007
Health Care—0.8%
Biotechnology—0.2%
Celgene Corp., 5.70% Sr. Unsec. Nts., 10/15/40		291,000		320,836
Health Care Providers & Services—0.3%
McKesson Corp., 6% Sr. Unsec. Unsub. Nts., 3/1/41		237,000		303,487
Quest Diagnostics, Inc., 5.75% Sr. Unsec. Nts., 1/30/40		300,000		324,114
				627,601
Pharmaceuticals—0.3%
Mylan, Inc., 6% Sr. Nts., 11/15/181		495,000		511,706
Industrials—3.0%
Aerospace & Defense—0.5%
Alliant Techsystems, Inc., 6.75% Sr. Sub. Nts., 4/1/16		477,000		491,310
BE Aerospace, Inc., 8.50% Sr. Unsec. Nts., 7/1/18		420,000		462,000
				953,310
Commercial Services & Supplies—0.5%
Corrections Corp. of America, 7.75% Sr. Nts., 6/1/17		473,000		515,570
R.R. Donnelley & Sons Co., 8.60% Sr. Unsec. Unsub. Nts., 8/15/16		434,000		436,713
				952,283
Industrial Conglomerates—1.0%
General Electric Capital Corp.:
4.25% Sr. Unsec. Nts., Series A, 6/15/12		460,000		465,631
4.65% Sr. Unsec. Nts., 10/17/21		446,000		466,208
5.25% Sr. Unsec. Nts., 10/19/12		28,000		28,986
6.375% Unsec. Sub. Bonds, 11/15/67		852,000		841,350
				1,802,175
Machinery—0.6%
CNH Capital LLC, 6.25% Sr. Unsec. Nts., 11/1/161		457,000		472,995
Joy Global, Inc., 5.125% Sr. Unsec. Unsub. Nts., 10/15/21		216,000		230,928
SPX Corp., 6.875% Sr. Unsec. Nts., 9/1/171		412,000		447,020
				1,150,943
Professional Services—0.1%
FTI Consulting, Inc., 6.75% Sr. Unsec. Nts., 10/1/20		76,000		78,850
Road & Rail—0.3%
CSX Corp., 5.50% Sr. Unsec. Nts., 4/15/41		130,000		147,523
Kansas City Southern de Mexico, 8% Sr. Unsec. Unsub. Nts., 2/1/18		400,000		442,000
				589,523
Information Technology—1.8%
Communications Equipment—0.2%
Harris Corp., 6.15% Sr. Unsec. Nts., 12/15/40		144,000		163,126
Juniper Networks, Inc., 5.95% Sr. Unsec. Unsub. Nts., 3/15/41		179,000		196,113
				359,239
Computers & Peripherals—0.4%
Hewlett-Packard Co.:
2.35% Sr. Unsec. Unsub. Nts., 3/15/15		490,000		488,076
4.65% Sr. Unsec. Nts., 12/9/21		363,000		383,605
				871,681
Electronic Equipment & Instruments—0.5%
Arrow Electronics, Inc., 3.375% Sr. Unsec. Unsub. Nts., 11/1/15		875,000		877,062
Office Electronics—0.2% Xerox Corp., 5.65% Sr. Unsec. Nts., 5/15/13		435,000		456,861

17 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
Semiconductors & Semiconductor Equipment—0.2%
KLA-Tencor Corp., 6.90% Sr. Unsec. Nts., 5/1/18	$	306,000		$	353,233
Software—0.3%
Symantec Corp., 4.20% Sr. Unsec. Unsub. Nts., 9/15/20		517,000			520,611
Materials—3.0%
Chemicals—1.1%
Agrium, Inc., 6.125% Sr. Unsec. Nts., 1/15/41		200,000			248,518
Airgas, Inc., 3.25% Sr. Nts., 10/1/15		842,000			867,202
Ashland, Inc., 9.125% Sr. Unsec. Nts., 6/1/17		440,000			492,800
Potash Corp. of Saskatchewan, Inc., 5.625% Sr. Unsec. Unsub. Nts., 12/1/40		285,000			348,654
					1,957,174
Containers & Packaging—0.2%
Sealed Air Corp., 7.875% Sr. Nts., 6/15/17		370,000			390,615
Metals & Mining—1.5%
Freeport-McMoRan Copper & Gold, Inc., 8.375% Sr. Nts., 4/1/17		698,000			742,411
Petrohawk Energy Corp., 6.25% Sr. Unsec. Nts., 6/1/19		669,000			739,245
Teck Resources Ltd., 7% Sr. Unsec. Unsub. Nts., 9/15/12		465,000			482,788
Vale Inco Ltd., 5.70% Sr. Unsec. Unsub. Nts., 10/15/15		28,000			30,516
Xstrata Canada Corp.:
5.375% Sr. Unsec. Unsub. Nts., 6/1/15		245,000			266,297
6% Sr. Unsec. Unsub. Nts., 10/15/15		432,000			465,810
7.25% Sr. Unsec. Unsub. Nts., 7/15/12		80,000			82,422
					2,809,489
Paper & Forest Products—0.2%
International Paper Co., 4.75% Sr. Unsec. Unsub. Nts., 2/15/22		365,000			388,591
Telecommunication Services—2.3%
Diversified Telecommunication Services—1.6%
AT&T, Inc., 6.30% Sr. Unsec. Bonds, 1/15/38		518,000			637,038
British Telecommunications plc, 9.875% Bonds, 12/15/30		298,000			420,488
CenturyLink, Inc., 7.60% Sr. Unsec. Unsub. Nts., Series P, 9/15/39		158,000			155,252
Frontier Communications Corp., 8.25% Sr. Unsec. Nts., 4/15/17		477,000			490,118
Qwest Corp., 7.625% Sr. Unsec. Unsub. Nts., 6/15/15		447,000			497,682
Verizon Communications, Inc., 6.40% Sr. Unsec. Nts., 2/15/38		286,000			363,665
Windstream Corp., 7.875% Sr. Unsec. Unsub. Nts., 11/1/17		412,000			448,050
					3,012,293
Wireless Telecommunication Services—0.7%
America Movil SAB de CV, 2.375% Unsec. Unsub. Nts., 9/8/16		774,000			775,884
American Tower Corp.:
5.05% Sr. Unsec. Unsub. Nts., 9/1/20		130,000			130,416
7% Sr. Unsec. Nts., 10/15/17		337,000			381,116
					1,287,416
Utilities—2.9%
Electric Utilities—2.3%
Allegheny Energy Supply Co. LLC, 8.25% Bonds, 4/15/121		447,000			455,114
Edison International, 3.75% Sr. Unsec. Unsub. Nts., 9/15/17		342,000			352,469
FirstEnergy Solutions Corp., 6.80% Sr. Unsec. Nts., 8/15/39		292,000			327,488
Great Plains Energy, Inc., 2.75% Sr. Unsec. Unsub. Nts., 8/15/13		464,000			470,842
Kansas City Power & Light Co., 5.30% Sr. Unsec. Nts., 10/1/41		261,000			281,443
Northeast Utilities Co., 7.25% Sr. Unsec. Nts., 4/1/12		470,000			476,689
Oncor Electric Delivery Co., 7% Debs., 9/1/22		409,000			524,752
PPL WEM Holdings plc, 5.375% Sr. Unsec. Nts., 5/1/211		655,000			687,874
Texas-New Mexico Power Co., 9.50% Sec. Nts., 4/1/191		510,000			669,632
					4,246,303
Energy Traders—0.3%
TransAlta Corp., 5.75% Sr. Unsec. Nts., 12/15/13		455,000			487,330
Multi-Utilities—0.3%
CMS Energy Corp., 6.25% Sr. Unsec. Nts., 2/1/20		424,000			447,228
Pacific Gas & Electric Co., 4.50% Sr. Unsec. Nts., 12/15/41		116,000			118,852
					566,080
Total Corporate Bonds and Notes (Cost $76,704,877)					78,338,108
	Shares
Investment Company—15.3%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%11,12 (Cost $28,319,973)		28,319,973			28,319,973
Total Investments, at Value (Cost $254,262,964)		138.4	%		255,419,520
Liabilities in Excess of Other Assets		(38.4	)		(70,854,222	)
Net Assets		100.0	%	$	184,565,298

18 | OPPENHEIMER CORE BOND FUND/VA

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $24,761,703 or 13.42% of the Fund’s net assets as of December 30, 2011.
2.	Represents the current interest rate for a variable or increasing rate security.
3.	Restricted security. The aggregate value of restricted securities as of December 30, 2011 was $3,393,259, which represents 1.84% of the Fund’s net assets. See Note 6 of the accompanying Notes. Information concerning restricted securities is as follows:

							Unrealized
	Acquisition						Appreciation
Security	Dates		Cost		Value		(Depreciation)
DT Auto Owner Trust 2011-3A, Automobile Receivable Nts., Series 2011-3A, Cl. C, 4.03%, 12/15/41		11/2/11	$	434,965	$	434,133	$	(832	)
Glen Meadow Pass-Through Trust, 6.505% Bonds, 2/12/67		1/5/11-10/11/11		543,979		474,525		(69,454	)
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial
Mtg. Pass-Through Certificates, Series 2007-LDPX, Cl. A2S2, 5.187%, 1/1/49		7/14/10		1,255,075		1,283,164		28,089
NC Finance Trust, Collateralized Mtg. Obligation Pass-Through Certificates, Series 1999-I, Cl. ECFD, 3.405%, 1/25/29		8/10/10		3,281,116		303,301		(2,977,815	)
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/17		2/4/11-4/14/11		438,271		433,871		(4,400	)
ZFS Finance USA Trust V, 6.50% Jr. Sub. Bonds, 5/9/37		2/24/11-7/26/11		517,024		464,265		(52,759	)
			$	6,470,430	$	3,393,259	$	(3,077,171	)

4.	This security is not accruing income because the issuer has missed an interest payment on it and/or is not anticipated to make future interest and/or principal payments. The rate shown is the original contractual interest rate. See Note 1 of the accompanying Notes.
5.	When-issued security or delayed delivery to be delivered and settled after December 30, 2011. See Note 1 of the accompanying Notes.
6.	Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans or other receivables. 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 or asset-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. These securities amount to $5,329,467 or 2.89% of the Fund’s net assets as of December 30, 2011.
7.	Principal-Only Strips represent the right to receive the monthly principal payments on an underlying pool of mortgage loans. The value of these securities generally increases as interest rates decline and prepayment rates rise. The price of these securities is typically more volatile than that of coupon-bearing bonds of the same maturity. Interest rates disclosed represent current yields based upon the current cost basis and estimated timing of future cash flows. These securities amount to $320,380 or 0.17% of the Fund’s net assets as of December 30, 2011.
8.	The current amortization rate of the security’s cost basis exceeds the future interest payments currently estimated to be received. Both the amortization rate and interest payments are contingent on future mortgage pre-payment speeds and are therefore subject to change.
9.	All or a portion of the security position is held in collateralized accounts to cover initial margin requirements on open futures contracts and written options on futures, if applicable. The aggregate market value of such securities is $513,160. See Note 5 of the accompanying Notes.
10.	This bond has no contractual maturity date, is not redeemable and contractually pays an indefinite stream of interest. Rate reported represents the current interest rate for this variable rate security.
11.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31,2010		Additions		Reductions		December 30,2011
Oppenheimer Institutional Money Market Fund, Cl. E		25,899,825		93,303,874		90,883,726		28,319,973

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	28,319,973	$	57,584

12. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

19 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

						Level 3–
	Level 1–			Level 2–		Significant
	Unadjusted			Other Significant		Unobservable
	Quoted Prices			Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Asset-Backed Securities	$	—		$	18,922,092	$	—	$	18,922,092
Mortgage-Backed Obligations		—			126,696,697		—		126,696,697
U.S. Government Obligations		—			3,142,650		—		3,142,650
Corporate Bonds and Notes		—			78,338,108		—		78,338,108
Investment Company		28,319,973			—		—		28,319,973
Total Investments, at Value		28,319,973			227,099,547		—		255,419,520
Other Financial Instruments:
Futures margins		50,877			—		—		50,877
Total Assets	$	28,370,850		$	227,099,547	$	—	$	255,470,397
Liabilities Table
Other Financial Instruments:
Futures margins	$	(25,518	)	$	—	$	—	$	(25,518	)
Total Liabilities	$	(25,518	)	$	—	$	—	$	(25,518	)

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

Futures Contracts as of December 30, 2011 are as follows:

								Unrealized
		Number of		Expiration				Appreciation
Contract Description	Buy/Sell	Contracts		Date		Value		(Depreciation)
U.S. Long Bonds	Buy		45		3/21/12	$	6,516,563	$	70,811
U.S. Treasury Nts., 2 yr.	Sell		110		3/30/12		24,260,156		(5,569	)
U.S. Treasury Nts., 5 yr.	Sell		79		3/30/12		9,737,367		(37,808	)
U.S. Treasury Nts., 10 yr.	Buy		11		3/21/12		1,442,375		6,347
U.S. Treasury Ultra Bonds	Buy		54		3/21/12		8,650,125		52,435
								$	86,216

See accompanying Notes to Financial Statements.

20 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $225,942,991)	$	227,099,547
Affiliated companies (cost $28,319,973)		28,319,973
		255,419,520
Cash		78,759
Receivables and other assets:
Investments sold on a when-issued or delayed delivery basis		1,815,274
Interest, dividends and principal paydowns		1,479,073
Shares of beneficial interest sold		1,270,462
Futures margins		50,877
Other		46,178
Total assets		260,160,143
Liabilities
Payables and other liabilities:
Investments purchased on a when-issued or delayed delivery basis		75,414,943
Shareholder communications		52,011
Futures margins		25,518
Shares of beneficial interest redeemed		18,977
Trustees’ compensation		16,770
Transfer and shareholder servicing agent fees		15,453
Distribution and service plan fees		12,568
Other		38,605
Total liabilities		75,594,845
Net Assets	$	184,565,298
Composition of Net Assets
Par value of shares of beneficial interest	$	23,514
Additional paid-in capital		264,231,050
Accumulated net investment income		8,902,644
Accumulated net realized loss on investments		(89,834,682	)
Net unrealized appreciation on investments		1,242,772
Net Assets	$	184,565,298
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $122,271,102 and 15,520,149 shares of beneficial interest outstanding)	$	7.88
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $62,294,196 and 7,993,566 shares of beneficial interest outstanding)	$	7.79

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

21 | OPPENHEIMER CORE BOND FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Interest	$	8,013,498
Dividends from affiliated companies		57,584
Fee income on when-issued securities		2,053,668
Total investment income		10,124,750
Expenses
Management fees		1,115,919
Distribution and service plan fees—Service shares		146,541
Transfer and shareholder servicing agent fees:
Non-Service shares		127,352
Service shares		58,632
Shareholder communications:
Non-Service shares		34,078
Service shares		15,296
Custodian fees and expenses		20,464
Trustees’ compensation		14,794
Administration service fees		1,500
Other		50,062
Total expenses		1,584,638
Less waivers and reimbursements of expenses		(43,913	)
Net expenses		1,540,725
Net Investment Income		8,584,025
Realized and Unrealized Gain (Loss)
Net realized gain on:
Investments from unaffiliated companies		4,215,975
Closing and expiration of futures contracts		2,940,895
Net realized gain		7,156,870
Net change in unrealized appreciation/depreciation on:
Investments		(1,183,198	)
Futures contracts		71,994
Net change in unrealized appreciation/depreciation		(1,111,204	)
Net Increase in Net Assets Resulting from Operations	$	14,629,691

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

22 | OPPENHEIMER CORE BOND FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	8,584,025		$	10,146,680
Net realized gain		7,156,870			8,147,844
Net change in unrealized appreciation/depreciation		(1,111,204	)		2,718,458
Net increase in net assets resulting from operations		14,629,691			21,012,982
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(7,632,636	)		(2,543,053	)
Service shares		(3,102,242	)		(932,463	)
		(10,734,878	)		(3,475,516	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		(12,784,495	)		(17,432,675	)
Service shares		4,335,577			(5,299,305	)
		(8,448,918	)		(22,731,980	)
Net Assets
Total decrease		(4,554,105	)		(5,194,514	)
Beginning of period		189,119,403			194,313,917
End of period (including accumulated net investment income of $8,902,644 and $10,595,621, respectively)	$	184,565,298		$	189,119,403

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

23 | OPPENHEIMER CORE BOND FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	7.73		$	7.07		$	6.45		$	11.06		$	11.16
Income (loss) from investment operations:
Net investment income2		.36			.40			.48			.66			.55
Net realized and unrealized gain (loss)		.25			.40			.14			(4.82	)		(.08	)
Total from investment operations		.61			.80			.62			(4.16	)		.47
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.46	)		(.14	)		—			(.45	)		(.57	)
Net asset value, end of period	$	7.88		$	7.73		$	7.07		$	6.45		$	11.06
Total Return, at Net Asset Value3		8.27	%		11.42	%		9.61	%		(39.05	)%		4.39	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	122,271		$	132,557		$	137,597		$	156,339		$	325,661
Average net assets (in thousands)	$	127,341		$	136,333		$	137,631		$	271,355		$	345,723
Ratios to average net assets:4
Net investment income		4.71	%		5.32	%		7.40	%		6.76	%		5.07	%
Total expenses5		0.77	%		0.79	%		0.75	%		0.63	%		0.68	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.75	%		0.70	%		0.61	%		0.62	%		0.68	%
Portfolio turnover rate6		99	%		98	%		143	%		51	%		89	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.79	%
Year Ended December 31, 2010	0.80	%
Year Ended December 31, 2009	0.76	%
Year Ended December 31, 2008	0.63	%
Year Ended December 31, 2007	0.68	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	911,850,847	$	909,531,196
Year Ended December 31, 2010	$	775,240,942	$	766,486,357
Year Ended December 31, 2009	$	977,840,247	$	1,009,549,121
Year Ended December 31, 2008	$	1,019,711,829	$	963,377,934
Year Ended December 31, 2007	$	662,784,931	$	678,316,693

See accompanying Notes to Financial Statements.

24 | OPPENHEIMER CORE BOND FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	7.65		$	6.99		$	6.41		$	10.98		$	11.10
Income (loss) from investment operations:
Net investment income2		.34			.37			.46			.63			.52
Net realized and unrealized gain (loss)		.24			.41			.12			(4.77	)		(.08	)
Total from investment operations		.58			.78			.58			(4.14	)		.44
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.44	)		(.12	)		—			(.43	)		(.56	)
Net asset value, end of period	$	7.79		$	7.65		$	6.99		$	6.41		$	10.98
Total Return, at Net Asset Value3		7.93	%		11.28	%		9.05	%		(39.07	)%		4.09	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	62,294		$	56,562		$	56,717		$	63,093		$	103,542
Average net assets (in thousands)	$	58,629		$	57,313		$	52,648		$	101,597		$	70,116
Ratios to average net assets:4
Net investment income		4.42	%		5.06	%		7.16	%		6.55	%		4.85	%
Total expenses5		1.02	%		1.04	%		1.01	%		0.88	%		0.92	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.00	%		0.95	%		0.86	%		0.87	%		0.92	%
Portfolio turnover rate6		99	%		98	%		143	%		51	%		89	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.04	%
Year Ended December 31, 2010	1.05	%
Year Ended December 31, 2009	1.02	%
Year Ended December 31, 2008	0.88	%
Year Ended December 31, 2007	0.92	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	911,850,847	$	909,531,196
Year Ended December 31, 2010	$	775,240,942	$	766,486,357
Year Ended December 31, 2009	$	977,840,247	$	1,009,549,121
Year Ended December 31, 2008	$	1,019,711,829	$	963,377,934
Year Ended December 31, 2007	$	662,784,931	$	678,316,693

See accompanying Notes to Financial Statements.

25 | OPPENHEIMER CORE BOND FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Core Bond Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s main investment objective is to seek a high level of current income. As a secondary objective, the Fund seeks capital appreciation when consistent with its primary objective. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

26 | OPPENHEIMER CORE BOND FUND/VA

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Securities on a When-Issued or Delayed Delivery Basis. The Fund may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis normally takes place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of the Fund’s net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. When the Fund engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain or dispose of the security at a price and yield it considers advantageous. The Fund may also sell securities that it purchased on a when-issued basis or forward commitment prior to settlement of the original purchase.

As of December 30, 2011, the Fund had purchased securities issued on a when-issued or delayed delivery basis and sold securities issued on a delayed delivery basis as follows:

	When-Issued or Delayed
	Delivery Basis Transactions
Purchased securities	$	75,414,943
Sold securities		1,815,274

The Fund may enter into “forward roll” transactions with respect to mortgage-related securities. In this type of transaction, the Fund sells a mortgage-related security to a buyer and simultaneously agrees to repurchase a similar security (same type, coupon and maturity) at a later date at a set price. During the period between the sale and the repurchase, the Fund will not be entitled to receive interest and principal payments on the securities that have been sold. The Fund records the incremental difference between the forward purchase and sale of each forward roll as realized gain (loss) on investments or as fee income in the case of such transactions that have an associated fee in lieu of a difference in the forward purchase and sale price.

     Forward roll transactions may be deemed to entail embedded leverage since the Fund purchases mortgage-related securities with extended settlement dates rather than paying for the securities under a normal settlement cycle. This embedded leverage increases the Fund’s market value of investments relative to its net assets which can incrementally increase the volatility of the Fund’s performance. Forward roll transactions can be replicated over multiple settlement periods.

     Risks of entering into forward roll transactions include the potential inability of the counterparty to meet the terms of the agreement; the potential of the Fund to receive inferior securities at redelivery as compared to the securities sold to the counterparty; and counterparty credit risk.

27 | OPPENHEIMER CORE BOND FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Credit Risk. The Fund invests in high-yield, non-investment-grade bonds, which may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Fund may acquire securities that have missed an interest payment, and is not obligated to dispose of securities whose issuers or underlying obligors subsequently miss an interest payment. Information concerning securities not accruing interest as of December 30, 2011 is as follows:

Cost	$	3,281,116
Market Value	$	303,301
Market Value as a % of Net Assets		0.16	%

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Appreciation Based on
Undistributed					Cost of Securities and
Net Investment	Undistributed		Accumulated Loss		Other Investments for
Income	Long-Term Gain		Carryforward1,2,3		Federal Income Tax Purposes
$9,181,275	$	—	$	89,702,948	$	1,097,897

1. As of December 30, 2011, the Fund had $89,702,948 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2014	$	609,788
2015		1,245,459
2016		12,777,851
2017		75,069,850
Total	$	89,702,948

2.	During the fiscal year ended December 30, 2011, the Fund utilized $5,723,749 of capital loss carryforward to offset capital gains realized in that fiscal year.
3.	During the fiscal year ended December 31, 2010, the Fund utilized $8,990,701 of capital loss carryforward to offset capital gains realized in that fiscal year.

28 | OPPENHEIMER CORE BOND FUND/VA

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Increase to
Increase to	Accumulated Net
Accumulated Net	Realized Loss
Investment Income	on Investments
$457,876	$	457,876

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	10,734,878	$	3,475,516

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	254,321,623
Federal tax cost of other investments		(17,388,462	)
Total federal tax cost	$	236,933,161
Gross unrealized appreciation	$	7,268,695
Gross unrealized depreciation		(6,170,798	)
Net unrealized appreciation	$	1,097,897

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

29 | OPPENHEIMER CORE BOND FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		1,525,561		$	11,724,677			1,228,005		$	9,215,341
Dividends and/or distributions reinvested		1,028,657			7,632,636			357,672			2,543,053
Redeemed		(4,179,877	)		(32,141,808	)		(3,913,294	)		(29,191,069	)
Net decrease		(1,625,659	)	$	(12,784,495	)		(2,327,617	)	$	(17,432,675	)
Service Shares
Sold		2,658,754		$	20,149,296			1,784,838		$	13,294,523
Dividends and/or distributions reinvested		422,074			3,102,242			132,264			932,463
Redeemed		(2,480,364	)		(18,915,961	)		(2,632,411	)		(19,526,291	)
Net increase (decrease)		600,464		$	4,335,577			(715,309	)	$	(5,299,305	)

30 | OPPENHEIMER CORE BOND FUND/VA

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	130,891,879	$	132,306,983
U.S. government and government agency obligations		1,812,430		1,894,880
To Be Announced (TBA) mortgage-related securities		911,850,847		909,531,196

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $1 billion	0.60	%
Over $1 billion	0.50

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $186,542 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.75% for Non-Service shares and 1.00% for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $7,170 and $3,043 for Non-Service and Service shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $33,700 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to

31 | OPPENHEIMER CORE BOND FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

32 | OPPENHEIMER CORE BOND FUND/VA

Valuations of derivative instruments as of December 30, 2011 are as follows:

	Asset Derivatives		Liability Derivatives
	Statement		Statement
Derivatives Not	of Assets		of Assets
Accounted for as	and Liabilities		and Liabilities
Hedging Instruments	Location	Value	Location	Value
Interest rate contracts	Futures margins	$50,877*	Futures margins	$25,518*

* Includes only the current day’s variation margin. Prior variation margin movements have been reflected in cash on the Statement of Assets and Liabilities upon receipt or payment.

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not	Closing and
Accounted for as	expiration of
Hedging Instruments	futures contracts
Interest rate contracts	$	2,940,895

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
Derivatives Not
Accounted for as
Hedging Instruments	Futures contracts
Interest rate contracts	$	71,994

Futures Contracts

A futures contract is a commitment to buy or sell a specific amount of a financial instrument, or currency, at a negotiated price on a stipulated future date. The Fund may buy and sell futures contracts and may also buy or write put or call options on these futures contracts.

     Futures contracts traded on a commodities or futures exchange will be valued at the final settlement price or official closing price on the principal exchange as reported by such principal exchange at its trading session ending at, or most recently prior to, the time when the Fund’s assets are valued.

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

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

     The Fund has purchased futures contracts on various bonds and notes to increase exposure to interest rate risk. The Fund has sold futures contracts on various bonds and notes to decrease exposure to interest rate risk.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $17,763,413 and $34,052,790 on futures contracts purchased and sold, respectively.

     Additional associated risks of entering into futures contracts (and related options) include the possibility that there may be an illiquid market where the Fund is unable to liquidate the contract or enter into an offsetting position and, if used for hedging purposes, the risk that the price of the contract will correlate imperfectly with the prices of the Fund’s securities.

33 | OPPENHEIMER CORE BOND FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

6. Restricted Securities

As of December 30, 2011, investments in securities included issues that are restricted. A restricted security may have a contractual restriction on its resale and is valued under methods approved by the Board of Trustees as reflecting fair value. Securities that are restricted are marked with an applicable footnote on the Statement of Investments. Restricted securities are reported on a schedule following the Statement of Investments.

7. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

34 | OPPENHEIMER CORE BOND FUND/VA

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

35 | OPPENHEIMER CORE BOND FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Core Bond Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Core Bond Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Core Bond Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

36 | OPPENHEIMER CORE BOND FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

37 | OPPENHEIMER CORE BOND FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT
ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Krishna Memani and Peter Strzalkowski, the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other A-rated corporate debt funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-year Lipper period, although it underperformed its performance universe median during the three-, five-, and ten-year Lipper periods. The Board also considered the appointment of a new portfolio manager on

38 | OPPENHEIMER CORE BOND FUND/VA

April 1, 2009, and it considered the Manager’s assertion that the Investment Grade Fixed Income Team has been repositioning the portfolio gradually to better take advantage of changing market conditions. The Board considered the Fund’s recent improved performance in light of those changes, ranking in the first quintile for the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other A-rated corporate debt funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s total expenses and actual management fees were higher than its expense group median. The Board considered that the Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed that annual rate of 0.75% for Non-Service shares and 1.00% for Service shares. This voluntary expense limitation may not be amended or withdrawn until one year after the date of the prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates. The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

39 | OPPENHEIMER CORE BOND FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies (“portfolio proxies”) relating to securities held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Fund’s Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

40 | OPPENHEIMER CORE BOND FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following:
	UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and

41 | OPPENHEIMER CORE BOND FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Beverly L. Hamilton, Continued	Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281- 1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005- December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

42 | OPPENHEIMER CORE BOND FUND/VA

OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Memani, Strzalkowski, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Krishna Memani, Vice President (since 2009) Age: 51	Director of Fixed Income (since October 2010), Senior Vice President and Head of the Investment Grade Fixed Income Team of the Manager (since March 2009). Prior to joining the Manager, Managing Director and Head of the U.S. and European Credit Analyst Team at Deutsche Bank Securities (June 2006-January 2009); Chief Credit Strategist at Credit Suisse Securities (August 2002-March 2006); a Managing Director and Senior Portfolio Manager at Putnam Investments (September 1998-June 2002). A portfolio manager and an officer of 22 portfolios in the OppenheimerFunds complex.
Peter A. Strzalkowski, Vice President (since 2009) Age: 46	Vice President of the Manager (since August 2007), a Chartered Financial Analyst and a member of the Manager’s Investment Grade Fixed Income Team (since April 2009). Prior to joining the Manager, Managing Partner and Chief Investment Officer of Vector Capital Management, LLC, a structured products money management firm he founded, (July 2006-August 2007); a Senior Portfolio Manager at Highland Capital Management, L.P. (June 2005-July 2006) and a Senior Fixed Income Portfolio Manager at Microsoft Corp. (June 2003-June 2005); a Vice President and Senior Fixed Income Portfolio Manager at First Citizens Bank Trust, Capital Management Group (April 2000-June 2003); a Vice President and Fixed Income Portfolio Manager at Centura Banks (November 1998-April 2000). A portfolio manager and officer of 7 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003- October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

43 | OPPENHEIMER CORE BOND FUND/VA

OPPENHEIMER CORE BOND FUND/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011 Annual Report ANNUAL REPORT Listing of Top Holdings Fund Performance Discussion Financial Statements

OPPENHEIMER GLOBAL SECURITIES FUND/VA

Portfolio Manager: Rajeev Bhaman, CFA

Average Annual Total Returns
For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Share		-8.29	%		-1.12	%		5.37	%
Service Shares		-8.53	%		-1.36	%		5.12	%

							Since
							Inception
	1-Year			5-Year			(5/1/03)
Class 3		-8.27	%		-1.12	%	9.39	%

							Since
							Inception
	1-Year			5-Year			(5/3/04)
Class 4		-8.49	%		-1.37	%	5.02	%

Expense Ratios
For the Period Ended 12/30/111
Non-Service Shares	0.76	%
Service Shares	1.01
Class 3	0.76
Class 4	1.01

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

Regional Allocation

Portfolio holdings and allocations are subject to change.
Percentages are as of December 30, 2011, and are based on the total market value of investments.

Top Ten Common Stock Holdings

Telefonaktiebolaget LM Ericsson, B Shares	3.9	%
eBay, Inc.	3.1
Siemens AG	2.6
McDonald’s Corp.	2.2
Altera Corp.	2.2
Intuit, Inc.	2.1
SAP AG	2.0
European Aeronautic Defense & Space Co.	1.9
Aetna, Inc.	1.9
Colgate-Palmolive Co.	1.8

Portfolio holdings and allocations are subject to change.
Percentages are as of December 30, 2011, and are based on net assets.

     2 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares declined by 8.29% for the one-year reporting period ended December 30, 2011.¹ On a relative basis, the Fund underperformed the MSCI World Index (the “Index”), which declined by 5.54%. The Fund’s losses occurred over the third quarter of 2011. The global decline in financial markets over the third quarter was triggered by default expectations in Greece spreading to Portugal, Ireland, Spain and even Italy as European policy makers squabbled over who would bear the costs of deteriorating asset quality on bank balance sheets. During this time, the markets moved from favoring riskier asset classes to historically defensive securities. The Fund is invested primarily in stocks with growth characteristics, which tend not to perform well in this type of environment. Furthermore, the Fund had more investments in European and emerging market-based companies than the Index, which led to the underperformance due to worries about the euro and emerging market growth.

Global Market and Economic Environment

The past year has been a tale of many markets. Political unrest in the Middle East with the advent of the “Arab Spring” saw dictators and their governments in North Africa fall. A giant earthquake in Japan and the resulting tsunami caused devastation and a nuclear crisis in the Tohoku region. Ratings agency Standard & Poor’s downgraded the U.S. below AAA. Inflation in China and India reached levels that were deemed too high for central banks there and they tightened monetary policy. Europe and the euro looked wobbly with an untenable situation in Greece and increasing worries over the abilities of Portugal, Ireland, Spain and Italy to pay their debts.

     These events led to significant disruptions to global supply chains and concerns over the supply and availability of oil. Oil prices rose unrelentingly through April. The perceived unwillingness of the broader European Community to come together to resolve the European debt crisis created undesirable risk for investors. Economies such as Germany appeared willing to employ a stratagem of brinksmanship to attempt to push debt-laden European countries to make hard political decisions. With hopes that emerging markets would lead the world through a difficult patch, concerns about global growth arose when major emerging markets tightened monetary policy. Unemployment rates have remained stubbornly high as companies make do with fewer workers.

     It seemed all of these concerns reached a crescendo over the summer, leading to a major reversal in the uptrend of the markets we had seen until then. Worries about a global recession dominated the markets and a flight to safety ensued. Despite all this, many companies reported robust financial results that beat expectations. Company balance sheets outside of the financials sector generally remained strong and borrowing costs remained low.

     Equity markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life, as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved. Developing markets generally saw equity gains in the fourth quarter, but their performance continued to lag behind that of the developed markets. A decisive shift toward easier monetary policy in China and an interest rate cut by Brazil in late November for the third time since August stimulated large gains in euro zone bond markets, as yields fell in almost every country in the Eurozone and also sparked a rally in the global equity markets.

Top Individual Contributors

During the reporting period, top contributors to Fund performance included global fast-food retailer McDonald’s Corp., health care provider Aetna, Inc., European Aeronautic Defence & Space Co. (EADS), parent of Airbus, and the jeweler, Bulgari SpA. McDonald’s, the iconic American quick service restaurant, continued to grow globally and increase market share. The company also continued to benefit from the popularity of its McCafe beverage line-up, its breakfast offerings and its premium chicken sandwiches. Aetna, a leading managed health care firm based in the U.S., performed well as earnings grew faster than market expectations. EADS, the maker of Airbus airplanes and the

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

     3 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FUND PERFORMANCE DISCUSSION

Eurocopter among other defense related products, grew its order book at a record pace and showed rapidly improving profit margins.

     Bulgari SpA is an Italian jeweler and one of our luxury goods holdings that was taken over by LVMH, the owner of Luis Vuitton, another one of our holdings, at a substantial premium. Over the year, we also initiated major investments in Google, Inc. and McGraw Hill-Cos., two superb franchise businesses that we believed to be undervalued. Both of these holdings performed positively for the Fund while held.

Top Individual Detractors

Individual securities that were significant detractors included the Swiss bank Credit Suisse Group AG, a leading franchise in private banking worldwide with a very healthy balance sheet, in our opinion. The ultra-strength of the Swiss franc combined with significant risk aversion in the marketplace resulted in an increase in the firm’s costs combined with a decrease in customer revenues, which led to significant profit declines. Financial services giant Goldman Sachs Group, Inc. also detracted from performance. Goldman’s stock price declined primarily due to increased regulation in the financial industry and uncertainty over its eventual implementation, which reduced the outlook for profit growth for many financial firms, particularly in the investment banking sector. A weak global economy and investment banks’ exposure to the Eurozone also gave investors pause. Sony Corp., a legendary consumer electronics franchise, was battered by the global consumers’ unwillingness to buy televisions or other appliances. We continued to hold these companies in our portfolio, notwithstanding these short-term setbacks.

Outlook

We remain confident that our method of investment, which focuses on companies of high quality positioned to capitalize on growth trends and purchased at prices that offer the opportunity to substantially appreciate over a five year investment horizon, will serve us well in the periods to come. Our positioning in the Fund is similar to what it was a year ago. The world’s current concerns are real but the overwhelming focus on these concerns, and an ignoring of the potential in the markets, provides us great opportunities. In a world where the leading companies can have dividend yields higher than their own bond yields and cash flow yields double that, investing in stocks may provide uncommon opportunities.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. In the case of Non-Service shares and Service shares, performance is measured over a ten-fiscal-year period. In the case of Class 3 shares, performance is measured from inception of the class on May 1, 2003. In the case of Class 4 shares, performance is measured from inception of the class on May 3, 2004. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     4 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

     The Fund’s performance is compared to the performance of the Morgan Stanley Capital International (MSCI) World Index, an unmanaged index of equity securities listed on stock exchanges of a select number of foreign countries and the U.S. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

     5 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

     6 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

Class 3 Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

Class 4 Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

     7 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

     8 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
Actual	July 1, 2011		December 30, 2011		December 30, 2011
Non-Service shares	$	1,000.00	$	852.80	$	3.54
Service shares		1,000.00		851.60		4.70
Class 3		1,000.00		852.90		3.54
Class 4		1,000.00		851.60		4.70
Hypothetical
(5% return before expenses)
Non-Service shares		1,000.00		1,021.26		3.86
Service shares		1,000.00		1,020.00		5.13
Class 3		1,000.00		1,021.26		3.86
Class 4		1,000.00		1,020.00		5.13

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.76	%
Service shares		1.01
Class 3		0.76
Class 4		1.01

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

     9 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—98.3%
Consumer Discretionary—18.1%
Automobiles—1.5%
Bayerische Motoren Werke (BMW) AG, Preference		771,969	$	36,517,785
Diversified Consumer Services—0.0%
Zee Learn Ltd.1		492,103		110,273
Hotels, Restaurants & Leisure—4.1%
Carnival Corp.		1,124,146		36,692,125
Lottomatica SpA1		552,870		8,273,787
McDonald’s Corp.		529,050		53,079,587
				98,045,499
Household Durables—0.6%
Sony Corp.		759,800		13,693,158
Leisure Equipment & Products—0.3%
Nintendo Co. Ltd.		61,000		8,400,676
Media—4.5%
Grupo Televisa SA, Sponsored GDR		1,333,226		28,077,740
McGraw-Hill Cos., Inc. (The)		634,460		28,531,666
Walt Disney Co. (The)		1,102,240		41,334,000
Wire & Wireless India Ltd.1		2,281,600		255,635
Zee Entertainment Enterprises Ltd.		4,094,715		9,086,944
				107,285,985
Multiline Retail—0.9%
Pinault-Printemps-Redoute SA		146,730		21,012,974
Specialty Retail—3.8%
Abercrombie & Fitch Co., Cl. A		87,250		4,261,290
Industria de Diseno Textil SA		439,965		36,033,114
Kingfisher plc		1,924,960		7,494,525
Tiffany & Co.		650,960		43,132,610
				90,921,539
Textiles, Apparel & Luxury Goods—2.4%
LVMH Moet Hennessy Louis Vuitton SA		281,770		39,698,068
Tod’s SpA		227,470		18,497,140
				58,195,208
Consumer Staples—9.5%
Beverages—4.2%
Carlsberg AS, Cl. B		199,346		14,057,272
Companhia de Bebidas das Americas, Sponsored ADR, Preference		865,575		31,238,602
Fomento Economico Mexicano SA de CV, UBD		5,543,613		38,744,550
Grupo Modelo SA de CV, Series C		2,376,754		14,988,094
				99,028,518
Food & Staples Retailing—0.6%
E-Mart Co. Ltd.1		61,139		14,807,102
Food Products—2.9%
Nestle SA		522,946		30,063,967
Unilever plc		1,159,843		38,960,436
				69,024,403
Household Products—1.8%
Colgate-Palmolive Co.		475,810		43,960,086
Energy—3.9%
Energy Equipment & Services—2.5%
Technip SA		419,990		39,253,414
Transocean Ltd.		505,762		19,416,203
				58,669,617
Oil, Gas & Consumable Fuels—1.4%
Total SA		548,830		28,057,704
YPF Sociedad Anonima SA, Sponsored ADR		166,670		5,780,116
				33,837,820
Financials—13.8%
Capital Markets—3.6%
Credit Suisse Group AG		1,254,268		29,470,558
Goldman Sachs Group, Inc. (The)		259,310		23,449,403
UBS AG1		2,716,046		32,327,685
				85,247,646
Commercial Banks—2.7%
Banco Bilbao Vizcaya Argentaria SA		3,367,795		28,945,218
Itau Unibanco Holding SA, ADR,
Preference		578,240		10,732,134
Societe Generale SA, Cl. A		290,239		6,441,556
Sumitomo Mitsui Financial
Group, Inc.		655,000		18,245,031
				64,363,939
Diversified Financial Services—1.9%
BM&F BOVESPA SA		4,348,400		22,846,439
Investor AB, B Shares		1,276,082		23,712,306
				46,558,745
Insurance—5.3%
Aflac, Inc.		482,310		20,864,731
Allianz SE		324,402		31,031,582
Dai-ichi Life Insurance Co.		21,622		21,265,238
Fidelity National Financial, Inc., Cl. A		821,110		13,080,282
Prudential plc		2,651,717		26,128,476
XL Group plc		709,690		14,030,571
				126,400,880

10 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

	Shares		Value
Real Estate Management & Development—0.3%
DLF Ltd.		2,418,376	$	8,312,929
Health Care—10.3%
Biotechnology—2.5%
Amgen, Inc.		353,590		22,704,014
Amylin Pharmaceuticals, Inc.1		1,101,708		12,537,437
Gilead Sciences, Inc.1		299,030		12,239,298
Theravance, Inc.1		598,130		13,218,673
				60,699,422
Health Care Equipment & Supplies—1.2%
Zimmer Holdings, Inc.1		552,170		29,496,921
Health Care Providers & Services—3.7%
Aetna, Inc.		1,057,270		44,606,221
WellPoint, Inc.		657,315		43,547,119
				88,153,340
Pharmaceuticals—2.9%
Allergan, Inc.		104,180		9,140,753
Bayer AG		444,545		28,422,343
Mitsubishi Tanabe Pharma Corp.		826,300		13,075,658
Roche Holding AG		104,226		17,665,048
				68,303,802
Industrials—12.2%
Aerospace & Defense—2.8%
Embraer SA, ADR		903,943		22,797,442
European Aeronautic Defense & Space Co.		1,452,460		45,187,675
				67,985,117
Building Products—1.6%
Assa Abloy AB, Cl. B		1,514,863		37,992,365
Commercial Services & Supplies—0.2%
Mulitplus SA		253,800		4,388,179
Electrical Equipment—2.0%
Emerson Electric Co.		461,440		21,498,490
Nidec Corp.		208,300		18,104,807
Prysmian SpA		683,137		8,442,341
				48,045,638
Industrial Conglomerates—4.7%
3M Co.		397,600		32,495,848
Koninklijke Philips Electronics NV		850,531		17,823,292
Siemens AG		653,062		62,495,832
				112,814,972
Machinery—0.7%
Fanuc Ltd.		115,300		17,646,278
Road & Rail—0.2%
All America Latina Logistica		732,200		3,650,696
Information Technology—27.7%
Communications Equipment—5.0%
Juniper Networks, Inc.1		1,264,000		25,798,240
Telefonaktiebolaget LM Ericsson, B Shares		9,267,681		94,139,824
				119,938,064
Electronic Equipment & Instruments—4.1%
Corning, Inc.		1,391,750		18,064,915
Hoya Corp.		686,800		14,794,263
Keyence Corp.		99,374		23,962,342
Kyocera Corp.		172,300		13,856,529
Murata Manufacturing Co. Ltd.		553,500		28,440,854
				99,118,903
Internet Software & Services—4.5%
eBay, Inc.1		2,487,240		75,437,989
Google, Inc., Cl. A1		50,320		32,501,688
				107,939,677
IT Services—2.2%
Automatic Data Processing, Inc.		430,640		23,258,866
Infosys Ltd.		557,544		29,057,276
				52,316,142
Semiconductors & Semiconductor Equipment—5.0%
Altera Corp.		1,430,470		53,070,437
Maxim Integrated Products, Inc.		1,475,275		38,416,161
Taiwan Semiconductor Manufacturing Co. Ltd.		11,696,184		29,280,054
				120,766,652
Software—6.9%
Adobe Systems, Inc.1		1,012,583		28,625,721
Intuit, Inc.		960,780		50,527,420
Microsoft Corp.		1,430,270		37,129,809
SAP AG		918,335		48,552,365
				164,835,315
Materials—0.8%
Chemicals—0.8%
Linde AG		125,495		18,670,356

11 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares			Value
Telecommunication Services—1.3%
Wireless Telecommunication Services—1.3%
KDDI Corp.		4,861		$	31,261,466
Utilities—0.7%
Electric Utilities—0.7%
Fortum OYJ		809,831			17,229,805
Total Common Stocks (Cost $1,934,470,323)					2,355,647,892
Investment Company—1.5%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%2,3 (Cost $36,459,796)		36,459,796			36,459,796
Total Investments, at Value (Cost $1,970,930,119)		99.8	%		2,392,107,688
Other Assets
Net of Liabilities		0.2			3,684,164
Net Assets		100.0	%	$	2,395,791,852

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Non-income producing security.
2.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		32,313,050		286,291,896		282,145,150		36,459,796

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	36,459,796	$	47,412

3. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3—
	Level 1—		Level 2—		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	354,020,944	$	80,162,153	$	—	$	434,183,097
Consumer Staples		226,820,109		—		—		226,820,109
Energy		53,254,023		39,253,414		—		92,507,437
Financials		237,343,654		93,540,485		—		330,884,139
Health Care		246,653,485		—		—		246,653,485
Industrials		221,069,937		71,453,308		—		292,523,245
Information Technology		570,774,929		94,139,824		—		664,914,753
Materials		18,670,356		—		—		18,670,356
Telecommunication Services		31,261,466		—		—		31,261,466
Utilities		—		17,229,805		—		17,229,805
Investment Company		36,459,796		—		—		36,459,796
Total Assets	$	1,996,328,699	$	395,778,989	$	—	$	2,392,107,688

12 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

The table below shows the significant transfers between Level 1 and Level 2. The Fund’s policy is to recognize transfers in and transfers out as of the beginning of the reporting period.

	Transfers out			Transfers into
	of Level 1*			Level 2*
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	(130,855,018	)	$	130,855,018
Energy		(38,067,652	)		38,067,652
Financials		(104,693,932	)		104,693,932
Industrials		(79,427,212	)		79,427,212
Total Assets	$	(353,043,814	)	$	353,043,814

* Transferred from Level 1 to Level 2 because of the absence of a readily available unadjusted quoted market price due to a significant event occurring before the Fund’s assets were valued but after the close of the securities’ respective exchanges.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

Distribution of investments representing geographic holdings, as a percentage of total investments at value, is as follows:

Geographic Holdings	Value		Percent
United States	$	988,577,799		41.3	%
Germany		225,690,263		9.4
Japan		222,746,300		9.3
France		179,651,391		7.5
Sweden		155,844,495		6.5
Switzerland		109,527,258		4.6
Brazil		95,653,492		4.0
Mexico		81,810,384		3.4
United Kingdom		72,583,437		3.0
Spain		64,978,332		2.7
India		46,823,057		2.0
Italy		35,213,268		1.5
Taiwan		29,280,054		1.2
The Netherlands		17,823,292		0.8
Finland		17,229,805		0.7
Korea, Republic of South		14,807,102		0.6
Denmark		14,057,272		0.6
Ireland		14,030,571		0.6
Argentina		5,780,116		0.3
Total	$	2,392,107,688		100.0	%

See accompanying Notes to Financial Statements.

13 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $1,934,470,323)	$	2,355,647,892
Affiliated companies (cost $36,459,796)		36,459,796
		2,392,107,688
Cash		1,183
Receivables and other assets:
Interest and dividends		3,826,892
Investments sold		1,130,602
Shares of beneficial interest sold		875,239
Other		206,193
Total assets		2,398,147,797
Liabilities
Payables and other liabilities:
Shares of beneficial interest redeemed		1,482,555
Shareholder communications		284,355
Distribution and service plan fees		216,755
Transfer and shareholder servicing agent fees		204,876
Trustees’ compensation		54,687
Other		112,717
Total liabilities		2,355,945
Net Assets	$	2,395,791,852
Composition of Net Assets
Par value of shares of beneficial interest	$	87,548
Additional paid-in capital		1,980,631,676
Accumulated net investment income		46,346,747
Accumulated net realized loss on investments and foreign currency transactions		(52,649,142	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		421,375,023
Net Assets	$	2,395,791,852
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $1,165,140,987 and 42,424,056 shares of beneficial interest outstanding)	$	27.46
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $1,003,838,754 and 36,885,726 shares of beneficial interest outstanding)	$	27.21
Class 3 Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $158,342,670 and 5,726,574 shares of beneficial interest outstanding)	$	27.65
Class 4 Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $68,469,441 and 2,511,586 shares of beneficial interest outstanding)	$	27.26

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

14 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $5,118,609)	$	78,653,007
Affiliated companies		47,412
Interest		1,697
Total investment income		78,702,116
Expenses
Management fees		17,004,569
Distribution and service plan fees:
Service shares		2,728,483
Class 4 shares		196,728
Transfer and shareholder servicing agent fees:
Non-Service shares		1,335,935
Service shares		1,091,567
Class 3 shares		187,877
Class 4 shares		78,686
Shareholder communications:
Non-Service shares		134,206
Service shares		109,469
Class 3 shares		18,868
Class 4 shares		7,880
Custodian fees and expenses		302,416
Trustees’ compensation		54,922
Administration service fees		1,500
Other		100,255
Total expenses		23,353,361
Less waivers and reimbursements of expenses		(27,171	)
Net expenses		23,326,190
Net Investment Income		55,375,926
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments from unaffiliated companies (net of foreign capital gains tax of $58,482)		(43,828,208	)
Foreign currency transactions		38,895,302
Net realized loss		(4,932,906	)
Net change in unrealized appreciation/depreciation on:
Investments (net of foreign capital gains tax of $26,446)		(221,671,448	)
Translation of assets and liabilities denominated in foreign currencies		(44,974,031	)
Net change in unrealized appreciation/depreciation		(266,645,479	)
Net Decrease in Net Assets Resulting from Operations	$	(216,202,459	)

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

15 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Operations
Net investment income	$	55,375,926		$	28,998,191
Net realized gain (loss)		(4,932,906	)		61,465,998
Net change in unrealized appreciation/depreciation		(266,645,479	)		297,995,320
Net increase (decrease) in net assets resulting from operations		(216,202,459	)		388,459,509
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(17,234,287	)		(19,240,136	)
Service shares		(11,357,368	)		(12,039,643	)
Class 3 shares		(2,447,497	)		(2,863,873	)
Class 4 shares		(819,361	)		(934,492	)
		(31,858,513	)		(35,078,144	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		(124,782,917	)		(133,425,702	)
Service shares		5,153,335			(16,572,723	)
Class 3 shares		(27,368,355	)		(29,607,611	)
Class 4 shares		(5,984,377	)		(6,420,742	)
		(152,982,314	)		(186,026,778	)
Net Assets
Total increase (decrease)		(401,043,286	)		167,354,587
Beginning of period		2,796,835,138			2,629,480,551
End of period (including accumulated net investment income of $46,346,747 and $23,680,132, respectively)	$	2,395,791,852		$	2,796,835,138

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

16 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	30.30		$	26.50		$	20.21		$	36.60		$	36.79
Income (loss) from investment operations:
Net investment income2		.65			.33			.33			.55			.45
Net realized and unrealized gain (loss)		(3.11	)		3.85			6.94			(14.46	)		1.69
Total from investment operations		(2.46	)		4.18			7.27			(13.91	)		2.14
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.38	)		(.38	)		(.50	)		(.46	)		(.50	)
Distributions from net realized gain		—			—			(.48	)		(2.02	)		(1.83	)
Total dividends and/or distributions to shareholders		(.38	)		(.38	)		(.98	)		(2.48	)		(2.33	)
Net asset value, end of period	$	27.46		$	30.30		$	26.50		$	20.21		$	36.60
Total Return, at Net Asset Value3		(8.29	)%		15.96	%		39.77	%		(40.19	)%		6.32	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	1,165,141		$	1,410,764		$	1,364,597		$	1,150,113		$	2,193,638
Average net assets (in thousands)	$	1,335,403		$	1,336,110		$	1,206,240		$	1,679,720		$	2,302,726
Ratios to average net assets:4
Net investment income		2.17	%		1.22	%		1.51	%		1.95	%		1.21	%
Total expenses5		0.76	%		0.76	%		0.75	%		0.65	%		0.65	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.76	%		0.76	%		0.75	%		0.65	%		0.65	%
Portfolio turnover rate		13	%		15	%		11	%		19	%		18	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.76	%
Year Ended December 31, 2010	0.76	%
Year Ended December 31, 2009	0.75	%
Year Ended December 31, 2008	0.65	%
Year Ended December 31, 2007	0.65	%

See accompanying Notes to Financial Statements.

17 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FINANCIAL HIGHLIGHTS Continued

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	30.04		$	26.28		$	20.02		$	36.27		$	36.49
Income (loss) from investment operations:
Net investment income2		.56			.26			.27			.47			.33
Net realized and unrealized gain (loss)		(3.08	)		3.82			6.90			(14.32	)		1.72
Total from investment operations		(2.52	)		4.08			7.17			(13.85	)		2.05
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.31	)		(.32	)		(.43	)		(.38	)		(.44	)
Distributions from net realized gain		—			—			(.48	)		(2.02	)		(1.83	)
Total dividends and/or distributions to shareholders		(.31	)		(.32	)		(.91	)		(2.40	)		(2.27	)
Net asset value, end of period	$	27.21		$	30.04		$	26.28		$	20.02		$	36.27
Total Return, at Net Asset Value3		(8.53	)%		15.70	%		39.36	%		(40.33	)%		6.08	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	1,003,839		$	1,101,584		$	980,485		$	772,107		$	1,300,989
Average net assets (in thousands)	$	1,091,128		$	997,627		$	830,887		$	1,051,239		$	1,180,656
Ratios to average net assets:4
Net investment income		1.90	%		0.96	%		1.23	%		1.70	%		0.91	%
Total expenses5		1.01	%		1.01	%		1.00	%		0.90	%		0.89	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.01	%		1.01	%		1.00	%		0.90	%		0.89	%
Portfolio turnover rate		13	%		15	%		11	%		19	%		18	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.01	%
Year Ended December 31, 2010	1.01	%
Year Ended December 31, 2009	1.00	%
Year Ended December 31, 2008	0.90	%
Year Ended December 31, 2007	0.89	%

See accompanying Notes to Financial Statements.

18 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Class 3 Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	30.50		$	26.67		$	20.34		$	36.82		$	36.99
Income (loss) from investment operations:
Net investment income2		.66			.33			.33			.56			.45
Net realized and unrealized gain (loss)		(3.13	)		3.88			6.98			(14.56	)		1.71
Total from investment operations		(2.47	)		4.21			7.31			(14.00	)		2.16
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.38	)		(.38	)		(.50	)		(.46	)		(.50	)
Distributions from net realized gain		—			—			(.48	)		(2.02	)		(1.83	)
Total dividends and/or distributions to shareholders		(.38	)		(.38	)		(.98	)		(2.48	)		(2.33	)
Net asset value, end of period	$	27.65		$	30.50		$	26.67		$	20.34		$	36.82
Total Return, at Net Asset Value3		(8.27	)%		15.97	%		39.70	%		(40.19	)%		6.34	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	158,343		$	202,621		$	206,356		$	175,971		$	361,621
Average net assets (in thousands)	$	187,804		$	196,495		$	182,553		$	269,650		$	391,270
Ratios to average net assets:4
Net investment income		2.17	%		1.22	%		1.49	%		1.95	%		1.22	%
Total expenses5		0.76	%		0.76	%		0.75	%		0.65	%		0.65	%
Expenses after payments, waivers and/or
reimbursements and reduction
to custodian expenses		0.76	%		0.76	%		0.75	%		0.65	%		0.65	%
Portfolio turnover rate		13	%		15	%		11	%		19	%		18	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.76	%
Year Ended December 31, 2010	0.76	%
Year Ended December 31, 2009	0.75	%
Year Ended December 31, 2008	0.65	%
Year Ended December 31, 2007	0.65	%

See accompanying Notes to Financial Statements.

19 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

FINANCIAL HIGHLIGHTS Continued

	Year Ended
	December 30,									Year Ended December 31,
Class 4 Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	30.08		$	26.32		$	20.03		$	36.28		$	36.49
Income (loss) from investment operations:
Net investment income2		.57			.26			.27			.47			.34
Net realized and unrealized gain (loss)		(3.08	)		3.82			6.92			(14.34	)		1.70
Total from investment operations		(2.51	)		4.08			7.19			(13.87	)		2.04
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.31	)		(.32	)		(.42	)		(.36	)		(.42	)
Distributions from net realized gain		—			—			(.48	)		(2.02	)		(1.83	)
Total dividends and/or distributions to shareholders		(.31	)		(.32	)		(.90	)		(2.38	)		(2.25	)
Net asset value, end of period	$	27.26		$	30.08		$	26.32		$	20.03		$	36.28
Total Return, at Net Asset Value3		(8.49	)%		15.67	%		39.38	%		(40.35	)%		6.06	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	68,469		$	81,866		$	78,043		$	63,099		$	123,542
Average net assets (in thousands)	$	78,655		$	76,519		$	66,965		$	93,909		$	122,385
Ratios to average net assets:4
Net investment income		1.93	%		0.97	%		1.22	%		1.69	%		0.93	%
Total expenses5		1.01	%		1.01	%		1.00	%		0.91	%		0.90	%
Expenses after payments, waivers and/or
reimbursements and reduction
to custodian expenses		1.01	%		1.01	%		1.00	%		0.91	%		0.90	%
Portfolio turnover rate		13	%		15	%		11	%		19	%		18	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.01	%
Year Ended December 31, 2010	1.01	%
Year Ended December 31, 2009	1.00	%
Year Ended December 31, 2008	0.91	%
Year Ended December 31, 2007	0.90	%

See accompanying Notes to Financial Statements.

20 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Global Securities Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek long-term capital appreciation by investing a substantial portion of its assets in securities of foreign issuers, “growth-type” companies, cyclical industries and special situations that are considered to have appreciation possibilities. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

     The Fund offers Non-Service, Service, Class 3 and Class 4 shares. All classes are sold at their offering price, which is the net asset value per share, to separate investment accounts of participating insurance companies as an underlying investment for variable life insurance policies, variable annuity contracts or other investment products. The classes of shares being designated as Service shares and Class 4 shares are subject to a distribution and service plan. All classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. The Fund assesses a 1% fee on the proceeds of Class 3 and Class 4 shares that are redeemed (either by selling or exchanging to another Oppenheimer fund or other investment option offered through your variable life insurance or variable annuity contract) within 60 days of their purchase. The fee, which is retained by the Fund, is accounted for as an addition to paid-in capital.

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a

21 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets

22 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Appreciation
					Based on Cost of
Undistributed	Undistributed		Accumulated		Securities and Other
Net Investment	Long-Term		Loss		Investments for Federal
Income	Gain		Carryforward1,2,3,4		Income Tax Purposes
$51,001,105	$	—	$	23,697,429	$	387,823,483

1. As of December 30, 2011, the Fund had $19,156,083 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2017	$	17,214,823
No expiration		1,941,260
Total	$	19,156,083

2.	As of December 30, 2011, the Fund had $4,541,346 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund did not utilize any capital loss carryforward.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $61,984,330 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Reduction to
Reduction to	Accumulated
Accumulated	Net Realized Loss
Net Investment Income	on Investments
$850,798	$	850,798

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	31,858,513	$	35,078,144

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the

23 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	2,004,481,659
Gross unrealized appreciation	$	523,872,404
Gross unrealized depreciation		(136,048,921	)
Net unrealized appreciation	$	387,823,483

Certain foreign countries impose a tax on capital gains which is accrued by the Fund based on unrealized appreciation, if any, on affected securities. The tax is paid when the gain is realized.

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum

24 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		2,898,558		$	85,697,523			3,002,141		$	81,399,571
Dividends and/or distributions reinvested		544,183			17,234,287			719,257			19,240,136
Redeemed		(7,582,244	)		(227,714,727	)		(8,659,048	)		(234,065,409	)
Net decrease		(4,139,503	)	$	(124,782,917	)		(4,937,650	)	$	(133,425,702	)
Service Shares
Sold		5,113,489		$	150,060,254			4,081,506		$	109,511,274
Dividends and/or distributions reinvested		361,125			11,357,368			453,129			12,039,643
Redeemed		(5,264,551	)		(156,264,287	)		(5,166,594	)		(138,123,640	)
Net increase (decrease)		210,063		$	5,153,335			(631,959	)	$	(16,572,723	)
Class 3 Shares
Sold		210,150		$	6,434,653			201,269		$	5,485,318
Dividends and/or distributions reinvested		76,748			2,447,497			106,384			2,863,873
Redeemed		(1,203,693	)		(36,250,505	)1		(1,401,659	)		(37,956,802	)2
Net decrease		(916,795	)	$	(27,368,355	)		(1,094,006	)	$	(29,607,611	)
Class 4 Shares
Sold		153,872		$	4,648,188			83,546		$	2,267,578
Dividends and/or distributions reinvested		26,011			819,361			35,118			934,492
Redeemed		(389,690	)		(11,451,926	)1		(362,658	)		(9,622,812	)2
Net decrease		(209,807	)	$	(5,984,377	)		(243,994	)	$	(6,420,742	)

1.	Net of redemption fees of $1,073 and $1,794 for Class 3 and Class 4, respectively.
2.	Net of redemption fees of $3,781 and $2,816 for Class 3 and Class 4, respectively.

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	356,222,355	$	489,405,781

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NOTES TO FINANCIAL STATEMENTS Continued

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $2,725,086 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares and Class 4 Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares and Class 4 shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares and Class 4 shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares and Class 4 shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares and Class 4 shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares and Class 4 shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 1.00% for Non-Service and Class 3 shares and 1.25% for Service and Class 4 shares.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $27,171 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

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Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

27 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for
as Hedging Instruments	Foreign currency transactions
Foreign exchange contracts	$	203,036

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for	Translation of assets and liabilities
as Hedging Instruments	denominated in foreign currencies
Foreign exchange contracts	$	2,260

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions, respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $1,750,114 and $2,981,138, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

     As of December 30, 2011, the Fund had no outstanding forward contracts.

6. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name

28 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court

29 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

NOTE S TO FINANCIAL STATEMENTS Continued

6. Pending Litigation Continued

against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

30 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Global Securities Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Global Securities Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian and transfer agent. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Global Securities Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado

February 16, 2012

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FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 23.65% to arrive at the amount eligible for the corporate dividend-received deduction.

     The Fund has elected the application of Section 853 of the Internal Revenue Code to permit shareholders to take a federal income tax credit or deduction, at their option, on a per share basis. The maximum amount allowable but not less than $5,148,157 of foreign income taxes were paid by the Fund during the fiscal year ended December 30, 2011. A separate notice will be mailed to each shareholder, which will reflect the proportionate share of such foreign taxes which must be treated by shareholders as gross income for federal income tax purposes.

     Gross income of the maximum amount allowable but not less than $54,961,717 was derived from sources within foreign countries or possessions of the United States.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

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BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio manager and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Rajeev Bhaman, the portfolio manager for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The

33 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued

Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other global core funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-, three-, five-, and ten-year Lipper periods.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other global core funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were lower than its expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 1.00% for Non-Service and Class 3 shares and 1.25% for Service and Class 4 shares. This voluntary expense limitation may be amended or withdrawn at any time.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

34 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

35 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following:
	UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000—June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and

36 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

Beverly L. Hamilton, Continued	Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999-March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005- June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005- December 2006) and President (February 2005- March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

37 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Bhaman, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Rajeev Bhaman, Vice President (since 2004) Age: 48	Senior Vice President of the Manager (since May 2006); Vice President of the Manager (January 1997-May 2006); a Chartered Financial Analyst. An officer of 3 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003- October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

38 | OPPENHEIMER GLOBAL SECURITIES FUND/VA

OPPENHEIMER GLOBAL SECURITIES FUND/VA

A Series of Oppenheimer Variable Account Funds
Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

^©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011 Oppenheimer High Income Fund/VA Annual Report A Series of Oppenheimer Variable Account Funds A N N UA L R E P O RT Fund Allocations Fund Performance Discussion Financial Statements 1234

OPPENHEIMER HIGH INCOME FUND/VA

Portfolio Manager: Joseph Welsh

Average Annual Total Returns

For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		–2.34	%		–21.43	%		–7.84	%
Service Shares		–2.56	%		–21.42	%		–7.94	%

						Since
						Inception
	1-Year			5-Year		(5/1/07)
Class 3		–1.88	%		N/A		–23.25	%
Class 4		–2.06	%		N/A		–23.20	%

Expense Ratios

For the Period Ended 12/30/11¹

	Gross			Net
	Expense			Expense
	Ratios			Ratios
Non-Service Shares		0.98	%		0.75	%
Service Shares		1.23			1.00
Class 3 Shares		0.98			0.75
Class 4 Shares		1.23			1.00

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Credit Rating Breakdown

	NRSRO Only Total
AAA		10.5	%
BBB		2.1
BB		15.7
B		49.6
CCC		17.0
CC		0.8
Unrated		4.3
Total		100.0	%

The percentages above are based on the market value of the Fund’s securities as of December 30, 2011, and are subject to change. Except for securities labeled “Unrated” and except for certain securities issued or guaranteed by a sovereign or supranational entity, all securities have been rated by at least one Nationally Recognized Statistical Rating Organization (“NRSRO”), such as Standard & Poor’s (“S&P”). For securities rated only by an NRSRO other than S&P, OppenheimerFunds, Inc. converts that rating to the equivalent S&P rating. If two or more NRSROs have assigned a rating to a security, the highest S&P equivalent rating is used. Unrated securities issued or guaranteed by a sovereign entity are assigned a credit rating equal to the highest NRSRO rating assigned to that sovereign entity. U.S. Government “Treasury” and “Agency” securities are included in the AAA category. Fund assets invested in Oppenheimer Institutional Money Market Fund are assigned that fund’s S&P rating, which is currently AAA. For the purposes of this Credit Allocation table, “investment-grade” securities are securities rated within the NRSROs’ four highest rating categories, which include AAA, AA, A and BBB. Unrated securities do not necessarily indicate low credit quality, and may or may not be the equivalent of investment-grade. Please consult the Fund’s prospectus for further information. Additional information can be found in the Fund’s Statement of Additional Information.

Corporate Bonds & Notes—Top Ten Industries

Media	9.1	%
Oil, Gas & Consumable Fuels	6.7
Hotels, Restaurants & Leisure	5.7
Capital Markets	5.6
Aerospace & Defense	3.8
Paper & Forest Products	3.1
Health Care Providers & Services	3.0
Energy Equipment & Services	2.9
Machinery	2.6
Auto Components	2.4

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER HIGH INCOME FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares returned –2.34% during the reporting period ended December 30, 2011.¹ On a relative basis, the Fund underperformed the JPMorgan Domestic High Yield Index (the “Index”), which returned 6.96%² The Fund also underperformed the BofA Merrill Lynch High Yield Master Index, which returned 4.50%. The Fund’s negative performance occurred over the volatile third quarter of 2011 when a number of dramatic global events resulted in increased risk aversion in the markets, as higher-yielding securities sold off and investors flocked to traditionally defensive securities, such as U.S. Treasuries.

Economic and Market Overview

The first half of the reporting period was generally characterized by resilience among investors who looked forward to improved credit conditions in a recovering global economy. Even the wave of political unrest in the Middle East in early 2011, which led to sharply higher energy prices, had only a temporary dampening effect on most financial markets. Likewise, markets recovered relatively quickly after a devastating natural disaster and subsequent nuclear energy crisis hit Japan in March, disrupting global industrial supply chains. During this time, equities and higher-yielding fixed income securities generally performed well.

     Investor sentiment began to deteriorate in late April, when U.S. economic data proved disappointing, and a contentious U.S. fiscal policy debate intensified. These concerns reached a tipping point in early August, when the credit rating company Standard & Poor’s downgraded the sovereign debt of the U.S., a decision that the two other major credit rating firms opted not to follow.

     Meanwhile, international uncertainty worsened with the high likelihood that Greece was headed for default on its debt and other members of the European Union continued to struggle with heavy debt burdens, leading to worries over the health of the European banking system. Inflationary pressures mounted in China and other emerging markets, where investors grew concerned that remedial measures, including higher local interest rates, might derail these major engines of global growth. Financial markets also grew concerned that new recessions in the developed markets could mean a slowdown in growth in export dependent emerging economies. Some emerging market countries saw their GDP growth stall after a prolonged period of solid increases.

     These events triggered a flight to quality that boosted traditional safe havens but hurt areas of the market that historically have been considered riskier. In the United States, long-term U.S. Treasury securities continued to rally even after the credit-rating downgrade, but high yield corporate bonds gave back earlier gains, despite generally healthy balance sheets and limited needs for near term refinancing. Market turbulence throughout the world was particularly severe over the third quarter of 2011 with most global risk markets experiencing sharp declines.

     In the fourth quarter, risk markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Fund Review

During the reporting period, the primary reason for the Fund’s underperformance versus the Index was its heavier exposure to high yield bonds with lower credit quality. This positioning impacted performance particularly in the third quarter of 2011 amid heightened risk aversion. The most significant underperforming areas for the Fund this period were paper and packaging and gaming, lodging and leisure. The Fund had overweight positions in these sectors, which were hit hard in the third quarter of 2011. Energy and health care also were underperformers for the Fund.

1.	December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.
2.	The JPMorgan Domestic High Yield Index is an index of high yield fixed income securities issued by developed countries. The index is unmanaged and cannot be purchased directly by investors. Index performance is shown for illustrative purposes only and does not predict or depict the performance of the Fund.

3 | OPPENHEIMER HIGH INCOME FUND/VA

FUND PERFORMANCE DISCUSSION

     Positive performing areas for the Fund included retail, technology and cable and satellite. While the Fund had a very small allocation to retail during the period, its investments in the sector performed well. The Fund had larger allocations to technology and cable and satellite-related investments at period end. Stronger relative security selection drove the Fund’s positive performance in these areas.

Outlook

We remain cautiously optimistic at period end. We expect uncertainty in the Eurozone to keep consumer, business and investor anxiety elevated. Yet, we see recent steps taken by Eurozone policymakers to address the crisis as positive; albeit slow and incomplete. In the U.S., concerns remain over slow growth and the ability of elected officials to address the key issues relating to deficits, entitlements and taxation. However, a domestic recession seems unlikely given recent upside surprises and the possibility of QE3 as 2012 progresses.

     Despite these ongoing concerns, we believe the continued high level of risk aversion could mean bond markets have priced in most negative outcomes. This could be beneficial to higher-yielding asset classes in the face of positive, or less negative headlines. Defaults in non-investment grade markets remain very low and are a function of stable revenue and profitability in our view. We believe that even in a recession, defaults are not likely to reach an elevated level due to the improved balance sheets of high yield borrowers, limited need for refinancing, and the weeding out of weaker credits in 2008. Finally, we believe that careful security selection may benefit investors as risk aversion abates.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. In the case of Non-Service shares and Service shares, performance is measured over a ten-fiscal-year period. In the case of Class 3 and Class 4 shares, performance is measured from inception of the Classes on May 1, 2007. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the BofA Merrill Lynch High Yield Master Index, an unmanaged index of U.S. corporate and government bonds that is a measure of the performance of the high-yield corporate bond market. Index performance includes reinvestment of income but does not reflect transaction fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

4 | OPPENHEIMER HIGH INCOME FUND/VA

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

5 | OPPENHEIMER HIGH INCOME FUND/VA

FUND PERFORMANCE DISCUSSION

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER HIGH INCOME FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

7 | OPPENHEIMER HIGH INCOME FUND/VA

FUND EXPENSES Continued

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
Actual	July 1, 2011		December 30, 2011		December 30, 2011
Non-Service Shares	$	1,000.00	$	931.40	$	3.64
Service shares		1,000.00		927.20		4.84
Class 3		1,000.00		932.00		3.64
Class 4		1,000.00		932.70		4.86
Hypothetical
(5% return before expenses)
Non-Service Shares	$	1,000.00	$	1,021.31		3.81
Service shares		1,000.00		1,020.05		5.08
Class 3		1,000.00		1,021.31		3.81
Class 4		1,000.00		1,020.05		5.08

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.75	%
Service shares		1.00
Class 3		0.75
Class 4		1.00

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

8 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Principal
	Amount		Value
Loan Participations—5.2%
Brock Holdings III, Inc., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 10%, 2/15/181	$	155,000	$	142,794
Clear Channel Communications, Inc., Sr. Sec. Credit Facilities 1st Lien Term Loan:
Tranche B, 3.91%, 1/29/161		430,000		319,036
Tranche B, 3.91%, 1/29/161,2		30,000		22,258
Entegra Holdings LLC, Sr. Sec. Credit Facilities 3rd Lien Term Loan, Tranche B, 3.855%, 10/19/151,3		1,480,568		882,171
Nuveen Investments, Inc., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 12.50%, 7/31/15		696,875		723,298
OneLink Communications/San Juan Cable LLC, Sr. Sec. Credit Facilities 2nd Lien Term Loan, Tranche B, 10%, 10/31/131		420,000		409,500
PQ Corp., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 6.50%, 7/30/151,2		625,000		556,446
Realogy Corp., Extended Sr. Sec. Credit Facilities 1st Lien Term Loan:
Tranche B, 4%, 10/10/161,2		62,376		55,971
Tranche B, 4.522%, 10/10/161,2		791,174		709,937
Revel Entertainment LLC, Sr. Sec. Credit Facilities 1st Lien Term Loan, 7.50%, 2/17/171,2		300,000		275,250
Samson Investment Co., Sr. Sec. Credit Facilities Bridge Loan, 6.50%, 12/20/121,2		1,120,000		1,120,000
Walter Investment Management Corp., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 11%, 9/28/161,2		325,000		328,859
Walter Investment Management Corp., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 12.50%, 9/28/161		330,000		333,919
Total Loan Participations (Cost $5,890,695)				5,879,439
Corporate Bonds and Notes—80.7%
Consumer Discretionary—18.8%
Auto Components—2.4%
Goodyear Tire & Rubber Co. (The), 8.25% Sr. Unsec. Unsub. Nts., 8/15/20		610,000		667,950
Tower Automotive Holdings USA LLC/TA Holdings Finance, Inc., 10.625% Sr. Sec. Nts., 9/1/174		1,365,000		1,378,650
Visteon Corp., 6.75% Sr. Nts., 4/15/194		690,000		691,725
				2,738,325
Automobiles—0.1%
Jaguar Land Rover plc, 7.75% Sr. Unsec. Bonds, 5/15/184		110,000		105,325
Hotels, Restaurants & Leisure—5.7%
Equinox Holdings, Inc., 9.50% Sr. Sec. Nts., 2/1/164		510,000		526,575
Harrah’s Operating Co., Inc., 10% Sr. Sec. Nts., 12/15/18		2,608,000		1,799,520
HOA Restaurants Group LLC/HOA Finance Corp., 11.25% Sr. Sec. Nts., 4/1/174		660,000		618,750
Isle of Capri Casinos, Inc.:
7% Sr. Unsec. Sub. Nts., 3/1/14		405,000		380,700
7.75% Sr. Unsec. Unsub. Nts., 3/15/19		585,000		538,200
Landry’s Restaurants, Inc., 11.625% Sr. Sec. Nts., 12/1/15		455,000		481,163
MGM Mirage, Inc., 6.625% Sr. Unsec. Nts., 7/15/15		955,000		912,025
Mohegan Tribal Gaming Authority, 8% Sr. Sub. Nts., 4/1/12		840,000		567,000
Penn National Gaming, Inc., 8.75% Sr. Unsec. Sub. Nts., 8/15/19		435,000		475,238
Travelport LLC, 11.875% Sr. Unsec. Sub. Nts., 9/1/16		560,000		165,200
				6,464,371
Household Durables—0.7%
Beazer Homes USA, Inc.:
6.875% Sr. Unsec. Nts., 7/15/15		280,000		210,700
9.125% Sr. Unsec. Nts., 5/15/19		790,000		543,125
				753,825
Media—9.1%
Affinion Group Holdings, Inc., 11.625% Sr. Unsec. Nts., 11/15/15		325,000		271,375
Affinion Group, Inc., 7.875% Sr. Unsec. Nts., 12/15/18		760,000		646,000
Belo (A.H.) Corp., 7.75% Sr. Unsec. Unsub. Debs., 6/1/27		719,000		627,328
Cengage Learning Acquisitions, Inc., 10.50% Sr. Nts., 1/15/154		740,000		534,650
Cequel Communications Holdings I LLC, 8.625% Sr. Unsec. Nts., 11/15/174		620,000		660,300
Clear Channel Communications, Inc., 5.75% Sr. Unsec. Unsub. Nts., 1/15/13		860,000		821,300
CSC Holdings LLC, 6.75% Sr. Unsec. Nts., 11/15/214		1,895,000		2,003,963
Cumulus Media, Inc., 7.75% Sr. Nts., 5/1/194		350,000		312,375
Entravision Communications Corp., 8.75% Sr. Sec. Nts., 8/1/17		535,000		526,975

9 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Media Continued
Gray Television, Inc., 10.50% Sr. Sec. Nts., 6/29/15	$	1,010,000	$	959,500
Kabel BW Erste Beteiligungs GmbH/Kabel Baden-Wurttemberg GmbH & Co. KG, 7.50% Sr. Sec. Nts., 3/15/194		395,000		416,725
Newport Television LLC/NTV Finance Corp., 12.719% Sr. Nts., 3/15/173,4		607,469		545,203
Nexstar Broadcasting, Inc./Mission Broadcasting, Inc., 8.875% Sec. Nts., 4/15/17		535,000		551,050
Sinclair Television Group, Inc., 8.375% Sr. Unsec. Nts., 10/15/18		705,000		731,438
UPCB Finance V Ltd., 7.25% Sr. Sec. Nts., 11/15/214		350,000		356,125
Visant Corp., 10% Sr. Unsec. Nts., 10/1/17		320,000		294,400
				10,258,707
Specialty Retail—0.5%
Burlington Coat Factory Warehouse Corp., 10% Sr. Unsec. Nts., 2/15/19		545,000		535,463
Michaels Stores, Inc., 7.75% Sr. Unsec. Nts., 11/1/18		45,000		45,675
				581,138
Textiles, Apparel & Luxury Goods—0.3%
Jones Group, Inc. (The) /Jones Apparel Group Holdings, Inc./Jones Apparel Group USA, Inc./JAG Footwear, Accessories & Retail Corp., 6.875% Sr. Unsec. Unsub. Nts., 3/15/19		400,000		362,000
Consumer Staples—2.5%
Food Products—2.2%
American Seafoods Group LLC, 10.75% Sr. Sub. Nts., 5/15/164		620,000		554,900
ASG Consolidated LLC, 15% Sr. Nts., 5/15/173,4		1,202,532		931,962
Bumble Bee Acquisition Corp., 9% Sr. Sec. Nts., 12/15/174		266,000		271,320
Southern States Cooperative, Inc., 11.25% Sr. Nts., 5/15/155		690,000		727,950
				2,486,132
Household Products—0.3%
Spectrum Brands Holdings, Inc., 9.50% Sr. Sec. Nts., 6/15/18		250,000		274,688
Energy—9.6%
Energy Equipment & Services—2.9%
Forbes Energy Services Ltd., 9% Sr. Unsec. Nts., 6/15/19		475,000		446,500
Global Geophysical Services, Inc., 10.50% Sr. Unsec. Nts., 5/1/17		615,000		581,175
Offshore Group Investments Ltd., 11.50% Sr. Sec. Nts., 8/1/15		765,000		830,981
Precision Drilling Corp., 6.625% Sr. Unsec. Nts., 11/15/20		575,000		590,813
SESI LLC, 6.375% Sr. Unsec. Nts., 5/1/19		795,000		812,888
				3,262,357
Oil, Gas & Consumable Fuels—6.7%
Arch Coal, Inc., 7% Sr. Unsec. Nts., 6/15/194		110,000		112,750
Atlas Pipeline Partners LP/Atlas Pipeline Finance Corp., 8.75% Sr. Unsec. Nts., 6/15/184		440,000		462,000
ATP Oil & Gas Corp., 11.875% Sr. Sec. Nts., 5/1/15		760,000		503,500
Bill Barrett Corp., 7.625% Sr. Unsec. Unsub. Nts., 10/1/19		225,000		236,250
Breitburn Energy Partners LP/Breitburn Finance Corp., 8.625% Sr. Unsec. Nts., 10/15/20		665,000		699,081
Chaparral Energy, Inc., 9.875% Sr. Unsec. Nts., 10/1/20		510,000		553,350
Cloud Peak Energy Resources LLC/Cloud Peak Energy Finance Corp., 8.50% Sr. Unsec. Unsub. Nts., 12/15/19		110,000		119,350
James River Coal Co., 7.875% Sr. Unsec. Unsub. Nts., 4/1/19		160,000		121,600
Linn Energy LLC/Linn Energy Finance Corp., 8.625% Sr. Unsec. Nts., 4/15/20		1,035,000		1,128,150
MEG Energy Corp., 6.50% Sr. Unsec. Nts., 3/15/214		795,000		816,863
Murray Energy Corp., 10.25% Sr. Sec. Nts., 10/15/154		895,000		892,763
Navios Maritime Acquisition Corp., 8.625% Sr. Sec. Nts., 11/1/17		195,000		142,350
Quicksilver Resources, Inc.:
8.25% Sr. Unsec. Nts., 8/1/15		50,000		52,000
11.75% Sr. Nts., 1/1/16		500,000		570,000
SandRidge Energy, Inc.:
8.75% Sr. Unsec. Nts., 1/15/20		560,000		581,000
9.875% Sr. Unsec. Nts., 5/15/164		305,000		327,875
Venoco, Inc., 8.875% Sr. Unsec. Nts., 2/15/19		345,000		312,225
				7,631,107
Financials—10.9%
Capital Markets—5.6%
Berry Plastics Holding Corp., 10.25% Sr. Unsec. Sub. Nts., 3/1/16		300,000		291,000

10 | OPPENHEIMER HIGH INCOME FUND/VA

	Principal
	Amount		Value
Capital Markets Continued
Edgen Murray Corp., 12.25% Sr. Sec. Nts., 1/15/15	$	360,000	$	325,800
Nationstar Mortgage/Nationstar Capital Corp., 10.875% Sr. Unsec. Nts., 4/1/15		1,955,000		1,945,212
Nuveen Investments, Inc.:
5.50% Sr. Unsec. Nts., 9/15/15		535,000		452,075
10.50% Sr. Unsec. Unsub. Nts., 11/15/15		565,000		563,588
Pinafore LLC/Pinafore, Inc., 9% Sec. Nts., 10/1/18		1,125,000		1,252,969
Springleaf Finance Corp., 6.90% Nts., Series J, 12/15/17		630,000		456,750
Verso Paper Holdings LLC, 11.375% Sr. Unsec. Sub. Nts., Series B, 8/1/16		1,500,000		622,500
Verso Paper Holdings LLC/Verso Paper, Inc., 8.75% Sr. Sec. Nts., 2/1/19		625,000		384,375
				6,294,269
Commercial Banks—0.5%
CIT Group, Inc., 7% Sec. Bonds, 5/2/174		560,000		560,000
Consumer Finance—0.8%
Speedy Cash, Inc., 10.75% Sr. Sec. Nts., 10/15/184		430,000		434,300
TMX Finance LLC/TitleMax Finance Corp., 13.25% Sr. Sec. Nts., 7/15/15		455,000		502,775
				937,075
Insurance—0.9%
International Lease Finance Corp.:
8.625% Sr. Unsec. Unsub. Nts., 9/15/15		410,000		421,788
8.75% Sr. Unsec. Unsub. Nts., 3/15/17		622,000		642,215
				1,064,003
Real Estate Investment Trusts—1.9%
DuPont Fabros Technology LP, 8.50% Sr. Unsec. Nts., 12/15/17		255,000		274,125
FelCor Escrow Holdings LLC, 6.75% Sr. Sec. Nts., 6/1/19		1,155,000		1,114,575
OMEGA Healthcare Investors, Inc., 6.75% Sr. Unsec. Nts., 10/15/22		695,000		701,950
				2,090,650
Real Estate Management & Development—1.2%
Ainsworth Lumber Co. Ltd., 11% Sr. Unsec. Unsub. Nts., 7/29/153,4		883,277		570,102
Realogy Corp., 11.50% Sr. Unsec. Unsub. Nts., 4/15/17		365,000		286,525
Wallace Theater Holdings, Inc., 12.50% Sr. Sec. Nts., 6/15/131,4		530,000		516,750
				1,373,377
Health Care—5.6%
Biotechnology—0.2%
Grifols, Inc., 8.25% Sr. Sec. Nts., 2/1/18		195,000		205,725
Health Care Equipment & Supplies—1.7%
Accellent, Inc., 10% Sr. Unsec. Sub. Nts., 11/1/17		570,000		464,550
Alere, Inc., 8.625% Sr. Unsec. Sub. Nts., 10/1/18		290,000		287,100
Biomet, Inc.:
10.375% Sr. Unsec. Nts., 10/15/173		305,000		331,688
11.625% Sr. Unsec. Sub. Nts., 10/15/17		275,000		299,750
Chiron Merger Sub, Inc., 10.50% Sec. Nts., 11/1/184		290,000		284,925
Inverness Medical Innovations, Inc., 7.875% Sr. Unsec. Unsub. Nts., 2/1/16		290,000		292,175
				1,960,188
Health Care Providers & Services—3.0%
Catalent Pharma Solutions, Inc., 9.50% Sr. Unsec. Nts., 4/15/153		445,151		459,618
Gentiva Health Services, Inc., 11.50% Sr. Unsec. Unsub. Nts., 9/1/18		340,000		280,925
HealthSouth Corp., 8.125% Sr. Unsec. Unsub. Nts., 2/15/20		514,000		520,425
inVentiv Health, Inc., 10% Sr. Unsec. Nts., 8/15/184		310,000		285,200
Kindred Healthcare, Inc., 8.25% Sr. Unsec. Nts., 6/1/19		620,000		523,900
Multiplan, Inc., 9.875% Sr. Nts., 9/1/184		240,000		250,800
Oncure Holdings, Inc., 11.75% Sr. Sec. Nts., 5/15/17		315,000		250,425
Radiation Therapy Services, Inc., 9.875% Sr. Unsec. Sub. Nts., 4/15/17		335,000		252,088
STHI Holding Corp., 8% Sec. Nts., 3/15/184		200,000		206,500
US Oncology, Inc., Escrow Shares (related to 9.125% Sr. Sec. Nts., 8/15/17)6		435,000		7,613
Vanguard Health Holding Co. II LLC/Vanguard Holding Co. II, Inc., 8% Sr. Nts., 2/1/18		375,000		374,063
				3,411,557
Health Care Technology—0.1%
MedAssets, Inc., 8% Sr. Unsec. Nts., 11/15/18		75,000		73,875
Life Sciences Tools & Services—0.2%
Jaguar Holding Co./Jaguar Merger Sub, Inc., 9.50% Sr. Unsec. Nts., 12/1/194		220,000		232,100
Pharmaceuticals—0.4%
DJO Finance LLC/DJO Finance Corp., 10.875% Sr. Unsec. Nts., 11/15/14		150,000		140,625

11 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Pharmaceuticals Continued
Valeant Pharmaceuticals International, Inc., 6.875% Sr. Unsec. Nts., 12/1/184	$	190,000	$	190,475
Warner Chilcott Co. LLC/Warner Chilcott Finance LLC, 7.75% Sr. Unsec. Nts., 9/15/18		145,000		148,806
				479,906
Industrials—12.3%
Aerospace & Defense—3.8%
BE Aerospace, Inc., 6.875% Sr. Nts., 10/1/20		240,000		262,800
DynCorp International, Inc., 10.375% Sr. Unsec. Nts., 7/1/17		1,085,000		949,375
Hawker Beechcraft Acquisition Co. LLC:
8.50% Sr. Unsec. Nts., 4/1/15		1,405,000		266,950
9.75% Sr. Unsec. Sub. Nts., 4/1/17		240,000		24,000
Huntington Ingalls Industries, Inc., 7.125% Sr. Unsec. Nts., 3/15/214		805,000		792,925
Kratos Defense & Security Solutions, Inc., 10% Sr. Sec. Nts., 6/1/17		267,000		275,010
TransDigm, Inc., 7.75% Sr. Unsec. Sub. Nts., 12/15/18		920,000		993,600
Triumph Group, Inc., 8.625% Sr. Unsec. Nts., 7/15/18		650,000		715,000
				4,279,660
Air Freight & Logistics—0.5%
AMGH Merger Sub, Inc., 9.25% Sr. Sec. Nts., 11/1/184		510,000		527,850
Airlines—0.5%
American Airlines 2011-2 Class A Pass Through Trust, 8.625% Sec. Certificates, 4/15/23		560,000		571,200
Building Products—0.9%
Associated Materials LLC, 9.125% Sr. Sec. Nts., 11/1/174		265,000		232,538
Ply Gem Industries, Inc., 13.125% Sr. Unsec. Sub. Nts., 7/15/14		860,000		765,400
Roofing Supply Group LLC/Roofing Supply Finance, Inc., 8.625% Sr. Sec. Nts., 12/1/174		67,000		68,875
				1,066,813
Commercial Services & Supplies—1.8%
R.R. Donnelley & Sons Co., 7.25% Sr. Nts., 5/15/18		1,130,000		1,101,750
West Corp.:
7.875% Sr. Unsec. Nts., 1/15/19		305,000		304,238
8.625% Sr. Unsec. Nts., 10/1/18		635,000		644,525
				2,050,513
Machinery—2.6%
Cleaver-Brooks, Inc., 12.25% Sr. Sec. Nts., 5/1/165		680,000		675,716
CNH Capital LLC, 6.25% Sr. Unsec. Nts., 11/1/164		150,000		155,250
Manitowoc Co., Inc. (The), 8.50% Sr. Unsec. Nts., 11/1/20		685,000		725,244
Terex Corp., 8% Sr. Unsec. Sub. Nts., 11/15/17		1,005,000		989,925
Thermadyne Holdings Corp., 9% Sr. Sec. Nts., 12/15/17		335,000		348,400
				2,894,535
Marine—0.8%
Marquette Transportation Co./ Marquette Transportation Finance Corp., 10.875% Sec. Nts., 1/15/17		780,000		789,750
Navios Maritime Holdings, Inc./ Navios Maritime Finance U.S., Inc., 8.875% Sr. Sec. Nts., 11/1/17		160,000		153,200
				942,950
Professional Services—0.4%
Altegrity, Inc., 10.50% Sr. Unsec. Sub. Nts., 11/1/154		280,000		253,400
TransUnion LLC/TransUnion Financing Corp., 11.375% Sr. Unsec. Nts., 6/15/18		150,000		172,125
				425,525
Road & Rail—1.0%
Hertz Corp., 7.50% Sr. Unsec. Nts., 10/15/18		670,000		703,500
Western Express, Inc., 12.50% Sr. Sec. Nts., 4/15/154		1,045,000		449,350
				1,152,850
Information Technology—5.9%
Communications Equipment—0.3%
Avaya, Inc., 7% Sr. Sec. Nts., 4/1/194		290,000		282,750
Computers & Peripherals—0.9%
Seagate HDD Cayman:
6.875% Sr. Unsec. Nts., 5/1/20		535,000		552,388
7% Sr. Unsec. Nts., 11/1/214		475,000		489,250
				1,041,638
Electronic Equipment & Instruments—0.5%
CDW LLC/CDW Finance Corp., 12.535% Sr. Unsec. Sub. Nts., 10/12/17		550,000		555,500
Internet Software & Services—1.1%
ITC DeltaCom, Inc., 10.50% Sr. Sec. Nts., 4/1/16		1,245,000		1,279,238

12 | OPPENHEIMER HIGH INCOME FUND/VA

	Principal
	Amount		Value
IT Services—1.2%
Ceridian Corp., 11.25% Sr. Unsec. Nts., 11/15/15	$	535,000	$	419,975
First Data Corp.:
8.875% Sr. Sec. Nts., 8/15/204		395,000		396,975
9.875% Sr. Unsec. Nts., 9/24/15		595,000		562,275
				1,379,225
Semiconductors & Semiconductor Equipment—1.8%
Advanced Micro Devices, Inc., 7.75% Sr. Unsec. Nts., 8/1/20		600,000		619,500
Freescale Semiconductor, Inc.:
9.25% Sr. Sec. Nts., 4/15/184		525,000		563,719
10.75% Sr. Unsec. Nts., 8/1/20		503,000		526,893
NXP BV/NXP Funding LLC, 9.75% Sr. Sec. Nts., 8/1/184		245,000		268,275
				1,978,387
Software—0.1%
SunGard Data Systems, Inc., 7.375% Sr. Unsec. Nts., 11/15/18		160,000		164,600
Materials—7.4%
Chemicals—1.8%
Ferro Corp., 7.875% Sr. Unsec. Nts., 8/15/18		260,000		262,600
Hexion U.S. Finance Corp./Hexion Nova Scotia Finance ULC:
8.875% Sr. Sec. Nts., 2/1/18		345,000		325,163
9% Sec. Nts., 11/15/20		380,000		315,400
Lyondell Chemical Co., 8% Sr. Sec. Nts., 11/1/17		241,000		264,498
LyondellBasell Industries NV, 6% Sr. Nts., 11/15/214		440,000		458,700
Momentive Performance Materials, Inc., 9% Sec. Nts., 1/15/21		615,000		470,475
				2,096,836
Construction Materials—0.7%
Building Materials Corp. of America, 6.75% Sr. Nts., 5/1/214		435,000		457,838
Ply Gem Industries, Inc., 8.25% Sr. Sec. Nts., 2/15/18		325,000		284,781
				742,619
Containers & Packaging—0.8%
Polymer Group, Inc., 7.75% Sr. Sec.
Nts., 2/1/194		650,000		676,000
Solo Cup Co., 8.50% Sr. Sub.
Nts., 2/15/14		245,000		226,625
				902,625
Metals & Mining—1.0%
Aleris International, Inc., 7.625% Sr. Unsec. Nts., 2/15/18		1,050,000		1,029,000
Novelis, Inc., 8.75% Sr. Unsec. Nts., 12/15/20		135,000		145,463
				1,174,463
Paper & Forest Products—3.1%
ABI Escrow Corp., 10.25% Sr. Sec. Nts., 10/15/184		369,000		408,668
Appleton Papers, Inc., 10.50% Sr. Sec. Nts., 6/15/154		985,000		976,381
Catalyst Paper Corp., 11% Sr. Sec. Nts., 12/15/164		1,117,000		597,595
Mercer International, Inc., 9.50% Sr. Unsec. Nts., 12/1/17		475,000		488,063
NewPage Corp., 11.375% Sr. Sec. Nts., 12/31/146		1,025,000		763,625
Norske Skogindustrier ASA, 6.125% Unsec. Bonds, 10/15/155		375,000		226,875
				3,461,207
Telecommunication Services—4.0%
Diversified Telecommunication Services—2.3%
Cincinnati Bell, Inc.:
8.25% Sr. Nts., 10/15/17		335,000		338,350
8.75% Sr. Unsec. Sub. Nts., 3/15/18		480,000		448,200
Intelsat Bermuda Ltd.:
11.25% Sr. Unsec. Nts., 2/4/17		585,000		567,450
11.50% Sr. Unsec. Nts., 2/4/173		710		687
Level 3 Financing, Inc.:
9.25% Sr. Unsec. Unsub. Nts., 11/1/14		80,000		82,200
9.375% Sr. Unsec. Unsub. Nts., 4/1/19		540,000		566,325
Windstream Corp., 7.50% Sr. Unsec. Nts., 6/1/224		570,000		570,000
				2,573,212
Wireless Telecommunication Services—1.7%
Cricket Communications, Inc., 7.75% Sr. Unsec. Nts., 10/15/20		700,000		614,250
MetroPCS Wireless, Inc., 6.625% Sr. Unsec. Nts., 11/15/20		510,000		476,850
Nextel Communications, Inc., 7.375% Sr. Nts., Series D, 8/1/15		590,000		542,800
Sprint Capital Corp., 8.75% Nts., 3/15/32		135,000		109,856
Sprint Nextel Corp., 9% Sr. Unsec. Nts., 11/15/184		220,000		231,550
				1,975,306
Utilities—3.7%
Electric Utilities—1.9%
Edison Mission Energy, 7% Sr. Unsec. Nts., 5/15/17		835,000		546,925

13 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
Electric Utilities Continued
Energy Future Intermediate Holding Co. LLC, 10% Sr. Sec. Nts., 12/1/20	$	527,000		$	558,620
Texas Competitive Electric Holdings Co. LLC:
10.25% Sr. Unsec. Nts., Series A, 11/1/15		2,325,000			837,000
10.25% Sr. Unsec. Nts., Series B, 11/1/15		410,000			143,500
					2,086,045
Energy Traders—1.7%
AES Corp. (The), 8% Sr. Unsec. Unsub. Nts., 10/15/17		245,000			270,725
Calpine Corp., 7.50% Sr. Sec. Nts., 2/15/214		255,000			274,125
Energy Future Holdings Corp., 10% Sr. Sec. Nts., 1/15/20		530,000			559,150
First Wind Capital LLC, 10.25% Sr. Sec. Nts., 6/1/184		75,000			74,063
Foresight Energy LLC, 9.625% Sr. Unsec. Nts., 8/15/174		540,000			556,200
NRG Energy, Inc., 7.625% Sr. Unsec. Nts., 1/15/18		160,000			160,800
United Maritime Group LLC, 11.75% Sr. Sec. Nts., 6/15/15		15,000			15,338
					1,910,401
Gas Utilities—0.1%
Ferrellgas LP/Ferrellgas Finance Corp., 6.50% Sr. Unsec. Nts., 5/1/21		170,000			150,450
Total Corporate Bonds and Notes (Cost $98,243,294)					91,267,098
	Shares
Preferred Stocks—1.4%
Ally Financial, Inc., 7%, Non-Vtg.4		894			640,914
GMAC Capital Trust I, 8.125% Cum.		10,000			193,400
Greektown Superholdings, Inc., Series A-17		11,550			751,905
Total Preferred Stocks (Cost $2,195,603)					1,586,219
Common Stocks—3.0%
AbitibiBowater, Inc.7		27,638			402,133
American Media Operations, Inc.7		58,065			929,040
Dana Holding Corp.7		19,738			239,817
Gaylord Entertainment Co., Cl. A7		12,561			303,223
Global Aviation Holdings, Inc.7		300			3,000
Greektown Superholdings, Inc.7		874			52,929
Huntsman Corp.		6,611			66,110
Kaiser Aluminum Corp.		458			21,013
LyondellBasell Industries NV, Cl. A		12,828			416,782
Orbcomm, Inc.7		1,127			3,370
Range Resources Corp.		1,965			121,712
Solutia, Inc.7		5,507			95,161
Visteon Corp.7		10,807			539,702
Walter Industries, Inc.		1,011			61,226
Whiting Petroleum Corp.7		2,034			94,967
Total Common Stocks (Cost $5,763,505)					3,350,185
	Units
Rights, Warrants and Certificates—0.0%
MediaNews Group, Inc. Wts., Strike Price $0.001, Exp. 3/19/177 (Cost $3,168,495)		11,017			396
	Shares
Investment Company—10.6%
Oppenheimer Institutional
Money Market Fund,
Cl. E, 0.20%8,9 (Cost $11,964,562)		11,964,562			11,964,562
Total Investments, at Value (Cost $127,226,154)		100.9	%		114,047,899
Liabilities in Excess of Other Assets		(0.9	)		(971,484	)
Net Assets		100.0	%	$	113,076,415

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Represents the current interest rate for a variable or increasing rate security.
2.	When-issued security or delayed delivery to be delivered and settled after December 30, 2011. See Note 1 of the accompanying Notes.
3.	Interest or dividend is paid-in-kind, when applicable.
4.	Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $26,455,142 or 23.40% of the Fund’s net assets as of December 30, 2011.

14 | OPPENHEIMER HIGH INCOME FUND/VA

5. Restricted security. The aggregate value of restricted securities as of December 30, 2011 was $1,630,541, which represents 1.44% of the Fund’s net assets. See Note 6 of the accompanying Notes. Information concerning restricted securities is as follows:

							Unrealized
	Acquisition						Appreciation
Security	Dates		Cost		Value		(Depreciation)
Cleaver-Brooks, Inc., 12.25% Sr. Sec. Nts., 5/1/16		4/21/10-5/3/11	$	688,172	$	675,716	$	(12,456	)
Norske Skogindustrier ASA, 6.125% Unsec. Bonds, 10/15/15		3/7/11-4/6/11		341,158		226,875		(114,283	)
Southern States Cooperative, Inc., 11.25% Sr. Nts., 5/15/15		4/28/10-5/4/11		703,283		727,950		24,667
			$	1,732,613	$	1,630,541	$	(102,072	)

6.	This security is not accruing income because the issuer has missed an interest payment on it and/or is not anticipated to make future interest and/or principal payments. The rate shown is the original contractual interest rate. See Note 1 of the accompanying Notes.
7.	Non-income producing security.
8.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		4,033,152		64,468,224		56,536,814		11,964,562

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	11,964,562	$	9,835

9. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3—
	Level 1—		Level 2—		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Loan Participations	$	—	$	5,879,439	$	—	$	5,879,439
Corporate Bonds and Notes		—		91,267,098		—		91,267,098
Preferred Stocks		—		834,314		751,905		1,586,219
Common Stocks		1,825,514		1,468,742		55,929		3,350,185
Rights, Warrants and Certificates		—		—		396		396
Investment Company		11,964,562		—		—		11,964,562
Total Assets	$	13,790,076	$	99,449,593	$	808,230	$	114,047,899

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

15 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The following is a reconciliation of assets in which significant unobservable inputs (level 3) were used in determining fair value:

						Change in
						unrealized					Transfers
	Value as of		Realized			appreciation/					out of			Value as of
	December 31, 2010		gain (loss)			depreciation		Sales			Level 3			December 30, 2011
Assets Table
Investments, at Value:
Common Stocks	$	1,036,161	$	(208,776	)	$	959,338	$	—		$	(1,730,794	)a	$	55,929
Corporate Bonds and Notes		87,082		(1,591,368	)		1,612,742		(108,456	)		—			—
Preferred Stocks		1,226,957		(1,097,476	)		622,424		—			—			751,905
Rights, Warrants and Certificates		403		(4,340	)		4,333		—			—			396
Total Assets	$	2,350,603	$	(2,901,960	)	$	3,198,837	$	(108,456	)	$	(1,730,794	)	$	808,230

a. Transferred from Level 3 because of the presence of a readily available unadjusted quoted market price for these securities.

The total change in unrealized appreciation/depreciation included in the Statement of Operations attributable to Level 3 investments still held at December 30, 2011 includes:

	Change in unrealized
	appreciation/depreciation
Common Stocks	$	(33,440	)
Preferred Stocks		(403,095	)
Rights, Warrants and Certificates		(3,168,099	)
Total	$	(3,604,634	)

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

16 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $115,261,592)	$	102,083,337
Affiliated companies (cost $11,964,562)		11,964,562
		114,047,899
Cash		68,417
Receivables and other assets:
Interest, dividends and principal paydowns		2,238,917
Shares of beneficial interest sold		154,689
Investments sold		34,212
Other		14,135
Total assets		116,558,269
Liabilities
Payables and other liabilities:
Investments purchased (including $3,051,790 purchased on a when-issued or delayed delivery basis)		3,308,552
Shareholder communications		56,741
Shares of beneficial interest redeemed		31,872
Distribution and service plan fees		12,875
Trustees’ compensation		12,415
Transfer and shareholder servicing agent fees		9,619
Other		49,780
Total liabilities		3,481,854
Net Assets	$	113,076,415
Composition of Net Assets
Par value of shares of beneficial interest	$	59,230
Additional paid-in capital		337,809,203
Accumulated net investment income		10,456,939
Accumulated net realized loss on investments		(222,070,702	)
Net unrealized depreciation on investments		(13,178,255	)
Net Assets	$	113,076,415
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $47,499,698 and 24,979,229 shares of beneficial interest outstanding)	$	1.90
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $54,393,841 and 28,460,077 shares of beneficial interest outstanding)	$	1.91
Class 3 Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $4,034,676 and 2,101,852 shares of beneficial interest outstanding)	$	1.92
Class 4 Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $7,148,200 and 3,689,262 shares of beneficial interest outstanding)	$	1.94

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

17 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Interest	$	11,742,695
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $14,196)		212,439
Affiliated companies		9,835
Total investment income		11,964,969
Expenses
Management fees		965,572
Distribution and service plan fees:
Service shares		151,041
Class 4 shares		19,634
Transfer and shareholder servicing agent fees:
Non-Service shares		55,024
Service shares		60,423
Class 3 shares		5,436
Class 4 shares		7,859
Shareholder communications:
Non-Service shares		24,900
Service shares		27,028
Class 3 shares		2,462
Class 4 shares		3,470
Custodian fees and expenses		31,643
Trustees’ compensation		9,745
Administration service fees		1,500
Other		68,359
Total expenses		1,434,096
Less waivers and reimbursements of expenses		(298,448	)
Net expenses		1,135,648
Net Investment Income		10,829,321
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments from unaffiliated companies		736,886
Swap contracts		(48,715	)
Net realized gain		688,171
Net change in unrealized appreciation/depreciation on investments		(13,278,671	)
Net Decrease in Net Assets Resulting from Operations	$	(1,761,179	)

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

18 | OPPENHEIMER HIGH INCOME FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	10,829,321		$	12,056,923
Net realized gain		688,171			6,278,337
Net change in unrealized appreciation/depreciation		(13,278,671	)		(249,331	)
Net increase (decrease) in net assets resulting from operations		(1,761,179	)		18,085,929
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(5,402,411	)		(3,674,586	)
Service shares		(5,518,442	)		(3,877,767	)
Class 3 shares		(555,527	)		(304,126	)
Class 4 shares		(704,748	)		(385,856	)
		(12,181,128	)		(8,242,335	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		(8,185,815	)		(10,126,348	)
Service shares		(2,768,423	)		(5,260,981	)
Class 3 shares		(1,395,931	)		929,124
Class 4 shares		485,879			(118,291	)
		(11,864,290	)		(14,576,496	)
Net Assets
Total decrease		(25,806,597	)		(4,732,902	)
Beginning of period		138,883,012			143,615,914
End of period (including accumulated net investment income of $10,456,939 and $11,799,334, respectively)	$	113,076,415		$	138,883,012

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

19 | OPPENHEIMER HIGH INCOME FUND / VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	2.13		$	1.98		$	1.58		$	7.95		$	8.55
Income (loss) from investment operations:
Net investment income2		.17			.18			.17			.54			.57
Net realized and unrealized gain (loss)		(.21	)		.10			.23			(6.44	)		(.56	)
Total from investment operations		(.04	)		.28			.40			(5.90	)		.01
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.19	)		(.13	)		—			(.47	)		(.61	)
Net asset value, end of period	$	1.90		$	2.13		$	1.98		$	1.58		$	7.95
Total Return, at Net Asset Value3		(2.34	)%		14.81	%		25.32	%		(78.67	)%		(0.10	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	47,500		$	61,563		$	67,385		$	111,040		$	294,819
Average net assets (in thousands)	$	54,997		$	59,598		$	71,782		$	211,186		$	335,702
Ratios to average net assets:4
Net investment income		8.55	%		9.01	%		9.78	%		9.30	%		6.96	%
Total expenses5		0.98	%		0.98	%		0.94	%		0.80	%		0.75	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.75	%		0.69	%		0.57	%		0.78	%		0.74	%
Portfolio turnover rate		54	%		132	%		128	%		53	%6		67	%6

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.98	%
Year Ended December 31, 2010	0.98	%
Year Ended December 31, 2009	0.96	%
Year Ended December 31, 2008	0.80	%
Year Ended December 31, 2007	0.76	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 31, 2008	$	40,240,084	$	41,196,921
Year Ended December 31, 2007	$	30,798,147	$	24,096,458

See accompanying Notes to Financial Statements.

20 | OPPENHEIMER HIGH INCOME FUND/VA

FINANCIAL HIGHLIGHTS Continued

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	2.14		$	1.99		$	1.58		$	7.89		$	8.50
Income (loss) from investment operations:
Net investment income2		.17			.17			.16			.54			.55
Net realized and unrealized gain (loss)		(.21	)		.10			.25			(6.40	)		(.57	)
Total from investment operations		(.04	)		.27			.41			(5.86	)		(.02	)
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.19	)		(.12	)		—			(.45	)		(.59	)
Net asset value, end of period	$	1.91		$	2.14		$	1.99		$	1.58		$	7.89
Total Return, at Net Asset Value3		(2.56	)%		14.44	%		25.95	%		(78.57	)%		(0.47	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	54,394		$	63,713		$	64,440		$	43,375		$	157,333
Average net assets (in thousands)	$	60,391		$	63,661		$	54,202		$	116,236		$	169,569
Ratios to average net assets:4
Net investment income		8.31	%		8.76	%		9.60	%		9.13	%		6.71	%
Total expenses5		1.23	%		1.23	%		1.21	%		1.05	%		1.01	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.00	%		0.94	%		0.80	%		1.03	%		1.00	%
Portfolio turnover rate		54	%		132	%		128	%		53	%6		67	%6

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.23	%
Year Ended December 31, 2010	1.23	%
Year Ended December 31, 2009	1.23	%
Year Ended December 31, 2008	1.05	%
Year Ended December 31, 2007	1.02	%

6. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 31, 2008	$	40,240,084	$	41,196,921
Year Ended December 31, 2007	$	30,798,147	$	24,096,458

See accompanying Notes to Financial Statements.

21 | OPPENHEIMER HIGH INCOME FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Class 3 Shares	20111			2010			2009			2008			20072
Per Share Operating Data
Net asset value, beginning of period	$	2.14		$	1.99		$	1.57		$	7.98		$	8.26
Income (loss) from investment operations:
Net investment income3		.17			.18			.17			.56			.37
Net realized and unrealized gain (loss)		(.20	)		.10			.25			(6.50	)		(.65	)
Total from investment operations		(.03	)		.28			.42			(5.94	)		(.28	)
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.19	)		(.13	)		—			(.47	)		—
Net asset value, end of period	$	1.92		$	2.14		$	1.99		$	1.57		$	7.98
Total Return, at Net Asset Value4		(1.88	)%		14.69	%		26.75	%		(78.89	)%		(3.39	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	4,034		$	6,034		$	4,684		$	1,582		$	4,921
Average net assets (in thousands)	$	5,432		$	5,279		$	3,568		$	5,292		$	3,750
Ratios to average net assets:5
Net investment income		8.52	%		8.97	%		9.86	%		9.29	%		6.90	%
Total expenses6		0.98	%		0.99	%		0.97	%		0.80	%		0.76	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.75	%		0.69	%		0.53	%		0.78	%		0.75	%
Portfolio turnover rate		54	%		132	%		128	%		53	%7		67	%7

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	For the period from May 1, 2007 (inception of offering) to December 31, 2007.
3.	Per share amounts calculated based on the average shares outstanding during the period.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.
6.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.98	%
Year Ended December 31, 2010	0.99	%
Year Ended December 31, 2009	0.99	%
Year Ended December 31, 2008	0.80	%
Period Ended December 31, 2007	0.77	%

7. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 31, 2008	$	40,240,084	$	41,196,921
Period Ended December 31, 2007	$	30,798,147	$	24,096,458

See accompanying Notes to Financial Statements.

22 | OPPENHEIMER HIGH INCOME FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Class 4 Shares	20111			2010			2009			2008			20072
Per Share Operating Data
Net asset value, beginning of period	$	2.16		$	2.01		$	1.59		$	7.97		$	8.26
Income (loss) from investment operations:
Net investment income3		.17			.18			.16			.54			.36
Net realized and unrealized gain (loss)		(.20	)		.09			.26			(6.46	)		(.65	)
Total from investment operations		(.03	)		.27			.42			(5.92	)		(.29	)
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.19	)		(.12	)		—			(.46	)		—
Net asset value, end of period	$	1.94		$	2.16		$	2.01		$	1.59		$	7.97
Total Return, at Net Asset Value4		(2.06	)%		14.27	%		26.42	%		(78.63	)%		(3.51	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	7,148		$	7,573		$	7,107		$	4,167		$	9,476
Average net assets (in thousands)	$	7,852		$	7,278		$	6,285		$	10,658		$	7,201
Ratios to average net assets:5
Net investment income		8.29	%		8.74	%		9.62	%		9.00	%		6.61	%
Total expenses6		1.23	%		1.23	%		1.19	%		1.07	%		1.05	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.00	%		0.94	%		0.80	%		1.05	%		1.04	%
Portfolio turnover rate		54	%		132	%		128	%		53	%7		67	%7

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	For the period from May 1, 2007 (inception of offering) to December 31, 2007.
3.	Per share amounts calculated based on the average shares outstanding during the period.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.
6.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.23	%
Year Ended December 31, 2010	1.23	%
Year Ended December 31, 2009	1.21	%
Year Ended December 31, 2008	1.07	%
Period Ended December 31, 2007	1.06	%

7. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 31, 2008	$	40,240,084	$	41,196,921
Period Ended December 31, 2007	$	30,798,147	$	24,096,458

See accompanying Notes to Financial Statements.

23 | OPPENHEIMER HIGH INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer High Income Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek a high level of current income from investment in high-yield, fixed-income securities. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

     The Fund offers Non-Service, Service, Class 3 and Class 4 shares. All classes are sold at their offering price, which is the net asset value per share, to separate investment accounts of participating insurance companies as an underlying investment for variable life insurance policies, variable annuity contracts or other investment products. The classes of shares being designated as Service shares and Class 4 shares are subject to a distribution and service plan. All classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. The Fund assesses a 1% fee on the proceeds of Class 3 and Class 4 shares that are redeemed (either by selling or exchanging to another Oppenheimer fund or other investment option offered through your variable life insurance or variable annuity contract) within 60 days of their purchase. The fee, which is retained by the Fund, is accounted for as an addition to paid-in capital.

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based

24 | OPPENHEIMER HIGH INCOME FUND/VA

upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. As of December 30, 2011, the Manager determined the fair value of certain common stock at the last traded price. For certain common stock and related preferred stock, both of which do not trade, the Manager has determined the fair value of these securities using internal models that utilize quarterly financial statements and manager assumptions using comparable security inputs. For certain warrants received in a bankruptcy reorganization that do not trade, the Manager has determined the fair value of these securities based on the residual value of the original bonds. Such investments have been classified as Level 3 instruments.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Securities on a When-Issued or Delayed Delivery Basis. The Fund may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis normally takes place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of the Fund’s net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. When the Fund engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain or dispose of the security at a price and yield it considers advantageous. The Fund may also sell securities that it purchased on a when-issued basis or forward commitment prior to settlement of the original purchase.

As of December 30, 2011, the Fund had purchased securities issued on a when-issued or delayed delivery basis as follows:

	When-Issued or Delayed
	Delivery Basis Transactions
Purchased securities	$	3,051,790

Credit Risk. The Fund invests in high-yield, non-investment-grade bonds, which may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Fund may acquire securities that have missed an interest payment, and is not obligated to dispose of securities whose issuers or underlying obligors subsequently miss an interest payment. Information concerning securities not accruing interest as of December 30, 2011 is as follows:

Cost	$	975,916
Market Value	$	771,238
Market Value as a % of Net Assets		0.68	%

25 | OPPENHEIMER HIGH INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Depreciation
					Based on Cost
Undistributed	Undistributed		Accumulated		of Securities and Other
Net Investment	Long-Term		Loss		Investments for Federal
Income	Gain		Carryforward1,2,3,4,5		Income Tax Purposes
$10,661,122	$	—	$	222,009,823	$	13,406,221

1. As of December 30, 2011, the Fund had $220,562,166 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2012	$	128,504
2016		48,495,519
2017		171,938,143
Total	$	220,562,166

2.	As of December 30, 2011, the Fund had $1,447,657 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund utilized $1,949,628 of capital loss carryforward to offset capital gains realized in that fiscal year.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $4,432,223 of capital loss carryforward to offset capital gains realized in that fiscal year.
5.	During the fiscal year ended December 30, 2011, $6,579,675 of unused capital loss carryforward expired.

26 | OPPENHEIMER HIGH INCOME FUND/VA

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

			Reduction
	Increase		to Accumulated
Reduction	to Accumulated Net		Net Realized Loss
to Paid-in Capital	Investment Income		on Investments
$6,579,675	$	9,412	$	6,570,263

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	12,181,128	$	8,242,335

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	127,393,293
Federal tax cost of other investments		60,827
Total federal tax cost	$	127,454,120
Gross unrealized appreciation	$	2,140,166
Gross unrealized depreciation		(15,546,387	)
Net unrealized depreciation	$	(13,406,221	)

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

27 | OPPENHEIMER HIGH INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		4,435,498		$	8,942,368			11,152,476		$	21,983,381
Dividends and/or distributions reinvested		2,648,241			5,402,411			1,954,567			3,674,586
Redeemed		(11,071,648	)		(22,530,594	)		(18,147,101	)		(35,784,315	)
Net decrease		(3,987,909	)	$	(8,185,815	)		(5,040,058	)	$	(10,126,348	)
Service Shares
Sold		3,015,631		$	6,027,667			2,939,505		$	5,849,488
Dividends and/or distributions reinvested		2,691,923			5,518,442			2,040,930			3,877,767
Redeemed		(7,087,393	)		(14,314,532	)		(7,528,455	)		(14,988,236	)
Net decrease		(1,379,839	)	$	(2,768,423	)		(2,548,020	)	$	(5,260,981	)

28 | OPPENHEIMER HIGH INCOME FUND/VA

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Class 3 Shares
Sold		805,055		$	1,675,197			2,054,702		$	4,093,320
Dividends and/or distributions reinvested		269,673			555,527			160,066			304,126
Redeemed		(1,789,726	)		(3,626,655	)1		(1,747,107	)		(3,468,322	)2
Net increase (decrease)		(714,998	)	$	(1,395,931	)		467,661		$	929,124
Class 4 Shares
Sold		1,952,890		$	4,030,364			1,725,510		$	3,440,558
Dividends and/or distributions reinvested		338,821			704,748			200,967			385,856
Redeemed		(2,103,972	)		(4,249,233	)1		(1,958,189	)		(3,944,705	)2
Net increase (decrease)		187,739		$	485,879			(31,712	)	$	(118,291	)

1.	Net of redemption fees of $621 and $235 for Class 3 and Class 4 shares, respectively.
2.	Net of redemption fees of $3,684 and $7,734 for Class 3 and Class 4 shares, respectively.

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	61,907,194	$	77,618,929

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Next $200 million	0.60
Over $1 billion	0.50

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $130,775 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares and Class 4 Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares and Class 4 shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares and Class 4 shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares and Class 4 shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares and Class 4 shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares and Class 4 shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

29 | OPPENHEIMER HIGH INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

4. Fees and Other Transactions with Affiliates Continued

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.75% for Non-Service and Class 3 shares and 1.00% for Service and Class 4 shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $124,994, $137,948, $12,207 and $17,865 for Non-Service, Service, Class 3 and Class 4 shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $5,434 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

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Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV.

The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for as Hedging Instruments	Investments from unaffiliated companies*		Swap contracts			Total
Credit contracts	$	—	$	(48,715	)	$	(48,715	)
Interest rate contracts		1,901		—			1,901
Total	$	1,901	$	(48,715	)	$	(46,814	)

* Includes purchased option contracts, purchased swaption contracts and written option contracts exercised, if any.

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NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

Option Activity

The Fund may buy and sell put and call options, or write put and call options. When an option is written, the Fund receives a premium and becomes obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option.

     Options are valued daily based upon the last sale price on the principal exchange on which the option is traded. The difference between the premium received or paid, and market value of the option, is recorded as unrealized appreciation or depreciation. The net change in unrealized appreciation or depreciation is reported in the Statement of Operations. When an option is exercised, the cost of the security purchased or the proceeds of the security sale are adjusted by the amount of premium received or paid. Upon the expiration or closing of the option transaction, a gain or loss is reported in the Statement of Operations.

     The Fund has purchased put options on treasury futures to decrease exposure to interest rate risk. A purchased put option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $144 on purchased put options.

     Options written, if any, are reported in a schedule following the Statement of Investments and as a liability in the Statement of Assets and Liabilities. Securities held in collateralized accounts to cover potential obligations with respect to outstanding written options are noted in the Statement of Investments.

     The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk that there may be an illiquid market where the Fund is unable to close the contract.

Additional associated risks to the Fund include counterparty credit risk for over-the-counter options and liquidity risk. As of December 30, 2011, the Fund did not have any outstanding options.

Swap Contracts

The Fund may enter into swap contract agreements with a counterparty to exchange a series of cash flows based on either specified reference rates, or the occurrence of a credit event, over a specified period. Such contracts may include interest rate, equity, debt, index, total return, credit and currency swaps.

     Swaps are marked to market daily using primarily quotations from pricing services, counterparties and brokers. Swap contracts are reported on a schedule following the Statement of Investments. The values of swap contracts are aggregated by positive and negative values and disclosed separately on the Statement of Assets and Liabilities by contracts in unrealized appreciation and depreciation positions. Upfront payments paid or received, if any, affect the value of the respective swap. Therefore, to determine the unrealized appreciation (depreciation) on swaps, upfront payments paid should be subtracted from, while upfront payments received should be added to, the value of contracts reported as an asset on the Statement of Assets and Liabilities. Conversely, upfront payments paid should be added to, while upfront payments received should be subtracted from the value of contracts reported as a liability. The unrealized appreciation (depreciation) related to the change in the valuation of the notional amount of the swap is combined with the accrued interest due to (owed by) the Fund at termination or settlement. The net change in this amount during the period is included on the Statement of Operations. The Fund also records any periodic payments received from (paid to) the counterparty, including at termination, under such contracts as realized gain (loss) on the Statement of Operations.

     Swap contract agreements are exposed to the market risk factor of the specific underlying reference asset. Swap contracts are typically more attractively priced compared to similar investments in related cash securities because they isolate the risk to one market risk factor and eliminate the other market risk factors. Investments in cash securities

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(for instance bonds) have exposure to multiple risk factors (credit and interest rate risk). Because swaps require little or no initial cash investment, they can expose the Fund to substantial risk in the isolated market risk factor.

     Credit Default Swap Contracts. A credit default swap is a bilateral contract that enables an investor to buy or sell protection on a debt security against a defined-issuer credit event, such as the issuer’s failure to make timely payments of interest or principal on the debt security, bankruptcy or restructuring. The Fund may enter into credit default swaps either by buying or selling protection on a single security or a basket of securities (the “reference asset”).

     The buyer of protection pays a periodic fee to the seller of protection based on the notional amount of debt securities underlying the swap contract. The seller of protection agrees to compensate the buyer of protection for future potential losses as a result of a credit event on the reference asset. The contract effectively transfers the credit event risk of the reference asset from the buyer of protection to the seller of protection.

     The ongoing value of the contract will fluctuate throughout the term of the contract based primarily on the credit risk of the reference asset. If the credit quality of the reference asset improves relative to the credit quality at contract initiation, the buyer of protection may have an unrealized loss greater than the anticipated periodic fee owed. This unrealized loss would be the result of current credit protection being cheaper than the cost of credit protection at contract initiation. If the buyer elects to terminate the contract prior to its maturity, and there has been no credit event, this unrealized loss will become realized. If the contract is held to maturity, and there has been no credit event, the realized loss will be equal to the periodic fee paid over the life of the contract.

     If there is a credit event, the buyer of protection can exercise its rights under the contract and receive a payment from the seller of protection equal to the notional amount of the reference asset less the market value of the reference asset. Upon exercise of the contract the difference between the value of the underlying reference asset and the notional amount is recorded as realized gain (loss) and is included on the Statement of Operations.

     The Fund has sold credit protection through credit default swaps to increase exposure to the credit risk of individual securities and/or, indexes that are either unavailable or considered to be less attractive in the bond market.

     The Fund has purchased credit protection through credit default swaps to decrease exposure to the credit risk of individual securities and/or, indexes.

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $31,538 and $88,462 on credit default swaps to buy protection and credit default swaps to sell protection, respectively.

Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

As of December 30, 2011, the Fund had no such credit default swaps outstanding.

6. Restricted Securities

As of December 30, 2011, investments in securities included issues that are restricted. A restricted security may have a contractual restriction on its resale and is valued under methods approved by the Board of Trustees as reflecting fair value. Securities that are restricted are marked with an applicable footnote on the Statement of Investments. Restricted securities are reported on a schedule following the Statement of Investments.

7. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations

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NOTES TO FINANCIAL STATEMENTS Continued

7. Pending Litigation Continued and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including

34 | OPPENHEIMER HIGH INCOME FUND/VA

attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer High Income Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer High Income Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer High Income Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

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FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 1.23% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

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BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio manager and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Joseph Welsh, the portfolio manager for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

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     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other high current yield funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-year Lipper period, although the Fund underperformed its performance universe median during the three-, five-, and ten-year Lipper periods. The Board also considered the appointment of a new portfolio manager and the High Yield Corporate Debt Team in April 2009 to oversee the Fund’s investments. The Board considered the Manager’s assertion that the portfolio manager gradually has re-positioned the Fund to better take advantage of market conditions. The Board considered the Fund’s recent improved performance, noting it had ranked in the first quintile for the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other high current yield funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and its total expenses were lower than its expense group median. The Board also considered that the Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.75% for Non-Service and Class 3 shares and 1.00% for Service and Class 4 shares. This voluntary expense limitation may not be amended or withdrawn until one year after the date of prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates. The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

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PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

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TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital

41 | OPPENHEIMER HIGH INCOME FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Beverly L. Hamilton, Continued	(2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004- 2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004- March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006- September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008- June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006- December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

42 | OPPENHEIMER HIGH INCOME FUND/VA

OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Mr. Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Welsh, Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Joseph Welsh, Vice President (since 2009) Age: 47	Head of the Manager’s High Yield Corporate Debt Team (since April 2009); Senior Vice President of the Manager (since May 2009); Vice President of the Manager (December 2000-April 2009); Assistant Vice President of the Manager (December 1996-November 2000); a high yield bond analyst of the Manager (January 1995- December 1996); a CFA. A portfolio manager and officer of 6 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005- April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

43 | OPPENHEIMER HIGH INCOME FUND/VA

OPPENHEIMER HIGH INCOME FUND/VA

A Series of Oppenheimer Variable Account Funds
Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG LLP
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

^©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011 Oppenheimer Main Street Fund^®/VA            Annual Report A Series of Oppenheimer Variable Account Funds

ANNUAL REPORT Listing of Top Holdings Fund Performance Discussion Financial Statements

OPPENHEIMER MAIN STREET FUND ^®/ VA

Portfolio Managers: Manind (“Mani”) Govil, CFA and Benjamin Ram

Average Annual Total Returns
For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		–0.01	%		–0.88	%		2.77	%
Service Shares		–0.32	%		–1.13	%		2.51	%

Expense Ratios
For the Period Ended 12/30/11¹

Non-Service Shares	0.78	%
Service Shares	1.03

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

Sector Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of common stocks.

Top Ten Common Stock Holdings
Apple, Inc.	6.6	%
Chevron Corp.	5.0
Philip Morris International, Inc.	4.2
Abbott Laboratories	3.6
eBay, Inc.	3.5
McGraw-Hill Cos., Inc. (The)	3.3
CIT Group, Inc.	3.3
Google, Inc., Cl. A	3.2
Ford Motor Co.	2.8
Tyco International Ltd.	2.7

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER MAIN STREET FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of —0.01% for the reporting period ended December 30, 2011.1 On a relative basis, the Fund underperformed the S&P 500 Index (the “Index”), which returned 2.11%. Virtually all of the Fund’s relative underperformance occurred during the first quarter of 2011 when the market was driven upward by strong momentum, somewhat irrespective, in our opinion, of underlying fundamentals or valuation. During the reporting period, underperformance relative to the Index was primarily due to unfavorable stock selections within the financials sector. Favorable stock selections within the information technology, energy and consumer staples sectors contributed positively to relative performance.

Economic and Market Overview

Last calendar year proved to be challenging. The environment was characterized by geopolitical uncertainties, fits and starts in economic news (both domestically and internationally), climatic catastrophes, and emotions which waivered erratically between strong optimism about an economic recovery and fears about a global recession. At the end of the day, U.S. equities finished little changed from twelve months prior, but the ride between points was a roller coaster.

     We entered 2011 with a note of optimism. Indeed, the first quarter was very momentum driven as investors drove stocks higher, somewhat irrespective of underlying fundamentals or valuation. However, come the reporting of first quarter earnings, concerns over the world’s outlook began to rise. We witnessed the “Arab Spring”; a tragedy in Japan—one that was not only tragic for many but also highly disruptive to manufacturing globally; and a burgeoning European financial crisis that threatened to reach well beyond the borders of the Eurozone.

     News from our own shores, too, was uneven. Though employment growth remained stubbornly below levels normally experienced in past recoveries and weakness in the housing market persisted, reported earnings by companies across sectors generally were topping expectations. Additionally, companies were hoarding cash, building considerable financial strength to fund continued growth. But with the specter of contagion from Europe and uncertainty about the growth trajectory of emerging markets, investors fled equities—especially those of lower quality or with high economic sensitivities. The political impasse in Washington during the summer over whether to raise the debt ceiling resulted in an unprecedented downgrade of the U.S. Government’s debt rating and exacerbated market anxiety.

     The fourth quarter was quite the reversal from the third quarter’s market trends. Sectors which had been hit hard, particularly economically sensitive sectors, were among the better performing ones. Though Europe made little headway in resolving its deep-seated structural and financial problems, investors seemed calmer about an eventual settlement. And, almost lost among all the noise from overseas were periodic reports of modest domestic improvements in employment, consumer sentiment and in other areas. Throughout much of 2011 two trends remained fairly consistent. One, financial stocks suffered. Despite generally rising earnings and vastly improved balance sheets, the market voiced its concerns about the increasing possibility of another 2008-style financial crisis. Virtually all segments of the sector sold down dramatically, with collapsing valuations which, in some instances, fell below book value.

     The second trend was that stocks of well-managed companies with solid business models generally outperformed as the year progressed. Especially during times of macroeconomic uncertainty, investors generally value companies that deliver consistent results. Last year was a market often characterized by a “flight to quality” as investors sought shelter in stocks that had a low likelihood of surprising negatively. We believe a market that pays close attention to the underlying fundamentals of higher quality stocks is favorable for the investment style of the Main Street Team.

Top Individual Contributors

Apple, Inc., Chevron Corp. and Phillip Morris International, Inc., the top three holdings of the Fund at period end, were also among the strongest performers this reporting period. Apple continued to out-execute its peers. The company’s continued success at innovation and its highly recognizable brand led to global growth and share gains across its top revenue producing products—iPhones, iPads and Mac PCs. Phillip Morris International, Inc. continued to generate substantial

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER MAIN STREET FUND/VA

FUND PERFORMANCE DISCUSSION

free cash flow stemming from ongoing market share gains and its considerable ability to raise prices. Chevron announced a new natural discovery by its Australian unit and outlined plans for 2012 to be a year of major investment for the company in large natural gas-related exploration and production projects. The company also benefited from rising oil and gas prices.

     Other top performing holdings during the reporting period included pharmaceuticals firm Bristol-Myers Squibb Co. and publishing firm McGraw-Hill Cos., Inc. Bristol-Myers Squibb, which produces such drugs as Plavix and Abilify, benefited from recent trial results for Eliquis, an anticoagulant that showed “best in class” data for both stroke and major bleeding against the existing drug Warfarin. If approved by the FDA, Eliquis can be an important contributor to future revenue and profit growth at Bristol Myers Squibb. McGraw-Hill saw solid performance resulting from strong pricing power and growth in market share across its financial services division which includes Capital IQ and the S&P Indices. The company’s management has undertaken a business restructuring which has included the sale of media properties and the announced spin-off of the Education division. These actions, together with aggressive share repurchase and dividend increases, have also driven the stock price higher.

Top Individual Detractors

The top detractors from Fund performance were mostly in the financials sector. Investors became increasingly bearish towards financials as fears heightened due to a weakening global economy and an uncertain regulatory environment. A lack of transparency regarding the extent of exposure to both European bank and sovereign debt weighed heavily on stocks such as Citigroup, Inc. and JPMorgan Chase & Co. These holdings, together with Wells Fargo & Co., a stock we no longer own, were also negatively impacted by the ongoing high degree of home foreclosures and the razor thin net interest margins that have resulted from the persistence of historically low interest rates. CIT Group, Inc., too, hurt relative performance last year. Expectations that the domestic economy may fall back into a recession raised investor concerns over the timing and magnitude of CIT’s restructuring aimed at improving both its balance sheet strength and profitability.

     Beyond financials, Ford Motor Co. detracted from performance results. The auto industry suffered several set-backs during the year. Production costs were negatively impacted from soaring commodity prices and delivery disruptions from Japanese auto parts suppliers. Uncertainty about the health of the economy also tempered expectations for strong auto sales. Despite these hurdles, Ford successfully negotiated a new long-term union contract, which locks-in favorable labor costs, and re-initiated its dividend.

Outlook

At period end, we believe the U.S. economy will continue to improve at a gradual and perhaps uneven fashion. The slow-growth environment could create a bifurcated stock market in which well-run companies with solid business models outperform. We also believe that while cyclical stocks and companies with cyclical earnings have generally performed well as of late, this trend will eventually shift to the benefit of consistent, longer-term performers. If our expectations are correct, the current market environment could potentially favor our investment style and process, which focuses on companies with sustainable competitive advantages. We view such firms as well-positioned to generate stronger profit margins and take market share from weaker players. We seek to buy such companies when their valuations are attractive, and believe that this disciplined investment process is the key to generating solid long-term performance.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

4 | OPPENHEIMER MAIN STREET FUND/VA

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. Performance is measured over a ten-fiscal-year period for both Classes. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the S&P 500 Index, an unmanaged index of U.S. equity securities. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

5 | OPPENHEIMER MAIN STREET FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER MAIN STREET FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service Shares	$	1,000.00	$	972.70	$	3.82
Service Shares		1,000.00		971.60		5.05
Hypothetical
(5% return before expenses)
Non-Service Shares		1,000.00		1,021.21		3.91
Service Shares		1,000.00		1,019.95		5.18

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
|
Non-Service Shares		0.77	%
Service Shares		1.02

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER MAIN STREET FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—100.1%
Consumer Discretionary—11.3%
Automobiles—2.8%
Ford Motor Co.1		3,597,200	$	38,705,872
Hotels, Restaurants & Leisure—2.1%
Hyatt Hotels Corp., Cl. A1		512,288		19,282,520
McDonald’s Corp.		93,336		9,364,401
				28,646,921
Media—3.3%
McGraw-Hill Cos., Inc. (The)		1,038,811		46,715,331
Specialty Retail—3.1%
AutoZone, Inc.1		42,550		13,827,474
CarMax, Inc.1		249,930		7,617,866
TJX Cos., Inc. (The)		344,260		22,221,983
				43,667,323
Consumer Staples—11.1%
Beverages—2.4%
Dr. Pepper Snapple Group, Inc.		862,620		34,056,238
Food Products—4.5%
General Mills, Inc.		384,400		15,533,604
J.M. Smucker Co. (The)		339,750		26,558,258
Mead Johnson Nutrition Co., Cl. A		242,472		16,665,101
Sara Lee Corp.		214,480		4,057,962
				62,814,925
Tobacco—4.2%
Philip Morris International, Inc.		740,059		58,079,830
Energy—12.3%
Energy Equipment & Services—1.3%
National Oilwell Varco, Inc.		277,840		18,890,342
Oil, Gas & Consumable Fuels—11.0%
Chevron Corp.		662,489		70,488,830
Kinder Morgan, Inc.		576,310		18,539,893
Noble Energy, Inc.		321,000		30,299,190
Occidental Petroleum Corp.		360,130		33,744,181
				153,072,094
Financials—16.6%
Capital Markets—1.1%
Blackstone Group LP (The)		1,123,300		15,737,433
Commercial Banks—3.7%
CIT Group, Inc.1		1,304,640		45,492,797
M&T Bank Corp.		88,580		6,762,197
				52,254,994
Consumer Finance—1.4%
Discover Financial Services		794,510		19,068,240
Diversified Financial Services—6.8%
Citigroup, Inc.		1,103,709		29,038,584
CME Group, Inc.		85,050		20,724,134
JPMorgan Chase & Co.		1,111,860		36,969,345
MSCI, Inc., Cl. A1		225,280		7,418,470
				94,150,533
Insurance—3.6%
Berkshire Hathaway, Inc., Cl. B1		96,510		7,363,713
Marsh & McLennan Cos., Inc.		768,000		24,284,160
Progressive Corp.		976,210		19,045,857
				50,693,730
Health Care—13.5%
Biotechnology—2.5%
Celgene Corp.1		499,432		33,761,603
Health Care Providers &
Services—2.9%
DaVita, Inc.1		99,970		7,578,726
WellPoint, Inc.		497,580		32,964,675
				40,543,401
Life Sciences Tools & Services—1.2%
Waters Corp.1		228,410		16,913,761
Pharmaceuticals—6.9%
Abbott Laboratories		883,770		49,694,387
Allergan, Inc.		147,020		12,899,535
Bristol-Myers Squibb Co.		964,310		33,982,284
				96,576,206
Industrials—9.8%
Aerospace & Defense—2.2%
Boeing Co. (The)		407,210		29,868,854
Air Freight & Logistics—2.4%
United Parcel Service, Inc., Cl. B		458,000		33,521,020
Industrial Conglomerates—2.7%
Tyco International Ltd.		814,210		38,031,749
Machinery—0.5%
Xylem, Inc.		290,260		7,456,779
Road & Rail—2.0%
CSX Corp.		1,275,610		26,864,347
QR National Ltd.		439,800		1,538,407
				28,402,754

8 | OPPENHEIMER MAIN STREET FUND/VA

	Shares			Value
Information Technology—19.9%
Communications Equipment—2.5%
QUALCOMM, Inc.		641,851		$	35,109,250
Computers & Peripherals—6.6%
Apple, Inc.1		226,922			91,903,410
Internet Software & Services—6.7%
eBay, Inc.1		1,614,455			48,966,420
Google, Inc., Cl. A1		69,250			44,728,575
					93,694,995
Software—4.1%
Check Point Software Technologies Ltd.1		247,890			13,024,141
Microsoft Corp.		1,215,657			31,558,456
Oracle Corp.		478,290			12,268,139
					56,850,736
Materials—2.0%
Chemicals—1.7%
Praxair, Inc.		225,230			24,077,082
Construction Materials—0.3%
Vulcan Materials Co.		89,990			3,541,107
Telecommunication Services—2.1%
Wireless Telecommunication Services—2.1%
America Movil SAB de CV, ADR, Series L		1,302,422			29,434,737
Utilities—1.5%
Energy Traders—1.5%
AES Corp. (The)1		1,769,160			20,946,854
Total Investments, at Value (Cost $1,097,413,107)		100.1	%		1,397,188,104
Liabilities in Excess of Other Assets		(0.1	)		(1,142,965	)
Net Assets		100.0	%	$	1,396,045,139

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Non-income producing security.

The following issuer is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011 by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. There were no affiliate securities held by the Fund as of December 30, 2011. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		21,709,488		346,291,600		368,001,088		—

	Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	40,596

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1) Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)

2) Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)

3) Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

9 | OPPENHEIMER MAIN STREET FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3–
	Level 1–		Level 2–		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	157,735,447	$	—	$	—	$	157,735,447
Consumer Staples		154,950,993		—		—		154,950,993
Energy		171,962,436		—		—		171,962,436
Financials		231,904,930		—		—		231,904,930
Health Care		187,794,971		—		—		187,794,971
Industrials		137,281,156		—		—		137,281,156
Information Technology		277,558,391		—		—		277,558,391
Materials		27,618,189		—		—		27,618,189
Telecommunication Services		29,434,737		—		—		29,434,737
Utilities		20,946,854		—		—		20,946,854
Total Assets	$	1,397,188,104	$	—	$	—	$	1,397,188,104

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

10 | OPPENHEIMER MAIN STREET FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value (cost $1,097,413,107)—see accompanying statement of investments	$	1,397,188,104
Receivables and other assets:
Investments sold		5,146,954
Dividends		1,240,087
Other		66,345
Total assets		1,403,641,490
Liabilities
Bank overdraft		191,177
Payables and other liabilities:
Investments purchased		3,496,879
Shares of beneficial interest redeemed		3,289,111
Shareholder communications		235,774
Distribution and service plan fees		189,380
Transfer and shareholder servicing agent fees		119,165
Trustees’ compensation		38,860
Other		36,005
Total liabilities		7,596,351
Net Assets	$	1,396,045,139
Composition of Net Assets
Par value of shares of beneficial interest	$	67,825
Additional paid-in capital		1,460,842,471
Accumulated net investment income		4,690,401
Accumulated net realized loss on investments and foreign currency transactions		(369,330,555	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		299,774,997
Net Assets	$	1,396,045,139
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $392,860,646 and 18,970,441 shares of beneficial interest outstanding)	$	20.71
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $1,003,184,493 and 48,854,175 shares of beneficial interest outstanding)	$	20.53

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

11 | OPPENHEIMER MAIN STREET FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $25,083)	$	23,791,054
Affiliated companies		40,596
Interest		966
Total investment income		23,832,616
Expenses
Management fees		9,967,881
Distribution and service plan fees—Service shares		2,736,862
Transfer and shareholder servicing agent fees:
Non-Service shares		426,553
Service shares		1,094,745
Shareholder communications:
Non-Service shares		46,649
Service shares		119,403
Trustees’ compensation		62,646
Custodian fees and expenses		8,713
Administration service fees		1,500
Other		87,403
Total expenses		14,552,355
Less waivers and reimbursements of expenses		(22,856	)
Net expenses		14,529,499
Net Investment Income		9,303,117
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments from unaffiliated companies		60,130,397
Foreign currency transactions		(118,065	)
Net realized gain		60,012,332
Net change in unrealized appreciation/depreciation on:
Investments		(72,248,813	)
Translation of assets and liabilities denominated in foreign currencies		68,522
Net change in unrealized appreciation/depreciation		(72,180,291	)
Net Decrease in Net Assets Resulting from Operations	$	(2,864,842	)

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

12 | OPPENHEIMER MAIN STREET FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	9,303,117		$	12,343,744
Net realized gain		60,012,332			122,769,693
Net change in unrealized appreciation/depreciation		(72,180,291	)		110,123,026
Net increase (decrease) in net assets resulting from operations		(2,864,842	)		245,236,463
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(3,755,987	)		(5,119,114	)
Service shares		(6,566,777	)		(11,011,249	)
		(10,322,764	)		(16,130,363	)
Beneficial Interest Transactions
Net decrease in net assets resulting from beneficial interest transactions:
Non-Service shares		(73,098,026	)		(66,941,748	)
Service shares		(172,844,897	)		(135,835,930	)
		(245,942,923	)		(202,777,678	)
Net Assets
Total increase (decrease)		(259,130,529	)		26,328,422
Beginning of period		1,655,175,668			1,628,847,246
End of period (including accumulated net investment income of $4,690,401 and $13,277,741, respectively)	$	1,396,045,139		$	1,655,175,668

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

13 | OPPENHEIMER MAIN STREET FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	20.88		$	18.18		$	14.56		$	25.61		$	24.78
Income (loss) from investment operations:
Net investment income2		.16			.17			.21			.29			.33
Net realized and unrealized gain (loss)		(.16	)		2.73			3.71			(9.64	)		.75
Total from investment operations		—			2.90			3.92			(9.35	)		1.08
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.17	)		(.20	)		(.30	)		(.32	)		(.25	)
Distributions from net realized gain		—			—			—			(1.38	)		—
Total dividends and/or distributions to shareholders		(.17	)		(.20	)		(.30	)		(1.70	)		(.25	)
Net asset value, end of period	$	20.71		$	20.88		$	18.18		$	14.56		$	25.61
Total Return, at Net Asset Value3		(0.01	)%		16.11	%		28.29	%		(38.47	)%		4.43	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	392,861		$	469,720		$	474,637		$	432,360		$	907,727
Average net assets (in thousands)	$	426,354		$	454,937		$	430,517		$	670,994		$	1,006,655
Ratios to average net assets:4
Net investment income		0.79	%		0.93	%		1.35	%		1.42	%		1.28	%
Total expenses5		0.78	%		0.78	%		0.78	%		0.66	%		0.65	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.78	%		0.78	%		0.78	%		0.66	%		0.65	%
Portfolio turnover rate		38	%		45	%		128	%		132	%		111	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.78	%
Year Ended December 31, 2010	0.78	%
Year Ended December 31, 2009	0.78	%
Year Ended December 31, 2008	0.66	%
Year Ended December 31, 2007	0.65	%

See accompanying Notes to Financial Statements.

14 | OPPENHEIMER MAIN STREET FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	20.71		$	18.04		$	14.42		$	25.38		$	24.58
Income (loss) from investment operations:
Net investment income2		.11			.13			.17			.24			.26
Net realized and unrealized gain (loss)		(.17	)		2.70			3.70			(9.56	)		.75
Total from investment operations		(.06	)		2.83			3.87			(9.32	)		1.01
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.12	)		(.16	)		(.25	)		(.26	)		(.21	)
Distributions from net realized gain		—			—			—			(1.38	)		—
Total dividends and/or distributions to shareholders		(.12	)		(.16	)		(.25	)		(1.64	)		(.21	)
Net asset value, end of period	$	20.53		$	20.71		$	18.04		$	14.42		$	25.38
Total Return, at Net Asset Value3		(0.32	)%		15.83	%		27.99	%		(38.63	)%		4.15	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	1,003,184		$	1,185,456		$	1,154,210		$	1,020,103		$	1,464,690
Average net assets (in thousands)	$	1,094,254		$	1,193,630		$	1,029,909		$	1,268,430		$	1,315,488
Ratios to average net assets:4
Net investment income		0.54	%		0.68	%		1.10	%		1.20	%		1.03	%
Total expenses5		1.03	%		1.03	%		1.03	%		0.91	%		0.90	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.03	%		1.03	%		1.03	%		0.91	%		0.90	%
Portfolio turnover rate		38	%		45	%		128	%		132	%		111	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.03	%
Year Ended December 31, 2010	1.03	%
Year Ended December 31, 2009	1.03	%
Year Ended December 31, 2008	0.91	%
Year Ended December 31, 2007	0.90	%

See accompanying Notes to Financial Statements.

15 | OPPENHEIMER MAIN STREET FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Main Street Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek high total return. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

16 | OPPENHEIMER MAIN STREET FUND/VA

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

17 | OPPENHEIMER MAIN STREET FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Appreciation
					Based on Cost of
Undistributed	Undistributed		Accumulated		Securities and Other
Net Investment	Long-Term		Loss		Investments for Federal
Income	Gain		Carryforward1,2,3,4		Income Tax Purposes
$4,457,825	$	—	$	365,662,510	$	296,378,380

1. As of December 30, 2011, the Fund had $360,688,381 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2016	$	28,492,724
2017		332,195,657
Total	$	360,688,381

2.	As of December 30, 2011, the Fund had $4,974,129 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund utilized $71,694,516 of capital loss carryforward to offset capital gains realized in that fiscal year.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $117,805,966 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Reduction		Reduction
	to Accumulated		to Accumulated Net
Increase to	Net Investment		Realized Loss
Paid-in Capital	Income		on Investments
$303,331	$	7,567,693	$	7,264,362

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	10,322,764	$	16,130,363

18 | OPPENHEIMER MAIN STREET FUND/VA

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	1,100,809,724
Gross unrealized appreciation	$	330,799,821
Gross unrealized depreciation		(34,421,441	)
Net unrealized appreciation	$	296,378,380

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

19 | OPPENHEIMER MAIN STREET FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		2,028,214		$	41,337,389			2,851,462		$	52,574,153
Dividends and/or distributions reinvested		176,503			3,755,987			279,275			5,119,114
Redeemed		(5,726,116	)		(118,191,402	)		(6,743,462	)		(124,635,015	)
Net decrease		(3,521,399	)	$	(73,098,026	)		(3,612,725	)	$	(66,941,748	)
Service Shares
Sold		2,150,725		$	42,852,883			7,702,331		$	136,115,255
Dividends and/or distributions reinvested		310,633			6,566,777			604,682			11,011,249
Redeemed		(10,851,128	)		(222,264,557	)		(15,049,192	)		(282,962,434	)
Net decrease		(8,389,770	)	$	(172,844,897	)		(6,742,179	)	$	(135,835,930	)

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	567,679,021	$	792,267,202

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $1,542,614 to OFS for services to the Fund.

20 | OPPENHEIMER MAIN STREET FUND/VA

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $22,856 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

Interest Rate Risk. Interest rate risk refers to the fluctuations in value of fixed-income securities resulting from the inverse relationship between price and yield. For example, an increase in general interest rates will tend to reduce

21 | OPPENHEIMER MAIN STREET FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5.

Risk Exposures and the Use of Derivative Instruments Continued the market value of already issued fixed-income investments, and a decline in general interest rates will tend to increase their value. In addition, debt securities with longer maturities, which tend to have higher yields, are subject to potentially greater fluctuations in value from changes in interest rates than obligations with shorter maturities.

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for as Hedging Instruments	Foreign currency transactions
Foreign exchange contracts	$	977

22 | OPPENHEIMER MAIN STREET FUND/VA

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions, respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $51,915 and $26,942, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

     As of December 30, 2011, the Fund had no outstanding forward contracts.

6. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

23 | OPPENHEIMER MAIN STREET FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

6. Pending Litigation Continued

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

24 | OPPENHEIMER MAIN STREET FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Main Street Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Main Street Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Main Street Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp
Denver, Colorado
February 16, 2012

25 | OPPENHEIMER MAIN STREET FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 100% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

26 | OPPENHEIMER MAIN STREET FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT
ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Manind Govil and Benjamin Ram, the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

27 | OPPENHEIMER MAIN STREET FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT
ADVISORY AGREEMENT Unaudited / Continued

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other large-cap core funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-, three-, five-, and ten-year Lipper periods. The Board also considered the change, effective May 19, 2009, of a new portfolio management team.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other large-cap core funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees were lower than its expense group median, although its total expenses were higher than its expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. This voluntary expense limitation may be amended or withdrawn at any time.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

28 | OPPENHEIMER MAIN STREET FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

29 | OPPENHEIMER MAIN STREET FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1995) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex.

30 | OPPENHEIMER MAIN STREET FUND/VA

Beverly L. Hamilton, Continued	Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004- March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006- September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008- June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006- December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

31 | OPPENHEIMER MAIN STREET FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Govil, Ram, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Manind Govil, Vice President (since 2009) Age: 42	Senior Vice President and the Main Street Team Leader of the Manager (since May 2009); a Chartered Financial Analyst. Prior to joining the Manager, managed the RS Largecap Alpha fund (August 2005-March 2009) first with Guardian Life Insurance Company of America then with RS Investment Management Co. LLC, subsequent to their merger; head of equity investments at The Guardian Life Insurance Company of America (August 2005- October 2006) when Guardian Life Insurance acquired an interest in RS Investment Management Co. LLC; lead portfolio manager — large cap blend/core equity, co-head of equities and head of equity research (2001-July 2005); lead portfolio manager — core equity (April 1996-July 2005), at Mercantile Capital Advisers, Inc. A portfolio manager and officer of 4 portfolios in the OppenheimerFunds complex.
Benjamin Ram, Vice President (since 2009) Age: 39	Vice President of the Manager (since May 2009). Prior to joining the Manager, a sector manager for financial investments and a co-portfolio manager for mid-cap portfolios with the RS Core Equity Team of RS Investment Management Co. LLC (January 2006-May 2009) first with Guardian Life Insurance Company of America then with RS Investment Management Co. LLC, subsequent to their merger; a financials analyst (2003-2005) and co-portfolio manager (2005-2006) at Mercantile Capital Advisers, Inc; a bank analyst at Legg Mason Securities (2000-2003); a senior financial analyst at the CitiFinancial division of Citigroup, Inc. (1997-2000). A portfolio manager and officer of 3 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

32 | OPPENHEIMER MAIN STREET FUND/VA

OPPENHEIMER MAIN STREET FUND ^®/ VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND^®/VA

Portfolio Managers: Matthew P. Ziehl, CFA; Raymond Anello, CFA; and Raman Vardharaj, CFA

Average Annual Total Returns

For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		-2.21	%		0.34	%		6.44	%
Service Shares		-2.38	%		0.10	%		6.22	%

Expense Ratios

For the Period Ended 12/30/11¹

	Gross			Net
	Expense			Expense
	Ratios			Ratios
Non-Service Shares		0.83	%		0.80	%
Service Shares		1.08			1.05

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Sector Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of common stocks.

Top Ten Common Stock Holdings
Robert Half International, Inc.	1.7	%
HollyFrontier Corp.	1.6
Questcor Pharmaceuticals, Inc.	1.5
Old Dominion Freight Line, Inc.	1.4
AES Corp. (The)	1.4
Digital Realty Trust, Inc.	1.2
MSCI, Inc., Cl. A	1.2
PVH Corp.	1.2
KBR, Inc.	1.1
Toll Brothers, Inc.	1.1

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of —2.21% for the year ended December 30, 2011, modestly outperforming the Russell 2500 Index (the “Index”) which returned —2.51%.1 The Fund outperformed the Index primarily in the health care sector, due to strong relative stock selection and underperformed primarily in the utilities sector due largely to less favorable stock selection.

Economic and Market Overview

Last calendar year proved to be challenging. The environment was characterized by geopolitical uncertainties, fits and starts in economic news (both domestically and internationally), climatic catastrophes, and emotions which waivered erratically between strong optimism about an economic recovery and fears about a global recession. At the end of the day, U.S. equities finished little changed from twelve months prior, but the ride between points was a roller coaster.

     We entered 2011 with a note of optimism. Indeed, the first quarter was very momentum driven as investors drove stocks higher, somewhat irrespective of underlying fundamentals or valuation. However, come the reporting of first quarter earnings, concerns over the world’s outlook began to rise. We witnessed the “Arab Spring”; a tragedy in Japan—one that was not only tragic for many but also highly disruptive to manufacturing globally; and a burgeoning European financial crisis that threatened to reach well beyond the borders of the Eurozone.

     News from our own shores, too, was uneven. Though employment growth remained stubbornly below levels normally experienced in past recoveries and weakness in the housing market persisted, reported earnings by companies across sectors generally were topping expectations. Additionally, companies were hoarding cash, building considerable financial strength to fund continued growth. But with the specter of contagion from Europe and uncertainty about the growth trajectory of emerging markets, investors fled equities—especially those of lower quality or with high economic sensitivities. The political impasse in Washington during the summer over whether to raise the debt ceiling resulted in an unprecedented downgrade of the U.S. Government’s debt rating and exacerbated market anxiety.

     The fourth quarter was quite the reversal from the third quarter’s market trends. Sectors which had been hit hard, particularly economically sensitive sectors, were among the better performing ones. Though Europe made little headway in resolving its deep-seated structural and financial problems, investors seemed calmer about an eventual settlement. And, almost lost among all the noise from overseas were periodic reports of modest domestic improvements in employment, consumer sentiment and in other areas.

     Throughout much of 2011 two trends remained fairly consistent. One, financial stocks suffered. Despite generally rising earnings and vastly improved balance sheets, the market voiced its concerns about the increasing possibility of another 2008-style financial crisis. Virtually all segments of the sector sold down dramatically, with collapsing valuations which, in some instances, fell below book value.

     The second trend was that stocks of well-managed companies with solid business models generally outperformed as the year progressed. Especially during times of macroeconomic uncertainty, investors generally value companies that deliver consistent results. Last year was a market often characterized by a “flight to quality” as investors sought shelter in stocks that had a low likelihood of surprising negatively. We believe a market that pays close attention to the underlying fundamentals of higher quality stocks is favorable for the investment style of the Main Street Team.

Top Individual Contributors

During the period, the Fund’s top two performing holdings were in the health care sector: health insurer Healthspring, Inc. and drug maker Questcor Pharmaceuticals, Inc. Healthspring enjoyed strong results from its Medicare Advantage plan and, in late October, announced that it had agreed to be purchased by health care provider Cigna for $3.8 billion. Questcor Pharmaceuticals benefited from a significant rise in new paid prescriptions for its Athcar drug for patients with multiple-sclerosis as well as patients with Nephrotic syndrome, which is a kidney disorder.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FUND PERFORMANCE DISCUSSION

     Another top contributor to Fund performance during the period was semiconductor company NetLogic Microsystems, Inc. In September, Broadcom Corp. agreed to purchase NetLogic for $50 per share, a 57% premium to the stock’s prior day close. In the real estate sector, Digital Realty Trust, Inc. was a top contributor to Fund performance. Digital Realty Trust owns, acquires, develops and manages technology-related real estate for customers providing internet and telecom services, as well as corporate enterprise data center tenants. With the explosive growth of transmitted data—especially over wireless networks—demand for Digital Realty’s data center capabilities has been strong.

     Energy stock HollyFrontier Corp. contributed positively to results. In the first quarter, Holly Corporation and Frontier Oil, two large oil refiners, issued a statement that they had agreed upon an all-stock merger that would give the company a value of approximately $7 billion and would create one of the biggest oil refiners in the western U.S. The stock rose on the news and the impending completion of the merger, which was completed in July 2011. The Fund continued to hold HollyFrontier at period end. Also performing well for the Fund was a more defensive play in the trucking industry. Old Dominion Freight Line, Inc. had a strong reporting period, with higher revenues and higher earnings. Tractor Supply Co., the largest retail operator in the U.S. of farm and ranch-related equipment and supplies with over 1,000 stores, also performed positively for the Fund due to strong sales and increased demand for its livestock and pet products.

Top Individual Detractors

The Fund’s weakest performing holdings during the period were financials sector stocks MGIC Investment Corp. and MF Global Holdings Ltd. MGIC Investment is a holding company that provides mortgage insurance coverage in the U.S. through its subsidiaries. The company reported losses due to continued weakness in the housing market and market pessimism over the timing of a potential rebound in housing. We exited our position by period end. MF Global’s exposure to the European debt crisis resulted in its stock being pushed lower over the summer. Market fears about the stability of the Eurozone and the possibility of either a Greek or Italian default hammered bank stocks deemed to have significant exposure to the European banking system, including MF Global, which ultimately filed for bankruptcy protection. We exited our position prior to that event, limiting the degree of loss.

     Within information technology, the Fund’s position in Skyworks Solutions, Inc. detracted from results. Information technology stocks, including stocks of semiconductor companies, generally did not perform well during the period. Valuations of information technology companies dropped to their lowest levels in more than a decade at one point in the period, reflecting market fear over a faltering global economic recovery and a potential drop in consumer demand for technological goods and services. In health care, Salix Pharmaceuticals’ shares fell after the FDA prevented the company from using its best-selling drug Xifaxan for irritable bowel syndrome. We exited our position.

Outlook

At period end, we believe the U.S. economy will continue to improve at a gradual and perhaps uneven fashion. The slow-growth environment could create a bifurcated stock market in which well-run companies with solid business models outperform. We also believe that while cyclical stocks and companies with cyclical earnings have generally performed positively as of late, this trend will eventually shift to the benefit of consistent, longer-term performers. If our expectations are correct, the current market environment could potentially favor our investment style and process, which focuses on companies with sustainable competitive advantages. We view such firms as well-positioned to generate stronger profit margins and take market share from weaker players. We seek to buy such companies when their valuations are attractive, and believe that this disciplined investment process is the key to generating solid long-term performance.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

4 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. Performance is measured over a ten-fiscal-year period for both Classes. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the Russell 2500 Index, a broad-based index featuring 2,500 stocks of companies with small- and mid-cap market capitalizations, and the Russell 2000 Index, an unmanaged index of equity securities of small capitalization companies that is a measure of the small company market. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

5 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FUND PERFORMANCE DISCUSSION

 Non-Service Shares
 Comparison of Change in Value of $10,000 Hypothetical Investments in:

 Service Shares
 Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	908.50	$	3.79
Service shares		1,000.00		907.70		4.99
Hypothetical
(5% return before expenses)
Non-Service shares		1,000.00		1,021.11		4.01
Service shares		1,000.00		1,019.85		5.28

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.79	%
Service shares		1.04

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—98.7%
Consumer Discretionary—16.4%
Auto Components—1.1%
Dana Holding Corp.1		712,970	$	8,662,586
Standard Motor Products, Inc.		21,980		440,699
				9,103,285
Distributors—0.8%
Pool Corp.		215,280		6,479,928
Diversified Consumer Services—0.5%
Bridgepoint Education, Inc.1		61,970		1,425,310
Capella Education Co.1		5,760		207,648
Coinstar, Inc.1		35,650		1,627,066
DeVry, Inc.		5,730		220,376
ITT Educational Services, Inc.1		1,321		75,152
Regis Corp.		46,380		767,589
Service Corp. International		13,780		146,757
				4,469,898
Hotels, Restaurants & Leisure—2.2%
AFC Enterprises, Inc.1		15,432		226,850
Ameristar Casinos, Inc.		76,357		1,320,213
Bob Evans Farms, Inc.		20,790		697,297
Brinker International, Inc.		85,980		2,300,825
Cheesecake Factory, Inc. (The)1		50,250		1,474,838
Cracker Barrel Old Country Store, Inc.		57,270		2,886,981
Dunkin’ Brands Group, Inc.1		280,160		6,998,397
Jack in the Box, Inc.1		5,780		120,802
Marriott Vacations Worldwide Corp.1		6,470		111,025
P.F. Chang’s China Bistro, Inc.		2,862		88,464
Papa John’s International, Inc.1		53,648		2,021,457
Shuffle Master, Inc.1		6,370		74,656
Texas Roadhouse, Inc., Cl. A		72,990		1,087,551
Wyndham Worldwide Corp.		930		35,182
				19,444,538
Household Durables—1.4%
American Greetings Corp., Cl. A		66,590		833,041
CSS Industries, Inc.		12,790		254,777
Helen of Troy Ltd.1		26,660		818,462
Jarden Corp.		31,960		954,965
Toll Brothers, Inc.1		470,540		9,608,427
Universal Electronics, Inc.1		500		8,435
				12,478,107
Internet & Catalog Retail—0.1%
Expedia, Inc.		9,215		267,419
HSN, Inc.		3,440		124,734
TripAdvisor, Inc.1		5,885		148,361
				540,514
Leisure Equipment & Products—0.0%
Polaris Industries, Inc.		1,531		85,705
Media—1.6%
Cinemark Holdings, Inc.		37,240		688,568
Dish Network Corp., Cl. A		30,260		861,805
Global Sources Ltd.1		17,700		85,845
IMAX Corp.1		448,540		8,221,738
Interpublic Group of Cos., Inc. (The)		174,040		1,693,409
Journal Communications, Inc.1		58,170		255,948
Sinclair Broadcast Group, Inc., Cl. A		162,333		1,839,233
Valassis Communications, Inc.1		18,900		363,447
				14,009,993
Multiline Retail—0.7%
Big Lots, Inc.1		53,480		2,019,405
Dillard’s, Inc., Cl. A		50,820		2,280,802
Fred’s, Inc.		24,420		356,044
Saks, Inc.1		160,760		1,567,410
				6,223,661
Specialty Retail—6.0%
Aaron’s, Inc.		18,160		484,509
Advance Auto Parts, Inc.		14,970		1,042,361
AnnTaylor Stores Corp.1		63,470		1,572,787
Ascena Retail Group, Inc.1		66,740		1,983,513
CarMax, Inc.1		206,340		6,289,243
Casual Male Retail Group, Inc.1		11,200		38,304
Cato Corp., Cl. A		82,214		1,989,579
Chico’s FAS, Inc.		150,280		1,674,119
Children’s Place Retail Stores, Inc.1		130,860		6,951,283
Dick’s Sporting Goods, Inc.		7,640		281,763
DSW, Inc., Cl. A		3,943		174,320
Express, Inc.1		108,710		2,167,677
Finish Line, Inc. (The), Cl. A		103,110		1,988,476
Foot Locker, Inc.		99,850		2,380,424
GameStop Corp., Cl. A1		90,090		2,173,872
GNC Holdings, Inc., Cl. A1		4,390		127,091
Group 1 Automotive, Inc.		12,540		649,572
hhgregg, Inc.1		2,890		41,761
Hibbett Sports, Inc.1		2,640		119,275
Men’s Wearhouse, Inc. (The)		57,460		1,862,279
Monro Muffler Brake, Inc.		173,320		6,723,083
Pep Boys-Manny, Moe & Jack		36,600		402,600
PetSmart, Inc.		2,520		129,251
Pier 1 Imports, Inc.1		107,950		1,503,744
RadioShack Corp.		7,115		69,087
Rent-A-Center, Inc.		15,290		565,730
Sally Beauty Holdings, Inc.1		80,520		1,701,388

8 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

	Shares		Value
Specialty Retail Continued
Select Comfort Corp.1		80,730	$	1,751,034
Tractor Supply Co.		49,522		3,473,968
Wet Seal, Inc., Cl. A1		357,070		1,164,048
Williams-Sonoma, Inc.		28,300		1,089,550
				52,565,691
Textiles, Apparel & Luxury Goods—2.0%
Fossil, Inc.1		89,647		7,114,386
Iconix Brand Group, Inc.1		4,950		80,636
PVH Corp.		148,100		10,439,569
				17,634,591
Consumer Staples—2.5%
Beverages—0.2%
Constellation Brands, Inc., Cl. A1		82,810		1,711,683
Cott Corp.1		6,340		39,688
Dr. Pepper Snapple Group, Inc.		1,080		42,638
				1,794,009
Food & Staples Retailing—0.4%
Casey’s General Stores, Inc.		33,090		1,704,466
Ruddick Corp.		21,220		904,821
Spartan Stores, Inc.		29,650		548,525
Susser Holdings Corp.1		7,330		165,805
Weis Markets, Inc.		7,410		295,955
				3,619,572
Food Products—1.0%
Darling International, Inc.1		47,260		628,085
Hormel Foods Corp.		1,330		38,956
Smithfield Foods, Inc.1		3,360		81,581
TreeHouse Foods, Inc.1		88,586		5,791,753
Tyson Foods, Inc., Cl. A		102,090		2,107,138
				8,647,513
Household Products—0.5%
Church & Dwight Co., Inc.		103,960		4,757,210
Personal Products—0.3%
Elizabeth Arden, Inc.1		4,980		184,459
Medifast, Inc.1		63,920		876,982
Prestige Brands Holdings, Inc.1		32,990		371,797
USANA Health Sciences, Inc.1		30,010		911,404
				2,344,642
Tobacco—0.1%
Universal Corp.		19,570		899,437
Energy—6.7%
Energy Equipment & Services—1.5%
Bolt Technology Corp.		24,350		278,564
Helix Energy Solutions Group, Inc.1		95,060		1,501,948
Helmerich & Payne, Inc.		5,620		327,983
ION Geophysical Corp.1		71,170		436,272
Matrix Service Co.1		32,970		311,237
Nabors Industries Ltd.1		14,930		258,886
Newpark Resources, Inc.1		264,660		2,514,270
Parker Drilling Co.1		164,760		1,181,329
Patterson-UTI Energy, Inc.		53,410		1,067,132
Pioneer Drilling Co.1		58,660		567,829
Precision Drilling Corp.1		145,640		1,494,266
RPC, Inc.		86,380		1,576,435
Superior Energy Services, Inc.1		52,590		1,495,660
Tesco Corp.1		42,120		532,397
				13,544,208
Oil, Gas & Consumable Fuels—5.2%
CVR Energy, Inc.1		97,704		1,829,996
Delek US Holdings, Inc.		15,360		175,258
Energy Partners Ltd.1		18,410		268,786
Energy XXI (Bermuda) Ltd.1		106,600		3,398,408
Gran Tierra Energy, Inc.1		8,470		40,656
HollyFrontier Corp.		591,960		13,851,864
Kosmos Energy Ltd.1		278,990		3,420,417
MarkWest Energy Partners LP		120,678		6,644,531
PAA Natural Gas Storage LP		246,700		4,625,625
Petrobras Argentina SA, ADR		38,200		482,084
Stone Energy Corp.1		61,710		1,627,910
Tesoro Corp.1		83,280		1,945,421
Ultrapar Participacoes SA, Sponsored ADR		75,630		1,300,836
VAALCO Energy, Inc.1		228,720		1,381,469
W&T Offshore, Inc.		87,780		1,861,814
Warren Resources, Inc.1		113,020		368,445
Western Refining, Inc.1		125,050		1,661,915
				44,885,435
Financials—20.7%
Capital Markets—1.0%
Apollo Global Management LLC		149,000		1,849,090
Federated Investors, Inc., Cl. B		104,960		1,590,144
Financial Engines, Inc.1		53,940		1,204,480
KBW, Inc.		243,010		3,688,892
Knight Capital Group, Inc., Cl. A1		27,950		330,369
				8,662,975

9 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares		Value
Commercial Banks—2.4%
BBVA Banco Frances SA, ADR		76,043	$	370,329
CapitalSource, Inc.		1,322,410		8,860,147
Cardinal Financial Corp.		1,580		16,969
Century Bancorp, Inc., Cl. A		11,660		329,278
Columbia Banking System, Inc.		4,500		86,715
First Horizon National Corp.		12,962		103,696
First Midwest Bancorp, Inc.		312,830		3,168,968
FirstMerit Corp.		363,590		5,501,117
Fulton Financial Corp.		101,530		996,009
Grupo Financiero Galicia SA, ADR		123,750		733,838
National Bankshares, Inc.		8,901		248,516
Republic Bancorp, Inc., Cl. A		11,030		252,587
State Bank Financial Corp.1		2,190		33,091
Washington Banking Co.		11,740		139,823
				20,841,083
Consumer Finance—0.4%
Advance America Cash Advance Centers, Inc.		112,870		1,010,187
EZCORP, Inc., Cl. A1		20,960		552,715
First Cash Financial Services, Inc.1		2,183		76,601
World Acceptance Corp.1		17,337		1,274,270
				2,913,773
Diversified Financial Services—2.2%
Encore Capital Group, Inc.1		31,420		667,989
Life Partners Holdings, Inc.		50,329		325,125
Moody’s Corp.		210,050		7,074,484
MSCI, Inc., Cl. A1		318,920		10,502,036
NASDAQ OMX Group, Inc. (The)1		11,610		284,561
				18,854,195
Insurance—4.9%
Alterra Capital Holdings Ltd.		118,210		2,793,302
American Equity Investment Life Holding Co.		140,620		1,462,448
American Financial Group, Inc.		63,980		2,360,222
American Safety Insurance Holdings Ltd.1		18,530		403,028
AmTrust Financial Services, Inc.		87,528		2,078,790
Arch Capital Group Ltd.1		91,030		3,389,047
Assured Guaranty Ltd.		11,600		152,424
Brown & Brown, Inc.		282,540		6,393,880
CNO Financial Group, Inc.1		205,110		1,294,244
FBL Financial Group, Inc., Cl. A		24,334		827,843
Fidelity National Financial, Inc., Cl. A		151,710		2,416,740
Global Indemnity plc1		5,062		100,379
HCC Insurance Holdings, Inc.		69,410		1,908,775
Horace Mann Educators Corp.		71,279		977,235
Maiden Holdings Ltd.		112,880		988,829
Meadowbrook Insurance Group, Inc.		125,190		1,337,029
National Financial Partners Corp.1		18,660		252,283
National Interstate Corp.		10,850		267,670
National Western Life Insurance Co., Cl. A		2,410		328,146
Primerica, Inc.		104,700		2,433,228
Principal Financial Group, Inc. (The)		23,440		576,624
ProAssurance Corp.		20		1,596
Protective Life Corp.		78,250		1,765,320
Reinsurance Group of America, Inc.		36,360		1,899,810
RLI Corp.		1,690		123,133
StanCorp Financial Group, Inc.		1,960		72,030
Symetra Financial Corp.		172,160		1,561,491
Torchmark Corp.		34,565		1,499,775
Tower Group, Inc.		69,800		1,407,866
Universal Insurance Holdings, Inc.		20,710		74,142
Unum Group		69,650		1,467,526
				42,614,855
Real Estate Investment Trusts—9.3%
American Campus Communities, Inc.		56,320		2,363,187
Associated Estates Realty Corp.		77,180		1,231,021
BioMed Realty Trust, Inc.		77,100		1,393,968
BRE Properties, Inc., Cl. A		48,980		2,472,510
Camden Property Trust		7,580		471,779
Chatham Lodging Trust		152,860		1,647,831
Colonial Properties Trust		4,610		96,165
CubeSmart		186,130		1,980,423
CYS Investments, Inc.		279,340		3,670,528
DDR Corp.		1,400		17,038
Digital Realty Trust, Inc.		157,910		10,527,860
Douglas Emmett, Inc.		38,360		699,686
EastGroup Properties, Inc.		39,130		1,701,372
Equity Lifestyle Properties, Inc.		32,090		2,140,082
Essex Property Trust, Inc.		15,770		2,215,843
Extra Space Storage, Inc.		102,160		2,475,337
Federal Realty Investment Trust		19,040		1,727,880
Glimcher Realty Trust		100,630		925,796
Hatteras Financial Corp.		227,210		5,991,528
Highwoods Properties, Inc.		960		28,483
Home Properties of New York, Inc.		39,970		2,301,073
Hospitality Properties Trust		71,330		1,639,163
Kilroy Realty Corp.		3,290		125,250
LaSalle Hotel Properties		345,758		8,370,801
LTC Properties, Inc.		24,350		751,441

10 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

	Shares		Value
Real Estate Investment Trusts Continued
Mid-America Apartment Communities, Inc.		101,919	$	6,375,033
National Retail Properties, Inc.		59,260		1,563,279
Post Properties, Inc.		38,090		1,665,295
PS Business Parks, Inc.		2,210		122,500
Realty Income Corp.		24,100		842,536
Sovran Self Storage, Inc.		29,630		1,264,312
Starwood Property Trust, Inc.		316,420		5,856,934
Sun Communities, Inc.		37,420		1,366,953
Tanger Factory Outlet Centers, Inc.		83,880		2,459,362
Taubman Centers, Inc.		36,160		2,245,536
Universal Health Realty Income Trust		7,490		292,110
Weingarten Realty Investors		790		17,238
				81,037,133
Real Estate Management & Development—0.0%
MI Developments, Inc.		9,000		287,820
Thrifts & Mortgage Finance—0.5%
BankUnited, Inc.		162,620		3,576,014
Dime Community Bancshares, Inc.		3,790		47,754
First Defiance Financial Corp.		29,910		436,387
Flushing Financial Corp.		3,390		42,816
OceanFirst Financial Corp.		11,940		156,056
Ocwen Financial Corp.1		40		579
Walker & Dunlop, Inc.1		14,400		180,864
				4,440,470
Health Care—10.2%
Biotechnology—1.4%
Aveo Pharmaceuticals, Inc.1		89,140		1,533,208
Halozyme Therapeutics, Inc.1		351,680		3,344,477
Indevus Pharmaceuticals, Inc.1		2,500		25
Inhibitex, Inc.1		140,240		1,534,226
Medivation, Inc.1		36,810		1,697,309
Myriad Genetics, Inc.1		88,364		1,850,342
PDL BioPharma, Inc.		387,212		2,400,714
United Therapeutics Corp.1		4,610		217,823
				12,578,124
Health Care Equipment & Supplies—1.6%
Bard (C.R.), Inc.		8,950		765,225
Cantel Medical Corp.		5,780		161,435
ConMed Corp.1		13,930		357,583
Dexcom, Inc.1		352,310		3,280,006
Greatbatch, Inc.1		205,800		4,548,180
ICU Medical, Inc.1		5,120		230,400
IDEXX Laboratories, Inc.1		1,226		94,353
Invacare Corp.		600		9,174
Orthofix International NV1		55,850		1,967,596
ResMed, Inc.1		56,630		1,438,402
RTI Biologics, Inc.1		5,280		23,443
Vascular Solutions, Inc.1		510		5,676
Wright Medical Group, Inc.1		25,620		422,730
Young Innovations, Inc.		10,110		299,559
				13,603,762
Health Care Providers & Services—4.0%
AmSurg Corp.1		56,440		1,469,698
Assisted Living Concepts, Inc.		4,190		62,389
Bio-Reference Laboratories, Inc.1		25,570		416,024
Brookdale Senior Living, Inc.1		12,304		213,967
Centene Corp.1		59,920		2,372,233
Chemed Corp.		24,670		1,263,351
DaVita, Inc.1		3,170		240,318
Ensign Group, Inc. (The)		49,660		1,216,670
ExamWorks Group, Inc.1		15,300		145,044
Health Management Associates, Inc., Cl. A1		186,650		1,375,611
HealthSouth Corp.1		320,030		5,654,930
Healthspring, Inc.1		41,380		2,256,865
HMS Holdings Corp.1		156,060		4,990,799
Laboratory Corp. of America Holdings1		1,960		168,501
LifePoint Hospitals, Inc.1		48,025		1,784,129
Lincare Holdings, Inc.		75,556		1,942,545
Magellan Health Services, Inc.1		1,653		81,774
MedQuist Holdings, Inc.1		61,490		591,534
Metropolitan Health Networks, Inc.1		122,670		916,345
Molina Healthcare, Inc.1		26,250		586,163
Patterson Cos., Inc.		48,080		1,419,322
PSS World Medical, Inc.1		74,930		1,812,557
Schein (Henry), Inc.1		1,860		119,840
Select Medical Holdings Corp.1		103,530		877,934
Triple-S Management Corp., Cl. B1		21,207		424,564
U.S. Physical Therapy, Inc.		36,375		715,860
Universal Health Services, Inc., Cl. B		44,400		1,725,384
				34,844,351
Health Care Technology—0.1%
Allscripts Healthcare Solutions, Inc.1		6,860		129,928
HealthStream, Inc.1		7,970		147,047
MedAssets, Inc.1		12,520		115,810
Transcend Services, Inc.1		17,290		410,292
				803,077

11 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares		Value
Life Sciences Tools & Services—0.9%
Cambrex Corp.1		99,400	$	713,692
eResearch Technology, Inc.1		17,250		80,903
Harvard Bioscience, Inc.1		63,310		245,010
PerkinElmer, Inc.		4,730		94,600
Waters Corp.1		85,890		6,360,155
				7,494,360
Pharmaceuticals—2.2%
Hi-Tech Pharmacal Co., Inc.1		43,390		1,687,437
Medicines Co. (The)1		132,730		2,474,087
Obagi Medical Products, Inc.1		25,380		257,861
Questcor Pharmaceuticals, Inc.1		324,300		13,484,394
Warner Chilcott plc, Cl. A1		113,000		1,709,690
				19,613,469
Industrials—16.1%
Aerospace & Defense—1.6%
B/E Aerospace, Inc.1		200,688		7,768,632
Ceradyne, Inc.1		9,851		263,810
Cubic Corp.		12,410		540,952
Curtiss-Wright Corp.		47,620		1,682,415
Exelis, Inc.		134,440		1,216,682
LMI Aerospace, Inc.1		14,280		250,614
Moog, Inc., Cl. A1		12,920		567,576
Orbital Sciences Corp.1		90,870		1,320,341
				13,611,022
Air Freight & Logistics—0.6%
Hub Group, Inc., Cl. A1		146,140		4,739,320
Park-Ohio Holdings Corp.1		6,560		117,030
				4,856,350
Airlines—0.3%
Alaska Air Group, Inc.1		30,770		2,310,519
Spirit Airlines, Inc.1		1,860		29,016
				2,339,535
Commercial Services & Supplies—2.1%
Acco Brands Corp.1		3,620		34,933
Brink’s Co. (The)		14,370		386,266
Cintas Corp.		22,519		783,886
Consolidated Graphics, Inc.1		21,810		1,052,987
Corrections Corp. of America1		72,530		1,477,436
Deluxe Corp.		95,566		2,175,082
Intersections, Inc.		19,400		215,146
KAR Auction Services, Inc.1		87,540		1,181,790
Knoll, Inc.		115,020		1,708,047
Miller (Herman), Inc.		82,000		1,512,900
Multi-Color Corp.		8,120		208,928
Quad Graphics, Inc.		8,949		128,329
R.R. Donnelley & Sons Co.		31,530		454,978
Steelcase, Inc., Cl. A		140,910		1,051,189
Sykes Enterprises, Inc.1		87,490		1,370,093
Tetra Tech, Inc.1		79,750		1,721,803
United Stationers, Inc.		5,470		178,103
Waste Connections, Inc.		91,645		3,037,115
				18,679,011
Construction & Engineering—2.1%
Aecom Technology Corp.1		221,069		4,547,389
Chicago Bridge & Iron Co. NV		25,150		950,670
EMCOR Group, Inc.		12,622		338,396
KBR, Inc.		354,810		9,888,555
Primoris Services Corp.		66,440		991,949
URS Corp.1		51,770		1,818,162
				18,535,121
Electrical Equipment—1.7%
Belden, Inc.		36,400		1,211,392
Brady Corp., Cl. A		17,070		538,900
EnerSys, Inc.1		8,181		212,461
Generac Holdings, Inc.1		119,310		3,344,259
General Cable Corp.1		168,420		4,212,184
Regal-Beloit Corp.		101,970		5,197,411
				14,716,607
Industrial Conglomerates—0.0%
Standex International Corp.		10,490		358,443
Machinery—2.1%
Actuant Corp., Cl. A		68,950		1,564,476
AGCO Corp.1		36,900		1,585,593
Albany International Corp., Cl. A		35,660		824,459
Barnes Group, Inc.		27,500		663,025
Blount International, Inc.1		64,040		929,861
Briggs & Stratton Corp.		24,990		387,095
Douglas Dynamics, Inc.		21,400		312,868
Duoyuan Global Water, Inc., ADR1		19,520		18,934
Freightcar America, Inc.1		96,380		2,019,161
Gardner Denver, Inc.		1,236		95,246
John Bean Technologies Corp.		9,500		146,015
Kadant, Inc.1		31,010		701,136
Kennametal, Inc.		40,010		1,461,165
Lincoln Electric Holdings, Inc.		3,390		132,617
Miller Industries, Inc.		17,650		277,635
Navistar International Corp.1		20,108		761,691

12 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

	Shares		Value
Machinery Continued
Sauer-Danfoss, Inc.1		29,300	$	1,060,953
TriMas Corp.1		51,170		918,502
Wabtec Corp.		61,490		4,301,226
Xylem, Inc.		5,300		136,157
				18,297,815
Professional Services—3.0%
CBIZ, Inc.1		149,860		915,645
Dun & Bradstreet Corp.		1,356		101,469
GP Strategies Corp.1		34,700		467,756
ICF International, Inc.1		32,650		809,067
Insperity, Inc.		13,770		349,070
Kelly Services, Inc., Cl. A		34,090		466,351
Kforce, Inc.1		1,670		20,591
Korn-Ferry International1		368,460		6,285,928
Navigant Consulting, Inc.1		3,780		43,130
On Assignment, Inc.1		21,900		244,842
Robert Half International, Inc.		528,520		15,041,679
Towers Watson & Co., Cl. A		14,290		856,400
TrueBlue, Inc.1		38,390		532,853
				26,134,781
Road & Rail—2.2%
Genesee & Wyoming, Inc., Cl. A1		73,231		4,436,334
Knight Transportation, Inc.		75,320		1,178,005
Old Dominion Freight Line, Inc.1		311,400		12,621,042
RailAmerica, Inc.1		8,300		123,587
Werner Enterprises, Inc.		20,250		488,025
				18,846,993
Trading Companies & Distributors—0.4%
Applied Industrial Technologies, Inc.		69,950		2,460,142
Beacon Roofing Supply, Inc.1		24,930		504,334
Interline Brands, Inc.1		64,640		1,006,445
				3,970,921
Transportation Infrastructure—0.0%
Wesco Aircraft Holdings, Inc.1		7,890		110,381
Information Technology—15.6%
Communications Equipment—1.8%
Aruba Networks, Inc.1		386,760		7,162,795
Brocade Communications Systems, Inc.1		97,020		503,534
Finisar Corp.1		364,090		6,096,687
Ituran Location & Control Ltd.		21,751		297,336
Plantronics, Inc.		42,344		1,509,140
Riverbed Technology, Inc.1		7,574		177,989
				15,747,481
Computers & Peripherals—1.6%
Cray, Inc.1		29,830		193,000
Electronics for Imaging, Inc.1		85,710		1,221,368
Lexmark International, Inc., Cl. A		3,660		121,036
QLogic Corp.1		134,120		2,011,800
STEC, Inc.1		19,087		163,957
Synaptics, Inc.1		75,680		2,281,752
Western Digital Corp.1		260,700		8,068,665
				14,061,578
Electronic Equipment & Instruments—1.3%
Avnet, Inc.1		6,772		210,541
AVX Corp.		103,950		1,326,402
Brightpoint, Inc.1		86,070		926,113
Daktronics, Inc.		27,150		259,826
DDi Corp.		48,710		454,464
Electro Scientific Industries, Inc.1		19,830		287,138
Elster Group SE, ADR1		21,950		285,350
Flextronics International Ltd.1		61,540		348,316
Itron, Inc.1		2,423		86,671
Jabil Circuit, Inc.		80,360		1,579,878
Littlefuse, Inc.		14,440		620,631
Molex, Inc.		66,410		1,584,543
Newport Corp.1		56,170		764,474
Tech Data Corp.1		4,000		197,640
TTM Technologies, Inc.1		39,360		431,386
Vishay Intertechnology, Inc.1		142,830		1,284,042
X-Rite, Inc.1		28,350		131,544
Zygo Corp.1		3,680		64,952
				10,843,911
Internet Software & Services—0.9%
Ancestry.com, Inc.1		3,933		90,302
AOL, Inc.1		12,915		195,017
Demand Media, Inc.1		24,711		164,328
Digital River, Inc.1		8,983		134,925
j2 Global, Inc.		132,664		3,733,165
Monster Worldwide, Inc.1		9,880		78,348
OpenTable, Inc.1		2,970		116,216
QuinStreet, Inc.1		24,490		229,226
United Online, Inc.		105,770		575,389
ValueClick, Inc.1		124,250		2,024,033
WebMD Health Corp., Cl. A1		5,725		214,974
				7,555,923
IT Services—2.4%
Acxiom Corp.1		115,750		1,413,308
Alliance Data Systems Corp.1		921		95,637

13 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares		Value
IT Services Continued
Amdocs Ltd.1		41,520	$	1,184,566
Booz Allen Hamilton Holding Corp.1		29,520		509,220
Broadridge Financial Solutions, Inc.		37,760		851,488
CACI International, Inc., Cl. A1		92,636		5,180,205
CGI Group, Inc., Cl. A1		80,230		1,512,336
Convergys Corp.1		61,224		781,830
CSG Systems International, Inc.1		63,526		934,467
Euronet Worldwide, Inc.1		41,234		762,004
FleetCor Technologies, Inc.1		6,584		196,664
Genpact Ltd.1		42,560		636,272
Global Payments, Inc.		4,205		199,233
Henry (Jack) & Associates, Inc.		6,260		210,399
ManTech International Corp.		49,820		1,556,377
Maximus, Inc.		5,640		233,214
NeuStar, Inc., Cl. A1		60,430		2,064,893
SAIC, Inc.1		136,080		1,672,423
ServiceSource International, Inc.1		8,170		128,187
Total System Services, Inc.		19,020		372,031
VeriFone Systems, Inc.1		3,340		118,637
				20,613,391
Semiconductors & Semiconductor Equipment—4.4%
ASM International NV		19,120		557,922
Atmel Corp.1		46,660		377,946
ATMI, Inc.1		36,730		735,702
Brooks Automation, Inc.		168,149		1,726,890
Cabot Microelectronics Corp.1		2,570		121,433
Cavuim, Inc.1		188,170		5,349,673
Cypress Semiconductor Corp.		86,571		1,462,184
Entegris, Inc.1		144,220		1,258,320
Entropic Communications, Inc.1		140,480		717,853
Fairchild Semiconductor International, Inc., Cl. A1		25,220		303,649
GT Advanced Technologies, Inc.1		211,290		1,529,740
IXYS Corp.1		32,160		348,293
KLA-Tencor Corp.		1,850		89,263
Kulicke & Soffa Industries, Inc.1		120,140		1,111,295
Lattice Semiconductor Corp.1		313,260		1,860,764
LSI Corp.1		252,150		1,500,293
Magnachip Semiconductor Corp., Depositary Shares1		6,750		50,490
Micrel, Inc.		51,819		523,890
Nanometrics, Inc.1		94,328		1,737,522
OmniVision Technologies, Inc.1		19,080		233,444
Photronics, Inc.1		98,220		597,178
Rudolph Technologies, Inc.1		34,840		322,618
Semtech Corp.1		370,219		9,188,836
Skyworks Solutions, Inc.1		429,910		6,973,140
				38,678,338
Software—3.2%
BMC Software, Inc.1		7,210		236,344
Cadence Design Systems, Inc.1		169,150		1,759,160
Ebix, Inc.		7,550		166,855
FactSet Research Systems, Inc.		40,652		3,548,107
Fair Isaac Corp.		3,610		129,382
Fortinet, Inc.1		191,100		4,167,891
Informatica Corp.1		2,101		77,590
JDA Software Group, Inc.1		44,700		1,447,833
Manhattan Associates, Inc.1		2,295		92,902
Monotype Imaging Holdings, Inc.1		28,920		450,863
NetScout Systems, Inc.1		14,190		249,744
Progress Software Corp.1		90		1,742
Solarwinds, Inc.1		135,740		3,793,933
Synopsys, Inc.1		54,990		1,495,728
TIBCO Software, Inc.1		358,306		8,567,096
Websense, Inc.1		87,920		1,646,742
				27,831,912
Materials—5.6%
Chemicals—2.1%
American Vanguard Corp.		25,730		343,238
Chemtura Corp.1		7,994		90,652
Cytec Industries, Inc.		148,906		6,648,653
Ferro Corp.1		218,270		1,067,340
Fuller (H.B.) Co.		70,890		1,638,268
Huntsman Corp.		15,653		156,530
Innospec, Inc.1		3,940		110,596
Koppers Holdings, Inc.		22,280		765,541
Kronos Worldwide, Inc.		42,830		772,653
LSB Industries, Inc.1		26,630		746,439
Methanex Corp.		12,160		277,491
Olin Corp.		82,690		1,624,859
PolyOne Corp.		99,370		1,147,724
Schulman (A.), Inc.		21,670		458,971
Tredegar Corp.		32,564		723,572
Valspar Corp. (The)		18,800		732,636
Westlake Chemical Corp.		19,450		782,668
				18,087,831

14 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

	Shares			Value
Containers & Packaging—1.5%
Boise, Inc.		204,367		$	1,455,093
Graphic Packaging Holding Co.1		244,550			1,041,783
Myers Industries, Inc.		22,500			277,650
Packaging Corp. of America		329,380			8,313,551
Sealed Air Corp.		93,140			1,602,939
Silgan Holdings, Inc.		8,506			328,672
					13,019,688
Metals & Mining—1.4%
Century Aluminum Co.1		412,040			3,506,460
Compass Minerals International, Inc.		66,310			4,565,444
Nevsun Resources Ltd.		13,970			77,254
Noranda Aluminum Holding Corp.		23,220			191,565
Pan American Silver Corp.		46,370			1,011,330
Steel Dynamics, Inc.		125,990			1,656,769
Worthington Industries, Inc.		105,490			1,727,926
					12,736,748
Paper & Forest Products—0.6%
Buckeye Technologies, Inc.		85,850			2,870,824
Glatfelter		116,700			1,647,804
KapStone Paper & Packing Corp.1		17,050			268,367
Mercer International, Inc.1		34,350			209,535
					4,996,530
Telecommunication Services—0.9%
Diversified Telecommunication Services—0.6%
AboveNet, Inc.1		1,830			118,968
Brasil Telecom SA, ADR		35,060			623,717
Cincinnati Bell, Inc.1		78,602			238,164
Nortel Inversora SA, Sponsored ADR1		17,370			402,637
Telecom Argentina SA, Sponsored ADR		83,160			1,486,901
Telecom Corp. of New Zealand Ltd., Sponsored ADR		146,020			1,166,700
Vonage Holdings Corp.1		498,240			1,220,688
					5,257,775
Wireless Telecommunication Services—0.3%
Cellcom Israel Ltd.		41,590			702,871
Partner Communications Co. Ltd., Sponsored ADR		17,760			156,998
Telephone & Data Systems, Inc.		2,990			77,411
USA Mobility, Inc.		99,322			1,377,596
					2,314,876
Utilities—4.0%
Electric Utilities—0.8%
Cleco Corp.		2,090			79,629
Companhia Energetica de Minas Gerais, Sponsored ADR		96,060			1,708,907
Companhia Paranaense de Energia-Copel, Sponsored ADR		87,091			1,827,169
El Paso Electric Co.		7,880			272,963
Empire District Electric Co.		40			844
NV Energy, Inc.		62,310			1,018,769
Portland General Electric Co.		87,270			2,207,058
UniSource Energy Corp.		1,910			70,517
					7,185,856
Energy Traders—1.4%
AES Corp. (The)1		1,038,060			12,290,630
Gas Utilities—0.1%
Atmos Energy Corp.		26,400			880,440
Laclede Group, Inc. (The)		220			8,903
					889,343
Multi-Utilities—1.2%
Avista Corp.		33,140			853,355
CenterPoint Energy, Inc.		69,840			1,403,086
CMS Energy Corp.		105,780			2,335,603
NorthWestern Corp.		47,760			1,709,330
Teco Energy, Inc.		128,100			2,451,834
Vectren Corp.		38,680			1,169,296
					9,922,504
Water Utilities—0.5%
Aqua America, Inc.		189,060			4,168,773
Total Common Stocks (Cost $771,498,099)					858,777,452
Investment Companies—2.0%
BlackRock Kelso Capital Corp.		3,200			26,112
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%2,3		17,286,356			17,286,356
Prospect Capital Corp.		21,344			198,286
Total Investment Companies (Cost $17,504,820)					17,510,754
Total Investments, at Value (Cost $789,002,919)		100.7	%		876,288,206
Liabilities in Excess of Other Assets		(0.7	)		(5,814,120	)
Net Assets		100.0	%	$	870,474,086

15 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Non-income producing security.
2.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		13,940,550		259,986,336		256,640,530		17,286,356

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	17,286,356	$	27,488

3. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1) Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)

2) Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)

3) Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3-
	Level 1-		Level 2-		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	143,035,911	$	—	$	—	$	143,035,911
Consumer Staples		22,062,383		—		—		22,062,383
Energy		58,429,643		—		—		58,429,643
Financials		179,652,304		—		—		179,652,304
Health Care		88,937,118		—		25		88,937,143
Industrials		140,438,046		—		18,934		140,456,980
Information Technology		135,332,534		—		—		135,332,534
Materials		48,840,797		—		—		48,840,797
Telecommunication Services		7,572,651		—		—		7,572,651
Utilities		34,457,106		—		—		34,457,106
Investment Companies		17,510,754		—		—		17,510,754
Total Assets	$	876,269,247	$	—	$	18,959	$	876,288,206

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

16 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $771,716,563)	$	859,001,850
Affiliated companies (cost $17,286,356)		17,286,356
		876,288,206
Cash		128,190
Receivables and other assets:
Investments sold		8,857,653
Dividends		1,051,426
Other		20,217
Total assets		886,345,692
Liabilities
Payables and other liabilities:
Investments purchased		11,463,544
Shares of beneficial interest redeemed		3,860,364
Shareholder communications		255,470
Distribution and service plan fees		164,443
Transfer and shareholder servicing agent fees		73,970
Trustees’ compensation		17,259
Other		36,556
Total liabilities		15,871,606
Net Assets	$	870,474,086
Composition of Net Assets
Par value of shares of beneficial interest	$	51,115
Additional paid-in capital		864,347,106
Accumulated net investment income		3,886,759
Accumulated net realized loss on investments and foreign currency transactions		(85,096,181	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		87,285,287
Net Assets	$	870,474,086
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $79,721,990 and 4,642,305 shares of beneficial interest outstanding)	$	17.17
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $790,752,096 and 46,472,920 shares of beneficial interest outstanding)	$	17.02

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

17 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $65,983)	$	12,575,002
Affiliated companies		27,488
Interest		569
Total investment income		12,603,059
Expenses
Management fees		6,299,582
Distribution and service plan fees — Service shares		2,058,442
Transfer and shareholder servicing agent fees:
Non-Service shares		86,822
Service shares		823,389
Shareholder communications:
Non-Service shares		22,908
Service shares		216,334
Trustees’ compensation		36,886
Custodian fees and expenses		5,171
Administration service fees		1,500
Other		104,687
Total expenses		9,655,721
Less waivers and reimbursements of expenses		(343,594	)
Net expenses		9,312,127
Net Investment Income		3,290,932
Realized and Unrealized Gain (Loss)
Net realized gain on investments from:
Unaffiliated companies		130,487,197
Foreign currency transactions		34,071
Net realized gain		130,521,268
Net change in unrealized appreciation/depreciation on:
Investments		(149,915,063	)
Translation of assets and liabilities denominated in foreign currencies		(23,810	)
Net change in unrealized appreciation/depreciation		(149,938,873	)
Net Decrease in Net Assets Resulting from Operations	$	(16,126,673	)

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

18 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	3,290,932		$	3,898,427
Net realized gain		130,521,268			52,686,058
Net change in unrealized appreciation/depreciation		(149,938,873	)		128,474,710
Net increase (decrease) in net assets resulting from operations		(16,126,673	)		185,059,195
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(569,104	)		(548,102	)
Service shares		(3,235,789	)		(2,854,368	)
		(3,804,893	)		(3,402,470	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		(13,898,613	)		(4,150,760	)
Service shares		(50,982,214	)		33,619,248
		(64,880,827	)		29,468,488
Net Assets
Total increase (decrease)		(84,812,393	)		211,125,213
Beginning of period		955,286,479			744,161,266
End of period (including accumulated net investment income of $3,886,759 and $4,175,047, respectively)	$	870,474,086		$	955,286,479

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

19 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	17.66		$	14.40		$	10.65		$	18.20		$	19.15
Income (loss) from investment operations:
Net investment income2		.10			.10			.08			.12			.09
Net realized and unrealized gain (loss)		(.48	)		3.25			3.78			(6.73	)		(.30	)
Total from investment operations		(.38	)		3.35			3.86			(6.61	)		(.21	)
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.11	)		(.09	)		(.11	)		(.08	)		(.06	)
Distributions from net realized gain		—			—			—			(.86	)		(.68	)
Total dividends and/or distributions to shareholders		(.11	)		(.09	)		(.11	)		(.94	)		(.74	)
Net asset value, end of period	$	17.17		$	17.66		$	14.40		$	10.65		$	18.20
Total Return, at Net Asset Value3		(2.21	)%		23.41	%		37.20	%		(37.83	)%		(1.21	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	79,722		$	95,576		$	81,814		$	58,478		$	93,939
Average net assets (in thousands)	$	86,796		$	88,063		$	69,585		$	80,406		$	94,815
Ratios to average net assets:4
Net investment income		0.58	%		0.68	%		0.71	%		0.80	%		0.48	%
Total expenses5		0.83	%		0.85	%		0.91	%		0.75	%		0.73	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.80	%		0.80	%		0.82	%		0.75	%		0.73	%
Portfolio turnover rate		108	%		73	%		140	%		130	%		115	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total Expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	0.83	%
Year Ended December 31, 2010	0.85	%
Year Ended December 31, 2009	0.91	%
Year Ended December 31, 2008	0.75	%
Year Ended December 31, 2007	0.73	%

See accompanying Notes to Financial Statements.

20 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

	Year Ended
	December 30,									Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	17.50		$	14.28		$	10.54		$	18.03		$	18.98
Income (loss) from investment operations:
Net investment income2		.06			.07			.05			.08			.05
Net realized and unrealized gain (loss)		(.47	)		3.21			3.76			(6.67	)		(.29	)
Total from investment operations		(.41	)		3.28			3.81			(6.59	)		(.24	)
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.07	)		(.06	)		(.07	)		(.04	)		(.03	)
Distributions from net realized gain		—			—			—			(.86	)		(.68	)
Total dividends and/or distributions to shareholders		(.07	)		(.06	)		(.07	)		(.90	)		(.71	)
Net asset value, end of period	$	17.02		$	17.50		$	14.28		$	10.54		$	18.03
Total Return, at Net Asset Value3		(2.38	)%		23.06	%		36.88	%		(38.00	)%		(1.39	)%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	790,752		$	859,710		$	662,347		$	551,644		$	821,642
Average net assets (in thousands)	$	823,201		$	730,069		$	612,651		$	769,150		$	766,102
Ratios to average net assets:4
Net investment income		0.34	%		0.45	%		0.47	%		0.52	%		0.23	%
Total expenses5		1.08	%		1.10	%		1.15	%		0.99	%		0.97	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.05	%		1.05	%		1.07	%		0.99	%		0.97	%
Portfolio turnover rate		108	%		73	%		140	%		130	%		115	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.08	%
Year Ended December 31, 2010	1.10	%
Year Ended December 31, 2009	1.15	%
Year Ended December 31, 2008	0.99	%
Year Ended December 31, 2007	0.97	%

See accompanying Notes to Financial Statements.

21 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Main Street Small- & Mid-Cap Fund/VA (the “Fund”), formerly Oppenheimer Main Street Small Cap Fund/VA, is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek capital appreciation. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

22 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

23 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Appreciation
					Based on Cost
					of Securities and
Undistributed	Undistributed		Accumulated		Other Investments
Net Investment	Long-Term		Loss		for Federal Income
Income	Gain		Carryforward1,2,3		Tax Purposes
$2,648,726	$	—	$	80,902,957	$	84,353,340

1. As of December 30, 2011, the Fund had $80,902,957 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2017	$	80,902,957

2.	During the fiscal year ended December 30, 2011, the Fund utilized $126,312,039 of capital loss carryforward to offset capital gains realized in that fiscal year.
3.	During the fiscal year ended December 31, 2010, the Fund utilized $46,424,238 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Increase to		Increase to
	Accumulated		Accumulated Net
Reduction to	Net Investment		Realized Loss
Paid-in Capital	Income		on Investments
$5	$	225,673	$	225,668

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	3,804,893	$	3,402,470

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following

24 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	791,934,866
Gross unrealized appreciation	$	123,193,164
Gross unrealized depreciation		(38,839,824	)
Net unrealized appreciation	$	84,353,340

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

25 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		1,642,399		$	27,944,106			2,793,780		$	42,429,352
Dividends and/or distributions reinvested		30,896			569,104			36,202			548,102
Redeemed		(2,443,618	)		(42,411,823	)		(3,098,803	)		(47,128,214	)
Net decrease		(770,323	)	$	(13,898,613	)		(268,821	)	$	(4,150,760	)
Service Shares
Sold		6,217,855		$	105,066,282			11,844,155		$	173,858,907
Dividends and/or distributions reinvested		176,916			3,235,789			189,911			2,854,368
Redeemed		(9,038,872	)		(159,284,285	)		(9,301,032	)		(143,094,027	)
Net increase (decrease)		(2,644,101	)	$	(50,982,214	)		2,733,034		$	33,619,248

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	974,052,024	$	1,035,161,207

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $916,777 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

26 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $30,571 and $297,339 for Non-Service and Service shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $15,684 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

27 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for as Hedging Instruments	Foreign currency transactions
Foreign exchange contracts	$	564

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions,

28 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $464 and $649, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

     As of December 30, 2011, the Fund had no outstanding forward contracts.

6. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the

29 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

6. Pending Litigation Continued

Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

30 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Main Street Small- & Mid-Cap Fund/VA, formerly Oppenheimer Main Street Small Cap Fund/VA, (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Main Street Small- & Mid-Cap Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Main Street Small- & Mid-Cap Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

31 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 100% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

32 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Matthew Ziehl, Raymond Anello, and Raman Vardharaj, the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other small-cap core funds underlying

33 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued

variable insurance products. The Board considered that the Fund outperformed its performance universe median during the ten-year Lipper period, although it underperformed its performance universe median during the one-, three-and five-year Lipper periods. The Board also considered the change, effective May 19, 2009, of a new portfolio management team and the change, effective November 1, 2010, to the investment strategy and name of the Fund. The Board also noted the Fund’s recent performance, which ranked in the third quintile of the Fund’s performance universe during the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other small-cap core funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were lower than its expense group median. The Board also considered that the Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. This voluntary expense limitation may not be amended or withdrawn until one year after the date of prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

34 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

35 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in
Fund, Length of Service, Age	the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000 — June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1998) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1998) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds

36 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

Name, Position(s) Held with the	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in
Fund, Length of Service, Age	the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999 — March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005- March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003- March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004- August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005-December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007- December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

37 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Position(s) Held with the	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in
Fund, Length of Service, Age	the Fund Complex Currently Overseen
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Ziehl, Vardharaj, Anello, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite or until his or her resignation, retirement, death or removal.
Matthew P. Ziehl, Vice President (since 2009) Age: 44	Vice President of the Manager (since May 2009); a Chartered Financial Analyst. Prior to joining the Manager, a portfolio manager with RS Investment Management Co. LLC (October 2006-May 2009); a managing director at The Guardian Life Insurance Company of America (December 2001-October 2006) when Guardian Life Insurance acquired an interest in RS Investment Management Co. LLC; a team leader and co-portfolio manager with Salomon Brothers Asset Management, Inc. for small growth portfolios (January 2001-December 2001). A portfolio manager and officer of 2 portfolios in the OppenheimerFunds complex.
Raman Vardharaj, Vice President (since 2009) Age: 40	Vice President of the Manager (since May 2009); a Chartered Financial Analyst. Prior to joining the Manager, a sector manager and a senior quantitative analyst creating stock selection models, monitoring portfolio risks and analyzing portfolio performance across the RS Core Equity Team of RS Investment Management Co. LLC (October 2006-May 2009); a quantitative analyst at The Guardian Life Insurance Company of America (1998-October 2006) when Guardian Life Insurance acquired an interest in RS Investment Management Co. LLC. A portfolio manager and officer of 2 portfolios in the OppenheimerFunds complex.
Raymond Anello, Vice President (since 2011) Age: 47	Vice President of the Manager and sector manager for energy and utilities for the Manager’s Main Street Investment Team (since May 2009); a Chartered Financial Analyst. Prior to joining the Manager, a portfolio manager of the RS All Cap Dividend product (July 2007-April 2009) and a sector manager for energy and utilities for various other RS Investments products; joined Guardian Life Insurance Company in October 1999 and transitioned to RS Investments in October 2006 in connection with Guardian Life Insurance Company’s acquisition of an interest in RS Investments. A portfolio manager and officer of 2 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since March 1997); Director of Investment Brand Management of the Manager (since November 1997); Senior Vice President of OppenheimerFunds Distributor, Inc. (since December 1997). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and

38 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

Name, Position(s) Held with the	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in
Fund, Length of Service, Age	the Fund Complex Currently Overseen
Brian W. Wixted, Continued	OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

39 | OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND/VA

OPPENHEIMER MAIN STREET SMALL- & MID-CAP FUND^®/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered	KPMG llp
Public Accounting Firm Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011

OPPENHEIMER MONEY FUND/VA

Current Yield
For the 7-Day Period Ended 12/30/111
With Compounding	0.01	%
Without Compounding	0.01
For the 12-Month Period Ended 12/30/111
With Compounding	0.01	%
Without Compounding	0.01

Portfolio Managers: Carol Wolf and Christopher Proctor, CFA

The performance data quoted represents past performance, which does not guarantee future results. Yields include dividends in a hypothetical investment for the periods shown. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The yields take into account voluntary fee waivers and/or expense reimbursements, without which yields would have been lower. Some of these undertakings may be modified at any time, as indicated in the Fund’s prospectus. There is no guarantee that the Fund will maintain a positive yield. The Fund’s performance should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s performance does not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

Portfolio Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of investments.

Investment Strategy Discussion

The Fund continued to achieve its goals of providing capital preservation and liquidity to its shareholders. However, due to persistently low short-term interest rates set by the Federal Reserve (the “Fed”), the Fund’s yield remained near historically low levels.

Economic and Market Environment

The reporting period proved eventful from a macroeconomic perspective. Investor sentiment began to deteriorate in the spring of 2011 when Greece teetered on the brink of defaulting on its sovereign debt and fiscal pressures mounted on other members of the European Union. As their borrowing costs soared, a number of European nations implemented stringent austerity programs that weighed on the region’s economic growth rate. Meanwhile, inflationary pressures mounted in China and India, and investors worried that remedial measures, including higher local interest rates and tighter lending standards, might derail these major engines of global growth. In the United States, investors reacted cautiously to persistently high levels of unemployment, troubled housing markets and a contentious political debate regarding government spending, borrowing and taxes. These issues came to a head in early August, when Congress

1. December 30, 2011 was the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes to Financial Statements.

2 | OPPENHEIMER MONEY FUND/VA

passed last-minute legislation to raise the nation’s debt ceiling and, in an unprecedented move, the major credit rating agency Standard & Poor’s downgraded its assessment of long-term U.S. government debt. Short-term U.S. government debt, including instruments eligible for money market funds, retained their top-tier credit ratings.

     As a result of these developments, stock and bond markets encountered heightened volatility as investors engaged in a “flight to quality” away from riskier assets and toward traditional safe havens, such as U.S. Treasury securities. Volatility was particularly severe in August and September, as investors feared a return to recession in the United States and European policymakers disagreed on remedial measures for the region’s debt crisis. Fortunately, apparent progress toward a solution in Europe, better economic data in the United States and the increased likelihood of a “soft landing” for China helped to reverse this trend, and most financial markets rallied from October through December.

     In this environment, and as it has since December 2008, the Fed left short-term interest rates unchanged in a historically low range between 0% and 0.25%. Consequently, money market yields remained anchored near historically low levels. Although demand for money market instruments has remained robust from investors seeking safety and liquidity in light of turbulence in longer-term financial markets, the supply of newly issued instruments declined substantially during the reporting period. The reduction in supply is primarily attributable to the financial pressures on European banks, many of which curtailed their issuance programs as they focused on shoring up capital and weathering the debt crisis.

Portfolio Strategy

We maintained a conservative investment posture throughout 2011, carefully monitoring the health of the financial institutions that issue or back money market instruments. In light of the growing financial stress of European banks, we increased the Fund’s holdings of instruments from banks in the United States, Canada, Japan and Australia. We generally emphasized high-quality commercial paper and time deposits from high-quality issuers, and we continued to avoid non-traditional collateral in repurchase agreements. When opportunities for higher yields presented themselves, we increased the Fund’s holdings of floating-rate instruments tied to the London Interbank Offered Rate (LIBOR).

     In addition, for much of the year, we maintained the Fund’s weighted average maturity in a range that was modestly longer than industry averages in order to capture incrementally higher yields. However, the Fund ended the reporting period with a weighted average maturity in the neutral range, primarily due to the addition of floating-rate instruments.

     As of year-end, we have been encouraged by recent reports of U.S. economic improvement, including a drop in the unemployment rate from 9.0% to 8.5% between October and December. Nonetheless, a number of headwinds remain, including the still-unresolved European debt crisis, and U.S. economic growth seems likely to remain sluggish for some time. Consequently, we intend to retain the Fund’s focus on liquidity and capital preservation. We also expect to remain watchful for opportunities to boost yields through our credit selection strategy, including tactical investments in floating-rate instruments, as well as through changes to the Fund’s weighted average maturity.

An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

3 | OPPENHEIMER MONEY FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur ongoing costs, including management fees; service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio, and an assumed rate of return of 5% per year before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
Actual	July 1, 2011		December 30, 2011		December 30, 2011
	$	1,000.00	$	1,000.10	$	1.35
Hypothetical (5% return before expenses)
		1,000.00		1,023.71		1.37

Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). The annualized expense ratio based on the 6-month period ended December 30, 2011 is as follows:

Expense Ratio
	0.27	%

The expense ratio reflects reduction to voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” table in the Fund’s financial statements, included in this report, also shows the gross expense ratio, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

4 | OPPENHEIMER MONEY FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Maturity		Final Legal		Principal
	Date**		Maturity Date***		Amount		Value
Certificates of Deposit — 25.0%
Yankee Certificates of Deposit — 25.0%
Bank of Nova Scotia, Houston TX:
0.30%		2/7/12		2/7/12	$	1,600,000	$	1,600,000
0.52%		5/24/12		5/24/12		3,000,000		3,000,000
0.52%		5/25/12		5/25/12		3,600,000		3,600,000
National Australia Bank, New York:
0.29%		2/21/12		2/21/12		3,300,000		3,300,000
0.29%		2/21/12		2/21/12		1,800,000		1,800,000
0.31%		1/9/12		1/9/12		3,100,000		3,100,000
Nordea Bank Finland plc, New York, 0.35%		1/13/12		1/13/12		2,800,000		2,800,000
Rabobank Nederland NV, New York:
0.37%		2/9/12		2/9/12		5,000,000		5,000,000
0.46%1		2/16/12		5/16/12		2,500,000		2,500,000
Royal Bank of Canada, New York:
0.44%1		1/1/12		9/10/12		4,000,000		4,000,000
0.61%1		3/14/12		12/11/12		3,000,000		3,000,000
0.77%		11/28/12		11/28/12		1,300,000		1,300,000
Swedbank AB, New York, 0.06%		1/3/12		1/3/12		5,000,000		5,000,000
Toronto Dominion Bank, New York, 0.36%1		1/12/12		1/12/12		1,000,000		1,000,000
Total Certificates of Deposit (Cost $41,000,000)								41,000,000
Direct Bank Obligations — 15.0%
DnB NOR Bank ASA:
0.04%2		1/4/12		1/4/12		2,600,000		2,599,991
0.05%2		1/5/12		1/5/12		4,300,000		4,299,976
ING (US) Funding LLC, 0.26%		1/11/12		1/11/12		6,800,000		6,799,508
Nordea North America, Inc.:
0.33%		2/7/12		2/7/12		1,000,000		999,661
0.40%		1/24/12		1/24/12		1,700,000		1,699,566
Westpac Banking Corp.:
0.25%2		2/16/12		2/16/12		1,800,000		1,799,425
0.26%2		2/9/12		2/9/12		4,000,000		3,998,895
0.30%2		1/9/12		1/9/12		2,500,000		2,499,833
Total Direct Bank Obligations (Cost $24,696,855)								24,696,855
Short-Term Notes — 54.6%
Banks — 4.9%
HSBC USA, Inc.:
0.23%		2/16/12		2/16/12		5,000,000		4,998,531
0.23%		2/22/12		2/22/12		2,000,000		1,999,336
0.25%		2/10/12		2/10/12		1,100,000		1,099,694
								8,097,561
Diversified Financial Services — 3.7%
General Electric Capital Corp., 0.34%		6/19/12		6/19/12		2,400,000		2,396,147
General Electric Capital Services:
0.29%		4/5/12		4/5/12		2,400,000		2,398,163
0.29%		4/10/12		4/10/12		1,200,000		1,199,033
								5,993,343
Electric Utilities — 1.5%
Electricite De France, 0.43%2		1/27/12		1/27/12		2,400,000		2,399,255

5 | OPPENHEIMER MONEY FUND/VA

STATEMENT OF INVESTMENTS Continued

	Maturity		Final Legal		Principal
	Date**		Maturity Date***		Amount		Value
Leasing & Factoring — 8.9%
American Honda Finance Corp.:
0.68%1		3/29/12		6/29/12	$	1,500,000	$	1,500,000
0.74%1,3		3/27/12		3/27/12		2,000,000		2,000,255
0.82%1,3		3/26/12		9/26/12		1,500,000		1,500,000
5.10%3		3/27/12		3/27/12		1,300,000		1,313,806
Toyota Motor Credit Corp.:
0.35%		2/2/12		2/2/12		3,000,000		2,999,067
0.60%1		1/18/12		10/18/12		3,000,000		3,000,000
0.75%1		3/17/12		12/17/12		2,300,000		2,300,000
								14,613,128
Municipal — 11.3%
Austin Cnty., TX Industrial Development Corp. Revenue Bonds, Justin Industries, Inc., Series 1984, 0.10%1		1/7/12		1/7/12		5,000,000		5,000,000
Carroll Cnty., KY Solid Waste Disposal Revenue Bonds, North American Stainless Project, Series 2006, 0.09%1		1/7/12		1/7/12		4,300,000		4,300,000
Chicago, IL Industrial Development Revenue Bonds, Freedman Seating Co. Project, Series 1998, 0.24%1		1/7/12		1/7/12		1,215,000		1,215,000
Cobb Cnty., GA Development Authority Revenue Bonds, Presbyterian Village-Austell, Inc., 0.32%1		1/7/12		1/7/12		2,570,000		2,570,000
Health Care Revenue Bonds, SFO Associates Project, Series 1994, 0.27%1		1/7/12		1/7/12		1,500,000		1,500,000
IL Finance Authority, Freedman Seating Co. Project, Series 2005, 0.24%1		1/7/12		1/7/12		1,085,000		1,085,000
San Antonio, TX Industrial Development Authority Revenue Bonds, Tindall Corp. Project, 0.27%1		1/7/12		1/7/12		2,900,000		2,900,000
								18,570,000
Personal Products — 4.2%
Reckitt Benckiser Treasury Services plc:
0.42%2		1/30/12		1/30/12		2,000,000		1,999,323
0.50%2		3/9/12		3/9/12		2,800,000		2,797,356
0.70%2		7/6/12		7/6/12		2,000,000		1,992,728
								6,789,407
Receivables Finance — 9.1%
Alpine Securitization Corp., 0.23%		1/20/12		1/20/12		6,600,000		6,599,199
Market Street Funding LLC, 0.05%2		1/3/12		1/3/12		5,163,000		5,162,986
Mont Blanc Capital Corp., 0.32%2		1/11/12		1/11/12		1,500,000		1,499,867
Sheffield Receivables Corp., 0.25%2		1/13/12		1/13/12		1,700,000		1,699,858
								14,961,910
Special Purpose Financial — 11.0%
Concord Minutemen Cap. Corp. LLC:
0.35%		1/10/12		1/10/12		5,000,000		4,999,563
0.37%		1/12/12		1/12/12		1,000,000		999,887
0.52%		2/8/12		2/8/12		2,300,000		2,298,738
Crown Point Capital Co., 0.20%		1/3/12		1/3/12		4,000,000		3,999,956
FCAR Owner Trust I, 0.28%		1/9/12		1/9/12		3,000,000		2,999,813
Lexington Parker Capital Co. LLC, 0.47%2		2/2/12		2/2/12		2,800,000		2,798,830
								18,096,787
Total Short-Term Notes (Cost $89,521,391)								89,521,391

6 | OPPENHEIMER MONEY FUND/VA

	Maturity		Final Legal		Principal
	Date**		Maturity Date***		Amount			Value
U.S. Government Obligations — 3.7%
U.S. Treasury Nts.:
0.75%		5/31/12		5/31/12	$	2,000,000		$	2,003,805
1.00%		4/30/12		4/30/12		1,000,000			1,002,267
1.38%		2/15/12		2/15/12		2,000,000			2,002,559
4.50%		3/31/12		3/31/12		1,000,000			1,010,245
Total U.S. Government Obligations (Cost $6,018,876)									6,018,876
Total Investments, at Value (Cost $161,237,122)						98.3	%		161,237,122
Other Assets Net of Liabilities						1.7			2,736,272
Net Assets						100.0	%	$	163,973,394

Footnotes to Statement of Investments

* December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

Short-term notes and direct bank obligations are generally traded on a discount basis; the interest rate shown is the discount rate received by the Fund at the time of purchase. Other securities normally bear interest at the rates shown.

**	The Maturity Date represents the date used to calculate the Fund’s weighted average maturity as determined under Rule 2a-7.
***	If different from the Maturity Date, the Final Legal Maturity Date includes any maturity date extensions which may be affected at the option of the issuer or unconditional payments of principal by the issuer which may be affected at the option of the Fund, and represents the date used to calculate the Fund’s weighted average life as determined under Rule 2a-7.
1.	Represents the current interest rate for a variable or increasing rate security.
2.	Security issued in an exempt transaction without registration under the Securities Act of 1933. Such securities amount to $35,548,323 or 21.68% of the Fund’s net assets, and have been determined to be liquid pursuant to guidelines adopted by the Board of Trustees.
3.	Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $4,814,061 or 2.94% of the Fund’s net assets as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3–
	Level 1–		Level 2–		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Certificates of Deposit	$	—	$	41,000,000	$	—	$	41,000,000
Direct Bank Obligations		—		24,696,855		—		24,696,855
Short-Term Notes		—		89,521,391		—		89,521,391
U.S. Government Obligations		—		6,018,876		—		6,018,876
Total Assets	$	—	$	161,237,122	$	—	$	161,237,122

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

7 | OPPENHEIMER MONEY FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value (cost $161,237,122) — see accompanying statement of investments	$	161,237,122
Cash		2,936,335
Receivables and other assets:
Interest		70,460
Shares of beneficial interest sold		54,913
Other		13,757
Total assets		164,312,587
Liabilities
Payables and other liabilities:
Shares of beneficial interest redeemed		273,299
Shareholder communications		18,659
Legal, auditing and other professional fees		18,237
Transfer and shareholder servicing agent fees		14,215
Trustees’ compensation		8,479
Dividends		619
Other		5,685
Total liabilities		339,193
Net Assets	$	163,973,394
Composition of Net Assets
Par value of shares of beneficial interest	$	163,971
Additional paid-in capital		163,807,120
Accumulated net investment income		2,303
Net Assets — applicable to 163,971,175 shares of beneficial interest outstanding	$	163,973,394
Net Asset Value, Redemption Price Per Share and Offering Price Per Share	$	1.00

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

8 | OPPENHEIMER MONEY FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Investment Income
Interest	$	462,320
Expenses
Management fees		702,396
Transfer and shareholder servicing agent fees		156,086
Shareholder communications		34,071
Trustees’ compensation		16,805
Custodian fees and expenses		1,869
Administration service fees		1,500
Other		41,072
Total expenses		953,799
Less waivers and reimbursements of expenses		(507,756	)
Net expenses		446,043
Net Investment Income		16,277
Net Realized Gain on Investments		2,219
Net Increase in Net Assets Resulting from Operations	$	18,496

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

9 | OPPENHEIMER MONEY FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	16,277		$	11,351
Net realized gain		2,219			68
Net increase in net assets resulting from operations		18,496			11,419
Dividends and/or Distributions to Shareholders
Dividends from net investment income		(16,277	)		(46,794	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions		14,274,020			(31,222,151	)
Net Assets
Total increase (decrease)		14,276,239			(31,257,526	)
Beginning of period		149,697,155			180,954,681
End of period (including accumulated net investment income of $2,303 and $0, respectively)	$	163,973,394		$	149,697,155

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

10 | OPPENHEIMER MONEY FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended												Year Ended
	December 30,												December 31,
	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	1.00		$	1.00		$	1.00		$	1.00		$	1.00
Income from investment operations-net investment income and net realized gain2		—	3		—	3		—	3		.03			.05
Dividends and/or distributions to shareholders:
Dividends from net investment income		—	3		—	3		—	3		(.03	)		(.05	)
Distributions from net realized gain		—			—			—			—			—	3
Total dividends and/or distributions to shareholders		—	3		—	3		—	3		(.03	)		(.05	)
Net asset value, end of period	$	1.00		$	1.00		$	1.00		$	1.00		$	1.00
Total Return4		0.01	%		0.03	%		0.32	%		2.78	%		4.98	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	163,973		$	149,697		$	180,955		$	243,356		$	189,749
Average net assets (in thousands)	$	156,127		$	164,258		$	218,079		$	212,564		$	181,271
Ratios to average net assets:5
Net investment income		0.01	%		0.01	%		0.35	%		2.72	%		4.86	%
Total expenses		0.61	%		0.61	%		0.57	%		0.50	%		0.50	%
Expenses after payments, waivers and/or
reimbursements and reduction to custodian expenses		0.29	%		0.35	%		0.48	%		0.50	%		0.50	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Less than $0.005 per share.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.

See accompanying Notes to Financial Statements.

11 | OPPENHEIMER MONEY FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Money Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek maximum current income from investments in “money market” securities consistent with low capital risk and the maintenance of liquidity. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. Securities are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value. If amortized cost is determined not to approximate market value, the fair value of the portfolio securities will be determined under procedures approved by the Fund’s Board of Trustees.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

The tax components of capital shown in the following table represent distribution requirements the Fund must satisfy under the income tax regulations, losses the Fund may be able to offset against income and gains realized in future years for federal income tax purposes.

Undistributed Net		Undistributed		Accumulated Loss
Investment Income		Long-Term Gains		Carryforward
$	14,033	$	—	$	—

12 | OPPENHEIMER MONEY FUND/VA

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

		Reduction		Reduction to
		to Accumulated		Accumulated Net
Reduction to		Net Investment		Realized Gain
Paid-in Capital		Loss		on Investments
$	84	$	2,303	$	2,219

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	16,277	$	46,794

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income distributions, if any, are declared daily and paid monthly. Capital gain distributions, if any, are declared and paid annually but may be paid at other times to maintain the net asset value per share at $1.00.

Investment Income. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications.

13 | OPPENHEIMER MONEY FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Sold		112,694,489		$	112,694,489			64,871,083		$	64,871,083
Dividends and/or distributions reinvested		16,277			16,277			46,794			46,794
Redeemed		(98,436,746	)		(98,436,746	)		(96,140,028	)		(96,140,028	)
Net increase (decrease)		14,274,020		$	14,274,020			(31,222,151	)	$	(31,222,151	)

3. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $500 million	0.450	%
Next $500 million	0.425
Next $500 million	0.400
Over $1.5 billion	0.375

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $154,749 to OFS for services to the Fund.

Waivers and Reimbursements of Expenses. The Manager has voluntarily undertaken to waive fees and/or reimburse expenses to the extent necessary to assist the Fund in attempting to maintain a positive yield. There is no guarantee that the Fund will maintain a positive yield. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $507,756.

     The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as a percentage of daily net assets, will not exceed the annual rate of 0.50%.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

4. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name

14 | OPPENHEIMER MONEY FUND/VA

as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an

15 | OPPENHEIMER MONEY FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

4. Pending Litigation Continued affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

16 | OPPENHEIMER MONEY FUND/VA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Money Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Money Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Money Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

17 | OPPENHEIMER MONEY FUND/VA

FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

18 | OPPENHEIMER MONEY FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Carol Wolf and Christopher Proctor, the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The

19 | OPPENHEIMER MONEY FUND/VA

BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued

Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other money market instrument funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one-, three-, five-, and ten-year Lipper periods.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other money market instrument funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees were lower than its expense group median, although its total expenses were higher than its expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as a percentage of daily net assets, will not exceed the annual rate of 0.50%. The Board also considered that the Manager voluntarily agreed to waive and/or reimburse fees to the extent necessary to help maintain a positive yield. The voluntary expense limitation and voluntary fee waiver and/or reimbursement may not be amended or withdrawn until one year after the date of prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates. The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

20 | OPPENHEIMER MONEY FUND/VA

PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

21 | OPPENHEIMER MONEY FUND/VA

TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000-June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1990) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment

22 | OPPENHEIMER MONEY FUND/VA

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999-March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005- March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003- March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005- December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

23 | OPPENHEIMER MONEY FUND/VA

TRUSTEES AND OFFICERS Unaudited/Continued

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Mr. Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Proctor, Vandehey, Wixted, and Ms. Wolf, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Carol E. Wolf, Vice President (since 1998) Age: 60	Senior Vice President of the Manager (since June 2000) and of HarbourView Asset Management Corporation (since June 2003); Vice President of the Manager (June 1990-June 2000). A portfolio manager and officer of 6 portfolios in the OppenheimerFunds complex.
Christopher Proctor, Vice President (since 2010) Age: 43	Vice President of the Manager (since August 2008) and a Senior Analyst in the Money Market Fund Group responsible for leading the money market research team. A CFA and CTP with 20 years of credit research, trading and portfolio management experience in the money fund industry. Prior to joining the Manager, a Vice President at Calamos Asset Management (January 2007-March 2008) and Scudder-Kemper Investments (1999-2002), where he managed over $15 billion in institutional and retail money market products. A Managing Director and Co-Founder of Elmhurst Capital Management (June 2004-January 2007) and a Senior Manager of Research for Etrade Global Asset Management (2002-2004). A portfolio manager and officer of 5 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005- April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 1999) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999- June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

24 | OPPENHEIMER MONEY FUND/VA

OPPENHEIMER MONEY FUND/VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

© 2012 OppenheimerFunds, Inc. All rights reserved.

OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/ VA

Portfolio Managers: Arthur P. Steinmetz, Krishna Memani, Joseph Welsh, and Sara J. Zervos, Ph.D.

Average Annual Total Returns

For the Periods Ended 12/30/11¹

	1-Year			5-Year			10-Year
Non-Service Shares		0.85	%		5.33	%		7.03	%
Service Shares		0.65	%		5.08	%		6.71	%

Expense Ratios

For the Period Ended 12/30/11¹

	Gross			Net
	Expense			Expense
	Ratios			Ratios
Non-Service Shares		0.78	%		0.72	%
Service Shares		1.03			0.97

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Portfolio Allocation

* Represents a value of less than 0.05%.

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of investments.

Corporate Bonds & Notes–Top Ten Industries
Oil, Gas & Consumable Fuels	4.3	%
Commercial Banks	2.4
Electric Utilities	1.8
Media	1.4
Hotels, Restaurants & Leisure	1.2
Diversified Telecommunication Services	1.0
Wireless Telecommunication Services	1.0
Capital Markets	0.9
Metals & Mining	0.9
Energy Traders	0.9

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. For the 12-month period ended December 30, 2011, Oppenheimer Global Strategic Income Fund/VA’s Non-Service shares produced a total return of 0.85%¹. In comparison, the Barclays Capital U.S. Aggregate Bond Index and the Citigroup World Government Bond Index returned 7.84% and 6.35%, respectively. The Fund produced disappointing results in 2011 as U.S. and global bond markets struggled with heightened volatility stemming from macroeconomic developments that punished certain market sectors, often regardless of underlying credit fundamentals. Our fundamentals-based investment process proved relatively ineffective in this emotion-driven investment climate.

Economic and Market Overview

The opening months of 2011 generally were characterized by resilience among investors who looked forward to improved credit conditions in a recovering global economy. Even a wave of political unrest in the Middle East and natural disasters in Japan had only a temporary dampening effect on most financial markets in the first quarter of the year.

     Investor sentiment took a more sustained turn for the worse in late April, when U.S. economic data proved disappointing and a contentious political debate about government borrowing and spending intensified. These concerns reached a tipping point in early August, when the credit-rating agency Standard & Poor’s downgraded its assessment of long-term debt securities issued by the U.S. government. Meanwhile, international uncertainty worsened as it became clearer that Greece was probably headed for default and the sovereign debt crisis spread to other members of the European Union. Meanwhile, inflationary pressures mounted in China and other fast-growing emerging markets, where investors grew concerned that remedial measures might derail major engines of global growth. Market turbulence was particularly severe during August and September, as investors grew more worried about possible returns to recession in the United States and Europe.

     The ensuing flight to quality boosted traditional safe havens but hurt market sectors that historically have been considered riskier. In the United States, it is ironic that long-term U.S. Treasury securities gained value after their credit-rating downgrade, but high yield corporate bonds issued by companies with healthy balance sheets declined. Similarly, in international markets, fast-growing emerging markets mostly suffered during the downturn. Consequently, the U.S. dollar strengthened against most other currencies despite low short-term interest rates and a weak economy in the United States.

     Market sentiment improved during the fourth quarter when it became clearer that the United States had avoided a return to recession and European policymakers took steps to address the region’s crisis. However, modest improvements among U.S. high yield securities and some international bond markets was not enough to offset earlier weakness.

Fund Review

The Fund’s performance in 2011 was undermined by our asset allocation strategy. Overweight exposure to high yield corporate bonds proved especially damaging, particularly among paper and forest products companies. A bias toward lower-rated bonds along the high yield spectrum also hurt performance. In the international portfolio, overweight exposure to bonds and currencies in the emerging markets hampered returns. Conversely, an underweight position in U.S. government securities hurt results during the flight to quality. Although they comprise a relatively small portion of the Fund, holdings in other developed markets also detracted from returns, mainly due to weakness among European covered bonds and Spanish sovereign bonds.

     Our security selection strategies generally produced better relative results. Our focus on emerging bond markets offering higher inflation-adjusted returns—such as Brazil, South Africa, Mexico and Turkey—proved to be a bright spot during 2011. Underweight exposure to Eastern European bond markets also contributed positively to relative performance. Over the second half of the year, we reduced the Fund’s exposure to emerging markets’ currencies and the euro, helping to cushion the brunt of heightened volatility in currency markets. Among U.S. government securities, we favored mortgage-backed securities from U.S. government agencies, which provided higher yields than U.S. Treasury securities but did not gain as much value during the flight to quality. Modest allocations to non-agency residential mortgages and commercial mortgage-backed securities generally balanced any allocation-related weakness, enabling that portion

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

FUND PERFORMANCE DISCUSSION

of the Fund to achieve results that were roughly in line with market averages. Finally, a relatively short duration during the summer proved counterproductive, but its impact was limited as we soon moved back to a market-neutral position for the remainder of the year.

     Looking forward, we believe that investors will refocus on longer term credit fundamentals, rewarding issuers with healthier credit profiles and brighter economic prospects. Therefore, we currently are optimistic regarding high yield bonds, as many corporations have deleveraged their balance sheets and default rates remain low. Emerging markets bonds have fallen to low valuations compared to historical norms even though their economies have less debt, smaller budget deficits, higher inflation-adjusted bond yields and more robust economic growth rates than their more developed counterparts. However, we are less confident in the near-term outlook for emerging markets currencies and the euro relative to the U.S. dollar, leading us to maintain a relatively low level of exposure to currency markets.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. Performance is measured over a ten-fiscal-year period for both Classes. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the Barclays Capital U.S. Aggregate Bond Index, an unmanaged index of U.S. corporate and government bonds, and to the Citigroup World Government Bond Index, an unmanaged index of debt securities of major foreign governments. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the indices.

4 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Non-Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

Service Shares

Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results.

The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

5 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	962.40	$	3.55
Service shares		1,000.00		961.50		4.78
Hypothetical (5% return before expenses)
Non-Service shares		1,000.00		1,021.46		3.66
Service shares		1,000.00		1,020.21		4.92

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated funds, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service Shares		0.72	%
Service Shares		0.97

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

6 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Wholly-Owned Subsidiary—0.1%
Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd.1,2 (Cost $1,500,000)		15,000	$	1,482,519

	Principal
	Amount		Value
Asset-Backed Securities—1.0%
Argent Securities Trust 2004-W8, Asset-Backed Pass-Through Certificates, Series 2004-W8, Cl. A2, 1.254%, 5/25/343	$	924,857		779,615
Argent Securities Trust 2006-M3, Asset-Backed Pass-Through Certificates, Series 2006-M3, Cl. A2B, 0.394%, 9/25/363		349,382		102,707
Capital Auto Receivables Asset Trust 2007-1, Automobile Asset-Backed Securities, Series 2007-1, Cl. B, 5.15%, 9/17/12		75,367		75,678
Countrywide Home Loans, Asset-Backed Certificates, Series 2005-16, Cl. 2AF2, 5.377%, 5/1/363		946,187		726,914
CWABS Asset-Backed Certificates Trust 2006-25, Asset-Backed Certificates, Series 2006-25, Cl. 2A2, 0.414%, 6/25/473		4,747,180		4,197,656
CWHEQ Revolving Home Equity Loan Trust, Asset-Backed Certificates:
Series 2005-G, Cl. 2A, 0.508%, 12/15/353		170,607		93,939
Series 2006-H, Cl. 2A1A, 0.428%, 11/15/363		66,437		18,683
DSC Floorplan Master Owner Trust, Automobile Receivable Nts., Series 2011-1, Cl. A, 3.91%, 3/15/16		520,000		527,045
DT Auto Owner Trust 2011-1A, Automobile Receivable Nts., Series 2011-1A, Cl. C, 3.05%, 8/15/154		720,000		721,378
Embarcadero Aircraft Securitization Trust, Airplane Receivable Nts., Series 2000-A, Cl. B, 0.656%, 8/15/255,6		1,820,063		—
GE Dealer Floorplan Master Note Trust, Asset-Backed Securities, Series 2009-2A, Cl. A, 1.828%, 10/20/143,4		270,000		272,383
GMAC Mortgage Servicer Advance Funding Ltd., Asset-Backed Nts., Series 2011-1A, Cl. A, 3.72%, 2/15/234		580,000		579,958
Home Equity Mortgage Trust 2005-1, Mtg. Pass-Through Certificates, Series 2005-1, Cl. M6, 5.863%, 6/1/35		1,046,000		562,302
Ice 1 Em CLO Ltd./Ice 1 Em CLO Corp., Sr. Sec. Sub. Term Nts.:
Series 2007-1A, Cl. B, 2.152%, 8/15/223,6		7,870,000		5,115,500
Series 2007-1A, Cl. C, 3.452%, 8/15/223,6		5,270,000		3,320,100
Series 2007-1A, Cl. D, 5.452%, 8/15/223,6		5,270,000		3,425,500
Mastr Asset-Backed Securities Trust 2006-WMC3, Mtg. Pass-Through Certificates, Series 2006-WMC3, Cl. A3, 0.394%, 8/25/363		1,188,754		362,295
NC Finance Trust, Collateralized Mtg. Obligation Pass-Through Certificates, Series 1999-I, Cl. ECFD, 3.405%, 1/25/295,6		66,744		6,007
Popular ABS Mortgage Pass-Through Trust 2005-6, Mtg. Pass-Through Certificates, Series 2005-6, Cl. A3, 5.68%, 1/1/36		189,500		164,109
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/176		227,466		225,476
SLM Student Loan Trust, Student Loan Receivables, Series 2005-B, Cl. B, 0.946%, 6/15/393		2,487,000		1,257,532
Terwin Mortgage Trust, Home Equity Asset-Backed Securities, Series 2006-4SL, Cl. A1, 3.383%, 5/1/373,4,7		170,566		89,780
Total Asset-Backed Securities (Cost $32,000,626)				22,624,557
Mortgage-Backed Obligations—19.9%
Government Agency—7.5%
FHLMC/FNMA/FHLB/Sponsored—7.1%
Federal Home Loan Mortgage Corp.:
4.50%, 1/1/428		4,305,000		4,562,627
5%, 9/15/33		1,552,261		1,671,403
5.50%, 9/1/39		1,427,254		1,551,743
6%, 5/15/18-10/1/37		764,536		838,676
6.50%, 3/15/18-8/15/32		1,738,287		1,957,263
7%, 10/1/31-10/1/37		442,310		507,122
7.50%, 1/1/32		707,518		846,381
Federal Home Loan Mortgage Corp., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Series 1360, Cl. PZ, 7.50%, 9/15/22		798,690		911,282
Series 151, Cl. F, 9%, 5/15/21		23,166		26,513
Series 1674, Cl. Z, 6.75%, 2/15/24		641,374		726,477
Series 1897, Cl. K, 7%, 9/15/26		1,453,093		1,676,511
Series 2006-11, Cl. PS, 23.49%, 3/25/363		465,443		649,970
Series 2043, Cl. ZP, 6.50%, 4/15/28		590,196		676,847
Series 2106, Cl. FG, 0.728%, 12/15/283		1,008,882		1,012,239
Series 2122, Cl. F, 0.728%, 2/15/293		30,094		30,144
Series 2148, Cl. ZA, 6%, 4/15/29		830,754		921,580
Series 2195, Cl. LH, 6.50%, 10/15/29		449,972		526,132
Series 2326, Cl. ZP, 6.50%, 6/15/31		61,505		71,262
Series 2344, Cl. FP, 1.228%, 8/15/313		306,003		310,421

7 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
FHLMC/FNMA/FHLB/Sponsored Continued
Federal Home Loan Mortgage Corp., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates: Continued
Series 2368, Cl. PR, 6.50%, 10/15/31	$	249,716	$	282,711
Series 2412, Cl. GF, 1.228%, 2/15/323		571,056		580,736
Series 2449, Cl. FL, 0.828%, 1/15/323		392,333		395,215
Series 2451, Cl. FD, 1.278%, 3/15/323		199,396		202,999
Series 2453, Cl. BD, 6%, 5/15/17		85,469		91,145
Series 2461, Cl. PZ, 6.50%, 6/15/32		933,500		1,059,538
Series 2464, Cl. FI, 1.278%, 2/15/323		187,960		190,735
Series 2470, Cl. AF, 1.278%, 3/15/323		342,114		351,102
Series 2470, Cl. LF, 1.278%, 2/15/323		192,350		195,896
Series 2471, Cl. FD, 1.278%, 3/15/323		288,242		293,191
Series 2477, Cl. FZ, 0.828%, 6/15/313		765,919		770,618
Series 2500, Cl. FD, 0.778%, 3/15/323		25,512		25,637
Series 2517, Cl. GF, 1.278%, 2/15/323		167,239		170,221
Series 2526, Cl. FE, 0.678%, 6/15/293		47,899		48,067
Series 2551, Cl. FD, 0.678%, 1/15/333		22,098		22,165
Series 2676, Cl. KY, 5%, 9/15/23		3,608,534		3,944,893
Series 3019, Cl. MD, 4.75%, 1/1/31		315,800		317,421
Series 3025, Cl. SJ, 23.73%, 8/15/353		513,369		734,124
Series 3094, Cl. HS, 23.363%, 6/15/343		297,214		402,413
Series 3822, Cl. JA, 5%, 6/1/40		170,266		184,389
Series 3848, Cl. WL, 4%, 4/1/40		767,936		811,707
Series 3917, Cl. BA, 4%, 6/1/38		1,320,412		1,382,038
Federal Home Loan Mortgage Corp., Interest-Only Stripped Mtg.-Backed Security:
Series 192, Cl. IO, 13.393%, 2/1/289		22,180		4,241
Series 205, Cl. IO, 13.251%, 9/1/299		119,604		20,719
Series 2074, Cl. S, 62.824%, 7/17/289		31,828		6,817
Series 2079, Cl. S, 73.84%, 7/17/289		53,596		11,558
Series 2136, Cl. SG, 75.075%, 3/15/299		1,431,324		285,517
Series 2399, Cl. SG, 71.666%, 12/15/269		838,202		165,928
Series 243, Cl. 6, 0.369%, 12/15/329		327,532		59,494
Series 2437, Cl. SB, 83.176%, 4/15/329		2,539,180		556,130
Series 2526, Cl. SE, 39.476%, 6/15/299		60,136		12,138
Series 2795, Cl. SH, 13.471%, 3/15/249		1,239,510		160,232
Series 2802, Cl. AS, 63.634%, 4/15/339		304,023		21,790
Series 2920, Cl. S, 63.733%, 1/15/359		542,641		91,968
Series 3110, Cl. SL, 17.819%, 2/15/269		314,249		40,276
Series 3451, Cl. SB, 20.75%, 5/15/389		947,767		112,971
Federal National Mortgage Assn.:
2.579%, 10/1/363		4,285,194		4,533,517
3.50%, 1/1/278		6,720,000		7,028,700
4%, 1/1/428		11,090,000		11,653,165
4.50%, 1/1/27-1/1/428		19,385,000		20,641,338
5%, 2/25/18-7/25/33		6,802,242		7,353,055
5%, 1/1/428		11,080,000		11,971,597
5.50%, 4/25/21-1/1/36		794,461		865,905
5.50%, 1/1/27-1/1/428		7,563,000		8,231,582
6%, 10/25/16-1/25/19		455,006		491,642
6%, 1/1/428		7,020,000		7,730,777
6.50%, 4/25/17-1/1/34		2,202,341		2,507,741
7%, 11/1/17-6/25/34		2,333,042		2,701,329
7.50%, 2/25/27-3/25/33		2,569,528		3,061,726
8.50%, 7/1/32		3,047		3,725
Federal National Mortgage Assn., 15 yr.:
3%, 1/1/278		12,330,000		12,736,504
4%, 1/1/278		355,000		374,470
Federal National Mortgage Assn., Gtd. Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates:
Trust 1999-54, Cl. LH, 6.50%, 11/25/29		442,685		507,447
Trust 2001-51, Cl. OD, 6.50%, 10/25/31		239,049		277,602
Trust 2001-69, Cl. PF, 1.294%, 12/25/313		425,974		436,076
Trust 2001-80, Cl. ZB, 6%, 1/25/32		496,676		559,586
Trust 2002-12, Cl. PG, 6%, 3/25/17		283,340		306,448
Trust 2002-29, Cl. F, 1.294%, 4/25/323		207,038		211,910
Trust 2002-60, Cl. FH, 1.294%, 8/25/323		425,986		434,155
Trust 2002-64, Cl. FJ, 1.294%, 4/25/323		63,754		65,254
Trust 2002-68, Cl. FH, 0.785%, 10/18/323		143,888		144,867
Trust 2002-84, Cl. FB, 1.294%, 12/25/323		887,171		908,127
Trust 2002-9, Cl. PC, 6%, 3/25/17		287,527		312,608
Trust 2002-9, Cl. PR, 6%, 3/25/17		352,063		377,301
Trust 2002-90, Cl. FH, 0.794%, 9/25/323		496,374		499,657
Trust 2003-11, Cl. FA, 1.294%, 9/25/323		887,191		908,148
Trust 2003-116, Cl. FA, 0.694%, 11/25/333		69,466		69,806
Trust 2004-101, Cl. BG, 5%, 1/25/20		1,316,490		1,410,171
Trust 2005-109, Cl. AH, 5.50%, 12/25/25		2,160,000		2,450,278
Trust 2005-12, Cl. JC, 5%, 6/1/28		266,423		267,176
Trust 2005-25, Cl. PS, 26.868%, 4/25/353		488,754		820,394
Trust 2005-31, Cl. PB, 5.50%, 4/25/35		560,000		681,333
Trust 2005-71, Cl. DB, 4.50%, 8/25/25		480,000		522,160
Trust 2006-46, Cl. SW, 23.123%, 6/25/363		777,236		1,085,220
Trust 2007-42, Cl. A, 6%, 2/1/33		915,470		959,473
Trust 2009-114, Cl. AC, 2.50%, 12/1/23		311,959		320,010
Trust 2009-36, Cl. FA, 1.234%, 6/25/373		385,345		390,157
Trust 2011-122, Cl. EC, 1.50%, 1/1/20		820,401		824,162
Trust 2011-15, Cl. DA, 4%, 3/1/41		931,138		985,604
Trust 2011-3, Cl. KA, 5%, 4/1/40		575,548		623,764
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Trust 2001-61, Cl. SH, 37.704%, 11/18/319		234,604		42,227
Trust 2001-63, Cl. SD, 35.045%, 12/18/319		59,030		10,517

8 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount		Value
FHLMC/FNMA/FHLB/Sponsored Continued
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security: Continued
Trust 2001-68, Cl. SC, 26.039%, 11/25/319	$	38,890	$	7,047
Trust 2001-81, Cl. S, 31.912%, 1/25/329		47,787		9,450
Trust 2002-28, Cl. SA, 38.153%, 4/25/329		30,886		5,726
Trust 2002-38, Cl. SO, 53.793%, 4/25/329		169,634		30,920
Trust 2002-48, Cl. S, 34.30%, 7/25/329		47,976		9,060
Trust 2002-52, Cl. SL, 36.455%, 9/25/329		31,036		5,925
Trust 2002-56, Cl. SN, 36.411%, 7/25/329		65,925		12,458
Trust 2002-77, Cl. IS, 48.559%, 12/18/329		289,005		59,051
Trust 2002-77, Cl. SH, 41.779%, 12/18/329		67,790		13,251
Trust 2002-9, Cl. MS, 33.312%, 3/25/329		63,634		12,339
Trust 2003-13, Cl. IO, 13.82%, 3/25/339		540,362		93,726
Trust 2003-26, Cl. DI, 11.494%, 4/25/339		395,052		65,357
Trust 2003-33, Cl. SP, 40.352%, 5/25/339		419,984		68,524
Trust 2003-38, Cl. SA, 30.916%, 3/25/239		606,686		69,625
Trust 2003-4, Cl. S, 36.632%, 2/25/339		122,727		21,570
Trust 2004-56, Cl. SE, 16.089%, 10/25/339		1,806,946		253,761
Trust 2005-14, Cl. SE, 41.639%, 3/25/359		1,742,433		252,789
Trust 2005-40, Cl. SA, 60.568%, 5/25/359		1,483,373		264,146
Trust 2005-40, Cl. SB, 95.476%, 5/25/359		2,468,634		418,611
Trust 2005-63, Cl. SA, 63.832%, 10/25/319		99,426		17,871
Trust 2005-71, Cl. SA, 61.309%, 8/25/259		339,035		47,534
Trust 2006-129, Cl. SM, 28.813%, 1/25/379		658,070		94,284
Trust 2006-51, Cl. SA, 17.813%, 6/25/369		8,463,081		1,224,053
Trust 2006-60, Cl. DI, 38.936%, 4/25/359		1,548,211		223,361
Trust 2006-90, Cl. SX, 99.999%, 9/25/369		1,565,790		298,819
Trust 2007-77, Cl. SB, 56.307%, 12/25/319		691,996		37,991
Trust 2007-88, Cl. XI, 35.108%, 6/25/379		2,501,195		356,828
Trust 2008-55, Cl. SA, 23.905%, 7/25/389		532,996		59,164
Trust 2011-84, Cl. IG, 4.92%, 8/1/139		5,366,801		137,951
Trust 214, Cl. 2, 41.274%, 3/1/239		370,937		67,710
Trust 221, Cl. 2, 38.496%, 5/1/239		42,507		7,780
Trust 254, Cl. 2, 31.151%, 1/1/249		697,834		127,788
Trust 2682, Cl. TQ, 99.999%, 10/15/339		571,463		106,244
Trust 2981, Cl. BS, 99.999%, 5/15/359		1,019,013		183,934
Trust 301, Cl. 2, 2.073%, 4/1/299		153,582		27,773
Trust 313, Cl. 2, 26.257%, 6/1/319		1,608,650		274,972
Trust 319, Cl. 2, 3.266%, 2/1/329		761,365		137,820
Trust 321, Cl. 2, 6.86%, 4/1/329		203,135		36,724
Trust 324, Cl. 2, 1.58%, 7/1/329		211,436		37,644
Trust 328, Cl. 2, 42.821%, 12/1/329		510,716		82,614
Trust 331, Cl. 5, 0%, 2/1/339,10		781,185		131,962
Trust 332, Cl. 2, 27.257%, 3/1/339		4,413,971		628,364
Trust 334, Cl. 12, 0.446%, 2/1/339		684,890		113,386
Trust 339, Cl. 15, 11.083%, 7/1/339		2,043,961		380,823
Trust 345, Cl. 9, 0%, 1/1/349,10		826,281		106,928
Trust 351, Cl. 10, 0.817%, 4/1/349		421,219		61,461
Trust 351, Cl. 8, 1.478%, 4/1/349		689,945		101,701
Trust 356, Cl. 10, 1.226%, 6/1/359		566,825		82,597
Trust 356, Cl. 12, 1.931%, 2/1/359		284,041		41,407
Trust 362, Cl. 13, 3.475%, 8/1/359		344,636		55,272
				159,745,840
GNMA/Guaranteed—0.2%
Government National Mortgage Assn.:
2.125%, 12/9/253		5,206		5,369
7%, 3/29/28-7/29/28		232,865		271,537
7.50%, 3/1/27		12,567		13,723
8%, 11/29/25-5/29/26		49,596		51,773
Government National Mortgage Assn., Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates:
Series 1999-32, Cl. ZB, 8%, 9/16/29		936,074		1,115,418
Series 2000-12, Cl. ZA, 8%, 2/16/30		2,090,283		2,509,646
Government National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Series 1998-19, Cl. SB, 70.595%, 7/16/289		114,873		24,854
Series 1998-6, Cl. SA, 82.586%, 3/16/289		67,415		14,301
Series 2001-21, Cl. SB, 92.265%, 1/16/279		510,626		100,562
Series 2007-17, Cl. AI, 21.009%, 4/16/379		608,584		114,146
Series 2010-111, Cl. GI, 22.59%, 9/1/139		12,744,832		341,607
				4,562,936

9 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Other Agency—0.2%
NCUA Guaranteed Notes Trust 2010-C1, Gtd. Nts.:
Series 2010-C1, Cl. A1, 1.60%, 10/29/20	$	522,335	$	529,399
Series 2010-C1, Cl. A2, 2.90%, 10/29/20		1,015,000		1,073,156
Series 2010-C1, Cl. APT, 2.65%, 10/29/20		1,165,858		1,220,005
NCUA Guaranteed Notes Trust 2010-R1, Gtd. Nts., Series 2010-R1, Cl. 1A, 0.724%, 10/7/203		1,026,754		1,027,873
NCUA Guaranteed Notes Trust 2010-R3, Gtd. Nts., Series 2010-R3, Cl. 3A, 2.40%, 12/8/20		828,953		841,909
				4,692,342
Non-Agency—12.4%
Commercial—7.4%
Banc of America Commercial Mortgage Trust 2006-3, Commercial Mtg. Pass-Through Certificates, Series 2006-3, Cl. AM, 5.858%, 7/10/443		4,192,000		4,060,143
Banc of America Commercial Mortgage Trust 2006-5, Commercial Mtg. Pass-Through Certificates, Series 2006-5, Cl. AM, 5.448%, 9/1/47		6,055,000		5,720,628
Banc of America Commercial Mortgage Trust 2007-1, Commercial Mtg. Pass-Through Certificates, Series 2007-1, Cl. AMFX, 5.482%, 1/1/49		4,159,386		3,896,452
Banc of America Commercial Mortgage Trust 2007-5, Commercial Mtg. Pass-Through Certificates, Series 2007-5, Cl. AM, 5.772%, 2/1/51		8,090,000		7,660,271
Banc of America Commercial Mortgage, Inc., Commercial Mtg. Pass-Through Certificates:
Series 2007-3, Cl. A4, 5.622%, 6/1/493		480,000		516,735
Series 2008-1, Cl. AM, 6.249%, 2/10/513		3,415,000		3,372,832
Bear Stearns ARM Trust 2007-4, Mtg. Pass-Through Certificates, Series 2007-4, Cl. 22A1, 5.669%, 6/1/473		1,096,341		766,687
Bear Stearns Commercial Mortgage Securities Trust 2006-PWR13, Commercial Mtg. Pass-Through Certificates, Series 2006-PWR13, Cl. AJ, 5.611%, 9/1/41		6,630,000		4,565,856
Bear Stearns Commercial Mortgage Securities Trust 2007-PWR17, Commercial Mtg. Pass-Through Certificates:
Series 2007-PWR17, Cl. AJ, 5.897%, 6/1/503		7,400,000		4,960,683
Series 2007-PWR17, Cl. AM, 5.915%, 6/1/50		2,330,000		2,310,698
CHL Mortgage Pass-Through Trust 2005-17, Mtg. Pass-Through Certificates, Series 2005-17, Cl. 1A8, 5.50%, 9/1/35		3,149,421		3,006,499
CHL Mortgage Pass-Through Trust 2005-HYB8, Mtg. Pass-Through Certificates, Series 2005-HYB8, Cl. 4A1, 5.006%, 12/20/353		168,475		125,414
CHL Mortgage Pass-Through Trust 2007-J3, Mtg. Pass-Through Certificates, Series 2007-J3, Cl. A9, 6%, 7/1/37		9,122,866		7,219,453
Citigroup Commercial Mortgage Trust 2008-C7, Commercial Mtg. Pass-Through Certificates, Series 2008-C7, Cl. AM, 6.072%, 12/1/493		4,270,000		4,324,176
Citigroup, Inc./Deutsche Bank 2007-CD4 Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2007-CD4, Cl. A4, 5.322%, 12/1/49		955,000		1,016,804
DBUBS Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2011-LC1, Cl. E, 5.557%, 11/1/463,4		2,515,000		2,079,576
Deutsche Alt-A Securities, Inc., Mtg. Pass-Through Certificates, Series 2007-RS1, Cl. A2, 0.794%, 1/27/373,6		1,329,704		605,015
Deutsche Alt-B Securities, Inc., Mtg. Pass-Through Certificates:
Series 2006-AB2, Cl. A1, 5.885%, 6/25/36		133,150		81,735
Series 2006-AB4, Cl. A1A, 6.005%, 10/25/36		654,918		358,766
Deutsche Mortgage & Asset Receiving, Commercial Mtg. Pass-Through Certificates, Interest-Only Stripped Mtg.-Backed Security, Series 2010-C1, Cl. XPA, 4.858%, 9/1/204,9		5,625,940		422,823
First Horizon Alternative Mortgage Securities Trust 2007-FA2, Mtg. Pass-Through Certificates, Series 2007-FA2, Cl. 1A1, 5.50%, 4/25/37		612,819		402,037

10 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount		Value
Commercial Continued
First Horizon Mortgage Pass-Through Trust 2007-AR3, Mtg. Pass-Through Certificates, Series 2007-AR3, Cl. 1A1, 5.857%, 11/1/373	$	3,351,000	$	2,045,489
GMAC Commercial Mortgage Securities, Inc., Commercial Mtg. Pass-Through Certificates, Series 1998-C1, Cl. F, 6.97%, 5/15/303		1,567,000		1,537,230
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2006-GG7, Commercial Mtg. Pass-Through Certificates, Series 2006-GG7, Cl. AJ, 5.882%, 7/10/383		6,150,000		4,327,531
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG11, Commercial Mtg. Pass-Through Certificates, Series 2007-GG11, Cl. AM, 5.867%, 12/1/49		5,550,000		4,945,075
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. AM, 5.475%, 3/1/39		615,000		579,913
GS Mortgage Securities Corp. II, Commercial Mtg. Obligations, Series 2011-GC3, Cl. D, 5.543%, 3/1/443,4		3,130,000		2,449,382
GSR Mortgage Loan Trust 2005-AR4, Mtg. Pass-Through Certificates, Series 2005-AR4, Cl. 6A1, 5.25%, 7/1/35		79,796		73,623
Impac CMB Trust Series 2005-4, Collateralized Asset-Backed Bonds, Series 2005-4, Cl. 1A1A, 0.834%, 5/25/353		5,268,225		3,587,226
IndyMac Index Mortgage Loan Trust 2005-AR23, Mtg. Pass-Through Certificates, Series 2005-AR23, Cl. 6A1, 5.11%, 11/1/353		1,607,959		1,095,990
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial Mtg. Pass-Through Certificates:
Series 2006-CIBC15, Cl. AM, 5.855%, 6/1/43		775,000		760,626
Series 2007-CB15, Cl. AJ, 5.502%, 6/1/47		8,281,000		4,852,376
Series 2007-CB18, Cl. A4, 5.44%, 6/1/47		2,315,000		2,490,649
Series 2007-CB18, Cl. AM, 5.466%, 6/1/47		6,400,000		6,009,632
Series 2008-C2, Cl. AM, 6.785%, 2/1/513		4,990,000		4,467,462
JPMorgan Chase Commercial Mortgage Securities Trust 2006-CIBC16, Commercial Mtg. Pass-Through Certificates, Series 2006-CIBC16, Cl. AJ, 5.623%, 5/1/45		2,175,000		1,660,746
JPMorgan Chase Commercial Mortgage Securities Trust 2006-LDP7, Commercial Mtg. Pass-Through Certificates, Series 2006-LDP7, 5.875%, 4/1/453		120,000		123,999
JPMorgan Chase Commercial Mortgage Securities Trust 2007-CB19, Commercial Mtg. Pass-Through Certificates, Series 2007-CB19, Cl. AM, 5.74%, 2/1/493		5,850,000		5,572,195
JPMorgan Chase Commercial Mortgage Securities Trust 2007-LDP11, Commercial Mtg. Pass-Through Certificates, Series 2007-LDP11, Cl. ASB, 5.817%, 6/1/493		570,000		607,200
JPMorgan Mortgage Trust 2006-A7, Mtg. Pass-Through Certificates, Series 2006-A7, Cl. 2A2, 2.756%, 1/1/373		337,389		221,331
LB-UBS Commercial Mortgage Trust 2007-C2, Commercial Mtg. Pass-Through Certificates, Series 2007-C2, Cl. AM, 5.493%, 2/11/40		2,950,000		2,753,689
LB-UBS Commercial Mortgage Trust 2007-C6, Commercial Mtg. Pass-Through Certificates:
Series 2007-C6, Cl. A4, 5.858%, 7/11/40		1,095,000		1,204,368
Series 2007-C6, Cl. AM, 6.114%, 7/11/40		5,855,000		5,512,272
LB-UBS Commercial Mortgage Trust 2008-C1, Commercial Mtg. Pass-Through Certificates, Series 2008-C1, Cl. AM, 6.145%, 4/11/413		2,610,000		2,535,524
Lehman Structured Securities Corp., Mtg.-Backed Security, 6%, 5/1/29		73,876		12,516
Mastr Alternative Loan Trust 2004-6, Mtg. Pass-Through Certificates, Series 2004-6, Cl. 10A1, 6%, 7/25/34		259,554		266,430
Merrill Lynch Mortgage Trust 2006-C1, Commercial Mtg. Pass-Through Certificates, Series 2006-C1, Cl. AJ, 5.666%, 5/1/393		3,845,000		3,241,873

11 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Commercial Continued
ML-CFC Commercial Mortgage Trust 2006-3, Commercial Mtg. Pass-Through Certificates, Series 2006-3, Cl. AJ, 5.485%, 7/1/46	$	3,745,000	$	2,838,159
Morgan Stanley Capital I Trust 2006-IQ12, Commercial Mtg. Pass-Through Certificates, Series 2006-IQ12, Cl. AJ, 5.399%, 12/1/43		7,734,000		4,700,083
Morgan Stanley Capital I Trust 2007-IQ15, Commercial Mtg. Pass-Through Certificates, Series 2007-IQ15, Cl. AM, 5.879%, 6/1/493		6,485,000		6,131,606
Morgan Stanley Capital I Trust, Commercial Mtg. Pass-Through Certificates, Series 2006-HQ10, Cl. AM, 5.36%, 11/1/41		8,500,000		8,477,280
RALI Series 2005-QA4 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2005-QA4, Cl. A32, 3.187%, 4/25/353		116,489		14,920
Residential Asset Securitization Trust 2006-A12, Mtg. Pass-Through Certificates, Series 2006-A12, Cl. 1A, 6.25%, 11/1/36		713,314		476,645
STARM Mortgage Loan Trust 2007-1, Mtg. Pass-Through Certificates, Series 2007-1, Cl. 2A1, 5.801%, 2/1/373		9,310,563		5,932,440
Structured Adjustable Rate Mortgage Loan Trust, Mtg. Pass-Through Certificates, Series 2007-6, Cl. 3A1, 5.118%, 7/1/373		6,989,720		4,207,647
Wachovia Bank Commercial Mortgage Trust 2006-C23, Commercial Mtg. Pass-Through Certificates, Series 2006-C23, Cl. AJ, 5.515%, 1/1/45		4,510,000		3,610,068
Wachovia Bank Commercial Mortgage Trust 2006-C25, Commercial Mtg. Pass-Through Certificates, Series 2006-C25, Cl. AJ, 5.737%, 5/1/433		4,220,000		3,632,665
WaMu Mortgage Pass-Through Certificates 2006-AR15 Trust, Mtg. Pass-Through Certificates, Series 2006-AR15, Cl. 1A, 1.048%, 11/1/463		1,187,074		659,868
WaMu Mortgage Pass-Through Certificates 2007-OA3 Trust, Mtg. Pass-Through Certificates, Series 2007-OA3, Cl. 5A, 2.526%, 4/1/473		827,150		411,370
Wells Fargo Mortgage-Backed Securities 2004-W Trust, Mtg. Pass-Through Certificates, Series 2004-W, Cl. B2, 2.608%, 11/1/343		870,224		45,914
Wells Fargo Mortgage-Backed Securities 2005-AR1 Trust, Mtg. Pass-Through Certificates, Series 2005-AR1, Cl. 1A1, 2.719%, 2/1/353		3,709,449		3,270,731
Wells Fargo Mortgage-Backed Securities 2007-AR3 Trust, Mtg. Pass-Through Certificates, Series 2007-AR3, Cl. A4, 5.777%, 4/1/373		2,440,511		1,971,911
WFRBS Commercial Mortgage Trust 2011-C3, Interest-Only Commercial Mtg. Pass-Through Certificates, Series 2011-C3, Cl. XA, 7.982%, 3/1/449		6,107,862		542,552
				167,331,489
Multifamily—0.9%
Banc of America Commercial Mortgage, Inc., Commercial Mtg. Pass-Through Certificates, Series 2006-2, Cl. AJ, 5.766%, 5/1/453		4,295,000		3,202,303
Citigroup Commercial Mortgage Trust 2006-C5, Commercial Mtg. Pass-Through Certificates, Series 2006-C5, Cl. AJ, 5.482%, 10/1/49		5,792,000		4,761,261
Citigroup Mortgage Loan Trust, Inc. 2006-AR3, Mtg. Pass-Through Certificates, Series 2006-AR3, Cl. 1A2A, 5.672%, 6/1/363		6,101,361		4,978,900
JPMorgan Mortgage Trust 2007-A3, Mtg. Pass-Through Certificates, Series 2007-A3, Cl. 3A2M, 5.259%, 5/1/373		4,714,939		3,815,300
Wells Fargo Mortgage-Backed Securities 2005-AR15 Trust, Mtg. Pass-Through Certificates, Series 2005-AR15, Cl. 1A2, 5.036%, 9/1/353		432,581		374,521
Wells Fargo Mortgage-Backed Securities 2006-AR6 Trust, Mtg. Pass-Through Certificates, Series 2006-AR6, Cl. 3A1, 2.689%, 3/25/363		3,320,552		2,655,264
				19,787,549

12 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount		Value
Other—0.1%
Greenwich Capital Commercial Funding Corp./Commercial Mortgage Trust 2007-GG9, Commercial Mtg. Pass-Through Certificates, Series 2007-GG9, Cl. A4, 5.444%, 3/1/39	$	2,315,000		$	2,515,239
Residential—4.0%
Banc of America Commercial Mortgage, Inc., Commercial Mtg. Pass-Through Certificates, Series 2007-4, Cl. AM, 5.791%, 2/1/513		3,960,000			3,762,857
Banc of America Funding 2007-C Trust, Mtg. Pass-Through Certificates, Series 2007-C, Cl. 1A4, 5.544%, 5/1/363		2,025,000			1,794,477
Bear Stearns ARM Trust 2004-2, Mtg. Pass-Through Certificates, Series 2004-2, Cl. 12A2, 2.741%, 5/1/343		3,018,185			2,431,936
Bear Stearns ARM Trust 2004-9, Mtg. Pass-Through Certificates, Series 2004-9, Cl. 23A1, 3.372%, 11/1/343		908,812			861,108
Chase Mortgage Finance Trust 2007-A1, Multiclass Mtg. Pass-Through Certificates, Series 2007-A1, Cl. 9A1, 2.744%, 2/1/373		1,132,270			1,110,849
CHL Mortgage Pass-Through Trust 2005-29, Mtg. Pass-Through Certificates, Series 2005-29, Cl. A1, 5.75%, 12/1/35		6,019,799			5,049,787
CHL Mortgage Pass-Through Trust 2005-J4, Mtg. Pass-Through Certificates, Series 2005-J4, Cl. A7, 5.50%, 11/1/35		1,906,449			1,845,680
CHL Mortgage Pass-Through Trust 2006-6, Mtg. Pass-Through Certificates, Series 2006-6, Cl. A3, 6%, 4/1/36		661,883			629,748
CHL Mortgage Pass-Through Trust 2007-HY3, Mtg. Pass-Through Certificates, Series 2007-HY3, Cl. 1A1, 2.965%, 6/1/473		2,149,082			1,391,123
Citigroup Mortgage Loan Trust, Inc. 2005-2, Mtg. Pass-Through Certificates, Series 2005-2, Cl. 1A3, 4.051%, 5/1/353		2,424,426			2,014,351
Citigroup Mortgage Loan Trust, Inc. 2005-3, Mtg. Pass-Through Certificates, Series 2005-3, Cl. 2A4, 5.058%, 8/1/353		4,857,841			3,245,723
Citigroup, Inc./Deutsche Bank 2007-CD4 Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 2007-CD4, Cl. AMFX, 5.366%, 12/1/49		6,060,000			5,309,002
CitiMortgage Alternative Loan Trust 2006-A5, Real Estate Mtg. Investment Conduit Pass-Through Certificates, Series 2006-A5, Cl. 2A1, 5.50%, 10/1/21		1,514,273			1,423,222
Countrywide Alternative Loan Trust 2006-43CB, Mtg. Pass-Through Certificates, Series 2006-43CB, Cl.1A10, 6%, 2/1/37		10,030,047			6,250,926
Countrywide Alternative Loan Trust 2007-19, Mtg. Pass-Through Certificates, Series 2007-19, Cl. 1A4, 6%, 8/1/37		2,836,165			1,951,988
GSR Mortgage Loan Trust 2004-5, Mtg. Pass-Through Certificates, Series 2004-5, Cl. 2A1, 2.774%, 5/1/343		2,941,179			2,355,158
GSR Mortgage Loan Trust 2005-AR7, Mtg. Pass-Through Certificates, Series 2005-AR7, Cl. 4A1, 5.195%, 11/1/353		3,224,679			2,385,443
GSR Mortgage Loan Trust 2006-5F, Mtg. Pass-Through Certificates, Series 2006-5F, Cl. 2A1, 6%, 6/1/36		1,058,425			1,030,217
JPMorgan Alternative Loan Trust 2006-S4, Mtg. Pass-Through Certificates, Series 2006-S4, Cl. A6, 5.71%, 12/1/36		306,665			263,580
LB-UBS Commercial Mortgage Trust 2007-C7, Commercial Mtg. Pass-Through Certificates, Series 2007-C7, Cl. AM, 6.005%, 9/11/453		10,430,000			9,857,982
Merrill Lynch Mortgage Investors Trust 2006-3, Mtg. Pass-Through Certificates, Series MLCC 2006-3, Cl. 2A1, 2.375%, 10/25/363		1,672,181			1,508,881
RALI Series 2006-QS13 Trust, Mtg. Asset-Backed Pass-Through Certificates:
Series 2006-QS13, Cl. 1A5, 6%, 9/25/36		1,915,553			1,087,473
Series 2006-QS13, Cl. 1A8, 6%, 9/25/36		38,289			21,737

13 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
Residential Continued
RALI Series 2007-QS6 Trust, Mtg. Asset-Backed Pass-Through Certificates, Series 2007-QS6, Cl. A28, 5.75%, 4/25/37	$	927,888		$	544,107
Residential Asset Securitization Trust 2005-A14, Mtg. Pass-Through Certificates, Series 2005-A14, Cl. A1, 5.50%, 12/1/35		3,492,413			2,832,202
Residential Asset Securitization Trust 2005-A15, Mtg. Pass-Through Certificates, Series 2005-A15, Cl. 1A4, 5.75%, 2/1/36		4,067,603			3,153,157
Residential Asset Securitization Trust 2005-A6CB, Mtg. Pass-Through Certificates, Series 2005-A6CB, Cl. A7, 6%, 6/1/35		4,566,771			3,761,538
WaMu Mortgage Pass-Through Certificates 2005-AR12 Trust, Mtg. Pass-Through Certificates, Series 2007-AR12, Cl. 1A8, 2.482%, 10/1/353		2,412,270			1,918,017
WaMu Mortgage Pass-Through Certificates 2006-AR10 Trust, Mtg. Pass-Through Certificates, Series 2006-AR10, Cl. 1A2, 5.836%, 9/1/363		1,045,369			704,859
WaMu Mortgage Pass-Through Certificates 2007-HY1 Trust, Mtg. Pass-Through Certificates:
Series 2007-HY1, Cl. 4A1, 2.61%, 2/1/373		13,787,040			9,166,314
Series 2007-HY1, Cl. 5A1, 5.183%, 2/1/373		8,403,903			6,051,650
WaMu Mortgage Pass-Through Certificates 2007-HY5 Trust, Mtg. Pass-Through Certificates, Series 2007-HY5, Cl. 3A1, 5.467%, 5/1/373		1,102,192			920,384
Wells Fargo Mortgage-Backed Securities 2005-9 Trust, Mtg. Pass-Through Certificates, Series 2005-9, Cl. 2A6, 5.25%, 10/25/35		415,798			399,947
Wells Fargo Mortgage-Backed Securities 2006-AR14 Trust, Mtg. Pass-Through Certificates, Series 2006-AR14, Cl. 1A2, 5.667%, 10/1/363		3,539,868			2,974,976
					90,010,399
Total Mortgage-Backed Obligations (Cost $474,215,861)					448,645,794
U.S. Government Obligations—8.0%
Federal Home Loan Mortgage Corp. Nts.:
1.125%, 7/27/12		17,545,000			17,636,866
2.50%, 5/27/16		1,000,000			1,060,625
5%, 2/16/17		6,500,000			7,684,599
5.125%, 11/17/17		4,000,000			4,825,116
Federal National Mortgage Assn. Nts.:
1.125%, 7/30/12		16,180,000			16,269,233
2.375%, 4/11/16		1,000,000			1,058,061
4.375%, 10/15/15		4,000,000			4,524,880
4.875%, 12/15/16		488,000			575,702
5.375%, 6/12/17		6,991,000			8,460,998
U.S. Treasury Bills:
0.038%, 6/14/12		55,000,000			54,988,780
0.035%, 3/8/1211,12		25,000,000			24,999,325
U.S. Treasury Bonds, STRIPS, 4.833%, 2/15/1612,13		2,116,000			2,056,718
U.S. Treasury Nts.:
0.875%, 11/30/1612		23,000,000			23,077,280
2%, 11/15/2111,12		13,000,000			13,144,222
Total U.S. Government Obligations (Cost $177,740,230)					180,362,405
Foreign Government Obligations—20.8%
Argentina—0.5%
Argentina (Republic of) Bonds:
2.50%, 12/31/383		4,255,000			1,510,525
7%, 10/3/15		6,370,000			5,863,259
Argentina (Republic of) Sr. Unsec. Bonds, Series X, 7%, 4/17/17		3,870,000			3,253,165
Provincia de Buenos Aires Sr. Unsec. Unsub. Nts., 10.875%, 1/26/214		1,605,000			1,223,813
					11,850,762
Australia—0.3%
New South Wales, Treasury Corp., Series 22, 6%, 3/1/22	460,000		AUD		520,139
Queensland Treasury Corp.:
Series 20, 6.25%, 2/21/20	2,210,000		AUD		2,448,457
Series 22, 6%, 7/21/22	1,300,000		AUD		1,413,769
Series 24, 5.75%, 7/22/24	790,000		AUD		838,389
Victoria Treasury Corp., Series 1224, 5.50%, 12/17/24	1,330,000		AUD		1,448,692
					6,669,446
Austria—0.1%
Austria (Republic of) Bonds, 4.35%, 3/15/194	1,135,000		EUR		1,621,513
Austria (Republic of) Sr. Unsec. Unsub. Nts., Series 1, 3.50%, 9/15/214	880,000		EUR		1,198,539
					2,820,052

14 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Belgium—0.2%
Belgium (Kingdom of) Bonds, Series 52, 4%, 3/28/18	1,770,000		EUR		$	2,352,120
Belgium (Kingdom of) Sr. Bonds, Series 40, 5.50%, 9/28/17	175,000		EUR			247,994
Belgium (Kingdom of) Treasury Bills, 0.543%, 1/19/1213	995,000		EUR			1,288,169
						3,888,283
Brazil—2.5%
Brazil (Federative Republic of) Nota Do Tesouro Nacional Nts.:
9.762%, 1/1/17	47,838,000		BRR			24,639,039
9.762%, 1/1/21	33,538,000		BRR			16,727,196
12.322%, 5/15/4514	6,470,000		BRR			7,885,405
Series NTNB, 12.322%, 5/15/1514	6,025,000		BRR			6,997,754
						56,249,394
Canada—0.1%
Canada (Government of) Nts.:
3.75%, 6/1/19	1,420,000		CAD			1,595,292
4%, 6/1/17	1,230,000		CAD			1,372,010
						2,967,302
Colombia—0.5%
Bogota Distrio Capital Sr. Bonds, 9.75%, 7/26/284	3,058,000,000		COP			2,170,652
Colombia (Republic of) Bonds:
4.375%, 7/12/21		2,165,000				2,338,200
7.375%, 9/18/37		745,000				1,052,313
Colombia (Republic of) Sr. Unsec. Bonds, 6.125%, 1/18/41		4,205,000				5,214,200
						10,775,365
Denmark—0.0%
Denmark (Kingdom of) Bonds, 4%, 11/15/19	4,275,000		DKK			891,607
Dominican Republic—0.1%
Dominican Republic Bonds, 7.50%, 5/6/214		1,880,000				1,856,500
Finland—0.0%
Finland (Republic of) Sr. Unsec. Unsub. Nts., 3.875%, 9/15/17	425,000		EUR			612,819
France—0.2%
France (Republic of) Bonds:
3.25%, 10/25/21	1,255,000		EUR			1,635,127
3.75% 10/25/19	750,000		EUR			1,034,537
4%, 4/25/60	395,000		EUR			540,730
4.50%, 4/25/41	845,000		EUR			1,253,329
						4,463,723
Germany—0.2%
Germany (Federal Republic of) Bonds:
2.50%, 1/4/21	700,000		EUR			967,335
3.50%, 7/4/19	1,270,000		EUR			1,880,522
Series 157, 2.25%, 4/10/15	1,995,000		EUR			2,733,505
						5,581,362
Ghana—0.1%
Ghana (Republic of) Bonds, 8.50%, 10/4/174		1,505,000				1,655,500
Greece—0.0%
Hellenic Republic Sr. Unsec. Unsub. Bonds, 30 yr., 4.50%, 9/20/37	2,600,000		EUR			693,199
Hungary—0.8%
Hungary (Republic of) Bonds:
Series 12/B, 7.25%, 6/12/12	525,000,000		HUF			2,141,981
Series 19/A, 6.50%, 6/24/19	647,000,000		HUF			2,196,738
Series 20/A, 7.50%, 11/12/20	820,000,000		HUF			2,917,983
Hungary (Republic of) Sr. Unsec. Bonds:
4.50%, 1/29/14	2,120,000		EUR			2,507,014
7.625%, 3/29/41		1,500,000				1,335,000
Hungary (Republic of) Sr. Unsec. Nts., 5.75%, 6/11/18	1,695,000		EUR			1,849,111
Hungary (Republic of) Sr. Unsec. Unsub. Nts., 6.375%, 3/29/21		4,230,000				3,807,000
Hungary (Republic of) Treasury Bills, 6.103%, 1/11/1213	58,000,000		HUF			238,193
						16,993,020
Indonesia—0.8%
Indonesia (Republic of) Nts., 6.875%, 1/17/184		4,960,000				5,865,200
Indonesia (Republic of) Sr. Unsec. Bonds, 4.875%, 5/5/214		870,000				935,250
Indonesia (Republic of) Sr. Unsec. Nts., 7.75%, 1/17/384		4,395,000				5,977,200
Indonesia (Republic of) Sr. Unsec. Unsub. Bonds, 6.625% 2/17/374		1,340,000				1,634,800
Indonesia (Republic of) Unsec. Nts., 8.50%, 10/12/354		2,360,000				3,422,000
						17,834,450
Israel—0.1%
Israel (State of) Bonds:
Series 0312, 4%, 3/30/12	2,895,000		ILS			762,426
Series 0313, 5%, 3/31/13	1,930,000		ILS			520,927
						1,283,353
Italy—0.5%
Italy (Republic of) Bonds:
3.142%, 9/15/2614	1,185,000		EUR			1,203,040
4%, 9/1/20	1,185,000		EUR			1,285,117

15 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
Italy Continued
Italy (Republic of) Bonds: Continued
4.75%, 1/25/16	$	845,000		$	787,779
5%, 9/1/40	865,000		EUR		892,070
5.375%, 6/12/17		425,000			394,040
Series EU, 2.575%, 10/15/173	845,000		EUR		841,083
Italy (Republic of) Nts., 4.22%, 3/1/143	195,000		EUR		234,331
Italy (Republic of) Sr. Unsec. Bonds, 2.839%, 9/15/2314	2,195,000		EUR		2,359,287
Italy (Republic of) Treasury Bonds, 4.75%, 9/1/21	2,080,000		EUR		2,340,454
					10,337,201
Ivory Coast—0.0%
Ivory Coast (Republic of) Sr. Unsec. Bonds, 2.50%, 12/31/324,5		415,000			209,575
Japan—2.0%
Japan Bonds, 20 yr., Series 112, 2.10%, 6/20/29	1,028,000,000		JPY		14,282,883
Japan Sr. Unsec. Unsub. Bonds:
2 yr., Series 304, 0.20%, 5/15/13	448,000,000		JPY		5,826,567
5 yr., Series 96, 0.50%, 3/20/16	1,268,000,000		JPY		16,613,057
10 yr., Series 307, 1.30%, 3/20/20	652,000,000		JPY		8,839,356
					45,561,863
Korea, Republic of South—0.1%
Korea (Republic of) Sr. Unsec. Treasury Bonds:
Series 1406, 3.50%, 6/10/14	1,201,000,000		KRW		1,047,539
Series 1603, 4%, 3/10/16	1,484,000,000		KRW		1,317,447
					2,364,986
Malaysia—0.4%
Malaysia (Government of) Sr. Unsec. Bonds:
Series 1/06, 4.262%, 9/15/16	1,710,000		MYR		561,642
Series 0309, 2.711%, 2/14/12	20,900,000		MYR		6,591,062
Wakala Global Sukuk Bhd Bonds, 4.646%, 7/6/214,8		2,160,000			2,285,973
					9,438,677
Mexico—2.1%
United Mexican States Bonds:
5.625%, 1/15/17		1,340,000			1,547,700
Series M, 6.50%, 6/10/213	214,660,000		MXN		15,437,224
Series M20, 7.50%, 6/3/273	201,220,000		MXN		14,941,227
Series M10, 7.75%, 12/14/17	10,850,000		MXN		853,953
Series M10, 8%, 12/17/15	44,000,000		MXN		3,443,387
Series M20, 8.50%, 5/31/293	8,960,000		MXN		712,784
Series MI10, 9%, 12/20/123	30,300,000		MXN		2,261,892
Series M20, 10%, 12/5/243	79,220,000		MXN		7,316,526
United Mexican States Nts., 6.75%, 9/27/34		630,000			823,725
					47,338,418
Panama—0.3%
Panama (Republic of) Bonds:
7.25%, 3/15/15		1,270,000			1,470,025
8.875%, 9/30/27		950,000			1,429,750
9.375%, 4/1/29		960,000			1,531,200
Panama (Republic of) Unsec. Bonds, 7.125%, 1/29/26		1,115,000			1,457,863
					5,888,838
Peru—0.4%
Peru (Republic of) Sr. Unsec. Nts., 7.84%, 8/12/204	20,980,000		PEN		8,890,727
Peru (Republic of) Sr. Unsec. Unsub. Bonds, 5.625%, 11/18/50		410,000			453,050
					9,343,777
Philippines—0.1%
Philippines (Republic of the) Sr. Unsec. Unsub. Bonds, 6.375%, 10/23/34		1,120,000			1,342,600
Poland—1.4%
Poland (Republic of) Bonds:
5.25%, 10/25/20	14,100,000		PLZ		3,924,260
Series 0415, 5.50%, 4/25/15	1,680,000		PLZ		494,152
Series 0416, 5%, 4/25/16	53,215,000		PLZ		15,374,105
Series 1015, 6.25%, 10/24/15	16,725,000		PLZ		5,035,094
Series 1017, 5.25%, 10/25/17	905,000		PLZ		259,612
Poland (Republic of) Sr. Unsec. Nts.:
5%, 3/23/22		1,710,000			1,724,963
5.125%, 4/21/21		2,480,000			2,529,600
6.375%, 7/15/19		1,275,000			1,415,250
					30,757,036
Qatar—0.2%
Qatar (State of) Sr. Nts., 5.25%, 1/20/204		1,645,000			1,813,613
Qatar (State of) Sr. Unsec. Nts.:
5.75%, 1/20/424		1,270,000			1,374,775
6.40%, 1/20/404		750,000			885,000
					4,073,388
Russia—0.1%
Russian Federation Bonds, 5%, 4/29/204		1,290,000			1,334,054
Singapore—0.0%
Singapore (Republic of) Sr. Unsec. Bonds, 2.375%, 4/1/17	520,000		SGD		432,736
South Africa—2.2%
South Africa (Republic of) Bonds:
5.50%, 3/9/20		1,865,000			2,098,125
Series R209, 6.25%, 3/31/36	57,350,000		ZAR		5,257,199
Series R208, 6.75%, 3/31/21	73,570,000		ZAR		8,417,522
Series R213, 7%, 2/28/31	68,375,000		ZAR		7,014,905
Series R207, 7.25%, 1/15/20	115,470,000		ZAR		13,773,794
Series R186, 10.50%, 12/21/26	85,840,000		ZAR		12,448,834
					49,010,379

16 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Spain—0.2%
Spain (Kingdom of) Bonds, 4.25%, 10/31/16	865,000		EUR	$	1,123,767
Spain (Kingdom of) Treasury Bills, 2.991%, 2/17/1213	2,105,000		EUR		2,720,167
					3,843,934
Sri Lanka—0.1%
Sri Lanka (Democratic Socialist Republic of) Sr. Unsec. Nts.:
6.25%, 10/4/204		1,480,000			1,487,400
6.25% 7/27/214		1,850,000			1,826,161
					3,313,561
The Netherlands—0.1%
Netherlands (Kingdom of the) Bonds:
4%, 7/15/18	600,000		EUR		880,520
4%, 7/15/19	1,025,000		EUR		1,518,917
					2,399,437
Turkey—2.0%
Turkey (Republic of) Bonds:
6.875%, 3/17/36		3,065,000			3,210,588
7%, 3/11/19		1,430,000			1,590,875
8.68%, 2/20/1313	17,180,000		TRY		8,054,075
9.964%, 7/17/1313	31,595,000		TRY		14,100,504
9.999%, 4/25/1213	13,320,000		TRY		6,808,860
10.50%, 1/15/203	1,120,000		TRY		610,936
11%, 8/6/14	6,590,000		TRY		3,519,886
14.689%, 8/14/133,14	2,200,000		TRY		1,698,910
Turkey (Republic of) Nts., 7.50%, 7/14/17		1,840,000			2,079,200
Turkey (Republic of) Unsec. Nts.:
5.125%, 3/25/22		1,345,000			1,287,838
6%, 1/14/41		2,710,000			2,567,725
					45,529,397
Ukraine—0.4%
City of Kyiv Via Kyiv Finance plc Sr. Unsec. Bonds, 9.375%, 7/11/164		985,000			773,225
Financing of Infrastructural Projects State Enterprise Gtd. Nts., 8.375%, 11/3/174		2,240,000			1,881,600
Ukraine (Republic of) Bonds, 7.75%, 9/23/204,8		2,180,000			1,896,600
Ukraine (Republic of) Sr. Unsec. Nts.:
6.25%, 6/17/164		2,720,000			2,400,400
6.75%, 11/14/174		2,160,000			1,868,400
7.95%, 2/23/214		1,555,000			1,372,288
					10,192,513
United Kingdom—0.5%
United Kingdom Treasury Bonds:
4%, 9/7/16	1,400,000		GBP		2,486,715
4.25%, 3/7/36	1,940,000		GBP		3,699,970
4.75%, 3/7/20	1,000,000		GBP		1,920,987
4.75%, 12/7/38	1,735,000		GBP		3,601,176
					11,708,848
Uruguay—0.4%
Uruguay (Oriental Republic of) Bonds, 7.625%, 3/21/36		2,875,000			4,003,438
Uruguay (Oriental Republic of) Sr. Nts., 6.875%, 9/28/25		855,000			1,111,500
Uruguay (Oriental Republic of) Unsec. Bonds, 8%, 11/18/22		2,491,250			3,425,469
					8,540,407
Venezuela—0.8%
Venezuela (Republic of) Bonds:
9%, 5/7/23		4,535,000			3,265,200
11.95%, 8/5/31		2,555,000			2,101,488
Venezuela (Republic of) Nts., 8.25%, 10/13/24		910,000			602,875
Venezuela (Republic of) Sr. Unsec. Unsub. Nts.:
7.75%, 10/13/19		1,960,000			1,411,200
12.75%, 8/23/22		440,000			399,300
Venezuela (Republic of) Unsec. Bonds:
7%, 3/31/38		3,920,000			2,283,400
7.65%, 4/21/25		4,500,000			2,812,500
Venezuela (Republic of) Unsec. Nts., 13.625%, 8/15/184		5,465,000			5,150,763
					18,026,726
Total Foreign Government Obligations (Cost $483,045,582)					468,074,488
Loan Participations—0.9%
Brock Holdings III, Inc., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 10%, 2/15/183		620,000			571,175
Clear Channel Communications, Inc., Sr. Sec. Credit Facilities 1st Lien Term Loan:
Tranche B, 3.91%, 1/29/163		3,085,000			2,288,898
Tranche B, 3.91%, 1/29/163,8		585,000			434,037
Entegra Holdings LLC, Sr. Sec. Credit Facilities 3rd Lien Term Loan, Tranche B, 3.855%, 10/19/153,15		9,511,261			5,667,123
Nuveen Investments, Inc., Sr. Sec. Credit Facilities 2nd Lien Term Loan, 12.50%, 7/31/15		3,186,875			3,307,712

17 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Loan Participations Continued
OneLink Communications/San Juan Cable LLC, Sr. Sec. Credit Facilities 2nd Lien Term Loan, Tranche B, 10%, 10/31/133,8	$	1,055,000	$	1,028,625
Realogy Corp., Extended Sr. Sec. Credit Facilities 1st Lien Term Loan:
Tranche B, 4%, 10/10/163,8		222,461		199,619
Tranche B, 4.522%, 10/10/163,8		2,821,702		2,531,972
Revel Entertainment LLC, Sr. Sec. Credit Facilities 1st Lien Term Loan, 7.50%, 2/17/173,8		1,045,000		958,788
Samson Investment Co., Sr. Sec. Credit Facilities Bridge Loan, 6.50%, 12/20/123,8		3,890,000		3,890,000
Total Loan Participations (Cost $21,142,146)				20,877,949
Corporate Bonds and Notes—25.9%
Consumer Discretionary—3.3%
Auto Components—0.4%
Goodyear Tire & Rubber Co. (The), 8.25% Sr. Unsec. Unsub. Nts., 8/15/20		2,190,000		2,398,050
Tower Automotive Holdings USA LLC/TA Holdings Finance, Inc., 10.625% Sr. Sec. Nts., 9/1/174		4,762,000		4,809,620
Visteon Corp., 6.75% Sr. Nts., 4/15/194		2,470,000		2,476,175
				9,683,845
Automobiles—0.0%
Jaguar Land Rover plc, 7.75% Sr. Unsec. Bonds, 5/15/184,8		390,000		373,425
Hotels, Restaurants & Leisure—1.2%
Equinox Holdings, Inc., 9.50% Sr. Sec. Nts., 2/1/164		1,780,000		1,837,850
Grupo Posadas SAB de CV, 9.25% Sr. Unsec. Nts., 1/15/154		1,285,000		1,079,400
Harrah’s Operating Co., Inc., 10% Sr. Sec. Nts., 12/15/18		10,027,000		6,918,630
HOA Restaurants Group LLC/HOA Finance Corp., 11.25% Sr. Sec. Nts., 4/1/174		2,635,000		2,470,313
Isle of Capri Casinos, Inc.:
7% Sr. Unsec. Sub. Nts., 3/1/14		1,420,000		1,334,800
7.75% Sr. Unsec. Unsub. Nts., 3/15/19		2,030,000		1,867,600
Landry’s Restaurants, Inc., 11.625% Sr. Sec. Nts., 12/1/15		2,500,000		2,643,750
MGM Mirage, Inc., 6.625% Sr. Unsec. Nts., 7/15/15		3,890,000		3,714,950
Mohegan Tribal Gaming Authority, 8% Sr. Sub. Nts., 4/1/12		2,920,000		1,971,000
Penn National Gaming, Inc., 8.75% Sr. Unsec. Sub. Nts., 8/15/19		1,550,000		1,693,375
Premier Cruise Ltd., 11% Sr. Nts., 3/15/085,6		250,000		—
Travelport LLC, 11.875% Sr. Unsec. Sub. Nts., 9/1/16		1,885,000		556,075
				26,087,743
Household Durables—0.2%
Beazer Homes USA, Inc.:
6.875% Sr. Unsec. Nts., 7/15/15		995,000		748,738
9.125% Sr. Unsec. Nts., 5/15/19		2,825,000		1,942,188
Reynolds Group Issuer, Inc./Reynolds Group Issuer LLC/Reynolds Group Issuer Luxembourg SA:
9% Sr. Nts., 4/15/194		1,635,000		1,561,425
9% Sr. Nts., 5/15/184		995,000		957,688
				5,210,039
Media—1.4%
Affinion Group Holdings, Inc., 11.625% Sr. Unsec. Nts., 11/15/15		1,140,000		951,900
Affinion Group, Inc., 7.875% Sr. Unsec. Nts., 12/15/18		3,055,000		2,596,750
Belo (A.H.) Corp., 7.75% Sr. Unsec. Unsub. Debs., 6/1/27		2,983,000		2,602,668
Cengage Learning Acquisitions, Inc., 10.50% Sr. Nts., 1/15/154		3,225,000		2,330,063
Cequel Communications Holdings I LLC, 8.625% Sr. Unsec. Nts., 11/15/174		2,350,000		2,502,750
Clear Channel Communications, Inc., 5.75% Sr. Unsec. Unsub. Nts., 1/15/13		3,010,000		2,874,550
Cumulus Media, Inc., 7.75% Sr. Nts., 5/1/194		1,230,000		1,097,775
Entravision Communications Corp., 8.75% Sr. Sec. Nts., 8/1/17		1,905,000		1,876,425
Gray Television, Inc., 10.50% Sr. Sec. Nts., 6/29/15		3,510,000		3,334,500
Interactive Data Corp., 10.25% Sr. Unsec. Nts., 8/1/18		965,000		1,056,675
Kabel BW Erste Beteiligungs GmbH/Kabel Baden-Wurttemberg GmbH & Co. KG, 7.50% Sr. Sec. Nts., 3/15/194		1,595,000		1,682,725
Newport Television LLC/NTV Finance Corp., 12.719% Sr. Nts., 3/15/174,15		2,120,261		1,902,934

18 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Media Continued
Nexstar Broadcasting, Inc./Mission Broadcasting, Inc., 8.875% Sec. Nts., 4/15/17	$	1,850,000		$	1,905,500
Sinclair Television Group, Inc., 8.375% Sr. Unsec. Nts., 10/15/18		2,505,000			2,598,938
Univision Communications, Inc., 7.875% Sr. Sec. Nts., 11/1/204		695,000			708,900
UPCB Finance V Ltd., 7.25% Sr. Sec. Nts., 11/15/214		1,225,000			1,246,438
Visant Corp., 10% Sr. Unsec. Nts., 10/1/17		1,135,000			1,044,200
					32,313,691
Specialty Retail—0.0%
Michaels Stores, Inc., 7.75% Sr. Unsec. Nts., 11/1/18		155,000			157,325
Textiles, Apparel & Luxury Goods—0.1%
Jones Group, Inc. (The)/Jones Apparel Group Holdings, Inc./ Jones Apparel Group USA, Inc./ JAG Footwear, Accessories & Retail Corp., 6.875% Sr. Unsec. Unsub. Nts., 3/15/19		1,595,000			1,443,475
Consumer Staples—0.7%
Beverages—0.1%
AmBev International Finance Co. Ltd., 9.50% Sr. Unsec. Unsub. Nts., 7/24/173		2,080,000	BRR		1,176,793
Food & Staples Retailing—0.1%
Cencosud SA, 5.50% Sr. Unsec. Nts., 1/20/214		2,155,000			2,207,530
Food Products—0.5%
American Seafoods Group LLC, 10.75% Sr. Sub. Nts., 5/15/164		2,150,000			1,924,250
ASG Consolidated LLC, 15% Sr. Nts., 5/15/174,15		5,015,747			3,887,204
Bumble Bee Acquisition Corp., 9% Sr. Sec. Nts., 12/15/174		2,162,000			2,205,240
MHP SA, 10.25% Sr. Unsec. Nts., 4/29/154		2,008,000			1,787,120
Southern States Cooperative, Inc., 11.25% Sr. Nts., 5/15/156		2,465,000			2,600,575
					12,404,389
Household Products—0.0%
Spectrum Brands Holdings, Inc., 9.50% Sr. Sec. Nts., 6/15/18		870,000			955,913
Energy—4.7%
Energy Equipment & Services—0.4%
Forbes Energy Services Ltd., 9% Sr. Unsec. Nts., 6/15/19		1,695,000			1,593,300
Global Geophysical Services, Inc., 10.50% Sr. Unsec. Nts., 5/1/17		2,200,000			2,079,000
Offshore Group Investments Ltd., 11.50% Sr. Sec. Nts., 8/1/15		3,105,000			3,372,806
Precision Drilling Corp., 6.625% Sr. Unsec. Nts., 11/15/20		2,420,000			2,486,550
					9,531,656
Oil, Gas & Consumable Fuels—4.3%
Afren plc, 11.50% Sr. Sec. Nts., 2/1/164		1,705,000			1,687,950
Alliance Oil Co. Ltd., 9.875% Sr. Unsec. Nts., 3/11/154		1,500,000			1,533,750
Antero Resources Finance Corp., 9.375% Sr. Unsec. Nts., 12/1/17		2,955,000			3,206,175
Arch Coal, Inc., 7% Sr. Unsec. Nts., 6/15/194		390,000			399,750
Atlas Pipeline Partners LP/Atlas Pipeline Finance Corp., 8.75% Sr. Unsec. Nts., 6/15/184		1,535,000			1,611,750
ATP Oil & Gas Corp., 11.875% Sr. Sec. Nts., 5/1/15		2,760,000			1,828,500
Bill Barrett Corp., 7.625% Sr. Unsec. Unsub. Nts., 10/1/19		780,000			819,000
Breitburn Energy Partners LP/Breitburn Finance Corp., 8.625% Sr. Unsec. Nts., 10/15/20		2,805,000			2,948,756
Chaparral Energy, Inc., 9.875% Sr. Unsec. Nts., 10/1/20		1,760,000			1,909,600
Cloud Peak Energy Resources LLC/Cloud Peak Energy Finance Corp., 8.50% Sr. Unsec. Unsub. Nts., 12/15/19		390,000			423,150
Empresa Nacional del Petroleo, 5.25% Unsec. Nts., 8/10/204		865,000			916,517
Gaz Capital SA:
7.288% Sr. Sec. Nts., 8/16/374		5,225,000			5,414,406
8.146% Sr. Sec. Nts., 4/11/184		2,680,000			3,028,400
8.625% Sr. Sec. Nts., 4/28/344		1,680,000			1,986,600
9.25% Sr. Unsec. Unsub. Nts., 4/23/194		3,655,000			4,363,705
James River Coal Co., 7.875% Sr. Unsec. Unsub. Nts., 4/1/19		640,000			486,400
KazMunayGaz National Co., 6.375% Sr. Unsec. Bonds, 4/9/214		1,600,000			1,628,000

19 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Oil, Gas & Consumable Fuels Continued
KMG Finance Sub BV:
7% Sr. Unsec. Bonds, 5/5/204	$	1,150,000	$	1,220,438
9.125% Sr. Unsec. Unsub. Nts., 7/2/184		3,885,000		4,545,450
Linn Energy LLC/Linn Energy Finance Corp., 8.625% Sr. Unsec. Nts., 4/15/20		3,620,000		3,945,800
Lukoil International Finance BV:
6.125% Sr. Unsec. Nts., 11/9/204		3,860,000		3,802,100
6.656% Sr. Unsec. Unsub. Bonds, 6/7/224		780,000		781,950
7.25% Sr. Unsec. Unsub. Nts., 11/5/194		595,000		617,313
MEG Energy Corp., 6.50% Sr. Unsec. Nts., 3/15/214		3,195,000		3,282,863
Murray Energy Corp., 10.25% Sr. Sec. Nts., 10/15/154		3,100,000		3,092,250
Nak Naftogaz Ukraine, 9.50% Unsec. Nts., 9/30/14		2,660,000		2,507,050
Navios Maritime Acquisition Corp., 8.625% Sr. Sec. Nts., 11/1/17		695,000		507,350
Odebrecht Drilling Norbe VIII/IX Ltd., 6.35% Sr. Sec. Nts., 6/30/214		1,290,000		1,335,150
Pemex Project Funding Master Trust:
6.625% Sr. Unsec. Unsub. Nts., 6/15/38		830,000		948,275
6.625% Unsec. Unsub. Bonds, 6/15/35		4,225,000		4,832,344
Pertamina PT (Persero):
5.25% Nts., 5/23/214		2,420,000		2,501,070
6.50% Sr. Unsec. Nts., 5/27/414		1,075,000		1,123,375
Petrobras International Finance Co., 5.75% Sr. Unsec. Unsub. Nts., 1/20/20		1,280,000		1,375,711
Petroleos de Venezuela SA:
4.90% Sr. Unsec. Nts., Series 2014, 10/28/14		2,795,000		2,194,075
8.50% Sr. Nts., 11/2/174		3,565,000		2,696,923
12.75% Sr. Unsec. Nts., 2/17/224		2,540,000		2,133,600
Petroleos Mexicanos:
5.50% Sr. Unsec. Unsub. Nts., 1/21/21		1,690,000		1,842,100
6% Sr. Unsec. Unsub. Nts., 3/5/20		2,050,000		2,286,365
Petroleum Co. of Trinidad & Tobago Ltd., 9.75% Sr. Unsec. Nts., 8/14/194		2,465,000		2,933,350
PT Adaro Indonesia, 7.625% Nts., 10/22/194		2,000,000		2,192,600
Quicksilver Resources, Inc.:
8.25% Sr. Unsec. Nts., 8/1/15		170,000		176,800
11.75% Sr. Nts., 1/1/16		2,125,000		2,422,500
Range Resources Corp., 8% Sr. Unsec. Sub. Nts., 5/15/19		1,230,000		1,377,600
SandRidge Energy, Inc.:
8.75% Sr. Unsec. Nts., 1/15/20		2,925,000		3,034,688
9.875% Sr. Unsec. Nts., 5/15/164		1,290,000		1,386,750
Tengizchevroil LLP, 6.124% Nts., 11/15/144		801,542		824,586
Venoco, Inc., 8.875% Sr. Unsec. Nts., 2/15/19		1,375,000		1,244,375
				97,357,210
Financials—4.9%
Capital Markets—0.9%
Berry Plastics Holding Corp., 10.25% Sr. Unsec. Sub. Nts., 3/1/16		900,000		873,000
Credit Suisse First Boston International, 6.80% Export-Import Bank of Ukraine Nts., 10/4/12		830,000		825,850
Edgen Murray Corp., 12.25% Sr. Sec. Nts., 1/15/15		1,420,000		1,285,100
Korea Development Bank (The), 3.875% Sr. Unsec. Nts., 5/4/178		1,285,000		1,272,433
Nationstar Mortgage/Nationstar Capital Corp., 10.875% Sr. Unsec. Nts., 4/1/15		5,340,000		5,313,300
Nuveen Investments, Inc.:
5.50% Sr. Unsec. Nts., 9/15/15		1,095,000		925,275
10.50% Sr. Unsec. Unsub. Nts., 11/15/15		1,960,000		1,955,100
Pinafore LLC/Pinafore, Inc., 9% Sec. Nts., 10/1/18		2,646,000		2,946,983
Springleaf Finance Corp., 6.90% Nts., Series J, 12/15/17		2,185,000		1,584,125
Verso Paper Holdings LLC, 11.375% Sr. Unsec. Sub. Nts., Series B, 8/1/16		5,310,000		2,203,650
Verso Paper Holdings LLC/Verso Paper, Inc., 8.75% Sr. Sec. Nts., 2/1/19		2,495,000		1,534,425
				20,719,241
Commercial Banks—2.4%
Akbank TAS, 5.125% Sr. Unsec. Nts., 7/22/154		2,130,000		2,087,400
Alfa Bank/Alfa Bond Issuance plc, 7.875% Nts., 9/25/174		1,570,000		1,499,350
Australia & New Zealand Banking Group Ltd., 2.40% Sec. Bonds, 11/23/164		480,000		476,121
Banco BMG SA:
9.15% Nts., 1/15/164		2,660,000		2,540,300
9.95% Unsec. Unsub. Nts., 11/5/194		1,120,000		1,047,200

20 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Commercial Banks Continued
Banco de Credito del Peru:
5.375% Sr. Nts., 9/16/204	$	480,000		$	473,184
9.75% Jr. Sub. Nts., 11/6/694		800,000			912,000
Banco de Credito del Peru/Panama, 6.875% Sub. Nts., 9/16/263,4		1,628,000			1,680,910
Banco Do Brasil SA:
5.875% Unsec. Sub. Nts., 1/26/224		825,000			834,075
8.50% Jr. Sub. Perpetual Bonds4,16		1,125,000			1,316,250
Banco PanAmericano SA, 8.50% Sr. Unsec. Sub. Nts., 4/23/204		1,160,000			1,229,600
Banco Votorantim SA, 5.25% Sr. Unsec. Unsub. Nts., 2/11/164		850,000			863,600
Bancolombia SA, 4.25% Sr. Unsec. Unsub. Nts., 1/12/16		1,740,000			1,731,300
Bank of Scotland plc:
4.375% Sr. Sec. Nts., 7/13/16		2,050,000	EUR		2,774,169
4.50% Sr. Sec. Nts., 7/13/21		1,404,000	EUR		1,870,079
4.875% Sr. Sec. Nts., 12/20/24		160,000	GBP		258,046
BOM Capital plc, 6.699% Sr. Unsec. Nts., 3/11/154		3,740,000			3,721,300
BPCE SFH SA, 3.75% Sr. Sec. Nts., 9/13/21		440,000	EUR		563,838
CIT Group, Inc., 7% Sec. Bonds, 5/2/174		1,625,000			1,625,000
Halyk Savings Bank of Kazakhstan JSC:
7.25% Unsec. Unsub. Nts., 5/3/174		430,000			417,100
9.25% Sr. Nts., 10/16/134		8,420,000			8,883,100
ICICI Bank Ltd.:
5.50% Sr. Unsec. Nts., 3/25/154,8		3,090,000			3,093,507
6.375% Bonds, 4/30/223,4		3,060,000			2,708,100
Lloyds TSB Bank plc:
4.875% Sec. Nts., 1/13/23		170,000	EUR		232,993
6% Sr. Sec. Nts., 2/8/29	190,000		GBP		331,033
Privatbank CJSC/UK SPV Credit Finance plc, 8% Sr. Sec. Nts., 2/6/124		1,240,000			1,223,731
Sberbank of Russia Via SB Capital SA, 5.40% Sr. Unsec. Nts., 3/24/17		2,570,000			2,570,000
Turkiye Is Bankasi (Isbank), 5.10% Sr. Unsec. Nts., 2/1/164		1,290,000			1,254,525
VEB Finance Ltd., 6.902% Sr. Unsec. Unsub. Nts., 7/9/204		3,590,000			3,697,700
VTB Capital SA:
6.315% Nts., 2/22/184		1,250,000			1,188,375
6.465% Sr. Sec. Unsub. Nts., 3/4/154		800,000			810,000
Westpac Banking Corp., 2.45% Sr. Sec. Bonds, 11/28/164		480,000			476,527
					54,390,413
Consumer Finance—0.2%
JSC Astana Finance, 9.16% Nts., 3/14/125		7,200,000			792,000
Speedy Cash, Inc., 10.75% Sr. Sec. Nts., 10/15/184	$	1,540,000		$	1,555,400
TMX Finance LLC/TitleMax Finance Corp., 13.25% Sr. Sec. Nts., 7/15/15		1,925,000			2,127,125
					4,474,525
Diversified Financial Services—0.5%
Autopistas del Nordeste Cayman Ltd., 9.39% Nts., 1/15/264		2,809,723			2,556,847
BA Covered Bond Issuer, 4.25% Sec. Nts., 4/5/17		825,000	EUR		1,076,830
Banco Invex SA, 30.202% Mtg.-Backed Certificates, Series 062U, 3/13/343,14		4,830,734	MXN		472,173
GMAC LLC, 8% Sr. Unsec. Nts., 11/1/31		1,260,000			1,222,200
JPMorgan Hipotecaria su Casita:
7.973% Sec. Nts., 8/26/353,6		5,808,600	MXN		466,307
28.563% Mtg.-Backed Certificates, Series 06U, 9/25/353		1,678,698	MXN		226,144
Korea Development Bank (The), 4% Sr. Unsec. Unsub. Nts., 9/9/16		1,485,000			1,512,432
Tiers-BSP, 0%/8.60% Collateralized Trust, Cl. A, 6/15/974,17		6,360,000			4,403,282
					11,936,215
Insurance—0.1%
International Lease Finance Corp., 8.75% Sr. Unsec. Unsub. Nts., 3/15/17		1,475,000			1,522,938
Real Estate Investment Trusts—0.3%
FelCor Escrow Holdings LLC, 6.75% Sr. Sec. Nts., 6/1/19		4,055,000			3,913,075
OMEGA Healthcare Investors, Inc., 6.75% Sr. Unsec. Nts., 10/15/22		2,470,000			2,494,700
					6,407,775
Real Estate Management & Development—0.2%
Ainsworth Lumber Co. Ltd., 11% Sr. Unsec. Unsub. Nts., 7/29/154,15		3,077,558			1,986,376
Realogy Corp., 11.50% Sr. Unsec. Unsub. Nts., 4/15/17		1,255,000			985,175
Wallace Theater Holdings, Inc., 12.50% Sr. Sec. Nts., 6/15/133,4		2,230,000			2,174,250
					5,145,801
Thrifts & Mortgage Finance—0.3%
Banco Hipotecario SA, 9.75% Sr. Unsec. Nts., 4/27/164		745,000			685,400
WM Covered Bond Program:
4% Sec. Mtg. Nts., Series 2, 9/27/16		3,250,000	EUR		4,413,354
4.375% Sec. Nts., 5/19/14		1,030,000	EUR		1,385,584
					6,484,338

21 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount		Value
Health Care—1.0%
Biotechnology—0.0%
Grifols, Inc., 8.25% Sr. Sec. Nts., 2/1/18	$	800,000	$	844,000
Health Care Equipment & Supplies—0.3%
Accellent, Inc., 10% Sr. Unsec. Sub. Nts., 11/1/17		2,305,000		1,878,575
Alere, Inc., 8.625% Sr. Unsec. Sub. Nts., 10/1/18		1,030,000		1,019,700
Biomet, Inc., 11.625% Sr. Unsec. Sub. Nts., 10/15/17		1,836,000		2,001,240
Inverness Medical Innovations, Inc., 7.875% Sr. Unsec. Unsub. Nts., 2/1/16		1,045,000		1,052,838
				5,952,353
Health Care Providers & Services—0.5%
Catalent Pharma Solutions, Inc., 9.50% Sr. Unsec. Nts., 4/15/1515		1,593,400		1,645,186
Gentiva Health Services, Inc., 11.50% Sr. Unsec. Unsub. Nts., 9/1/18		1,170,000		966,713
inVentiv Health, Inc., 10% Sr. Unsec. Nts., 8/15/184		1,280,000		1,177,600
Kindred Healthcare, Inc., 8.25% Sr. Unsec. Nts., 6/1/19		2,145,000		1,812,525
Multiplan, Inc., 9.875% Sr. Nts., 9/1/184		1,150,000		1,201,750
Oncure Holdings, Inc., 11.75% Sr. Sec. Nts., 5/15/17		1,130,000		898,350
Radiation Therapy Services, Inc., 9.875% Sr. Unsec. Sub. Nts., 4/15/17		1,205,000		906,763
STHI Holding Corp., 8% Sec. Nts., 3/15/184		795,000		820,838
US Oncology, Inc., Escrow Shares (related to 9.125% Sr. Sec. Nts., 8/15/17)5		1,730,000		30,275
Vanguard Health Holding Co. II LLC/Vanguard Holding Co. II, Inc., 8% Sr. Nts., 2/1/18		1,595,000		1,591,013
				11,051,013
Health Care Technology—0.0%
MedAssets, Inc., 8% Sr. Unsec. Nts., 11/15/18		305,000		300,425
Life Sciences Tools & Services—0.0%
Jaguar Holding Co./Jaguar Merger Sub, Inc., 9.50% Sr. Unsec. Nts., 12/1/194		770,000		812,350
Pharmaceuticals—0.2%
DJO Finance LLC/DJO Finance Corp., 10.875% Sr. Unsec. Nts., 11/15/14		535,000		501,563
Mylan, Inc., 6% Sr. Nts., 11/15/184		810,000		837,338
Valeant Pharmaceuticals International, Inc., 6.875% Sr. Unsec. Nts., 12/1/184		765,000		766,913
Warner Chilcott Co. LLC/Warner Chilcott Finance LLC, 7.75% Sr. Unsec. Nts., 9/15/18		2,320,000		2,380,900
				4,486,714
Industrials—2.6%
Aerospace & Defense—0.5%
BE Aerospace, Inc., 6.875% Sr. Nts., 10/1/20		840,000		919,800
DynCorp International, Inc., 10.375% Sr. Unsec. Nts., 7/1/17		4,005,000		3,504,375
Hawker Beechcraft Acquisition Co. LLC:
8.50% Sr. Unsec. Nts., 4/1/15		4,815,000		914,850
9.75% Sr. Unsec. Sub. Nts., 4/1/17		955,000		95,500
Huntington Ingalls Industries, Inc., 7.125% Sr. Unsec. Nts., 3/15/214		1,410,000		1,388,850
Kratos Defense & Security Solutions, Inc., 10% Sr. Sec. Nts., 6/1/17		1,040,000		1,071,200
TransDigm, Inc., 7.75% Sr. Unsec. Sub. Nts., 12/15/18		3,200,000		3,456,000
				11,350,575
Air Freight & Logistics—0.0%
AMGH Merger Sub, Inc., 9.25% Sr. Sec. Nts., 11/1/184		770,000		796,950
Airlines—0.2%
American Airlines 2011-2 Class A Pass Through Trust, 8.625% Sec. Certificates, 4/15/23		420,000		428,400
Delta Air Lines, Inc., 12.25% Sr. Sec. Nts., 3/15/154		3,630,000		3,811,500
				4,239,900
Building Products—0.2%
Associated Materials LLC, 9.125% Sr. Sec. Nts., 11/1/174		1,105,000		969,638
Ply Gem Industries, Inc., 13.125% Sr. Unsec. Sub. Nts., 7/15/14		3,655,000		3,252,950
Roofing Supply Group LLC/Roofing Supply Finance, Inc., 8.625% Sr. Sec. Nts., 12/1/174		990,000		1,017,500
				5,240,088
Commercial Services & Supplies—0.3%
R.R. Donnelley & Sons Co., 7.25% Sr. Nts., 5/15/18		2,000,000		1,950,000
West Corp.:
7.875% Sr. Unsec. Nts., 1/15/19		1,220,000		1,216,950
8.625% Sr. Unsec. Nts., 10/1/18		2,665,000		2,704,975
				5,871,925

22  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount		Value
Construction & Engineering—0.2%
IIRSA Norte Finance Ltd., 8.75% Sr. Nts., 5/30/244	$	3,701,713	$	4,280,290
Odebrecht Finance Ltd., 7% Sr. Unsec. Nts., 4/21/204		740,000		795,500
				5,075,790
Electrical Equipment—0.1%
Thermon Industries, Inc., 9.50% Sr. Sec. Nts., 5/1/17		1,646,000		1,781,795
Machinery—0.5%
Cleaver-Brooks, Inc., 12.25% Sr. Sec. Nts., 5/1/166		2,675,000		2,658,148
CNH Capital LLC, 6.25% Sr. Unsec. Nts., 11/1/164		520,000		538,200
Manitowoc Co., Inc. (The), 8.50% Sr. Unsec. Nts., 11/1/20		2,805,000		2,969,794
Terex Corp., 8% Sr. Unsec. Sub. Nts., 11/15/17		4,140,000		4,077,900
Thermadyne Holdings Corp., 9% Sr. Sec. Nts., 12/15/17		1,325,000		1,378,000
				11,622,042
Marine—0.2%
Marquette Transportation Co./Marquette Transportation Finance Corp., 10.875% Sec. Nts., 1/15/17		2,790,000		2,824,875
Navios Maritime Holdings, Inc./Navios Maritime Finance U.S., Inc., 8.875% Sr. Sec. Nts., 11/1/17		565,000		540,988
				3,365,863
Professional Services—0.1%
Altegrity, Inc., 10.50% Sr. Unsec. Sub. Nts., 11/1/154		1,080,000		977,400
TransUnion LLC/TransUnion Financing Corp., 11.375% Sr. Unsec. Nts., 6/15/18		660,000		757,350
				1,734,750
Road & Rail—0.3%
Hertz Corp., 7.50% Sr. Unsec. Nts., 10/15/18		3,620,000		3,801,000
Kazakhstan Temir Zholy Finance BV, 6.375% Sr. Unsec. Nts., 10/6/204		825,000		864,188
Western Express, Inc., 12.50% Sr. Sec. Nts., 4/15/154		3,730,000		1,603,900
				6,269,088
Information Technology—1.2%
Communications Equipment—0.0%
Avaya, Inc., 7% Sr. Sec. Nts., 4/1/194		1,055,000		1,028,625
Computers & Peripherals—0.2%
Seagate HDD Cayman:
6.875% Sr. Unsec. Nts., 5/1/20		1,880,000		1,941,100
7% Sr. Unsec. Nts., 11/1/214		1,695,000		1,745,850
				3,686,950
Electronic Equipment & Instruments—0.1%
CDW LLC/CDW Finance Corp., 12.535% Sr. Unsec. Sub. Nts., 10/12/17		1,920,000		1,939,200
Internet Software & Services—0.2%
ITC DeltaCom, Inc., 10.50% Sr. Sec. Nts., 4/1/16		5,135,000		5,276,213
IT Services—0.3%
Ceridian Corp., 11.25% Sr. Unsec. Nts., 11/15/15		2,145,000		1,683,825
First Data Corp.:
8.875% Sr. Sec. Nts., 8/15/204		2,390,000		2,401,950
9.875% Sr. Unsec. Nts., 9/24/15		2,085,000		1,970,325
				6,056,100
Semiconductors & Semiconductor Equipment—0.3%
Advanced Micro Devices, Inc., 7.75% Sr. Unsec. Nts., 8/1/20		2,520,000		2,601,900
Freescale Semiconductor, Inc.:
9.25% Sr. Sec. Nts., 4/15/184		1,710,000		1,836,113
10.75% Sr. Unsec. Nts., 8/1/20		1,950,000		2,042,625
NXP BV/NXP Funding LLC, 9.75% Sr. Sec. Nts., 8/1/184		855,000		936,225
				7,416,863
Software—0.1%
SunGard Data Systems, Inc.:
7.375% Sr. Unsec. Nts., 11/15/18		560,000		576,100
7.625% Sr. Unsec. Nts., 11/15/20		765,000		789,863
				1,365,963
Materials—2.5%
Chemicals—0.5%
Braskem America Finance Co., 7.125% Sr. Unsec. Nts., 7/22/414		610,000		589,413
Braskem Finance Ltd., 5.75% Sr. Unsec. Nts., 4/15/214		2,580,000		2,586,450
Ferro Corp., 7.875% Sr. Unsec. Nts., 8/15/18		1,545,000		1,560,450
Hexion U.S. Finance Corp./Hexion
Nova Scotia Finance ULC:
8.875% Sr. Sec. Nts., 2/1/18		1,315,000		1,239,388
9% Sec. Nts., 11/15/20		1,340,000		1,112,200
Lyondell Chemical Co., 8% Sr. Sec. Nts., 11/1/17		960,000		1,053,600
LyondellBasell Industries NV, 6% Sr. Nts., 11/15/214		1,525,000		1,589,813

23  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount			Value
CHEMICALS Continued
Momentive Performance Materials, Inc., 9% Sec. Nts., 1/15/21	$	2,165,000		$	1,656,225
					11,387,539
Construction Materials—0.3%
Building Materials Corp. of America, 6.75% Sr. Nts., 5/1/214		1,540,000			1,620,850
CEMEX Espana SA, 9.25% Sr. Sec. Nts., 5/12/204		872,000			673,620
CEMEX SAB de CV, 9% Sr. Sec. Nts., 1/11/184		1,950,000			1,564,875
Ply Gem Industries, Inc., 8.25% Sr. Sec. Nts., 2/15/18		1,355,000			1,187,319
Rearden G Holdings Eins GmbH, 7.875% Sr. Unsec. Nts., 3/30/204		990,000			997,425
					6,044,089
Containers & Packaging—0.2%
Berry Plastics Corp., 9.75% Sec. Nts., 1/15/21		1,580,000			1,583,950
Polymer Group, Inc., 7.75% Sr. Sec. Nts., 2/1/194		2,075,000			2,158,000
Solo Cup Co., 8.50% Sr. Sub. Nts., 2/15/14		880,000			814,000
					4,555,950
Metals & Mining—0.9%
Aleris International, Inc., 7.625% Sr. Unsec. Nts., 2/15/18		3,805,000			3,728,900
Alrosa Finance SA, 7.75% Nts., 11/3/204		1,580,000			1,580,000
Consolidated Minerals Ltd., 8.875% Sr. Sec. Nts., 5/1/164		1,245,000			1,083,150
CSN Islands XI Corp., 6.875% Sr. Unsec. Nts., 9/21/194		820,000			870,430
Ferrexpo Finance plc, 7.875% Sr. Unsec. Bonds, 4/7/164		2,105,000			1,841,875
JSC Severstal, 6.70% Nts., 10/25/174		1,940,000			1,828,450
Novelis, Inc., 8.75% Sr. Unsec. Nts., 12/15/20		465,000			501,038
Vedanta Resources plc:
8.25% Sr. Unsec. Nts., 6/7/214		2,420,000			1,899,700
9.50% Sr. Unsec. Nts., 7/18/184		7,325,000			6,372,750
					19,706,293
Paper & Forest Products—0.6%
ABI Escrow Corp., 10.25% Sr. Sec. Nts., 10/15/184		1,554,000			1,721,055
Appleton Papers, Inc., 10.50% Sr. Sec. Nts., 6/15/154		3,700,000			3,667,625
Catalyst Paper Corp., 11% Sr. Sec. Nts., 12/15/164		3,981,000			2,129,835
Mercer International, Inc., 9.50% Sr. Unsec. Nts., 12/1/17		2,005,000			2,060,138
NewPage Corp., 11.375% Sr. Sec. Nts., 12/31/145		4,855,000			3,616,975
Norske Skogindustrier ASA, 6.125% Unsec. Bonds, 10/15/156		1,500,000			907,500
					14,103,128
Telecommunication Services—2.0%
Diversified Telecommunication Services—1.0%
Axtel SAB de CV, 9% Sr. Unsec. Nts., 9/22/194		2,800,000			2,156,000
Brasil Telecom SA, 9.75% Sr. Unsec. Nts., 9/15/164	2,990,000		BRR		1,570,942
Cincinnati Bell, Inc.:
8.25% Sr. Nts., 10/15/17		1,410,000			1,424,100
8.75% Sr. Unsec. Sub. Nts., 3/15/18		2,010,000			1,876,838
Intelsat Bermuda Ltd.:
11.25% Sr. Unsec. Nts., 2/4/17		2,055,000			1,993,350
11.50% Sr. Unsec. Nts., 2/4/1715		1,424,414			1,378,121
Intelsat Jackson Holdings SA, 7.25% Sr. Unsec. Nts., 10/15/20		755,000			768,213
Level 3 Financing, Inc.:
9.25% Sr. Unsec. Unsub. Nts., 11/1/14		320,000			328,800
9.375% Sr. Unsec. Unsub. Nts., 4/1/19		3,460,000			3,628,675
Telemar Norte Leste SA, 5.50% Sr. Unsec. Nts., 10/23/204		4,302,000			4,258,980
Wind Acquisition Finance SA, 7.25% Sr. Sec. Nts., 2/15/184		1,190,000			1,085,875
Windstream Corp., 7.50% Sr. Unsec. Nts., 6/1/224		1,975,000			1,975,000
					22,444,894
Wireless Telecommunication Services—1.0%
America Movil SAB de CV:
6.125% Sr. Unsec. Unsub. Nts., 3/30/40		655,000			783,844
8.46% Sr. Unsec. Unsub. Bonds, 12/18/36	52,700,000		MXN		3,632,658
Cricket Communications, Inc., 7.75% Sr. Unsec. Nts., 10/15/20		2,440,000			2,141,100
MetroPCS Wireless, Inc., 6.625% Sr. Unsec. Nts., 11/15/20		2,770,000			2,589,950
MTS International Funding Ltd., 8.625% Sr. Unsec. Nts., 6/22/204		2,035,000			2,195,256
Nextel Communications, Inc., 7.375% Sr. Nts., Series D, 8/1/15		2,065,000			1,899,800
Sprint Capital Corp., 8.75% Nts., 3/15/32		480,000			390,600
Sprint Nextel Corp., 9% Sr. Unsec. Nts., 11/15/184		775,000			815,688

24  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Wireless Telecommunication Services Continued
Vimpel Communications/ VIP Finance Ireland Ltd. OJSC, 7.748% Nts., 2/2/214	$	1,205,000		$	1,036,300
VimpelCom Holdings BV, 7.504% Sr. Unsec. Unsub. Nts., 3/1/224		2,035,000			1,719,575
VIP Finance Ireland Ltd., 9.125% Bonds, 4/30/184		4,350,000			4,279,313
					21,484,084
Utilities—3.0%
Electric Utilities—1.8%
Centrais Eletricas Brasileiras SA:
5.75% Sr. Unsec. Unsub. Nts., 10/27/214		2,530,000			2,641,320
6.875% Sr. Unsec. Unsub. Nts., 7/30/194		1,605,000			1,829,700
Edison Mission Energy, 7% Sr. Unsec. Nts., 5/15/17		2,905,000			1,902,775
Empresa Distribuidora y Comercializadora Norte SA, 9.75% Nts., 10/25/224		800,000			664,000
Empresas Publicas de Medellin ESP, 7.625% Sr. Unsec. Nts., 7/29/194		1,445,000			1,683,425
Energy Future Intermediate Holding Co. LLC, 10% Sr. Sec. Nts., 12/1/20		1,992,000			2,111,520
Eskom Holdings Ltd.:
5.75% Sr. Unsec. Bonds, 1/26/214		3,010,000			3,077,725
7.85% Sr. Unsec. Unsub. Nts., Series ES26, 4/2/26		31,000,000	ZAR		3,491,475
10% Nts., Series ES23, 1/25/23		44,000,000	ZAR		6,064,528
Israel Electric Corp. Ltd., 7.25% Nts., 1/15/194		4,440,000			4,586,786
Majapahit Holding BV:
7.75% Nts., 10/17/164		2,250,000			2,534,063
8% Sr. Unsec. Nts., 8/7/194,8		1,650,000			1,947,000
National Power Corp., 5.875% Unsec. Unsub. Bonds, 12/19/16		109,600,000	PHP		2,789,456
Perusahaan Listrik Negara PT, 5.50% Sr. Unsec. Nts., 1/22/214		2,220,000			2,269,950
Texas Competitive Electric Holdings Co. LLC:
10.25% Sr. Unsec. Nts., Series A, 11/1/15		8,270,000			2,977,200
10.25% Sr. Unsec. Nts., Series B, 11/1/15		1,460,000			511,000
					41,081,923
Energy Traders—0.9%
AES Corp. (The), 8% Sr. Unsec. Unsub. Nts., 10/15/17		855,000			944,775
Calpine Corp., 7.50% Sr. Sec. Nts., 2/15/214		885,000			951,375
Colbun SA, 6% Sr. Unsec. Nts., 1/21/204		1,750,000			1,860,646
Comision Federal de Electricidad, 4.875% Sr. Nts., 5/26/214,8		1,725,000			1,794,000
Energy Future Holdings Corp., 10% Sr. Sec. Nts., 1/15/20		1,840,000			1,941,200
First Wind Capital LLC, 10.25% Sr. Sec. Nts., 6/1/184		270,000			266,625
Foresight Energy LLC, 9.625% Sr. Unsec. Nts., 8/15/174		1,895,000			1,951,850
GenOn Energy, Inc., 9.50% Sr. Unsec. Nts., 10/15/18		1,465,000			1,490,638
NRG Energy, Inc., 7.625% Sr. Unsec. Nts., 1/15/18		560,000			562,800
Power Sector Assets & Liabilities Management Corp.:
7.25% Sr. Gtd. Unsec. Nts., 5/27/194		1,110,000			1,351,425
7.39% Sr. Gtd. Unsec. Nts., 12/2/244		1,200,000			1,473,000
PT Cikarang Listindo/Listindo Capital BV, 9.25% Sr. Nts., 1/29/154		1,120,000			1,219,364
United Maritime Group LLC, 11.75% Sr. Sec. Nts., 6/15/15		3,630,000			3,711,643
					19,519,341
Gas Utilities—0.1%
Empresa de Energia de Bogota SA ESP, 6.125% Sr. Unsec. Unsub. Nts., 11/10/216		870,000			885,225
Ferrellgas LP/Ferrellgas Finance Corp., 6.50% Sr. Unsec. Nts., 5/1/21		680,000			601,800
TGI International Ltd., 9.50% Nts., 10/3/174		1,352,000			1,455,090
					2,942,115
Multi-Utilities—0.1%
Abu Dhabi National Energy Co. (TAQA), 5.875% Sr. Unsec. Nts., 12/13/214		1,690,000			1,766,050
Water Utilities—0.1%
Cia de Saneamento Basico do Estado de Sao Paulo, 6.25% Sr. Unsec. Nts., 12/16/204		1,475,000			1,530,313
Total Corporate Bonds and Notes (Cost $615,468,202)					584,115,534

	Shares
Preferred Stocks—0.3%
Ally Financial, Inc., 7%, Non-Vtg.4		3,112	2,231,012
GMAC Capital Trust I, 8.125% Cum.		30,000	580,200
Greektown Superholdings, Inc., Series A-12		45,600	2,968,560
Total Preferred Stocks (Cost $8,077,075)			5,779,772

25  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Shares			Value
Common Stocks—0.6%
AbitibiBowater, Inc.2		88,383		$	1,285,973
American Media Operations, Inc. 2		161,731			2,587,696
Arco Capital Corp. Ltd.2,6		690,638			1,381,276
Dana Holding Corp.2		72,775			884,216
Gaylord Entertainment Co., Cl. A2		43,813			1,057,646
Global Aviation Holdings, Inc.2		100			1,000
Greektown Superholdings, Inc. 2		3,450			208,932
Huntsman Corp.		25,585			255,850
Kaiser Aluminum Corp.		229			10,507
LyondellBasell Industries NV, Cl. A		45,017			1,462,602
MHP SA, GDR2,4		56,610			606,293
Orbcomm, Inc.2		375			1,121
Premier Holdings Ltd.2		18,514			—
Range Resources Corp.		7,593			470,310
Solutia, Inc.2		21,182			366,025
Visteon Corp. 2		36,636			1,829,602
Walter Industries, Inc.		3,907			236,608
Whiting Petroleum Corp.2		7,858			366,890
Total Common Stocks (Cost $27,341,263)					13,012,547
	Units
Rights, Warrants and Certificates—0.0%
MediaNews Group, Inc. Wts., Strike Price $0.001, Exp. 3/19/17 2 (Cost $3,162,655)		11,668			420
	Principal
	Amount
Structured Securities—5.6%
Barclays Bank plc:
Indonesia (Republic of) Total Return Linked Bonds, 10.50%, 8/19/30	13,870,000,000		IDR		2,067,613
Indonesia (Republic of) Total Return Linked Bonds, Series 22, 11%, 9/17/25	10,380,000,000		IDR		1,579,752
Indonesia (Republic of) Total Return Linked Nts., Series 51, 10.50%, 8/19/30	2,650,000,000		IDR		395,038
Indonesia (Republic of) Total Return Linked Nts., Series 51, 11%, 9/17/25	2,650,000,000		IDR		403,309
Russian Federation Total Return Linked Bonds, 7.15%, 1/25/133	57,980,000		RUR		1,811,650
Russian Federation Total Return Linked Bonds, 6.70%, 2/8/133	59,410,000		RUR		1,847,108
Citigroup Funding, Inc.:
ALROSA Russia Corporate Bond Credit Linked Unsec. Nts., 8.25%, 6/25/153,6	19,220,000		RUR		601,296
Indonesia (Republic of) Total Return Linked Nts., 11%, 9/17/25	2,100,000,000		IDR	$	319,603
Russian Federation Credit Linked Bonds, 6.70%, 2/8/133,6	39,820,000		RUR		1,238,347
Citigroup Global Markets Holdings, Inc.:
Adira Dinamika Multi Finance Credit Linked Nts., 6.75%, 1/5/124	34,400,000,000		IDR		3,794,907
Colombia (Republic of) Credit Linked Bonds, 11.25%, 10/25/186	3,255,000,000		COP		2,024,781
Colombia (Republic of) Credit Linked Nts., Series 2, 10%, 7/25/24	10,368,000,000		COP		6,359,928
Colombia (Republic of) Total Return Linked Bonds, Series 2, 11%, 7/27/20	2,665,000,000		COP		1,656,246
Dominican Republic Unsec. Credit Linked Nts., 15%, 3/12/126	49,300,000		DOP		1,278,000
Credit Suisse First Boston International:
Moitk Total Return Linked Nts., 21%, 3/30/115	53,910,000		RUR		5,022
Russian Oreniz Total Return Linked Nts., 9.24%, 2/24/123	81,784,500		RUR		2,501,736
Credit Suisse First Boston, Inc. (Nassau Branch), Russian Specialized Construction & Installation Administration Total Return Linked Nts., 13%, 5/24/105	97,250,000		RUR		302
Credit Suisse Group AG, Russian Moscoblgaz Finance Total Return Linked Nts., 9.25%, 6/27/12	42,600,000		RUR		1,289,747
Credit Suisse International:
OAO Gazprom Total Return Linked Nts., 13.12%, 6/28/123	41,550,000		RUR		1,328,919
OAO Gazprom Total Return Linked Nts., 13.12%, 6/28/123	30,880,000		RUR		987,654
OAO Gazprom Total Return Linked Nts., 13.12%, 6/28/123	44,460,000		RUR		1,421,991
Deutsche Bank AG:
Coriolanus Ltd. Sec. Credit Linked Bonds, Series 128, 3.006%, 5/6/256,13		1,831,327			1,232,704
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.061%, 5/6/256,13		2,333,393			1,570,655
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.10%, 5/6/256,13		2,014,511			1,356,009
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.134%, 5/6/256,13		1,800,719			1,212,101
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.187%, 5/6/256,13		2,242,041			1,509,164

26  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Principal
	Amount			Value
Structured Securities Continued
Deutsche Bank AG: Continued
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.239%, 5/6/256,13	$	2,558,949		$	1,722,481
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.266%, 5/6/256,13		2,044,301			1,376,061
Coriolanus Ltd. Sec. Credit Linked Bonds, 3.343%, 5/6/256,13		1,921,557			1,293,439
Coriolanus Ltd. Sec. Credit Linked Nts., 12.424%, 12/31/176	15,420,000		BRR		9,946,565
JSC Gazprom Total Return Linked Nts., 13.12%, 6/28/123	38,600,000		RUR		1,236,844
JSC Gazprom Total Return Linked Nts., Series 4, 13.12%, 6/28/123	45,990,000		RUR		1,473,639
JSC VTB Bank Credit Linked Nts., 12%, 6/19/123,6	20,500,000		UAH		2,454,472
Opic Reforma I Credit Linked Nts., Cl. 2A, 8.287%, 5/22/153,6	697,693		MXN		48,425
Opic Reforma I Credit Linked Nts., Cl. 2B, 8.287%, 5/22/153,6	1,220,632		MXN		84,720
Opic Reforma I Credit Linked Nts., Cl. 2C, 8.287%, 5/22/153,6	18,404,162		MXN		1,277,379
Opic Reforma I Credit Linked Nts., Cl. 2D, 8.287%, 5/22/153,6	1,341,270		MXN		93,094
Opic Reforma I Credit Linked Nts., Cl. 2E, 8.287%, 5/22/153,6	974,458		MXN		67,634
Opic Reforma I Credit Linked Nts., Cl. 2F, 8.287%, 5/22/153,6	622,337		MXN		43,195
Opic Reforma I Credit Linked Nts., Cl. 2G, 8.287%, 5/22/153,6	114,609		MXN		7,955
Eirles Two Ltd. Sec. Nts.:
Series 324, 3.798%, 4/30/123,6		4,100,000			3,767,900
Series 335, 2.248%, 4/30/123,6		6,300,000			6,016,500
Goldman Sachs Capital Markets LP, Colombia (Republic of) Credit Linked Nts., 10.476%, 2/8/376,13	63,720,800,000		COP		1,738,886
Hallertau SPC Credit Linked Nts.:
Series 2007-01, 2.838%, 12/20/173,6		6,250,000			5,174,375
Series 2008-01, 9.888%, 8/2/105,6,13	14,337,604		BRR		768,669
Series 2008-2A, 8.14%, 9/17/133,6		12,143,750			6,820,359
HSBC Bank USA NA:
Indonesia (Republic of) Credit Linked Nts., Series 2, 8.25%, 7/15/214	13,360,000,000		IDR		1,709,137
Indonesia (Republic of) Credit Linked Nts., Series 2, 9.50%, 7/15/314	13,330,000,000		IDR		1,852,308
JPMorgan Chase & Co.:
Colombia (Republic of) Credit Linked Nts., 11%, 7/28/206	1,315,000,000		COP		817,423
Indonesia (Republic of) Credit Linked Bonds, 8.25%, 7/19/214	15,945,000,000		IDR		2,039,835
Indonesia (Republic of) Credit Linked Bonds, Series 10, 8.25%, 7/19/214	5,350,000,000		IDR		684,422
Indonesia (Republic of) Credit Linked Bonds, Series 11, 8.25%, 7/19/214	3,070,000,000		IDR		392,743
Indonesia (Republic of) Credit Linked Bonds, Series 6, 8.25%, 7/19/214	10,090,000,000		IDR		1,290,808
Indonesia (Republic of) Credit Linked Bonds, Series 7, 8.25%, 7/19/214	22,680,000,000		IDR		2,901,439
Indonesia (Republic of) Credit Linked Bonds, Series 9, 8.25%, 7/19/214	3,970,000,000		IDR		507,880
Indonesia (Republic of) Credit Linked Nts., Series 4, 11%, 9/17/25	32,670,000,000		IDR		4,972,109
Indonesia (Republic of) Total Return Linked Nts., Series 53, 11%, 9/17/254	2,100,000,000		IDR		319,603
JPMorgan Chase Bank NA:
Indonesia (Republic of) Credit Linked Nts., Series 1, 9.50%, 7/17/314	4,222,000,000		IDR		586,680
Indonesia (Republic of) Credit Linked Nts., Series 2, 10.50%, 8/19/304	17,135,000,000		IDR		2,554,329
Russian Federation Credit Linked Bonds, 6.70%, 2/8/133,4	39,840,000		RUR		1,238,351
Russian Federation Credit Linked Bonds, Series 2, 7.15%, 1/25/133,6	48,970,000		RUR		1,528,982
LB Peru Trust II Certificates, Series 1998-A, 4.534%, 2/28/165,13		363,871			36,387
Lehman Brothers Treasury Co. BV, Microvest Capital Management LLC Credit Linked Nts., 7.55%, 5/24/126		1,089,830			331,962
Merrill Lynch, Colombia (Republic of) Credit Linked Nts., 10%, 11/17/166	1,784,000,000		COP		930,515
Morgan Stanley:
Peru (Republic of) Credit Linked Nts., 6.25%, 3/23/174	4,885,000		PEN		1,344,394
Russian Federation Total Return Linked Bonds, Series 007, Cl. VR, 5%, 8/22/34	62,606,453		RUR		931,673
Morgan Stanley Capital Services, Inc.:
Brazil (Federative Republic of) Credit Linked Nts., 12.551%, 1/5/224,13	28,914,000		BRR		2,163,996
United Mexican States Credit Linked Nts., 5.64%, 11/20/154		2,000,000			1,568,000
Standard Bank Group Ltd., Ghana (Republic of) Credit Linked Bonds, 10.038%, 1/25/126,13	1,710,000		GHS		1,036,743
UBS AG:
Indonesia (Republic of) Total Return Linked Nts., 8.25%, 7/19/21	19,270,000,000		IDR		2,465,200

27  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

	Principal
	Amount	Value
Structured Securities Continued
UBS AG: Continued
Indonesia (Republic of) Total Return Linked Nts., Series 1, 9.50%, 7/17/31	14,700,000,000 IDR	$	2,042,680
Indonesia (Republic of) Total Return Linked Nts., Series 3, 8.25%, 7/19/21	2,970,000,000 IDR		379,950
Indonesia (Republic of) Total Return Linked Nts., Series 5, 8.25%, 7/19/21	23,105,000,000 IDR		2,955,809
Indonesia (Republic of) Total Return Linked Nts., Series 999, 9.50%, 7/17/31	18,212,000,000 IDR		2,530,700
Total Structured Securities (Cost $155,955,100)			127,320,232

	Expiration		Strike
	Date		Price			Contracts
Options Purchased—0.2%
Australian Dollar (AUD) Call2		1/13/12	$	1.040			1,905,000	6,373
Australian Dollar (AUD) Call2		1/13/12		1.040			1,905,000	6,373
Australian Dollar (AUD) Call2		1/13/12		1.040			2,930,000	9,802
Australian Dollar (AUD) Call2		1/17/12		1.040			950,000	4,215
Australian Dollar (AUD) Futures, 3/19/12 Put2		1/9/12		95.000			95	475
Australian Dollar (AUD) Futures, 3/19/12 Put2		1/9/12		99.000			48	5,760
Australian Dollar (AUD) Futures, 3/19/12 Put2		1/9/12		89.000			49	245
Euro (EUR) 90 Day Futures, 3/19/12 Put2		1/16/12		99.250			179	3,356
Euro (EUR) 90 Day Futures, 3/19/12 Put2		2/13/12		99.250			179	12,306
Euro (EUR) Call2		1/13/12		1.390			950,000	9
Euro (EUR) Call2		1/13/12		1.450			950,000	—
Euro (EUR) Call2		1/18/12		1.400			955,000	23
Euro (EUR) FX Futures, 3/19/12 Put2		3/12/12		1.310			36	176,850
Euro-Bundesobligation Futures, 3/8/12 Call2		1/30/12	143.000 EUR				136	35,204
Euro-Bundesobligation Futures, 3/8/12 Put2		1/30/12	130.000 EUR				484	18,792
Euro-Bundesobligation Futures, 3/8/12 Put2		1/30/12	132.000 EUR				484	37,585
Euro-Bundesobligation Futures, 3/8/12 Put2		1/30/12	135.000 EUR				97	32,641
Euro-Bundesobligation Futures, 3/8/12 Put2		2/27/12	133.000 EUR				98	43,124
Euro-Bundesobligation Futures, 3/8/12 Put2		2/27/12	134.000		EUR		433	263,392
Indonesia Rupiah (IDR) Put2		1/27/12	9,300,000		IDR		61,700,000,000	70,338
Indonesia Rupiah (IDR) Put2		1/27/12	9,300,000		IDR		30,900,000,000	35,226
Indonesia Rupiah (IDR) Put2		1/30/12	9,300,000		IDR		30,800,000,000	33,880
Japanese Yen (JPY) Futures, 3/19/12 Put2		1/9/12		127.500			24	2,400
Japanese Yen (JPY) Futures, 3/19/12 Put2		1/9/12		126.500			4	250
Japanese Yen (JPY) Futures, 3/19/12 Put2		1/9/12		127.000			41	3,075
Japanese Yen (JPY) Futures, 3/19/12 Put2		1/9/12		128.000			3	413
Japanese Yen (JPY) Futures, 3/19/12 Put2		2/6/12		127.000			20	9,250
Japanese Yen (JPY) Futures, 3/19/12 Put2		3/12/12		127.500			20	24,250
Japanese Yen (JPY) Futures, 3/19/12 Put2		3/12/12		127.000			56	58,800
Japanese Yen (JPY) Put2		10/23/12	85.000		JPY		322,000,000	36,892
Mexican Nuevo Peso (MXN) Call2		1/18/12	12.950		MXN		64,860,000	385
Mexican Nuevo Peso (MXN) Call2		1/18/12	12.950		MXN		64,860,000	385
New Zealand Dollar (NZD) Call2		1/13/12		0.840			2,860,000	32
New Zealand Dollar (NZD) Call2		1/17/12		0.840			2,800,000	119
New Zealand Dollar (NZD) Call2		1/17/12		0.840			2,855,000	121
South Korean Won (KRW) Call2		1/19/12	1,120.000		KRW		1,219,000,000	1,158
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Call2		1/30/12		131.000			222	190,781
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12		125.000			467	7,297
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12		125.500			188	2,938
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12		127.500			13	813
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12		128.000			664	62,250
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12		128.500			117	14,625

28  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Expiration		Strike
	Date		Price		Contracts		Value
Options Purchased Continued
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		1/30/12	$	129.500		58	$	15,406
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		2/27/12		123.500		89		5,563
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		2/27/12		125.500		89		9,734
U.S. Treasury Nts. Futures, 10 yr., 3/21/12 Put2		2/27/12		126.500		9		1,406
U.S. Treasury Nts., 3.125%, 11/15/41 Call 2		5/30/12		103.470		70,500,000		4,428,281
Total Options Purchased (Cost $8,462,954)								5,672,593
	Exercise				Notional
	Date				Amount
Swaptions Purchased—0.2%
Goldman Sachs Group, Inc. (The); Interest Rate Swaption (European); Swap Terms; Paid: 2.495%; Received: Three-Month USD BBA LIBOR; Termination Date: 11/22/222		11/23/12		2.500	$	37,700,000		1,002,622
UBS AG; Interest Rate Swaption (European); Swap Terms; Paid: 2.215%; Received:
Three-Month USD BBA LIBOR; Termination Date: 12/4/222		12/3/12		2.220		96,515,000		3,449,483
Total Swaptions Purchased (Cost $6,458,261)								4,452,105

	Shares			Value
Investment Companies—19.7%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%1,18		27,393,119		$	27,393,119
Oppenheimer Master Event-Linked Bond Fund, LLC1		4,827,322			54,385,728
Oppenheimer Master Loan Fund, LLC1		29,466,809			351,705,692
Oppenheimer Short Duration Fund, Cl. Y1		1,001,329			10,013,286
Total Investment Companies (Cost $453,272,500)					443,497,825
Total Investments, at Value (Cost $2,467,842,455)		103.2	%		2,325,918,740
Liabilities in Excess of Other Assets		(3.2	)		(72,928,642	)
Net Assets		100.0	%	$	2,252,990,098

29  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments

*December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies:

AUD	Australian Dollar
BRR	Brazilian Real
CAD	Canadian Dollar
COP	Colombian Peso
DKK	Danish Krone
DOP	Dominican Republic Peso
EUR	Euro
GBP	British Pound Sterling
GHS	Ghana Cedi
HUF	Hungarian Forint
IDR	Indonesia Rupiah
ILS	Israeli Shekel
JPY	Japanese Yen
KRW	South Korean Won
MXN	Mexican Nuevo Peso
MYR	Malaysian Ringgit
NZD	New Zealand Dollar
PEN	Peruvian New Sol
PHP	Philippines Peso
PLZ	Polish Zloty
RUR	Russian Ruble
SGD	Singapore Dollar
TRY	New Turkish Lira
UAH	Ukraine Hryvnia
ZAR	South African Rand

1. Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		83,436,389		624,478,359		680,521,629		27,393,119
Oppenheimer Global Strategic Bond Fund/VA		—		15,000		—		15,000
(Cayman) Ltd.a
Oppenheimer Master Event-Linked Bond Fund, LLC		1,103,918		3,723,404		—		4,827,322
Oppenheimer Master Loan Fund, LLC		29,466,809		—		—		29,466,809
Oppenheimer Short Duration Fund, Cl. Y		—		1,001,329		—		1,001,329

						Realized
	Value		Income			Gain (Loss)
Oppenheimer Institutional Money Market Fund, Cl. E	$	27,393,119	$	89,809		$	—
Oppenheimer Global Strategic Bond Fund/VA		1,482,519		—			—
(Cayman) Ltd.a
Oppenheimer Master Event-Linked Bond Fund, LLC		54,385,728		4,073,320	b		(2,323,415	)b
Oppenheimer Master Loan Fund, LLC		351,705,692		27,436,119	c		455,054	c
Oppenheimer Short Duration Fund, Cl. Y		10,013,286		18,665			—
	$	444,980,344	$	31,617,913		$	(1,868,361	)

a.	Investment in a wholly-owned subsidiary. See Note 1 of the accompanying Notes and individual financial statements of the entity included herein.
b.	Represents the amount allocated to the Fund from Oppenheimer Master Event-Linked Bond Fund, LLC.
c.	Represents the amount allocated to the Fund from Oppenheimer Master Loan Fund, LLC.
2.	Non-income producing security.
3.	Represents the current interest rate for a variable or increasing rate security.
4.	Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $374,254,289 or 16.61% of the Fund’s net assets as of December 30, 2011.
5.	This security is not accruing income because the issuer has missed an interest payment on it and/or is not anticipated to make future interest and/or principal payments. The rate shown is the original contractual interest rate. See Note 1 of the accompanying Notes.
6.	Restricted security. The aggregate value of restricted securities as of December 30, 2011 was $80,967,420, which represents 3.59% of the Fund’s net assets. See Note 6 of the accompanying Notes. Information concerning restricted securities is as follows:

							Unrealized
	Acquisition						Appreciation
Security	Dates		Cost		Value		(Depreciation)
Arco Capital Corp. Ltd.		2/27/07	$	10,359,570	$	1,381,276	$	(8,978,294	)
Citigroup Funding, Inc., ALROSA Russia Corporate Bond Credit Linked Unsec. Nts., 8.25%, 6/25/15		3/1/11		679,152		601,296		(77,856	)
Citigroup Funding, Inc., Russian Federation Credit Linked Bonds, 6.70%, 2/8/13		3/2/11		1,411,191		1,238,347		(172,844	)
Citigroup Global Markets Holdings, Inc., Colombia (Republic of) Credit Linked Bonds, 11.25%, 10/25/18		12/9/08		1,376,941		2,024,781		647,840
Citigroup Global Markets Holdings, Inc., Dominican Republic Unsec. Credit Linked Nts., 15%, 3/12/12		3/7/07		1,479,820		1,278,000		(201,820	)

30  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

							Unrealized
	Acquisition						Appreciation
Security	Dates		Cost		Value		(Depreciation)
Cleaver-Brooks, Inc., 12.25% Sr. Sec. Nts., 5/1/16		4/21/10-5/3/11	$	2,685,164	$	2,658,148	$	(27,016	)
Deutsche Alt-A Securities, Inc., Mtg. Pass-Through Certificates, Series 2007-RS1, Cl. A2, 0.794%, 1/27/37		5/29/08		968,781		605,015		(363,766	)
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, Series 128, 3.006%, 5/6/25		10/8/10		1,239,751		1,232,704		(7,047	)
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.343%, 5/6/25		4/16/09		1,262,351		1,293,439		31,088
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.266%, 5/6/25		8/18/09		1,351,510		1,376,061		24,551
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.239%, 5/6/25		9/25/09		1,695,487		1,722,481		26,994
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.187%, 5/6/25		12/17/09		1,492,145		1,509,164		17,019
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.134%, 5/6/25		3/30/10		1,204,077		1,212,101		8,024
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.10%, 5/6/25		5/18/10		1,351,634		1,356,009		4,375
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Bonds, 3.061%, 5/6/25		7/16/10		1,571,099		1,570,655		(444	)
Deutsche Bank AG, Coriolanus Ltd. Sec. Credit Linked Nts., 12.424%, 12/31/17		9/19/07		6,852,465		9,946,565		3,094,100
Deutsche Bank AG, JSC VTB Bank Credit Linked Nts., 12%, 6/19/12		6/30/11		2,586,915		2,454,472		(132,443	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2A, 8.287%, 5/22/15		5/21/08		67,269		48,425		(18,844	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2B, 8.287%, 5/22/15		6/12/08		117,680		84,720		(32,960	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2C, 8.287%, 5/22/15		6/18/08		1,785,486		1,277,379		(508,107	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2D, 8.287%, 5/22/15		7/8/08		130,028		93,094		(36,934	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2E, 8.287%, 5/22/15		7/15/08		94,626		67,634		(26,992	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2F, 8.287%, 5/22/15		8/8/08		61,263		43,195		(18,068	)
Deutsche Bank AG, Opic Reforma I Credit Linked Nts., Cl. 2G, 8.287%, 5/22/15		8/22/08		11,304		7,955		(3,349	)
Eirles Two Ltd. Sec. Nts., Series 324, 3.798%, 4/30/12		4/17/07		4,100,884		3,767,900		(332,984	)
Eirles Two Ltd. Sec. Nts., Series 335, 2.248%, 4/30/12		9/17/07		6,282,061		6,016,500		(265,561	)
Embarcadero Aircraft Securitization Trust, Airplane Receivable Nts., Series 2000-A, Cl. B, 0.656%, 8/15/25		8/17/00		1,820,063		—		(1,820,063	)
Empresa de Energia de Bogota SA ESP, 6.125% Sr. Unsec. Unsub. Nts., 11/10/21		11/3/11-12/16/11		870,449		885,225		14,776
Goldman Sachs Capital Markets LP, Colombia (Republic of) Credit Linked Nts., 10.476%, 2/8/37		1/18/07		6,374,568		1,738,886		(4,635,682	)
Hallertau SPC Credit Linked Nts., Series 2007-01, 2.838%, 12/20/17		12/13/07		6,250,000		5,174,375		(1,075,625	)
Hallertau SPC Credit Linked Nts., Series 2008-01, 9.888%, 8/2/10		4/18/08-10/1/08		7,188,001		768,669		(6,419,332	)
Hallertau SPC Credit Linked Nts., Series 2008-2A, 8.14%, 9/17/13		10/23/08		12,215,603		6,820,359		(5,395,244	)
Ice 1 Em CLO Ltd./Ice 1 Em CLO Corp., Sr. Sec. Sub. Term Nts., Series 2007-1A, Cl. B, 2.152%, 8/15/22		11/6/07		7,001,104		5,115,500		(1,885,604	)
Ice 1 Em CLO Ltd./Ice 1 Em CLO Corp., Sr. Sec. Sub. Term Nts., Series 2007-1A, Cl. C, 3.452%, 8/15/22		6/8/07		5,270,000		3,320,100		(1,949,900	)
Ice 1 Em CLO Ltd./Ice 1 Em CLO Corp., Sr. Sec. Sub. Term Nts., Series 2007-1A, Cl. D, 5.452%, 8/15/22		6/8/07		5,270,000		3,425,500		(1,844,500	)
JPMorgan Chase & Co., Colombia (Republic of) Credit Linked Nts., 11%, 7/28/20		8/24/10		902,343		817,423		(84,920	)
JPMorgan Chase Bank NA, Russian Federation Credit Linked Bonds, Series 2, 7.15%, 1/25/13		2/28/11		1,714,455		1,528,982		(185,473	)
JPMorgan Hipotecaria su Casita, 7.973% Sec. Nts., 8/26/35		3/21/07		526,714		466,307		(60,407	)
Lehman Brothers Treasury Co. BV, Microvest Capital Management LLC Credit Linked Nts., 7.55%, 5/24/12		6/20/07		1,091,362		331,962		(759,400	)
Merrill Lynch, Colombia (Republic of) Credit Linked Nts., 10%, 11/17/16		10/20/06		762,393		930,515		168,122
NC Finance Trust, Collateralized Mtg. Obligation Pass-Through Certificates, Series 1999-I, Cl. ECFD, 3.405%, 1/25/29		8/10/10		66,025		6,007		(60,018	)
Norske Skogindustrier ASA, 6.125% Unsec. Bonds, 10/15/15		3/7/11-4/6/11		1,364,632		907,500		(457,132	)
Premier Cruise Ltd., 11% Sr. Nts., 3/15/08		3/6/98		242,675		—		(242,675	)
Santander Drive Auto Receivables Trust 2011-S1A, Automobile Receivables Nts., Series 2011-S1A, Cl. D, 3.10%, 5/15/17		2/4/11-4/14/11		227,780		225,476		(2,304	)
Southern States Cooperative, Inc., 11.25% Sr. Nts., 5/15/15		9/22/10-9/23/10		2,614,264		2,600,575		(13,689	)
Standard Bank Group Ltd., Ghana (Republic of) Credit Linked Bonds, 10.038%, 1/25/12		9/16/11		1,085,794		1,036,743		(49,051	)
			$	115,076,879	$	80,967,420	$	(34,109,459	)

7.	This security is accruing partial income at an anticipated effective rate based on expected interest and/or principal payments. The rate shown is the original contractual interest rate.
8.	When-issued security or delayed delivery to be delivered and settled after December 30, 2011. See Note 1 of the accompanying Notes.

31  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT O F INVESTMENTS Continued

Footnotes to Statement of Investments Continued

9.	Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans or other receivables. 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 or asset-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. These securities amount to $10,129,464 or 0.45% of the Fund’s net assets as of December 30, 2011.
10.	The current amortization rate of the security’s cost basis exceeds the future interest payments currently estimated to be received. Both the amortization rate and interest payments are contingent on future mortgage pre-payment speeds and are therefore subject to change.
11.	All or a portion of the security position is held in collateral accounts to cover the Fund’s obligations under certain derivative contracts. The aggregate market value of such securities is $5,763,355 See Note 5 of the accompanying Notes.
12.	All or a portion of the security position is held in collateralized accounts to cover initial margin requirements on open futures contracts and written options on futures, if applicable. The aggregate market value of such securities is $12,776,418. See Note 5 of the accompanying Notes.
13.	Zero coupon bond reflects effective yield on the date of purchase.
14.	Denotes an inflation-indexed security: coupon or principal are indexed to a consumer price index.
15.	Interest or dividend is paid-in-kind, when applicable.
16.	This bond has no contractual maturity date, is not redeemable and contractually pays an indefinite stream of interest. Rate reported represents the current interest rate for this variable rate security.
17.	Denotes a step bond: a zero coupon bond that converts to a fixed or variable interest rate at a designated future date.
18.	Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3–
	Level 1–		Level 2–		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Wholly-Owned Subsidiary	$	—	$	1,482,519	$	—	$	1,482,519
Asset-Backed Securities		—		10,763,457		11,861,100		22,624,557
Mortgage-Backed Obligations		—		447,222,572		1,423,222		448,645,794
U.S. Government Obligations		—		180,362,405		—		180,362,405
Foreign Government Obligations		—		468,074,488		—		468,074,488
Loan Participations		—		20,877,949		—		20,877,949
Corporate Bonds and Notes		—		584,115,534		—		584,115,534
Preferred Stocks		—		2,811,212		2,968,560		5,779,772
Common Stocks		7,004,041		5,798,574		209,932		13,012,547
Rights, Warrants and Certificates		—		—		420		420
Structured Securities		—		120,126,200		7,194,032		127,320,232
Options Purchased		1,038,981		4,633,612		—		5,672,593
Swaptions Purchased		—		4,452,105		—		4,452,105
Investment Companies		37,406,405		406,091,420		—		443,497,825
Total Investments, at Value		45,449,427		2,256,812,047		23,657,266		2,325,918,740
Other Financial Instruments:
Appreciated swaps, at value		—		4,059,953		—		4,059,953
Depreciated swaps, at value		—		1,058,863		—		1,058,863
Futures margins		919,349		—		—		919,349
Foreign currency exchange contracts		—		6,674,020		—		6,674,020
Total Assets	$	46,368,776	$	2,268,604,883	$	23,657,266	$	2,338,630,925

32  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

							Level 3–
	Level 1–			Level 2–			Significant
	Unadjusted			Other Significant			Unobservable
	Quoted Prices			Observable Inputs			Inputs		Value
Liabilities Table
Other Financial Instruments:
Appreciated swaps, at value	$	—		$	(2,186,195	)	$	—	$	(2,186,195	)
Depreciated swaps, at value		—			(3,188,215	)		—		(3,188,215	)
Appreciated options written, at value		(1,271,573	)		(155,575	)		—		(1,427,148	)
Depreciated options written, at value		(937,077	)		—			—		(937,077	)
Appreciated swaptions written, at value		—			(1,798,390	)		—		(1,798,390	)
Depreciated swaptions written, at value		—			(5,770,471	)		—		(5,770,471	)
Futures margins		(289,872	)		—			—		(289,872	)
Foreign currency exchange contracts		—			(9,409,937	)		—		(9,409,937	)
Total Liabilities	$	(2,498,522	)	$	(22,508,783	)	$	—	$	(25,007,305	)

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

The table below shows the significant transfers between Level 1, Level 2 and Level 3. The Fund’s policy is to recognize transfers in and transfers out as of the beginning of the reporting period.

	Transfers out of			Transfers into			Transfers out of			Transfers into			Transfers out of
	Level 1			Level 2			Level 2			Level 3			Level 3
Assets Table
Investments, at Value:
Common Stocks	$	—		$	1,381,276	a	$	—		$	—		$	(1,381,276	)a
Structured Securities		—			—			(13,653,340	)b		13,653,340	b		—
Investment Companies		(353,953,479	)c		353,953,479	c		—			—			—
Total Assets	$	(353,953,479	)	$	355,334,755		$	(13,653,340	)	$	13,653,340		$	(1,381,276	)

a.	Transferred from Level 3 to Level 2 because of the presence of observable market data due to an increase in market activity for these securities.
b.	Transferred from Level 2 to Level 3 because of the lack of observable market data due to a decrease in market activity for these securities.
c.	Transferred from Level 1 to Level 2 as the current market for the securities are not considered active.

The following is a reconciliation of assets in which significant unobservable inputs (level 3) were used in determining fair value:

						Change in			Accretion/
						Unrealized			(Amortization)												Value as of
	Value as of		Realized			Appreciation/			of Premium/						Transfers into			Transfers out			December 30,
	December 31, 2010		Gain (Loss)			Depreciation			Discount			Sales			Level 3			of Level 3			2011
Assets Table
Investments, at Value:
Asset-Backed Securities	$	10,800,935	$	755		$	1,241,950		$	48,178	a	$	(230,718	)	$	—		$	—		$	11,861,100
Mortgage-Backed Obligations		1,581,294		—			(172,330	)		14,258	a		—			—			—			1,423,222
Corporate Bonds and Notes		1,744,997		(672,002	)		959,482			—			(932,477	)		—			(1,100,000	)b		—
Preferred Stocks		4,844,088		(537,064	)		(1,338,464	)		—			—			—			—			2,968,560
Common Stocks		4,360,342		(34,604	)		1,807,026			—			—			—			(5,922,832	)c		209,932
Rights, Warrants and Certificates		423		(2,025	)		2,022			—			—			—			—			420
Structured Securities		1,288,812		—			(7,724,149	)		(23,971	)a		—			13,653,340	d		—			7,194,032
Total Assets	$	24,620,891	$	(1,244,940	)	$	(5,224,463	)	$	38,465		$	(1,163,195	)	$	13,653,340		$	(7,022,832	)	$	23,657,266

a.	Included in net investment income.
b.	Transferred from Level 3 because of the presence of observable market data due to a increase in market activity for these securities.
c.	Transferred from Level 3 because of the presence of a readily available unadjusted quoted market price for these securities.
d.	Transferred to Level 3 because of the lack of observable market data due to a decrease in market activity for these securities.

33  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The total change in unrealized appreciation/depreciation included in the Statement of Operations attributable to Level 3 investments still held at December 30, 2011 includes:

	Change in unrealized
	appreciation/depreciation
Asset-Backed Securities	$	1,241,922
Mortgaged-Backed Obligations		163,795
Preferred Stocks		(1,591,440	)
Common Stocks		(131,997	)
Rights, Warrants and Certificates		(3,162,235	)
Structured Securities		(5,118,148	)
Total	$	(8,598,103	)

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

Distribution of investments representing geographic holdings, as a percentage of total investments at value, is as follows:

Geographic Holdings	Value		Percent
United States	$	1,459,325,704		62.7	%
Brazil		105,338,135		4.5
Mexico		73,287,695		3.2
Indonesia		70,507,170		3.0
Russia		68,431,158		2.9
South Africa		61,644,107		2.7
Turkey		48,871,322		2.1
Japan		45,697,193		2.0
Poland		30,757,036		1.3
Colombia		30,058,184		1.3
Peru		29,343,556		1.3
Venezuela		25,051,324		1.1
Supranational		21,977,462		1.0
Ukraine		21,438,904		0.9
Kazakhstan		19,174,862		0.8
United Kingdom		17,548,593		0.8
Hungary		16,993,020		0.7
Philippines		16,534,138		0.7
Canada		14,905,812		0.6
India		14,575,095		0.6
Argentina		13,200,162		0.6
Italy		11,423,076		0.5
Malaysia		9,438,677		0.4
Australia		8,738,487		0.4
Uruguay		8,540,407		0.4
Germany		7,694,825		0.3
The Netherlands		7,634,515		0.3
Panama		5,888,838		0.3
Israel		5,870,139		0.3
Dominican Republic		5,691,347		0.3
Korea, Republic of South		5,151,009		0.2
France		5,027,561		0.2
Chile		4,984,693		0.2
Spain		4,687,934		0.2
Qatar		4,073,388		0.2
Belgium		3,888,283		0.2
Luxembourg		3,371,471		0.2

34   |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Geographic Holdings Continued	Value		Percent
Sri Lanka	$	3,313,561		0.1	%
Trinidad & Tobago		2,933,350		0.1
Austria		2,820,052		0.1
Ghana		2,692,243		0.1
United Arab Emirates		1,766,050		0.1
Nigeria		1,687,950		0.1
Norway		907,500		—
Denmark		891,607		—
Greece		693,199		—
Finland		612,819		—
Singapore		432,736		—
Ivory Coast		209,575		—
European Union		192,544		—
New Zealand		272		—
Total	$	2,325,918,740		100.0

Foreign Currency Exchange Contracts as of December 30, 2011 are as follows:

		Contract
Counterparty/		Amount		Expiration				Unrealized		Unrealized
Contract Description	Buy/Sell	(000’s)		Dates		Value		Appreciation		Depreciation
Bank of America:
British Pound Sterling (GBP)	Sell	10	GBP		1/25/12	$	15,526	$	42	$	—
Euro (EUR)	Sell	4,585	EUR		1/23/12-1/27/12		5,935,181		357,380		—
Hungarian Forint (HUF)	Sell	1,760,000	HUF		1/11/12		7,221,407		579,323		—
New Turkish Lira (TRY)	Sell	13,320	TRY		4/25/12		6,850,184		110,883		—
Peruvian New Sol (PEN)	Sell	18,570	PEN		1/17/12		6,876,025		—		98,324
Singapore Dollar (SGD)	Buy	7,180	SGD		1/17/12		5,535,324		—		83,269
South African Rand (ZAR)	Sell	118,740	ZAR		2/15/12		14,597,856		161,072		—
South Korean Won (KRW)	Buy	10,249,000	KRW		1/17/12-1/25/12		8,879,720		83,586		—
South Korean Won (KRW)	Sell	1,262,000	KRW		1/25/12		1,093,390		—		1,695
Swedish Krona (SEK)	Sell	4,360	SEK		1/27/12		632,599		3,544		—
Swiss Franc (CHF)	Sell	2,380	CHF		1/27/12		2,535,041		20,499		—
									1,316,329		183,288
Bank of America EM
Colombian Peso (COP)	Buy	294,000	COP		2/1/12		152,392		—		177
Bank Paribas Asia — FGN:
Euro (EUR)	Sell	915	EUR		1/25/12		1,184,440		60,380		—
Swiss Franc (CHF)	Sell	610	CHF		1/25/12		649,714		—		3,297
									60,380		3,297
Barclay’s Capital:
Chilean Peso (CLP)	Sell	330,000	CLP		1/20/12		633,262		—		13,195
Euro (EUR)	Buy	60	EUR		2/1/12		77,672		—		1,925
Euro (EUR)	Sell	3,340	EUR		1/25/12-2/1/12		4,323,560		122,056		—
Hungarian Forint (HUF)	Buy	42,000	HUF		1/11/12		172,329		—		7,134
Hungarian Forint (HUF)	Sell	336,000	HUF		6/12/12		1,356,545		376,754		—
Israeli Shekel (ILS)	Sell	2,030	ILS		4/2/13		530,173		5,744		—
Norwegian Krone (NOK)	Buy	2,600	NOK		2/1/12		434,233		—		13,462
Norwegian Krone (NOK)	Sell	2,300	NOK		1/25/12		384,226		11,948		—
Polish Zloty (PLZ)	Sell	4,060	PLZ		1/11/12-2/1/12		1,174,526		25,929		188
Russian Ruble (RUR)	Buy	3,840	RUR		1/19/12		118,909		—		2,571
Russian Ruble (RUR)	Sell	657,370	RUR		1/11/12-2/2/12		20,341,554		409,075		241,848
Swedish Krona (SEK)	Buy	133,780	SEK		2/1/12-2/10/12		19,398,624		—		888,051
									951,506		1,168,374

35  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENTOF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Foreign Currency Exchange Contracts: Continued

		Contract
Counterparty/		Amount		Expiration				Unrealized		Unrealized
Contract Description	Buy/Sell	(000’s)		Dates		Value		Appreciation		Depreciation
Citigroup:
British Pound Sterling (GBP)	Buy	380	GBP		2/1/12	$	589,960	$	1,491	$	—
Czech Koruna (CZK)	Sell	3,510	CZK		2/1/12		177,703		1,973		—
Euro (EUR)	Sell	12,775	EUR		1/23/12-5/10/12		16,537,568		456,517		—
Hungarian Forint (HUF)	Buy	356,000	HUF		1/11/12		1,460,694		—		64,349
Hungarian Forint (HUF)	Sell	494,000	HUF		1/11/12-6/12/12		2,013,507		270,592		—
Mexican Nuevo Peso (MXN)	Buy	14,200	MXN		1/11/12		1,016,565		—		37,314
Mexican Nuevo Peso (MXN)	Sell	59,100	MXN		1/11/12-2/1/12		4,230,808		97,416		—
New Taiwan Dollar (TWD)	Sell	135,000	TWD		2/8/12		4,462,176		5,064		—
Norwegian Krone (NOK)	Buy	2,300	NOK		1/25/12		384,226		—		27,359
South African Rand (ZAR)	Sell	16,860	ZAR		3/12/12		2,065,196		—		28,098
Swedish Krona (SEK)	Sell	6,800	SEK		2/1/12		986,374		—		15,877
Swiss Franc (CHF)	Sell	520	CHF		1/17/12		553,774		4,004		—
									837,057		172,997
Citigroup EM:
Brazilian Real (BRR)	Buy	7,860	BRR		1/4/12-2/2/12		4,179,040		—		22,820
Brazilian Real (BRR)	Sell	18,980	BRR		1/4/12-2/2/12		10,091,372		55,105		—
Chilean Peso (CLP)	Buy	330,000	CLP		1/20/12		633,262		—		5,653
Colombian Peso (COP)	Sell	4,947,000	COP		2/1/12-2/9/12		2,563,065		893		9,744
Egyptian Pounds (EGP)	Buy	17,580	EGP		2/13/12		2,774,947		—		62,274
Mexican Nuevo Peso (MXN)	Sell	34,200	MXN		1/11/12		2,448,347		—		58,909
									55,998		159,400
Credit Suisse:
Malaysian Ringgit (MYR)	Buy	59,510	MYR		1/31/12		18,730,664		5,058		153,950
New Turkish Lira (TRY)	Sell	4,880	TRY		7/17/13		2,301,945		61,632		—
South African Rand (ZAR)	Sell	107,450	ZAR		1/11/12		13,284,412		—		120,391
Swiss Franc (CHF)	Sell	680	CHF		2/1/12		724,368		17,775		625
									84,465		274,966
Credit Suisse EM
Russian Ruble (RUR)	Buy	13,010	RUR		1/24/12		402,573		—		9,396
Deutsche Bank Capital Corp.:
Australian Dollar (AUD)	Sell	5,245	AUD		1/27/12		5,346,570		61,025		—
Canadian Dollar (CAD)	Buy	210	CAD		1/24/12		206,020		—		1,876
Chinese Renminbi (Yuan) (CNY)	Buy	27,950	CNY		1/6/12		4,440,032		101,794		—
Euro (EUR)	Sell	17,540	EUR		1/25/12		22,705,012		708,376		—
Hungarian Forint (HUF)	Sell	1,025,000	HUF		1/11/12		4,205,649		309,770		—
Mexican Nuevo Peso (MXN)	Sell	800	MXN		2/1/12		57,164		—		1,244
Polish Zloty (PLZ)	Sell	17,210	PLZ		1/11/12		4,981,886		45,162		—
Singapore Dollar (SGD)	Buy	110	SGD		1/17/12		84,803		288		—
South African Rand (ZAR)	Sell	106,440	ZAR		3/12/12		13,037,927		—		85,556
									1,226,415		88,676
Deutsche Bank EM:
Chinese Renminbi (Yuan) (CNY)	Sell	27,950	CNY		1/6/12		4,440,032		—		75,099
Egyptian Pounds (EGP)	Buy	9,810	EGP		1/9/12		1,605,815		—		7,672
Israeli Shekel (ILS)	Sell	3,010	ILS		3/30/12		788,712		11,224		—
Mexican Nuevo Peso (MXN)	Sell	32,570	MXN		3/15/12		2,319,919		27,046		—
New Turkish Lira (TRY)	Buy	31,670	TRY		2/10/12		16,559,943		—		972,165
Singapore Dollar (SGD)	Buy	4,470	SGD		1/17/12		3,446,086		—		65,580
South African Rand (ZAR)	Buy	35,220	ZAR		2/14/12		4,330,538		113,382		—
South Korean Won (KRW)	Buy	3,298,000	KRW		1/25/12		2,857,371		—		28,019
									151,652		1,148,535

36  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Foreign Currency Exchange Contracts: Continued

		Contract
Counterparty/		Amount		Expiration				Unrealized		Unrealized
Contract Description	Buy/Sell	(000’s)		Dates		Value		Appreciation		Depreciation
Goldman Sachs EM:
Brazilian Real (BRR)	Sell	16,530	BRR		2/2/12	$	8,788,745	$	38,554	$	—
Mexican Nuevo Peso (MXN)	Buy	117,800	MXN		1/11/12		8,433,195		—		365,913
Mexican Nuevo Peso (MXN)	Sell	71,200	MXN		1/11/12		5,097,143		—		69,711
New Turkish Lira (TRY)	Buy	13,545	TRY		1/18/12		7,120,647		—		38,822
Polish Zloty (PLZ)	Sell	16,855	PLZ		1/11/12		4,879,122		187,917		—
									226,471		474,446
Goldman, Sachs & Co.:
British Pound Sterling (GBP)	Sell	2,285	GBP		1/27/12-2/1/12		3,547,682		90,107		—
Canadian Dollar (CAD)	Buy	10	CAD		2/1/12		9,809		263		—
Canadian Dollar (CAD)	Sell	130	CAD		2/1/12		127,513		—		3,412
Euro (EUR)	Buy	17,400	EUR		1/27/12-2/10/12		22,526,182		—		1,273,203
Euro (EUR)	Sell	7,459	EUR		1/3/12-2/27/12		9,655,450		289,716		—
Hungarian Forint (HUF)	Buy	288,000	HUF		1/11/12		1,181,685		—		56,877
Hungarian Forint (HUF)	Sell	30,000	HUF		1/11/12		123,092		5,019		—
Japanese Yen (JPY)	Buy	518,000	JPY		1/27/12		6,732,713		—		119,773
Japanese Yen (JPY)	Sell	1,763,000	JPY		1/17/12-2/2/12		22,913,659		—		296,809
Mexican Nuevo Peso (MXN)	Sell	143,650	MXN		1/11/12		10,283,773		245,690		—
New Turkish Lira (TRY)	Buy	15,480	TRY		1/18/12-4/25/12		8,039,285		—		149,828
New Zealand Dollar (NZD)	Buy	230	NZD		2/1/12		178,608		4,411		—
New Zealand Dollar (NZD)	Sell	320	NZD		2/1/12		248,498		—		6,137
Swedish Krona (SEK)	Buy	6,340	SEK		1/25/12		919,981		—		27,065
Swedish Krona (SEK)	Sell	22,920	SEK		1/27/12		3,325,498		28,854		—
Swiss Franc (CHF)	Sell	2,370	CHF		1/27/12		2,524,389		3,239		—
									667,299		1,933,104
HSBC EM
New Turkish Lira (TRY)	Sell	19,280	TRY		1/18/12-7/17/13		9,890,966		270,575		—
JP Morgan Chase:
Australian Dollar (AUD)	Buy	10	AUD		2/1/12		10,188		553		—
Australian Dollar (AUD)	Sell	1,005	AUD		1/18/12-2/1/12		1,025,508		—		4,295
Canadian Dollar (CAD)	Buy	990	CAD		1/18/12		971,373		—		2,599
Canadian Dollar (CAD)	Sell	260	CAD		1/24/12		255,073		4,476		—
Euro (EUR)	Buy	1,905	EUR		1/27/12		2,466,000		—		85,626
Hungarian Forint (HUF)	Buy	1,069,000	HUF		1/11/12		4,386,184		—		9,556
Indian Rupee (INR)	Sell	8,980	INR		1/31/12		167,945		10,761		—
Mexican Nuevo Peso (MXN)	Buy	5,000	MXN		2/1/12		357,274		—		6,396
Mexican Nuevo Peso (MXN)	Sell	3,400	MXN		2/1/12		242,947		4,901		—
Philippines Peso (PHP)	Sell	123,000	PHP		1/23/12		2,801,759		—		9,478
Polish Zloty (PLZ)	Sell	15,140	PLZ		1/11/12		4,382,671		12,449		—
Russian Ruble (RUR)	Sell	3,840	RUR		1/19/12		118,909		642		—
South African Rand (ZAR)	Buy	141,735	ZAR		2/10/12		17,436,978		—		372,283
South Korean Won (KRW)	Sell	1,151,000	KRW		1/25/12		997,221		2,866		—
Swedish Krona (SEK)	Buy	27,280	SEK		1/27/12		3,958,097		—		165,988
									36,648		656,221
JP Morgan EM:
Egyptian Pounds (EGP)	Buy	9,810	EGP		3/5/12		1,534,620		32,323		—
Egyptian Pounds (EGP)	Sell	9,810	EGP		1/9/12		1,605,815		7,672		—
Indonesia Rupiah (IDR)	Sell	53,215,000	IDR		3/19/12		5,821,881		—		53,317
South Korean Won (KRW)	Buy	334,000	KRW		1/25/12		289,376		—		5,157
									39,995		58,474

37 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Foreign Currency Exchange Contracts: Continued

		Contract
Counterparty/		Amount		Expiration				Unrealized		Unrealized
Contract Description	Buy/Sell	(000’s)		Dates		Value		Appreciation		Depreciation
Nomura Securities:
British Pound Sterling (GBP)	Buy	1,645	GBP		1/23/12-2/1/12	$	2,554,107	$	—	$	2,995
British Pound Sterling (GBP)	Sell	830	GBP		1/25/12-2/1/12		1,288,637		10,217		213
Euro (EUR)	Sell	10,040	EUR		1/17/12		12,995,766		304,774		—
Hong Kong Dollar (HKD)	Sell	34,600	HKD		1/17/12		4,455,169		—		7,711
Indian Rupee (INR)	Buy	241,980	INR		1/31/12-2/8/12		4,519,169		—		133,546
Japanese Yen (JPY)	Buy	286,000	JPY		1/25/12		3,717,174		16,084		1,005
New Zealand Dollar (NZD)	Buy	320	NZD		2/1/12		248,498		6,967		—
New Zealand Dollar (NZD)	Sell	3,655	NZD		1/27/12-2/1/12		2,839,195		81,792		12,020
Norwegian Krone (NOK)	Buy	101,710	NOK		2/1/12-2/10/12		16,980,989		14		1,118,729
Norwegian Krone (NOK)	Sell	300	NOK		2/1/12		50,104		1,846		—
Singapore Dollar (SGD)	Sell	5,730	SGD		2/2/12		4,417,268		51,527		—
South Korean Won (KRW)	Buy	1,151,000	KRW		1/25/12		997,221		1,976		—
South Korean Won (KRW)	Sell	71,000	KRW		1/17/12		61,552		838		—
Swiss Franc (CHF)	Buy	435	CHF		5/10/12		464,598		—		21,811
Swiss Franc (CHF)	Sell	1,190	CHF		1/25/12		1,267,474		—		6,271
									476,035		1,304,301
RBS Greenwich Capital
Czech Koruna (CZK)	Sell	81,600	CZK		1/17/12		4,130,695		233,991		—
State Street
New Turkish Lira (TRY)	Buy	8,190	TRY		1/13/12		4,310,853		—		234,450
UBS Inv Bank EM
Polish Zloty (PLZ)	Buy	57,450	PLZ		2/10/12		16,582,128		—		1,483,910
Westpac:
Australian Dollar (AUD)	Buy	1,475	AUD		1/18/12-2/1/12		1,504,329		19,783		—
Australian Dollar (AUD)	Sell	1,095	AUD		1/17/12-2/1/12		1,116,992		—		26,330
British Pound Sterling (GBP)	Sell	1,440	GBP		1/17/12		2,235,949		10,944		—
Canadian Dollar (CAD)	Buy	1,630	CAD		1/24/12-2/1/12		1,598,982		4,806		4,509
Canadian Dollar (CAD)	Sell	3,745	CAD		1/17/12-2/1/12		3,674,478		—		24,893
Japanese Yen (JPY)	Buy	42,000	JPY		2/1/12		545,942		3,554		193
New Zealand Dollar (NZD)	Buy	150	NZD		2/1/12		116,484		117		—
									39,204		55,925
Total unrealized appreciation and depreciation								$	6,674,020	$	9,409,937

Futures Contracts as of December 30, 2011 are as follows:

								Unrealized
		Number of		Expiration				Appreciation
Contract Description	Buy/Sell	Contracts		Date		Value		(Depreciation)
DAX Index	Sell		20		3/16/12	$	3,818,029	$	(48,269	)
Euro-Bundesobligation	Buy		26		3/8/12		4,678,755		148,703
Euro-Bundesobligation	Sell		43		3/8/12		6,962,700		(118,957	)
Euro-Bundesobligation	Sell		67		3/8/12		12,056,792		(245,800	)
Euro-Schatz	Sell		44		3/8/12		6,283,518		(21,405	)
FTSE 100 Index	Buy		9		3/16/12		773,761		6,509
FTSE 100 Index	Sell		73		3/16/12		6,276,059		(89,048	)
Japan (Government of) Mini Bonds, 10 yr.	Buy		40		3/8/12		7,406,002		27,324
NASDAQ 100 Index	Sell		165		3/16/12		7,505,850		(4,006	)
NIKKEI 225 Index	Buy		14		3/8/12		769,391		2,043
NIKKEI 225 Index	Sell		61		3/8/12		6,696,765		148,275
Standard & Poor’s 500 E-Mini Index	Sell		298		3/16/12		18,663,740		(349,170	)
U.S. Long Bonds	Buy		476		3/21/12		68,930,750		605,274

38  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Futures Contracts: Continued

								Unrealized
		Number of		Expiration				Appreciation
Contract Description	Buy/Sell	Contracts		Date		Value		(Depreciation)
U.S. Treasury Nts., 2 yr.	Buy		382		3/30/12	$	84,248,907	$	11,596
U.S. Treasury Nts., 2 yr.	Sell		157		3/30/12		34,625,860		(9,109	)
U.S. Treasury Nts., 5 yr.	Buy		1,206		3/30/12		148,648,922		712,535
U.S. Treasury Nts., 5 yr.	Sell		71		3/30/12		8,751,305		(35,570	)
U.S. Treasury Nts., 10 yr.	Buy		1,052		3/21/12		137,943,500		1,454,392
U.S. Treasury Nts., 10 yr.	Sell		465		3/21/12		60,973,125		(316,664	)
U.S. Treasury Ultra Bonds	Buy		197		3/21/12		31,556,938		191,835
United Kingdom Long Gilt	Sell		8		3/28/12		1,452,976		(20,523	)
								$	2,049,965

Written Options as of December 30, 2011 are as follows:

														Unrealized
		Number of		Exercise			Expiration		Premiums					Appreciation/
Description	Type	Contracts		Price			Date		Received		Value			(Depreciation)
Australian Dollar (AUD)	Put		2,930,000	$	0.920			1/13/12	$	50,007	$	(3	)	$	50,004
Australian Dollar (AUD)	Put		1,905,000		0.959			1/13/12		40,005		(279	)		39,726
Australian Dollar (AUD)	Put		1,905,000		0.949			1/13/12		38,083		(97	)		37,986
Australian Dollar (AUD)	Put		950,000		0.923			1/17/12		16,948		(12	)		16,936
Australian Dollar (AUD) Futures	Put		144		93.000			1/9/12		54,429		(720	)		53,709
Australian Dollar (AUD) Futures	Put		97		97.000			1/9/12		1,269		(1,455	)		(186	)
Euro (EUR)	Call		950,000		1.450			1/13/12		15,690		—			15,690
Euro (EUR)	Put		955,000		1.290			1/18/12		17,802		(11,775	)		6,027
Euro (EUR) 90 Day Futures	Put		359		98.625			2/13/12		17,536		(2,244	)		15,292
Euro (EUR) 90 Day Futures	Put		179		98.750			1/16/12		8,744		(1,119	)		7,625
Euro (EUR) FX Futures	Put		72		1.210			3/12/12		92,735		(76,500	)		16,235
Euro-Bundesobligation Futures	Call		272	142.000		EUR		1/30/12		149,532		(123,212	)		26,320
Euro-Bundesobligation Futures	Call		131	141.000		EUR		1/30/12		89,508		(100,032	)		(10,524	)
Euro-Bundesobligation Futures	Call		96	141.000		EUR		2/27/12		136,921		(144,127	)		(7,206	)
Euro-Bundesobligation Futures	Call		337	140.000		EUR		2/27/12		440,769		(676,050	)		(235,281	)
Euro-Bundesobligation Futures	Put		968	131.000		EUR		1/30/12		288,529		(50,113	)		238,416
Euro-Bundesobligation Futures	Put		194	130.500		EUR		2/27/12		93,545		(37,663	)		55,882
Euro-Bundesobligation Futures	Put		145	133.000		EUR		1/30/12		71,810		(18,767	)		53,043
Indonesia Rupiah (IDR)	Call		57,400,000,000	8,650.000		IDR		1/27/12		51,230		(574	)		50,656
Indonesia Rupiah (IDR)	Call		28,700,000,000	8,650.000		IDR		1/27/12		25,283		(287	)		24,996
Indonesia Rupiah (IDR)	Call		28,500,000,000	8,600.000		IDR		1/30/12		20,050		(285	)		19,765
Indonesia Rupiah (IDR)	Put		66,500,000,000	10,020.000		IDR		1/27/12		56,744		(5,320	)		51,424
Indonesia Rupiah (IDR)	Put		33,200,000,000	10,000.000		IDR		1/27/12		29,116		(2,988	)		26,128
Indonesia Rupiah (IDR)	Put		33,000,000,000	9,950.000		IDR		1/30/12		23,879		(4,620	)		19,259
Japanese Yen (JPY) Futures	Call		59		140.000			3/12/12		19,883		(13,275	)		6,608
Japanese Yen (JPY) Futures	Call		10		139.000			3/12/12		2,475		(2,875	)		(400	)
Japanese Yen (JPY) Futures	Call		5		140.500			3/12/12		8,552		(1,000	)		7,552
Japanese Yen (JPY) Futures	Put		59		121.000			3/12/12		12,167		(12,538	)		(371	)
Japanese Yen (JPY) Futures	Put		48		124.000			1/9/12		4,823		(1,200	)		3,623
Japanese Yen (JPY) Futures	Put		48		125.500			1/9/12		4,139		(2,100	)		2,039
Japanese Yen (JPY) Futures	Put		48		117.000			3/12/12		8,939		(3,600	)		5,339
Japanese Yen (JPY) Futures	Put		39		123.000			2/6/12		7,750		(3,900	)		3,850
Japanese Yen (JPY) Futures	Put		29		120.000			3/12/12		6,091		(4,713	)		1,378
Japanese Yen (JPY) Futures	Put		17		123.000			1/9/12		1,291		(213	)		1,078
Japanese Yen (JPY) Futures	Put		5		126.000			1/9/12		1,302		(250	)		1,052
Mexican Nuevo Peso (MXN)	Call		61,760,000	12.330 MXN				1/18/12		87,105		(1	)		87,104
Mexican Nuevo Peso (MXN)	Call		61,680,000	12.315 MXN				1/18/12		55,094		(1	)		55,093
Mexican Nuevo Peso (MXN)	Put		70,120,000	14.000 MXN				1/18/12		104,178		(61,107	)		43,071
Mexican Nuevo Peso (MXN)	Put		70,120,000	14.000 MXN				1/18/12		84,044		(61,107	)		22,937
New Zealand Dollar (NZD)	Put		2,860,000		0.753			1/13/12		42,613		(3,548	)		39,065
New Zealand Dollar (NZD)	Put		2,855,000		0.740			1/17/12		39,485		(1,973	)		37,512
New Zealand Dollar (NZD)	Put		2,800,000		0.737			1/17/12		37,326		(1,446	)		35,880

39  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Written Options: Continued

														Unrealized
		Number of		Exercise			Expiration		Premiums					Appreciation/
Description	Type	Contracts		Price			Date		Received		Value			(Depreciation)
South Korean Won (KRW)	Call		1,147,000,000	1,050.000		KRW		1/19/12	$	6,751	$	—		$	6,751
South Korean Won (KRW)	Put		1,385,000,000	1,272.000		KRW		1/19/12		23,606		(152	)		23,454
U.S. Long Bonds Futures	Call		772		150.000			2/27/12		898,920		(844,375	)		54,545
U.S. Treasury Nts. Futures, 10 yr.	Put		941		126.000			1/30/12		67,780		(29,406	)		38,374
U.S. Treasury Nts. Futures, 10 yr.	Put		609		126.500			1/30/12		45,331		(19,031	)		26,300
U.S. Treasury Nts. Futures, 10 yr.	Put		468		127.000			1/30/12		28,604		(21,938	)		6,666
U.S. Treasury Nts. Futures, 10 yr.	Put		179		124.500			2/27/12		36,190		(13,984	)		22,206
U.S. Treasury Nts. Futures, 10 yr.	Put		18		126.000			2/27/12		7,850		(2,250	)		5,600
									$	3,472,453	$	(2,364,225	)	$	1,108,228

Exercise price is reported in U.S. Dollars (USD), except for those denoted in the following currency:

EUR	Euro	KRW	South Korean Won
IDR	Indonesia Rupiah	MXN	Mexican Nuevo Peso

Credit Default Swap Contracts as of December 30, 2011 are as follows:

				Pay/					Upfront
	Buy/Sell	Notional		Receive					Payment						Unrealized
Reference Entity/	Credit	Amount		Fixed			Termination		Received/						Appreciation
Swap Counterparty	Protection	(000’s)		Rate			Date		(Paid)			Value			(Depreciation)
Brazil (Federative Republic of)
Barclays Bank plc	Sell	$	3,800		1.00	%		3/20/17	$	113,422		$	(112,729	)	$	693
	Total		3,800							113,422			(112,729	)		693
Bristol-Myers Squibb Co.
Citibank NA	Sell		4,480		1.00			12/20/16		(152,683	)		138,840			(13,843	)
	Total		4,480							(152,683	)		138,840			(13,843	)
CDX Emerging Market Index, Series 16:
Bank of America NA	Buy		10,735		5.00			12/20/16		966,568			(927,549	)		39,019
Barclays Bank plc	Buy		10,525		5.00			12/20/16		943,449			(909,404	)		34,045
	Total		21,260							1,910,017			(1,836,953	)		73,064
Gatx Corp.
UBS AG	Sell		4,480		1.00			12/20/16		238,374			(236,513	)		1,861
	Total		4,480							238,374			(236,513	)		1,861
Goodrich Corp.
Deutsche Bank AG	Sell		4,510		1.00			12/20/16		(166,825	)		167,625			800
	Total		4,510							(166,825	)		167,625			800
Halliburton Co.
Credit Suisse International	Buy		4,480		1.00			12/20/16		13,499			5,177			18,676
	Total		4,480							13,499			5,177			18,676
Hewlett-Packard Co.
Credit Suisse International	Buy		4,480		1.00			12/20/16		(83,398	)		99,384			15,986
	Total		4,480							(83,398	)		99,384			15,986
Hungary (Republic of)
HSBC Bank USA NA	Sell		2,960		1.00			3/20/17		602,512			(664,578	)		(62,066	)
	Total		2,960							602,512			(664,578	)		(62,066	)
Ingersoll-Rand Co.
Deutsche Bank AG	Buy		4,510		1.00			12/20/16		117,936			(135,679	)		(17,743	)
	Total		4,510							117,936			(135,679	)		(17,743	)

40  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Credit Default Swap Contracts: Continued

				Pay/					Upfront
	Buy/Sell	Notional		Receive					Payment						Unrealized
Reference Entity/	Credit	Amount		Fixed			Termination		Received/						Appreciation
Swap Counterparty	Protection	(000’s)		Rate			Date		(Paid)			Value			(Depreciation)
Istanbul Bond Co. SA for Finansbank AS
Morgan Stanley Capital Services, Inc.	Sell	$	3,100		1.30	%		3/24/13	$	—		$	(134,878	)	$	(134,878	)
	Total		3,100							—			(134,878	)		(134,878	)
Japan:
JPMorgan Chase Bank NA	Sell		470		1.00			9/20/16		1,824			(8,343	)		(6,519	)
JPMorgan Chase Bank NA	Sell		475		1.00			9/20/16		1,646			(8,432	)		(6,786	)
JPMorgan Chase Bank NA	Sell		475		1.00			9/20/16		2,505			(8,432	)		(5,927	)
	Total		1,420							5,975			(25,207	)		(19,232	)
McDonald’s Corp.
Deutsche Bank AG	Sell		4,480		1.00			12/20/16		(179,909	)		166,821			(13,088	)
	Total		4,480							(179,909	)		166,821			(13,088	)
Peru (Republic of):
Citibank NA	Buy		10,000		1.00			9/20/15		11,275			171,709			182,984
Deutsche Bank AG	Buy		1,900		1.71			12/20/16		—			(1,865	)		(1,865	)
	Total		11,900							11,275			169,844			181,119
Philippines (Republic of the)
Barclays Bank plc	Buy		12,430		1.00			3/20/17		(612,768	)		565,604			(47,164	)
	Total		12,430							(612,768	)		565,604			(47,164	)
Reynolds American, Inc.
Goldman Sachs International	Sell		4,510		1.00			12/20/16		186,191			(189,589	)		(3,398	)
	Total		4,510							186,191			(189,589	)		(3,398	)
Southwest Airlines Co.
Goldman Sachs International	Buy		4,480		1.00			12/20/16		(198,445	)		187,598			(10,847	)
	Total		4,480							(198,445	)		187,598			(10,847	)
Whirlpool Corp.
Barclays Bank plc	Buy		4,590		1.00			12/20/16		(335,439	)		415,460			80,021
	Total		4,590							(335,439	)		415,460			80,021
Grand Total Buys										822,677			(529,565	)		293,112
Grand Total Sells										647,057			(890,208	)		(243,151	)
Total Credit Default Swaps									$	1,469,734		$	(1,419,773	)	$	49,961

The table that follows shows the undiscounted maximum potential payment by the Fund related to selling credit protection in credit default swaps:

Type of Reference	Total Maximum Potential				Reference Asset
Asset on which the	Payments for Selling Credit				Rating Range**
Fund Sold Protection	Protection (Undiscounted)		Amount Recoverable*		(Unaudited)
Investment Grade Single Name Corporate Debt	$	25,560,000	$	—	A+ to BBB-
Investment Grade Sovereign Debt		5,220,000		—	AA- to BBB-
Non-Investment Grade Sovereign Debt		2,960,000		—	BB-
Total	$	33,740,000	$	—

*	The Fund has no amounts recoverable from related purchased protection. In addition, the Fund has no recourse provisions under the credit derivatives and holds no collateral which can offset or reduce potential payments under a triggering event.
**	The period end reference asset security ratings, as rated by any rating organization, are included in the equivalent Standard & Poor’s rating category. The reference asset rating represents the likelihood of a potential credit event on the reference asset which would result in a related payment by the Fund.

41  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Interest Rate Swap Contracts as of December 30, 2011 are as follows:

Notional

Interest Rate/

Amount

Paid by

Received by

Termination

Swap Counterparty

(000’s)

the Fund

the Fund

Date

Value

BZDI:

Citibank NA

9,670 BRR

BZDI

11.540

%

1/2/14

$

90,683

Goldman Sachs Group, Inc. (The)

10,600 BRR

BZDI

11.390

/5/15

101,156

Goldman Sachs Group, Inc. (The)

8,670 BRR

BZDI

11.520

1/2/14

86,153

Goldman Sachs Group, Inc. (The)

9,900 BRR

BZDI

11.420

1/3/14

87,081

Total

38,840 BRR

365,073

MXN TIIE BANXICO:

Bank of America NA

114,400 MXN

MXN TIIE BANXICO

5.170

11/14/14

(60,944

)

Bank of America NA

84,200 MXN

MXN TIIE BANXICO

5.130

11/19/14

(38,707

)

Barclays Bank plc

33,700 MXN

MXN TIIE BANXICO

5.150

11/20/14

(14,241

)

Credit Suisse International

13,300 MXN

MXN TIIE BANXICO

7.010

7/24/31

(91,257

)

Credit Suisse International

67,400 MXN

MXN TIIE BANXICO

5.120

11/19/14

(32,307

)

Deutsche Bank AG

66,000 MXN

MXN TIIE BANXICO

5.120

11/19/14

(31,636

)

Goldman Sachs Group, Inc. (The)

10,300 MXN

MXN TIIE BANXICO

7.000

7/24/31

(71,452

)

Goldman Sachs Group, Inc. (The)

73,700 MXN

MXN TIIE BANXICO

5.000

11/14/14

(51,829

)

Merrill Lynch & Co., Inc.

17,000 MXN

MXN TIIE BANXICO

6.990

7/24/31

(119,215

)

Total

480,000 MXN

(511,588

)

Six-Month AUD BBR BBSW

Six-Month AUD

Westpac Banking Corp.

10,670 AUD

4.990

%

BBR BBSW

11/3/21

(360,873

)

Six-Month EUR EURIBOR:

Six-Month EUR

Bank of America Merrill Lynch

500 EUR

EURIBOR

2.710

8/22/21

20,922

Six-Month EUR

Bank of America NA

470 EUR

EURIBOR

1.945

9/8/16

7,135

Six-Month EUR

Bank of America NA

1,440 EUR

EURIBOR

1.890

10/6/16

15,936

Six-Month EUR

Barclays Bank plc

2,965 EUR

EURIBOR

2.580

11/22/17

55,603

Six-Month EUR

Barclays Bank plc

2,300 EUR

EURIBOR

2.520

12/13/17

33,767

Six-Month EUR

Deutsche Bank AG

4,850 EUR

EURIBOR

1.395

12/2/13

6,588

Six-Month EUR

Goldman Sachs Group, Inc. (The)

390 EUR

EURIBOR

2.840

10/10/31

11,595

Six-Month EUR

Goldman Sachs Group, Inc. (The)

1,770 EUR

EURIBOR

2.735

11/24/17

18,738

Six-Month EUR

Goldman Sachs Group, Inc. (The)

3,880 EUR

EURIBOR

2.160

12/2/15

40,997

Six-Month EUR

Goldman Sachs Group, Inc. (The)

475 EUR

EURIBOR

2.990

8/11/21

35,737

Six-Month EUR

JPMorgan Chase Bank NA

1,915 EUR

EURIBOR

1.860

11/3/16

16,243

Total

20,955 EUR

263,261

Six-Month PLZ WIBOR WIBO:

Six-Month PLZ

JPMorgan Chase Bank NA

10,980 PLZ

4.575

WIBOR WIBO

8/23/16

31,098

Six-Month PLZ

JPMorgan Chase Bank NA

10,980 PLZ

4.590

WIBOR WIBO

8/23/16

28,985

Total

21,960 PLZ

60,083

42  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Interest Rate Swap Contracts: Continued

	Notional
Interest Rate/	Amount			Paid by			Received by			Termination
Swap Counterparty	(000’s)			the Fund			the Fund			Date		Value
Three-Month CAD BA CDOR:
							Three-Month
Bank of America Merrill Lynch	2,840		CAD		1.183	%	CAD BA CDOR				8/18/14	$	(1,818	)
							Three-Month
JPMorgan Chase Bank NA	3,845		CAD		1.320		CAD BA CDOR				8/8/14		(12,264	)
							Three-Month
JPMorgan Chase Bank NA	3,865		CAD		1.585		CAD BA CDOR				8/4/14		(32,678	)
Total	10,550		CAD										(46,760	)
Three-Month NZD BBR FRA
				Three-Month
Barclays Bank plc	13,915		NHZ	NZD BBR FRA				4.600	%		11/3/21		549,297
Three-Month SEK STIBOR SIDE
							Three-Month
Goldman Sachs Group, Inc. (The)	72,770		SEK		2.440		SEK STIBOR SIDE				11/3/21		(147,775	)
Three-Month USD BBA LIBOR
				Three-Month USD
Barclays Bank plc		11,300		BBA LIBOR				2.358			11/2/21		385,933
Three-Month ZAR JIBAR SAFEX:
							Three-Month
Barclays Bank plc	91,000		ZAR		6.110		ZAR JIBAR SAFEX				12/8/14		10,091
Total where Fund pays a fixed rate	91,000		ZAR										10,091
				Three-Month ZAR
Barclays Bank plc	34,900		ZAR	JIBAR SAFEX				7.510			12/7/21		(15,471	)
				Three-Month ZAR
Barclays Bank plc	13,300		ZAR	JIBAR SAFEX				7.480			8/17/21		(5,712	)
				Three-Month ZAR
Goldman Sachs Group, Inc. (The)	13,500		ZAR	JIBAR SAFEX				7.480			8/17/21		(5,798	)
				Three-Month ZAR
HSBC Bank USA NA	13,300		ZAR	JIBAR SAFEX				7.470			8/17/21		(6,874	)
Total where Fund pays a variable rate		75,000											(33,855	)
Total	166,000		ZAR										(23,764	)
Total Interest Rate Swaps												$	532,887

Notional amount is reported in U.S. Dollars (USD), except for those denoted in the following currencies:

AUD	Australian Dollar
BRR	Brazilian Real
CAD	Canadian Dollar
EUR	Euro
MXN	Mexican Nuevo Peso
NZD	New Zealand Dollar
PLZ	Polish Zloty
SEK	Swedish Krona
ZAR	South African Rand

Abbreviations/Definitions are as follows:

BA CDOR	Canada Bankers Acceptances Deposit Offering Rate
BANIXCO	Banco de Mexico
BBA LIBOR	British Bankers’ Association London-Interbank Offered Rate
BBR BBSW	Bank Bill Swap Reference Rate
	(Australian Financial Market)
BBR FRA	Bank Bill Rate Forward Rate Agreement
BZDI	Brazil Interbank Deposit Rate
EURIBOR	Euro Interbank Offered Rate
JIBAR	South Africa Johannesburg Interbank Agreed Rate
SAFEX	South African Futures Exchange
STIBOR SIDE	Stockholm Interbank Offered Rate
TIIE	Interbank Equilibrium Interest Rate
WIBOR WIBO	Poland Warsaw Interbank Offer Bid Rate

43 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Total Return Swap Contracts as of December 30, 2011 are as follows:

	Notional
Reference Entity/	Amount			Paid by	Received by	Termination
Swap Counterparty	(000’s)			the Fund	the Fund	Date	Value
Consumer Staples Select Sector Index
Morgan Stanley	$	1,738		One-Month USD BBA LIBOR plus 15 basis points and if negative, the absolute value of the Total Return of the Consumer Staples Select Sector Index	If positive, the Total Return of the Consumer Staples Select Sector Index	3/6/12	$	47,668
Custom Basket of Securities:
Citibank NA	1,813		CHF	One-Month CHF BBA LIBOR plus 30 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/11/12		14,438
Citibank NA	6,030		SEK	One-Month SEK STIBOR SIDE plus 30 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/11/12		5,200
Citibank NA	2,388		EUR	One-Month EURIBOR plus 30 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/11/12		35,226
Citibank NA	1,717		GBP	One-Month GBP BBA LIBOR plus 30 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/11/12		(65,033	)
Citibank NA	986		DKK	One-Month DKK BBA LIBOR plus 30 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/11/12		10,639
Citibank NA	525,530		JPY	One-Month JPY BBA LIBOR plus 53 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	4/16/12		(114,270	)

44  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Total Return Swap Contracts: Continued

	Notional
Reference Entity/	Amount			Paid by	Received by	Termination
Swap Counterparty	(000’s)			the Fund	the Fund	Date	Value
Custom Basket of Securities: Continued
Goldman Sachs Group, Inc. (The)	$	22,387		One-Month USD BBA LIBOR plus 35 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	12/6/12	$	598,976
Morgan Stanley	4,326		GBP	One-Month GBP BBA LIBOR plus 50 basis points and if negative, the absolute value of the Total Return of a custom basket of securities	If positive, the Total Return of a custom basket of securities	1/1/12		(88,542	)
					Reference Entity Total			396,634
Energy Select Sector Index
UBS AG		1,878		One-Month USD BBA LIBOR plus 3 basis points and if negative, the absolute value of the Total Return of the Energy Select Sector Index	If positive, the Total Return of the Energy Select Sector Index	12/6/12		(37,241	)
Industrial Select Sector Index
UBS AG		1,724		One-Month USD BBA LIBOR plus 15 basis points and if negative, the absolute value of the Total Return of the Industrial Select Sector Index	If positive, the Total Return of the Industrial Select Sector Index	9/7/12		9,154
MSCI Daily TR Gross EAFE USD Index:
Citibank NA		252		If positive, the Total Return of the MSCI Daily Gross EAFE USD Index	One-Month USD BBA LIBOR plus 15 basis points and if negative, the Total Return of the MSCI Daily Gross EAFE USD Index	1/9/12		2,068
Goldman Sachs Group, Inc. (The)		889		If positive, the Total Return of the MSCI Daily Gross EAFE USD Index	One-Month USD BBA LIBOR plus 10 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Gross EAFE USD Index	7/10/12		21,804

45  |  OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Total Return Swap Contracts: Continued

	Notional
Reference Entity/	Amount			Paid by	Received by	Termination
Swap Counterparty	(000’s)			the Fund	the Fund	Date	Value
MSCI Daily TR Gross EAFE USD Index: Continued
Goldman Sachs Group, Inc. (The)	$	3,461		If positive, the Total Return of the MSCI Daily Gross EAFE USD Index	One-Month USD BBA LIBOR plus 20 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Gross EAFE USD Index	5/10/12	$	50,532
Goldman Sachs Group, Inc. (The)		2,875		If positive, the Total Return of the MSCI Daily Gross EAFE USD Index	One-Month USD BBA LIBOR plus 28 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Gross EAFE USD Index	9/7/12		53,935
UBS AG		6,044		If positive, the Total Return of the MSCI Daily Gross EAFE USD Index	One-Month USD BBA LIBOR minus 10 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Gross EAFE USD Index	10/9/12		83,116
Reference Entity Total								211,455
MSCI Daily TR Gross Europe Euro Index:
Citibank NA	2,112		EUR	If positive, the Total Return of the MSCI Daily Gross Europe Euro Index	One-Month EUR EURIBOR minus 20 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Gross Europe Euro Index	1/6/12		(34,706	)
Goldman Sachs Group, Inc. (The)	3,341		EUR	If positive, the Total Return of the MSCI Daily Gross Europe Euro Index	One-Month EUR EURIBOR and if negative, the absolute value of the Total Return of the MSCI Daily Gross Europe Euro Index	1/12/12		(68,066	)
Goldman Sachs Group, Inc. (The)	331		EUR	If positive, the Total Return of the MSCI Daily Gross Europe Euro Index	One-Month EUR EURIBOR and if negative, the Total Return of the MSCI Daily Gross Europe Euro Index	1/12/12		(7,306	)
Reference Entity Total								(110,078	)

46 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Total Return Swap Contracts: Continued

	Notional
Reference Entity/	Amount		Paid by	Received by	Termination
Swap Counterparty	(000’s)		the Fund	the Fund	Date	Value
MSCI Daily TR Net Emerging Markets USD Index
Goldman Sachs Group, Inc. (The)	$	5,647	If positive, the Total Return of the MSCI Daily Net Emerging Markets USD Index	One-Month USD BBA LIBOR plus 20 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Emerging Markets USD Index	12/13/12	$	282,433
MSCI Daily TR Net France USD Index:
Goldman Sachs Group, Inc. (The)		2,040	One-Month USD BBA LIBOR minus 65 basis points and if negative, the absolute value of the MSCI Daily Net France USD Index	If positive, the Total Return of the MSCI Daily Net France USD Index	7/6/12		(37,305	)
Goldman Sachs Group, Inc. (The)		291	One-Month USD BBA LIBOR minus 65 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net France USD Index	If positive, the Total Return of the MSCI Daily Net France USD Index	7/6/12		(8,075	)
Goldman Sachs Group, Inc. (The)		171	One-Month USD BBA LIBOR minus 65 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net France USD Index	If positive, the Total Return of the MSCI Daily Net France USD Index	7/6/12		(3,862	)
Goldman Sachs Group, Inc. (The)		199	One-Month USD BBA LIBOR minus 65 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net France USD Index	If positive, the Total Return of the MSCI Daily Net France USD Index	7/6/12		(4,125	)
Reference Entity Total							(53,367	)
MSCI Daily TR Net Germany USD Index
Morgan Stanley		2,226	One-Month USD BBA LIBOR minus 10 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Germany USD Index	If positive, the Total Return of the MSCI Daily Net Germany USD Index	12/6/12		(127,927	)

47 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Total Return Swap Contracts: Continued

	Notional
Reference Entity/	Amount		Paid by	Received by	Termination
Swap Counterparty	(000’s)		the Fund	the Fund	Date	Value
MSCI Daily TR Net Hong Kong USD Index
UBS AG	$	1,883	One-Month USD BBA LIBOR plus 30 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Hong Kong USD Index	If positive, the Total Return of the MSCI Daily Net Hong Kong USD Index	10/9/12	$	(42,925	)
MSCI Daily TR Net Italy USD Index
Morgan Stanley		2,241	One-Month USD BBA LIBOR minus 20 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Italy USD Index	If positive, the Total Return of the MSCI Daily Net Italy USD Index	12/6/12		(98,280	)
MSCI Daily TR Net Spain USD Index:
Morgan Stanley		165	One-Month USD BBA LIBOR minus 2 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Spain USD Index	If positive, the Total Return of the MSCI Daily Net Spain USD Index	9/12/12		(5,279	)
Morgan Stanley		2,341	One-Month USD BBA LIBOR minus 2 basis points and if negative, the absolute value of the Total Return of the MSCI Daily Net Spain USD Index	If positive, the Total Return of the MSCI Daily Net Spain USD Index	9/12/12		(65,864	)
Reference Entity Total							(71,143	)
S&P 400 Midcap Index
BNP Paribas		5,650	One-Month USD BBA LIBOR minus 6 basis points and if negative, the absolute value of the Total Return of the S&P 400 Midcap Index	If positive, the Total Return of the S&P 400 Midcap Index	12/6/12		(37,019	)
Total of Total Return Swaps						$	369,364

Notional amount is reported in U.S. Dollars (USD), except for those denoted in the following currencies:

CHF	Swiss Franc
DKK	Danish Krone
EUR	Euro
GBP	British Pounds Sterling
JPY	Japanese Yen
SEK	Swedish Krona
Abbreviations are as follows:
BBA LIBOR	British Bankers’ Association London-Interbank Offered Rate
EAFE	Europe, Australasia, Far East
EURIBOR	Euro Interbank Offered Rate
MSCI	Morgan Stanley Capital International
S&P	Standard & Poor’s
STIBOR SIDE	Stockholm Interbank Offered Rate
TR	Total Return

48 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Currency Swaps as of December 30, 2011 are as follows:

	Notional
Reference Entity/	Amount		Paid by	Received by	Termination
Swap Counterparty	(000’s)		the Fund	the Fund	Date	Value
Six-Month EUR EURIBOR
Credit Suisse International	$	1,100	Six-Month EUR EURIBOR plus 80 basis points on 843,882 EUR	2.950% on 1,100,000 USD	10/15/17	$	(573	)

Abbreviations/Definitions are as follows:

EUR	Euro
EURIBOR	Euro Interbank Offered Rate

Volatility Swaps as of December 30, 2011 are as follows:

	Notional
Reference Entity/	Amount	Paid by	Received by			Termination
Swap Counterparty	(000’s)	the Fund	the Fund			Date	Value
AUD/CAD Spot Exchange Rate
Goldman Sachs Group, Inc. (The)	13 AUD	The Historic Volatility of the mid AUD/CAD spot exchange rate during the period 12/29/11-2/1/12		8.750	%	2/3/12	$	(13,696	)
AUD/NZD Spot Exchange Rate
Goldman Sachs Group, Inc. (The)	12 AUD	The Historic Volatility of the mid AUD/NZD spot exchange rate during the period 12/30/11-2/2/12		6.300		2/6/12		(9,708	)
EUR/CAD Spot Exchange Rate
Credit Suisse International	10 EUR	The Historic Volatility of the mid EUR/CAD spot exchange rate during the period 12/27/11-1/26/12		8.200		1/30/12		(12,256	)
EUR/JPY Spot Exchange Rate:
Goldman Sachs Group, Inc. (The)	10 EUR	The Historic Volatility of the mid EUR/JPY spot exchange rate during the period 12/6/11-1/5/12		14.250		1/9/12		58,327
Goldman Sachs Group, Inc. (The)	9 EUR	The Historic Volatility of the mid EUR/JPY spot exchange rate during the period 12/5/11-1/5/12		14.250		1/9/12		56,469
JPMorgan Chase Bank NA	10 EUR	The Historic Volatility of the mid EUR/JPY spot exchange rate during the period 12/7/11-1/5/12		14.300		1/10/12		56,763
Reference Entity Total								171,559

49 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Volatility Swaps: Continued

	Notional
Reference Entity/	Amount			Paid by	Received by			Termination
Swap Counterparty	(000’s)			the Fund	the Fund			Date	Value
EUR/USD Spot Exchange Rate:
Goldman Sachs Group, Inc. (The)	$	13		The Historic Volatility of the mid EUR/USD spot exchange rate during the period 12/8/11-1/10/12		14.650	%	1/12/12	$	48,608
Goldman Sachs Group, Inc. (The)		13		The Historic Volatility of the mid EUR/USD spot exchange rate during the period 12/1/11-1/3/12		14.550		1/15/12		64,415
JPMorgan Chase Bank NA		13		The Historic Volatility of the mid EUR/USD spot exchange rate during the period 12/9/11-1/11/12		14.400		1/13/12		39,188
Reference Entity Total										152,211
GBP/CAD Spot Exchange Rate:
Credit Suisse International	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/14/11-1/13/12		9.700		1/17/12		14,997
Deutsche Bank AG	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/20/11-1/19/12		8.500		1/23/12		(12,500	)
Goldman Sachs Group, Inc. (The)	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/13/11-1/13/12		9.050		1/17/12		11,262
Goldman Sachs Group, Inc. (The)	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/21/11-1/19/12		7.450		1/23/12		(23,299	)
JPMorgan Chase Bank NA	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/19/11-1/19/12		7.700		1/23/12		(17,070	)
JPMorgan Chase Bank NA	8		GBP	The Historic Volatility of the mid GBP/CAD spot exchange rate during the period 12/15/11-1/17/12		8.800		1/19/12		1,642
Reference Entity Total										(24,968	)

50 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Volatility Swaps: Continued

	Notional
Reference Entity/	Amount	Paid by	Received by			Termination
Swap Counterparty	(000’s)	the Fund	the Fund			Date	Value
NZD/CAD Spot Exchange Rate
Goldman Sachs Group, Inc. (The)	17 NZD	The Historic Volatility of the mid NZD/CAD spot exchange rate during the period 12/12/11-1/13/12		9.500	%	1/17/12	$	(641	)
Total Volatility Swaps							$	262,501

Notional amount is reported in U.S. Dollars (USD), except for those denoted in the following currencies:

AUD	Australian Dollar
CAD	Canadian Dollar
EUR	Euro
GBP	British Pounds Sterling
JPY	Japanese Yen
NZD	New Zealand Dollar

Swap Summary as of December 30, 2011 is as follows:

The following table aggregates, as of period end, the amount receivable from/(payable to) each counterparty with whom the Fund has entered into a swap agreement. Swaps are individually disclosed in the preceding tables.

		Notional
	Swap Type from	Amount
Swap Counterparty	Fund Perspective	(000’s)			Value
Bank of America Merrill Lynch:
	Interest Rate	2,840		CAD	$	(1,818	)
	Interest Rate	500		EUR		20,922
						19,104
Bank of America NA:
	Credit Default Buy Protection		10,735			(927,549	)
	Interest Rate	1,910		EUR		23,071
	Interest Rate	198,600		MXN		(99,651	)
						(1,004,129	)
Barclays Bank plc:
	Credit Default Buy Protection		27,545			71,660
	Credit Default Sell Protection		3,800			(112,729	)
	Interest Rate	5,265		EUR		89,370
	Interest Rate	33,700		MXN		(14,241	)
	Interest Rate	13,915		NZD		549,297
	Interest Rate		11,300			385,933
	Interest Rate	139,200		ZAR		(11,092	)
						958,198
BNP Paribas	Total Return		5,650			(37,019	)
Citibank NA:
	Credit Default Buy Protection		10,000			171,709
	Credit Default Sell Protection		4,480			138,840
	Interest Rate	9,670		BRR		90,683
	Total Return	1,813		CHF		14,438
	Total Return	986		DKK		10,639
	Total Return	4,500		EUR		520
	Total Return	1,717		GBP		(65,033	)
	Total Return	525,530		JPY		(114,270	)
	Total Return	6,030		SEK		5,200
	Total Return		252			2,068
						254,794
Credit Suisse International:
	Credit Default Buy Protection		8,960			104,561
	Currency		1,100			(573	)
	Interest Rate	80,700		MXN		(123,564	)

51 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

Swap Summary: Continued

		Notional
	Swap Type from	Amount
Swap Counterparty	Fund Perspective	(000’s)			Value
Credit Suisse International: Continued
	Volatility	10		EUR	$	(12,256	)
	Volatility	8		GBP		14,997
						(16,835	)
Deutsche Bank AG:
	Credit Default Buy Protection		6,410			(137,544	)
	Credit Default Sell Protection		8,990			334,446
	Interest Rate	4,850		EUR		6,588
	Interest Rate	66,000		MXN		(31,636	)
	Volatility	8		GBP		(12,500	)
						159,354
Goldman Sachs Group, Inc. (The):
	Interest Rate	29,170		BRR		274,390
	Interest Rate	6,515		EUR		107,067
	Interest Rate	84,000		MXN		(123,281	)
	Interest Rate	72,770		SEK		(147,775	)
	Interest Rate	13,500		ZAR		(5,798	)
	Total Return	3,672		EUR		(75,372	)
	Total Return		37,960			954,313
	Volatility	25		AUD		(23,404	)
	Volatility	19		EUR		114,796
	Volatility	16		GBP		(12,037	)
	Volatility	17		NZD		(641	)
	Volatility		26			113,023
						1,175,281
Goldman Sachs International:
	Credit Default Buy Protection		4,480			187,598
	Credit Default Sell Protection		4,510			(189,589	)
						(1,991	)
HSBC Bank USA NA:
	Credit Default Sell Protection		2,960			(664,578	)
	Interest Rate	13,300		ZAR		(6,874	)
						(671,452	)
JPMorgan Chase Bank NA:
	Credit Default Sell Protection		1,420			(25,207	)
	Interest Rate	7,710		CAD		(44,942	)
	Interest Rate	1,915		EUR		16,243
	Interest Rate	21,960		PLZ		60,083
	Volatility	10		EUR		56,763
	Volatility	16		GBP		(15,428	)
	Volatility		13			39,188
						86,700
Merrill Lynch & Co., Inc.	Interest Rate	17,000		MXN		(119,215	)
Morgan Stanley:
	Total Return	4,326		GBP		(88,542	)
	Total Return		8,711			(249,682	)
						(338,224	)
Morgan Stanley Capital Services, Inc.	Credit Default Sell Protection		3,100			(134,878	)
UBS AG:
	Credit Default Sell Protection		4,480			(236,513	)
	Total Return		11,529			12,104
						(224,409	)
Westpac Banking Corp.	Interest Rate	10,670		AUD		(360,873	)
Total Swaps					$	(255,594	)

52 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Swap Summary: Continued

Notional amount is reported in U.S.Dollars (USD), except for those denoted in the following currencies:

AUD	Australian Dollar
BRR	Brazilian Real
CAD	Canadian Dollar
CHF	Swiss Franc
DKK	Danish Krone
EUR	Euro
GBP	British Pounds Sterling
JPY	Japanese Yen
MXN	Mexican Nuevo Peso
NZD	New Zealand Dollar
PLZ	Polish Zloty
SEK	Swedish Krona
ZAR	South African Rand

As of December 30, 2011, the Fund had entered into the following written swaption contracts:

	Underlying	Notional												Unrealized
	Swap Type from	Amount		Strike			Expiration		Premium					Appreciation
Reference Entity	Fund Perspective	(000’s)		Price/Rate			Date		Received		Value			(Depreciation)
Bank of America NA; Interest Rate Swaption (European); Swap Terms: Paid: 2.4375%; Received: Three-Month USD BBA LIBOR; Termination Date 5/24/24	Interest Rate Pay Fixed	$	60,800		2.4375	%		5/22/12	$	2,103,680	$	(2,125,358	)	$	(21,678	)
Bank of America NA; Interest Rate Swaption (European); Swap Terms; Paid: 2.315%; Received: Three-Month USD BBA LIBOR; Termination Date 5/31/22	Interest Rate Pay Fixed		42,600		2.3150			5/29/12		1,233,270		(1,386,632	)		(153,362	)
Goldman Sachs Group, Inc. (The), Interest Rate Swaption (European); Swap Terms; Paid: 2.465%; Received: Three-Month USD BBA LIBOR; Termination Date 5/24/24	Interest Rate Pay Fixed		60,800		2.4650			5/22/12		2,128,000		(2,258,481	)		(130,481	)
Goldman Sachs Group, Inc. (The); Interest Rate Swaption (European); Swap Terms; Paid: Three-Month USD BBA LIBOR; Received: 1.225%; Termination Date: 11/23/15	Interest Rate Receive Fixed		124,600		1.2250			11/21/12		1,044,486		(630,685	)		413,801
UBS AG; Interest Rate Swaption (European); Swap Terms; Paid: Three-Month USD BBA LIBOR Received: 3.215%; Termination Date 12/4/22	Interest Rate Receive Fixed		96,515		3.2150			11/30/12		1,679,361		(1,167,705	)		511,656
									$	8,188,797	$	(7,568,861	)	$	619,936

See accompanying Notes to Financial Statements.

53 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $2,013,069,955)	$	1,880,938,396
Affiliated companies (cost $453,272,500)		443,497,825
Wholly-owned subsidiary (cost $1,500,000)		1,482,519
		2,325,918,740
Cash		5,008,403
Cash—foreign currencies (cost $771,347)		731,412
Unrealized appreciation on foreign currency exchange contracts		6,674,020
Appreciated swaps, at value (upfront payments paid $560,888)		4,059,953
Depreciated swaps, at value (upfront payments paid $1,143,805)		1,058,863
Receivables and other assets:
Interest, dividends and principal paydowns		27,285,460
Investments sold (including $2,262,138 sold on a when-issued or delayed delivery basis)		4,750,784
Closed foreign currency contracts		2,419,546
Shares of beneficial interest sold		2,373,971
Futures margins		919,349
Other		65,762
Total assets		2,381,266,263
Liabilities
Appreciated options written, at value (premiums received $2,789,344)		1,427,148
Depreciated options written, at value (premiums received $683,109)		937,077
Appreciated swaptions written, at value (premiums received $2,723,847)		1,798,390
Depreciated swaptions written, at value (premiums received $5,464,950)		5,770,471
Unrealized depreciation on foreign currency exchange contracts		9,409,937
Appreciated swaps, at value (upfront payments received $2,261,813)		2,186,195
Depreciated swaps, at value (upfront payments received $912,614)		3,188,215
Payables and other liabilities:
Investments purchased (including $97,019,778 purchased on a when-issued or delayed delivery basis)		98,445,212
Closed foreign currency contracts		2,858,168
Shares of beneficial interest redeemed		945,482
Distribution and service plan fees		339,265
Futures margins		289,872
Shareholder communications		281,755
Transfer and shareholder servicing agent fees		191,305
Foreign capital gains tax		50,425
Trustees’ compensation		41,778
Other		115,470
Total liabilities		128,276,165
Net Assets	$	2,252,990,098

54 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Composition of Net Assets
Par value of shares of beneficial interest	$	412,905
Additional paid-in capital		2,229,752,031
Accumulated net investment income		151,980,652
Accumulated net realized gain on investments and foreign currency transactions		11,286,058
Net unrealized depreciation on investments and translation of assets and liabilities denominated in foreign currencies		(140,441,548	)
Net Assets	$	2,252,990,098
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $648,083,701 and 120,411,955 shares of beneficial interest outstanding)	$	5.38
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $1,604,906,397 and 292,492,931 shares of beneficial interest outstanding)	$	5.49

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

55 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011¹

Allocation of Income and Expenses from Master Funds2
Net investment income allocated from Oppenheimer Master Event-Linked Bond Fund, LLC:
Interest	$	4,069,460
Dividends		3,860
Expenses3		(219,345	)
Net investment income allocated from Oppenheimer Master Event-Linked Bond Fund, LLC		3,853,975
Net investment income allocated from Oppenheimer Master Loan Fund, LLC:
Interest (net of foreign withholding taxes of $381)		27,277,056
Dividends		159,063
Expenses4		(1,168,872	)
Net investment income allocated from Oppenheimer Master Loan Fund, LLC		26,267,247
Total allocation of net investment income from master funds		30,121,222
Investment Income
Interest (net of foreign withholding taxes of $85,329)		136,177,720
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $56,691)		797,281
Affiliated companies		108,474
Fee income on when-issued securities		2,197,637
Total investment income		139,281,112
Expenses
Management fees		13,684,521
Distribution and service plan fees—Service shares		4,184,730
Transfer and shareholder servicing agent fees:
Non-Service shares		694,965
Service shares		1,673,920
Shareholder communications:
Non-Service shares		76,649
Service shares		182,693
Custodian fees and expenses		246,234
Trustees’ compensation		56,379
Administration service fees		1,500
Other		193,848
Total expenses		20,995,439
Less waivers and reimbursements of expenses		(1,313,375	)
Net expenses		19,682,064
Net Investment Income		149,720,270

56 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments from unaffiliated companies (including premiums on options exercised)	$	41,024,794
Closing and expiration of option contracts written		6,144,856
Closing and expiration of futures contracts		9,478,578
Foreign currency transactions		(18,115,992	)
Swap contracts		1,922,300
Net realized gain (loss) allocated from:
Oppenheimer Master Event-Linked Bond Fund, LLC		(2,323,415	)
Oppenheimer Master Loan Fund, LLC		455,054
Net realized gain		38,586,175
Net change in unrealized appreciation/depreciation on:
Investments		(116,568,023	)
Translation of assets and liabilities denominated in foreign currencies		(47,584,909	)
Futures contracts		10,314,852
Option contracts written		1,108,228
Swaption contracts		619,936
Swap contracts		1,685,137
Net change in unrealized appreciation/deprecation allocated from:
Oppenheimer Master Event-Linked Bond Fund, LLC		(1,591,152	)
Oppenheimer Master Loan Fund, LLC		(16,653,717	)
Net change in unrealized appreciation/depreciation		(168,669,648	)
Net Increase in Net Assets Resulting from Operations	$	19,636,797

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	The Fund invests in certain affiliated Mutual Funds that expect to be treated as partnerships for tax purposes. See Note 1 of the accompanying Notes
3.	Net of expense waivers and/or reimbursement $2,322.
4.	Net of expense waivers and/or reimbursements $11,926.

See accompanying Notes to Financial Statements.

57 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

STATEMENT OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	149,720,270		$	200,479,913
Net realized gain		38,586,175			193,741,731
Net change in unrealized appreciation/depreciation		(168,669,648	)		11,389,337
Net increase in net assets resulting from operations		19,636,797			405,610,981
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(23,004,040	)		(66,430,241	)
Service shares		(46,831,691	)		(313,790,173	)
		(69,835,731	)		(380,220,414	)
Distributions from net realized gain:
Non-Service shares		(8,843,118	)		—
Service shares		(20,376,612	)		—
		(29,219,730	)		—
Beneficial Interest Transactions
Net decrease in net assets resulting from beneficial interest transactions:
Non-Service shares		(39,359,888	)		(81,259,481	)
Service shares		(10,325,962	)		(1,976,534,500	)
		(49,685,850	)		(2,057,793,981	)
Net Assets
Total decrease		(129,104,514	)		(2,032,403,414	)
Beginning of period		2,382,094,612			4,414,498,026
End of period (including accumulated net investment income of $151,980,652 and $5,967,605, respectively)	$	2,252,990,098		$	2,382,094,612

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

58 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,			Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	5.58		$	5.30		$	4.49		$	5.56		$	5.26
Income (loss) from investment operations:
Net investment income2		.36			.34			.30			.30			.28
Net realized and unrealized gain (loss)		(.31	)		.40			.53			(1.04	)		.21
Total from investment operations		.05			.74			.83			(.74	)		.49
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.18	)		(.46	)		(.02	)		(.27	)		(.19	)
Distributions from net realized gain		(.07	)		—			—3			(.06	)		—
Total dividends and distributions to shareholders		(.25	)		(.46	)		(.02	)		(.33	)		(.19	)
Net asset value, end of period	$	5.38		$	5.58		$	5.30		$	4.49		$	5.56
Total Return, at Net Asset Value4		0.85	%		14.97	%		18.83	%		(14.21	)%		9.69	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	648,084		$	711,755		$	757,772		$	648,570		$	734,611
Average net assets (in thousands)	$	694,868		$	737,071		$	681,926		$	753,062		$	664,668
Ratios to average net assets:5,6
Net investment income		6.50	%		6.47	%		6.20	%		5.78	%		5.34	%
Total expenses		0.77	%7		0.75	%8		0.67	% 8		0.59	%8		0.59	%8
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.71	%9		0.71	%		0.64	%		0.57	%		0.57	%
Portfolio turnover rate10		49	%		99	%		110	%		86	%		76	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Less than $0.005 per share.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.
6.	Includes the Fund’s share of the allocated expenses and/or net investment income from the master funds.
7.	Ratio including all expenses of the wholly-owned subsidiary and indirect expenses from affiliated funds were as follows:

Year Ended December 30, 2011 0.78 %

8. Total expenses including all affiliated fund expenses were as follows:

Year Ended December 31, 2010	0.75	%
Year Ended December 31, 2009	0.68	%
Year Ended December 31, 2008	0.60	%
Year Ended December 31, 2007	0.61	%

9. Ratio including expenses of the wholly-owned subsidiary and indirect expenses from affiliated funds were as follows:

Year Ended December 30, 2011 0.72 %

10. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	1,050,654,783	$	1,039,506,614
Year Ended December 31, 2010	$	1,034,550,699	$	1,085,289,655
Year Ended December 31, 2009	$	1,909,574,925	$	1,836,038,328
Year Ended December 31, 2008	$	634,319,548	$	594,845,589
Year Ended December 31, 2007	$	1,061,009,472	$	1,120,098,096

See accompanying Notes to Financial Statements.

59 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

FINANCIAL HIGHLIGHTS Continued

	Year Ended
	December 30,			Year Ended December 31,
Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	5.68		$	5.38		$	4.56		$	5.65		$	5.34
Income (loss) from investment operations:
Net investment income2		.35			.33			.29			.29			.28
Net realized and unrealized gain (loss)		(.31	)		.42			.54			(1.06	)		.22
Total from investment operations		.04			.75			.83			(.77	)		.50
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.16	)		(.45	)		(.01	)		(.26	)		(.19	)
Distributions from net realized gain		(.07	)		—			—3			(.06	)		—
Total dividends and distributions to shareholders		(.23	)		(.45	)		(.01	)		(.32	)		(.19	)
Net asset value, end of period	$	5.49		$	5.68		$	5.38		$	4.56		$	5.65
Total Return, at Net Asset Value4		0.65	%		14.77	%		18.41	%		(14.49	)%		9.55	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	1,604,906		$	1,670,340		$	3,656,726		$	2,810,315		$	2,876,016
Average net assets (in thousands)	$	1,673,715		$	2,485,427		$	3,143,836		$	3,152,967		$	2,075,028
Ratios to average net assets:5,6
Net investment income		6.25	%		6.15	%		5.95	%		5.54	%		5.08	%
Total expenses		1.02	%7		0.99	%8		0.92	%8		0.84	%8		0.84	%8
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.96	%9		0.95	%		0.89	%		0.82	%		0.82	%
Portfolio turnover rate10		49	%		99	%		110	%		86	%		76	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Less than $0.005 per share.
4.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
5.	Annualized for periods less than one full year.
6.	Includes the Fund’s share of the allocated expenses and/or net investment income from the master funds.
7.	Ratio including all expenses of the wholly-owned subsidiary and indirect expenses from affiliated funds were as follows:

Year Ended December 30, 2011 1.03 %

8. Total expenses including all affiliated fund expenses were as follows:

Year Ended December 31, 2010	0.99	%
Year Ended December 31, 2009	0.93	%
Year Ended December 31, 2008	0.85	%
Year Ended December 31, 2007	0.86	%

9. Ratio including expenses of the wholly-owned subsidiary and indirect expenses from affiliated funds were as follows:

Year Ended December 30, 2011 0.97 %

10. The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

	Purchase Transactions		Sale Transactions
Year Ended December 30, 2011	$	1,050,654,783	$	1,039,506,614
Year Ended December 31, 2010	$	1,034,550,699	$	1,085,289,655
Year Ended December 31, 2009	$	1,909,574,925	$	1,836,038,328
Year Ended December 31, 2008	$	634,319,548	$	594,845,589
Year Ended December 31, 2007	$	1,061,009,472	$	1,120,098,096

See accompanying Notes to Financial Statements.

60 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Global Strategic Income Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek a high level of current income principally derived from interest on debt securities. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

61 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Structured securities are valued utilizing price quotations obtained from broker-dealers or independent pricing services. Values are determined based upon market inputs which typically include the price of underlying financial instruments, stock market indices, foreign currencies, interest rate spreads, commodities, or the occurrence of other specific events.

     Swap contracts are valued utilizing price quotations obtained from broker-dealer counterparties or independent pricing services. Values are determined based on relevant market information on the underlying reference assets which may include credit spreads, credit event probabilities, index values, individual security values, forward interest rates, variable interest rates, volatility measures and forward currency rates.

     Forward foreign currency exchange contracts are valued utilizing current and forward currency rates obtained from independent pricing services.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. As of December 30, 2011, the Manager determined the fair value of certain notes using internal models based on anticipated cash flows. The Manager determined the fair value of certain distressed notes at a discounted residual value or at a discount to the value of the collateral held in regards to the particular note. The Manager fair valued certain thinly traded collateralized debt obligations using monthly broker-dealer price quotations. The Manager fair valued certain thinly traded collateralized mortgage obligations using modeled price quotations provided by an external pricing vendor. The Manager determined the fair value of certain common stock at the last traded price. For certain common and preferred stock that do not trade, the Manager has determined the fair value of these securities using internal models utilizing Manager assumptions, comparable security inputs and the company’s quarterly financial statements. For certain warrants received in a bankruptcy reorganization that do not trade, the Manager has determined the fair value of these securities based on the residual value of the original bonds. Such investments have been classified as Level 3 instruments.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

     The net asset value per share of the Subsidiary is determined as of the close of the Exchange, on each day the Exchange is open for trading. The net asset value per share is determined by dividing the value of the Subsidiary’s net assets by the number of shares that are outstanding. The Subsidiary values its investments in the same manner as the Fund as described above.

Structured Securities. The Fund invests in structured securities whose market values, interest rates and/or redemption prices are linked to the performance of underlying foreign currencies, interest rate spreads, stock market indices, prices of individual securities, commodities or other financial instruments or the occurrence of other specific events. The structured securities are often leveraged, increasing the volatility of each note’s market value relative to the change in the underlying linked financial element or event. Fluctuations in value of these securities are recorded as unrealized gains and losses in the accompanying Statement of Operations. The Fund records a realized gain or loss when a structured security is sold or matures.

62 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Securities on a When-Issued or Delayed Delivery Basis. The Fund may purchase securities on a “when-issued” basis, and may purchase or sell securities on a “delayed delivery” basis. “When-issued” or “delayed delivery” refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis normally takes place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of the Fund’s net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. When the Fund engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain or dispose of the security at a price and yield it considers advantageous. The Fund may also sell securities that it purchased on a when-issued basis or forward commitment prior to settlement of the original purchase.

As of December 30, 2011, the Fund had purchased securities issued on a when-issued or delayed delivery basis and sold securities issued on a delayed delivery basis as follows:

	When-Issued or Delayed
	Delivery Basis Transactions
Purchased securities	$	97,019,778
Sold securities		2,262,138

The Fund may enter into “forward roll” transactions with respect to mortgage-related securities. In this type of transaction, the Fund sells a mortgage-related security to a buyer and simultaneously agrees to repurchase a similar security (same type, coupon and maturity) at a later date at a set price. During the period between the sale and the repurchase, the Fund will not be entitled to receive interest and principal payments on the securities that have been sold. The Fund records the incremental difference between the forward purchase and sale of each forward roll as realized gain (loss) on investments or as fee income in the case of such transactions that have an associated fee in lieu of a difference in the forward purchase and sale price.

     Forward roll transactions may be deemed to entail embedded leverage since the Fund purchases mortgage-related securities with extended settlement dates rather than paying for the securities under a normal settlement cycle. This embedded leverage increases the Fund’s market value of investments relative to its net assets which can incrementally increase the volatility of the Fund’s performance. Forward roll transactions can be replicated over multiple settlement periods.

     Risks of entering into forward roll transactions include the potential inability of the counterparty to meet the terms of the agreement; the potential of the Fund to receive inferior securities at redelivery as compared to the securities sold to the counterparty; and counterparty credit risk.

Credit Risk. The Fund invests in high-yield, non-investment-grade bonds, which may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Fund may acquire securities that have missed an interest payment, and is not obligated to dispose of securities whose issuers or underlying obligors subsequently miss an interest payment. Information concerning securities not accruing interest as of December 30, 2011 is as follows:

Cost	$	27,027,445
Market Value	$	5,465,212
Market Value as a % of Net Assets		0.24	%

Investment in Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd. The Fund has established a Cayman Islands company that is wholly-owned and controlled by the Fund (the “Subsidiary”). The Fund may invest up to 25% of its total assets in the Subsidiary. The Subsidiary invests primarily in commodity-linked derivatives (including commodity related futures, options and swap contracts), and exchange traded funds and certain fixed-income securities and other

63 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

investments that may serve as margin or collateral for its derivatives positions. Investments in the Subsidiary are expected to provide the Fund with exposure to commodities markets within the limitations of the federal tax requirements that apply to the Fund. The Subsidiary is subject to the same investment restrictions and guidelines, and follows the same compliance policies and procedures, as the Fund. The Fund wholly owns and controls the Subsidiary, and the Fund and Subsidiary are both managed by the Manager.

     The Fund does not consolidate the assets, liabilities, capital or operations of the Subsidiary into its financial statements. Rather, the Subsidiary is separately presented as an investment in the Fund’s Statement of Investments. Shares of the Subsidiary are valued at their net asset value per share. Gains or losses on withdrawals of capital from the Subsidiary by the Fund are recognized on an average cost basis. Unrealized appreciation or depreciation on the Fund’s investment in the Subsidiary is recorded in the Fund’s Statement of Assets and Liabilities and the Fund’s Statement of Operations. Distributions received from the Subsidiary are recorded as income on the ex-dividend date.

     For tax purposes, the Subsidiary is an exempted Cayman investment company. The Subsidiary has received an undertaking from the Government of the Cayman Islands exempting it from all local income, profits and capital gains taxes through September of 2030. No such taxes are levied in the Cayman Islands at the present time. For U.S. income tax purposes, the Subsidiary is a Controlled Foreign Corporation and as such is not subject to U.S. income tax. However, as a wholly-owned Controlled Foreign Corporation, the Subsidiary’s net income and capital gain, to the extent of its earnings and profits, will be included each year in the Fund’s investment company taxable income. For the year ended December 30, 2011, the Subsidiary has a deficit of $17,481 in its taxable earnings and profits. In addition, any in-kind capital contributions made by the Fund to the Subsidiary will result in the Fund recognizing taxable gain to the extent of unrealized gain, if any, on securities transferred to the Subsidiary while any unrealized losses on securities so transferred will not be recognized at the time of transfer.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Investment in Oppenheimer Master Funds. The Fund is permitted to invest in entities sponsored and/or advised by the Manager or an affiliate. Certain of these entities in which the Fund invests are mutual funds registered under the Investment Company Act of 1940 that expect to be treated as partnerships for tax purposes, specifically Oppenheimer Master Loan Fund, LLC and Oppenheimer Master Event-Linked Bond Fund, LLC (the “Master Funds”). Each Master Fund has its own investment risks, and those risks can affect the value of the Fund’s investments and therefore the value of the Fund’s shares. To the extent that the Fund invests more of its assets in one Master Fund than in another, the Fund will have greater exposure to the risks of that Master Fund.

     The investment objective of Oppenheimer Master Loan Fund, LLC is to seek as high a level of current income and preservation of capital as is consistent with investing primarily in loans and other debt securities. The investment objective of Oppenheimer Master Event-Linked Bond Fund, LLC is to seek a high level of current income principally derived from interest on debt securities. The Fund’s investments in the Master Funds are included in the Statement of Investments. The Fund recognizes income and gain/(loss) on its investments in each Master Fund according to its allocated pro-rata share, based on its relative proportion of total outstanding Master Fund shares held, of the total net income earned and the net gain/(loss) realized on investments sold by the Master Funds. As a shareholder, the Fund

64 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

is subject to its proportional share of the Master Funds’ expenses, including their management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in the Master Funds.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

					Net Unrealized
					Depreciation
					Based on Cost of
					Securities and
Undistributed	Undistributed		Accumulated		Other Investments
Net Investment	Long-Term		Loss		for Federal Income
Income	Gain		Carryforward1		Tax Purposes
$147,943,807	$	16,250,407	$	792,837	$	138,562,774

1. The Fund had $792,837 of straddle losses which were deferred.

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

65 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Increase to		Reduction to
	Accumulated		Accumulated
Increase to	Net Investment		Net Realized Gain
Paid-in Capital	Income		on Investments4
$2,370,070	$	66,128,508	$	68,498,578

4. $2,370,070, including $1,364,369 of long-term capital gain, was distributed in connection with Fund share redemptions.

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended		Year Ended
	December 30, 2011		December 31, 2010
Distributions paid from:
Ordinary income	$	69,835,731	$	380,220,414
Long-term capital gain		29,219,730		—
Total	$	99,055,461	$	380,220,414

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	2,465,151,650
Federal tax cost of other investments		205,375,217
Total federal tax cost	$	2,670,526,867
Gross unrealized appreciation	$	112,337,035
Gross unrealized depreciation		(250,899,809	)
Net unrealized depreciation	$	(138,562,774	)

Certain foreign countries impose a tax on capital gains which is accrued by the Fund based on unrealized appreciation, if any, on affected securities. The tax is paid when the gain is realized.

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

66 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		11,331,249		$	62,405,055			13,659,013		$	73,616,257
Dividends and/or distributions reinvested		5,843,515			31,847,158			13,002,895			66,430,241
Redeemed		(24,340,756	)		(133,612,101	)		(42,045,616	)		(221,305,979	)
Net decrease		(7,165,992	)	$	(39,359,888	)		(15,383,708	)	$	(81,259,481	)
Service Shares
Sold		30,704,662		$	172,623,711			39,118,559		$	211,931,885
Dividends and/or distributions reinvested		12,087,824			67,208,303			60,274,068			313,790,173
Redeemed		(44,589,582	)		(250,157,976	)		(484,576,971	)		(2,502,256,558	)
Net decrease		(1,797,096	)	$	(10,325,962	)		(385,184,344	)	$	(1,976,534,500	)

67 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in the Subsidiary and IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	885,448,910	$	981,223,989
U.S. government and government agency obligations		39,608,149		1,502,573
To Be Announced (TBA) mortgage-related securities		1,050,654,783		1,039,506,614

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Next $200 million	0.60
Over $1 billion	0.50

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $2,376,241 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.75% for Non-Service shares and 1.00% for Service shares.

     The Manager has contractually agreed to waive the management fee it receives from the Fund in an amount equal to the management fee it receives from the Subsidiary. This undertaking will continue in effect for so long as the Fund invests in the Subsidiary and may not be terminated unless approved by the Fund’s Board of Trustees. During the year ended December 30, 2011, the Manager waived $1,195.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investments in IMMF, Oppenheimer Short Duration Fund and the Master Funds. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $1,312,180 for management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

68 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to

69 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction. As of December 30, 2011, the maximum amount of loss that the Fund would incur if the counterparties to its derivative transactions failed to perform would be $23,298,100, which represents gross payments to be received by the Fund on these derivative contracts were they to be unwound as of period end. To reduce this risk the Fund has entered into master netting arrangements, established within the Fund’s International Swap and Derivatives Association, Inc. master agreements, which allow the Fund to net unrealized appreciation and depreciation for certain positions in swaps, over-the-counter options, swaptions, and forward currency exchange contracts for each individual counterparty. The amount of loss that the Fund would incur taking into account these master netting arrangements would be $6,185,349 as of December 30, 2011. In addition, the Fund may require that certain counterparties post cash and/or securities in collateral accounts to cover their net payment obligations for those derivative contracts subject to International Swap and Derivatives Association, Inc. master agreements. If the counterparty fails to perform under these contracts and agreements, the cash and/or securities will be made available to the Fund.

     As of December 30, 2011 the Fund has required certain counterparties to post collateral of $6,108,673.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

     As of December 30, 2011, the aggregate fair value of derivative instruments with credit related contingent features in a net liability position was $8,019,755 for which the Fund has posted collateral of $5,763,355. If a contingent feature would have been triggered as of December 30, 2011, the Fund could have been required to pay this amount in cash to its counterparties. If the Fund fails to perform under these contracts and agreements, the cash and/or securities posted as collateral will be made available to the counterparty. Cash posted as collateral for these contracts, if any, is reported on the Statement of Assets and Liabilities; securities posted as collateral, if any, are reported on the Statement of Investments.

Valuations of derivative instruments as of December 30, 2011 are as follows:

	Asset Derivatives			Liability Derivatives
	Statement			Statement
Derivatives Not	of Assets			of Assets
Accounted for as	and Liabilities			and Liabilities
Hedging Instruments	Location	Value		Location	Value
Credit contracts	Appreciated swaps, at value	$	859,355	Appreciated swaps, at value	$	2,186,195
Credit contracts	Depreciated swaps, at value		1,058,863	Depreciated swaps, at value		1,151,796
Equity contracts	Appreciated swaps, at value		1,215,189	Depreciated swaps, at value		845,825

70 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

	Asset Derivatives				Liability Derivatives
	Statement				Statement
Derivatives Not	of Assets				of Assets
Accounted for as	and Liabilities				and Liabilities
Hedging Instruments	Location	Value			Location	Value
Foreign exchange contracts					Depreciated swaps, at value	$	573
Interest rate contracts	Appreciated swaps, at value	$	1,633,738		Depreciated swaps, at value		1,100,851
Volatility contracts	Appreciated swaps, at value		351,671		Depreciated swaps, at value		89,170
Equity contracts	Futures margins		94,356	*	Futures margins		131,001
Interest rate contracts	Futures margins		824,993	*	Futures margins		158,871
Foreign exchange contracts	Unrealized appreciation on foreign currency exchange contracts		6,674,020		Unrealized depreciation on foreign currency exchange contracts		9,409,937
Foreign exchange contracts					Appreciated options written, at value		263,046
Foreign exchange contracts					Depreciated options written, at value		16,868
Interest rate contracts					Appreciated options written, at value		1,164,102
Interest rate contracts					Depreciated options written, at value		920,209
Interest rate contracts					Appreciated swaptions written, at value		1,798,390
Interest rate contracts					Depreciated swaptions written, at value		5,770,471
Foreign exchange contracts	Investments, at value		487,099	**
Interest rate contracts	Investments, at value		9,637,599	**
Total		$	22,836,883			$	25,007,305

*	Includes only the current day’s variation margin. Prior variation margin movements have been reflected in cash on the Statement of Assets and Liabilities upon receipt or payment.
**	Amounts relate to purchased options and swaptions

     The effect of derivative instruments on the Statement of Operations is as follows:

	Amount of Realized Gain or (Loss) Recognized on Derivatives
	Investments from
	unaffiliated			Closing and
	companies			expiration		Closing and
Derivatives Not	(including			of option		expiration of			Foreign
Accounted for as	premiums on			contracts		futures			currency
Hedging Instruments	options exercised)*			written		contracts			transactions			Swap contracts			Total
Credit contracts	$	—		$	—	$	—		$	—		$	(453,430	)	$	(453,430	)
Equity contracts		—			—		(719,017	)		—			(3,194,024	)		(3,913,041	)
Foreign exchange contracts		(1,094,302	)		3,524,494		681,420			(33,825,963	)		(240,915	)		(30,955,266	)
Interest rate contracts		6,132,218			2,620,362		9,516,175			—			2,917,344			21,186,099
Volatility contracts		—			—		—			—			2,893,325			2,893,325
Total	$	5,037,916		$	6,144,856	$	9,478,578		$	(33,825,963	)	$	1,922,300		$	(11,242,313	)

* Includes purchased option contracts, purchased swaption contracts and written option contracts exercised, if any.

71 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

	Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
										Translation of
										assets and
										liabilities
Derivatives Not				Option		Swaption				denominated
Accounted for as				contracts		contracts		Futures		in foreign
Hedging Instruments	Investments*			written		written		contracts		currencies		Swap contracts			Total
Credit contracts	$	—		$	—	$	—	$	—	$	—	$	210,402		$	210,402
Equity contracts		—			—		—		201,501		—		(532,569	)		(331,068	)
Foreign exchange contracts		(205,745	)		810,970		—		—		5,737,529		1,563,616			7,906,370
Interest rate contracts		(3,840,417	)		297,258		619,936		10,113,351		—		182,900			7,373,028
Volatility contracts		—			—		—		—		—		260,788			260,788
Total	$	(4,046,162	)	$	1,108,228	$	619,936	$	10,314,852	$	5,737,529	$	1,685,137		$	15,419,520

* Includes purchased option contracts and purchased swaption contracts, if any.

Foreign Currency Exchange Contracts

The Fund may enter into foreign currency exchange contracts (“forward contracts”) for the purchase or sale of a foreign currency at a negotiated rate at a future date.

     Forward contracts are reported on a schedule following the Statement of Investments. Forward contracts will be valued daily based upon the closing prices of the forward currency rates determined at the close of the Exchange as provided by a bank, dealer or pricing service. The resulting unrealized appreciation (depreciation) is reported in the Statement of Assets and Liabilities as a receivable or payable and in the Statement of Operations within the change in unrealized appreciation (depreciation). At contract close, the difference between the original cost of the contract and the value at the close date is recorded as a realized gain (loss) in the Statement of Operations.

     The Fund has purchased and sold certain forward foreign currency exchange contracts of different currencies in order to acquire currencies to pay for or sell currencies to acquire related foreign securities purchase and sale transactions, respectively, or to convert foreign currencies to U.S. dollars from related foreign securities transactions. These foreign currency exchange contracts are negotiated at the current spot exchange rate with settlement typically within two business days thereafter.

     The Fund has entered into forward foreign currency exchange contracts with the obligation to purchase specified foreign currencies in the future at a currently negotiated forward rate in order to take a positive investment perspective on the related currency. These forward foreign currency exchange contracts seek to increase exposure to foreign exchange rate risk.

     The Fund has entered into forward foreign currency exchange contracts with the obligation to purchase specified foreign currencies in the future at a currently negotiated forward rate in order to decrease exposure to foreign exchange rate risk associated with foreign currency denominated securities held by the Fund.

     The Fund has entered into forward foreign currency exchange contracts with the obligation to sell specified foreign currencies in the future at a currently negotiated forward rate in order to take a negative investment perspective on the related currency. These forward foreign currency exchange contracts seek to increase exposure to foreign exchange rate risk.

     The Fund has entered into forward foreign currency exchange contracts with the obligation to sell specified foreign currencies in the future at a currently negotiated forward rate in order to decrease exposure to foreign exchange rate risk associated with foreign currency denominated securities held by the Fund.

     During the year ended December 30, 2011, the Fund had daily average contract amounts on forward foreign currency contracts to buy and sell of $507,810,597 and $295,644,686, respectively.

     Additional associated risk to the Fund includes counterparty credit risk. Counterparty credit risk arises from the possibility that the counterparty will default.

72 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

Futures Contracts

A futures contract is a commitment to buy or sell a specific amount of a financial instrument, or currency, at a negotiated price on a stipulated future date. The Fund may buy and sell futures contracts and may also buy or write put or call options on these futures contracts.

     Futures contracts traded on a commodities or futures exchange will be valued at the final settlement price or official closing price on the principal exchange as reported by such principal exchange at its trading session ending at, or most recently prior to, the time when the Fund’s assets are valued.

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

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

The Fund has purchased futures contracts on various bonds and notes to increase exposure to interest rate risk.

The Fund has sold futures contracts on various bonds and notes to decrease exposure to interest rate risk.

The Fund has purchased futures contracts on various equity indexes to increase exposure to equity risk.

The Fund has sold futures contracts on various equity indexes to decrease exposure to equity risk.

The Fund has purchased futures contracts on various currencies to increase exposure to foreign exchange rate risk.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $393,293,709 and $304,497,391 on futures contracts purchased and sold, respectively.

     Additional associated risks of entering into futures contracts (and related options) include the possibility that there may be an illiquid market where the Fund is unable to liquidate the contract or enter into an offsetting position and, if used for hedging purposes, the risk that the price of the contract will correlate imperfectly with the prices of the Fund’s securities.

Option Activity

The Fund may buy and sell put and call options, or write put and call options. When an option is written, the Fund receives a premium and becomes obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option.

     Options are valued daily based upon the last sale price on the principal exchange on which the option is traded. The difference between the premium received or paid, and market value of the option, is recorded as unrealized appreciation or depreciation. The net change in unrealized appreciation or depreciation is reported in the Statement of Operations. When an option is exercised, the cost of the security purchased or the proceeds of the security sale are adjusted by the amount of premium received or paid. Upon the expiration or closing of the option transaction, a gain or loss is reported in the Statement of Operations.

     The Fund has purchased call options on currencies to increase exposure to foreign exchange rate risk. A purchased call option becomes more valuable as the price of the underlying financial instrument appreciates relative to the strike price.

     The Fund has purchased put options on currencies to decrease exposure to foreign exchange rate risk. A purchased put option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     The Fund has purchased call options on treasury and/or euro futures to increase exposure to interest rate risk. A purchased call option becomes more valuable as the price of the underlying financial instrument appreciates relative to the strike price.

73 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

     The Fund has purchased put options on treasury and/or euro futures to decrease exposure to interest rate risk. A purchased put option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $2,943,183 and $534,702 on purchased call options and purchased put options, respectively.

     Options written, if any, are reported in a schedule following the Statement of Investments and as a liability in the Statement of Assets and Liabilities. Securities held in collateralized accounts to cover potential obligations with respect to outstanding written options are noted in the Statement of Investments.

     The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk that there may be an illiquid market where the Fund is unable to close the contract.

     The Fund has written put options on currencies to increase exposure to foreign exchange rate risk. A written put option becomes more valuable as the price of the underlying financial instrument appreciates relative to the strike price.

     The Fund has written call options on currencies to decrease exposure to foreign exchange rate risk. A written call option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     The Fund has written call options on treasury and/or euro futures to decrease exposure to interest rate risk. A written call option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     The Fund has written put options on treasury and/or euro futures to increase exposure to interest rate risk. A written put option becomes more valuable as the price of the underlying financial instrument appreciates relative to the strike price.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $325,841 and $371,464 on written call options and written put options, respectively.

     Additional associated risks to the Fund include counterparty credit risk for over-the-counter options and liquidity risk.

Written option activity for the year ended December 30, 2011 was as follows:

	Call Options						Put Options
	Number of			Amount of			Number of			Amount of
	Contracts			Premiums			Contracts			Premiums
Options outstanding as of December 31, 2010		—		$	—			—		$	—
Options written		120,340,252,175			6,884,670			139,478,984,387			7,041,489
Options closed or expired		(2,809,615,444	)		(3,761,874	)		(1,748,384,721	)		(4,417,546	)
Options exercised		(1,659,245,049	)		(1,115,033	)		(3,488,195,000	)		(1,159,253	)
Options outstanding as of December 30, 2011		115,871,391,682		$	2,007,763			134,242,404,666		$	1,464,690

Swap Contracts

The Fund may enter into swap contract agreements with a counterparty to exchange a series of cash flows based on either specified reference rates, or the occurrence of a credit event, over a specified period. Such contracts may include interest rate, equity, debt, index, total return, credit and currency swaps.

     Swaps are marked to market daily using primarily quotations from pricing services, counterparties and brokers. Swap contracts are reported on a schedule following the Statement of Investments. The values of swap contracts are aggregated by positive and negative values and disclosed separately on the Statement of Assets and Liabilities by contracts in unrealized appreciation and depreciation positions. Upfront payments paid or received, if any, affect the value of the respective swap. Therefore, to determine the unrealized appreciation (depreciation) on swaps, upfront payments paid should be subtracted from, while upfront payments received should be added to, the value of contracts reported as an asset on the Statement of Assets and Liabilities. Conversely, upfront payments paid should be added to, while upfront payments received should be subtracted from the value of contracts reported as a liability. The unrealized appreciation

74 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

(depreciation) related to the change in the valuation of the notional amount of the swap is combined with the accrued interest due to (owed by) the Fund at termination or settlement. The net change in this amount during the period is included on the Statement of Operations. The Fund also records any periodic payments received from (paid to) the counterparty, including at termination, under such contracts as realized gain (loss) on the Statement of Operations.

     Swap contract agreements are exposed to the market risk factor of the specific underlying reference asset. Swap contracts are typically more attractively priced compared to similar investments in related cash securities because they isolate the risk to one market risk factor and eliminate the other market risk factors. Investments in cash securities (for instance bonds) have exposure to multiple risk factors (credit and interest rate risk). Because swaps require little or no initial cash investment, they can expose the Fund to substantial risk in the isolated market risk factor.

Credit Default Swap Contracts. A credit default swap is a bilateral contract that enables an investor to buy or sell protection on a debt security against a defined-issuer credit event, such as the issuer’s failure to make timely payments of interest or principal on the debt security, bankruptcy or restructuring. The Fund may enter into credit default swaps either by buying or selling protection on a single security, sovereign debt, or a basket of securities (the “reference asset”).

     The buyer of protection pays a periodic fee to the seller of protection based on the notional amount of debt securities underlying the swap contract. The seller of protection agrees to compensate the buyer of protection for future potential losses as a result of a credit event on the reference asset. The contract effectively transfers the credit event risk of the reference asset from the buyer of protection to the seller of protection.

     The ongoing value of the contract will fluctuate throughout the term of the contract based primarily on the credit risk of the reference asset. If the credit quality of the reference asset improves relative to the credit quality at contract initiation, the buyer of protection may have an unrealized loss greater than the anticipated periodic fee owed. This unrealized loss would be the result of current credit protection being cheaper than the cost of credit protection at contract initiation. If the buyer elects to terminate the contract prior to its maturity, and there has been no credit event, this unrealized loss will become realized. If the contract is held to maturity, and there has been no credit event, the realized loss will be equal to the periodic fee paid over the life of the contract.

     If there is a credit event, the buyer of protection can exercise its rights under the contract and receive a payment from the seller of protection equal to the notional amount of the reference asset less the market value of the reference asset. Upon exercise of the contract the difference between the value of the underlying reference asset and the notional amount is recorded as realized gain (loss) and is included on the Statement of Operations.

     The Fund has sold credit protection through credit default swaps to increase exposure to the credit risk of individual securities and/or, indexes that are either unavailable or considered to be less attractive in the bond market.

     The Fund has purchased credit protection through credit default swaps to decrease exposure to the credit risk of individual securities and/or, indexes.

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $74,950,385 and $46,280,769 on credit default swaps to buy protection and credit default swaps to sell protection, respectively.

     Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

Interest Rate Swap Contracts. An interest rate swap is an agreement between counterparties to exchange periodic payments based on interest rates. One cash flow stream will typically be a floating rate payment based upon a specified interest rate while the other is typically a fixed interest rate.

     The Fund has entered into interest rate swaps in which it pays a floating interest rate and receives a fixed interest rate in order to increase exposure to interest rate risk. Typically, if relative interest rates rise, payments made by the Fund under a swap agreement will be greater than the payments received by the Fund.

     The Fund has entered into interest rate swaps in which it pays a fixed interest rate and receives a floating interest rate in order to decrease exposure to interest rate risk. Typically, if relative interest rates rise, payments received by the Fund under the swap agreement will be greater than the payments made by the Fund.

75 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $57,933,599 and $189,819,585 on interest rate swaps which pay a fixed rate and interest rate swaps which receive a fixed rate, respectively.

     Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

Total Return Swap Contracts. A total return swap is an agreement between counterparties to exchange periodic payments based on asset or non-asset references. One cash flow is typically based on a non-asset reference (such as an interest rate or index) and the other on the total return of a reference asset (such as a security or a basket of securities). The total return of the reference asset typically includes appreciation or depreciation on the reference asset, plus any interest or dividend payments.

     Total return swap contracts are exposed to the market risk factor of the specific underlying financial instrument or index. Total return swaps are less standard in structure than other types of swaps and can isolate and/or, include multiple types of market risk factors including equity risk, credit risk, and interest rate risk.

     The Fund has entered into total return swaps on various equity securities or indexes to increase exposure to equity risk. These equity risk related total return swaps require the Fund to pay a floating reference interest rate, or an amount equal to the negative price movement of securities or an index multiplied by the notional amount of the contract. The Fund will receive payments equal to the positive price movement of the same securities or index multiplied by the notional amount of the contract.

     The Fund has entered into total return swaps on various equity securities or indexes to decrease exposure to equity risk. These equity risk related total return swaps require the Fund to pay an amount equal to the positive price movement of securities or an index multiplied by the notional amount of the contract. The Fund will receive payments of a floating reference interest rate or an amount equal to the negative price movement of the same securities or index multiplied by the notional amount of the contract.

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $71,294,843 and $27,935,187 on total return swaps which are long the reference asset and total return swaps which are short the reference asset, respectively.

     Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

Currency Swaps. A currency swap is an agreement between counterparties to exchange different currencies equivalent to the notional value at contract inception and reverse the exchange of the same notional values of those currencies at contract termination. The contract may also include periodic exchanges of cash flows based on a specified index or interest rate.

     The Fund has entered into currency swap contracts with the obligation to pay an interest rate on the dollar notional amount and receive an interest rate on various foreign currency notional amounts in order to take a positive investment perspective on the related currencies for which the Fund receives a payment. These currency swap contracts seek to increase exposure to foreign exchange rate risk.

     The Fund has entered into currency swap contracts with the obligation to pay an interest rate on various foreign currency notional amounts and receive an interest rate on the dollar notional amount in order to take a negative investment perspective on the related currencies for which the Fund receives a payment. These currency swap contracts seek to decrease exposure to foreign exchange rate risk.

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $4,434,734 on currency swaps.

     Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

Volatility Swap Contracts. A volatility swap is an agreement between counterparties to exchange periodic payments based on the measured volatility of a reference security, index, currency or other reference investment over a specified time frame. One cash flow is typically based on the volatility of the reference investment as measured by changes in its price or level while the other cash flow is based on an interest rate or the measured volatility of a different reference investment. The appreciation or depreciation on a volatility swap will typically

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depend on the magnitude of the reference investment’s volatility, or size of the movement, rather than general directional increases or decreases in its price.

     Volatility swaps are less standard in structure than other types of swaps and provide pure, or isolated, exposure to volatility risk of the specific underlying reference investment. Volatility swaps are typically used to speculate on future volatility levels, to trade the spread between realized and expected volatility, or to decrease the volatility exposure of investments held by the Fund.

     The Fund has entered into volatility swaps to increase exposure to the volatility risk of various reference investments. These types of volatility swaps require the fund to pay the measured volatility and receive a fixed interest payment over the period of the contract. If the measured volatility of the related reference investment increases over the period, the swaps will depreciate in value. Conversely, if the measured volatility of the related reference investment decreases over the period, the swaps will appreciate in value.

     The Fund has entered into volatility swaps to decrease exposure to the volatility risk of various reference investments. These types of volatility swaps require the fund to pay a fixed interest payment and receive the measured volatility over the period of the contract. If the measured volatility of the related reference investment increases over the period, the swaps will appreciate in value. Conversely, if the measured volatility of the related reference investment decreases over the period, the swaps will depreciate in value.

     For the year ended December 30, 2011, the Fund had ending monthly average notional amounts of $72,000 and $172,963 on volatility swaps which pay volatility and volatility swaps which receive volatility, respectively.

     Additional associated risks to the Fund include counterparty credit risk and liquidity risk.

Swaption Transactions

The Fund may enter into a swaption contract which grants the purchaser the right, but not the obligation, to enter into a swap transaction at preset terms detailed in the underlying agreement within a specified period of time. The purchaser pays a premium to the swaption writer who bears the risk of unfavorable changes in the preset terms on the underlying swap.

     Swaptions are marked to market daily using primarily portfolio pricing services or quotations from counterparties and brokers. Purchased swaptions are reported as a component of investments in the Statement of Investments, the Statement of Assets and Liabilities and the Statement of Operations. Written swaptions are reported on a schedule following the Statement of Investments and their value is reported as a separate asset or liability line item in the Statement of Assets and Liabilities. The net change in unrealized appreciation or depreciation on written swaptions is separately reported in the Statement of Operations. When a swaption is exercised, the cost of the swap is adjusted by the amount of premium paid or received. Upon the expiration or closing of an unexercised swaption contract, a gain or loss is reported in the Statement of Operations for the amount of the premium paid or received.

     The Fund generally will incur a greater risk when it writes a swaption than when it purchases a swaption. When the Fund writes a swaption it will become obligated, upon exercise of the swaption, according to the terms of the underlying agreement. Swaption contracts written by the Fund do not give rise to counterparty credit risk as they obligate the Fund, not its counterparty, to perform. When the Fund purchases a swaption it only risks losing the amount of the premium it paid if the swaption expires unexercised. However, when the Fund exercises a purchased swaption there is a risk that the counterparty will fail to perform or otherwise default on its obligations under the swaption contract.

     The Fund has purchased swaptions which gives it the option to enter into an interest rate swap in which it pays a fixed interest rate and receives a floating interest rate in order to decrease exposure to interest rate risk. A purchased swaption of this type becomes more valuable as the reference interest rate appreciates relative to the preset interest rate.

     The Fund has written swaptions which gives it the obligation, if exercised by the purchaser, to enter into an interest rate swap in which it pays a floating interest rate and receives a fixed interest rate in order to increase exposure to interest rate risk. A written swaption of this type becomes more valuable as the reference interest rate depreciates relative to the preset interest rate.

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NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

     The Fund has written swaptions which gives it the obligation, if exercised by the purchaser, to enter into an interest rate swap in which it pays a fixed interest rate and receives a floating interest rate in order to decrease exposure to interest rate risk. A written swaption of this type becomes more valuable as the reference interest rate appreciates relative to the preset interest rate.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $449,402 and $1,062,770 on purchased and written swaptions, respectively.

Written swaption activity for the year ended December 30, 2011 was as follows:

	Call Swaptions
	Notional		Amount of
	Amount		Premiums
Swaptions outstanding as of December 31, 2010	$	—	$	—
Swaptions written		385,315,000		8,188,797
Swaptions outstanding as of December 30, 2011	$	385,315,000	$	8,188,797

6. Restricted Securities

As of December 30, 2011, investments in securities included issues that are restricted. A restricted security may have a contractual restriction on its resale and is valued under methods approved by the Board of Directors as reflecting fair value. Securities that are restricted are marked with an applicable footnote on the Statement of Investments. Restricted securities are reported on a schedule following the Statement of Investments.

7. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

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     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Global Strategic Income Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Global Strategic Income Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian, transfer agent and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Global Strategic Income Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG LLP

Denver, Colorado
February 16, 2012

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FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Capital gain distributions of $0.06966 per share were paid to Non-Service and Service shareholders, respectively, on March 7, 2011. Whether received in stock or in cash, the capital gain distribution should be treated by shareholders as a gain from the sale of the capital assets held for more than one year (long-term capital gains).

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 0.32% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

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BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio managers and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Arthur Steinmetz, Krishna Memani, Joseph Welsh, and Sara Zervos the portfolio managers for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The

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Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s historical performance to relevant market indices and to the performance of other global income funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe median during the one- and ten-year Lipper periods, although the Fund underperformed its performance universe median during the three- and five-year Lipper periods. The Board also considered the Fund’s recent improved performance, noting it had ranked in the first quintile for the year to date ended April 30, 2011.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other global income funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees were equal to, and its total expenses were higher than, its expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.75% for Non-Service shares and 1.00% for Service shares. This voluntary expense limitation may be amended or withdrawn at any time.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates. The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

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PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

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TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees (since 2003), Trustee (since 1999) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 1999) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000-June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 1993) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 1996) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital

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TRUSTEES AND OFFICERS Unaudited / Continued

Beverly L. Hamilton, Continued	(2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997- February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2000) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999-March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005- March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003- March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005- December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

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OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Steinmetz, Memani, Welsh, Gabinet and Mss. Zervos and Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Welsh, Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Arthur P. Steinmetz, Vice President (since 1993) Age: 53	Chief Investment Officer of the Manager (since October 2010); Executive Vice President of the Manager (since October 2009). Chief Investment Officer of Fixed-Income Investments of the Manager (April 2009-October 2010); Director of Fixed-Income Investments of the Manager (January 2009-April 2009) and a Senior Vice President of the Manager (March 1993-September 2009). A portfolio manager and an officer of 5 portfolios in the OppenheimerFunds complex.
Krishna Memani, Vice President (since 2009) Age: 51	Director of Fixed Income (since October 2010), Senior Vice President and Head of the Investment Grade Fixed Income Team of the Manager (since March 2009). Prior to joining the Manager, Managing Director and Head of the U.S. and European Credit Analyst Team at Deutsche Bank Securities (June 2006-January 2009); Chief Credit Strategist at Credit Suisse Securities (August 2002-March 2006); a Managing Director and Senior Portfolio Manager at Putnam Investments (September 1998-June 2002). A portfolio manager and an officer of 22 portfolios in the OppenheimerFunds complex.
Joseph Welsh, Vice President (since 2009) Age: 47	Head of the Manager’s High Yield Corporate Debt Team (since April 2009); Senior Vice President of the Manager (since May 2009); Vice President of the Manager (December 2000-April 2009); Assistant Vice President of the Manager (December 1996-November 2000); a high yield bond analyst of the Manager (January 1995- December 1996); a CFA. A portfolio manager and officer of 6 portfolios in the OppenheimerFunds complex.
Sara J. Zervos, Ph.D., Vice President (since 2010) Age: 42	Head of the Global Debt Team (since October 2010); Senior Vice President of the Manager (since January 2011); Vice President of the Manager (April 2008-December 2010). Prior to joining the Manager, a portfolio manager with Sailfish Capital Management (May 2007-February 2008) and a portfolio manager for emerging market debt at Dillon Read Capital Management and OTA Asset Management (June 2004-April 2007). A portfolio manager and officer of 4 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003-October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.

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TRUSTEES AND OFFICERS Unaudited / Continued

Brian W. Wixted,
Treasurer and Principal
Financial & Accounting
Officer
(since 1999) Age: 52 Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

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Financial Statements for Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd. for the Period Ended December 30, 2011

90	Statement of Assets and Liabilities
91	Statement of Operations
92	Statement of Changes in Net Assets
93	Notes to Financial Statements
98	Report of Independent Registered Public Accounting Firm

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
STATEMENT OF ASSETS AND LIABILITIES December 30, 20111

Assets
Cash	$	1,498,774
Total assets		1,498,774
Liabilities
Payables and other liabilities:
Auditing and other professional fees		16,255
Total liabilities		16,255
Net Assets	$	1,482,519
Composition of Net Assets
Par value of shares of beneficial interest	$	150
Additional paid-in capital		1,499,850
Accumulated net investment loss		(17,481	)
Net Assets—applicable to 15,000 shares of beneficial interest outstanding	$	1,482,519
Net Asset Value, Redemption Price Per Share and Offering Price Per Share	$	98.83

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
STATEMENT OF OPERATIONS For the Period Ended December 30, 2011^1,2

Expenses
Management fees	$	1,226
Legal, auditing and other professional fees		16,255
Total expenses		17,481
Net Investment Loss		(17,481	)
Net Decrease in Net Assets Resulting from Operations	$	(17,481	)

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	For the period from November 21, 2011 (commencement of operations) to December 30, 2011.

See accompanying Notes to Financial Statements.

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
STATEMENT OF CHANGES IN NET ASSETS

Period Ended December 30,		2011	1,2
Operations
Net investment loss	$	(17,481	)
Net decrease in net assets resulting from operations		(17,481	)
Beneficial Interest Transactions
Net increase in net assets resulting from beneficial interest transactions		1,500,000
Net Assets
Total increase		1,482,519
Beginning of period		—
End of period (including accumulated net investment loss of $17,481 for the period ended December 30, 2011)	$	1,482,519

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	For the period from November 21, 2011 (commencement of operations) to December 30, 2011.

See accompanying Notes to Financial Statements.

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd. (the “Fund”) is organized as a Cayman Islands Company Limited by Shares. The Fund intends to carry on the business of an investment company and to acquire, invest in and hold by way of investment, sell and deal primarily in commodity-linked derivatives (including commodity futures, financial futures, options and swap contracts) and exchange traded funds (“ETF”). The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”). The Sub-Adviser is Oppenheimer Real Asset Management, Inc. (“ORAMI” or the “Sub-Adviser”), a wholly-owned subsidiary of the Manager. As of December 30, 2011, 100% of the Fund was owned by Oppenheimer Global Strategic Income Fund/VA (“OGSIFVA”). The Manager is also the investment adviser of OGSIFVA. The Fund commenced operations on November 21, 2011.

     The beneficial interest of each investor in the Fund is represented by units of participating shares. The Fund’s directors may further designate classes of participating shares and series within each class. As of December 30, 2011, the directors have not designated classes or series of outstanding participating shares. During the year ended December 30, 2011, all income, profits, losses and expenses, if any, of the Fund were allocated pro rata to all participating shares of the Fund. Issuance of additional participating shares is at the discretion of the Fund’s directors.

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Continued quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Income Taxes. The Fund has received an undertaking from the Government of the Cayman Islands exempting it from all local income, profits and capital gains taxes through September of 2030. No such taxes are levied in the Cayman Islands at the present time. The Fund is a Controlled Foreign Corporation under U.S. tax laws and as such is not subject to U.S. income tax. Therefore, the Fund is not required to record a tax provision.

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, if any, are declared and paid annually from the Fund’s tax basis earnings and profits. Distributions are recorded on ex-dividend date.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former directors and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s

94 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Capital Transactions

The Fund has authorized 5,000,000 participating shares of $0.01 par value per share. The Fund issued 15,000 participating shares for $1,500,000 on November 21, 2011 in conjunction with OGSI’s initial capitalization of the Fund. All subsequent capital contributions and withdrawals did not have participating shares associated with the transaction.

Capital transactions were as follows:

	Period Ended December 30, 20111
	Amount
Contributions	$	1,500,000
Withdrawals		—
Net increase	$	1,500,000

1. For the period from November 21, 2011 (commencement of operations) to December 30, 2011.

3. Expenses

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Next $200 million	0.60
Over $1 billion	0.50

Sub-Adviser Fees. The Manager retains the Sub-Adviser to provide the day-to-day portfolio management of the Fund. Under the Sub-Advisory Agreement, the Manager pays the Sub-Adviser a fee in monthly installments, based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.375	%
Next $200 million	0.360
Next $200 million	0.345
Next $200 million	0.330
Next $200 million	0.300
Over $1 billion	0.250

The Fund shall bear all fees and expenses related to the business and affairs of the Fund, including among others, directors’ fees, audit fees, custodian fees and expenses in connection with the purchase and sale of securities and other Fund assets.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

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OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.
NOTES TO FINANCIAL STATEMENTS Continued

4. Financial Highlights

The following represents the total return of the Fund for the period ended December 30, 2011. Total return was calculated based upon the daily returns of the Fund during this period. The calculation has not been annualized for reporting purposes:

Period Ended December 30, 20111                    (1.17)%

The following represents certain financial ratios of the Fund for the periods noted. The computation of the net investment income and total expense ratios was based upon the daily net assets of the Fund during these periods. The calculations have been annualized for reporting purposes:

	Period Ended
	December 30, 20111
Ratios to average net assets:
Net investment income (loss)		(10.44	)%
Total expenses		10.44	%

1. For the period from November 21, 2011 (commencement of operations) through December 30, 2011.

5. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of

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the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

6. Subsequent Events Evaluation

The Fund has evaluated the need for disclosures and/or adjustments resulting from subsequent events through February 16, 2012, the date the financial statements were available to be issued. This evaluation determined that there are no subsequent events that necessitated disclosures and/or adjustments.

97 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA (CAYMAN) LTD.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholder of Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd.:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd., including the statement of investments, as of December 30, 2011, and the related statement of operations and the statement of changes in net assets for the period from November 21, 2011 (commencement of operations) to December 30, 2011. These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

     We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Oppenheimer Global Strategic Income Fund/VA (Cayman) Ltd. as of December 30, 2011, the results of its operations and the changes in its net assets for the period from November 21, 2011 (commencement of operations) to December 30, 2011, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
February 16, 2012

98 | OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/VA

OPPENHEIMER GLOBAL STRATEGIC INCOME FUND/ VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates LLP
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

December 31, 2011 Oppenheimer Value Fund/VA Annual Report A Series of Oppenheimer Variable Account Funds ANNUAL REPORT Listing of Top Holdings Fund Performance Discussion Financial Statements

OPPENHEIMER VALUE FUND/ VA

Portfolio Manager: Mitch Williams, CFA

Average Annual Total Returns
For the Periods Ended 12/30/11¹

							Since
							Inception
	1-Year			5-Year			(1/2/03)
Non-Service Shares		-4.93	%		1.99	%	7.81%

							Since
							Inception
	1-Year			5-Year			(9/18/06)
Service Shares		-4.48	%		-2.15	%	-0.80%

Expense Ratios
For the Period Ended 12/30/11¹

	Gross		Net
	Expense		Expense
	Ratios		Ratios
Non-Service Shares	1.83	%	0.80	%
Service Shares	1.90		1.05

The performance data quoted represents past performance, which does not guarantee future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance and expense ratios may be lower or higher than the data quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account. The net expense ratios take into account voluntary fee waivers and/or expense reimbursements, without which performance would have been less. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus.

Sector Allocation

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on the total market value of common stocks.

Top Ten Common Stock Holdings
Chevron Corp.	5.9	%
Medtronic, Inc.	4.0
U.S. Bancorp	3.5
Coca-Cola Co. (The)	3.3
Wells Fargo & Co.	3.2
MetLife, Inc.	2.7
Gilead Sciences, Inc.	2.6
Goldman Sachs Group, Inc. (The)	2.6
Exxon Mobil Corp.	2.5
Pfizer, Inc.	2.5

Portfolio holdings and allocations are subject to change. Percentages are as of December 30, 2011, and are based on net assets.

2 | OPPENHEIMER VALUE FUND/VA

FUND PERFORMANCE DISCUSSION

Management’s Discussion of Fund Performance. The Fund’s Non-Service shares produced a total return of —4.93% during the reporting period ended December 30, 2011.1 On a relative basis, the Fund underperformed the Russell 1000 Value Index (the “Index”), which returned 0.39%. The bulk of the Fund’s declines occurred over the third quarter of 2011 when markets witnessed significant volatility. On a sector basis, the Fund underperformed the Index primarily in the industrials, utilities and information technology sectors due to weaker relative stock selection. The Fund outperformed the Index within the energy sector as a result of stronger relative stock selection and within the financials sector, where an underweight position to the worst performing sector of the Index benefited performance.

Economic and Market Overview

The reporting period began with a sense of market optimism over improving Gross Domestic Product (“GDP”) growth in Europe and the U.S., and equity markets in those regions overall experienced solid gains through the first four months of 2011. After strong gains in 2010, most developing market equities started the year off lagging their developed market counterparts due to concerns over slowing growth and rising inflation.

     Market volatility across global equity markets grew over the second quarter of 2011 when Greece again teetered on the brink of defaulting on its sovereign debt, rekindling worries that fiscal instability might spread to other parts of Europe. Concerns over the economic problems in other European countries intensified as did a sense of unease over the health of the European banking system. A natural disaster in Japan caused disruptions in supply chains in the information technology sector and the automotive industry. Previously high-flying economies such as Brazil, Australia and India saw their GDP numbers cool off significantly as they struggled to keep their economies from heading into recession. In the U.S., the Fed’s latest round of quantitative easing, labeled “QE2”, officially ended on June 30, adding to questions around what the Fed’s next move might be to help stimulate the U.S. economy. These developments, in addition to persistently high levels of U.S. unemployment and a depressed U.S. housing market, contributed to a weaker-than-expected estimate of U.S. GDP during the second quarter of the year.

     Due to the sluggish economy and lowered expectations for future economic growth, global equities began a decline over the summer that intensified as the third quarter progressed. The markets priced in a renewed sense of pessimism that Europe might succumb to a double-dip recession and that the U.S. was headed for a prolonged period of disappointing growth. Uncertainty and market nervousness grew as a deal to raise the U.S. debt ceiling was not reached until shortly before the deadline. As a result of the intense political wrangling, the credit rating agency Standard & Poor’s took the unprecedented and controversial step of downgrading the debt of the U.S., a decision that the two other major U.S. credit rating agencies opted not to follow. These events, coupled with the high likelihood of a Greek default on its debt and worries that Italy might be next, sent stocks sharply lower over the third quarter of 2011.

     In the fourth quarter, equity markets finished the period largely on a positive note, rebounding strongly in October in particular, as European leaders sought to undertake measures to address the debt issues in the region and the U.S. economy began to show some signs of life as high unemployment trended downward, the housing market picked up slightly and consumer sentiment improved.

Top Individual Contributors

Two top performing holdings for the Fund this period were health care stocks Humana, Inc. and Pfizer, Inc. As fears over the new health care overhaul abated to a degree, the market generally responded more positively to health care stocks. Humana is a leading Medicare provider in the U.S. and in 2011 expanded its base of operations as well as Medicare Advantage policyholders through a series of acquisitions, including deals to acquire Antiva Health, MD Care, Arcadian Management Services, SeniorBridge and several urgent medical centers from NextCare, Inc. through its subsidiary Concentra, Inc. Pharmaceutical giant Pfizer performed well on continued strong sales of its popular drug Lipitor as well as positive top-line data of Lyrica from a phase III study and its evaluation for possible use in additional indications. During the period, Pfizer completed acquisitions of Excaliard Pharmaceuticals, Inc. and Ferrosan Consumer Health.

     Several energy sector holdings also produced positive results for the Fund, including Chevron Corp., Exxon Mobil Corp. and Halliburton Co. Chevron and Exxon benefited from the rising price of oil and natural gas both early in the

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

3 | OPPENHEIMER VALUE FUND/VA

FUND PERFORMANCE DISCUSSION

period and as the period came to a close, after a significant dip in prices over the middle of the period. Chevron announced a new natural discovery by its Australian unit and outlined plans for 2012 to be a year of major investment for the company in large natural gas-related exploration and production projects. Exxon continued to seek new growth opportunities in its exploration and production efforts and continued building upon its already impressive revenue stream. Energy-services company Halliburton performed well early in the period and we closed out of our position.

     Within the consumer staples sector, household products manufacturer Church & Dwight Co., Inc. performed well as the market reacted positively to its solid increase in profit and plan to raise prices on selected products. Lastly, information technology stock National Semiconductor Corp. contributed significantly to performance as it was acquired by Texas Instruments during the period. The Fund did not hold a position in Texas Instruments at period end.

Top Individual Detractors

The Goldman Sachs Group, Inc. was the most significant detractor from performance this reporting period. Goldman’s stock price declined primarily due to increased regulation in the financial industry and uncertainty over its eventual implementation, which reduced the outlook for profit growth for many financial firms, particularly in the investment banking sector. A weak global economy and investment banks’ exposure to the Eurozone also gave investors pause. Other holdings in the financials sector that hurt performance this period included MetLife, Inc. and JPMorgan Chase & Co.

     Within industrials, the negative market outlook for machinery companies in a weakening global economy resulted in declines for the Fund’s position in Ingersoll-Rand, which experienced a shortfall in expected demand for its HVAC (heating, ventilation and air conditioning) products. We exited our position in the stock by period end. Consumer discretionary stock Ford Motor Co. came under selling pressure, due in part to rising concern that consumer spending would suffer in the event of a double-dip recession. The Fund also experienced declines through its investment in information technology stock Research in Motion Ltd. Research in Motion issued a weak performance outlook and quarterly results, and also announced a delay in its next generation of BlackBerry smartphones. We exited our position.

Outlook

At period end, investors generally remain wary of risk. The markets are pricing in a great deal of uncertainty, whether that uncertainty lies with the outcomes of the debates in the U.S. Congress over debt reduction or the political upheavals across much of Europe. Weak GDP numbers in multiple regions of the globe have raised questions around whether the fragile global economic recovery has reversed course and begun a slide back into recession. Concerns exist that slow or negative growth will negatively impact consumer sentiment and spending habits, leading to further weakness in the global economy and the markets.

     Improving unemployment figures in the U.S. offer some degree of optimism for the U.S economy. Measures being undertaken in Europe to shore up the euro and the Eurozone may help to stem in 2012 some of the significant market volatility we saw in 2011. Despite the market volatility we have witnessed of late, we remain confident in our investment approach. We will continue to search for companies that, in our view, offer strong earnings prospects and are trading at attractive valuations. We believe that moments like these can lead to significant investment opportunities where solid companies are undervalued and which we can purchase at a bargain price. While current global political and economic conditions are causing significant market fluctuations, we have not changed our long-term approach to investing and believe that reacting strongly to short-term market gyrations is rarely warranted or a prudent investment strategy.

Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

Total returns include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown.

The Fund’s investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc.

4 | OPPENHEIMER VALUE FUND/VA

Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Comparing the Fund’s Performance to the Market. The graphs that follow show the performance of a hypothetical $10,000 investment in each share class of the Fund held until December 30, 2011. In the case of Non-Service shares, performance is measured from inception of the Class on January 2, 2003. In the case of Service shares, performance is measured from inception of the Class on September 18, 2006. Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graphs assume that all dividends and capital gains distributions were reinvested in additional shares.

     The Fund’s performance is compared to the performance of the Russell 1000 Value Index, an unmanaged index of equity securities of large capitalization value companies. Index performance includes reinvestment of income but does not reflect transaction costs, fees or expenses. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the securities comprising the index.

5 | OPPENHEIMER VALUE FUND/VA

FUND PERFORMANCE DISCUSSION

Non-Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

Service Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:

The performance data quoted represents past performance, which does not guarantee future results.

The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month end, call us at 1.800.988.8287. The Fund’s total returns should not be expected to be the same as the returns of other funds, whether or not both funds have the same portfolio managers and/or similar names. The Fund’s total returns do not include the charges associated with the separate account products that offer this Fund. Such performance would have been lower if such charges were taken into account.

1. December 30, 2011 was the last business day of the Fund’s fiscal year. See Note 1 of the accompanying Notes to Financial Statements. Index returns are calculated through December 31, 2011.

6 | OPPENHEIMER VALUE FUND/VA

FUND EXPENSES

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended December 30, 2011.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any charges associated with the separate accounts that offer this Fund. Therefore, the “hypothetical” lines of the table are useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these separate account charges were included your costs would have been higher.

	Beginning		Ending		Expenses
	Account		Account		Paid During
	Value		Value		6 Months Ended
	July 1, 2011		December 30, 2011		December 30, 2011
Actual
Non-Service shares	$	1,000.00	$	886.90	$	3.79
Service shares		1,000.00		903.10		5.02
Hypothetical
(5% return before expenses)
Non-Service shares		1,000.00		1,021.06		4.06
Service shares		1,000.00		1,019.80		5.33

Expenses are equal to the Fund’s annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated fund, based on the 6-month period ended December 30, 2011 are as follows:

Class	Expense Ratios
Non-Service shares		0.80	%
Service shares		1.05

The expense ratios reflect voluntary waivers and/or reimbursements of expenses by the Fund’s Manager. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund’s prospectus. The “Financial Highlights” tables in the Fund’s financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

7 | OPPENHEIMER VALUE FUND/VA

STATEMENT OF INVESTMENTS December 30, 2011*

	Shares		Value
Common Stocks—95.1%
Consumer Discretionary—9.6%
Automobiles—1.5%
Ford Motor Co.1		9,900	$	106,524
Household Durables—1.9%
Mohawk Industries, Inc.1		2,270		135,860
Media—3.6%
Comcast Corp., Cl. A		6,700		158,857
Viacom, Inc., Cl. B		1,990		90,366
				249,223
Multiline Retail—2.2%
Target Corp.		3,030		155,197
Specialty Retail—0.4%
Talbots, Inc. (The)1		10,180		27,079
Consumer Staples—8.0%
Beverages—3.3%
Coca-Cola Co. (The)		3,330		233,000
Food & Staples Retailing—2.2%
Wal-Mart Stores, Inc.		2,580		154,181
Household Products—2.5%
Church & Dwight Co., Inc.		3,710		169,770
Energy—12.8%
Energy Equipment & Services—0.7%
Nabors Industries Ltd.1		2,930		50,806
Oil, Gas & Consumable Fuels—12.1%
Apache Corp.		700		63,406
Chevron Corp.		3,890		413,896
Exxon Mobil Corp.		2,094		177,487
Penn West Petroleum Ltd.		3,930		77,814
Royal Dutch Shell plc, ADR		1,530		111,828
				844,431
Financials—20.2%
Capital Markets—2.6%
Goldman Sachs Group, Inc. (The)		2,010		181,764
Commercial Banks—10.4%
CIT Group, Inc.1		3,320		115,768
M&T Bank Corp.		1,860		141,992
U.S. Bancorp		8,940		241,827
Wells Fargo & Co.		8,130		224,063
				723,650
Diversified Financial Services—2.2%
JPMorgan Chase & Co.		4,580		152,285
Insurance—5.0%
ACE Ltd.		2,310		161,977
MetLife, Inc.		6,080		189,574
				351,551
Health Care—15.7%
Biotechnology—2.6%
Gilead Sciences, Inc.1		4,450		182,139
Health Care Equipment & Supplies—4.0%
Medtronic, Inc.		7,380		282,285
Health Care Providers & Services—6.6%
HCA Holdings, Inc.1		5,420		119,403
Humana, Inc.		1,640		143,680
UnitedHealth Group, Inc.		2,270		115,044
WellPoint, Inc.		1,230		81,488
				459,615
Pharmaceuticals—2.5%
Pfizer, Inc.		8,150		176,366
Industrials—5.7%
Electrical Equipment—2.2%
Cooper Industries plc		2,840		153,786
Industrial Conglomerates—2.1%
Tyco International Ltd.		3,090		144,334
Trading Companies & Distributors—1.4%
AerCap Holdings NV1		9,010		101,723
Information Technology—9.0%
Communications Equipment—1.7%
Juniper Networks, Inc.1		5,790		118,174
Computers & Peripherals—0.9%
Hewlett-Packard Co.		2,570		66,203
Internet Software & Services—1.1%
VeriSign, Inc.		2,270		81,084
Semiconductors & Semiconductor Equipment—1.2%
Xilinx, Inc.		2,590		83,035
Software—4.1%
Microsoft Corp.		6,100		158,356
Oracle Corp.		4,890		125,429
				283,785
Materials—4.1%
Chemicals—2.6%
Celanese Corp., Series A		1,760		77,915
Mosaic Co. (The)		1,980		99,851
				177,766
Containers & Packaging—1.5%
Rock-Tenn Co., Cl. A		1,840		106,168
Telecommunication Services—2.9%
Diversified Telecommunication Services—1.3%
AT&T, Inc.		2,912		88,059
Wireless Telecommunication Services—1.6%
Vodafone Group plc, Sponsored ADR		4,130		115,764

8 | OPPENHEIMER VALUE FUND/VA

	Shares		Value
Utilities—7.1%
Electric Utilities—3.5%
American Electric Power Co., Inc.		2,110	$	87,164
Edison International, Inc.		3,720		154,008
				241,172
Energy Traders—1.3%
GenOn Energy, Inc.1		33,520		87,487
Multi-Utilities—2.3%
Public Service Enterprise Group, Inc.		4,970		164,059
Total Common Stocks (Cost $6,390,152)				6,648,325

	Expiration		Strike
	Date		Price		Contracts
Options Purchased—0.1%
Chicago Board Options Exchange Volatility Index Call1		1/18/12	$	40.000		30	1,200
Chicago Board Options Exchange Volatility Index Call1		1/18/12		42.500		20	700
Chicago Board Options Exchange Volatility Index Call1		2/15/12		40.000		20	2,000
Chicago Board Options Exchange Volatility Index Call1		2/15/12		42.500		10	800
Total Options Purchased (Cost $18,849)							4,700

	Shares			Value
Investment Company—5.3%
Oppenheimer Institutional Money Market Fund, Cl. E, 0.20%2,3 (Cost $374,186)		374,186		$	374,186
Total Investments, at Value (Cost $6,783,187)		100.5	%		7,027,211
Liabilities in Excess of Other Assets		(0.5	)		(37,778	)
Net Assets		100.0	%	$	6,989,433

Footnotes to Statement of Investments

*	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
1.	Non-income producing security.
2.	Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended December 30, 2011, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:

	Shares		Gross		Gross		Shares
	December 31, 2010		Additions		Reductions		December 30, 2011
Oppenheimer Institutional Money Market Fund, Cl. E		230,823		3,758,508		3,615,145		374,186

	Value		Income
Oppenheimer Institutional Money Market Fund, Cl. E	$	374,186	$	623

3. Rate shown is the 7-day yield as of December 30, 2011.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1)	Level 1—unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)
2)	Level 2—inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)
3)	Level 3—significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

9 | OPPENHEIMER VALUE FUND/VA

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued

The table below categorizes amounts that are included in the Fund’s Statement of Assets and Liabilities as of December 30, 2011 based on valuation input level:

					Level 3–
	Level 1–		Level 2–		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted Prices		Observable Inputs		Inputs		Value
Assets Table
Investments, at Value:
Common Stocks
Consumer Discretionary	$	673,883	$	—	$	—	$	673,883
Consumer Staples		556,951		—		—		556,951
Energy		895,237		—		—		895,237
Financials		1,409,250		—		—		1,409,250
Health Care		1,100,405		—		—		1,100,405
Industrials		399,843		—		—		399,843
Information Technology		632,281		—		—		632,281
Materials		283,934		—		—		283,934
Telecommunication Services		203,823		—		—		203,823
Utilities		492,718		—		—		492,718
Options Purchased		4,700		—		—		4,700
Investment Company		374,186		—		—		374,186
Total Assets	$	7,027,211	$	—	$	—	$	7,027,211

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund’s investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

See accompanying Notes to Financial Statements.

10 | OPPENHEIMER VALUE FUND/VA

STATEMENT OF ASSETS AND LIABILITIES December 30, 2011¹

Assets
Investments, at value—see accompanying statement of investments:
Unaffiliated companies (cost $6,409,001)	$	6,653,025
Affiliated companies (cost $374,186)		374,186
		7,027,211
Cash		10,940
Receivables and other assets:
Dividends		11,609
Other		6,985
Total assets		7,056,745
Liabilities
Payables and other liabilities:
Shares of beneficial interest redeemed		22,042
Legal, auditing and other professional fees		20,001
Shareholder communications		15,426
Trustees’ compensation		5,055
Distribution and service plan fees		1,410
Transfer and shareholder servicing agent fees		594
Other		2,784
Total liabilities		67,312
Net Assets	$	6,989,433
Composition of Net Assets
Par value of shares of beneficial interest	$	724
Additional paid-in capital		8,021,828
Accumulated net investment income		75,254
Accumulated net realized loss on investments and foreign currency transactions		(1,352,402	)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies		244,029
Net Assets	$	6,989,433
Net Asset Value Per Share
Non-Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $104,481 and 13,056 shares of beneficial interest outstanding)	$	8.00
Service Shares:
Net asset value, redemption price per share and offering price per share (based on net assets of $6,884,952 and 710,734 shares of beneficial interest outstanding)	$	9.69

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

11 | OPPENHEIMER VALUE FUND/VA

STATEMENT OF OPERATIONS For the Year Ended December 30, 2011₁

Investment Income
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $1,691)	$	160,618
Affiliated companies		623
Interest		5
Total investment income		161,246
Expenses
Management fees		56,629
Distribution and service plan fees — Service shares		18,625
Transfer and shareholder servicing agent fees:
Non-Service shares		101
Service shares		7,450
Shareholder communications:
Non-Service shares		352
Service shares		21,015
Legal, auditing and other professional fees		23,480
Trustees’ compensation		7,567
Administration service fees		1,500
Custodian fees and expenses		677
Other		6,089
Total expenses		143,485
Less waivers and reimbursements of expenses		(64,465	)
Net expenses		79,020
Net Investment Income		82,226
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments from unaffiliated companies		605,487
Closing and expiration of option contracts written		(4,653	)
Foreign currency transactions		40
Net realized gain		600,874
Net change in unrealized appreciation/depreciation on:
Investments		(1,040,606	)
Translation of assets and liabilities denominated in foreign currencies		5
Net change in unrealized appreciation/depreciation		(1,040,601	)
Net Decrease in Net Assets Resulting from Operations	$	(357,501	)

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

12 | OPPENHEIMER VALUE FUND/VA

STATEMENTS OF CHANGES IN NET ASSETS

	Year Ended			Year Ended
	December 30,			December 31,
	20111			2010
Operations
Net investment income	$	82,226		$	60,182
Net realized gain		600,874			524,533
Net change in unrealized appreciation/depreciation		(1,040,601	)		356,769
Net increase (decrease) in net assets resulting from operations		(357,501	)		941,484
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares		(904	)		(479	)
Service shares		(66,745	)		(64,271	)
		(67,649	)		(64,750	)
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Non-Service shares		17,714			42,114
Service shares		(6,322	)		(1,058,473	)
		11,392			(1,016,359	)
Net Assets
Total decrease		(413,758	)		(139,625	)
Beginning of period		7,403,191			7,542,816
End of period (including accumulated net investment income of $75,254 and $60,637, respectively)	$	6,989,433		$	7,403,191

1. December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

13 | OPPENHEIMER VALUE FUND/VA

FINANCIAL HIGHLIGHTS

	Year Ended
	December 30,									Year Ended December 31,
Non-Service Shares	20111			2010			2009			2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	8.49		$	7.22		$	4.99		$	11.73		$	11.58
Income (loss) from investment operations:
Net investment income2		.15			.11			.11			.12			.10
Net realized and unrealized gain (loss)		(.56	)		1.24			2.14			(4.44	)		.59
Total from investment operations		(.41	)		1.35			2.25			(4.32	)		.69
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.08	)		(.08	)		(.02	)		(2.42	)		(.10	)
Distributions from net realized gain		—			—			—			—			(.44	)
Total dividends and/or distributions to shareholders		(.08	)		(.08	)		(.02	)		(2.42	)		(.54	)
Net asset value, end of period	$	8.00		$	8.49		$	7.22		$	4.99		$	11.73
Total Return, at Net Asset Value3		(4.93	)%		18.85	%		45.08	%		(36.43	)%		5.89	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	104		$	92		$	38		$	6		$	1,728
Average net assets (in thousands)	$	101		$	57		$	20		$	857		$	2,753
Ratios to average net assets:4
Net investment income		1.78	%		1.46	%		1.75	%		1.07	%		0.80	%
Total expenses5		1.83	%		2.05	%		2.30	%		1.48	%		1.49	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		0.80	%		0.57	%		0.85	%		1.25	%		1.25	%
Portfolio turnover rate		86	%		109	%		122	%		175	%		142	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.83	%
Year Ended December 31, 2010	2.05	%
Year Ended December 31, 2009	2.31	%
Year Ended December 31, 2008	1.48	%
Year Ended December 31, 2007	1.49	%

See accompanying Notes to Financial Statements.

14 | OPPENHEIMER VALUE FUND/VA

	Year Ended
	December 30,											Year Ended December 31,
Service Shares	20111			2010				2009					2008			2007
Per Share Operating Data
Net asset value, beginning of period	$	10.23			$	8.99			$	6.79		$	11.75		$	11.57
Income (loss) from investment operations:
Net investment income2		.11				.08				.09			.08			.06
Net realized and unrealized gain (loss)		(.56	)			1.24				2.12			(4.97	)		.60
Total from investment operations		(.45	)			1.32				2.21			(4.89	)		.66
Dividends and/or distributions to shareholders:
Dividends from net investment income		(.09	)			(.08	)			(.01	)		(.07	)		(.04	)
Distributions from net realized gain		—				—				—			—			(.44	)
Total dividends and/or distributions to shareholders		(.09	)			(.08	)			(.01	)		(.07	)		(.48	)
Net asset value, end of period	$	9.69			$	10.23			$	8.99		$	6.79		$	11.75
Total Return, at Net Asset Value3		(4.48	)%			14.81	%			32.57	%		(41.62	)%		5.70	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	6,885			$	7,311			$	7,505		$	4,690		$	6,481
Average net assets (in thousands)	$	7,449			$	7,008			$	5,501		$	5,561		$	3,527
Ratios to average net assets:4
Net investment income		1.08	%			0.85	%			1.10	%		0.84	%		0.49	%
Total expenses5		1.90	%			2.08	%			2.17	%		2.13	%		1.63	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.05	%			0.93	%			1.15	%		1.50	%		1.50	%
Portfolio turnover rate		86	%			109	%			122	%		175	%		142	%

1.	December 30, 2011 represents the last business day of the Fund’s 2011 fiscal year. See Note 1 of the accompanying Notes.
2.	Per share amounts calculated based on the average shares outstanding during the period.
3.	Assumes an 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 less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
4.	Annualized for periods less than one full year.
5.	Total expenses including indirect expenses from affiliated fund were as follows:

Year Ended December 30, 2011	1.90	%
Year Ended December 31, 2010	2.08	%
Year Ended December 31, 2009	2.18	%
Year Ended December 31, 2008	2.13	%
Year Ended December 31, 2007	1.63	%

See accompanying Notes to Financial Statements.

15 | OPPENHEIMER VALUE FUND/VA

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer Value Fund/VA (the “Fund”) is a separate series of Oppenheimer Variable Account Funds, an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s investment objective is to seek long-term growth of capital by investing primarily in common stocks with low price earnings ratios and better-than-anticipated earnings. Realization of current income is a secondary consideration. The Fund’s investment adviser is OppenheimerFunds, Inc. (the “Manager”).

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

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

Fiscal Year End. Since December 30, 2011 represents the last day during the Fund’s 2011 fiscal year on which the New York Stock Exchange was open for trading, the Fund’s financial statements have been presented through that date to maintain consistency with the Fund’s net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the “Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading.

     Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as “Level 1,” observable market inputs other than unadjusted quoted prices are classified as “Level 2” and significant unobservable inputs, including the Manager’s judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as “Level 3.” The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund’s investments under these levels of classification is included following the Statement of Investments.

     Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

     Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund’s assets are valued. Securities whose principal exchange is NASDAQ^® are valued based on the official closing prices reported by NASDAQ prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day’s closing “bid” and “asked” prices, and if not, at the current day’s closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund’s assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

     Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

     U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and “money market-type” debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the “bid” and “asked” prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

16 | OPPENHEIMER VALUE FUND/VA

     “Money market-type” debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

     In the absence of a current price quotation obtained from an independent pricing service or broker-dealer, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund’s assets are valued but after the close of the securities’ respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

     There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Investment in Oppenheimer Institutional Money Market Fund. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund (“IMMF”) to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. When applicable, the Fund’s investment in IMMF is included in the Statement of Investments. Shares of IMMF are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of IMMF’s Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF.

Foreign Currency Translation. The Fund’s accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Trustees.

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

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

Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class.

17 | OPPENHEIMER VALUE FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Federal Taxes. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund’s tax return filings generally remain open for the three preceding fiscal reporting period ends.

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

							Net Unrealized
							Appreciation
							Based on Cost of
							Securities and
Undistributed	Undistributed			Accumulated			Other Investments
Net Investment	Long-Term			Loss			for Federal Income
Income	Gain			Carryforward1,2,3,4			Tax Purposes
$82,579		$	—		$	1,290,536		$	179,891

1. As of December 30, 2011, the Fund had $1,204,711 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. Details of the capital loss carryforwards are included in the table below. Capital loss carryovers with no expiration, if any, must be utilized prior to those with expiration dates.

Expiring
2016	$	204,829
2017		999,882
Total	$	1,204,711

2.	As of December 30, 2011, the Fund had $85,825 of post-October losses available to offset future realized capital gains, if any.
3.	During the fiscal year ended December 30, 2011, the Fund utilized $652,156 of capital loss carryforward to offset capital gains realized in that fiscal year.
4.	During the fiscal year ended December 31, 2010, the Fund utilized $446,612 of capital loss carryforward to offset capital gains realized in that fiscal year.

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

Accordingly, the following amounts have been reclassified for December 30, 2011. Net assets of the Fund were unaffected by the reclassifications.

	Increase
Increase	to Accumulated
to Accumulated	Net Realized
Net Investment	Loss on
Income	Investments
$40		$	40

The tax character of distributions paid during the years ended December 30, 2011 and December 31, 2010 was as follows:

	Year Ended			Year Ended
	December 30, 2011			December 31, 2010
Distributions paid from:
Ordinary income		$	67,649		$	64,750

The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of December 30, 2011 are noted in the following

18 | OPPENHEIMER VALUE FUND/VA

table. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss.

Federal tax cost of securities	$	6,861,475
Federal tax cost of other investments		(14,150	)
Total federal tax cost	$	6,847,325
Gross unrealized appreciation	$	667,294
Gross unrealized depreciation		(487,403	)
Net unrealized appreciation	$	179,891

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

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager.

Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

Custodian Fees. “Custodian fees and expenses” in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The “Reduction to custodian expenses” line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings.

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

Indemnifications. The Fund’s organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts

19 | OPPENHEIMER VALUE FUND/VA

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

2. Shares of Beneficial Interest

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

	Year Ended December 30, 2011						Year Ended December 31, 2010
	Shares			Amount			Shares			Amount
Non-Service Shares
Sold		4,906		$	40,931			6,745		$	50,146
Dividends and/or distributions reinvested		101			904			65			479
Redeemed		(2,787	)		(24,121	)		(1,196	)		(8,511	)
Net increase		2,220		$	17,714			5,614		$	42,114
Service Shares
Sold		114,846		$	1,183,318			108,649		$	1,008,324
Dividends and/or distributions reinvested		6,285			66,745			7,063			64,271
Redeemed		(125,191	)		(1,256,385	)		(235,966	)		(2,131,068	)
Net decrease		(4,060	)	$	(6,322	)		(120,254	)	$	(1,058,473	)

3. Purchases and Sales of Securities

The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended December 30, 2011, were as follows:

	Purchases		Sales
Investment securities	$	6,276,087	$	6,309,695

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:

Fee Schedule
Up to $200 million	0.75	%
Next $200 million	0.72
Next $200 million	0.69
Next $200 million	0.66
Over $800 million	0.60

Administration Service Fees. The Fund pays the Manager a fee of $1,500 per year for preparing and filing the Fund’s tax returns.

Transfer Agent Fees. OppenheimerFunds Services (“OFS”), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. For the year ended December 30, 2011, the Fund paid $7,566 to OFS for services to the Fund.

Distribution and Service Plan for Service Shares. The Fund has adopted a Distribution and Service Plan (the “Plan”) in accordance with Rule 12b-1 under the Investment Company Act of 1940 for Service shares to pay OppenheimerFunds Distributor, Inc. (the “Distributor”), for distribution related services, personal service and account maintenance for the

20 | OPPENHEIMER VALUE FUND/VA

Fund’s Service shares. Under the Plan, payments are made periodically at an annual rate of 0.25% of the daily net assets of Service shares of the Fund. The Distributor currently uses all of those fees to compensate sponsors of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. These fees are paid out of the Fund’s assets on an on-going basis and increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service shares and 1.05% for Service shares. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $1,028 and $63,072 for Non-Service and Service shares, respectively.

     The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in IMMF. During the year ended December 30, 2011, the Manager waived fees and/or reimbursed the Fund $365 for IMMF management fees.

     Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Risk Exposures and the Use of Derivative Instruments

The Fund’s investment objectives not only permit the Fund to purchase investment securities, they also allow the Fund to enter into various types of derivatives contracts, including, but not limited to, futures contracts, forward foreign currency exchange contracts, credit default swaps, interest rate swaps, total return swaps, and purchased and written options. In doing so, the Fund will employ strategies in differing combinations to permit it to increase, decrease, or change the level or types of exposure to market risk factors. Central to those strategies are features inherent to derivatives that make them more attractive for this purpose than equity and debt securities: they require little or no initial cash investment, they can focus exposure on only certain selected risk factors, and they may not require the ultimate receipt or delivery of the underlying security (or securities) to the contract. This may allow the Fund to pursue its objectives more quickly and efficiently than if it were to make direct purchases or sales of securities capable of effecting a similar response to market factors.

Market Risk Factors. In accordance with its investment objectives, the Fund may use derivatives to increase or decrease its exposure to one or more of the following market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, higher-quality bonds.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

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

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NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

The Fund’s actual exposures to these market risk factors during the period are discussed in further detail, by derivative type, below.

Risks of Investing in Derivatives. The Fund’s use of derivatives can result in losses due to unanticipated changes in the market risk factors and the overall market. In instances where the Fund is using derivatives to decrease, or hedge, exposures to market risk factors for securities held by the Fund, there are also risks that those derivatives may not perform as expected resulting in losses for the combined or hedged positions.

     Derivatives may have little or no initial cash investment relative to their market value exposure and therefore can produce significant gains or losses in excess of their cost. This use of embedded leverage allows the Fund to increase its market value exposure relative to its net assets and can substantially increase the volatility of the Fund’s performance.

     Additional associated risks from investing in derivatives also exist and potentially could have significant effects on the valuation of the derivative and the Fund. Typically, the associated risks are not the risks that the Fund is attempting to increase or decrease exposure to, per its investment objectives, but are the additional risks from investing in derivatives. Examples of these associated risks are liquidity risk, which is the risk that the Fund will not be able to sell the derivative in the open market in a timely manner, and counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. Associated risks can be different for each type of derivative and are discussed by each derivative type in the notes that follow.

Counterparty Credit Risk. Certain derivative positions are subject to counterparty credit risk, which is the risk that the counterparty will not fulfill its obligation to the Fund. The Fund’s derivative counterparties are financial institutions who are subject to market conditions that may weaken their financial position. The Fund intends to enter into financial transactions with counterparties that the Manager believes to be creditworthy at the time of the transaction.

Credit Related Contingent Features. The Fund’s agreements with derivative counterparties have several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern certain positions in swaps, over-the-counter options and swaptions, and forward currency exchange contracts for each individual counterparty.

Valuations of derivative instruments as of December 30, 2011 are as follows:

	Asset Derivatives
Derivatives Not Accounted for
as Hedging Instruments	Statement of Assets and Liabilities Location	Value
Volatility contracts	Investments, at value	$4,700*

* Amounts relate to purchased options.

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The effect of derivative instruments on the Statement of Operations is as follows:

Amount of Realized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted for	Investments from			Closing and expiration of
as Hedging Instruments	unaffiliated companies*			option contracts written			Total
Equity contracts	$	21,613		$	(4,653	)	$	16,960
Volatility contracts		(1,137	)		—			(1,137	)
Total	$	20,476		$	(4,653	)	$	15,823

* Includes purchased option contracts, purchased swaption contracts and written option contracts exercised, if any.

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives
Derivatives Not Accounted
for as Hedging Instruments	Investments*
Volatility contracts	$	(14,149	)

* Includes purchased option contracts and purchased swaption contracts, if any.

Option Activity

The Fund may buy and sell put and call options, or write put and call options. When an option is written, the Fund receives a premium and becomes obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option.

     Options are valued daily based upon the last sale price on the principal exchange on which the option is traded. The difference between the premium received or paid, and market value of the option, is recorded as unrealized appreciation or depreciation. The net change in unrealized appreciation or depreciation is reported in the Statement of Operations. When an option is exercised, the cost of the security purchased or the proceeds of the security sale are adjusted by the amount of premium received or paid. Upon the expiration or closing of the option transaction, a gain or loss is reported in the Statement of Operations.

     The Fund has purchased put options on individual equity securities and/or equity indexes to decrease exposure to equity risk. A purchased put option becomes more valuable as the price of the underlying financial instrument depreciates relative to the strike price.

     The Fund has purchased call options on volatility indexes to increase exposure to volatility risk. A purchased call option becomes more valuable as the level of the underlying volatility index increases relative to the strike price.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $2,884 and $567 on purchased call options and purchased put options, respectively.

     Options written, if any, are reported in a schedule following the Statement of Investments and as a liability in the Statement of Assets and Liabilities. Securities held in collateralized accounts to cover potential obligations with respect to outstanding written options are noted in the Statement of Investments.

     The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk that there may be an illiquid market where the Fund is unable to close the contract.

     The Fund has written put options on individual equity securities and/or equity indexes to increase exposure to equity risk. A written put option becomes more valuable as the price of the underlying financial instrument appreciates relative to the strike price.

     During the year ended December 30, 2011, the Fund had an ending monthly average market value of $90 on written put options.

     Additional associated risks to the Fund include counterparty credit risk for over-the-counter options and liquidity risk.

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NOTES TO FINANCIAL STATEMENTS Continued

5. Risk Exposures and the Use of Derivative Instruments Continued

Written option activity for the year ended December 30, 2011 was as follows:

	Put Options
	Number of Contracts			Amount of Premiums
Options outstanding as of December 31, 2010		—		$	—
Options written		24			940
Options closed or expired		(24	)		(940	)
Options outstanding as of December 30, 2011		—		$	—

6. Pending Litigation

Since 2009, a number of class action, derivative and individual lawsuits have been pending in federal and state courts against OppenheimerFunds, Inc., the Fund’s investment advisor (the “Manager”), OppenheimerFunds Distributor, Inc., the Fund’s principal underwriter and distributor (the “Distributor”), and certain funds (but not including the Fund) advised by the Manager and distributed by the Distributor (the “Defendant Funds”). Several of these lawsuits also name as defendants certain officers and current and former trustees of the respective Defendant Funds. The lawsuits raise claims under federal securities laws and various states’ securities, consumer protection and common law and allege, among other things, that the disclosure documents of the respective Defendant Funds contained misrepresentations and omissions and that the respective Defendant Funds’ investment policies were not followed. The plaintiffs in these actions seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. On September 30, 2011, the U.S. District Court for the District of Colorado entered orders and final judgments approving the settlement of certain putative class actions involving two Defendant Funds, Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund. Those orders are not subject to further appeal. These settlements do not resolve other outstanding lawsuits relating to Oppenheimer Champion Income Fund and Oppenheimer Core Bond Fund, nor do the settlements affect certain other putative class action lawsuits pending in federal court against the Manager, the Distributor, and other Defendant Funds and their independent trustees.

     In 2009, what are claimed to be derivative lawsuits were filed in New Mexico state court against the Manager and a subsidiary (but not against the Fund) on behalf of the New Mexico Education Plan Trust challenging a settlement reached in 2010 between the Manager, its subsidiary and the Distributor and the board of the New Mexico section 529 college savings plan. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys’ fees and litigation expenses. On September 9, 2011, the court denied plaintiffs’ request for a hearing to determine the fairness of the settlement, finding that plaintiffs lacked standing to pursue derivative claims on behalf of the Trust. On October 27, 2011, the parties to these actions filed a joint motion to dismiss the lawsuits with prejudice, which the court granted on October 28, 2011.

     Other class action and individual lawsuits have been filed since 2008 in various state and federal courts against the Manager and certain of its affiliates by investors seeking to recover investments they allegedly lost as a result of the “Ponzi” scheme run by Bernard L. Madoff and his firm, Bernard L. Madoff Investment Securities, LLC (“BLMIS”). Plaintiffs in these suits allege that they suffered losses as a result of their investments in several funds managed by an affiliate of the Manager and assert a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and awards of attorneys’ fees and litigation expenses. Neither the Distributor, nor any of the Oppenheimer mutual funds, their independent trustees or directors are named as defendants in these lawsuits. None of the Oppenheimer mutual funds invested in any funds or accounts managed by Madoff or BLMIS. On February 28, 2011, a stipulation of partial settlement of three groups of consolidated putative class action lawsuits relating to these

24 | OPPENHEIMER VALUE FUND/VA

matters was filed in the U.S. District Court for the Southern District of New York. On August 19, 2011, the court entered an order and final judgment approving the settlement as fair, reasonable and adequate. In September 2011, certain parties filed notices of appeal from the court’s order approving the settlement. On July 29, 2011, a stipulation of settlement between certain affiliates of the Manager and the Trustee appointed under the Securities Investor Protection Act to liquidate BLMIS was filed in the U.S. Bankruptcy Court for the Southern District of New York to resolve purported preference and fraudulent transfer claims by the Trustee. On September 22, 2011, the court entered an order approving the settlement as fair, reasonable and adequate. In October 2011, certain parties filed notices of appeal from the court’s order approving the settlement. The aforementioned settlements do not resolve other outstanding lawsuits against the Manager and its affiliates relating to BLMIS.

     On April 16, 2010, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark IV Funding Limited (“AAArdvark IV”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark IV. Plaintiffs allege breach of contract against the defendants and seek compensatory damages, costs and disbursements, including attorney fees. On July 15, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark Funding Limited (“AAArdvark I”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark I. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees. On November 9, 2011, a lawsuit was filed in New York state court against the Manager, an affiliate of the Manager and AAArdvark XS Funding Limited (“AAArdvark XS”), an entity advised by the Manager’s affiliate, in connection with investments made by the plaintiffs in AAArdvark XS. The complaint alleges breach of contract against the defendants and seeks compensatory damages, costs and disbursements, including attorney fees.

     The Manager believes the lawsuits and appeals described above are without legal merit and, with the exception of actions it has settled, is defending against them vigorously. The Defendant Funds’ Boards of Trustees have also engaged counsel to represent the Funds and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Defendant Funds may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer mutual funds.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer Variable Account Funds:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Value Fund/VA (a separate series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 30, 2011, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financial highlights of Oppenheimer Value Fund/VA for the years ended prior to January 1, 2009 were audited by other auditors whose report dated February 11, 2009 expressed an unqualified opinion on those financial highlights.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 30, 2011, by correspondence with the custodian and transfer agent. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Value Fund/VA as of December 30, 2011, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two-year period then ended and the financial highlights for each of the years in the three-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp
Denver, Colorado
February 16, 2012

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FEDERAL INCOME TAX INFORMATION Unaudited

In early 2012, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2011. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.

     Dividends, if any, paid by the Fund during the fiscal year ended December 30, 2011 which are not designated as capital gain distributions should be multiplied by the maximum amount allowable but not less than 100% to arrive at the amount eligible for the corporate dividend-received deduction.

     The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

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BOARD APPROVAL OF THE FUND’S INVESTMENT ADVISORY AGREEMENT Unaudited

Each year, the Board of Trustees (the “Board”), including a majority of the independent Trustees, is required to determine whether to renew the Fund’s investment advisory agreement (the “Agreement”). The Investment Company Act of 1940, as amended, requires that the Board request and evaluate, and that the Manager provide, such information as may be reasonably necessary to evaluate the terms of the Agreement. The Board employs an independent consultant to prepare a report that provides information, including comparative information that the Board requests for that purpose. In addition, the Board receives information throughout the year regarding Fund services, fees, expenses and performance.

     The Manager and the independent consultant provided information to the Board on the following factors: (i) the nature, quality and extent of the Manager’s services, (ii) the investment performance of the Fund and the Manager, (iii) the fees and expenses of the Fund, including comparative expense information, (iv) the profitability of the Manager and its affiliates, including an analysis of the cost of providing services, (v) whether economies of scale are realized as the Fund grows and whether fee levels reflect these economies of scale for Fund investors and (vi) other benefits to the Manager from its relationship with the Fund. The Board was aware that there are alternatives to retaining the Manager.

     Outlined below is a summary of the principal information considered by the Board as well as the Board’s conclusions.

     Nature, Quality and Extent of Services. The Board considered information about the nature, quality and extent of the services provided to the Fund and information regarding the Manager’s key personnel who provide such services. The Manager’s duties include providing the Fund with the services of the portfolio manager and the Manager’s investment team, who provide research, analysis and other advisory services in regard to the Fund’s investments; securities trading services; oversight of third-party service providers; monitoring compliance with applicable Fund policies and procedures and adherence to the Fund’s investment restrictions. The Manager is responsible for providing certain administrative services to the Fund as well. Those services include providing and supervising all administrative and clerical personnel who are necessary in order to provide effective corporate administration for the Fund; compiling and maintaining records with respect to the Fund’s operations; preparing and filing reports required by the Securities and Exchange Commission; preparing periodic reports regarding the operations of the Fund for its shareholders; preparing proxy materials for shareholder meetings; and preparing the registration statements required by Federal and state securities laws for the sale of the Fund’s shares. The Manager also provides the Fund with office space, facilities and equipment.

     The Board also considered the quality of the services provided and the quality of the Manager’s resources that are available to the Fund. The Board took account of the fact that the Manager has had over fifty years of experience as an investment adviser and that its assets under management rank it among the top mutual fund managers in the United States. The Board evaluated the Manager’s advisory, administrative, accounting, legal and compliance services, and information the Board has received regarding the experience and professional qualifications of the Manager’s key personnel and the size and functions of its staff. In its evaluation of the quality of the portfolio management services provided, the Board considered the experience of Mitch Williams, the portfolio manager for the Fund, and the Manager’s investment team and analysts. The Board members also considered the totality of their experiences with the Manager as directors or trustees of the Fund and other funds advised by the Manager. The Board considered information regarding the quality of services provided by affiliates of the Manager, which its members have become knowledgeable about in connection with the renewal of the Fund’s service agreements. The Board concluded, in light of the Manager’s experience, reputation, personnel, operations and resources that the Fund benefits from the services provided under the Agreement.

     Investment Performance of the Manager and the Fund. Throughout the year, the Manager provided information on the investment performance of the Fund and the Manager, including comparative performance information. The Board also reviewed information, prepared by the Manager and by the independent consultant, comparing the Fund’s

28 | OPPENHEIMER VALUE FUND/VA

historical performance to relevant market indices and to the performance of other large-cap value funds underlying variable insurance products. The Board considered that the Fund outperformed its performance universe during the one-, three-, and five-year Lipper periods.

     Costs of Services by the Manager. The Board reviewed the fees paid to the Manager and the other expenses borne by the Fund. The Board also considered the comparability of the fees charged and the services provided to the Fund to the fees and services for other clients or accounts advised by the Manager. The independent consultant provided comparative data in regard to the fees and expenses of the Fund and other large-cap value funds underlying variable insurance products. In reviewing the fees and expenses charged to the VA funds, the Board considered the Manager’s assertion that, because there is much greater disparity in the fees and services that may be provided by a manager to a VA fund as opposed to a retail fund, when comparing the expenses of the various VA funds to those of retail funds, it is most appropriate to focus on total expenses (rather than on the management fees). Accordingly, while the Board reviewed and considered all expenses, it focused on total expenses. The Board considered that the Fund’s actual management fees and total expenses were lower than its expense group median. The Manager has voluntarily agreed to limit the Fund’s total annual operating expenses so that those expenses, as percentages of daily net assets, will not exceed the annual rate of 0.80% for Non-Service Shares and 1.05% for Service Shares. This voluntary expense limitation my not be amended or withdrawn until one year after the date of prospectus.

     Economies of Scale and Profits Realized by the Manager. The Board considered information regarding the Manager’s costs in serving as the Fund’s investment adviser, including the costs associated with the personnel and systems necessary to manage the Fund, and information regarding the Manager’s profitability from its relationship with the Fund. The Board reviewed whether the Manager may realize economies of scale in managing and supporting the Fund. The Board noted that the Fund currently has management fee breakpoints, which are intended to share with Fund shareholders economies of scale that may exist as the Fund’s assets grow.

     Other Benefits to the Manager. In addition to considering the profits realized by the Manager, the Board considered information that was provided regarding the direct and indirect benefits the Manager receives as a result of its relationship with the Fund, including compensation paid to the Manager’s affiliates and research provided to the Manager in connection with permissible brokerage arrangements (soft dollar arrangements). The Board also considered that the Manager must be able to pay and retain experienced professional personnel at competitive rates to provide quality services to the Fund.

     Conclusions. These factors were also considered by the independent Trustees meeting separately from the full Board, assisted by experienced counsel to the Fund and to the independent Trustees. Fund counsel and the independent Trustees’ counsel are independent of the Manager within the meaning and intent of the Securities and Exchange Commission Rules.

     Based on its review of the information it received and its evaluations described above, the Board, including a majority of the independent Trustees, decided to continue the Agreement through August 31, 2012. In arriving at this decision, the Board did not single out any factor or factors as being more important than others, but considered all of the above information, and considered the terms and conditions of the Agreement, including the management fee, in light of all of the surrounding circumstances.

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PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited

The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which the Fund votes proxies relating to securities (“portfolio proxies”) held by the Fund. A description of the Fund’s Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund’s website at oppenheimerfunds.com, and (iii) on the SEC’s website at www.sec.gov. In addition, the Fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund’s voting record is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC’s website at www.sec.gov.

     The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund’s Form N-Q filings are available on the SEC’s website at www.sec.gov. Those forms may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

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TRUSTEES AND OFFICERS Unaudited

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
INDEPENDENT TRUSTEES	The address of each Trustee in the chart below is 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or until his or her resignation, retirement, death or removal.
William L. Armstrong, Chairman of the Board of Trustees and Trustee (since 2002) Age: 74	President, Colorado Christian University (since 2006); Chairman, Cherry Creek Mortgage Company (since 1991), Chairman, Centennial State Mortgage Company (since 1994), Chairman, The El Paso Mortgage Company (since 1993); Chairman, Ambassador Media Corporation (since 1984); Chairman, Broadway Ventures (since 1984); Director of Helmerich & Payne, Inc. (oil and gas drilling/production company) (since 1992), former Director of Campus Crusade for Christ (non-profit) (1991-2008); former Director, The Lynde and Harry Bradley Foundation, Inc. (non-profit organization) (2002-2006); former Chairman of: Transland Financial Services, Inc. (private mortgage banking company) (1997-2003), Great Frontier Insurance (1995-2000), Frontier Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier Title (title insurance agency) (1995-2000); former Director of the following: UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation (computer equipment company) (1991-2003) and International Family Entertainment (television channel) (1992-1997); U.S. Senator (January 1979-January 1991). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Armstrong has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Edward L. Cameron, Trustee (since 2002) Age: 73	Member of The Life Guard of Mount Vernon (George Washington historical site) (June 2000-June 2006); Partner of PricewaterhouseCoopers LLP (accounting firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management Industry Services Group (accounting firm) (July 1994-June 1998). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Cameron has served on the Boards of certain Oppenheimer funds since 1999, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Jon S. Fossel, Trustee (since 2002) Age: 69	Chairman of the Board (since 2006) and Director (since June 2002) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (since November 2004); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Manager; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Manager), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Sam Freedman, Trustee (since 2002) Age: 71	Director of Colorado UpLIFT (charitable organization) (since September 1984). Mr. Freedman held several positions with the Manager and with subsidiary or affiliated companies of the Manager (until October 1994). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Freedman has served on the Boards of certain Oppenheimer funds since 1996, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Beverly L. Hamilton, Trustee (since 2002) Age: 65	Trustee of Monterey Institute for International Studies (educational organization) (since February 2000); Board Member of Middlebury College (educational organization) (since December 2005); Chairman (since 2010) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; Director (October 1991-2005); Vice Chairman (2006-2009) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual

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TRUSTEES AND OFFICERS Unaudited / Continued

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
Beverly L. Hamilton, Continued	Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Oversees 36 portfolios in the OppenheimerFunds complex. Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
Robert J. Malone, Trustee (since 2002) Age: 67	Board of Directors of Opera Colorado Foundation (non-profit organization) (since March 2008); Director of Jones Knowledge, Inc. (since 2006); Director of Jones International University (educational organization) (since August 2005); Chairman, Chief Executive Officer and Director of Steele Street Bank & Trust (commercial banking) (since August 2003); Director of Colorado UpLIFT (charitable organization) (since 1986); Trustee of the Gallagher Family Foundation (non-profit organization) (since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004). Oversees 36 portfolios in the OppenheimerFunds complex. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
F. William Marshall, Jr., Trustee (since 2002) Age: 69	Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (since 1996) and MML Series Investment Fund (investment company) (since 1996); President and Treasurer of the SIS Funds (private charitable fund) (January 1999-March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Oversees 38 portfolios in the OppenheimerFunds complex. Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds’) financial, accounting, regulatory and investment matters and has contributed to the Boards’ deliberations.
INTERESTED TRUSTEE AND OFFICER	The address of Mr. Glavin is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008. Mr. Glavin serves as a Trustee for an indefinite term, or until his resignation, retirement, death or removal and as an Officer for an indefinite term, or until his resignation, retirement, death or removal. Mr. Glavin is an Interested Trustee due to his positions with OppenheimerFunds, Inc. and its affiliates.
William F. Glavin, Jr., Trustee, President and Principal Executive Officer (since 2009) Age: 53	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. (“OAC”) (the Manager’s parent holding company) (since June 2009); Executive Vice President (March 2006-February 2009) and Chief Operating Officer (July 2007-February 2009) of Massachusetts Mutual Life Insurance Company (OAC’s parent company); Director (May 2004-March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004-January 2005), President (January 2005-March 2006) and Chief Executive Officer (June 2005-March 2006) of Babson Capital Management LLC; Director (March 2005-March 2006), President (May 2003-March 2006) and Chief Compliance Officer (July 2005-March 2006) of Babson Capital Securities, Inc. (a broker-dealer); President (May 2003-March 2006) of Babson Investment Company, Inc.; Director (May 2004-August 2006) of Babson Capital Europe Limited; Director (May 2004-October 2006) of Babson Capital Guernsey Limited; Director (May 2004-March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005-March 2007) of Baring Asset Management Limited; Director (February 2005-June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003-November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006-September 2006) of C.M. Benefit Insurance Company; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of C.M. Life Insurance Company; President (March 2006-May 2007) of MassMutual Assignment Company; Director (January 2005-December 2006), Deputy Chairman (March 2005- December 2006) and President (February 2005-March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008-June 2009) and Executive Vice President (June 2007-July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007-January 2009) of MML Distributors, LLC; and Chairman (March 2006-December 2008) and Chief Executive Officer (May 2007-December 2008) of MML Investors Services, Inc. Oversees 63 portfolios as a Trustee/Director and 96 portfolios as an officer in the OppenheimerFunds complex.

32 | OPPENHEIMER VALUE FUND/VA

Name, Position(s) Held with the Fund, Length of Service, Age	Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held; Number of Portfolios in the Fund Complex Currently Overseen
OTHER OFFICERS OF THE FUND	The addresses of the Officers in the chart below are as follows: for Messrs. Williams, Gabinet and Ms. Nasta, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs. Vandehey and Wixted, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Officer serves for an indefinite term or until his or her resignation, retirement, death or removal.
Mitch Williams, Vice President (since 2008) Age: 43	Vice President of the Manager (since July 2006) and a Senior Research Analyst of the Manager (since April 2002); a Chartered Financial Analyst. Prior to joining the manager, Vice President and Research Analyst for Evergreen Funds (October 2000-January 2002). A portfolio manager and officer of 6 portfolios in the OppenheimerFunds complex.
Arthur S. Gabinet, Secretary (since 2011) Age: 53	Executive Vice President (since May 2010) and General Counsel (since January 2011) of the Manager; General Counsel of the Distributor (since January 2011); General Counsel of Centennial Asset Management Corporation (since January 2011); Executive Vice President and General Counsel of HarbourView Asset Management Corporation (since January 2011); Assistant Secretary (since January 2011) and Director (since January 2011) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since January 2011); Director of Oppenheimer Real Asset Management, Inc. (since January 2011); Executive Vice President and General Counsel of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since January 2011); Executive Vice President and General Counsel of OFI Private Investments, Inc. (since January 2011); Vice President of OppenheimerFunds Legacy Program (since January 2011); Executive Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since January 2011); General Counsel, Asset Management of the Manager (May 2010-December 2010); Principal, The Vanguard Group (November 2005-April 2010); District Administrator, U.S. Securities and Exchange Commission (January 2003- October 2005). An officer of 96 portfolios in the OppenheimerFunds complex.
Christina M. Nasta, Vice President and Chief Business Officer (since 2011) Age: 38	Senior Vice President of the Manager (since July 2010); Vice President of the Manager (since January 2003); Vice President of OppenheimerFunds Distributor, Inc. (since January 2003). An officer of 96 portfolios in the OppenheimerFunds complex.
Mark S. Vandehey, Vice President and Chief Compliance Officer (since 2004) Age: 61	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983). An officer of 96 portfolios in the OppenheimerFunds complex.
Brian W. Wixted, Treasurer and Principal Financial & Accounting Officer (since 2002) Age: 52	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999- June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of OAC (March 1999-June 2008). An officer of 96 portfolios in the OppenheimerFunds complex.

The Fund’s Statement of Additional Information contains additional information about the Fund’s Trustees and Officers and is available without charge, upon request, by calling 1.800.988.8287.

33 | OPPENHEIMER VALUE FUND/VA

OPPENHEIMER VALUE FUND/ VA

A Series of Oppenheimer Variable Account Funds

Manager	OppenheimerFunds, Inc.
Distributor	OppenheimerFunds Distributor, Inc.
Transfer Agent	OppenheimerFunds Services
Independent Registered Public Accounting Firm	KPMG llp
Counsel	K&L Gates llp
	Before investing in the Fund, investors should carefully consider its investment objectives, risks, charges and expenses. The Fund’s prospectus and summary prospectus contain this and other information about the Fund, and may be
	obtained by asking your financial advisor or calling us at 1.800.988.8287. Read prospectuses and summary prospectuses carefully before investing.

©2012 OppenheimerFunds, Inc. All rights reserved.

Item 2. Code of Ethics.

The registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions.

Item 3. Audit Committee Financial Expert.

The Board of Trustees of the registrant has determined that F. William Marshall, Jr., the Chairman of the Board’s Audit Committee, is the audit committee financial expert and that Mr. Marshall is “independent” for purposes of this Item 3.

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees

The principal accountant for the audit of the registrant’s annual financial statements billed $327,200 in fiscal 2011 and 2010.

(b) Audit-Related Fees

The principal accountant for the audit of the registrant’s annual financial statements billed no such fees during the last two fiscal years.

The principal accountant for the audit of the registrant’s annual financial statements billed $414,870 in fiscal 2011 and $342,900 in fiscal 2010 to the registrant’s investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant.

Such services include: internal control reviews, surprise exams, attestation and compliance procedures.

(c) Tax Fees

The principal accountant for the audit of the registrant’s annual financial statements billed $6,190 in fiscal 2011 and $50,311 in fiscal 2010.

The principal accountant for the audit of the registrant’s annual financial statements billed no such fees to the registrant during the last two fiscal years to the registrant’s investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant.

Such services include: tax compliance, tax planning and tax advice. Tax compliance generally involves preparation of original and amended tax returns, claims for a refund and tax payment-

planning services. Tax planning and tax advice includes assistance with tax audits and appeals, tax advice related to mergers and acquisitions and requests for rulings or technical advice from taxing authorities.

(d) All Other Fees

The principal accountant for the audit of the registrant’s annual financial statements billed no such fees during the last two fiscal years.

The principal accountant for the audit of the registrant’s annual financial statements billed no such fees during the last two fiscal years to the registrant’s investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant.

(e) (1) During its regularly scheduled periodic meetings, the registrant’s audit committee will pre-approve all audit, audit-related, tax and other services to be provided by the principal accountants of the registrant.

The audit committee has delegated pre-approval authority to its Chairman for any subsequent new engagements that arise between regularly scheduled meeting dates provided that any fees such pre-approved are presented to the audit committee at its next regularly scheduled meeting.

Under applicable laws, pre-approval of non-audit services maybe waived provided that: 1) the aggregate amount of all such services provided constitutes no more than five percent of the total amount of fees paid by the registrant to it principal accountant during the fiscal year in which services are provided 2) such services were not recognized by the registrant at the time of engagement as non-audit services and 3) such services are promptly brought to the attention of the audit committee of the registrant and approved prior to the completion of the audit.

(2) 100%

(f) Not applicable as less than 50%.

(g) The principal accountant for the audit of the registrant’s annual financial statements billed $421,060 in fiscal 2011 and $393,211 in fiscal 2010 to the registrant and the registrant’s investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant related to non-audit fees. Those billings did not include any prohibited non-audit services as defined by the Securities Exchange Act of 1934.

The registrant’s audit committee of the board of trustees has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides

ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence. No such services were rendered.

Item 5. Audit Committee of Listed Registrants

Not applicable.

Item 6. Schedule of Investments.

a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.

b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

The Fund’s Governance Committee Provisions with Respect to Nominations of Directors/Trustees to the Respective Boards

1. The Fund’s Governance Committee (the “Committee”) will evaluate potential Board candidates to assess their qualifications. The Committee shall have the authority, upon approval of the Board, to retain an executive search firm to assist in this effort. The Committee may consider recommendations by business and personal contacts of current Board members and by executive search firms which the Committee may engage from time to time and may also consider shareholder recommendations. The Committee may consider the advice and recommendation of the Funds’ investment manager and its affiliates in making the selection.

2. The Committee shall screen candidates for Board membership. The Committee has not established specific qualifications that it believes must be met by a trustee nominee. In evaluating trustee nominees, the Committee considers, among other things, an individual’s background, skills, and experience; whether the individual is an “interested person” as defined in the Investment Company Act of 1940; and whether the individual would be deemed an “audit committee financial expert” within the meaning of applicable SEC rules. The Committee also considers whether the individual’s background, skills, and experience will complement the background, skills, and experience of other nominees and will contribute to the Board. There are no differences in the manner in which the Committee evaluates nominees for trustees based on whether the nominee is recommended by a shareholder.

3. The Committee may consider nominations from shareholders for the Board at such times as the Committee meets to consider new nominees for the Board. The Committee shall have the sole discretion to determine the candidates to present to the Board and, in such cases where required, to shareholders. Recommendations for trustee nominees should, at a minimum, be accompanied by the following:

• the name, address, and business, educational, and/or other pertinent background of the person being recommended;

• a statement concerning whether the person is an “interested person” as defined in the Investment Company Act of 1940;

• any other information that the Funds would be required to include in a proxy statement concerning the person if he or she was nominated; and

• the name and address of the person submitting the recommendation and, if that person is a shareholder, the period for which that person held Fund shares.

The recommendation also can include any additional information which the person submitting it believes would assist the Committee in evaluating the recommendation.

4. Shareholders should note that a person who owns securities issued by Massachusetts Mutual Life Insurance Company (the parent company of the Funds’ investment adviser) would be deemed an “interested person” under the Investment Company Act of 1940. In addition, certain other relationships with Massachusetts Mutual Life Insurance Company or its subsidiaries, with registered broker-dealers, or with the Funds’ outside legal counsel may cause a person to be deemed an “interested person.”

5. Before the Committee decides to nominate an individual as a trustee, Committee members and other directors customarily interview the individual in person. In addition, the individual customarily is asked to complete a detailed questionnaire which is designed to elicit

information which must be disclosed under SEC and stock exchange rules and to determine whether the individual is subject to any statutory disqualification from serving as a trustee of a registered investment company.

Item 11. Controls and Procedures.

Based on their evaluation of the registrant’s disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR 270.30a-3(c)) as of 12/30/2011, the registrant’s principal executive officer and principal financial officer found the registrant’s disclosure controls and procedures to provide reasonable assurances that information required to be disclosed by the registrant in the reports that it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated to registrant’s management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure, and (b) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the U.S. Securities and Exchange Commission.

There have been no changes in the registrant’s internal controls over financial reporting that occurred during the registrant’s second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Exhibits.

(a)	(1) Exhibit attached hereto.
	(2) Exhibits attached hereto.
	(3) Not applicable.

(b) Exhibit attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Oppenheimer Variable Account Funds

By:	/s/ William F. Glavin, Jr.
	William F. Glavin, Jr.
	Principal Executive Officer
Date:	2/9/2012

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ William F. Glavin, Jr.
	William F. Glavin, Jr.
	Principal Executive Officer
Date:	2/9/2012
By:	/s/ Brian W. Wixted
	Brian W. Wixted
	Principal Financial Officer
Date:	2/9/2012

EX-99.CODE ETH

CODE OF ETHICS
FOR PRINCIPAL EXECUTIVE AND FINANCIAL OFFICERS
OF THE OPPENHEIMER FUNDS
AND OPPENHEIMERFUNDS, INC.

     This Code of Ethics for Principal Executive and Financial Officers (referred to in this document as the “Code”) has been adopted by each of the investment companies for which OppenheimerFunds, Inc. or one of its subsidiaries or affiliates (referred to collectively in this document as “OFI”) acts as investment adviser (individually, a “Fund” and collectively, the “Funds”), and by OFI to effectuate compliance with Section 406 under the Sarbanes-Oxley Act of 2002 and the rules adopted to implement Section 406.

     This Code applies to OFI’s and each Fund’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (“Covered Officers”). A listing of positions currently within the ambit of Covered Officers is attached as Exhibit A.¹

1. Purpose of the Code

     This Code sets forth standards and procedures that are reasonably designed to deter wrongdoing and promote:

• honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

• full, fair, accurate, timely, and understandable disclosure in reports and documents that a Fund files with, or submits to, the U.S. Securities and Exchange Commission (“SEC”) and in other public communications made by the Fund;

• compliance with applicable governmental laws, rules and regulations;

• the prompt internal reporting of violations of this Code to the Code Administrator identified below; and

• accountability for adherence to this Code.

     In general, the principles that govern honest and ethical conduct, including the avoidance of conflicts of interest between personal and professional relationships, reflect, at the minimum, the following: (1) the duty at all times in performing any responsibilities as a Fund financial officer, controller, accountant or principal executive officer to place the interests of the Funds ahead of personal interests; (2) the fundamental standard that Covered Officers should not take inappropriate advantage of their positions; (3) the duty to assure that a Fund’s financial statements and reports to

¹ The obligations imposed by this Code on Covered Officers are separate from and in addition to any obligations that may be imposed on such persons as Covered Persons under the Code of Ethics adopted by OFI and the Funds under Rule 17j-1 of the Investment Company Act of 1940, as amended and any other code of conduct applicable to Covered Officers in whatever capacity they serve. This Code does not incorporate by reference any provisions of the Rule 17j-1 Code of Ethics and accordingly, any violations or waivers granted under the Rule 17j-1 Code of Ethics will not be considered a violation or waiver under this Code.

its shareholders are prepared honestly and accurately in accordance with applicable rules, regulations and accounting standards; and (4) the duty to conduct the Funds’ business and affairs in an honest and ethical manner. Each Covered Officer should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.

     It is acknowledged that, as a result of the contractual relationship between each Fund and OFI, of which the Covered Officers are also officers or employees, and subject to OFI’s fiduciary duties to each Fund, the Covered Officers will, in the normal course of their duties, be involved in establishing policies and implementing decisions that will have different effects on OFI and the Funds. It is further acknowledged that the participation of the Covered Officers in such activities is inherent in the contractual relationship between each Fund and OFI and is consistent with the expectations of the Board of Trustees/Directors of the performance by the Covered Officers of their duties as officers of the Funds.

2. Prohibitions

     The specific provisions and reporting requirements of this Code are concerned primarily with promoting honest and ethical conduct and avoiding conflicts of interest in personal and professional relationships. No Covered Officer may use information concerning the business and affairs of a Fund, including the investment intentions of a Fund, or use his or her ability to influence such investment intentions, for personal gain to himself or herself, his or her family or friends or any other person or in a manner detrimental to the interests of a Fund or its shareholders.

     No Covered Officer may use his or her personal influence or personal relationships to influence the preparation and issuance of financial reports of a Fund whereby the Covered Officer would benefit personally to the detriment of the Fund and its shareholders.

     No Covered Officer shall intentionally for any reason take any action or fail to take any action in connection with his or her official acts on behalf of a Fund that causes the Fund to violate applicable laws, rules and regulations.

     No Covered Officer shall, in connection with carrying out his or her official duties and responsibilities on behalf of a Fund:

(i)	employ any device, scheme or artifice to defraud a Fund or its shareholders;
(ii)	intentionally cause a Fund to make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading in its official documents, regulatory filings, financial statements or communications to the public;
(iii)	engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any Fund or its shareholders;
(iv)	engage in any manipulative practice with respect to any Fund;
(v)	use his or her personal influence or personal relationships to influence any

	business decision, investment decisions, or financial reporting by a Fund whereby the Covered Officer would benefit personally to the detriment of the Fund or its shareholders;
(vi)	intentionally cause a Fund to fail to comply with applicable laws, rules and regulations, including failure to comply with the requirement of full, fair, accurate, understandable and timely disclosure in reports and documents that a Fund files with, or submits to, the SEC and in other public communications made by the Fund;
(vii)	intentionally mislead or omit to provide material information to the Fund’s independent auditors or to the Board of Trustees/Directors or the officers of the Fund or its investment adviser in connection with financial reporting matters;
(viii)	fail to notify the Code Administrator or the Chief Executive Officer of the Fund or its investment adviser promptly if he or she becomes aware of any existing or potential violations of this Code or applicable laws;
(ix)	retaliate against others for, or otherwise discourage the reporting of, actual or apparent violations of this Code; or
(x)	fails to acknowledge or certify compliance with this Code if requested to do so.

3. Reports of Conflicts of Interests

     If a Covered Officer becomes aware of a conflict of interest under this Code or, to the Covered Officer’s reasonable belief, the appearance of one, he or she must immediately report the matter to the Code’s Administrator. If the Code Administrator is involved or believed to be involved in the conflict of interest or appearance of conflict of interest, the Covered Officer shall report the matter directly to the OFI’s Chief Executive Officer.

     Upon receipt of a report of a conflict, the Code Administrator will take prompt steps to determine whether a conflict of interest exists. If the Code Administrator determines that an actual conflict of interest exists, the Code Administrator will take steps to resolve the conflict. If the Code Administrator determines that the appearance of a conflict exists, the Code Administrator will take appropriate steps to remedy such appearance. If the Code Administrator determines that no conflict or appearance of a conflict exists, the Code Administrator shall meet with the Covered Officer to advise him or her of such finding and of his or her reason for taking no action. In lieu of determining whether a conflict or appearance of conflict exists, the Code Administrator may in his or her discretion refer the matter to the Fund’s Board of Trustees/Directors.

4. Waivers

     Any Covered Officer requesting a waiver of any of the provisions of this Code must submit a written request for such waiver to the Code Administrator, setting forth the basis of such request and all necessary facts upon which such request can be evaluated. The Code Administrator shall review such request and make a written determination thereon, which shall be binding. The Code Administrator may in reviewing such request, consult at his discretion with legal counsel to OFI or to the Fund.

     In determining whether to waive any of the provisions of this Code, the Code Administrator shall consider whether the proposed waiver:

(i)	is prohibited by this Code;
(ii)	is consistent with honest and ethical conduct; and
(iii)	will result in a conflict of interest between the Covered Officer’s personal and professional obligations to a Fund.

     In lieu of determining whether to grant a waiver, the Code Administrator in his or her discretion may refer the matter to the appropriate Fund’s Board of Trustees/Directors.

5. Reporting Requirements

     (a) Each Covered Officer shall, upon becoming subject to this Code, be provided with a copy of this Code and shall affirm in writing that he or she has received, read, understands and shall adhere to this Code.

     (b) At least annually, all Covered Officers shall be provided with a copy of this Code and shall certify that they have read and understand this Code and recognize that they are subject thereto.

     (c) At least annually, all Covered Officers shall certify that they have complied with the requirements of this Code and that they have disclosed or reported any violations of this Code to the Code Administrator or the Chief Executive Officer of the Fund or its investment adviser.

     (d) The Code Administrator shall submit a quarterly report to the Board of Trustees/Directors of each Fund containing (i) a description of any report of a conflict of interest or apparent conflict and the disposition thereof; (ii) a description of any request for a waiver from this Code and the disposition thereof; (iii) any violation of the Code that has been reported or found and the sanction imposed; (iv) interpretations issued under the Code by the Code Administrator; and (v) any other significant information arising under the Code including any proposed amendments.

     (e) Each Covered Officer shall notify the Code Administrator promptly if he or she knows of or has a reasonable belief that any violation of this Code has occurred or is likely to occur. Failure to do so is itself a violation of this Code.

     (f) Any changes to or waivers of this Code, including “implicit” waivers as defined in applicable SEC rules, will, to the extent required, be disclosed by the Code Administrator or his or her designee as provided by applicable SEC rules.²

6. Annual Review

     At least annually, the Board of Trustees/Directors of each Fund shall review the Code and consider whether any amendments are necessary or desirable.

7. Sanctions

     Any violation of this Code of Ethics shall be subject to the imposition of such sanctions by OFI as may be deemed appropriate under the circumstances to achieve the purposes of this Code and may include, without limitation, a letter of censure, suspension from employment or termination of employment, in the sole discretion of OFI.

8. Administration and Construction

     (a) The administration of this Code of Ethics shall be the responsibility of OFI’s General Counsel or his designee as the “Code Administrator” of this Code, acting under the terms of this Code and the oversight of the Trustees/Directors of the Funds.

     (b) The duties of such Code Administrator will include:

(i)	Continuous maintenance of a current list of the names of all Covered Officers;
(ii)	Furnishing all Covered Officers a copy of this Code and initially and periodically informing them of their duties and obligations thereunder;
(iii)	Maintaining or supervising the maintenance of all records required by this Code, including records of waivers granted hereunder;
(iv)	Issuing interpretations of this Code which appear to the Code Administrator to be consistent with the objectives of this Code and any applicable laws or regulations;
(v)	Conducting such inspections or investigations as shall reasonably be required to detect and report any violations of this Code, with his or her recommendations, to the Chief Executive Officer of OFI and to the Trustees/Directors of the affected Fund(s) or any committee appointed by them to deal with such information; and Periodically conducting educational training programs as needed to explain and reinforce the terms of this Code.

     (c) In carrying out the duties and responsibilities described under this Code, the Code Administrator may consult with legal counsel, who may include legal counsel to the applicable Funds, and such other persons as the Administrator shall deem necessary or desirable. The Code Administrator shall be protected from any liability

² An “implicit waiver” is the failure to take action within a reasonable period of time regarding a material departure from a provision of this Code that has been made known to the General Counsel, the Code Administrator, and an executive officer of the Fund or OFI.

hereunder or under any applicable law, rule or regulation, for decisions made in good faith based upon his or her reasonable judgment.

9. Required Records

     The Administrator shall maintain and cause to be maintained in an easily accessible place, the following records for the period required by applicable SEC rules (currently six years following the end of the fiscal year of OFI in which the applicable event or report occurred):

(a)	A copy of any Code which has been in effect during the period;
(b)	A record of any violation of any such Code and of any action taken as a result of such violation, during the period;
(c)	A copy of each annual report pursuant to the Code made by a Covered Officer during the period;
(d)	A copy of each report made by the Code Administrator pursuant to this Code during the period;
(e)	A list of all Covered Officers who are or have been required to make reports pursuant to this Code during the period, plus those person(s) who are or were responsible for reviewing these reports;
(f)	A record of any request to waive any requirement of this Code, the decision thereon and the reasons supporting the decision; and
(g)	A record of any report of any conflict of interest or appearance of a conflict of interest received by the Code Administrator or discovered by the Code Administrator during the period, the decision thereon and the reasons supporting the decision.

10. Amendments and Modifications

     Other than non-substantive or administrative changes, this Code may not be amended or modified unless approved or ratified by the Board of Trustees/Directors of each Fund.

11. Confidentiality.

     This Code is identified for the internal use of the Funds and OFI. Reports and records prepared or maintained under this Code are considered confidential and shall be maintained and protected accordingly to the extent permitted by applicable laws, rules and regulations. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Trustees/Directors of the affected Fund(s) and their counsel, the independent auditors of the affected Funds and/or OFI, and to OFI, except as such disclosure may be required pursuant to applicable judicial or regulatory process.

Dated as of: June 25, 2003, as revised August 30, 2006 and further revised as of March 5, 2010.

Exhibit A

Positions Covered by this Code of Ethics for Principal Executive and Financial Officers*

Each Oppenheimer fund

President (Principal Executive Officer)

Treasurer (Principal Financial Officer)

OFI

President and Chief Executive Officer (Principal Executive Officer)

Chief Financial Officer and Treasurer (Principal Financial Officer)

* There are no other positions with the Funds or OFI who perform similar functions to those listed above.

EX-99.CERT

Exhibit 99.CERT

Section 302 Certifications

CERTIFICATIONS

I, William F. Glavin, Jr., certify that:

1. I have reviewed this report on Form N-CSR of Oppenheimer Variable Account Funds;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of Trustees (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  2/9/2012

/s/ William F. Glavin, Jr.

William F. Glavin, Jr.
Principal Executive Officer

Exhibit 99.CERT

Section 302 Certifications

CERTIFICATIONS

I, Brian W. Wixted, certify that:

1. I have reviewed this report on Form N-CSR of Oppenheimer Variable Account Funds;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of Trustees (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  2/9/2012

/s/ Brian W. Wixted

Brian W. Wixted
Principal Financial Officer

EX-99.906CERT

EX-99.906CERT

Section 906 Certifications

CERTIFICATION PURSUANT TO 18 U.S.C SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

William F. Glavin, Jr., Principal Executive Officer, and Brian W. Wixted, Principal Financial Officer, of Oppenheimer Variable Account Funds (the “Registrant”), each certify to the best of his knowledge that:

1.	The Registrant’s periodic report on Form N-CSR for the period ended 12/30/2011 (the “Form N-CSR”) fully complies with the requirements of Section 15(d) of the Securities Exchange Act of 1934, as amended; and
2.	The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. This certification is being furnished to the Commission solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Form N-CSR filed with the Commission.

Principal Executive Officer	Principal Financial Officer
Oppenheimer Variable Account Funds	Oppenheimer Variable Account Funds
/s/ William F. Glavin, Jr.	/s/ Brian W. Wixted
William F. Glavin, Jr.	Brian W. Wixted
Date:  2/9/2012	Date:  2/9/2012