Oppenheimer

    Main Street^® Growth &
    Income Fund/VA


 A Series of Oppenheimer Variable Account Founds

Oppenheimer Variable Account Funds—Oppenheimer Main Street^® Growth & Income Fund/VA

Objective
Oppenheimer Main Street Growth & Income Fund/VA, one of a series of Oppenheimer Variable Account Funds, seeks high total return, which includes growth in the value of its shares, as well as current income from equity and debt securities.

Narrative by Charles Albers and Nikolaos Monoyios, Co-Portfolio Managers
Oppenheimer Main Street Growth & Income Fund/VA for the 12-month reporting period that ended December 31, 2000, provided a -8.78% annual total return.¹ This compares relatively favorably with the -9.10% annual total return provided by the Standard & Poor’s 500 Index, a popular measure of large-capitalization stock performance.
       We believe that the Fund performed as we might expect in a very difficult environment for U.S. stocks. Our investment approach, which combines state-of-the-art quantitative analysis with seasoned professional judgment, helped the Fund exceed the returns of the S&P 500 Index while significantly cushioning some of the market’s heightened volatility over the past fiscal year.
       When the 12-month period began on January 1, 2000, many investors had achieved short-term success by investing in stocks with plenty of forward momentum-often regardless of their earnings, valuations and other business fundamentals. As a result, many technology and Internet stocks reached lofty levels because of unrestrained investor enthusiasm. In March and April 2000, however, momentum investing suddenly fell out of favor when fundamental business considerations raised concerns that valuations had risen too far, too fast. As a result, prices of formerly high-flying Internet stocks began to decline to more reasonable valuations.
       At the start of the year, our models indicated that technology stock valuations were unsustainably high. Accordingly, we had reduced the Fund’s technology holdings to a percentage that was considerably less than the sector’s representation in the S&P 500 Index. Although this shift caused the Fund to miss some of the technology group’s advance in early 2000, it positioned the Fund to avoid the brunt of the sector’s downturn in March and April. In fact, as technology stock prices fell, we took advantage of the opportunity to increase the Fund’s holdings among the sector’s larger, better-established companies, raising its exposure to technology stocks to a level that was slightly greater than their representation in the S&P 500 Index. This greater level of exposure helped during the summer, when technology stocks rallied, but hurt performance toward the end of the year, when they once again declined.²
       Subsequent to the spring correction in the technology sector, investor sentiment had begun shifting to a preference for value-oriented stocks.
       Indeed, signs that U.S. economic growth might be slowing in response to the Fed’s previous interest-rate hikes sharpened investors’ focus on reasonably priced stocks with strong business fundamentals. A number of industry groups participated in this rally, including energy, healthcare and financial services.
       In these sectors, our quantitative models led us to individual stocks that, on average, provided relatively attractive returns. In the energy area, for example, the Fund received good performance from offshore drillers, major integrated oil companies and North American natural gas producers. All of these businesses benefited from rising energy prices over the past year.
       On the other hand, while the Fund’s financial services holdings benefited from the economic slow-down later in the reporting period, the Fund held relatively few financial stocks relative to the benchmark. Similarly, while the Fund’s healthcare holdings performed quite well, these did not contribute substantially to overall performance because of the Fund’s relatively light exposure to the group.

Because the stock market can be volatile, the Fund’s performance may be subject to substantial short-term changes.

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 would have been lower if such charges were taken into account.

2. The Fund’s portfolio is subject to change.

Oppenheimer Variable Account Funds—Oppenheimer Main Street^® Growth & Income Fund/VA

Other strategic changes suggested by our statistical models early in the period included a gradual shift toward the higher end of the large-capitalization range. Later in the period, however, we began to move toward the lower end of that range. We made this change beginning in October because our models indicated potential weakness in the largest “mega-cap” stocks and better prospects for large- and mid-cap companies. Similarly anticipating the shift in investor sentiment, our models indicated better prospects for value than growth stocks during most of the year.
       Looking forward, the investment environment remains uncertain. In our view, the stock market’s future performance largely depends on the behavior of the U.S. economy and the Fed’s monetary policies. If the economy enters a recession, stock prices could decline further. If, however, the economy achieves a “soft landing” in which growth slows but remains positive, the stock market is likely to rise in the long term, in our view.
       Regardless of which direction the economy moves, we intend to continue to employ and refine our quantitative models. Indeed, we strive to continually improve our investment process. Our models are currently telling us that large-cap and mid-cap stocks are likely to outperform mega-caps, and that maintaining a balance between growth and value may be the best way to weather market volatility and participate in areas of market strength. In our opinion, combining our models with our many years of portfolio management experience is an important part of what makes OppenheimerFunds The Right Way to Invest.

Management’s discussion of performance. During the fiscal year that ended December 31, 2000, Oppenheimer Main Street Growth & Income Fund/VA’s performance was strongly influenced by the reaction of its statistical models to changes in economic and market conditions, as well as shifts in investor sentiment. While growth stocks generally dominated the market in the first few months of the year, value-oriented stocks, including the energy group, drove the market and Fund’s returns during the remainder of the period. The Fund’s investments in technology stocks, which were an area of emphasis for parts of the reporting period, generally detracted from performance when the technology industry group declined in the spring and again in the fall. The Fund’s portfolio holdings, allocations and investment style are subject to change.

Oppenheimer Variable Account Funds—Oppenheimer Main Street^® Growth & Income Fund/VA

Comparing the Fund’s performance to the market. The graph that follows shows the performance of a hypothetical $10,000 investment in the Fund.¹ Performance information does not reflect charges that apply to separate accounts investing in the Fund. If these charges were taken into account, performance would be lower. The graph assumes that all dividends and capital gains distributions were reinvested in additional shares.
       The Fund’s performance is compared to the performance of the S&P 500 Index, a broad-based index of equity securities widely regarded as a general measure of the performance of the U.S. equity securities market. Index performance reflects the reinvestment of income but does not consider the effect of transaction costs. The Fund’s performance reflects the effects of the Fund’s business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund’s performance, it must be noted that the Fund’s investments are not limited to the investments in the index.

Because of ongoing market volatility, the Fund’s performance has been subject to substantial short-term fluctuations and current performance may be less than the results shown. For updates on the Fund’s performance, please call us at 1.800.981.2871.
The performance information in the graph for the S&P 500 Index begins on 6/30/95. The inception date of the Fund was 7/5/95.
Total returns and the ending account value in the graph show change in share value and include reinvestment of all dividends and capital gains distributions.
Past performance is not predictive of future performance.
1. Performance is not shown for the Fund’s Service Class shares, which were outstanding during less than half of this fiscal year.
2. The cumulative total return of Service Class shares of the Fund (not annualized) from inception on 7/13/00 to 12/31/00 was –11.61%.

Statement of Investments  December 31, 2000
		Market Value
	Shares	See Note 1
Common Stocks-95.0%
Basic Materials-1.4%
Chemicals-0.6%
Air Products & Chemicals, Inc.	12,000	$ 492,000
Dow Chemical Co.	15,200	556,700
Du Pont (E.I.) de Nemours & Co.	71,500	3,454,344
Ecolab, Inc.	6,900	297,994
Engelhard Corp.	6,300	128,362
Union Carbide Corp.	20,500	1,103,156
Universal Corp.	3,500	122,500
		6,155,056
Metals-0.5% AK Steel Holding Corp.	16,700	146,125
Alcan Aluminium Ltd.	8,800	300,850
Alcoa, Inc.	107,800	3,611,300
Carpenter Technology Corp.	4,300	150,500
Inco Ltd.(1)	37,900	635,204
Reliance Steel & Aluminum Co.	7,500	185,625 5,029,604
Paper-0.3% Pactiv Corp.(1)	22,800	282,150
Rayonier, Inc.	8,000	318,500
Westvaco Corp.	7,000	204,312
Weyerhaeuser Co.	36,300	1,842,225 2,647,187
Capital Goods-8.9%
Aerospace/Defense-1.0% Boeing Co.	125,800	8,302,800
General Dynamics Corp.	12,000	936,000
Lockheed Martin Corp.	15,000	509,250 9,748,050
Electrical Equipment-4.3% Amphenol Corp., Cl. A(1)	4,800	188,100
AVX Corp.	68,900	1,128,237
Emerson Electric Co.	40,400	3,184,025
General Electric Co.	681,300	32,659,819
Integrated Device Technology, Inc.(1)	34,100	1,129,562
Kemet Corp.(1)	11,600	175,450
Molex, Inc., Cl. A	38,150	970,441
Powerwave Technologies, Inc.(1)	9,400	549,900
Rockwell International Corp.	25,600	1,219,200
SPX Corp.(1)	9,200	995,325
Symbol Technologies, Inc.	7,925	285,300
Technitrol, Inc.	2,900	119,262
Vishay Intertechnology, Inc.(1)	53,600	810,700 43,415,321

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Industrial Services-0.2%
Forrester Research, Inc.(1)	7,400	$ 370,462
Miller (Herman), Inc.	18,300	526,125
Quanta Services, Inc.(1)	8,500	273,594
Robert Half International, Inc.(1)	15,400	408,100
Waste Connections, Inc.(1)	6,000	198,375 1,776,656
Manufacturing-3.4% American Standard Cos., Inc.(1)	75,000	3,698,437
Avery-Dennison Corp.	36,400	1,997,450
Ball Corp.	2,300	105,944
Bemis Co., Inc.	9,000	302,062
Cooper Industries, Inc.	13,900	638,531
Corning, Inc.	40,300	2,128,344
Deere & Co.	13,200	604,725
Dover Corp.	53,400	2,166,037
Honeywell International, Inc.	40,475	1,914,973
Illinois Tool Works, Inc.	17,800	1,060,212
Jabil Circuit, Inc.(1)	20,000	507,500
Mettler-Toledo International, Inc.(1)	6,000	326,250
Microchip Technology, Inc.(1)	12,050	264,347
Millipore Corp.	2,600	163,800
Minnesota Mining & Manufacturing Co.	31,900	3,843,950
Parker-Hannifin Corp.	7,600	335,350
Plexus Corp.(1)	9,000	273,516
Sanmina Corp.(1)	11,300	865,862
Solectron Corp.(1)	11,000	372,900
Tektronix, Inc.	35,200	1,185,800
Tyco International Ltd.	191,966	10,654,113
United Technologies Corp.	14,500	1,140,062 34,550,165
Communication Services-4.2%
Telecommunications: Long Distance-2.5% AT&T Corp.	397,800	6,886,912
Broadcom Corp., Cl. A(1)	14,900	1,251,600
BroadWing, Inc.	13,600	310,250
Brocade Communications Systems, Inc.(1)	17,600	1,615,900
Comverse Technology, Inc.(1)	6,200	673,475
Efficient Networks, Inc.(1)	6,500	92,625
Exodus Communications, Inc.(1)	18,900	378,000
Intermedia Communications, Inc.(1)(2)	1,230	8,399
Qwest Communications International, Inc.(1)	143,600	5,887,600
Sprint Corp. (Fon Group)	47,000	954,687
Telephone & Data Systems, Inc.	900	81,000
Time Warner Telecom, Inc., Cl. A(1)	4,000	253,750

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Telecommunications: Long Distance (continued) Tollgrade Communications, Inc.(1)	4,900	$ 178,850
Verizon Communications	105,056	5,265,932
WorldCom, Inc.(1)	135,000	< u>  1,898,437 25,737,417
Telephone Utilities-1.5% BellSouth Corp.	183,800	7,524,312
SBC Communications, Inc.	160,500	7,663,875 15,188,187
Telecommunications: Wireless-0.2% Amdocs Ltd.(1)	27,000	1,788,750
AT&T Wireless Group	37,800	654,412 2,443,162
Consumer Cyclicals-6.9%
Autos & Housing-0.8% Bandag, Inc.	2,000	81,125
Centex Construction Products, Inc.	3,000	81,937
Delphi Automotive Systems Corp.	46,131	518,974
Ford Motor Co.	123,815	2,901,914
Fortune Brands, Inc.	6,700	201,000
General Motors Corp.	27,600	1,405,875
Johnson Controls, Inc.	6,700	348,400
Lafarge Corp.	8,100	191,362
Lear Corp.(1)	20,700	513,61 9
NVR, Inc.(1)	7,000	865,200
Ryland Group, Inc. (The)	10,500	427,875
Toll Brothers, Inc.(1)	10,000	408,750
Vulcan Materials Co.	5,000	239,375
Webb (Del E.) Corp.(1)	4,300	125,775 8,311,181
Consumer Services-0.2% Avis Group Holdings, Inc., Cl. A(1)	18,000	586,125
Dun & Bradstreet Corp.(1)	6,000	155,250
Moody’s Corp.	12,000	308,250
Omnicom Group, Inc.	9,900	820,462
TMP Worldwide, Inc.(1)	2,800	154,000
Vivendi Universal SA, Sponsored ADR(1)	3,280	214,225 2,238,312
Leisure & Entertainment-0.5% Brunswick Corp.	49,800	818,587
Harley-Davidson, Inc.	18,200	723,450
Marriott International, Inc., Cl. A	13,500	570,375
MGM Mirage, Inc.	30,648	863,890
Park Place Entertainment Corp.(1)	105,000	1,253,437
Starwood Hotels & Resorts Worldwide, Inc.	16,700	588,675 4,818,414

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Media-1.7% Deluxe Corp.	2,200	$ 55,594
Dow Jones & Co., Inc.	15,400	872,025
Gannett Co., Inc.	46,200	2,913,487
Harland (John H.) Co.	10,000	141,250
Harte-Hanks, Inc.	11,000	260,562
Havas Advertising SA, ADR(1)	6,855	96,827
Interpublic Group of Cos., Inc.	23,700	1,008,731
Knight-Ridder, Inc.	14,800	841,750
McGraw-Hill, Inc.	15,400	902,825
New York Times Co., Cl. A	44,000	1,762,750
R.H. Donnelley Corp.(1)	11,200	272,300
Readers Digest Assn., Inc. (The), Cl. A	52,700	2,061,887
Time Warner, Inc.	73,320	3,830,237
Tribune Co.	12,000	507,000
USA Networks, Inc.(1)	70,000	1,360,625 16,887,850
Retail: General-2.0% Kohl’s Corp.(1)	22,300	1,360,300
May Department Stores Co.	32,300	1,057,825
Sears Roebuck & Co.	54,300	1,886,925
Wal-Mart Stores, Inc.	303,300	16,112,812 20,417,862
Retail: Specialty-1.3% Ann Taylor Stores Corp.(1)	13,900	346,631
Best Buy Co., Inc.(1)	46,700	1,380,569
BJ’s Wholesale Club, Inc.(1)	10,800	414,450
CDW Computer Centers, Inc.(1)	4,500	125,437
Home Depot, Inc.	134,000	6,122,125
Insight Enterprises, Inc.(1)	10,425	186,998
Intimate Brands, Inc., Cl. A	6,400	96,000
Limited, Inc. (The)	114,800	1,958,775
Payless ShoeSource, Inc.(1)	650	45,987
RadioShack Corp.	5,600	239,750
Ross Stores, Inc.	34,700	585,562
Tiffany & Co.	33,800	1,068,925
Zale Corp.(1)	31,900	927,094 13,498,303

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Textile/Apparel & Home Furnishings-0.4% Jones Apparel Group, Inc.(1)	106,299	$ 3,421,499
Linens ’N Things, Inc.	5,000	138,125
Liz Claiborne, Inc.	16,700	695,137
Mohawk Industries, Inc.(1)	6,300	172,462
Shaw Industries, Inc.	3,200	60,600
Too, Inc.(1)	8,157	101,962 4,589,785
Consumer Staples-6.3%
Beverages-1.6% Anheuser-Busch Cos., Inc.	123,000	5,596,500
Coca-Cola Co. (The)	85,900	5,234,531
Constellation Brands, Inc., Cl. A(1)	2,700	158,625
PepsiCo, Inc.	107,800	5,342,837 16,332,493
Broadcasting-0.4% AT&T Corp./Liberty Media Corp., Cl. A(1)	181,400	2,460,237
Comcast Corp., Cl. A Special(1)	18,700	780,725
Gemstar-TV Guide International, Inc.(1)	22,000	1,014,750
ValueVision International, Inc., Cl. A(1)	2,900	36,612 4,292,324
Entertainment-1.3% Brinker International, Inc.(1)	18,000	760,500
Darden Restaurants, Inc.	28,800	658,800
Disney (Walt) Co.	164,600	4,763,112
P.F. Chang’s China Bistro, Inc.(1)	7,100	223,206
Ruby Tuesday, Inc.	38,400	585,600
Ryan’s Family Steak Houses, Inc.(1)	5,900	55,681
Viacom, Inc., Cl. B(1)	130,030	6,078,902
Wendy’s International, Inc.	14,000	367,500 13,493,301
Food-0.6% Agribrands International, Inc.(1)	7,900	422,650
ConAgra Foods, Inc.	54,200	1,409,200
Heinz (H.J.) Co.	28,800	1,366,200
Keebler Foods Co.	1,400	58,012
Ralston Purina Co.	12,000	313,500
Sysco Corp.	92,000	2,760,000 6,329,562

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Food & Drug Retailers-0.6% Kroger Co.(1)	58,000	$ 1,569,625
Safeway, Inc.(1)	28,800	1,800,000
Walgreen Co.	61,000	2,550,562 5,920,187
Household Goods-0.6% Avon Products, Inc.	21,000	1,005,375
Clorox Co. (The)	10,000	355,000
Colgate-Palmolive Co.	24,600	1,587,930
Energizer Holdings, Inc.(1)	5,400	115,425
Kimberly-Clark Corp.	49,400	3,492,086 6,555,816
Tobacco-1.2% Philip Morris Cos., Inc.	180,300	7,933,200
R.J. Reynolds Tobacco Holdings, Inc.	89,300	4,353,375 12,286,575
Energy-16.7%
Energy Services-4.6% Baker Hughes, Inc.	23,300	968,406
BJ Services Co.(1)	16,400	1,129,550
Coastal Corp.	13,700	1,209,881
Cooper Cameron Corp.(1)	60,000	3,963,750
ENSCO International, Inc.	246,200	8,386,187
Exelon Corp.	77,324	5,428,918
Global Marine, Inc.(1)	206,700	5,865,112
Halliburton Co.	18,500	670,625
Nabors Industries, Inc.(1)	60,000	3,549,000
Noble Drilling Corp.(1)	91,900	3,991,906
R&B Falcon Corp.(1)	43,700	1,002,369
Santa Fe International Corp.	84,000	2,693,250
Schlumberger Ltd.	57,400	4,588,412
Smith International, Inc.(1)	16,600	1,237,737
Stolt Offshore SA, ADR(1)	177,300	1,905,975 46,591,078
Oil: Domestic-8.2% Amerada Hess Corp.	29,300	2,140,731
Apache Corp.	50,300	3,524,144
Brown (Tom), Inc.(1)	113,100	3,718,162
Cabot Oil & Gas Corp., Cl. A	21,000	654,937
Chevron Corp.	108,200	9,136,137

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Oil: Domestic (continued) Chieftain International, Inc.(1)	86,100	$ 2,378,512
Conoco, Inc., Cl. A	19,200	549,600
Conoco, Inc., Cl. B	24,500	708,969
Devon Energy Corp.	66,200	4,036,214
EOG Resources, Inc.	102,900	5,627,344
Exxon Mobil Corp.	292,108	25,395,139
Frontier Oil Corp.(1)	105,200	723,250
Kerr-McGee Corp.	44,100	2,951,944
Murphy Oil Corp.	66,500	4,019,094
Newfield Exploration Co.(1)	39,700	1,883,269
Noble Affiliates, Inc.	24,000	1,104,000
Occidental Petroleum Corp.	52,000	1,261,000
Phillips Petroleum Co.	42,300	2,405,813
St. Mary Land & Exploration Co.	25,400	846,138
Stone Energy Corp.(1)	33,800	2,181,790
Tesoro Petroleum Corp.(1)	29,000	337,125
Texaco, Inc.	82,700	5,137,738
Tosco Corp.	40,800	1,384,650
USX-Marathon Group	4,000	111,000
Valero Energy Corp.	12,900	479,719 82,696,419
Oil: International-3.9% Anderson Exploration Ltd.(1)	202,679	4,594,687
Berkley Petroleum Corp.(1)	255,200	1,919,947
Canadian 88 Energy Corp.	580,000	1,552,330
Canadian Hunter Exploration Ltd.	24,400	667,670
Canadian Hunter Exploration Ltd.	78,500	2,148,036
Canadian Natural Resources Ltd.(1)	158,384	4,376,123
Encal Energy Ltd.(1)	121,900	864,338
Genesis Exploration Ltd.	334,000	2,757,390
Genoil, Inc.(1)	205,733	—
Husky Energy, Inc.(1)	59,429	589,542
Paramount Resources Ltd.	94,900	1,080,419
Precision Drilling Corp.(1)	7,000	262,938
Rio Alto Exploration Ltd.(1)	88,350	1,917,583
Royal Dutch Petroleum Co., NY Shares	185,100	11,210,119
Talisman Energy, Inc.(1)	128,000	4,742,477
Varco International, Inc.(1)	26,000	565,500 39,249,099

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Financial-14.9%
Banks-3.7%
Bank of America Corp.	132,100	$ 6,060,088
Bank of New York Co., Inc. (The)	20,200	1,114,788
BB&T Corp.	14,700	548,494
Chase Manhattan Corp.	89,900	4,084,831
Comerica, Inc.	4,000	237,500
First Union Corp.	47,100	1,309,969
Firstar Corp.	64,700	1,504,275
FleetBoston Financial Corp.	117,000	4,394,813
KeyCorp	7,000	196,000
Mellon Financial Corp.	47,000	2,311,813
National City Corp.	6,900	198,375
Northern Trust Corp.	7,700	628,031
Old Kent Financial Corp.	14,385	629,344
PNC Financial Services Group	4,200	306,863
Prosperity Bancshares, Inc.	67,500	1,333,125
Silicon Valley Bancshares(1)	2,100	72,581
State Street Corp.	16,200	2,012,202
SunTrust Banks, Inc.	21,800	1,373,400
U.S. Bancorp	24,300	709,256
Wachovia Corp.	7,000	406,875
Wells Fargo Co.	142,400	7,929,900 37,362,523
Diversified Financial-7.0% American Express Co.	15,900	873,506
Bear Stearns Cos., Inc.	14,400	729,900
Capital One Financial Corp.	13,900	914,794
Citigroup, Inc.	516,566	26,377,151
Convergys Corp.(1)	17,600	797,500
Franklin Resources, Inc.	9,300	354,330
Goldman Sachs Group, Inc. (The)	56,600	6,052,663
Household International, Inc.	35,700	1,963,500
John Hancock Financial Services, Inc.	10,400	391,300
Lehman Brothers Holdings, Inc.	52,600	3,557,075
MBNA Corp.	68,500	2,530,219
Merrill Lynch & Co., Inc.	95,900	6,539,181
MGIC Investment Corp.	18,700	1,261,081
Morgan Stanley Dean Witter & Co.	124,600	9,874,550
PMI Group, Inc. (The)	54,100	3,661,894
Providian Financial Corp.	18,700	1,075,250
Schwab (Charles) Corp.	78,400	2,224,600
SEI Investments Co.	6,700	750,400
Stilwell Financial, Inc.	18,800	741,425
USA Education, Inc.	4,500	306,000 70,976,319

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Insurance-3.5% AFLAC, Inc.	20,700	$ 1,494,281
Allmerica Financial Corp.	16,000	1,160,000
Allstate Corp.	48,600	2,117,138
American International Group, Inc.	136,066	13,411,005
Axa, Sponsored ADR	25,252	1,813,409
Chubb Corp.	23,100	1,998,150
Cigna Corp.	32,600	4,312,980
Cincinnati Financial Corp.	13,300	526,181
Hartford Financial Services Group, Inc.	25,300	1,786,813
Jefferson-Pilot Corp.	18,500	1,382,875
Lincoln National Corp.	24,400	1,154,425
MetLife, Inc.	62,600	2,191,000
Radian Group, Inc.	2,800	210,175
St. Paul Cos., Inc.	25,850	1,403,978 34,962,410
Savings & Loans-0.7% Dime Bancorp, Inc.	31,900	943,044
Golden State Bancorp, Inc.	67,000	2,106,313
Golden West Financial Corp.	11,000	742,500
Washington Mutual, Inc.	55,000	2,918,438 6,710,295
Healthcare-9.6%
Healthcare/Drugs-8.4% Alpharma, Inc., Cl. A	5,000	219,375
American Home Products Corp.	44,000	2,796,200
Amgen, Inc.(1)	84,000	5,370,750
Andrx Group(1)	29,600	1,713,100
Bristol-Myers Squibb Co.	31,500	2,329,031
Chiron Corp.(1)	36,400	1,619,800
COR Therapeutics, Inc.(1)	6,100	214,644
Forest Laboratories, Inc.(1)	12,000	1,594,500
Genentech, Inc.(1)	51,800	4,221,700
HCA-Healthcare Co. (The)(1)	74,500	3,278,745
Immunex Corp.(1)	54,100	2,197,813
Incyte Pharmaceuticals, Inc.(1)	4,200	104,475
Invitrogen Corp.(1)	8,550	738,506
IVAX Corp.(1)	53,200	2,037,560
Johnson & Johnson	66,400	6,976,150
Lilly (Eli) & Co.	45,200	4,206,425
Medimmune, Inc.(1)	7,900	376,731
Merck & Co., Inc.	161,800	15,148,525
Millennium Pharmaceuticals, Inc.(1)	8,800	544,500
Pfizer, Inc.	458,800	21,104,800

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Healthcare/Drugs (continued)
Pharmacia Corp.	70,900	$ 4,324,900
Schering-Plough Corp.	32,000	1,816,000
Sepracor, Inc.(1)	4,900	392,613
UnitedHealth Group, Inc.	21,800	1,337,975 84,664,818
Healthcare/Supplies & Services-1.2% Alberto-Culver Co., Cl. B	2,000	85,625
Allergan, Inc.	6,100	590,556
Applera Corp./Applied Biosystems Group	11,600	1,091,125
Baxter International, Inc.	3,500	309,094
Biomet, Inc.	3,400	134,938
Cardinal Health, Inc.	17,600	1,753,400
Guidant Corp.(1)	7,100	382,956
Medtronic, Inc.	63,300	3,821,738
Oxford Health Plans, Inc.(1)	19,200	758,400
Quest Diagnostics, Inc.(1)	2,600	369,200
Techne Corp.(1)	6,600	238,013
Tenet Healthcare Corp.	12,100	537,694
Trigon Healthcare, Inc.(1)	19,500	1,517,344
Universal Health Services, Inc., Cl. B(1)	4,800	536,400 12,126,483
Technology-22.8%
Computer Hardware-5.9% 3Com Corp.(1)	121,800	1,035,300
Agilent Technologies, Inc.(1)	36,728	2,010,858
Cabletron Systems, Inc.(1)	29,200	439,825
Compaq Computer Corp.	168,300	2,532,915
Dell Computer Corp.(1)	277,600	4,840,650
Digital Lightwave, Inc.(1)	4,900	155,269
EMC Corp.(1)	165,700	11,019,050
Gateway, Inc.(1)	35,100	631,449
Hewlett-Packard Co.	238,600	7,530,813
International Business Machines Corp.	160,200	13,617,000
Juniper Networks, Inc.(1)	36,500	4,601,281
NCR Corp.(1)	7,100	348,788
Network Appliance, Inc.(1)	14,200	911,463
Redback Networks, Inc.(1)	18,500	758,500
SanDisk Corp.(1)	6,400	177,600
Sun Microsystems, Inc.(1)	345,500	9,630,813 60,241,574

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Computer Services-1.1% Automatic Data Processing, Inc.	56,400	$ 3,570,825
CheckFree Corp.(1)	2,000	85,000
DST Systems, Inc.(1)	14,600	978,200
First Data Corp.	58,100	3,061,144
Palm, Inc.(1)	51,700	1,463,756
Paychex, Inc.	28,550	1,388,244
WebTrends Corp.(1)	4,800	138,900 10,686,069
Computer Software-5.9% Actuate Corp.(1)	18,400	351,900
Adobe Systems, Inc.(1)	48,100	2,798,819
Advent Software, Inc.(1)	7,700	308,481
America Online, Inc.(1)	42,000	1,461,600
Ariba, Inc.(1)	20,000	1,072,500
BEA Systems, Inc.(1)	11,000	740,438
BroadVision, Inc.(1)	52,500	620,156
Cadence Design Systems, Inc.(1)	41,500	1,141,250
Computer Associates International, Inc.	34,800	678,600
Computer Sciences Corp.	9,700	583,213
E.piphany, Inc.(1)	8,100	436,894
i2 Technologies, Inc.(1)	45,400	2,468,625
InfoSpace, Inc.(1)	20,000	176,875
Internet Security Systems, Inc.(1)	7,300	572,594
Interwoven, Inc.(1)	2,400	158,250
Macromedia, Inc.(1)	13,300	807,975
Mercury Interactive Corp.(1)	4,400	397,100
Micromuse, Inc.(1)	14,000	845,031
Microsoft Corp.(1)	293,300	12,721,888
Network Associates, Inc.(1)	6,000	25,125
Nuance Communications, Inc.(1)	1,200	51,750
Oracle Corp.(1)	601,200	17,472,375
Peoplesoft, Inc.(1)	12,000	446,250
Portal Software, Inc.(1)	19,500	152,953
Rational Software Corp.(1)	26,300	1,024,056
Siebel Systems, Inc.	40,600	2,745,575
Symantec Corp.(1)	15,500	517,313
TIBCO Software, Inc.(1)	25,100	1,203,231
VeriSign, Inc.	22,800	1,691,475
Veritas Software Corp.(1)	59,142	5,174,925
Vitria Technology, Inc.(1)	8,500	65,875
Wind River Systems, Inc.(1)	2,700	92,138
Yahoo!, Inc.(1)	12,000	360,750 59,365,980

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Communications Equipment-3.6% ADC Telecommunications, Inc.(1)	84,700	$ 1,535,188
Advanced Fibre Communications, Inc.(1)	15,500	279,969
CIENA Corp.(1)	25,300	2,055,625
Cisco Systems, Inc.(1)	515,000	19,698,750
Extreme Networks, Inc.(1)	8,000	313,000
Lucent Technologies, Inc.	298,300	4,027,050
New Focus, Inc.(1)	6,300	218,925
Newport Corp.	14,600	1,147,697
Nortel Networks Corp.	145,000	4,649,063
Scientific-Atlanta, Inc.	21,100	687,069
Tellabs, Inc.(1)	25,800	1,457,700 36,070,036
Electronics-6.1% Altera Corp.(1)	54,300	1,428,769
Analog Devices, Inc.(1)	70,200	3,593,363
Applied Materials, Inc.(1)	128,500	4,907,094
Atmel Corp.(1)	195,200	2,269,200
Avnet, Inc.	6,000	129,000
Cymer, Inc.(1)	5,200	133,81 9
Intel Corp.	616,500	18,533,531
International Rectifier Corp.(1)	28,200	846,000
JDS Uniphase Corp.(1)	57,000	2,376,188
Lam Research Corp.(1)	30,000	435,000
Lattice Semiconductor Corp.(1)	53,700	986,738
Linear Technology Corp.	52,900	2,446,625
LSI Logic Corp.(1)	46,100	787,849
Maxim Integrated Products, Inc.(1)	43,600	2,084,625
Micrel, Inc.(1)	11,800	397,513
Micron Technology, Inc.(1)	60,200	2,137,100
Motorola, Inc.	85,400	1,729,350
NVIDIA Corp.(1)	14,200	465,272
PMC-Sierra, Inc.(1)	17,000	1,336,625
Power-One, Inc.(1)	15,400	605,413
QLogic Corp.(1)	9,000	693,000
SDL, Inc.(1)	15,600	2,311,725
Semtech Corp.(1)	7,500	165,469
Texas Instruments, Inc.	91,400	4,330,075
Thermo Electron Corp.(1)	3,900	116,025
TriQuint Semiconductor, Inc.(1)	30,900	1,349,944
Virata Corp.(1)	11,500	125,063
Vitesse Semiconductor Corp.(1)	11,700	647,156
Waters Corp.(1)	14,400	1,202,400
Xilinx, Inc.(1)	63,800	2,942,775 61,512,706

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Photography-0.2% Eastman Kodak Co.	40,300	$ 1,586,813
Transportation-1.0%
Air Transportation-0.7% AMR Corp.(1)	16,800	658,350
Continental Airlines, Inc., Cl. B(1)	86,658	4,473,719
Delta Air Lines, Inc.	9,000	451,688
Southwest Airlines Co.	32,500	1,089,725 6,673,482
Railroads & Truckers-0.3% Union Pacific Corp.	36,700	1,862,525
XTRA Corp.(1)	18,600	892,800 2,755,325
Utilities-2.3%
Electric Utilities-1.5% AES Corp. (The)(1)	29,000	1,605,875
Allegheny Energy, Inc.	4,000	192,750
Ameren Corp.	13,300	615,956
Calpine Corp.(1)	34,400	1,550,150
Conectiv, Inc.	11,900	238,744
Dominion Resources, Inc.	9,700	649,900
DTE Energy Co.	7,000	272,563
Duke Energy Corp.	8,748	745,767
Energy East Corp.	17,100	336,656
Entergy Corp.	13,900	588,144
FirstEnergy Corp.	7,400	233,563
Florida Progress Corp.(1)	32,000	12,800
FPL Group, Inc.	4,100	294,175
IPALCO Enterprises, Inc.	10,000	241,875
Northeast Utilities Co.	10,400	252,200
PG&E Corp.	48,900	978,000
PPL Corp.	38,300	1,730,681
Public Service Enterprise Group, Inc.	55,300	2,688,963
Reliant Energy, Inc.	28,900	1,251,731
Southern Co.	18,900	628,425
TXU Corp.	5,000	221,563
Xcel Energy, Inc.	11,400	331,313 15,661,794

Statement of Investments  (Continued)
		Market Value
	Shares	See Note 1
Gas Utilities-0.8% Dynegy, Inc.	22,300	$ 1,250,194
Enron Corp.	52,100	4,330,813
NICOR, Inc.	5,900	254,806
Questar Corp.	10,800	324,675
Sempra Energy	15,929	370,349
Williams Cos., Inc. (The)	42,900	1,713,319    8,244,156
Total Common Stocks (Cost $957,836,283)		960,800,149

	Principal Amount
Repurchase Agreements-5.7%
Repurchase agreement with Banc One Capital Markets, Inc., 5.75%, dated 12/29/00, to be repurchased at $57,711,848 on 1/2/01, collateralized by U.S. Treasury Bonds, 6.625%-11.25%, 2/15/15-2/15/27, with a value of $10,698,703 and U.S. Treasury Nts., 5%-7.875%, 1/31/01-8/15/07, with a value of $48,211,923 (Cost $57,675,000)	$57,675,000	57,675,000
Total Investments, at Value (Cost $1,015,511,283)	100.7%	1,018,475,149
Liabilities in Excess of Other Assets	(0.7)	(6,953,845)
Net Assets	100.0%	$1,011,521,304
1. Non-income-producing security. 2. Identifies issues considered to be illiquid or restricted-See Note 5 of Notes to Financial Statements.
See accompanying Notes to Financial Statements.

Statement of Assets and Liabilities  December 31, 2000
Assets
Investments, at value (cost $1,015,511,283)-see accompanying statement	$1,018,475,149
Cash	2,041
Receivables and other assets: Investments sold	5,198,198
Shares of beneficial interest sold	1,601,853
Interest and dividends	688,695
Other	6,809
Total assets	1,025,972,745
Liabilities Payables and other liabilities: Investments purchased	14,214,593
Shares of beneficial interest redeemed	100,117
Trustees’ compensation	713
Distribution and service plan fees	336
Transfer and shareholder servicing agent fees	16
Other	135,666
Total liabilities	14,451,441
Net Assets	$1,011,521,304
Composition of Net Assets Par value of shares of beneficial interest	$ 47,580
Additional paid-in capital	1,038,092,435
Undistributed net investment income	5,513,216
Accumulated net realized loss on investments and foreign currency transactions	(35,094,830)
Net unrealized appreciation on investments and translation of assets and liabilities denominated in foreign currencies	2,962,903
Net assets	$1,011,521,304
Net Asset Value Per Share Net asset value, redemption price per share and offering price per share (based on net assets of $1,009,823,321 and 47,500,016 shares of beneficial interest outstanding)	$21.26
Service shares Net asset value, redemption price per share and offering price per share (based on net assets of $1,697,983 and 79,944 shares of beneficial interest outstanding)	$21.24
See accompanying Notes to Financial Statements.

Statement of Operations  For the Year Ended December 31, 2000
Investment Income Dividends (net of foreign withholding taxes of $77,260)	$ 7,312,656
Interest	4,145,819
Total income	11,458,475
Expenses Management fees	5,651,580
Distribution and service plan fees: Service shares	375
Trustees’ compensation	3,552
Transfer and shareholder servicing agent fees	1,930
Other	213,057
Total expenses	5,870,494
Net Investment Income	5,587,981
Realized and Unrealized Loss Net realized loss on: Investments	(33,503,117)
Foreign currency transactions	(60,961)
Net realized loss	(33,564,078)
Net change in unrealized depreciation on: Investments	(63,172,697)
Translation of assets and liabilities denominated in foreign currencies	(332,091)
Net change	(63,504,788)
Net realized and unrealized loss	(97,068,866)
Net Decrease in Net Assets Resulting from Operations	$(91,480,885)
See accompanying Notes to Financial Statements.

Statement of Changes in Net Assets  (Continued)
	Year Ended December 31,
	2000	1999
Operations Net investment income	$ 5,587,981	$ 2,473,903
Net realized gain (loss)	(33,564,078)	35,804,975
Net change in unrealized appreciation (depreciation)	(63,504,788)	41,879,594
Net increase (decrease) in net assets resulting from operations	(91,480,885)	80,158,472
Dividends and/or Distributions to Shareholders Dividends from net investment income	(2,497,726)	(1,427,635)
Distributions from net realized gain	(32,976,915)	(2,405,256)
Beneficial Interest Transactions Net increase in net assets resulting from beneficial interest transactions: Non-Service shares	581,387,859	170,632,137
Service shares	1,777,939	—
Net Assets Total increase	456,210,272	246,957,718
Beginning of period	555,311,032	308,353,314
End of period (including undistributed net investment income of $5,513,216 and $2,471,016, respectively)	$1,011,521,304	$555,311,032
See accompanying Notes to Financial Statements.

Financial Highlights
	Year Ended December 31,
Non-Service shares	2000	1999	1998	1997	1996
Per Share Operating Data Net asset value, beginning of period	$24.63	$20.48	$20.58	$16.37	$12.51
Income (loss) from investment operations: Net investment income	.10	.11	.13	.19	.14
Net realized and unrealized gain (loss)	(2.14)	4.29	.92	4.91	3.91
Total income (loss) from investment operations	(2.04)	4.40	1.05	5.10	4.05
Dividends and/or distributions to shareholders: Dividends from net investment income	(.09)	(.09)	(.05)	(.17)	(.14)
Distributions from net realized gain	(1.24)	(.16)	(1.10)	(.72)	(.05)
Total dividends and/or distributions to shareholders	(1.33)	(.25)	(1.15)	(.89)	(.19)
Net asset value, end of period	$21.26	$24.63	$20.48	$20.58	$16.37
Total Return, at Net Asset Value(1)	(8.78)%	21.71%	4.70%	32.48%	32.51%
Ratios/Supplemental Data Net assets, end of period (in thousands)	$1,009,823	$555,311	$308,353	$155,368	$47,009
Average net assets (in thousands)	$ 809,662	$391,063	$234,306	$ 94,906	$21,562
Ratios to average net assets:(2) Net investment income	0.69%	0.63%	0.74%	1.15%	1.41%
Expenses	0.73%	0.78%	0.79%(3)	0.83%(3)	1.00%(3)
Portfolio turnover rate	63%	118%	86%	79%	113%
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 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.

Financial Highlights(Continued)
Service shares	Period Ended December 31, 2000(1 )
Per Share Operating Data Net asset value, beginning of period	$24.04
Income (loss) from investment operations: Net investment income	.02
Net realized and unrealized loss	(2.82)
Total loss from investment operations	(2.80)
Net asset value, end of period	$21.24
Total Return, at Net Asset Value(2)	(11.61)%
Ratios/Supplemental Data Net assets, end of period (in thousands)	$1,698
Average net assets (in thousands)	$ 543
Ratios to average net assets:(3) Net investment income	0.50%
Expenses	0.88%
Portfolio turnover rate	63%
1. For the period from July 13, 2000 (inception of offering) to December 31, 2000. 2. Assumes a $1,000 hypothetical initial investment on the business day before the first day of the fiscal period (or inception of offering), with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Total returns are not annualized for periods less than one full year. Total return information does not reflect expenses that apply at the separate account level or to related insurance products. Inclusion of these charges would reduce the total return figures for all periods shown. 3. Annualized for periods of less than one full year.
See accompanying Notes to Financial Statements.

Notes to Financial Statements

1. Significant Accounting Policies
Oppenheimer Main Street Growth & Income Fund/VA (the Fund) is a separate series of Oppenheimer Variable Account Funds (the Trust), an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund’s objective is to seek high total return (which includes growth in the value of its shares as well as current income) from equity and debt securities. The Trust’s investment advisor is OppenheimerFunds, Inc. (the Manager). The following is a summary of significant accounting policies consistently followed by the Fund.
       The Fund offers two classes of shares. Both classes are sold at their offering price, which is the net asset value per share, to separate investment accounts of participating insurance companies as an underlying investment for variable life insurance policies, variable annuity contracts or other investment products. The class of shares designated as Service shares is subject to a distribution and service plan.

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).

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.

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

Federal Taxes. The Fund intends to 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.

As of December 31, 2000, the Fund had available for federal income tax purposes an unused capital loss carryover as follows:

Expiring
2008	$28,801,633

Notes to Financial Statements  (Continued)

1. Significant Accounting Policies (continued)
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.

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.
       The Fund adjusts the classification of distributions to shareholders to reflect the differences between financial statement amounts and distributions determined in accordance with income tax regulations. Accordingly, during the year ended December 31, 2000, amounts have been reclassified to reflect a decrease in paid-in capital of $25,494, a decrease in undistributed net investment income of $48,055, and a decrease in accumulated net realized loss on investments of $73,549. Net assets of the Fund were unaffected by the reclassifications.

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 $0.001 par value shares of beneficial interest. Transactions in shares of beneficial interest were as follows:

	Year Ended December 31, 2000(1)		Year Ended December 31, 1999
	Shares	Amount	Shares	Amount
Sold	27,605,948	$641,709,139	9,936,050	$224,240,741
Dividends and/or distributions reinvested	1,515,363	35,474,641	186,334	3,832,892
Redeemed	(4,166,298)	(95,795,921)	(2,632,085)	(57,441,496)
Net increase	24,955,013	$581,387,85 9	7,490,299	$170,632,137
Service shares Sold	79,978	$   1,778,724	—	$              —
Dividends and/or distributions reinvested	—	—	—	—
Redeemed	(34)	(785)	—	—
Net increase	79,944	$    1,777,939	—	$              —
1. Service shares are for the period from July 13, 2000 (inception of offering) to December 31, 2000.

Notes to Financial Statements  (Continued)

3. Purchases and Sales of Securities
The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations, for the year ended December 31, 2000, were $1,019,340,537 and $471,434,331, respectively.

As of December 31, 2000, unrealized appreciation (depreciation) based on cost of securities for federal income tax purposes of $1,018,131,697 was:

Gross unrealized appreciation	$  114,161,929
Gross unrealized depreciation	(113,818,477)
Net unrealized appreciation	$        343,452

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 year ended December 31, 2000, was an annualized rate of 0.70%, before any waiver by the Manager if applicable.

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. Effective January 1, 2001, the Fund ended the for cost agreement and began paying OFS on a fee per account basis to provide these services.

Distribution and Service Plan for Service Shares. The Fund has adopted a distribution and service plan for Service shares to pay OppenheimerFunds Distributor, Inc., the Distributor, for distribution-related services for the Fund’s Service shares. Although the plan allows for payment to be made quarterly at an annual rate of up to 0.25% of the average annual net assets of Service shares of the Fund, that rate is currently reduced to 0.15%. The Board of Trustees may increase that rate to no more than 0.25% per annum, without notification in advance. The distributor currently uses all of those fees to compensate sponsor(s) of the insurance product that offers Fund shares, for providing personal service and maintenance of accounts of their variable contract owners that hold Service shares. The impact of the service plan is to increase operating expenses of the Service shares, which results in lower performance compared to the Fund’s shares that are not subject to a service fee.

5. Illiquid or Restricted Securities
As of December 31, 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 December 31, 2000, was $8,399, which represents less than 0.01% of the Fund’s net assets, all of which is considered restricted. Information concerning restricted securities is as follows:

Security	Acquisition Date	Cost       Per Unit	Valuation Per                 Unit as of                 December 31, 2000	Unrealized    Depreciation
Stocks and Warrants Intermedia Communications, Inc.	9/29/98—	$12.51—
	12/29/98	21.54	$6.83	$9,635

Independent Auditors’ Report

To the Board of Trustees and Shareholders of Oppenheimer Main Street Growth & Income Fund/VA:

We have audited the accompanying statement of assets and liabilities of Oppenheimer Main Street Growth & Income Fund/VA (which is a series of Oppenheimer Variable Account Funds), including the statement of investments, as of December 31, 2000, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
       We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2000, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
       In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Main Street Growth & Income Fund/VA as of December 31, 2000, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP

Denver, Colorado
January 23, 2001

Shareholder Meeting(Unaudited)

On September 20, 2000, a shareholder meeting was held at which the following items and proposals were approved, as described in the Fund’s proxy statement for that meeting. The following is a report of the votes cast:
Proposal No. 1:
Election of Trustees

Nominee	For	Withheld/Abstain	Total
William L. Armstrong	525,148,434.513	12,998,236.894	538,146,671.407
Robert G. Avis	525,194,975.808	12,951,695.599	538,146,671.407
George C. Bowen	525,246,167.352	12,900,504.05 5	538,146,671.407
Edward L. Cameron	525,257,205.636	12,889,465.771	538,146,671.407
Jon S. Fossel	525,310,855.983	12,835,815.424	538,146,671.407
Sam Freedman	525,227,181.129	12,919,490.278	538,146,671.407
Raymond J. Kalinowski	524,816,532.104	13,330,139.303	538,146,671.407
C. Howard Kast	524,372,698.626	13,773,972.781	538,146,671.407
Robert M. Kirchner	524,456,936.182	13,689,735.225	538,146,671.407
Bridget A. Macaskill	525,301,814.052	12,844,857.355	538,146,671.407
F. William Marshall	525,238,164.224	12,908,507.183	538,146,671.407
James C. Swain	525,158,864.886	12,987,806.521	538,146,671.407

	For	Against	Withheld/Abstain	Total
Proposal No. 2: Ratification of the selection of Deloitte & Touche LLP as independent auditors for the Fund for the fiscal year beginning January 1, 2001.
	513,094,436.430	5,088,293.356	19,963,941.621	538,146,671.407
Proposal No. 3(a): Approval to eliminate the fundamental policy for Oppenheimer Main Street Growth & Income Fund/VA on investing in the securities of companies for the purpose of exercising control of management.
	32,318,295.044	1,724,945.951	1,751,896.603	35,795,137.598
Proposal No. 3(b): Approval to eliminate the fundamental policy for Oppenheimer Main Street Growth & Income Fund/VA on purchasing the securities of issuers in which officers or trustees have an interest.
	31,701,389.300	2,350,538.379	1,743,209.919	35,795,137.598
Proposal No. 3(c): Approval to eliminate the fundamental policy for Oppenheimer Main Street Growth & Income Fund/VA on investing in oil, gas or other mineral explorations or development programs.
	32,385,375.320	1,537,176.985	1,872,585.293	35,795,137.598
Proposal No. 4: Approval to change four of the fundamental policies for Oppenheimer Main Street Growth & Income Fund/VA to permit the Fund to participate in an inter-fund lending arrangement.
	32,220,530.329	1,675,856.248	1,898,751.021	35,795,137.598
Proposal No. 6: Approval of authorizing the Trustees to adopt an Amended and Restated Declaration of Trust.
	487,784,405.554	19,090,438.484	31,271,827.369	538,146,671.407

Federal Income Tax Information(Unaudited)

In early 2001 shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2000. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service.
       Dividends and distributions of $1.3308 per share were paid to shareholders on March 17, 2000, of which $0.7460 was designated as a “capital gain distribution” for federal income tax purposes. Whether received in stock or in cash, the capital gain distribution should be treated by shareholders as a gain from the sale of capital assets held for more than one year (long-term capital gains).
       Dividends paid by the Fund during the fiscal year ended December 31, 2000, which are not designated as capital gain distributions should be multiplied by 100% to arrive at the net amount eligible for the corporate dividend-received deduction.
       The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance.

Oppenheimer Main Street Growth & Income 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 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 F. William Marshall, Trustee Charles Albers, Vice President Nikolaos Monoyios, 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. For more complete information about Oppenheimer Main Street Growth & Income Fund/VA, please refer to the Prospectus. To obtain a copy, call your financial advisor, or call OppenheimerFunds, Inc. at 1.800.981.2871. 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.
©Copyright 2001 OppenheimerFunds, Inc. All rights reserved.