-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J/fqDJohlsnRUR6VbpsvAYScdEZP/isNMcENSywmmV+fjxsOyPmfsgGisjzUlEHQ hUXK/O+gZD0v7UOjcNCtTA== /in/edgar/work/20000907/0001086144-00-000080/0001086144-00-000080.txt : 20000922 0001086144-00-000080.hdr.sgml : 20000922 ACCESSION NUMBER: 0001086144-00-000080 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000907 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER VARIABLE ACCOUNT FUNDS CENTRAL INDEX KEY: 0000752737 STANDARD INDUSTRIAL CLASSIFICATION: [0000 ] IRS NUMBER: 840974272 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-04108 FILM NUMBER: 717813 BUSINESS ADDRESS: STREET 1: 3410 S GALENA ST CITY: DENVER STATE: CO ZIP: 80231 BUSINESS PHONE: 3036713200 MAIL ADDRESS: STREET 2: 3410 S GALENA ST CITY: DENVER STATE: CO ZIP: 80231 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER VARIABLE LIFE FUNDS DATE OF NAME CHANGE: 19860609 N-30D 1 0001.txt OPPENHEIMER MULTIPLE STRATEGIES FUND/VA SAR Semiannual Report June 30, 2000 Oppenheimer Multiple Strategies Fund/VA A Series of Oppenheimer Variable Account Funds [logo]OppenheimerFunds(R) The Right Way to Invest Oppenheimer Variable Account Funds--Oppenheimer Multiple Strategies Fund/VA ================================================================================ Objective Oppenheimer Multiple Strategies Fund/VA, a series of Oppenheimer Variable Account Funds, seeks a high total investment return, which includes current income and capital appreciation in the value of its shares. The Fund attempts to achieve its investment objective from investments in common stocks and other equity securities, bonds and other debt securities and money market securities. ================================================================================ Narrative by Richard Rubinstein, Co-Portfolio Manager Over the six-month period that ended June 30, 2000, we were pleased with the Fund's performance, attaining a cumulative total return of 6.70%.(1) This was in large part due to our multiple-strategy investment approach, which encourages use of a number of investment styles, including growth-oriented technology stocks, which up through March 31, 2000, led the market higher before recent volatity gave back a portion of many gains. We also bought value-oriented stocks, which appear to have improved in the last six months. In short, our multiple-strategy investment approach gave us the exposure to growth and value stocks that we needed to participate in the strength of both market sectors during the reporting period. During this time, although the exact percentages vary daily as individual holdings gain and lose value, we generally maintained an allocation of approximately 55% stocks, 40% bonds and 5% cash. This allocation was designed to help the Fund participate in a rising stock market while controlling day-to-day volatility. Notable among the strongest contributors to the Fund's performance were stocks from a number of technology companies. Among the Fund's top holdings, we enjoyed good performance from Intel Corp., a leading semiconductor company. While technology stocks were buffeted by market volatility after the close of the Fund's fiscal period, the Fund's volatility was lower than might be expected in mid-April because of the Fund's diversification policy. Also, during this period, we began to see signs that the value sector of the stock market may soon turn around. For instance, value-oriented stocks rallied during March 2000, because of two related factors: low valuations and corporate actions. Value stocks--defined as stocks selling at low prices that do not reflect the underlying companies' true worth--had been out of favor for some time. As a result, the differences in valuations between growth and value companies had increased to historically wide levels. With their stocks at such low prices, the management of some value companies announced their intention to buy back shares or take their companies private, which helped rekindle investor interest in their stocks. Other value-oriented businesses have also been targets for acquisition, which also attracted investor interest. While there are risks in value investing that other investors will not recognize the true value of a particular stock so that its price does not rise, in the last six months business buyers appeared to take advantage of low valuations to acquire companies that are growing and are generating excess cash flow. These influences have benefited many of the fund's holdings, including companies in the financial services, retail and health care sectors. In terms of the Fund's fixed income investments, the past six months have been difficult for many sectors of the bond market. That's because interest rates rose throughout the period, eroding the prices of many bonds. However, because of supply-and-demand factors, prices of long-term U.S. Treasury bonds have risen, while prices of intermediate- and short-term bonds fell. We participated in the rally of long-term Treasuries through our holdings of zero-coupon bonds. The Fund also benefited from our holdings of U.S. dollar-denominated bonds from issuers in Latin America, which appreciated as regional economic conditions improved. Because of ongoing market volatility, the Fund's returns may fluctuate and may be less than the results shown. 1. Includes changes in net asset value per share and does not include the charges associated with the separate account products which offer this Fund. Such performance is not annualized and would have been lower if such charges were taken into account. 2 Oppenheimer Multiple Strategies Fund/VA Oppenheimer Variable Account Funds--Oppenheimer Multiple Strategies Fund/VA ================================================================================ As far as our future outlook is concerned, we remain positive. Value stocks performance seems to have improved in the last six months, which is encouraging. On the fixed income side, we believe that the bulk of interest-rate increases may be behind us. If and when evidence emerges that the economy has begun to slow, we expect the Federal Reserve Board to end its moves toward a more restrictive monetary policy, and we believe that bond prices should accordingly rally. Regardless of upcoming market conditions, however, we believe that the Fund's multiple-strategy approach makes it an appropriate investment even if particular asset classes, market sectors or investment styles are in favor at any specific time. In fact, it's what makes Oppenheimer Multiple Strategies Fund/VA an important part of The Right Way to Invest. Oppenheimer Multiple Strategies Fund/VA 3 Statement of Investments June 30, 2000 (Unaudited)
Market Value Shares Note 1 ================================================================================================================================ Common Stocks--51.7% - -------------------------------------------------------------------------------------------------------------------------------- Basic Materials--2.0% - -------------------------------------------------------------------------------------------------------------------------------- Chemicals--1.2% Bayer AG, Sponsored ADR 30,600 $ 1,196,778 - -------------------------------------------------------------------------------------------------------------------------------- Engelhard Corp. 128,000 2,184,000 - -------------------------------------------------------------------------------------------------------------------------------- Goodrich (B.F.) Co.(1) 80,000 2,725,000 - -------------------------------------------------------------------------------------------------------------------------------- Hercules, Inc. 70,000 984,375 ----------- 7,090,153 - -------------------------------------------------------------------------------------------------------------------------------- Metals--0.4% Alcoa, Inc. 31,500 913,500 - -------------------------------------------------------------------------------------------------------------------------------- De Beers Consolidated Mines Ltd., ADR 61,100 1,485,494 ----------- 2,398,994 - -------------------------------------------------------------------------------------------------------------------------------- Paper--0.4% Sonoco Products Co. 63,000 1,295,437 - -------------------------------------------------------------------------------------------------------------------------------- Weyerhaeuser Co. 26,000 1,118,000 ----------- 2,413,437 - -------------------------------------------------------------------------------------------------------------------------------- Capital Goods--3.1% - -------------------------------------------------------------------------------------------------------------------------------- Industrial Services--0.7% National Data Corp. 69,800 1,605,400 - -------------------------------------------------------------------------------------------------------------------------------- Pittston Co. 119,000 1,628,812 - -------------------------------------------------------------------------------------------------------------------------------- Service Corp. International 235,000 749,062 ----------- 3,983,274 - -------------------------------------------------------------------------------------------------------------------------------- Manufacturing--2.4% Cognex Corp.(2) 40,000 2,070,000 - -------------------------------------------------------------------------------------------------------------------------------- Coherent, Inc.(1)(2) 52,000 4,361,500 - -------------------------------------------------------------------------------------------------------------------------------- Honeywell International, Inc. 41,000 1,381,187 - -------------------------------------------------------------------------------------------------------------------------------- Identix, Inc.(2) 17,200 269,825 - -------------------------------------------------------------------------------------------------------------------------------- Pall Corp. 120,000 2,220,000 - -------------------------------------------------------------------------------------------------------------------------------- Swift Transportation Co., Inc.(2) 53,000 742,000 - -------------------------------------------------------------------------------------------------------------------------------- Trinity Industries, Inc. 40,000 740,000 - -------------------------------------------------------------------------------------------------------------------------------- Tyco International Ltd. 37,500 1,776,562 ----------- 13,561,074 - -------------------------------------------------------------------------------------------------------------------------------- Communication Services--1.9% - -------------------------------------------------------------------------------------------------------------------------------- Telecommunications: Long Distance--1.1% Brocade Communications Systems, Inc.(1)(2) 2,550 467,885 - -------------------------------------------------------------------------------------------------------------------------------- ECI Telecommunications Ltd. 33,900 1,211,925 - -------------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc.(2) 393 11,692 - -------------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc.(2)(3) 201 5,681 - -------------------------------------------------------------------------------------------------------------------------------- WorldCom, Inc.(2) 100,000 4,587,500 ----------- 6,284,683 4 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Telephone Utilities--0.7% SBC Communications, Inc. 71,000 $ 3,070,750 - -------------------------------------------------------------------------------------------------------------------------------- Tele Norte Leste Participacoes SA (Telemar) 26,283,402 502,503 - -------------------------------------------------------------------------------------------------------------------------------- Tele Norte Leste Participacoes SA (Telemar), Preference 3,077,499 72,161 - -------------------------------------------------------------------------------------------------------------------------------- Telesp Tele de Sao Paulo 19,200,000 205,942 ----------- 3,851,356 - -------------------------------------------------------------------------------------------------------------------------------- Telecommunications: Wireless--0.1% Telesp Celular Participacoes SA 49,153,261 536,762 - -------------------------------------------------------------------------------------------------------------------------------- Consumer Cyclicals--5.7% - -------------------------------------------------------------------------------------------------------------------------------- Autos & Housing--1.1% Dana Corp.(1) 107,000 2,267,062 - -------------------------------------------------------------------------------------------------------------------------------- IRSA Inversiones y Representaciones SA 292,230 669,341 - -------------------------------------------------------------------------------------------------------------------------------- Owens Corning 192,000 1,776,000 - -------------------------------------------------------------------------------------------------------------------------------- Southdown, Inc. 17,500 1,010,625 - -------------------------------------------------------------------------------------------------------------------------------- Toll Brothers, Inc.(1)(2) 30,500 625,250 ----------- 6,348,278 - -------------------------------------------------------------------------------------------------------------------------------- Leisure & Entertainment--2.2% Berjaya Sports Toto Berhad 190,000 310,000 - -------------------------------------------------------------------------------------------------------------------------------- Brunswick Corp. 80,200 1,328,312 - -------------------------------------------------------------------------------------------------------------------------------- Callaway Golf Co.(1) 140,000 2,283,750 - -------------------------------------------------------------------------------------------------------------------------------- Host Marriott Corp. 130,000 1,218,750 - -------------------------------------------------------------------------------------------------------------------------------- International Game Technology(1)(2) 142,000 3,763,000 - -------------------------------------------------------------------------------------------------------------------------------- Mattel, Inc. 125,000 1,648,441 - -------------------------------------------------------------------------------------------------------------------------------- Shimano, Inc. 100,000 2,410,094 ----------- 12,962,347 - -------------------------------------------------------------------------------------------------------------------------------- Media--1.2% Donnelley (R.R.) & Sons Co. 65,000 1,466,562 - -------------------------------------------------------------------------------------------------------------------------------- Reed International plc 180,000 1,566,886 - -------------------------------------------------------------------------------------------------------------------------------- South China Morning Post Holdings Ltd. 1,608,000 1,247,983 - -------------------------------------------------------------------------------------------------------------------------------- Time Warner, Inc.(1) 32,000 2,432,000 ----------- 6,713,431 - -------------------------------------------------------------------------------------------------------------------------------- Retail: General--0.3% Neiman Marcus Group, Inc. (The), Cl. A(2) 16,000 473,000 - -------------------------------------------------------------------------------------------------------------------------------- Saks, Inc.(2) 93,000 976,500 ----------- 1,449,500 - -------------------------------------------------------------------------------------------------------------------------------- Retail: Specialty--0.6% Borders Group, Inc.(2) 84,000 1,307,250 - -------------------------------------------------------------------------------------------------------------------------------- Gap, Inc. 42,000 1,312,500 - -------------------------------------------------------------------------------------------------------------------------------- Pacific Sunware of California, Inc.(2) 45,000 843,750 ----------- 3,463,500 - -------------------------------------------------------------------------------------------------------------------------------- Textile/Apparel & Home Furnishings--0.3% Jones Apparel Group, Inc.(1)(2) 83,000 1,950,500 Oppenheimer Multiple Strategies Fund/VA 5 Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Consumer Staples--4.6% - -------------------------------------------------------------------------------------------------------------------------------- Beverages--0.1% Diageo plc 62,900 $ 564,680 - -------------------------------------------------------------------------------------------------------------------------------- Broadcasting--0.7% Clear Channel Communications, Inc.(1)(2) 10,000 750,000 - -------------------------------------------------------------------------------------------------------------------------------- Infinity Broadcasting Corp., Cl. A(2) 65,000 2,368,437 - -------------------------------------------------------------------------------------------------------------------------------- Societe Europeenne des Satellites 6,000 1,012,282 ----------- 4,130,719 - -------------------------------------------------------------------------------------------------------------------------------- Entertainment--2.9% Luby's, Inc. 90,000 720,000 - -------------------------------------------------------------------------------------------------------------------------------- News Corp. Ltd. (The), Sponsored ADR, Preference 36,000 1,710,000 - -------------------------------------------------------------------------------------------------------------------------------- Nintendo Co. Ltd. 13,700 2,398,034 - -------------------------------------------------------------------------------------------------------------------------------- Royal Caribbean Cruises Ltd. 63,000 1,165,500 - -------------------------------------------------------------------------------------------------------------------------------- SFX Entertainment, Inc., Cl. A(2) 55,000 2,492,187 - -------------------------------------------------------------------------------------------------------------------------------- Viacom, Inc., Cl. B(1)(2) 119,350 8,138,178 ----------- 16,623,899 - -------------------------------------------------------------------------------------------------------------------------------- Food & Drug Retailers--0.1% Cia Brasileira de Distribuicao Grupo Pao de Acucar, Sponsored ADR 14,000 449,750 - -------------------------------------------------------------------------------------------------------------------------------- Household Goods--0.3% Wella AG 55,900 1,580,779 - -------------------------------------------------------------------------------------------------------------------------------- Wella AG, Preference 5,200 159,511 ----------- 1,740,290 - -------------------------------------------------------------------------------------------------------------------------------- Tobacco--0.5% Philip Morris Cos., Inc. 115,000 3,054,687 - -------------------------------------------------------------------------------------------------------------------------------- Energy--4.9% - -------------------------------------------------------------------------------------------------------------------------------- Energy Services--1.7% Cooper Cameron Corp.(2) 15,000 990,000 - -------------------------------------------------------------------------------------------------------------------------------- Dynegy, Inc. 25,000 1,707,812 - -------------------------------------------------------------------------------------------------------------------------------- Input/Output, Inc.(1)(2) 153,000 1,290,937 - -------------------------------------------------------------------------------------------------------------------------------- Petroleum Geo-Services ASA, Sponsored ADR(2) 50,000 853,125 - -------------------------------------------------------------------------------------------------------------------------------- Santa Fe International Corp.(1) 77,000 2,690,188 - -------------------------------------------------------------------------------------------------------------------------------- Transocean Sedco Forex, Inc.(1) 40,000 2,137,500 ----------- 9,669,562 - -------------------------------------------------------------------------------------------------------------------------------- Oil: Domestic--1.7% Comstock Resources, Inc.(2) 115,000 920,000 - -------------------------------------------------------------------------------------------------------------------------------- Exxon Mobil Corp. 28,501 2,237,329 - -------------------------------------------------------------------------------------------------------------------------------- Kerr-McGee Corp.(1) 50,000 2,946,875 - -------------------------------------------------------------------------------------------------------------------------------- Santa Fe Snyder Corp.(2) 147,900 1,682,363 - -------------------------------------------------------------------------------------------------------------------------------- Unocal Corp. 65,000 2,153,125 ----------- 9,939,692 6 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Oil: International--1.5% Anderson Exploration Ltd.(2) 89,400 $ 1,623,041 - -------------------------------------------------------------------------------------------------------------------------------- Berkley Petroleum Corp.(2) 166,100 1,048,144 - -------------------------------------------------------------------------------------------------------------------------------- Petroleo Brasileiro SA, Preference 33,300 1,006,014 - -------------------------------------------------------------------------------------------------------------------------------- Talisman Energy, Inc.(2) 116,010 3,840,380 - -------------------------------------------------------------------------------------------------------------------------------- Total Fina Elf SA, Sponsored ADR 16,000 1,229,000 ----------- 8,746,579 - -------------------------------------------------------------------------------------------------------------------------------- Financial--9.5% - -------------------------------------------------------------------------------------------------------------------------------- Banks--4.1% ABN Amro Holding NV 62,700 1,542,274 - -------------------------------------------------------------------------------------------------------------------------------- Banco Frances del Rio de la Plata SA 95,000 697,439 - -------------------------------------------------------------------------------------------------------------------------------- Bank of America Corp. 144,000 6,192,000 - -------------------------------------------------------------------------------------------------------------------------------- Chase Manhattan Corp.(1) 172,650 7,952,691 - -------------------------------------------------------------------------------------------------------------------------------- Knight Trading Group, Inc.(2) 24,000 715,500 - -------------------------------------------------------------------------------------------------------------------------------- Societe Generale, Cl. A 57,000 3,442,333 - -------------------------------------------------------------------------------------------------------------------------------- UBS AG, Reg. 8,350 1,227,262 - -------------------------------------------------------------------------------------------------------------------------------- UniCredito Italiano SpA 414,000 1,988,271 ----------- 23,757,770 - -------------------------------------------------------------------------------------------------------------------------------- Diversified Financial--1.3% C.I.T. Group, Inc., Cl. A 76,000 1,235,000 - -------------------------------------------------------------------------------------------------------------------------------- Equifax, Inc. 63,400 1,664,250 - -------------------------------------------------------------------------------------------------------------------------------- Finova Group, Inc. 80,000 1,040,000 - -------------------------------------------------------------------------------------------------------------------------------- ICICI Ltd., Sponsored ADR 35,500 665,625 - -------------------------------------------------------------------------------------------------------------------------------- Morgan Stanley Dean Witter & Co. 25,000 2,081,250 - -------------------------------------------------------------------------------------------------------------------------------- Simon Property Group, Inc. 37,500 832,031 ----------- 7,518,156 - -------------------------------------------------------------------------------------------------------------------------------- Insurance--1.7% ACE Ltd.(1) 135,000 3,780,000 - -------------------------------------------------------------------------------------------------------------------------------- Aetna, Inc.(1) 20,000 1,283,750 - -------------------------------------------------------------------------------------------------------------------------------- Skandia Forsakrings AB 67,500 1,793,125 - -------------------------------------------------------------------------------------------------------------------------------- XL Capital Ltd., Cl. A 57,300 3,101,363 ----------- 9,958,238 - -------------------------------------------------------------------------------------------------------------------------------- Real Estate Investment Trusts--2.2% Archstone Communities Trust 52,000 1,095,250 - -------------------------------------------------------------------------------------------------------------------------------- Avalonbay Communities, Inc. 30,732 1,283,061 - -------------------------------------------------------------------------------------------------------------------------------- Brandywine Realty Trust 56,000 1,071,000 - -------------------------------------------------------------------------------------------------------------------------------- Camden Property Trust 40,000 1,175,000 - -------------------------------------------------------------------------------------------------------------------------------- CarrAmerica Realty Corp. 48,000 1,272,000 - -------------------------------------------------------------------------------------------------------------------------------- Chelsea GCA Realty, Inc. 32,000 1,106,000 - -------------------------------------------------------------------------------------------------------------------------------- Developers Diversified Realty Corp. 62,000 926,125 - -------------------------------------------------------------------------------------------------------------------------------- Equity Office Properties Trust 28,960 798,210 - -------------------------------------------------------------------------------------------------------------------------------- JDN Realty Corp. 60,000 611,250 - -------------------------------------------------------------------------------------------------------------------------------- Manufactured Home Communities, Inc. 44,000 1,053,250 Oppenheimer Multiple Strategies Fund/VA 7 Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Real Estate Investment Trusts (continued) Post Properties, Inc. 28,000 $ 1,232,000 - -------------------------------------------------------------------------------------------------------------------------------- Shurgard Storage Centers, Inc. 44,000 990,000 ----------- 12,613,146 - -------------------------------------------------------------------------------------------------------------------------------- Savings & Loans--0.2% Washington Mutual, Inc. 48,000 1,386,000 - -------------------------------------------------------------------------------------------------------------------------------- Healthcare--5.5% - -------------------------------------------------------------------------------------------------------------------------------- Healthcare/Drugs--4.5% Abbott Laboratories(1) 42,000 1,871,625 - -------------------------------------------------------------------------------------------------------------------------------- Alkermes, Inc.(2) 22,600 1,065,025 - -------------------------------------------------------------------------------------------------------------------------------- American Home Products Corp.(1) 48,500 2,849,375 - -------------------------------------------------------------------------------------------------------------------------------- AstraZeneca Group plc 60,540 2,829,940 - -------------------------------------------------------------------------------------------------------------------------------- Elan Corp. plc, ADR(2) 20,000 968,750 - -------------------------------------------------------------------------------------------------------------------------------- Human Genome Sciences, Inc.(1)(2) 12,500 1,667,188 - -------------------------------------------------------------------------------------------------------------------------------- Johnson & Johnson(1) 44,295 4,512,553 - -------------------------------------------------------------------------------------------------------------------------------- Merck & Co., Inc.(1) 31,500 2,413,688 - -------------------------------------------------------------------------------------------------------------------------------- Mylan Laboratories, Inc.(1) 70,000 1,277,500 - -------------------------------------------------------------------------------------------------------------------------------- Novartis AG 1,700 2,701,433 - -------------------------------------------------------------------------------------------------------------------------------- Pliva d.d., Sponsored GDR(4) 20,000 208,000 - -------------------------------------------------------------------------------------------------------------------------------- SmithKline Beecham plc, Cl. A, Sponsored ADR 30,000 1,955,625 - -------------------------------------------------------------------------------------------------------------------------------- UnitedHealth Group, Inc.(1) 16,000 1,372,000 ----------- 25,692,702 - -------------------------------------------------------------------------------------------------------------------------------- Healthcare/Supplies & Services--1.0% Acuson Corp.(2) 180,000 2,430,000 - -------------------------------------------------------------------------------------------------------------------------------- Affymetrix, Inc.(1)(2) 1,600 264,200 - -------------------------------------------------------------------------------------------------------------------------------- Covance, Inc.(2) 165,000 1,454,063 - -------------------------------------------------------------------------------------------------------------------------------- Manor Care, Inc.(1)(2) 55,000 385,000 - -------------------------------------------------------------------------------------------------------------------------------- St. Jude Medical, Inc.(1)(2) 26,000 1,192,750 ----------- 5,726,013 - -------------------------------------------------------------------------------------------------------------------------------- Technology--13.7% - -------------------------------------------------------------------------------------------------------------------------------- Computer Hardware--3.0% Canon, Inc. 48,000 2,395,350 - -------------------------------------------------------------------------------------------------------------------------------- Compaq Computer Corp. 63,000 1,610,438 - -------------------------------------------------------------------------------------------------------------------------------- International Business Machines Corp.(1) 120,000 13,147,500 ----------- 17,153,288 - -------------------------------------------------------------------------------------------------------------------------------- Computer Services--0.5% Ceridian Corp.(2) 112,000 2,695,000 - -------------------------------------------------------------------------------------------------------------------------------- Computer Software--1.6% Computer Associates International, Inc.(1) 53,599 2,743,624 - -------------------------------------------------------------------------------------------------------------------------------- Compuware Corp.(2) 56,000 581,000 - -------------------------------------------------------------------------------------------------------------------------------- I2 Technologies, Inc.(1)(2) 3,600 375,356 - -------------------------------------------------------------------------------------------------------------------------------- Microsoft Corp.(2) 5,500 440,000 - -------------------------------------------------------------------------------------------------------------------------------- Novell, Inc.(1)(2) 126,000 1,165,500 - -------------------------------------------------------------------------------------------------------------------------------- Peoplesoft, Inc.(2) 79,000 1,323,250 8 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Computer Software (continued) Research in Motion Ltd.(1)(2) 6,600 $ 298,650 - -------------------------------------------------------------------------------------------------------------------------------- Sabre Holdings Corp. 53,500 1,524,750 - -------------------------------------------------------------------------------------------------------------------------------- Structural Dynamics Research Corp.(2) 167 2,515 - -------------------------------------------------------------------------------------------------------------------------------- Veritas Software Corp.(1)(2) 3,250 367,301 - -------------------------------------------------------------------------------------------------------------------------------- Yahoo!, Inc.(1)(2) 5,180 641,673 ------------ 9,463,619 - -------------------------------------------------------------------------------------------------------------------------------- Communications Equipment--0.7% Cisco Systems, Inc.(1) 46,000 2,923,875 - -------------------------------------------------------------------------------------------------------------------------------- Lucent Technologies, Inc. 22,500 1,333,125 ------------ 4,257,000 - -------------------------------------------------------------------------------------------------------------------------------- Electronics--7.3% Analog Devices, Inc.(1)(2) 84,600 6,429,600 - -------------------------------------------------------------------------------------------------------------------------------- ASM Lithography Holding NV(1)(2) 42,500 1,875,313 - -------------------------------------------------------------------------------------------------------------------------------- General Motors Corp., Cl. H(1)(2) 25,700 2,255,175 - -------------------------------------------------------------------------------------------------------------------------------- Grainger (W.W.), Inc. 29,000 893,563 - -------------------------------------------------------------------------------------------------------------------------------- Intel Corp.(1) 124,000 16,577,250 - -------------------------------------------------------------------------------------------------------------------------------- JDS Uniphase Corp.(1)(2) 13,800 1,654,275 - -------------------------------------------------------------------------------------------------------------------------------- Keyence Corp. 8,360 2,765,465 - -------------------------------------------------------------------------------------------------------------------------------- Loral Space & Communications Ltd.(2) 143,900 998,306 - -------------------------------------------------------------------------------------------------------------------------------- Methode Electronics, Inc., Cl. A(1) 80,000 3,090,000 - -------------------------------------------------------------------------------------------------------------------------------- QLogic Corp.(2) 8,000 528,500 - -------------------------------------------------------------------------------------------------------------------------------- RF Micro Devices, Inc.(2) 3,000 262,875 - -------------------------------------------------------------------------------------------------------------------------------- STMicroelectronics NV, NY Registered Shares(1) 52,800 3,389,100 - -------------------------------------------------------------------------------------------------------------------------------- Teradyne, Inc.(1)(2) 20,500 1,506,750 ------------ 42,226,172 - -------------------------------------------------------------------------------------------------------------------------------- Photography--0.6% Eastman Kodak Co. 32,000 1,904,000 - -------------------------------------------------------------------------------------------------------------------------------- Xerox Corp. 67,500 1,400,625 ------------ 3,304,625 - -------------------------------------------------------------------------------------------------------------------------------- Transportation--0.4% - -------------------------------------------------------------------------------------------------------------------------------- Railroads & Truckers--0.4% Burlington Northern Santa Fe Corp. 67,000 1,536,813 - -------------------------------------------------------------------------------------------------------------------------------- Werner Enterprises, Inc. 91,000 1,052,188 ------------ 2,589,001 - -------------------------------------------------------------------------------------------------------------------------------- Utilities--0.4% - -------------------------------------------------------------------------------------------------------------------------------- Electric Utilities--0.4% Southern Co. 90,000 2,098,125 ------------ Total Common Stocks (Cost $209,075,643) 298,366,002 Oppenheimer Multiple Strategies Fund/VA 9 Statement of Investments (Unaudited) (Continued) Market Value Shares Note 1 ================================================================================================================================ Preferred Stocks--1.7% - -------------------------------------------------------------------------------------------------------------------------------- ICG Communications, Inc., 6.75% Cum. Cv., Non-Vtg. 45,000 $ 2,345,625 - -------------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc., 7% Cv. 30,000 667,500 - -------------------------------------------------------------------------------------------------------------------------------- MediaOne Group, Inc., 7% Cv. Premium Income Exchangeable Securities for Vodafone Airtouch plc common stock 15,000 607,500 - -------------------------------------------------------------------------------------------------------------------------------- Qwest Trends Trust, 5.75% Cv.(4) 65,000 5,289,375 - -------------------------------------------------------------------------------------------------------------------------------- Sovereign Capital Trust II, 7.50% Cv. Preferred Income Equity Redeemable Stock, Units (each unit consists of one preferred plus one warrant to purchase 5.3355 shares of Sovereign Bancorp common stock)(5) 12,500 612,500 ----------- Total Preferred Stocks (Cost $8,452,846) 9,522,500 Units ================================================================================================================================ Rights, Warrants and Certificates--0.0% - -------------------------------------------------------------------------------------------------------------------------------- Covergent Communications, Inc. Wts., Exp. 4/1/08(3) 1,000 22,500 - -------------------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp. Wts., Exp. 11/1/02 9,232 27,696 - -------------------------------------------------------------------------------------------------------------------------------- HF Holdings, Inc. Wts., Exp. 9/27/00(3) 2,592 259 - -------------------------------------------------------------------------------------------------------------------------------- PE Corp. Cl. G Wts., Exp. 9/11/03 249 6,723 - -------------------------------------------------------------------------------------------------------------------------------- Terex Corp. Rts., Exp. 5/15/02(3) 4,000 56,500 ----------- Total Rights, Warrants and Certificates (Cost $59,660) 113,678 Principal Amount ================================================================================================================================ Mortgage-Backed Obligations--1.6% - -------------------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., Gtd. Multiclass Mtg. Participation Certificates, 7%, 5/1/29 $ 4,599,940 4,448,510 - -------------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn., 6.50%, 11/1/27-12/1/27 3,670,008 3,465,112 - -------------------------------------------------------------------------------------------------------------------------------- Government National Mortgage Assn., 8%, 4/15/23 1,419,714 1,439,790 ----------- Total Mortgage-Backed Obligations (Cost $9,680,544) 9,353,412 ================================================================================================================================ U.S. Government Obligations--11.8% - -------------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn. Nts., 7.125%, 1/15/30 400,000 402,223 - -------------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Bonds: 8.875%, 8/15/17 2,900,000 3,689,345 STRIPS, 6.30%, 8/15/25(6) 10,965,000 2,424,010 STRIPS, 6.53%, 8/15/15(6) 6,035,000 2,366,227 STRIPS, 7.10%, 11/15/18(6) 13,600,000 4,360,568 STRIPS, 7.26%, 11/15/18(6) 8,500,000 2,735,062 STRIPS, 7.31%, 8/15/19(6) 15,300,000 4,682,504 - -------------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Nts.: 5.875%, 9/30/02 15,000,000 14,831,250 6.125%, 9/30/00(7) 15,000,000 15,004,695 6.25%, 2/15/07 8,800,000 8,811,000 6.375%, 8/15/02 5,000,000 4,993,750 6.50%, 10/15/06 3,710,000 3,752,899 ----------- Total U.S. Government Obligations (Cost $66,586,408) 68,053,533 10 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 ================================================================================================================================ Foreign Government Obligations--19.4% - -------------------------------------------------------------------------------------------------------------------------------- Argentina--5.3% Argentina (Republic of) Bonds, Series L, 7.375%, 3/31/05(8) $ 4,960,000 $ 4,538,400 - -------------------------------------------------------------------------------------------------------------------------------- Argentina (Republic of) Nts., 14.25%, 11/30/02(3)(8) 13,125,000 13,092,187 - -------------------------------------------------------------------------------------------------------------------------------- Argentina (Republic of) Par Bonds, 6%, 3/31/23(8) 19,750,000 13,109,062 ------------ 30,739,649 - -------------------------------------------------------------------------------------------------------------------------------- Australia--0.5% New South Wales Treasury Corp. Gtd. Bonds, 7%, 4/1/04(AUD) 3,160,000 1,937,714 - -------------------------------------------------------------------------------------------------------------------------------- Queensland Treasury Corp. Exchangeable Gtd. Nts., 10.50%, 5/15/03(AUD) 1,800,000 1,199,910 ------------ 3,137,624 - -------------------------------------------------------------------------------------------------------------------------------- Brazil--4.6% Brazil (Federal Republic of) Debt Conversion Bonds, Series 20 yr., 8%, 4/15/14 17,116,599 12,623,492 - -------------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Eligible Interest Bonds, 7.375%, 4/15/06(8) 15,298,500 13,979,004 ------------ 26,602,496 - -------------------------------------------------------------------------------------------------------------------------------- Canada--2.9% Canada (Government of) Bonds: 8.50%, 4/1/02(CAD) 1,500,000 1,055,912 8.75%, 12/1/05(CAD) 12,200,000 9,289,521 9.75%, 6/1/01(CAD) 2,000,000 1,396,814 9.75%, 12/1/01(CAD) 3,000,000 2,130,310 Series WL43, 5.75%, 6/1/29(CAD) 3,670,000 2,554,907 ------------ 16,427,464 - -------------------------------------------------------------------------------------------------------------------------------- Denmark--0.8% Denmark (Kingdom of) Bonds, 8%, 3/15/06(DKK) 32,100,000 4,566,034 - -------------------------------------------------------------------------------------------------------------------------------- Great Britain--1.2% United Kingdom Treasury Bonds, 6.75%, 11/26/04(GBP) 2,680,000 4,231,714 - -------------------------------------------------------------------------------------------------------------------------------- United Kingdom Treasury Nts., 13%, 7/14/00(GBP) 1,590,000 2,409,508 ------------ 6,641,222 - -------------------------------------------------------------------------------------------------------------------------------- Mexico--0.6% United Mexican States Collateralized Fixed Rate Par Bonds, Series W-A, 6.25%, 12/31/19 4,450,000 3,693,500 - -------------------------------------------------------------------------------------------------------------------------------- New Zealand--3.0% New Zealand (Government of) Bonds: 8%, 2/15/01(NZD) 19,440,000 9,213,016 10%, 3/15/02(NZD) 16,800,000 8,301,719 ------------ 17,514,735 - -------------------------------------------------------------------------------------------------------------------------------- Philippines--0.2% Philippines (Republic of) Bonds, 8.60%, 6/15/27 1,500,000 1,068,750 - -------------------------------------------------------------------------------------------------------------------------------- South Africa--0.3% Eskom Depositary Receipts, Series E168, 11%, 6/1/08(ZAR) 12,570,000 1,547,934 ------------ Total Foreign Government Obligations (Cost $116,730,479) 111,939,408 Oppenheimer Multiple Strategies Fund/VA 11 Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 ================================================================================================================================ Non-Convertible Corporate Bonds and Notes--8.0% - -------------------------------------------------------------------------------------------------------------------------------- Basic Materials--1.3% - -------------------------------------------------------------------------------------------------------------------------------- Chemicals--0.6% Avecia Group plc, 11% Sr. Unsec. Nts., 7/1/09 $ 500,000 $ 492,500 - -------------------------------------------------------------------------------------------------------------------------------- Huntsman Corp./ICI Chemical Co. plc, Zero Coupon Sr. Unsec. Disc. Nts., 13.08%, 12/31/09(6) 1,000,000 335,000 - -------------------------------------------------------------------------------------------------------------------------------- Lyondell Chemical Co.: 9.875% Sec. Nts., Series B, 5/1/07 500,000 495,000 10.875% Sr. Sub. Nts., 5/1/09 500,000 498,750 - -------------------------------------------------------------------------------------------------------------------------------- NL Industries, Inc., 11.75% Sr. Sec. Nts., 10/15/03 85,000 87,125 - -------------------------------------------------------------------------------------------------------------------------------- Polymer Group, Inc., 9% Sr. Sub. Nts., 7/1/07 500,000 427,500 - -------------------------------------------------------------------------------------------------------------------------------- Rohm & Haas Co., 7.85% Unsec. Debs., 7/15/29 400,000 405,510 - -------------------------------------------------------------------------------------------------------------------------------- Sterling Chemicals, Inc.: 11.75% Sr. Unsec. Sub. Nts., 8/15/06 535,000 441,375 12.375% Sr. Sec. Nts., Series B, 7/15/06 250,000 255,000 ---------- 3,437,760 - -------------------------------------------------------------------------------------------------------------------------------- Metals--0.4% AK Steel Corp., 9.125% Sr. Nts., 12/15/06 1,215,000 1,172,475 - -------------------------------------------------------------------------------------------------------------------------------- Aluminum--0.0% Kaiser Aluminum & Chemical Corp., 12.75% Sr. Sub. Nts., 2/1/03 1,000,000 915,000 - -------------------------------------------------------------------------------------------------------------------------------- Metals: Diversified--0.0% Metallurg, Inc., 11% Sr. Nts., 12/1/07 450,000 357,750 ---------- 2,445,225 - -------------------------------------------------------------------------------------------------------------------------------- Paper--0.3% Aracruz Celulose SA, 10.375% Debs., 1/31/02(4) 430,000 435,375 - -------------------------------------------------------------------------------------------------------------------------------- Doman Industries Ltd., 8.75% Sr. Nts., 3/15/04 500,000 390,000 - -------------------------------------------------------------------------------------------------------------------------------- Repap New Brunswick, Inc.: 10.625% Second Priority Sr. Sec. Nts., 4/15/05 300,000 265,500 11.50% Sr. Sec. Nts., 6/1/04 200,000 202,000 - -------------------------------------------------------------------------------------------------------------------------------- Riverwood International Corp.: 10.625% Sr. Unsec. Nts., 8/1/07 500,000 487,500 10.875% Sr. Sub. Nts., 4/1/08 250,000 221,250 ---------- 2,001,625 - -------------------------------------------------------------------------------------------------------------------------------- Capital Goods--0.5% - -------------------------------------------------------------------------------------------------------------------------------- Aerospace/Defense--0.0% Loral Space & Communications Ltd., 9.50% Sr. Nts., 1/15/06 200,000 146,000 - -------------------------------------------------------------------------------------------------------------------------------- Industrial Services--0.2% Allied Waste North America, Inc., 10% Sr. Unsec. Sub. Nts., Series B, 8/1/09 750,000 630,000 - -------------------------------------------------------------------------------------------------------------------------------- United Rentals, Inc., 9% Sr. Unsec. Sub. Nts., Series B, 4/1/09 500,000 445,000 ---------- 1,075,000 - -------------------------------------------------------------------------------------------------------------------------------- Manufacturing--0.3% Blount, Inc., 13% Sr. Sub. Nts., 8/1/09 700,000 717,500 - -------------------------------------------------------------------------------------------------------------------------------- Caterpillar, Inc., 7.375% Unsec. Debs., 3/1/97 400,000 362,176 - -------------------------------------------------------------------------------------------------------------------------------- International Wire Group, Inc., 11.75% Sr. Sub. Nts., Series B, 6/1/05 500,000 505,000 ---------- 1,584,676 12 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Communication Services--1.9% - -------------------------------------------------------------------------------------------------------------------------------- Telecommunications: Long Distance--1.0% 360networks, Inc., 12% Sr. Unsec. Sub. Nts., 8/1/09 $ 400,000 $ 380,000 - -------------------------------------------------------------------------------------------------------------------------------- Exodus Communications, Inc., 11.25% Sr. Nts., 7/1/08 500,000 497,500 - -------------------------------------------------------------------------------------------------------------------------------- Global Crossing Holdings Ltd., 9.625% Sr. Nts., 5/15/08 750,000 731,250 - -------------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc., 8.50% Sr. Nts., Series B, 1/15/08 500,000 462,500 - -------------------------------------------------------------------------------------------------------------------------------- Level 3 Communications, Inc., 11% Sr. Nts., 3/15/08(4) 200,000 199,000 - -------------------------------------------------------------------------------------------------------------------------------- Metromedia Fiber Network, Inc.: 10% Sr. Nts., 12/15/09 250,000 247,500 10% Sr. Unsec. Nts., Series B, 11/15/08 750,000 742,500 - -------------------------------------------------------------------------------------------------------------------------------- NEXTLINK Communications, Inc., 10.75% Sr. Unsec. Nts., 6/1/09 500,000 495,000 - -------------------------------------------------------------------------------------------------------------------------------- PSINet, Inc., 10% Sr. Unsec. Nts., Series B, 2/15/05 1,000,000 925,000 - -------------------------------------------------------------------------------------------------------------------------------- Verio, Inc., 11.25% Sr. Unsec. Nts., 12/1/08 600,000 676,500 - -------------------------------------------------------------------------------------------------------------------------------- Vodafone AirTouch plc, 7.75% Unsec. Unsub. Nts., 2/15/10(4) 400,000 397,244 - -------------------------------------------------------------------------------------------------------------------------------- WorldCom, Inc., 6.95% Sr. Unsec. Nts., 8/15/28 400,000 354,414 ---------- 6,108,408 - -------------------------------------------------------------------------------------------------------------------------------- Telecommunications: Wireless--0.9% Crown Castle International Corp.: 9% Sr. Nts., 5/15/11 500,000 463,750 10.75% Sr. Nts., 8/1/11 350,000 356,562 - -------------------------------------------------------------------------------------------------------------------------------- Millicom International Cellular SA, 0%/13.50% Sr. Disc. Nts., 6/1/06(3)(9) 750,000 641,250 - -------------------------------------------------------------------------------------------------------------------------------- Nextel Communications, Inc.: 0%/9.95% Sr. Disc. Nts., 2/15/08(9) 200,000 147,500 9.375% Sr. Unsec. Nts., 11/15/09 500,000 480,000 - -------------------------------------------------------------------------------------------------------------------------------- Omnipoint Corp.: 11.50% Sr. Nts., 9/15/09(4) 250,000 268,750 11.625% Sr. Nts., 8/15/06 535,000 580,475 11.625% Sr. Nts., Series A, 8/15/06 590,000 640,150 - -------------------------------------------------------------------------------------------------------------------------------- ORBCOMM Global LP/ORBCOMM Capital Corp., 14% Sr. Nts., 8/15/04(3) 200,000 157,000 - -------------------------------------------------------------------------------------------------------------------------------- Rural Cellular Corp., 9.625% Sr. Sub. Nts., Series B, 5/15/08 750,000 731,250 - -------------------------------------------------------------------------------------------------------------------------------- Spectrasite Holdings, Inc., 10.75% Sr. Nts., 3/15/10(4) 500,000 501,250 - -------------------------------------------------------------------------------------------------------------------------------- VoiceStream Wireless Corp., 10.375% Sr. Nts., 11/15/09(4) 400,000 416,000 ---------- 5,383,937 - -------------------------------------------------------------------------------------------------------------------------------- Consumer Cyclicals--0.8% - -------------------------------------------------------------------------------------------------------------------------------- Autos & Housing--0.3% Building Materials Corp. of America, 8.625% Sr. Nts., Series B, 12/15/06 100,000 83,750 - -------------------------------------------------------------------------------------------------------------------------------- Cambridge Industries, Inc., 10.25% Sr. Sub. Nts., Series B, 7/15/07 300,000 76,500 - -------------------------------------------------------------------------------------------------------------------------------- Hayes Wheels International, Inc., 11% Sr. Sub. Nts., 7/15/06 500,000 493,750 - -------------------------------------------------------------------------------------------------------------------------------- Icon Health & Fitness, Inc., 12% Unsec. Nts., 7/15/05(3) 271,000 176,150 - -------------------------------------------------------------------------------------------------------------------------------- Kaufman & Broad Home Corp., 7.75% Sr. Nts., 10/15/04 400,000 364,000 - -------------------------------------------------------------------------------------------------------------------------------- Tenneco, Inc., 11.625% Sr. Unsec. Sub. Nts., Series B, 10/15/09 400,000 358,000 ---------- 1,552,150 - -------------------------------------------------------------------------------------------------------------------------------- Leisure & Entertainment--0.2% Meristar Hospitality Corp., 8.75% Sr. Unsec. Sub. Nts., 8/15/07 500,000 447,500 - -------------------------------------------------------------------------------------------------------------------------------- Premier Parks, Inc., 9.75% Sr. Nts., 6/15/07 500,000 485,625 ---------- 933,125 Oppenheimer Multiple Strategies Fund/VA 13 Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Media--0.2% Lamar Media Corp., 9.625% Sr. Unsec. Sub. Nts., 12/1/06 $ 150,000 $ 151,500 - -------------------------------------------------------------------------------------------------------------------------------- Time Warner Entertainment Co. LP, 10.15% Sr. Nts., 5/1/12 500,000 582,234 - -------------------------------------------------------------------------------------------------------------------------------- Time Warner, Inc., 9.125% Debs., 1/15/13 500,000 543,658 ---------- 1,277,392 - -------------------------------------------------------------------------------------------------------------------------------- Retail: General--0.1% Wal-Mart Stores, Inc., 7.55% Sr. Unsec. Nts., 2/15/30 400,000 409,994 - -------------------------------------------------------------------------------------------------------------------------------- Consumer Staples--1.8% - -------------------------------------------------------------------------------------------------------------------------------- Beverages--0.2% Canandaigua Brands, Inc., 8.625% Sr. Unsec. Nts., 8/1/06 700,000 694,750 - -------------------------------------------------------------------------------------------------------------------------------- Coca-Cola Co., 7.375% Debs., 7/29/93 360,000 340,809 ---------- 1,035,559 - -------------------------------------------------------------------------------------------------------------------------------- Broadcasting--1.5% Adelphia Communications Corp., 9.375% Sr. Nts., 11/15/09 750,000 697,500 - -------------------------------------------------------------------------------------------------------------------------------- Chancellor Media Corp., 8.75% Sr. Unsec. Sub. Nts., Series B, 6/15/07 1,000,000 1,007,500 - -------------------------------------------------------------------------------------------------------------------------------- Charter Communications Holdings LLC/Charter Communications Holdings Capital Corp.: 0%/9.92% Sr. Unsec. Disc. Nts., 4/1/11(9) 750,000 427,500 8.625% Sr. Unsec. Nts., 4/1/09 750,000 662,813 - -------------------------------------------------------------------------------------------------------------------------------- CSC Holdings, Inc., 9.875% Sr. Sub. Nts., 5/15/06 250,000 256,250 - -------------------------------------------------------------------------------------------------------------------------------- Cumulus Media, Inc., 10.375% Sr. Unsec. Sub. Nts., 7/1/08 300,000 255,000 - -------------------------------------------------------------------------------------------------------------------------------- EchoStar DBS Corp., 9.375% Sr. Unsec. Nts., 2/1/09 700,000 675,500 - -------------------------------------------------------------------------------------------------------------------------------- NTL Communications Corp., 0%/12.375% Sr. Unsec. Nts., Series B, 10/1/08(9) 500,000 320,000 - -------------------------------------------------------------------------------------------------------------------------------- NTL, Inc., 0%/9.75% Sr. Deferred Coupon Nts., Series B, 4/1/08(9) 500,000 313,750 - -------------------------------------------------------------------------------------------------------------------------------- Rogers Cablesystems Ltd., 10% Second Priority Sr. Sec. Debs., 12/1/07 1,000,000 1,027,500 - -------------------------------------------------------------------------------------------------------------------------------- Sinclair Broadcast Group, Inc.: 8.75% Sr. Sub. Nts., 12/15/07 500,000 442,500 9% Sr. Unsec. Sub. Nts., 7/15/07 375,000 338,438 - -------------------------------------------------------------------------------------------------------------------------------- Telewest Communications plc: 0%/11% Sr. Disc. Debs., 10/1/07(9) 1,000,000 952,500 9.625% Sr. Debs., 10/1/06 500,000 470,000 - -------------------------------------------------------------------------------------------------------------------------------- United Pan-Europe Communications NV, 10.875% Sr. Unsec. Nts., Series B, 8/1/09 400,000 350,000 - -------------------------------------------------------------------------------------------------------------------------------- Young Broadcasting, Inc., 8.75% Sr. Sub. Debs., 6/15/07 700,000 647,500 ---------- 8,844,251 - -------------------------------------------------------------------------------------------------------------------------------- Food & Drug Retailers--0.1% Fleming Cos., Inc.: 10.50% Sr. Sub. Nts., Series B, 12/1/04 300,000 270,000 10.625% Sr. Sub. Nts., Series B, 7/31/07 500,000 420,000 ---------- 690,000 - -------------------------------------------------------------------------------------------------------------------------------- Household Goods--0.0% Revlon Consumer Products Corp.: 8.625% Sr. Unsec. Sub. Nts., 2/1/08 100,000 51,000 9% Sr. Nts., 11/1/06 70,000 50,750 ---------- 101,750 14 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Energy--0.5% - -------------------------------------------------------------------------------------------------------------------------------- Energy Services--0.4% Chesapeake Energy Corp., 9.625% Sr. Unsec. Nts., Series B, 5/1/05 $ 500,000 $ 487,500 - -------------------------------------------------------------------------------------------------------------------------------- Frontier Oil Corp., 11.75% Sr. Nts., 11/15/09 250,000 251,250 - -------------------------------------------------------------------------------------------------------------------------------- Gothic Production Corp., 11.125% Sr. Sec. Nts., Series B, 5/1/05(4) 950,000 890,625 - -------------------------------------------------------------------------------------------------------------------------------- R&B Falcon Corp., 9.50% Sr. Unsec. Nts., 12/15/08 500,000 505,000 ---------- 2,134,375 - -------------------------------------------------------------------------------------------------------------------------------- Oil: Domestic--0.1% Conoco, Inc., 6.95% Sr. Unsec. Nts., 4/15/29 400,000 365,618 - -------------------------------------------------------------------------------------------------------------------------------- Financial--0.5% - -------------------------------------------------------------------------------------------------------------------------------- Banks--0.2% ABN Amro Bank NV (NY Branch), 7.125% Sub. Nts., Series B, 10/15/93 400,000 340,458 - -------------------------------------------------------------------------------------------------------------------------------- Bank of America Corp., 7.80% Jr. Unsec. Sub. Nts., 2/15/10 400,000 398,548 - -------------------------------------------------------------------------------------------------------------------------------- First Chicago Corp., 11.25% Sub. Nts., 2/20/01 250,000 255,923 ---------- 994,929 - -------------------------------------------------------------------------------------------------------------------------------- Diversified Financial--0.2% Ford Motor Co., 7.70% Unsec. Debs., 5/15/97 400,000 371,479 - -------------------------------------------------------------------------------------------------------------------------------- Goldman Sachs Group, Inc. (The), 7.80% Sr. Unsec. Unsub. Nts., Series B, 1/28/10 400,000 397,012 - -------------------------------------------------------------------------------------------------------------------------------- IBM Corp., 7.125% Sr. Unsec. Unsub. Debs., 12/1/96 400,000 366,489 ---------- 1,134,980 - -------------------------------------------------------------------------------------------------------------------------------- Insurance--0.1% Travelers Group, Inc., 6.875% Unsec. Nts., 2/15/98 450,000 387,181 - -------------------------------------------------------------------------------------------------------------------------------- Healthcare--0.0% - -------------------------------------------------------------------------------------------------------------------------------- Healthcare/Drugs--0.0% Amgen, Inc., 8.125% Unsec. Debs., 4/1/97 91,000 92,126 - -------------------------------------------------------------------------------------------------------------------------------- Tenet Healthcare Corp., 9.25% Sr. Nts., 9/1/10(4) 200,000 202,500 ---------- 294,626 - -------------------------------------------------------------------------------------------------------------------------------- Healthcare/Supplies & Services--0.0% Sun Healthcare Group, Inc., 9.375% Sr. Sub. Nts., 5/1/08(2)(3)(10) 1,000,000 70,000 - -------------------------------------------------------------------------------------------------------------------------------- Tenet Healthcare Corp., 8.125% Sr. Unsec. Sub. Nts., Series B, 12/1/08 200,000 184,000 ---------- 254,000 - -------------------------------------------------------------------------------------------------------------------------------- Technology--0.1% - -------------------------------------------------------------------------------------------------------------------------------- Electronics--0.1% Amkor Technologies, Inc., 9.25% Sr. Unsec. Nts., 5/1/06 500,000 495,625 - -------------------------------------------------------------------------------------------------------------------------------- Motorola, Inc., 5.22% Unsec. Debs., 10/1/97 140,000 91,672 ---------- 587,297 Oppenheimer Multiple Strategies Fund/VA 15 Statement of Investments (Unaudited) (Continued) Principal Market Value Amount Note 1 - -------------------------------------------------------------------------------------------------------------------------------- Transportation--0.3% - -------------------------------------------------------------------------------------------------------------------------------- Air Transportation--0.2% Amtran, Inc., 10.50% Sr. Nts., 8/1/04 $ 500,000 $ 463,750 - -------------------------------------------------------------------------------------------------------------------------------- Trans World Airlines, Inc., 11.50% Sr. Sec. Nts., 12/15/04 1,000,000 735,000 ------------ 1,198,750 - -------------------------------------------------------------------------------------------------------------------------------- Railroads & Truckers--0.1% Norfolk Southern Corp., 7.90% Sr. Bonds, 5/15/97 400,000 371,569 - -------------------------------------------------------------------------------------------------------------------------------- Shipping--0.0% Navigator Gas Transport plc, 10.50% First Priority Ship Mtg. Nts., 6/30/07(4) 500,000 202,500 - -------------------------------------------------------------------------------------------------------------------------------- Utilities--0.3% - -------------------------------------------------------------------------------------------------------------------------------- Electric Utilities--0.1% Calpine Corp., 8.75% Sr. Nts., 7/15/07 400,000 390,500 - -------------------------------------------------------------------------------------------------------------------------------- Gas Utilities--0.2% Funding Corp./Beaver Valley Funding Corp., 9% Second Lease Obligation Bonds, 6/1/17 989,000 989,000 ------------ Total Non-Convertible Corporate Bonds and Notes (Cost $49,495,788) 46,332,177 ================================================================================================================================ Convertible Corporate Bonds and Notes--0.7% - -------------------------------------------------------------------------------------------------------------------------------- Affymetrix, Inc., 4.75% Cv. Sub. Nts., 2/15/07(4) 1,000,000 782,500 - -------------------------------------------------------------------------------------------------------------------------------- Amkor Technologies, Inc., 5% Cv. Nts., 3/15/07(4) 600,000 546,750 - -------------------------------------------------------------------------------------------------------------------------------- Juniper Networks, Inc., 4.75% Cv. Unsec. Sub. Nts., 3/15/07 600,000 666,000 - -------------------------------------------------------------------------------------------------------------------------------- Level 3 Communications, Inc., 6% Cv. Unsec. Sub. Nts., 3/15/10 500,000 454,375 - -------------------------------------------------------------------------------------------------------------------------------- Nextel Communications, Inc., 5.25% Cv. Sr. Nts., 1/15/10(4) 700,000 716,625 - -------------------------------------------------------------------------------------------------------------------------------- Photronics, Inc., 6% Cv. Sub. Nts., 6/1/04 700,000 798,000 ------------ Total Convertible Corporate Bonds and Notes (Cost $3,590,787) 3,964,250 ================================================================================================================================ Repurchase Agreements--4.5% - -------------------------------------------------------------------------------------------------------------------------------- Repurchase agreement with Banc One Capital Markets, Inc., 6.55%, dated 6/30/00, to be repurchased at $25,848,101 on 7/3/00, collateralized by U.S. Treasury Nts., 5%-7.50%, 8/31/00-5/15/08, with a value of $19,488,089 and U.S. Treasury Bonds, 5.25%-12%, 8/15/03-11/15/28, with a value of $6,884,261 (Cost $25,834,000) 25,834,000 25,834,000 - -------------------------------------------------------------------------------------------------------------------------------- Total Investments, at Value (Cost $489,506,155) 99.4% 573,478,960 - -------------------------------------------------------------------------------------------------------------------------------- Other Assets Net of Liabilities 0.6 3,196,596 ----------- ------------ Net Assets 100.0% $576,675,556 =========== ============
Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: AUD -- Australian Dollar CAD -- Canadian Dollar DKK -- Danish Krone GBP -- British Pound Sterling NZD -- New Zealand Dollar ZAR -- South African Rand 16 Oppenheimer Multiple Strategies Fund/VA Statement of Investments (Unaudited) (Continued) ================================================================================ 1. A sufficient amount of liquid assets has been designated to cover outstanding written call options, as follows:
Shares Expiration Exercise Premium Market Value Subject to Call Date Price Received Note 1 - ------------------------------------------------------------------------------------------------------------------------------- ACE, Ltd. 40,000 11/20/00 $ 30.000 $ 103,800 $ 100,000 ASM Lithography Holding NV 6,000 10/23/00 50.000 20,820 19,500 Abbott Laboratories 8,000 11/20/00 45.000 22,760 30,000 Aetna, Inc. 20,000 1/22/01 80.000 54,400 62,500 Affymetrix, Inc. 1,600 11/20/00 240.000 37,752 29,400 American Home Products Corp. 9,000 10/23/00 70.000 37,980 19,688 Analog Devices, Inc. 13,400 12/18/00 95.000 162,073 115,575 Brocade Communications Systems, Inc. 2,500 1/22/01 200.000 30,549 69,375 Callaway Golf Co. 27,000 11/20/00 22.500 40,521 8,433 Chase Manhattan Corp. 15,100 12/18/00 70.000 35,410 8,494 Cisco Systems, Inc. 6,600 1/22/01 85.000 23,727 19,388 Clear Channel Communications, Inc. 2,000 1/22/01 90.000 14,940 9,000 Coherent, Inc. 9,100 11/20/00 85.000 45,680 136,500 Computer Associates International, Inc. 10,000 11/20/00 80.000 20,325 10,000 Dana Corp. 4,000 1/22/01 35.000 6,630 1,250 General Motors Corp., Cl. H 3,700 9/18/00 41.625 11,914 2,544 Goodrich (B.F.) Co. 18,000 11/20/00 45.000 17,460 4,500 Human Genome Sciences, Inc. 3,200 10/23/00 160.000 43,104 66,000 Human Genome Sciences, Inc. 3,300 10/23/00 220.000 22,175 34,650 I2 Technologies, Inc. 3,600 11/20/00 210.000 26,891 18,000 Input/Output, Inc. 153,000 11/20/00 7.500 224,910 258,188 Intel Corp. 16,000 1/22/01 180.000 101,520 80,000 Intel Corp. 15,000 7/24/00 125.000 85,797 136,875 Intel Corp. 16,000 7/24/00 170.000 101,517 -- International Business Machines Corp. 24,000 7/24/00 150.000 83,280 -- International Game Technology 34,000 10/23/00 30.000 66,978 42,500 JDS Uniphase Corp. 6,000 12/18/00 140.000 56,070 108,750 Johnson & Johnson 9,000 1/22/01 115.000 23,355 32,625 Jones Apparel Group, Inc. 25,000 11/20/00 30.000 102,375 20,313 Kerr-McGee Corp. 10,000 7/24/00 65.000 23,450 5,000 Manor Care, Inc. 14,700 11/20/00 15.000 43,658 -- Merck & Co., Inc. 6,200 1/22/01 100.000 11,439 7,750 Methode Electronics, Inc., Cl. A 20,000 10/23/00 65.000 76,897 40,000 Mylan Laboratories, Inc. 15,000 7/24/00 30.000 34,236 -- Novell, Inc. 24,000 11/20/00 50.000 80,280 -- Research in Motion Ltd. 6,600 12/18/00 80.000 39,401 32,175 STMicroelectronics NV, NY Registered Shares 9,000 7/24/00 76.625 62,814 5,063 Santa Fe International Corp. 8,000 1/22/01 50.000 17,760 10,500 St. Jude Medical, Inc. 5,200 10/23/00 40.000 13,494 42,250 Teradyne, Inc. 2,100 10/23/00 105.000 40,362 9,713 Teradyne, Inc. 2,100 10/23/00 120.000 25,136 5,775 Time Warner, Inc. 6,400 9/18/00 100.000 15,807 6,400 Time Warner, Inc. 3,200 9/18/00 120.000 29,104 200 Toll Brothers, Inc. 4,800 12/18/00 20.000 17,856 14,400 Transocean Sedco Forex, Inc. 8,000 11/20/00 60.000 44,600 43,000 UnitedHealth Group, Inc. 16,000 12/18/00 80.000 166,348 230,000 Veritas Software Corp. 3,200 11/20/00 220.000 36,703 9,600 Viacom, Inc., Cl. B 16,500 7/24/00 65.000 75,818 182,655 Yahoo!, Inc. 600 1/22/01 270.000 3,132 1,725 Yahoo!, Inc. 600 10/23/00 270.000 12,882 338 ---------- ---------- $2,495,890 $2,090,592 ========== ==========
Oppenheimer Multiple Strategies Fund/VA 17 Statement of Investments (Unaudited) (Continued) ================================================================================ 2. Non-income-producing security. 3. Identifies issues considered to be illiquid or restricted--See Note 7 of Notes to Financial Statements. 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 $11,056,494 or 1.92% of the Fund's net assets as of June 30, 2000. 5. Units may be comprised of several components, such as debt and equity and/or warrants to purchase equity at some point in the future. For units which represent debt securities, principal amount disclosed represents total underlying principal. 6. For zero coupon bonds, the interest rate shown is the effective yield on the date of purchase. 7. A sufficient amount of securities has been designated to cover outstanding foreign currency contracts. See Note 5 of Notes to Financial Statements. 8. Represents the current interest rate for a variable or increasing rate security. 9. Denotes a step bond: a zero coupon bond that converts to a fixed or variable interest rate at a designated future date. 10. Issuer is in default. See accompanying Notes to Financial Statements. 18 Oppenheimer Multiple Strategies Fund/VA Statement of Assets and Liabilities June 30, 2000 (Unaudited) ================================================================================================== Assets Investments, at value (cost $489,506,155)--see accompanying statement $573,478,960 - -------------------------------------------------------------------------------------------------- Receivables and other assets: Interest 4,648,579 Investments sold 2,280,892 Shares of beneficial interest sold 452,960 Other 3,033 ------------ Total assets 580,864,424 ================================================================================================== Liabilities Bank overdraft 132,178 - -------------------------------------------------------------------------------------------------- Unrealized depreciation on foreign currency contracts 9,863 - -------------------------------------------------------------------------------------------------- Options written, at value (premiums received $2,495,890)--see accompanying statement 2,090,592 - -------------------------------------------------------------------------------------------------- Payables and other liabilities: Investments purchased 1,249,528 Shares of beneficial interest redeemed 686,735 Trustees' compensation 1,494 Transfer and shareholder servicing agent fees 182 Other 18,296 ------------ Total liabilities 4,188,868 ================================================================================================== Net Assets $576,675,556 ============ ================================================================================================== Composition of Net Assets Paid-in capital $457,313,267 - -------------------------------------------------------------------------------------------------- Undistributed net investment income 12,593,180 - -------------------------------------------------------------------------------------------------- Accumulated net realized gain on investments and foreign currency transactions 22,402,179 - -------------------------------------------------------------------------------------------------- Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies 84,366,930 ------------ Net assets--applicable to 34,768,274 shares of beneficial interest outstanding $576,675,556 ============ ================================================================================================== Net Asset Value, Redemption Price Per Share and Offering Price Per Share $16.59
See accompanying Notes to Financial Statements. Oppenheimer Multiple Strategies Fund/VA 19 Statement of Operations For the Six Months Ended June 30, 2000 (Unaudited) ======================================================================================== Investment Income Interest (net of foreign withholding taxes of $1,342) $12,068,590 - ---------------------------------------------------------------------------------------- Dividends (net of foreign withholding taxes of $33,414) 3,018,210 ----------- Total income 15,086,800 ======================================================================================== Expenses Management fees 2,058,748 - ---------------------------------------------------------------------------------------- Custodian fees and expenses 33,671 - ---------------------------------------------------------------------------------------- Trustees' compensation 3,634 - ---------------------------------------------------------------------------------------- Transfer and shareholder servicing agent fees 1,048 - ---------------------------------------------------------------------------------------- Other 44,461 ----------- Total expenses 2,141,562 Less expenses paid indirectly (6,626) ----------- Net expenses 2,134,936 ======================================================================================== Net Investment Income 12,951,864 ======================================================================================== Realized and Unrealized Gain (Loss) Net realized gain (loss) on: Investments (including premiums on options exercised) 25,517,364 Closing and expiration of option contracts written 601,180 Foreign currency transactions (1,998,654) ----------- Net realized gain 24,119,890 - ---------------------------------------------------------------------------------------- Net change in unrealized appreciation (depreciation) on: Investments 2,884,554 Translation of assets and liabilities denominated in foreign currencies (3,169,342) ----------- Net change (284,788) ----------- Net realized and unrealized gain 23,835,102 ======================================================================================== Net Increase in Net Assets Resulting from Operations $36,786,966 ===========
See accompanying Notes to Financial Statements. 20 Oppenheimer Multiple Strategies Fund/VA Statements of Changes in Net Assets
Six Months Ended Year Ended June 30, 2000 December 31, (Unaudited) 1999 ============================================================================================ Operations Net investment income $ 12,951,864 $ 26,455,258 - -------------------------------------------------------------------------------------------- Net realized gain 24,119,890 36,392,711 - -------------------------------------------------------------------------------------------- Net change in unrealized appreciation (depreciation) (284,788) 3,140,414 ------------ ------------ Net increase in net assets resulting from operations 36,786,966 65,988,383 ============================================================================================ Dividends and/or Distributions to Shareholders Dividends from net investment income (26,143,340) (20,765,472) - -------------------------------------------------------------------------------------------- Distributions from net realized gain (37,970,659) (30,037,334) ============================================================================================ Beneficial Interest Transactions Net increase (decrease) in net assets resulting from beneficial interest transactions 25,219,755 (58,736,044) ============================================================================================ Net Assets Total decrease (2,107,278) (43,550,467) - -------------------------------------------------------------------------------------------- Beginning of period 578,782,834 622,333,301 ------------ ------------ End of period (including undistributed net investment income of $12,593,180 and $25,784,656, respectively) $576,675,556 $578,782,834 ============ ============
See accompanying Notes to Financial Statements. Oppenheimer Multiple Strategies Fund/VA 21 Financial Highlights
Six Months Ended June 30, Year Ended December 31, 2000 (Unaudited) 1999 1998 1997 1996 1995 ============================================================================================================================== Per Share Operating Data Net asset value, beginning of period $17.46 $17.05 $17.01 $15.63 $14.55 $12.91 - ------------------------------------------------------------------------------------------------------------------------------ Income from investment operations: Net investment income .40 .82 .71 .62 .72 .66 Net realized and unrealized gain .74 1.04 .42 1.95 1.45 2.00 - ------------------------------------------------------------------------------------------------------------------------------ Total income from investment operations 1.14 1.86 1.13 2.57 2.17 2.66 - ------------------------------------------------------------------------------------------------------------------------------ Dividends and/or distributions to shareholders: Dividends from net investment income (.82) (.59) (.16) (.61) (.74) (.65) Distributions from net realized gain (1.19) (.86) (.93) (.58) (.35) (.37) - ------------------------------------------------------------------------------------------------------------------------------ Total dividends and/or distributions to shareholders (2.01) (1.45) (1.09) (1.19) (1.09) (1.02) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period $16.59 $17.46 $17.05 $17.01 $15.63 $14.55 ====== ====== ====== ====== ====== ====== ============================================================================================================================== Total Return, at Net Asset Value(1) 6.70% 11.80% 6.66% 17.22% 15.50% 21.36% ============================================================================================================================== Ratios/Supplemental Data Net assets, end of period (in thousands) $576,676 $578,783 $622,333 $637,545 $484,285 $381,263 - ------------------------------------------------------------------------------------------------------------------------------ Average net assets (in thousands) $573,917 $593,151 $640,131 $564,369 $428,277 $344,745 - ------------------------------------------------------------------------------------------------------------------------------ Ratios to average net assets:(2) Net investment income 4.54% 4.46% 4.05% 3.86% 4.89% 4.81% Expenses 0.75% 0.73% 0.76%(3) 0.75%(3) 0.77%(3) 0.77%(3) - ------------------------------------------------------------------------------------------------------------------------------ Portfolio turnover rate 17% 17% 43% 42% 40% 39%
1. Assumes a $1,000 hypothetical initial investment on the business day before the first day of the fiscal period with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Total returns are not annualized for periods of less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. 2. Annualized for periods of less than one full year. 3. Expense ratio has not been grossed up to reflect the effect of expenses paid indirectly. See accompanying Notes to Financial Statements. 22 Oppenheimer Multiple Strategies Fund/VA Notes to Financial Statements (Unaudited) ================================================================================ 1. Significant Accounting Policies Oppenheimer Multiple Strategies Fund/VA (the Fund) is a separate series of Oppenheimer Variable Account Funds (the Trust), an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund's investment objective is to seek a high total investment return, which includes current income and capital appreciation in the value of its shares. The Trust's investment advisor is OppenheimerFunds, Inc. (the Manager). The following is a summary of significant accounting policies consistently followed by the Fund. - -------------------------------------------------------------------------------- Securities Valuation. Securities listed or traded on National Stock Exchanges or other domestic or foreign exchanges are valued based on the last sale price of the security traded on that exchange prior to the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the closing bid and asked prices, and if not, at the closing bid price. Securities (including restricted securities) for which quotations are not readily available are valued primarily using dealer-supplied valuations, a portfolio pricing service authorized by the Board of Trustees, or at their fair value. Fair value is determined in good faith under consistently applied procedures under the supervision of the Board of Trustees. Short-term "money market type" debt securities with remaining maturities of sixty days or less are valued at amortized cost (which approximates market value.) - -------------------------------------------------------------------------------- Security Credit Risk. The Fund invests in high yield securities, which may be subject to a greater degree of credit risk, greater market fluctuations and risk of loss of income and principal, and may be more sensitive to economic conditions than lower yielding, higher rated fixed income securities. The Fund may acquire securities in default, and is not obligated to dispose of securities whose issuers subsequently default. As of June 30, 2000, securities with an aggregate market value of $70,000, representing 0.01% of the Fund's net assets, were in default. - -------------------------------------------------------------------------------- Foreign Currency Translation. The accounting records of the Fund are maintained in U.S. dollars. Prices of securities denominated in foreign currencies are translated into U.S. dollars at the closing rates of exchange. Amounts related to the purchase and sale of foreign securities and investment income are translated at the rates of exchange prevailing on the respective dates of such transactions. 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. - -------------------------------------------------------------------------------- Repurchase Agreements. The Fund requires the custodian to take possession, to have legally segregated in the Federal Reserve Book Entry System or to have segregated within the custodian's vault, all securities held as collateral for repurchase agreements. The market value of the underlying securities is required to be at least 102% of the resale price at the time of purchase. If the seller of the agreement defaults and the value of the collateral declines, or if the seller enters an insolvency proceeding, realization of the value of the collateral by the Fund may be delayed or limited. - -------------------------------------------------------------------------------- Federal Taxes. The Fund intends to continue to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income, including any net realized gain on investments not offset by loss carryovers to shareholders. - -------------------------------------------------------------------------------- Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations, are recorded on the ex-dividend date. Oppenheimer Multiple Strategies Fund/VA 23 Notes to Financial Statements (Unaudited) (Continued) ================================================================================ 1. Significant Accounting Policies (continued) Classification of Dividends and Distributions to Shareholders. Net investment income (loss) and net realized gain (loss) may differ for financial statement and tax purposes primarily because of the recognition of certain foreign currency gains (losses) as ordinary income (loss) for tax purposes. The character of dividends and distributions made during the fiscal year from net investment income or net realized gains may differ from its 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 realized gain was recorded by the Fund. - -------------------------------------------------------------------------------- Expense Offset Arrangements. Expenses paid indirectly represent a reduction of custodian fees for earnings on cash balances maintained by the Fund. - -------------------------------------------------------------------------------- Other. Investment transactions are accounted for as of trade date and dividend income is recorded on the ex-dividend date. Realized gains and losses on investments and options written and unrealized appreciation and depreciation are determined on an identified cost basis, which is the same basis used for federal income tax purposes. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. ================================================================================ 2. Shares of Beneficial Interest The Fund has authorized an unlimited number of no par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:
Six Months Ended June 30, 2000 Year Ended December 31, 1999 ---------------------------------- ------------------------------ Shares Amount Shares Amount - ----------------------------------------------------------------------------------------------------------------------------- Sold 1,613,010 $ 27,215,330 1,494,012 $ 25,019,610 Dividends and/or distributions reinvested 3,923,745 64,113,998 3,209,274 50,802,806 Redeemed (3,916,871) (66,109,573) (8,052,445) (134,558,460) ---------- ------------ ---------- ------------- Net increase (decrease) 1,619,884 $ 25,219,755 (3,349,159) $ (58,736,044) ========== ============ ========== =============
================================================================================ 3. Purchases and Sales of Securities The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations, for the six months ended June 30, 2000, were $90,301,519 and $108,977,854, respectively. ================================================================================ 4. Fees and Other Transactions with Affiliates Management Fees. Management fees paid to the Manager were in accordance with the investment advisory agreement with the Trust. The annual fees are 0.75% of the first $200 million of average annual net assets, 0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the next $200 million and 0.60% of average annual net assets over $800 million. The Fund's management fee for the six months ended June 30, 2000 was an annualized rate of 0.72%, before any waiver by the Manager. - -------------------------------------------------------------------------------- Transfer Agent Fees. OppenheimerFunds Services (OFS), a division of the Manager, is the transfer agent for the Fund and is responsible for maintaining the shareholder registry and shareholder accounting records for the Fund. OFS provides these services for cost. 24 Oppenheimer Multiple Strategies Fund/VA Notes to Financial Statements (Unaudited) (Continued) ================================================================================ 5. Foreign Currency Contracts A foreign currency contract is a commitment to purchase or sell a foreign currency at a future date, at a negotiated rate. The Fund may enter into foreign currency contracts for operational purposes and to seek to protect against adverse exchange rate fluctuations. Risks to the Fund include the potential inability of the counterparty to meet the terms of the contract. The net U.S. dollar value of foreign currency underlying all contractual commitments held by the Fund and the resulting unrealized appreciation or depreciation are determined using foreign currency exchange rates as provided by a reliable bank, dealer or pricing service. Unrealized appreciation and depreciation on foreign currency contracts are reported in the Statement of Assets and Liabilities. The Fund may realize a gain or loss upon the closing or settlement of the foreign currency transactions. Realized gains and losses are reported with all other foreign currency gains and losses in the Statement of Operations. Securities denominated in foreign currency to cover net exposure on outstanding foreign currency contracts are noted in the Statement of Investments where applicable. As of June 30, 2000, the Fund had outstanding foreign currency contracts as follows:
Expiration Contract Valuation as of Unrealized Contract Description Date Amounts (000s) June 30, 2000 Depreciation - ------------------------------------------------------------------------------------------------- Contracts to Purchase Canadian Dollar (CAD) 7/4/00 240 CAD $ 162,074 $ 103 ------ Contracts to Sell Swedish Krona (SEK) 7/4/00 15,582 SEK 1,777,172 9,760 ------ Total Unrealized Depreciation $9,863 ======
================================================================================ 6. Option Activity The Fund may buy and sell put and call options, or write put and covered call options on portfolio securities in order to produce incremental earnings or protect against changes in the value of portfolio securities. The Fund generally purchases put options or writes covered call options to hedge against adverse movements in the value of portfolio holdings. When an option is written, the Fund receives a premium and becomes obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. Options are valued daily based upon the last sale price on the principal exchange on which the option is traded and unrealized appreciation or depreciation is recorded. The Fund will realize a gain or loss upon the expiration or closing of the option transaction. When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option is adjusted by the amount of premium received or paid. Securities designated to cover outstanding call options are noted in the Statement of Investments where applicable. Shares subject to call, expiration date, exercise price, premium received and market value are detailed in a note to the Statement of Investments. Options written are reported as a liability in the Statement of Assets and Liabilities. Realized gains and losses are reported in the Statement of Operations. The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk of not being able to enter into a closing transaction if a liquid secondary market does not exist. Oppenheimer Multiple Strategies Fund/VA 25 Notes to Financial Statements (Unaudited) (Continued) ================================================================================ 6. Option Activity (continued) Written option activity for the six months ended June 30, 2000, was as follows:
Call Options ---------------------------------- Number of Amount of Options Premiums - ------------------------------------------------------------------------------------ Options outstanding as of December 31, 1999 2,352 $ 1,252,165 Options written 7,665 2,977,794 Options closed or expired (2,383) (1,161,410) Options exercised (771) (572,659) ------ ----------- Options outstanding as of June 30, 2000 6,863 $ 2,495,890 ====== ===========
================================================================================ 7. Illiquid or Restricted Securities As of June 30, 2000, investments in securities included issues that are illiquid or restricted. Restricted securities are often purchased in private placement transactions, are not registered under the Securities Act of 1933, may have contractual restrictions on resale, and are valued under methods approved by the Board of Trustees as reflecting fair value. A security may also be considered illiquid if it lacks a readily available market or if its valuation has not changed for a certain period of time. The Fund intends to invest no more than 15% of its net assets (determined at the time of purchase and reviewed periodically) in illiquid or restricted securities. Certain restricted securities, eligible for resale to qualified institutional investors, are not subject to that limitation. The aggregate value of illiquid or restricted securities subject to this limitation as of June 30, 2000, was $14,221,527, which represents 2.47% of the Fund's net assets, of which $5,681, is considered restricted. Information concerning restricted securities is as follows:
Valuation Per Acquisition Cost Per Unit as of Security Dates Unit June 30, 2000 - ---------------------------------------------------------------------------------------------- Intermedia Communications, Inc. 9/29/98-12/29/98 $12.58-$21.69 $28.26
26 Oppenheimer Multiple Strategies Fund/VA Oppenheimer Multiple Strategies Fund/VA A Series of Oppenheimer Variable Account Funds ==================================================================================================================================== Officers and Trustees James C. Swain, Trustee and Chairman of the Board Bridget A. Macaskill, Trustee and President William L. Armstrong, Trustee Robert G. Avis, Trustee William A. Baker, Trustee George C. Bowen, Trustee Edward L. Cameron, Trustee Jon S. Fossel, Trustee Sam Freedman, Trustee Raymond J. Kalinowski, Trustee C. Howard Kast, Trustee Robert M. Kirchner, Trustee Ned M. Steel, Trustee John P. Doney, Vice President Michael S. Levine, Vice President Richard H. Rubinstein, Vice President Andrew J. Donohue, Vice President and Secretary Brian W. Wixted, Treasurer Robert J. Bishop, Assistant Treasurer Scott T. Farrar, Assistant Treasurer Robert G. Zack, Assistant Secretary ==================================================================================================================================== Investment Advisor OppenheimerFunds, Inc. ==================================================================================================================================== Transfer Agent OppenheimerFunds Services ==================================================================================================================================== Custodian of Portfolio Securities The Bank of New York ==================================================================================================================================== Independent Auditors Deloitte & Touche LLP ==================================================================================================================================== Legal Counsel Myer, Swanson, Adams & Wolf, P.C. The financial statements included herein have been taken from the records of the Fund without examination of those records by the independent auditors. This is a copy of a report to shareholders of Oppenheimer Multiple Strategies Fund/VA. For other material information concerning the Fund, see its prospectus. This report must be preceded or accompanied by the Fund's prospectus, the separate account prospectus, and current standardized average annual total returns for the separate account being offered. 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.
(C)Copyright 2000 OppenheimerFunds, Inc. All rights reserved. Oppenheimer Multiple Strategies Fund/VA 27 -----END PRIVACY-ENHANCED MESSAGE-----