-----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, OPmthc0oWE2iCWyezC3oMpvpeNUsctK1vK0nk07AgMYygD88D5jjmTbGWuvV7Im1 5qZlHA6gs52ByBpYSsJNYQ== 0001110538-01-500133.txt : 20010910 0001110538-01-500133.hdr.sgml : 20010910 ACCESSION NUMBER: 0001110538-01-500133 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010907 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER VARIABLE ACCOUNT FUNDS CENTRAL INDEX KEY: 0000752737 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 840974272 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04108 FILM NUMBER: 1733344 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 strat_bond.txt [GRAPHIC] Semiannual Report June 30, 2001 Oppenheimer Strategic Bond Fund/VA A Series of Oppenheimer Variable Account Funds [LOGO] Oppenheimer Funds(R) The Right Way to Invest - -------------------------------------------------------------------------------- Oppenheimer Variable Account Funds--Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- ================================================================================ Objective Oppenheimer Strategic Bond Fund/VA, a series of Oppenheimer Variable Account Funds, primarily seeks a high level of current income principally derived from interest on debt securities. The Fund primarily invests in three sectors: foreign fixed income securities, U.S. Government securities and lower rated, high yield domestic corporate bonds (commonly known as "junk bonds"). Investing in foreign securities entails additional expenses and risks including foreign currency fluctuations, while investing in junk bonds carries a greater risk of default. ================================================================================ Narrative by Art Steinmetz, Co-Portfolio Manager We are pleased with the Fund's performance with a cumulative total return of 1.22% for the six-month period ended June 30, 2001 (1). Given a relatively challenging market environment, characterized by rising credit concerns in a slowing economy, the various sectors of the fixed income markets in which we invest produced reasonably attractive returns. U.S. Government securities benefited from a "flight to quality" among investors escaping a volatile stock market, while high yield corporate bonds provided strong results over the reporting period. Foreign bonds from developed markets did well, and emerging market bonds provided even better returns. In our opinion, the past six months provided further confirmation of the effectiveness of the Fund's multisector strategy for investors seeking to maintain high levels of current income. Before this year, the U.S. economy had been experiencing a dramatic slowdown. In the fourth quarter of 2000, U.S. gross domestic product (GDP), a key indicator of the economy's health, grew at an anemic 1.1% annualized rate. The U.S. Federal Reserve Board (the Fed) responded by reducing short-term interest rates six times--twice in January and once each in March, April, May and June--for a total rate cut of 2.75 percentage points. These developments affected the Fund in various ways, with certain market sectors benefiting from slower growth and others languishing. For example, U.S. Treasury securities ranked among the top-performing asset classes during the period because they are sensitive to changes in interest rates, so their prices tend to rise as interest rates fall. The Fund, however, held few of these direct government obligations because they offered unattractively low yields. We began the period with a relatively small allocation to U.S. Government agency bonds such as mortgage-backed securities, which generally have been lackluster performers because of the increase in prepayments of their underlying mortgages. When interest rates decline, more homeowners refinance their mortgages, adversely affecting most mortgage-backed securities, which may be subject to substantial price volatility. However, as refinancing activity slowed toward the end of the period, we increased our exposure to this asset class, which was providing better performance. The high yield sector received a much-needed boost when value-oriented and contrarian investors flocked to these bonds in January because of their low prices and attractively high yields in a declining interest rate environment. As a result, our high yield holdings rebounded strongly. However, the sector gave back some of those gains later in the period, following renewed concerns that the economic slowdown could persist for the rest of the year. Our emerging market holdings performed strongly as many of those developing economies have improved. We emphasized investment in countries where we received particularly good results such as certain Latin American and Eastern European countries whose economies are relatively independent of the U.S. economy. In reviewing performance, please remember that past performance cannot guarantee future results. Because of ongoing market volatility, the Fund's performance may be subject to fluctuations, and current performance may be less than the results shown. (1) Includes changes in net asset value per share and reinvestment of dividends and capital gains distributions 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. 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. 2 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Oppenheimer Variable Account Funds--Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- We also enjoyed good performance from developed market bonds, especially in Europe, despite significant fluctuations in currency exchange rates. The value of the U.S. dollar strengthened against the euro early in the period, causing the value of euro-denominated bonds to fall for U.S. investors. As the U.S. economy slowed, however, the euro gained value, ending the period at approximately the same level at which it began. As a net result, developed market bonds helped the Fund's overall performance. When 2001 began, the Fund had been positioned for an economic slowdown in the United States. We slowly increased the duration--a measure of sensitivity to changing interest rates--of our U.S. Government securities holdings as interest rates fell, enabling us to capture higher prevailing yields for a longer time. We gradually increased our exposure to euro-denominated bonds as Europe's currency appreciated relative to the U.S. dollar, allowing the Fund to participate in potential price appreciation (2). On the other hand, we made few changes to our high yield bond and emerging market holdings. In the high yield sector, we maintained our emphasis on bonds issued by energy companies, which have generally benefited from robust oil prices and high levels of demand.2 In the telecommunications area, which represents the largest concentration of high yield bond issuers, we generally focused on wireless service providers over fixed wire carriers. For the immediate future, we remain optimistic. In our opinion, investment trends appear to be advantageous for several of the fixed income market sectors in which the Fund invests. Even if bond prices remain flat in the emerging markets, our investments there should continue to provide attractively high yields. The same is true for high yield corporate bonds in the United States. Otherwise, we are maintaining our longstanding strategy of investing in multiple sectors of the global bond markets in an effort to produce the high levels of income our shareholders expect. Keeping an unwavering focus on our investment objective is a very important part of what makes Oppenheimer Strategic Bond Fund/VA The Right Way to Invest. (2) The Fund's portfolio is subject to change. Oppenheimer Strategic Bond Fund/VA 3 - -------------------------------------------------------------------------------- Statement of Investments June 30, 2001 (Unaudited) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 ============================================================================================================================ Asset-Backed Securities--3.1% - ---------------------------------------------------------------------------------------------------------------------------- American Money Management Corp., Commercial Debt Obligations Sub. Bonds, Series I, Cl. D1, 13.602%, 1/15/12(1) $ 200,000 $ 200,000 - ---------------------------------------------------------------------------------------------------------------------------- Ameriquest Finance Trust II, Collateralized Mtg. Obligations, Series 2000-1, Cl. D, 8.50%, 5/15/30(1) 318,913 309,446 - ---------------------------------------------------------------------------------------------------------------------------- Ameriquest Finance Trust III, Collateralized Mtg. Obligations, Series 2000-IA, Cl. D, 8.50%, 7/15/30(1) 1,910,438 1,853,722 - ---------------------------------------------------------------------------------------------------------------------------- Asset Backed Securities Corp., Long Beach Home Equity Loan Trust Pass-Through Certificates, Series 2000-LB1, Cl. M2F, 8.70%, 3/21/29 1,000,000 1,021,563 - ---------------------------------------------------------------------------------------------------------------------------- Conseco Finance Securitizations Corp., Home Equity Loan Pass-Through Certificates: Series 2001-A, Cl. IA4, 6.85%, 3/15/32 280,000 279,650 Series 2001-B, Cl. IA4, 6.555%, 6/15/32 1,500,000 1,486,172 - ---------------------------------------------------------------------------------------------------------------------------- Embarcadero Aircraft Securitization Trust Nts., Series 2000-A, Cl. B, 5.08%, 8/15/25(1)(2) 1,898,393 1,900,766 - ---------------------------------------------------------------------------------------------------------------------------- Impac Secured Assets CMN Owner Trust, Home Equity Collateralized Mtg. Obligations, Series 2001-5, Cl. M1, 7.81%, 7/25/31(3) 2,000,000 1,988,351 - ---------------------------------------------------------------------------------------------------------------------------- LBFTC I, Home Equity Collateralized Mtg. Obligations, Series 2000-1A, Cl. D, 10%, 2/25/30(4) 72,155 71,186 - ---------------------------------------------------------------------------------------------------------------------------- NC Finance Trust, Collateralized Mtg. Obligations, Series 1999-I, Cl. ECFD, 8.75%, 12/25/28 126,620 115,146 - ---------------------------------------------------------------------------------------------------------------------------- Option One Mortgage Securities Corp., Home Equity Mtg. Pass-Through Certificates, Series 1999-1, Cl. CTFS, 10.06%, 3/26/29(1) 164,552 154,782 - ---------------------------------------------------------------------------------------------------------------------------- Principal Residential Mortgage Capital Resources Trust, Collateralized Mtg. Obligations, Real Estate Mtg. Investment Conduit, Series 2000-1, Cl. A, 5.531%, 6/20/05(1)(2) 1,000,000 1,000,000 - ---------------------------------------------------------------------------------------------------------------------------- Salomon Brothers Mortgage Securities VII, Inc., Commercial Mtg. Pass-Through Certificates, Series 1998-1A, Cl. CE, 5%, 11/25/27 3,506 3,501 ------------ Total Asset-Backed Securities (Cost $10,406,314) 10,384,285 ============================================================================================================================ Mortgage-Backed Obligations--58.8% - ---------------------------------------------------------------------------------------------------------------------------- Government Agency--49.3% - ---------------------------------------------------------------------------------------------------------------------------- FHLMC/FNMA/Sponsored--41.8% Federal Home Loan Mortgage Corp., 11%, 11/1/14 321,161 355,060 - ---------------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., Collateralized Mtg. Obligations, Gtd. Multiclass Mtg Participation Certificates, Series 151, Cl. F, 9%, 5/15/21 554,878 585,047 - ---------------------------------------------------------------------------------------------------------------------------- Federal Home Loan Mortgage Corp., Interest-Only Stripped Mtg.-Backed Security: Series 192, Cl. IO, 14.433%, 2/1/28(5) 13,873,918 3,568,198 Series 194, Cl. IO, 12.70%, 4/1/28(5) 41,208,891 11,004,062 - ---------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn.: 6%, 7/16/31(3) 3,100,000 2,975,039 6.50%, 5/1/29 1,344,910 1,326,136 6.50%, 7/25/12--7/1/28(3) 66,100,000 65,168,070 7%, 7/25/27(3) 46,900,000 47,105,422 7.50%, 8/1/25 316,429 323,910 - ---------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn., Collateralized Mtg. Obligations, Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, Trust 1993-202, Cl. PH, 6.50%, 2/25/22(6) 4,500,000 4,601,250 - ---------------------------------------------------------------------------------------------------------------------------- Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security, Trust 294, Cl. 2, 4.413%, 2/1/28(5) 1,830,122 448,380 ------------ 137,460,574
4 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 ============================================================================================================================ GNMA/Guaranteed--7.5% Government National Mortgage Assn.: 7%, 3/15/28--7/15/28 $ 12,044,409 $ 12,168,227 7.125%, 11/20/25 101,975 104,477 7.50%, 2/15/27 1,726,632 1,773,994 8%, 11/15/25--5/15/26 1,767,016 1,834,151 - ---------------------------------------------------------------------------------------------------------------------------- Government National Mortgage Assn., Gtd. Multiclass Mtg. Participation Certificates, Series 1999-27, Cl. PQ, 7.50%, 8/16/28 8,220,125 8,572,029 ------------ 24,452,878 - ---------------------------------------------------------------------------------------------------------------------------- Private--9.5% - ---------------------------------------------------------------------------------------------------------------------------- Commercial--7.0% AMRESCO Commercial Mortgage Funding I Corp., Multiclass Mtg. Pass-Through Certificates, Series 1997-C1, Cl. G, 7%, 6/17/29(4) 100,000 84,180 - ---------------------------------------------------------------------------------------------------------------------------- Asset Securitization Corp., Commercial Mtg. Pass-Through Certificates: Series 1996-MD6, Cl. A7, 7.965%, 11/13/26(2) 2,000,000 1,830,000 Series 1997-D4, Cl. B1, 7.525%, 4/14/29(2) 375,000 297,158 Series 1997-D5, Cl. B1, 6.93%, 2/14/41 300,000 183,117 Series 1997-D5, Cl. B2, 6.93%, 2/14/41 1,250,000 589,062 - ---------------------------------------------------------------------------------------------------------------------------- FDIC Trust, Gtd. Real Estate Mtg. Investment Conduit Pass-Through Certificates, Series 1994-C1, Cl. 2G, 8.70%, 9/25/25 153,594 149,370 - ---------------------------------------------------------------------------------------------------------------------------- First Chicago/Lennar Trust 1, Commercial Mtg. Pass-Through Certificates: Series 1997-CHL1, Cl. D, 8.11%, 5/25/08(2)(4) 350,000 294,984 Series 1997-CHL1, Cl. E, 8.11%, 2/25/11(2)(4) 600,000 441,750 - ---------------------------------------------------------------------------------------------------------------------------- First Union-Lehman Brothers Commercial Mortgage Trust, Commercial Mtg. Pass-Through Certificates, Series 1997-C2, Cl. F, 7.50%, 9/18/15 225,000 180,562 - ---------------------------------------------------------------------------------------------------------------------------- General Motors Acceptance Corp., Collateralized Mtg. Obligations, Series 1998-C1, Cl. E, 7.168%, 3/15/11(2) 800,000 781,750 - ---------------------------------------------------------------------------------------------------------------------------- GMAC Commercial Mortgage Securities, Inc., Interest-Only Stripped Mtg. Pass-Through Certificates, Series 1997-C1, Cl. X, 7.444%, 7/15/27(5) 3,762,429 264,546 - ---------------------------------------------------------------------------------------------------------------------------- GMAC Commercial Mortgage Securities, Inc., Mtg. Pass-Through Certificates: Series 1997-C1, Cl. G, 7.414%, 11/15/11 440,000 344,437 Series 1997-C2, Cl. F, 6.75%, 4/16/29 250,000 151,836 - ---------------------------------------------------------------------------------------------------------------------------- Merrill Lynch Mortgage Investors, Inc., Mtg. Pass-Through Certificates, Series 1995-C2, Cl. D, 8.216%, 6/15/21(2) 268,224 275,450 - ---------------------------------------------------------------------------------------------------------------------------- Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through Certificates: Series 1996-C1, Cl. E, 7.441%, 3/15/06(1)(2) 553,342 504,226 Series 1996-C1, Cl. F, 7.441%, 2/15/28(2)(4) 162,744 124,214 Series 1997-HF1, Cl. F, 6.86%, 2/15/10(4) 150,000 129,294 Series 1997-RR, Cl. D, 7.771%, 4/30/39(4) 450,024 363,015 Series 1997-RR, Cl. E, 7.77%, 4/30/39(2)(4) 300,016 215,795 Series 1997-RR, Cl. F, 7.771%, 4/30/39(4) 600,032 361,306 Series 1997-XL1, Cl. G, 7.695%, 10/3/30(4) 390,000 348,477 Series 1998-HF1, Cl. F, 7.18%, 12/15/09(4) 1,500,000 1,310,399 - ---------------------------------------------------------------------------------------------------------------------------- Mortgage Capital Funding, Inc., Commercial Mtg. Pass-Through Certificates: Series 1996-MC1, Cl. G, 7.15%, 6/15/06(4) 1,800,000 1,586,988 Series 1996-MC2, Cl. F, 5.75%, 12/21/26 4,350,000 3,630,891 Series 1997-MC1, Cl. F, 7.452%, 5/20/07(4) 63,720 55,108 - ---------------------------------------------------------------------------------------------------------------------------- Prudential Mortgage Capital Co. II LLC, Commercial Mtg. Pass-Through Certificates, Series PRU-HTG 2000-C1, Cl. A2, 7.306%, 10/6/15 4,000,000 4,110,000
Oppenheimer Strategic Bond Fund/VA 5 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Commercial (continued) Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates: Series 1994-C2, Cl. E, 8%, 4/25/25 $ 585,018 $ 581,454 Series 1995-C1, Cl. F, 6.90%, 2/25/27 58,417 54,771 - ---------------------------------------------------------------------------------------------------------------------------- Salomon Brothers Mortgage Securities VII, Inc., Commercial Mtg. Pass-Through Certificates, Series 1996-C1, Cl. F, 8.874%, 1/20/28(2) 1,000,000 806,875 - ---------------------------------------------------------------------------------------------------------------------------- Strategic Hotel Capital, Inc., Commercial Mtg. Obligations, Series 2001-SCH1, Cl. E, 6.55%, 4/15/06(1)(2) 1,500,000 1,500,000 - ---------------------------------------------------------------------------------------------------------------------------- Structured Asset Securities Corp., Collateralized Mtg. Obligations, Series 2001-1, Cl. A, 7.50%, 7/25/30(1) 1,410,333 1,398,434 - ---------------------------------------------------------------------------------------------------------------------------- Structured Asset Securities Corp., Multiclass Pass-Through Certificates, Series 1995-C4, Cl. E, 9.026%, 6/25/26(2)(4) 146,290 149,764 ----------- 23,099,213 - ---------------------------------------------------------------------------------------------------------------------------- Residential--2.5% First Nationwide Trust, Collateralized Mtg. Pass-Through Certificates, Series 1999-1, Cl. 2A7, 6.50%, 3/25/29 2,000,000 1,965,620 - ---------------------------------------------------------------------------------------------------------------------------- Norwest Asset Securities Corp., Collateralized Mtg. Obligations, Mtg. Pass-Through Certificates, Series 1999-20, Cl. A13, 6.75%, 8/25/29 6,000,000 6,084,360 Salomon Brothers Mortgage Securities VII, Inc., Commercial Mtg. Pass-Through Certificates, Series 1996-B, Cl. 1, 7.136%, 4/25/26(4) 360,885 252,620 ------------ 8,302,600 ------------ Total Mortgage-Backed Obligations (Cost $194,769,911) 193,315,265 ============================================================================================================================ U.S. Government Obligations--6.2% - ---------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Bonds: 5.375%, 2/15/31 790,000 749,143 6.25%, 5/15/30 2,600,000 2,758,033 8.125%, 8/15/21 1,415,000 1,780,855 8.875%, 2/15/19 735,000 973,846 11.875%, 11/15/03(7) 500,000 582,180 STRIPS, 5.33%, 5/15/17(8) 6,000,000 2,308,632 STRIPS, 6.24%, 5/15/05(8) 5,704,000 4,718,931 - ---------------------------------------------------------------------------------------------------------------------------- U.S. Treasury Nts., 6.50%, 10/15/06 6,000,000 6,383,178 ------------ Total U.S. Government Obligations (Cost $20,076,259) 20,254,798 ============================================================================================================================ Foreign Government Obligations--17.7% - ---------------------------------------------------------------------------------------------------------------------------- Argentina--0.8% Argentina (Republic of) Bonds: 11.375%, 3/15/10 865,000 659,562 Series 2008, 7%, 12/19/08 1,370,000 1,037,775 Series 2018, 12.25%, 6/19/18 1,300,000 926,250 - ---------------------------------------------------------------------------------------------------------------------------- Buenos Aires (Province of) Bonds, Bonos de Consolidacion de Deudas, Series PBA1, 2.76%, 4/1/07(2)ARP 152,620 84,991 ------------ 2,708,578 - ---------------------------------------------------------------------------------------------------------------------------- Austria--0.7% Austria (Republic of) Nts., Series EMTN, 5.50%, 10/20/07EUR 2,730,000 2,373,621 - ---------------------------------------------------------------------------------------------------------------------------- Belgium--0.8% Belgium (Kingdom of) Bonds: 8.75%, 6/25/02EUR 2,600,000 2,294,049 Series 34, 4.75%, 9/28/05EUR 330,000 279,462 ------------ 2,573,511
6 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Brazil--2.1% Brazil (Federal Republic of) Bonds, 8.875%, 4/15/24 $ 2,366,000 $ 1,531,985 - ---------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Debt Capitalization Bonds, Series 20 yr., 8%, 4/15/14 1,172,301 871,899 - ---------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Debt Conversion Bonds: Series 18 yr., 5.50%, 4/15/12(2) 4,195,000 2,983,694 Series D, 5.688%, 4/15/12(2) 890,000 633,012 - ---------------------------------------------------------------------------------------------------------------------------- Brazil (Federal Republic of) Eligible Interest Bonds, 7.375%, 4/15/06(2) 68,000 60,690 Brazil (Federal Republic of) Unsec. Unsub. Bonds, 11%, 8/17/40 1,080,600 803,426 ------------ 6,884,706 - ---------------------------------------------------------------------------------------------------------------------------- Bulgaria--0.5% Bulgaria (Republic of) Disc. Bonds, Tranche A, 6.313%, 7/28/24(2) 1,170,000 919,913 - ---------------------------------------------------------------------------------------------------------------------------- Bulgaria (Republic of) Interest Arrears Debs., Series PDI, 6.313%, 7/28/11(2) 1,090,000 861,100 ------------ 1,781,013 - ---------------------------------------------------------------------------------------------------------------------------- Canada--0.1% Canada (Government of) Nts., 0.70%, 3/20/06(JPY) 7,000,000 57,262 - ---------------------------------------------------------------------------------------------------------------------------- Ontario, Canada (Province of) Unsec. Unsub. Nts., 1.875%, 1/25/10(JPY) 41,000,000 353,826 ------------ 411,088 - ---------------------------------------------------------------------------------------------------------------------------- Colombia--0.4% Colombia (Republic of) Unsec. Unsub. Bonds: 8.375%, 2/15/27 240,000 168,000 11.75%, 2/25/20 683,000 653,973 - ---------------------------------------------------------------------------------------------------------------------------- Colombia (Republic of) Unsec. Unsub. Nts., 11.375%, 1/31/08(EUR) 570,000 490,102 - ---------------------------------------------------------------------------------------------------------------------------- Financiera Energetica Nacional SA Nts., 9.375%, 6/15/06(1) 150,000 142,875 ------------ 1,454,950 - ---------------------------------------------------------------------------------------------------------------------------- Ecuador--0.6% Ecuador (Republic of) Unsec. Bonds: 4%, 8/15/30(2) 870,000 376,275 12%, 11/15/12 2,110,000 1,483,330 ------------ 1,859,605 - ---------------------------------------------------------------------------------------------------------------------------- Egypt--0.2% Egypt (Arab Republic of) Unsec. Unsub. Bonds, 8.75%, 7/11/11(3) 615,000 614,268 - ---------------------------------------------------------------------------------------------------------------------------- Finland--0.7% Finland (Republic of) Bonds, 7.25%, 4/18/06(EUR) 2,600,000 2,426,904 - ---------------------------------------------------------------------------------------------------------------------------- France--0.2% France (Government of) Bonds, Obligations Assimilables du Tresor, 5.50%, 4/25/07(EUR) 740,000 647,095 - ---------------------------------------------------------------------------------------------------------------------------- Germany--0.5% Germany (Republic of) Bonds: Series 92, 8%, 7/22/02(EUR) 1,020,000 895,914 Series 98, 5.25%, 1/4/08(EUR) 920,000 798,422 ------------ 1,694,336 - ---------------------------------------------------------------------------------------------------------------------------- Great Britain--0.4% United Kingdom Treasury Bonds: 6.50%, 12/7/03(GBP) 450,000 646,170 9%, 8/6/12(GBP) 305,000 559,139 ------------ 1,205,309
Oppenheimer Strategic Bond Fund/VA 7 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Hungary--0.8% Hungary (Government of) Bonds: Series 01/F, 15%, 7/24/01(HUF) 4,230,000 $ 14,727 Series 03/H, 10.82%, 3/12/03(2)(HUF) 128,330,000 444,262 Series 05/E, 9.25%, 5/12/05(HUF) 121,090,000 433,137 Series 05/F, 10.95%, 8/24/05(2)(HUF) 126,310,000 436,172 Series 06/E, 8.50%, 5/12/06(HUF) 335,470,000 1,186,115 ------------ 2,514,413 - ---------------------------------------------------------------------------------------------------------------------------- Italy--0.2% Italy (Republic of) Treasury Bonds, Buoni del Tesoro Poliennali: 4.25%, 11/1/09(EUR) 580,000 455,428 4.75%, 4/15/03(EUR) 420,000 357,812 ------------ 813,240 - ---------------------------------------------------------------------------------------------------------------------------- Ivory Coast--0.0% Ivory Coast (Government of) Past Due Interest Bonds, Series F, 3/29/18(9)(11)(FRF) 2,892,750 61,602 - ---------------------------------------------------------------------------------------------------------------------------- Mexico--1.2% United Mexican States Bonds: 5.01%, 12/31/19(DEM) 1,695,000 599,431 11.50%, 5/15/26 1,000,000 1,262,500 - ---------------------------------------------------------------------------------------------------------------------------- United Mexican States Collateralized Fixed Rate Par Bonds, Series B, 6.25%, 12/31/19 20,000 18,250 - ---------------------------------------------------------------------------------------------------------------------------- United Mexican States Nts.: 8.125%, 12/30/19 1,175,000 1,113,313 8.375%, 1/14/11 905,000 913,145 ------------ 3,906,639 - ---------------------------------------------------------------------------------------------------------------------------- Norway--0.4% Norway (Government of) Bonds: 6%, 5/16/11(NOK) 5,755,000 586,849 9.50%, 10/31/02(NOK) 5,815,000 639,557 ------------ 1,226,406 - ---------------------------------------------------------------------------------------------------------------------------- Pakistan--0.0% Pakistan (Islamic Republic of) Sr. Unsec. Bonds, 10%, 12/13/05 190,000 149,625 - ---------------------------------------------------------------------------------------------------------------------------- Panama--0.2% Panama (Republic of) Bonds: 8.875%, 9/30/27 345,000 315,675 10.75%, 5/15/20 75,000 79,688 - ---------------------------------------------------------------------------------------------------------------------------- Panama (Republic of) Interest Reduction Bonds, 4.50%, 7/17/14(2) 135,000 119,813 ------------ 515,176 - ---------------------------------------------------------------------------------------------------------------------------- Peru--0.4% Peru (Republic of) Sr. Nts., Zero Coupon, 4.53%, 2/28/16(8) 2,860,926 1,289,705 - ---------------------------------------------------------------------------------------------------------------------------- Philippines--0.1% Philippines (Republic of) Nts., 10.625%, 3/16/25 410,000 372,075 - ---------------------------------------------------------------------------------------------------------------------------- Poland--1.0% Poland (Republic of) Bonds: Series 0403, Zero Coupon, 14.16%, 4/21/03(8)(PLZ) 11,135,000 2,158,005 Series 0603, 12%, 6/12/03(PLZ) 5,070,000 1,207,135 ------------ 3,365,140 - ---------------------------------------------------------------------------------------------------------------------------- Portugal--0.1% Portugal (Republic of) Obrig Do Tes Medio Prazo Unsec. Unsub. Nts., 5.85%, 5/20/10(EUR) 350,000 305,325
8 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Russia--1.9% Russian Federation Unsec. Unsub. Nts., 8.25%, 3/31/10 $ 417,366 $ 320,850 - ---------------------------------------------------------------------------------------------------------------------------- Russian Federation Unsub. Bonds, 8.25%, 3/31/10(10) 1,545,000 1,204,096 - ---------------------------------------------------------------------------------------------------------------------------- Russian Federation Unsub. Nts., 5%, 3/31/30(2) 9,811,875 4,649,602 ------------ 6,174,548 - ---------------------------------------------------------------------------------------------------------------------------- South Africa--0.9% South Africa (Republic of) Bonds, Series 153, 13%, 8/31/10ZAR 20,115,000 2,798,606 - ---------------------------------------------------------------------------------------------------------------------------- Turkey--1.0% Turkey (Republic of) Bonds, 11.75%, 6/15/10 1,750,000 1,535,625 - ---------------------------------------------------------------------------------------------------------------------------- Turkey (Republic of) Sr. Unsec. Unsub. Nts., 11.875%, 1/15/30 1,090,000 915,600 - ---------------------------------------------------------------------------------------------------------------------------- Turkey (Republic of) Sr. Unsub. Bonds, 12.375%, 6/15/09 785,000 716,313 ------------ 3,167,538 - ---------------------------------------------------------------------------------------------------------------------------- Ukraine--0.2% Ukraine (Republic of) Unsec. Sr. Nts., 11%, 3/15/07 882,700 689,278 - ---------------------------------------------------------------------------------------------------------------------------- Venezuela--1.3% Venezuela (Republic of) Bonds, 9.25%, 9/15/27 3,995,000 2,766,538 - ---------------------------------------------------------------------------------------------------------------------------- Venezuela (Republic of) Debs., Series DL, 4.75%, 12/18/07(2) 1,807,596 1,507,084 ------------ 4,273,622 ------------ Total Foreign Government Obligations (Cost $58,777,160) 58,257,922 ============================================================================================================================ Loan Participations--0.6% - ---------------------------------------------------------------------------------------------------------------------------- Algeria (Republic of) Trust III Nts., Tranche 3, 1.125%, 3/4/10(1)(2)JPY 28,219,263 163,191 - ---------------------------------------------------------------------------------------------------------------------------- Morocco (Kingdom of) Loan Participation Agreement, Tranche A, 5.094%, 1/1/09(1)(2) 1,100,000 1,014,750 - ---------------------------------------------------------------------------------------------------------------------------- PT Bank Ekspor Impor Indonesia Nts., Series 4 yr., 10.344%, 8/25/02(1)(2) 300,000 280,500 - ---------------------------------------------------------------------------------------------------------------------------- Shoshone Partners Loan Trust Sr. Nts., 6.064%, 4/28/02 (representing a basket of reference loans and a total return swap between Chase Manhattan Bank and the Trust)(1)(2) 750,000 478,502 ------------ Total Loan Participations (Cost $2,201,618) 1,936,943 ============================================================================================================================ Corporate Bonds and Notes--41.5% - ---------------------------------------------------------------------------------------------------------------------------- Aerospace/Defense--0.5% Alliant Techsystems, Inc., 8.50% Sr. Sub Nts., 5/15/11(4) 300,000 304,500 - ---------------------------------------------------------------------------------------------------------------------------- BE Aerospace, Inc.: 8.875% Sr. Sub. Nts., 5/1/11(4) 400,000 398,000 9.50% Sr. Unsec. Sub. Nts., 11/1/08 250,000 255,000 - ---------------------------------------------------------------------------------------------------------------------------- Fairchild Corp., 10.75% Sr. Unsec. Sub. Nts., 4/15/09 550,000 449,625 - ---------------------------------------------------------------------------------------------------------------------------- Greater Toronto Airports Authority, 5.40% Debs., 12/3/02CAD 240,000 159,421 - ---------------------------------------------------------------------------------------------------------------------------- SC International Services, Inc., 9.25% Sr. Sub. Nts., Series B, 9/1/07 200,000 215,250 ------------ 1,781,796 - ---------------------------------------------------------------------------------------------------------------------------- Chemicals--1.2% Georgia Gulf Corp., 10.375% Sr. Unsec. Sub. Nts., 11/1/07 200,000 205,000 - ---------------------------------------------------------------------------------------------------------------------------- Huntsman Corp./ICI Chemical Co. plc: 10.125% Sr. Unsec. Sub. Nts., 7/1/09 600,000 594,000 10.125% Sr. Unsec. Sub. Nts., 7/1/09(EUR) 300,000 252,710 Zero Coupon Sr. Unsec. Disc. Nts., 13.09%, 12/31/09(8) 750,000 230,625 - ---------------------------------------------------------------------------------------------------------------------------- Lyondell Chemical Co.: 9.625% Sr. Sec. Nts., Series A, 5/1/07 400,000 399,000 10.875% Sr. Sub. Nts., 5/1/09(6) 300,000 295,500
Oppenheimer Strategic Bond Fund/VA 9 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Chemicals (continued) MacDermid, Inc., 9.125% Sr. Sub. Nts., 7/15/11(4) $ 600,000 $ 606,000 - ---------------------------------------------------------------------------------------------------------------------------- Messer Griesheim Holding AG, 10.375% Sr. Nts., 6/1/11(1)EUR 350,000 305,940 - ---------------------------------------------------------------------------------------------------------------------------- NL Industries, Inc., 11.75% Sr. Sec. Nts., 10/15/03 111,000 110,445 - ---------------------------------------------------------------------------------------------------------------------------- PCI Chemicals Canada, Inc., 9.25% Sec. Nts., 10/15/07(9)(11) 175,000 85,750 - ---------------------------------------------------------------------------------------------------------------------------- Pioneer Americas Acquisition Corp., 9.25% Sr. Nts., 6/15/07(9)(11) 250,000 80,000 - ---------------------------------------------------------------------------------------------------------------------------- Polymer Group, Inc., 9% Sr. Unsec. Sub. Nts., Series B, 7/1/07 500,000 187,500 - ---------------------------------------------------------------------------------------------------------------------------- Sterling Chemicals, Inc.: 11.75% Sr. Unsec. Sub. Nts., 8/15/06(9) 540,000 132,300 12.375% Sr. Sec. Nts., Series B, 7/15/06(9) 400,000 314,000 ------------ 3,798,770 - ---------------------------------------------------------------------------------------------------------------------------- Consumer Non-Durables--1.1% AKI Holdings Corp., 0%/13.50% Sr. Disc. Debs., 7/1/09(12) 150,000 77,250 - ---------------------------------------------------------------------------------------------------------------------------- AKI, Inc., 10.50% Sr. Unsec. Nts., 7/1/08 100,000 96,000 - ---------------------------------------------------------------------------------------------------------------------------- Boyds Collection Ltd. (The), 9% Sr. Unsec. Sub. Nts., Series B, 5/15/08 236,000 238,360 - ---------------------------------------------------------------------------------------------------------------------------- Galey & Lord, Inc., 9.125% Sr. Unsec. Sub. Nts., 3/1/08 400,000 182,000 - ---------------------------------------------------------------------------------------------------------------------------- Globe Manufacturing Corp., 10% Sr. Unsec. Sub. Nts., Series B, 8/1/08(1)(9)(11) 315,000 -- - ---------------------------------------------------------------------------------------------------------------------------- Holmes Products Corp., 9.875% Sr. Unsec. Sub. Nts., Series B, 11/15/07 200,000 73,000 - ---------------------------------------------------------------------------------------------------------------------------- Levi Strauss & Co., 11.625% Sr. Unsec. Nts., 1/15/08 800,000 724,000 - ---------------------------------------------------------------------------------------------------------------------------- Phillips-Van Heusen Corp., 9.50% Sr. Unsec. Sub. Nts., 5/1/08(1) 200,000 205,000 - ---------------------------------------------------------------------------------------------------------------------------- Playtex Products, Inc., 9.375% Sr. Sub. Nts., 6/1/11(4) 500,000 511,250 - ---------------------------------------------------------------------------------------------------------------------------- Revlon Consumer Products Corp., 9% Sr. Nts., 11/1/06 1,000,000 720,000 - ---------------------------------------------------------------------------------------------------------------------------- Salton, Inc.: 10.75% Sr. Unsec. Sub. Nts., 12/15/05 425,000 425,000 12.25% Sr. Sub. Nts., 4/15/08(4) 400,000 410,000 - ---------------------------------------------------------------------------------------------------------------------------- Styling Technology Corp., 10.875% Sr. Unsec. Sub. Nts., 7/1/08(1)(9)(11) 70,000 7 - ---------------------------------------------------------------------------------------------------------------------------- Williams (J. B.) Holdings, Inc., 12% Sr. Nts., 3/1/04(1) 100,000 98,500 ------------ 3,760,367 - ---------------------------------------------------------------------------------------------------------------------------- Energy--2.6% AEI Resources, Inc., 11.50% Sr. Sub. Nts., 12/15/06(4)(9)(11) 250,000 88,125 - ---------------------------------------------------------------------------------------------------------------------------- Chesapeake Energy Corp., 8.125% Sr. Nts., 4/1/11(4) 500,000 470,000 - ---------------------------------------------------------------------------------------------------------------------------- Clark Refining & Marketing, Inc., 8.875% Sr. Sub. Nts., 11/15/07 200,000 153,000 - ---------------------------------------------------------------------------------------------------------------------------- Denbury Management, Inc., 9% Sr. Sub. Nts., 3/1/08 600,000 585,000 - ---------------------------------------------------------------------------------------------------------------------------- Dresser, Inc., 9.375% Sr. Sub. Nts., 4/15/11(4) 400,000 407,000 - ---------------------------------------------------------------------------------------------------------------------------- Frontier Oil Corp., 11.75% Sr. Nts., 11/15/09 400,000 430,000 - ---------------------------------------------------------------------------------------------------------------------------- Grant Geophysical, Inc., 9.75% Sr. Unsec. Nts., Series B, 2/15/08(1) 560,000 394,800 - ---------------------------------------------------------------------------------------------------------------------------- Leviathan Gas Pipeline Partners LP/Leviathan Finance Corp., 10.375% Sr. Unsec. Sub. Nts., Series B, 6/1/09 400,000 428,000 - ---------------------------------------------------------------------------------------------------------------------------- Nuevo Energy Co., 9.375% Sr. Unsec. Sub. Nts., Series B, 10/1/10 400,000 404,000 - ---------------------------------------------------------------------------------------------------------------------------- Ocean Rig Norway AS, 10.25% Sr. Sec. Nts., 6/1/08 700,000 635,250 - ---------------------------------------------------------------------------------------------------------------------------- P&L Coal Holdings Corp., 9.625% Sr. Sub. Nts., Series B, 5/15/08 403,000 427,180 - ---------------------------------------------------------------------------------------------------------------------------- Parker Drilling Co., 9.75% Sr. Unsec. Nts., Series D, 11/15/06 400,000 410,000 - ---------------------------------------------------------------------------------------------------------------------------- Petroleos Mexicanos, 9.50% Sr. Sub. Nts., 9/15/27 625,000 668,750 - ---------------------------------------------------------------------------------------------------------------------------- Pogo Producing Co., 8.75% Sr. Sub. Nts., Series B, 5/15/07 370,000 375,550 - ---------------------------------------------------------------------------------------------------------------------------- RAM Energy, Inc., 11.50% Sr. Unsec. Nts., 2/15/08 900,000 830,250
10 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Energy (continued) SESI LLC, 8.875% Sr. Unsec. Nts., 5/15/11(4) $ 700,000 $ 705,250 - ---------------------------------------------------------------------------------------------------------------------------- Statia Terminals International NV/Statia Terminals (Canada), Inc., 11.75% First Mtg. Nts., Series B, 11/15/03(1) 175,000 181,125 - ---------------------------------------------------------------------------------------------------------------------------- Stone Energy Corp., 8.75% Sr. Sub. Nts., 9/15/07 270,000 276,750 - ---------------------------------------------------------------------------------------------------------------------------- Universal Compression Holdings, Inc., 0%/9.875% Sr. Disc. Nts., 2/15/08(12) 800,000 732,000 ------------ 8,602,030 - ---------------------------------------------------------------------------------------------------------------------------- Financial--3.7% AmeriCredit Corp., 9.875% Gtd. Sr. Nts., 4/15/06 600,000 606,000 - ---------------------------------------------------------------------------------------------------------------------------- AMRESCO, Inc.: 9.875% Sr. Sub. Nts., Series 98-A, 3/15/05(9) 300,000 169,500 10% Sr. Sub. Nts., Series 97-A, 3/15/04(9) 100,000 56,500 - ---------------------------------------------------------------------------------------------------------------------------- Bank Plus Corp., 12% Sr. Nts., 7/18/07(1) 7,000 7,490 - ---------------------------------------------------------------------------------------------------------------------------- Conseco, Inc., 10.75% Sr. Unsec. Nts., 6/15/08 700,000 689,500 - ---------------------------------------------------------------------------------------------------------------------------- Development Bank of Japan (The), 1.75% Unsec. Nts., 6/21/10JPY 72,000,000 617,675 - ---------------------------------------------------------------------------------------------------------------------------- European Investment Bank, 3% Eligible Interest Nts., 9/20/06JPY 70,000,000 638,413 - ---------------------------------------------------------------------------------------------------------------------------- Fuji JGB Investment LLC: 9.87% Non-Cum. Preferred Bonds, Series A, 12/31/49 165,000 153,796 9.87% Non-Cum. Preferred Bonds, Series A, 12/31/49(4) 1,895,000 1,803,909 - ---------------------------------------------------------------------------------------------------------------------------- General Motors Acceptance Corp., 6.875% Nts., Series EC, 9/9/04GBP 540,000 767,133 - ---------------------------------------------------------------------------------------------------------------------------- Gold Eagle Capital Ltd., 10.337% Sec. Nts., 4/7/02(1)(2) 500,000 498,450 - ---------------------------------------------------------------------------------------------------------------------------- Hanvit Bank: 0%/12.75% Unsec. Sub. Nts., 3/1/10(4)(12) 115,000 123,511 0%/12.75% Unsec. Sub. Nts., 3/1/10(12) 75,000 80,550 - ---------------------------------------------------------------------------------------------------------------------------- IBJ Preferred Capital Co. (The) LLC: 8.79% Bonds, 12/29/49(2)(4) 1,825,000 1,626,214 8.79% Non-Cum. Preferred Bonds, Series A, 12/29/49 105,000 92,494 - ---------------------------------------------------------------------------------------------------------------------------- Inter-American Development Bank, 1.90% Unsec. Bonds, 7/8/09JPY 15,000,000 131,515 - ---------------------------------------------------------------------------------------------------------------------------- KfW International Finance, Inc., 1.75% Bonds, 3/23/10JPY 11,000,000 94,950 - ---------------------------------------------------------------------------------------------------------------------------- Korea Exchange Bank: 13.75% Unsec. Sub. Bonds, 6/30/10(2) 540,000 588,937 13.75% Unsec. Unsub. Bonds, 6/30/10(2)(4) 30,000 32,505 - ---------------------------------------------------------------------------------------------------------------------------- LaBranche & Co., Inc., 12% Sr. Unsec. Sub. Nts., 3/2/07 200,000 224,000 - ---------------------------------------------------------------------------------------------------------------------------- Local Financial Corp., 11% Sr. Nts., 9/8/04(1) 150,000 150,750 - ---------------------------------------------------------------------------------------------------------------------------- Ocwen Capital Trust I, 10.875% Capital Nts., 8/1/27(1) 150,000 120,750 - ---------------------------------------------------------------------------------------------------------------------------- Ocwen Financial Corp., 11.875% Nts., 10/1/03 150,000 144,000 - ---------------------------------------------------------------------------------------------------------------------------- Oesterreichische Kontrollbank AG, 1.80% Unsec. Nts., 3/22/10JPY 11,000,000 95,320 - ---------------------------------------------------------------------------------------------------------------------------- Ongko International Finance Co. BV, 10.50% Sec. Nts., 3/29/04(1)(9)(11) 90,000 1,800 - ---------------------------------------------------------------------------------------------------------------------------- Pemex Project Funding Master Trust: 9.125% Unsec. Unsub. Medium-Term Nts., 10/13/10 990,000 1,050,637 9.125% Unsec. Unsub. Medium-Term Nts., 10/13/10(4) 760,000 806,550 - ---------------------------------------------------------------------------------------------------------------------------- Saul (B.F.) Real Estate Investment Trust, 9.75% Sr. Sec. Nts., Series B, 4/1/08 245,000 239,181 - ---------------------------------------------------------------------------------------------------------------------------- SBS Agro Finance BV, 10.25% Bonds, 7/21/01(1)(9)(11) 339,000 15,255 - ---------------------------------------------------------------------------------------------------------------------------- Tokai Preferred Capital Co. LLC, 9.98% Non-Cum. Bonds, Series A, 12/29/49(4) 680,000 650,907 ------------ 12,278,192
Oppenheimer Strategic Bond Fund/VA 11 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Food & Drug--0.4% Family Restaurants, Inc., 9.75% Sr. Nts., 2/1/02(1)(9)(11) $ 500,000 $ 31,875 - ---------------------------------------------------------------------------------------------------------------------------- Fleming Cos., Inc.: 10.125% Sr. Nts., 4/1/08(4) 400,000 412,000 10.625% Sr. Sub. Nts., Series B, 7/31/07 500,000 515,000 - ---------------------------------------------------------------------------------------------------------------------------- Pantry, Inc. (The), 10.25% Sr. Sub. Nts., 10/15/07 200,000 195,000 Shoppers Food Warehouse Corp., 9.75% Sr. Nts., 6/15/04 155,000 161,568 ------------ 1,315,443 - ---------------------------------------------------------------------------------------------------------------------------- Food/Tobacco--0.9% Aurora Foods, Inc., 8.75% Sr. Sub. Nts., Series B, 7/1/08 300,000 256,500 - ---------------------------------------------------------------------------------------------------------------------------- Del Monte Corp., 9.25% Sr. Sub. Nts., 5/15/11(4) 300,000 307,500 - ---------------------------------------------------------------------------------------------------------------------------- Doane Pet Care Co., 9.75% Sr. Unsec. Sub. Nts., 5/15/07 400,000 274,500 - ---------------------------------------------------------------------------------------------------------------------------- Packaged Ice, Inc., 9.75% Sr. Unsec. Nts., Series B, 2/1/05 200,000 154,000 - ---------------------------------------------------------------------------------------------------------------------------- SmithField Foods, Inc., 7.625% Sr. Unsec. Sub. Nts., 2/15/08 400,000 392,000 - ---------------------------------------------------------------------------------------------------------------------------- Sparkling Spring Water Group Ltd., 11.50% Sr. Sec. Sub. Nts., 11/15/07(1) 200,000 155,000 - ---------------------------------------------------------------------------------------------------------------------------- United Biscuits Finance plc, 10.75% Sr. Sub. Nts., 4/15/11(4)GBP 400,000 594,907 - ---------------------------------------------------------------------------------------------------------------------------- Winn-Dixie Stores, Inc., 8.875% Sr. Nts., 4/1/08 800,000 814,000 ------------ 2,948,407 - ---------------------------------------------------------------------------------------------------------------------------- Forest Products/Containers--1.5% Ainsworth Lumber, Inc., 12.50% Sr. Nts., 7/15/07(13) 400,000 370,000 - ---------------------------------------------------------------------------------------------------------------------------- Ball Corp.: 7.75% Sr. Unsec. Nts., 8/1/06 125,000 127,344 8.25% Sr. Unsec. Sub. Nts., 8/1/08 125,000 127,187 - ---------------------------------------------------------------------------------------------------------------------------- Consumers International, Inc., 10.25% Sr. Sec. Nts., 4/1/05(1)(9)(11) 250,000 79,062 - ---------------------------------------------------------------------------------------------------------------------------- Doman Industries Ltd., 8.75% Sr. Nts., 3/15/04 900,000 558,000 - ---------------------------------------------------------------------------------------------------------------------------- Gaylord Container Corp., 9.75% Sr. Unsec. Nts., Series B, 6/15/07 600,000 381,000 - ---------------------------------------------------------------------------------------------------------------------------- Packaging Corp. of America, 9.625% Sr. Unsec. Sub. Nts., 4/1/09 750,000 799,687 - ---------------------------------------------------------------------------------------------------------------------------- Riverwood International Corp.: 10.625% Sr. Unsec. Nts., 8/1/07 750,000 768,750 10.875% Sr. Sub. Nts., 4/1/08 250,000 241,250 - ---------------------------------------------------------------------------------------------------------------------------- SD Warren Co., 14% Unsec. Nts., 12/15/06(13) 417,149 451,564 - ---------------------------------------------------------------------------------------------------------------------------- Stone Container Corp.: 9.25% Sr. Nts., 2/1/08(4) 200,000 204,250 9.75% Sr. Nts., 2/1/11(4) 600,000 615,000 - ---------------------------------------------------------------------------------------------------------------------------- U.S. Timberlands Co. LP, 9.625% Sr. Nts., 11/15/07 150,000 120,750 ------------ 4,843,844 - ---------------------------------------------------------------------------------------------------------------------------- Gaming/Leisure--2.9% Capstar Hotel Co., 8.75% Sr. Sub. Nts., 8/15/07 275,000 275,000 - ---------------------------------------------------------------------------------------------------------------------------- Felcor Lodging LP, 8.50% Sr. Nts., 6/1/11(4) 800,000 768,000 - ---------------------------------------------------------------------------------------------------------------------------- Florida Panthers Holdings, Inc., 9.875% Sr. Sub. Nts., 4/15/09 450,000 461,250 - ---------------------------------------------------------------------------------------------------------------------------- HMH Properties, Inc., 8.45% Sr. Nts., Series C, 12/1/08 500,000 488,750 - ---------------------------------------------------------------------------------------------------------------------------- Hollywood Casino Corp., 11.25% Sr. Sec. Nts., 5/1/07 250,000 265,000 - ---------------------------------------------------------------------------------------------------------------------------- Hollywood Park, Inc., 9.25% Sr. Unsec. Sub. Nts., Series B, 2/15/07 325,000 300,625 - ---------------------------------------------------------------------------------------------------------------------------- Horseshoe Gaming LLC, 9.375% Sr. Sub. Nts., 6/15/07 425,000 450,500 - ---------------------------------------------------------------------------------------------------------------------------- Intrawest Corp., 9.75% Sr. Nts., 8/15/08 350,000 351,750 - ---------------------------------------------------------------------------------------------------------------------------- Jupiters Ltd., 8.50% Sr. Unsec. Nts., 3/1/06(1) 400,000 396,000
12 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Gaming/Leisure (continued) Mandalay Resort Group, 10.25% Sr. Unsec. Sub. Nts., Series B, 8/1/07 $ 750,000 $ 789,375 - ---------------------------------------------------------------------------------------------------------------------------- Meristar Hospitality Corp.: 8.75% Sr. Unsec. Sub. Nts., 8/15/07 325,000 325,000 9.125% Sr. Nts., 1/15/11(4) 600,000 607,500 - ---------------------------------------------------------------------------------------------------------------------------- MGM Mirage, Inc., 8.375% Sr. Unsec. Sub. Nts., 2/1/11 800,000 809,000 - ---------------------------------------------------------------------------------------------------------------------------- Mohegan Tribal Gaming Authority: 8.125% Sr. Nts., 1/1/06 300,000 305,250 8.75% Sr. Unsec. Sub. Nts., 1/1/09 700,000 722,750 - ---------------------------------------------------------------------------------------------------------------------------- Premier Cruise Ltd., 11% Sr. Nts., 3/15/08(1)(9)(11) 250,000 -- - ---------------------------------------------------------------------------------------------------------------------------- Premier Parks, Inc.: 0%/10% Sr. Disc. Nts., 4/1/08(12) 450,000 365,625 9.25% Sr. Nts., 4/1/06 100,000 100,000 9.75% Sr. Nts., 6/15/07 100,000 101,000 - ---------------------------------------------------------------------------------------------------------------------------- Six Flags Entertainment Corp., 8.875% Sr. Nts., 4/1/06 200,000 200,000 - ---------------------------------------------------------------------------------------------------------------------------- Station Casinos, Inc., 9.875% Sr. Unsec. Sub. Nts., 7/1/10 800,000 833,000 - ---------------------------------------------------------------------------------------------------------------------------- Trump Atlantic City Associates/Trump Atlantic City Funding, Inc., 11.25% First Mtg. Nts., 5/1/06 25,000 16,750 - ---------------------------------------------------------------------------------------------------------------------------- Venetian Casino Resort LLC/Las Vegas Sands, Inc., 12.25% Mtg. Nts., 11/15/04 450,000 483,750 ------------ 9,415,875 - ---------------------------------------------------------------------------------------------------------------------------- Healthcare--1.9% Beverly Enterprises, Inc., 9.625% Sr. Nts., 4/15/09(4) 800,000 824,000 - ---------------------------------------------------------------------------------------------------------------------------- Charles River Laboratories International, Inc., 13.50% Sr. Sub. Nts., Series B, 10/1/09 227,500 266,175 - ---------------------------------------------------------------------------------------------------------------------------- Fresenius Medical Care Capital Trust II, 7.875% Nts., 2/1/08 900,000 879,750 - ---------------------------------------------------------------------------------------------------------------------------- Fresenius Medical Care Capital Trust III, 7.375% Nts., 2/1/08DEM 25,000 10,727 - ---------------------------------------------------------------------------------------------------------------------------- Fresenius Medical Care Capital Trust IV, 7.875% Trust Preferred Nts., 6/15/11(4) 600,000 588,000 - ---------------------------------------------------------------------------------------------------------------------------- ICN Pharmaceuticals, Inc.: 8.75% Sr. Nts., 11/15/08(4) 200,000 207,000 9.75% Sr. Nts., 11/15/08(4) 350,000 360,500 - ---------------------------------------------------------------------------------------------------------------------------- Kinetic Concepts, Inc., 9.625% Sr. Unsec. Sub. Nts., Series B, 11/1/07(1) 250,000 231,250 - ---------------------------------------------------------------------------------------------------------------------------- Magellan Health Services, Inc.: 9% Sr. Sub. Nts., 2/15/08 700,000 663,250 9.375% Sr. Nts., 11/15/07(4) 700,000 714,875 - ---------------------------------------------------------------------------------------------------------------------------- Tenet Healthcare Corp., 8.625% Sr. Sub. Nts., 1/15/07 650,000 677,625 - ---------------------------------------------------------------------------------------------------------------------------- Triad Hospitals, Inc., 8.75% Sr. Nts., 5/1/09(4) 400,000 409,000 - ---------------------------------------------------------------------------------------------------------------------------- Unilab Finance Corp., 12.75% Sr. Sub. Nts., 10/1/09 300,000 349,875 ------------ 6,182,027 - ---------------------------------------------------------------------------------------------------------------------------- Housing--1.5% Blum CB Corp., 11.25% Sr. Unsec. Sub. Nts., 6/15/11(4) 500,000 493,750 - ---------------------------------------------------------------------------------------------------------------------------- D.R. Horton, Inc.: 8% Sr. Nts., 2/1/09 400,000 388,000 9.375% Sr. Unsec. Sub. Nts., 3/15/11 400,000 402,000 9.75% Sr. Sub. Nts., 9/15/10 400,000 410,000 - ---------------------------------------------------------------------------------------------------------------------------- Del Webb Corp., 10.25% Sr. Unsec. Sub. Nts., 2/15/10 300,000 318,000 - ---------------------------------------------------------------------------------------------------------------------------- Formica Corp., 10.875% Sr. Unsec. Sub. Nts., Series B, 3/1/09 200,000 121,000 - ---------------------------------------------------------------------------------------------------------------------------- KB Home: 7.75% Sr. Nts., 10/15/04 300,000 301,500 9.50% Sr. Unsec. Sub. Nts., 2/15/11 400,000 404,000
Oppenheimer Strategic Bond Fund/VA 13 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Housing (continued) Lennar Corp., 9.95% Sr. Unsec. Nts., Series B, 5/1/10 $ 700,000 $ 756,000 - ---------------------------------------------------------------------------------------------------------------------------- Nortek, Inc.: 9.125% Sr. Unsec. Nts., Series B, 9/1/07 650,000 640,250 9.25% Sr. Nts., Series B, 3/15/07 150,000 148,500 9.875% Sr. Sub. Nts., 6/15/11(4) 500,000 483,750 ------------ 4,866,750 - ---------------------------------------------------------------------------------------------------------------------------- Information Technology--1.5% Amkor Technology, Inc.: 9.25% Sr. Nts., 2/15/08(4) 250,000 236,250 9.25% Sr. Unsec. Nts., 5/1/06 700,000 679,000 - ---------------------------------------------------------------------------------------------------------------------------- ASAT Finance LLC, 12.50% Sr. Unsec. Nts., 11/1/06 162,500 151,937 - ---------------------------------------------------------------------------------------------------------------------------- Cherokee International LLC, 10.50% Sr. Unsec. Sub. Nts., Series B, 5/1/09 500,000 380,000 - ---------------------------------------------------------------------------------------------------------------------------- Chippac International Ltd., 12.75% Sr. Unsec. Sub. Nts., Series B, 8/1/09 600,000 586,500 - ---------------------------------------------------------------------------------------------------------------------------- Communications & Power Industries, Inc., 12% Sr. Sub. Nts., Series B, 8/1/05(1) 250,000 128,750 - ---------------------------------------------------------------------------------------------------------------------------- Fairchild Semiconductor Corp.: 10.375% Sr. Unsec. Nts., 10/1/07 500,000 487,500 10.50% Sr. Unsec. Sub. Nts., 2/1/09 300,000 294,000 - ---------------------------------------------------------------------------------------------------------------------------- Fisher Scientific International, Inc., 9% Sr. Unsec. Sub. Nts., 2/1/08 505,000 499,950 - ---------------------------------------------------------------------------------------------------------------------------- Flextronics International Ltd., 9.875% Sr. Unsec. Sub. Nts., 7/1/10 500,000 500,000 - ---------------------------------------------------------------------------------------------------------------------------- Micron Technology, Inc., 6.50% Sub. Nts., 9/30/05 1,000,000 870,000 - ---------------------------------------------------------------------------------------------------------------------------- Seagate Technology International, Inc., 12.50% Sr. Unsec. Sub. Nts., 11/15/07(4) 150,000 149,250 ----------- 4,963,137 - ---------------------------------------------------------------------------------------------------------------------------- Manufacturing--0.9% Actuant Corp., 13% Sr. Sub. Nts., 5/1/09 300,000 304,500 - ---------------------------------------------------------------------------------------------------------------------------- Agco Corp., 9.50% Sr. Unsec. Nts., 5/1/08(4) 800,000 776,000 - ---------------------------------------------------------------------------------------------------------------------------- Blount, Inc., 13% Sr. Sub. Nts., 8/1/09 300,000 174,750 - ---------------------------------------------------------------------------------------------------------------------------- Burke Industries, Inc., 10% Sr. Sub. Nts., 8/15/07(1) 150,000 8,250 - ---------------------------------------------------------------------------------------------------------------------------- Eagle-Picher Industries, Inc., 9.375% Sr. Unsec. Sub. Nts., 3/1/08 300,000 203,250 - ---------------------------------------------------------------------------------------------------------------------------- Grove Worldwide LLC, 9.25% Sr. Sub. Nts., 5/1/08(1)(9)(11) 500,000 12,500 - ---------------------------------------------------------------------------------------------------------------------------- Hydrochem Industrial Services, Inc., 10.375% Sr. Sub. Nts., 8/1/07(1) 150,000 117,750 - ---------------------------------------------------------------------------------------------------------------------------- Insilco Corp., 12% Sr. Sub. Nts., 8/15/07 400,000 190,000 International Wire Group, Inc., 11.75% Sr. Sub. Nts., Series B, 6/1/05 125,000 126,719 - ---------------------------------------------------------------------------------------------------------------------------- Jordan Industries, Inc., 10.375% Sr. Unsec. Nts., Series D, 8/1/07(1) 300,000 262,500 - ---------------------------------------------------------------------------------------------------------------------------- Moll Industries, Inc., 10.50% Sr. Unsec. Sub. Nts., 7/1/08(1) 200,000 71,000 - ---------------------------------------------------------------------------------------------------------------------------- Roller Bearing Co. of America, Inc., 9.625% Sr. Sub. Nts., Series B, 6/15/07 540,000 494,100 - ---------------------------------------------------------------------------------------------------------------------------- Terex Corp.: 8.875% Sr. Unsec. Sub. Nts., 4/1/08 250,000 241,250 8.875% Sr. Unsec. Sub. Nts., Series C, 4/1/08 100,000 96,500 - ---------------------------------------------------------------------------------------------------------------------------- Unifrax Investment Corp., 10.50% Sr. Nts., 11/1/03 50,000 47,750 ------------ 3,126,819 - ---------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Broadcasting--1.2% Chancellor Media Corp., 8.75% Sr. Unsec. Sub. Nts., Series B, 6/15/07 400,000 422,000 - ---------------------------------------------------------------------------------------------------------------------------- Cumulus Media, Inc., 10.375% Sr. Unsec. Sub. Nts., 7/1/08 450,000 450,000
14 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Broadcasting (continued) Emmis Communications Corp., 8.125% Sr. Unsec. Sub. Nts., Series B, 3/15/09 $ 600,000 $ 567,000 - ---------------------------------------------------------------------------------------------------------------------------- Emmis Escrow Corp., 0%/12.50% Sr. Disc. Nts., 3/15/11(4)(12) 800,000 456,000 - ---------------------------------------------------------------------------------------------------------------------------- Paxson Communications Corp., 11.625% Sr. Sub. Nts., 10/1/02 50,000 50,750 - ---------------------------------------------------------------------------------------------------------------------------- Radio One, Inc., 8.875% Sr. Sub Nts., 7/1/11(4) 400,000 402,000 - ---------------------------------------------------------------------------------------------------------------------------- Sinclair Broadcast Group, Inc.: 8.75% Sr. Sub. Nts., 12/15/07 100,000 95,750 9% Sr. Unsec. Sub. Nts., 7/15/07 500,000 485,000 - ---------------------------------------------------------------------------------------------------------------------------- Spanish Broadcasting System, Inc., 9.625% Sr. Sub. Nts., 11/1/09 800,000 748,000 - ---------------------------------------------------------------------------------------------------------------------------- Young Broadcasting, Inc., 8.75% Sr. Sub. Debs., 6/15/07 275,000 257,812 ------------ 3,934,312 - ---------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Cable/Wireless Video--4.0% Adelphia Communications Corp.: 7.875% Sr. Unsec. Nts., 5/1/09 350,000 310,625 8.375% Sr. Nts., Series B, 2/1/08 100,000 92,000 9.25% Sr. Nts., 10/1/02 385,000 387,887 9.375% Sr. Nts., 11/15/09 500,000 480,000 10.25% Sr. Unsec. Sub. Nts., 6/15/11 500,000 495,000 10.50% Sr. Unsec. Nts., Series B, 7/15/04 70,000 70,962 10.875% Sr. Unsec. Nts., 10/1/10 500,000 508,750 - ---------------------------------------------------------------------------------------------------------------------------- Callahan Nordrhein Westfalen, 14.125% Sr. Nts., 7/15/11(4)EUR 500,000 352,397 - ---------------------------------------------------------------------------------------------------------------------------- Charter Communications Holdings LLC/Charter Communications Holdings Capital Corp.: 0%/9.92% Sr. Unsec. Disc. Nts., 4/1/11(12) 1,750,000 1,203,125 8.25% Sr. Unsec. Nts., 4/1/07 400,000 381,000 10% Sr. Nts., 4/1/09 50,000 51,000 10% Sr. Nts., 5/15/11(4) 600,000 612,000 10.75% Sr. Unsec. Nts., 10/1/09 1,500,000 1,586,250 11.125% Sr. Unsec. Nts., 1/15/11 500,000 530,000 - ---------------------------------------------------------------------------------------------------------------------------- Classic Cable, Inc., 10.50% Sr. Sub. Nts., 3/1/10 200,000 59,000 - ---------------------------------------------------------------------------------------------------------------------------- Comcast UK Cable Partner Ltd., 11.20% Sr. Unsec. Disc. Debs., 11/15/07 250,000 171,250 - ---------------------------------------------------------------------------------------------------------------------------- Diamond Cable Communications plc, 11.75% Sr. Disc. Nts., 12/15/05 825,000 565,125 - ---------------------------------------------------------------------------------------------------------------------------- Diamond Holdings plc, 9.125% Sr. Nts., 2/1/08 50,000 31,750 - ---------------------------------------------------------------------------------------------------------------------------- EchoStar Broadband Corp., 10.375% Sr. Unsec. Nts., 10/1/07 900,000 904,500 - ---------------------------------------------------------------------------------------------------------------------------- EchoStar DBS Corp., 9.375% Sr. Unsec. Nts., 2/1/09 1,045,000 1,029,325 - ---------------------------------------------------------------------------------------------------------------------------- EchoStar II Sinking Fund, 8.25% Bonds, 11/9/01(1) 18,056 18,056 - ---------------------------------------------------------------------------------------------------------------------------- Insight Midwest LP/Insight Capital, Inc., 9.75% Sr. Nts., 10/1/09 400,000 416,000 - ---------------------------------------------------------------------------------------------------------------------------- Mediacom LLC/Mediacom Capital Corp., 9.50% Sr. Nts., 1/15/13(4) 450,000 434,250 - ---------------------------------------------------------------------------------------------------------------------------- NTL Communications Corp.: 0%/9.75% Sr. Unsec. Nts., Series B, 4/15/09(12)GBP 775,000 370,586 9.875% Sr. Unsec. Nts., Series B, 11/15/09EUR 200,000 104,555 - ---------------------------------------------------------------------------------------------------------------------------- NTL, Inc.: 0%/9.75% Sr. Deferred Coupon Nts., Series B, 4/1/08(12) 300,000 131,250 0%/10.75% Sr. Unsec. Unsub. Nts., Series B, 4/1/08(12)GBP 115,000 69,546 10% Sr. Nts., Series B, 2/15/07 100,000 65,500 - ---------------------------------------------------------------------------------------------------------------------------- Rogers Cablesystems Ltd., 10% Second Priority Sr. Sec. Debs., 12/1/07 200,000 216,000 - ---------------------------------------------------------------------------------------------------------------------------- Rogers Communications, Inc., 8.75% Sr. Nts., 7/15/07CAD 400,000 257,314
Oppenheimer Strategic Bond Fund/VA 15 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Cable/Wireless Video (continued) Telewest Communications plc: 0%/9.875% Sr. Disc. Nts., 4/15/09(12)GBP 425,000 $ 286,906 11% Sr. Disc. Debs., 10/1/07 200,000 169,500 - ---------------------------------------------------------------------------------------------------------------------------- United International Holdings, Inc., 0%/10.75% Sr. Disc. Nts., Series B, 2/15/08(12) 770,000 261,800 - ---------------------------------------------------------------------------------------------------------------------------- United Pan-Europe Communications NV: 0%/13.375% Sr. Unsec. Disc. Nts., Series B, 11/1/09(12) 500,000 82,500 0%/13.75% Sr. Unsec. Disc. Nts., Series B, 2/1/10(12) 200,000 31,000 10.875% Sr. Nts., 8/1/09EUR 750,000 222,232 11.25% Sr. Nts., Series B, 11/1/09EUR 250,000 73,548 ------------ 13,032,489 - ---------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Diversified Media--0.8% AMC Entertainment, Inc., 9.50% Sr. Unsec. Sub. Nts., 2/1/11 500,000 452,500 - ---------------------------------------------------------------------------------------------------------------------------- IPC Magazines Group plc: 0%/10.75% Bonds, 3/15/08(12)GBP 200,000 206,741 9.625% Bonds, 3/15/08GBP 300,000 383,947 - ---------------------------------------------------------------------------------------------------------------------------- Lamar Advertising Co., 8.625% Sr. Sub. Nts., 9/15/07 150,000 153,750 - ---------------------------------------------------------------------------------------------------------------------------- Lamar Media Corp., 9.625% Sr. Unsec. Sub. Nts., 12/1/06 50,000 52,750 - ---------------------------------------------------------------------------------------------------------------------------- Mail-Well I Corp., 8.75% Sr. Unsec. Sub. Nts., Series B, 12/15/08 600,000 19,000 - ---------------------------------------------------------------------------------------------------------------------------- Penton Media, Inc., 10.375% Sr. Sub. Nts., 6/15/11(4) 300,000 297,000 - ---------------------------------------------------------------------------------------------------------------------------- WRC Media, Inc./Weekly Reader Corp./Compass Learning Corp., 12.75% Sr. Sub. Nts., 11/15/09 800,000 725,000 ------------ 2,790,688 - ---------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Telecommunications--3.3% 360networks, Inc., 13% Sr. Unsec. Nts., 5/1/08(9)EUR 250,000 3,704 - ---------------------------------------------------------------------------------------------------------------------------- Adelphia Business Solutions, Inc., 12% Sr. Sub. Nts., 11/1/07 300,000 139,500 - ---------------------------------------------------------------------------------------------------------------------------- Allegiance Telecom, Inc., 0%/11.75% Sr. Unsec. Disc. Nts., Series B, 2/15/08(12) 600,000 345,000 - ---------------------------------------------------------------------------------------------------------------------------- COLO.com, Inc., 13.875% Sr. Nts., 3/15/10(4)(9)(11) 400,000 59,000 - ---------------------------------------------------------------------------------------------------------------------------- COLT Telecom Group plc: 0%/12% Sr. Unsec. Disc. Nts., 12/15/06(12) 400,000 362,000 7.625% Bonds, 7/31/08DEM 500,000 168,815 10.125% Sr. Nts., 11/30/07GBP 100,000 132,202 - ---------------------------------------------------------------------------------------------------------------------------- Concentric Network Corp., 12.75% Sr. Unsec. Nts., 12/15/07 80,000 24,800 - ---------------------------------------------------------------------------------------------------------------------------- Covad Communications Group, Inc., 0%/13.50% Sr. Disc. Nts., 3/15/08(12) 800,000 68,000 - ---------------------------------------------------------------------------------------------------------------------------- Equinix, Inc., 13% Sr. Unsec. Nts., 12/1/07(1) 200,000 125,000 - ---------------------------------------------------------------------------------------------------------------------------- Exodus Communications, Inc.: 10.75% Sr. Unsec. Sub. Nts., 12/15/09 600,000 207,000 11.25% Sr. Nts., 7/1/08 665,000 232,750 11.625% Sr. Nts., 7/15/10 250,000 87,500 - ---------------------------------------------------------------------------------------------------------------------------- FirstWorld Communications, Inc., 0%/13% Sr. Disc. Nts., 4/15/08(1)(12) 250,000 10,000 - ---------------------------------------------------------------------------------------------------------------------------- FLAG Telecom Holdings Ltd.: 11.625% Sr. Nts., 3/30/10EUR 150,000 83,178 11.625% Sr. Unsec. Nts., 3/30/10 150,000 95,250 - ---------------------------------------------------------------------------------------------------------------------------- Focal Communications Corp.: 0%/12.125% Sr. Unsec. Disc. Nts., 2/15/08(12) 150,000 32,250 11.875% Sr. Unsec. Nts., Series B, 1/15/10 375,000 122,344 - ---------------------------------------------------------------------------------------------------------------------------- Global Crossing Holdings Ltd.: 8.70% Sr. Nts., 8/1/07(4) 700,000 535,500 9.625% Sr. Unsec. Nts., 5/15/08 500,000 397,500
16 Oppenheimer strategic bond fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Telecommunications (continued) Global TeleSystems, Inc., 10.50% Sr. Unsec. Bonds, 12/1/06(9)EUR 250,000 $ 32,277 - ---------------------------------------------------------------------------------------------------------------------------- Globix Corp., 12.50% Sr. Unsec. Nts., 2/1/10 500,000 147,500 - ---------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc.: 0%/11.25% Sr. Disc. Nts., Series B, 7/15/07(12) 300,000 265,500 0%/12.25% Sr. Disc. Nts., Series B, 3/1/09(12) 500,000 367,500 8.875% Sr. Nts., 11/1/07 365,000 359,525 - ---------------------------------------------------------------------------------------------------------------------------- International CableTel, Inc., 0%/11.50% Sr. Deferred Coupon Nts., Series B, 2/1/06 500,000 340,000 - ---------------------------------------------------------------------------------------------------------------------------- Jazztel plc, 13.25% Sr. Unsec. Nts., 12/15/09EUR 800,000 253,980 - ---------------------------------------------------------------------------------------------------------------------------- KMC Telecom Holdings, Inc., 0%/12.50% Sr. Unsec. Disc. Nts., 2/15/08(12) 900,000 81,000 - ---------------------------------------------------------------------------------------------------------------------------- KPNQwest BV, 8.875% Sr. Nts., 2/1/08(4)EUR 800,000 521,506 - ---------------------------------------------------------------------------------------------------------------------------- Level 3 Communications, Inc.: 0%/10.50% Sr. Disc. Nts., 12/1/08(12) 800,000 208,000 9.125% Sr. Unsec. Nts., 5/1/08 500,000 210,000 11% Sr. Unsec. Nts., 3/15/08 550,000 244,750 11.25% Sr. Unsec. Nts., 3/15/10 450,000 193,500 - ---------------------------------------------------------------------------------------------------------------------------- McLeodUSA, Inc.: 8.125% Sr. Unsec. Nts., 2/15/09 600,000 319,500 8.375% Sr. Nts., 3/15/08 513,000 279,585 11.375% Sr. Nts., 1/1/09 500,000 317,500 - ---------------------------------------------------------------------------------------------------------------------------- Metromedia Fiber Network, Inc.: 10% Sr. Nts., 12/15/09 550,000 211,750 10% Sr. Unsec. Nts., Series B, 11/15/08 400,000 154,000 - ---------------------------------------------------------------------------------------------------------------------------- Metromedia International Group, Inc., 10.50% Sr. Unsec. Disc. Nts., 9/30/07(1)(2) 477,966 241,373 - ---------------------------------------------------------------------------------------------------------------------------- MGC Communications, Inc./Mpower Holding Corp., 13% Sr. Unsec. Nts., 4/1/10 300,000 79,500 - ---------------------------------------------------------------------------------------------------------------------------- NorthPoint Communications Group, Inc., 12.875% Nts., 2/15/10(9) 350,000 17,500 - ---------------------------------------------------------------------------------------------------------------------------- Ntelos, Inc., 13% Sr. Nts., 8/15/10(1) 450,000 317,250 - ---------------------------------------------------------------------------------------------------------------------------- OpTel, Inc., 13% Sr. Nts., Series B, 2/15/05(1)(9)(11) 100,000 40,500 - ---------------------------------------------------------------------------------------------------------------------------- PSINet, Inc.: 10.50% Sr. Unsec. Nts., 12/1/06(9)EUR 100,000 3,810 11% Sr. Nts., 8/1/09(9) 300,000 19,500 - ---------------------------------------------------------------------------------------------------------------------------- RCN Corp., 10.125% Sr. Unsec. Nts., 1/15/10 500,000 207,500 - ---------------------------------------------------------------------------------------------------------------------------- Rhythms NetConnections, Inc., 14% Sr. Unsec. Nts., Series B, 2/15/10 500,000 17,500 - ---------------------------------------------------------------------------------------------------------------------------- RSL Communications plc: 0%/10% Bonds, 3/15/08(9)(11)(12)DEM 100,000 649 10.50% Sr. Unsec. Nts., 11/5/08(9)(11) 150,000 4,875 12.875% Sr. Unsec. Nts., 3/1/10(9)(11) 350,000 11,375 - ---------------------------------------------------------------------------------------------------------------------------- Shaw Communications, Inc., 8.54% Debs., 9/30/27CAD 340,000 206,175 - ---------------------------------------------------------------------------------------------------------------------------- Tele1 Europe BV, 11.875% Sr. Nts., 12/1/09EUR 500,000 245,514 - ---------------------------------------------------------------------------------------------------------------------------- Teligent, Inc., 11.50% Sr. Nts., 12/1/07(9) 500,000 3,750 - ---------------------------------------------------------------------------------------------------------------------------- Time Warner Telecom LLC/Time Warner Telecom, Inc., 9.75% Sr. Nts., 7/15/08 100,000 90,250 - ---------------------------------------------------------------------------------------------------------------------------- Time Warner Telecom, Inc., 10.125% Sr. Unsec. Sub. Nts., 2/1/11 600,000 543,000 - ---------------------------------------------------------------------------------------------------------------------------- Viatel, Inc., 11.25% Sr. Sec. Nts., 4/15/08(9) 500,000 15,000 - ---------------------------------------------------------------------------------------------------------------------------- WAM!NET, Inc., 0%/13.25% Sr. Unsec. Disc. Nts., Series B, 3/1/05(1)(12) 750,000 41,250 - ---------------------------------------------------------------------------------------------------------------------------- Williams Communications Group, Inc.: 10.875% Sr. Unsec. Nts., 10/1/09 600,000 246,000 11.875% Sr. Unsec. Nts., 8/1/10 500,000 210,000
Oppenheimer Strategic Bond Fund/VA 17 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Telecommunications (continued) Winstar Communications, Inc., 12.75% Sr. Nts., 4/15/10(9)(11) $ 250,000 $ 3,125 - ---------------------------------------------------------------------------------------------------------------------------- XO Communications, Inc.: 9% Sr. Unsec. Nts., 3/15/08 250,000 71,250 9.625% Sr. Nts., 10/1/07 350,000 103,250 10.75% Sr. Unsec. Nts., 11/15/08 300,000 97,500 10.75% Sr. Unsec. Nts., 6/1/09 500,000 162,500 ------------ 10,738,562 - ---------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Wireless Communications--4.6% Alamosa Delaware, Inc., 12.50% Sr. Nts., 2/1/11(4) 400,000 362,000 - ---------------------------------------------------------------------------------------------------------------------------- American Cellular Corp., 9.50% Sr. Unsec. Sub. Nts., 10/15/09(4) 600,000 567,000 - ---------------------------------------------------------------------------------------------------------------------------- American Tower Corp., 9.375% Sr. Nts., 2/1/09(4) 1,000,000 937,500 - ---------------------------------------------------------------------------------------------------------------------------- CellNet Data Systems, Inc., 0%/14% Sr. Unsec. Disc. Nts., 10/1/07(1)(9)(12) 400,000 500 - ---------------------------------------------------------------------------------------------------------------------------- Crown Castle International Corp.: 0%/10.375% Sr. Disc. Nts., 5/15/11(12) 500,000 313,750 0%/10.625% Sr. Unsec. Disc. Nts., 11/15/07(12) 500,000 392,500 9.375% Sr. Nts., 8/1/11(4) 600,000 544,500 - ---------------------------------------------------------------------------------------------------------------------------- Horizon PCS, Inc., 0%/14% Sr. Unsec. Sub. Nts., 10/1/10(12) 1,000,000 395,000 - ---------------------------------------------------------------------------------------------------------------------------- IPCS, Inc., 0%/14% Sr. Unsec. Disc. Nts., 7/15/10(12) 300,000 123,000 - ---------------------------------------------------------------------------------------------------------------------------- Leap Wireless International, Inc., 12.50% Sr. Nts., 4/15/10 275,000 182,875 - ---------------------------------------------------------------------------------------------------------------------------- Loral Space & Communications Ltd., 9.50% Sr. Nts., 1/15/06 300,000 226,500 - ---------------------------------------------------------------------------------------------------------------------------- Microcell Telecommunications, Inc.: 0%/11.125% Sr. Disc. Nts., Series B, 10/15/07(12)CAD 300,000 109,219 0%/14% Sr. Disc. Nts., Series B, 6/1/06(12) 300,000 223,500 - ---------------------------------------------------------------------------------------------------------------------------- Millicom International Cellular SA, 13.50% Sr. Disc. Nts., 6/1/06 410,000 354,650 - ---------------------------------------------------------------------------------------------------------------------------- Nextel Communications, Inc.: 0%/9.95% Sr. Disc. Nts., 2/15/08(12) 245,000 153,738 0%/10.65% Sr. Disc. Nts., 9/15/07(12) 750,000 531,563 9.375% Sr. Unsec. Nts., 11/15/09 600,000 477,000 - ---------------------------------------------------------------------------------------------------------------------------- Nextel Partners, Inc., 11% Sr. Unsec. Nts., 3/15/10 250,000 197,500 - ---------------------------------------------------------------------------------------------------------------------------- Omnipoint Corp., 11.50% Sr. Nts., 9/15/09(1) 735,000 848,925 - ---------------------------------------------------------------------------------------------------------------------------- ORBCOMM Global LP/ORBCOMM Capital Corp., 14% Sr. Nts., 8/15/04(1)(9)(11) 200,000 3,000 - ---------------------------------------------------------------------------------------------------------------------------- Orion Network Systems, Inc., 0%/12.50% Sr. Disc. Nts., 1/15/07(12) 675,000 246,375 - ---------------------------------------------------------------------------------------------------------------------------- Pinnacle Holdings, Inc., 0%/10% Sr. Unsec. Disc. Nts., 3/15/08(12) 600,000 312,000 - ---------------------------------------------------------------------------------------------------------------------------- Price Communications Wireless, Inc.: 9.125% Sr. Sec. Nts., Series B, 12/15/06 250,000 260,000 11.75% Sr. Sub. Nts., 7/15/07 275,000 295,625 - ---------------------------------------------------------------------------------------------------------------------------- Real Time Data Co., 13% Disc. Nts., 5/31/09(1)(13) 142,981 144,996 - ---------------------------------------------------------------------------------------------------------------------------- Rural Cellular Corp., 9.625% Sr. Sub. Nts., Series B, 5/15/08 300,000 292,500 - ---------------------------------------------------------------------------------------------------------------------------- SBA Communications Corp.: 0%/12% Sr. Unsec. Disc. Nts., 3/1/08(12) 1,200,000 966,000 10.25% Sr. Unsec. Nts., 2/1/09 800,000 736,000 - ---------------------------------------------------------------------------------------------------------------------------- Spectrasite Holdings, Inc.: 0%/12% Sr. Disc. Nts., 7/15/08(12) 500,000 271,250 0%/12.875% Sr. Unsec. Disc. Nts., Series B, 3/15/10(12) 300,000 127,500 - ---------------------------------------------------------------------------------------------------------------------------- Sprint Spectrum LP/Sprint Spectrum Finance Corp., 0%/12.50% Sr. Disc. Nts., 8/15/06(12) 65,000 68,085
18 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Media/Entertainment: Wireless Communications (continued) TeleCorp PCS, Inc.: 0%/11.625% Sr. Unsec. Sub. Disc. Nts., 4/15/09(12) $ 300,000 $ 189,000 10.625% Sr. Unsec. Sub. Nts., 7/15/10 600,000 567,000 - ---------------------------------------------------------------------------------------------------------------------------- Tritel PCS, Inc.: 0%/12.75% Sr. Unsec. Sub. Disc. Nts., 5/15/09(12) 350,000 224,000 10.375% Sr. Sub. Nts., 1/15/11 400,000 368,000 - ---------------------------------------------------------------------------------------------------------------------------- Triton PCS, Inc.: 0%/11% Sr. Unsec. Sub. Disc. Nts., 5/1/08(12) 400,000 324,500 9.375% Sr. Unsec. Sub. Nts., 2/1/11 300,000 292,500 - ---------------------------------------------------------------------------------------------------------------------------- US Unwired, Inc., 0%/13.375% Sr. Unsec. Sub. Disc. Nts., Series B, 11/1/09(12) 900,000 446,625 VoiceStream Wireless Corp., 10.375% Sr. Unsec. Nts., 11/15/09 1,699,000 1,945,355 - ---------------------------------------------------------------------------------------------------------------------------- 15,021,531 ------------ Metals/Minerals--1.2% AK Steel Corp.: 7.875% Sr. Unsec. Nts., 2/15/09 500,000 490,000 9.125% Sr. Nts., 12/15/06 300,000 309,000 - ---------------------------------------------------------------------------------------------------------------------------- Better Minerals & Aggregates Co., 13% Sr. Unsec. Sub. Nts., 9/15/09 400,000 338,000 - ---------------------------------------------------------------------------------------------------------------------------- California Steel Industries Corp., 8.50% Sr. Unsec. Nts., Series B, 4/1/09 200,000 177,000 - ---------------------------------------------------------------------------------------------------------------------------- Centaur Mining & Exploration Ltd., 11% Sr. Nts., 12/1/07(9)(11) 100,000 10,500 - ---------------------------------------------------------------------------------------------------------------------------- Century Aluminum Co., 11.75% Sr. Sec. Nts., 4/15/08(4) 500,000 522,500 - ---------------------------------------------------------------------------------------------------------------------------- Great Lakes Carbon Corp., 10.25% Sr. Sub. Nts., Series B, 5/15/08 500,000 297,500 - ---------------------------------------------------------------------------------------------------------------------------- Kaiser Aluminum & Chemical Corp., 12.75% Sr. Sub. Nts., 2/1/03 1,000,000 895,000 - ---------------------------------------------------------------------------------------------------------------------------- Metallurg Holdings, Inc., 0%/12.75% Sr. Disc. Nts., 7/15/08(12) 300,000 139,500 - ---------------------------------------------------------------------------------------------------------------------------- Metallurg, Inc., 11% Sr. Nts., 12/1/07(1) 500,000 457,500 - ---------------------------------------------------------------------------------------------------------------------------- National Steel Corp., 9.875% First Mtg. Bonds, Series D, 3/1/09 800,000 284,000 ------------ 3,920,500 - ---------------------------------------------------------------------------------------------------------------------------- Retail--0.2% Amazon.com, Inc., 0%/10% Sr. Unsec. Disc. Nts., 5/1/08(12) 500,000 333,750 - ---------------------------------------------------------------------------------------------------------------------------- Eye Care Centers of America, Inc., 9.125% Sr. Unsec. Sub. Nts., 5/1/08 200,000 81,000 - ---------------------------------------------------------------------------------------------------------------------------- Finlay Enterprises, Inc., 9% Debs., 5/1/08 100,000 92,500 - ---------------------------------------------------------------------------------------------------------------------------- Finlay Fine Jewelry Corp., 8.375% Sr. Nts., 5/1/08 100,000 93,500 ------------ 600,750 - ---------------------------------------------------------------------------------------------------------------------------- Service--2.7% Allied Waste North America, Inc.: 7.875% Sr. Unsec. Nts., Series B, 1/1/09 435,000 427,388 8.875% Sr. Sec. Nts., 4/1/08(4) 800,000 825,000 10% Sr. Unsec. Sub. Nts., Series B, 8/1/09 1,700,000 1,755,250 - ---------------------------------------------------------------------------------------------------------------------------- American Plumbing & Mechanical, Inc., 11.625% Sr. Sub. Nts., Series B, 10/15/08 425,000 422,875 - ---------------------------------------------------------------------------------------------------------------------------- AP Holdings, Inc., 0%/11.25% Sr. Disc. Nts., 3/15/08(12) 50,000 3,813 - ---------------------------------------------------------------------------------------------------------------------------- Apcoa, Inc., 9.25% Sr. Unsec. Sub. Nts., 3/15/08(1) 100,000 60,500 - ---------------------------------------------------------------------------------------------------------------------------- Brand Scaffold Service, Inc., 10.25% Sr. Unsec. Nts., 2/15/08 300,000 280,125 - ---------------------------------------------------------------------------------------------------------------------------- Budget Group, Inc., 9.125% Sr. Unsec. Nts., 4/1/06 700,000 283,500 - ---------------------------------------------------------------------------------------------------------------------------- Dyncorp, Inc., 9.50% Sr. Sub. Nts., 3/1/07 350,000 331,625 - ---------------------------------------------------------------------------------------------------------------------------- Great Lakes Dredge & Dock Corp., 11.25% Sr. Unsec. Sub. Nts., 8/15/08 500,000 510,000 - ---------------------------------------------------------------------------------------------------------------------------- Integrated Electrical Services, Inc., 9.375% Sr. Sub. Nts., 2/1/09(4) 700,000 689,500
Oppenheimer Strategic Bond Fund/VA 19 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Service (continued) Iron Mountain, Inc., 8.75% Sr. Sub. Nts., 9/30/09(1) $ 150,000 $ 153,750 - ---------------------------------------------------------------------------------------------------------------------------- IT Group, Inc., 11.25% Sr. Unsec. Sub. Nts., Series B, 4/1/09 200,000 189,000 - ---------------------------------------------------------------------------------------------------------------------------- Key3Media Group, Inc., 11.25% Sr. Sub. Nts., 6/15/11 500,000 492,500 - ---------------------------------------------------------------------------------------------------------------------------- Kindercare Learning Centers, Inc., 9.50% Sr. Sub. Nts., 2/15/09 500,000 497,500 - ---------------------------------------------------------------------------------------------------------------------------- Pentacon, Inc., 12.25% Sr. Unsec. Nts., Series B, 4/1/09(1) 550,000 277,750 - ---------------------------------------------------------------------------------------------------------------------------- Protection One, Inc./Protection One Alarm Monitoring, Inc., 7.375% Sr. Unsec. Nts., 8/15/05 400,000 306,000 - ---------------------------------------------------------------------------------------------------------------------------- Safety-Kleen Corp., 9.25% Sr. Unsec. Nts., 5/15/09(1)(9)(11) 400,000 40 - ---------------------------------------------------------------------------------------------------------------------------- United Rentals, Inc.: 9.25% Sr. Unsec. Sub. Nts., Series B, 1/15/09 400,000 376,000 10.75% Sr. Unsec. Nts., 4/15/08(4) 600,000 624,000 - ---------------------------------------------------------------------------------------------------------------------------- URS Corp., 12.25% Sr. Sub. Nts., Series B, 5/1/09 500,000 513,750 ---------- 9,019,866 - ---------------------------------------------------------------------------------------------------------------------------- Transportation--1.7% America West Airlines, Inc., 10.75% Sr. Nts., 9/1/05 450,000 430,313 - ---------------------------------------------------------------------------------------------------------------------------- Amtran, Inc.: 9.625% Nts., 12/15/05 100,000 85,500 10.50% Sr. Nts., 8/1/04 700,000 619,500 - ---------------------------------------------------------------------------------------------------------------------------- Atlas Air, Inc.: 9.25% Sr. Nts., 4/15/08 100,000 70,500 9.375% Sr. Unsec. Nts., 11/15/06 300,000 217,500 10.75% Sr. Nts., 8/1/05 125,000 98,125 - ---------------------------------------------------------------------------------------------------------------------------- Cambridge Industries, Inc., 10.25% Sr. Sub. Nts., Series B, 7/15/07(1)(9)(11) 75,000 10,125 - ---------------------------------------------------------------------------------------------------------------------------- Collins & Aikman Products Co., 11.50% Sr. Unsec. Sub. Nts., 4/15/06 600,000 570,000 - ---------------------------------------------------------------------------------------------------------------------------- Delco Remy International, Inc., 11% Sr. Sub. Nts., 5/1/09(4) 300,000 313,500 - ---------------------------------------------------------------------------------------------------------------------------- Dura Operating Corp.: 9% Sr. Sub. Nts., 5/1/09(4) 500,000 472,500 9% Sr. Sub. Nts., Series B, 5/1/09EUR 400,000 313,242 - ---------------------------------------------------------------------------------------------------------------------------- Hayes Lemmerz International, Inc., 11.875% Sr. Nts., 6/15/06(4) 600,000 585,000 - ---------------------------------------------------------------------------------------------------------------------------- Hayes Wheels International, Inc., 9.125% Sr. Unsec. Sub. Nts., Series B, 7/15/07 250,000 190,000 - ---------------------------------------------------------------------------------------------------------------------------- Lear Corp., 9.50% Sub. Nts., 7/15/06 200,000 208,500 - ---------------------------------------------------------------------------------------------------------------------------- Millenium Seacarriers, Inc., Units (each unit consists of $1,000 principal amount of 12% first priority ship mtg. sr. sec. nts., 7/15/05 and one warrant to purchase five shares of common stock)(1)(2)(14) 250,000 137,500 Navigator Gas Transport plc, 10.50% First Priority Ship Mtg. Nts., 6/30/07(4) 175,000 97,125 - ---------------------------------------------------------------------------------------------------------------------------- Oxford Automotive, Inc., 10.125% Sr. Unsec. Sub. Nts., Series D, 6/15/07 800,000 492,000 - ---------------------------------------------------------------------------------------------------------------------------- Tenneco, Inc., 11.625% Sr. Unsec. Sub. Nts., Series B, 10/15/09 400,000 206,000 - ---------------------------------------------------------------------------------------------------------------------------- Trans World Airlines, Inc., 11.50% Sr. Sec. Nts., 12/15/04(9)(11) 430,000 432,150 ---------- 5,549,080 - ---------------------------------------------------------------------------------------------------------------------------- Utility--1.2% AES Corp. (The): 8.75% Sr. Unsec. Unsub. Nts., 6/15/08 500,000 493,750 8.875% Sr. Unsec. Nts., 2/15/11 500,000 491,250 - ---------------------------------------------------------------------------------------------------------------------------- AES Drax Energy Ltd., 11.25% Sr. Sec. Bonds, 8/30/10GBP 400,000 617,410 - ---------------------------------------------------------------------------------------------------------------------------- Azurix Corp., 10.75% Sr. Unsec. Nts., Series B, 2/15/10 200,000 207,000 - ---------------------------------------------------------------------------------------------------------------------------- Caithness Coso Funding Corp., 9.05% Sr. Sec. Nts., Series B, 12/15/09 400,000 394,000 - ---------------------------------------------------------------------------------------------------------------------------- Central Termica Guemes SA, 2% Unsec. Unsub. Bonds, 9/26/10(1)(2) 90,000 9,900
20 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Utility (continued) CMS Energy Corp.: 8.50% Sr. Nts., 4/15/11 500,000 $ 486,420 9.875% Sr. Unsec. Nts., 10/15/07 800,000 834,889 - ---------------------------------------------------------------------------------------------------------------------------- El Paso Electric Co., 9.40% First Mtg. Sec. Nts., Series E, 5/1/11 250,000 270,440 Funding Corp./Beaver Valley Funding Corp., 9% Second Lease Obligation Bonds, 6/1/17 199,000 213,266 ------------ 4,018,325 ------------ Total Corporate Bonds and Notes (Cost $162,164,507) 136,509,560 Shares ============================================================================================================================ Preferred Stocks--1.5% - ---------------------------------------------------------------------------------------------------------------------------- AmeriKing, Inc., 13% Cum. Sr. Exchangeable, Non-Vtg.(1)(13) 3,627 36 - ---------------------------------------------------------------------------------------------------------------------------- BankUnited Capital Trust, 10.25% Capital Securities, 12/31/26(1) 100,000 89,250 - ---------------------------------------------------------------------------------------------------------------------------- CGA Group Ltd., Series A, Vtg.(1)(13) 26,794 669,850 - ---------------------------------------------------------------------------------------------------------------------------- Contour Energy Co., $2.625 Cum. Cv., Vtg.(11) 1,800 18,090 - ---------------------------------------------------------------------------------------------------------------------------- CRIIMI MAE, Inc., 10.875% Cum. Cv., Series B, Non-Vtg. 46,000 737,840 - ---------------------------------------------------------------------------------------------------------------------------- Crown American Realty Trust, 11% Cum., Series A, Non-Vtg. 2,000 96,600 - ---------------------------------------------------------------------------------------------------------------------------- Doane Pet Care Co., 14.25% Jr. Sub. Debs., Non-Vtg.(1)(11) 5,000 148,750 - ---------------------------------------------------------------------------------------------------------------------------- Dobson Communications Corp.: 12.25% Sr. Exchangeable, Non-Vtg.(13) 305 275,262 13% Sr. Exchangeable, Non-Vtg.(13) 387 341,527 - ---------------------------------------------------------------------------------------------------------------------------- e.spire Communications, Inc., 12.75% Jr. Redeemable, Non-Vtg.(1)(13) 216 22 - ---------------------------------------------------------------------------------------------------------------------------- Eagle-Picher Holdings, Inc., 11.75% Cum. Exchangeable, Series B, Non-Vtg.(1) 5,000 82,500 - ---------------------------------------------------------------------------------------------------------------------------- Earthwatch, Inc., 12% Cv. Sr., Series C, Non-Vtg.(1) 5,096 2,548 - ---------------------------------------------------------------------------------------------------------------------------- Fidelity Federal Bank, l2% Non-Cum. Exchangeable, Series A, Non-Vtg.(1) 20 505 - ---------------------------------------------------------------------------------------------------------------------------- ICG Holdings, Inc., 14.25% Exchangeable, Non-Vtg.(1)(13) 151 2 - ---------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc., 7% Cv., Series E, Non-Vtg. 2,100 42,787 - ---------------------------------------------------------------------------------------------------------------------------- International Utility Structures, Inc.: 13%(1)(13) 21 8,453 Units (each unit consists of $1,000 principal amount of 13% sr. exchangeable preferred stock and one warrant to purchase 30 shares of common stock)(1)(13)(14) 50 20,125 - ---------------------------------------------------------------------------------------------------------------------------- Nebco Evans Holdings, Inc., 11.25% Sr. Redeemable Exchangeable, Non-Vtg.(1)(11)(13) 6,061 758 - ---------------------------------------------------------------------------------------------------------------------------- Nextel Communications, Inc., 11.125% Exchangeable, Series E, Non-Vtg.(13) 140 84,350 - ---------------------------------------------------------------------------------------------------------------------------- Paxson Communications Corp., 13.25% Cum. Jr. Exchangeable, Non-Vtg.(13) 28 258,300 - ---------------------------------------------------------------------------------------------------------------------------- Premcor USA, Inc., 11.50% Cum. Sr., Non-Vtg.(1)(13) 70 23,275 - ---------------------------------------------------------------------------------------------------------------------------- PRIMEDIA, Inc.: 8.625% Exchangeable, Series H, Non-Vtg. 10,000 762,500 9.20% Exchangeable, Series F, Non-Vtg.(1) 1,000 78,250 - ---------------------------------------------------------------------------------------------------------------------------- Rural Cellular Corp., 11.375% Cum. Sr., Series B, Non-Vtg.(13) 565 470,363 - ---------------------------------------------------------------------------------------------------------------------------- SF Holdings Group, Inc.: 13.75% Exchangeable, Non-Vtg.(1) 3 6,525 13.75% Exchangeable, Series B, Non-Vtg.(1)(13) 10 21,750 - ---------------------------------------------------------------------------------------------------------------------------- Sovereign Real Estate Investment Trust, 12% Non-Cum., Series A(1) 4,600 460,000 - ---------------------------------------------------------------------------------------------------------------------------- XO Communications, Inc.: 13.50% Sr., Series E, Non-Vtg.(13) 295 18,438 14% Cum. Sr. Exchangeable Redeemable, Non-Vtg.(13) 23,391 111,107 ------------ Total Preferred Stocks (Cost $9,136,214) 4,829,763
Oppenheimer Strategic Bond Fund/VA 21 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Market Value Shares See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Common Stocks--0.2% - ----------------------------------------------------------------------------------------------------------------------------- Adelphia Business Solutions, Inc., Cl. B(11) 363 $ 1,488 - ---------------------------------------------------------------------------------------------------------------------------- Aurora Foods, Inc.(1)(11) 5,313 14,558 - ---------------------------------------------------------------------------------------------------------------------------- Celcaribe SA(1)(11) 24,390 39,634 - ---------------------------------------------------------------------------------------------------------------------------- Chesapeake Energy Corp.(1)(11) 20,099 129,840 - ---------------------------------------------------------------------------------------------------------------------------- CRIIMI MAE, Inc. 419,754 260,247 - ---------------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc. (Liquidation Trust Certificates)(1)(11) 90 1 - ---------------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc., Series B (Escrowed)(1)(11) 210 630 - ---------------------------------------------------------------------------------------------------------------------------- ICO Global Communication Holdings Ltd.(11) 6,016 10,227 - ---------------------------------------------------------------------------------------------------------------------------- Intermedia Communications, Inc. 268 3,993 - ---------------------------------------------------------------------------------------------------------------------------- OpTel, Inc., Non-Vtg.(1)(11) 210 2 - ---------------------------------------------------------------------------------------------------------------------------- Premier Holdings Ltd.(1)(11) 18,514 -- - ---------------------------------------------------------------------------------------------------------------------------- Purina Mills, Inc.(11) 4,188 100,512 - ---------------------------------------------------------------------------------------------------------------------------- SF Holdings Group, Inc., Cl. C(1)(11) 370 1,850 - ---------------------------------------------------------------------------------------------------------------------------- Southern Pacific Funding Corp. Liquidating Trust(1)(11) 83,868 -- - ---------------------------------------------------------------------------------------------------------------------------- Star Gas Partners LP 187 3,899 - ---------------------------------------------------------------------------------------------------------------------------- Wilshire Financial Services Group, Inc.(11) 6,273 11,919 - ---------------------------------------------------------------------------------------------------------------------------- WRC Media Corp.(1)(11) 1,082 11 ------------ Total Common Stocks (Cost $576,061) 578,811 Units - ---------------------------------------------------------------------------------------------------------------------------- Rights, Warrants and Certificates--0.5% - ---------------------------------------------------------------------------------------------------------------------------- ASAT Finance LLC Wts., Exp. 11/1/06(1) 250 12,625 - ---------------------------------------------------------------------------------------------------------------------------- CGA Group Ltd. Wts., Exp. 6/16/07(1) 16,000 4,800 - ---------------------------------------------------------------------------------------------------------------------------- Charles River Laboratories International, Inc. Wts., Exp. 10/1/09(1) 350 6,475 - ---------------------------------------------------------------------------------------------------------------------------- Chesapeake Energy Corp. Wts.: Exp. 1/23/03(1) 1,668 -- Exp. 1/23/03(1) 953 -- Exp. 5/1/05(1) 2,181 -- Exp. 9/1/04(1) 2,800 -- - ---------------------------------------------------------------------------------------------------------------------------- COLO.com, Inc. Wts., Exp. 3/15/10(1) 400 4 - ---------------------------------------------------------------------------------------------------------------------------- Comunicacion Celular SA Wts., Exp. 11/15/03(1) 200 4 - ---------------------------------------------------------------------------------------------------------------------------- Concentric Network Corp. Wts., Exp. 12/15/07(1) 100 1,550 - ---------------------------------------------------------------------------------------------------------------------------- Covergent Communications, Inc. Wts., Exp. 4/1/08(1) 400 140 - ---------------------------------------------------------------------------------------------------------------------------- Equinix, Inc. Wts., Exp. 12/1/07(1) 200 4,025 - ---------------------------------------------------------------------------------------------------------------------------- Geotek Communications, Inc. Wts., Exp. 7/15/05(1) 7,500 75 - ---------------------------------------------------------------------------------------------------------------------------- Golden State Bancorp, Inc. Litigation Wts 2,404 3,149 - ---------------------------------------------------------------------------------------------------------------------------- HF Holdings, Inc. Wts., Exp. 9/27/09(1) 530 53 - ---------------------------------------------------------------------------------------------------------------------------- Horizon PCS, Inc. Wts., Exp. 10/1/10(1) 1,000 19,875 - ---------------------------------------------------------------------------------------------------------------------------- ICG Communications, Inc. Wts., Exp. 9/15/05(1) 825 87 - ---------------------------------------------------------------------------------------------------------------------------- ICO Global Communication Holdings Ltd. Wts.: Exp. 5/16/06(1) 1,509 75 Exp. 5/16/06 2 -- - ---------------------------------------------------------------------------------------------------------------------------- In-Flight Phone Corp. Wts., Exp. 8/31/02(1) 200 -- - ---------------------------------------------------------------------------------------------------------------------------- Insilco Corp. Wts., Exp. 8/15/07(1) 270 3
22 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Market Value Units See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Rights, Warrants and Certificates (continued) - ----------------------------------------------------------------------------------------------------------------------------- IPCS, Inc. Wts., Exp. 6/15/10(1) 300 $ 6,150 - ---------------------------------------------------------------------------------------------------------------------------- KMC Telecom Holdings, Inc. Wts., Exp. 4/15/08(1) 725 362 - ---------------------------------------------------------------------------------------------------------------------------- Leap Wireless International, Inc. Wts., Exp. 4/15/10(1) 275 11,033 - ---------------------------------------------------------------------------------------------------------------------------- Long Distance International, Inc. Wts., Exp. 4/13/08(1) 200 2 - ---------------------------------------------------------------------------------------------------------------------------- Loral Space & Communications Ltd. Wts., Exp. 1/15/07(1) 150 2 - ---------------------------------------------------------------------------------------------------------------------------- Mexico Value Rts., Exp. 6/30/03 20,071 192 - ---------------------------------------------------------------------------------------------------------------------------- Microcell Telecommunications, Inc. Wts., Exp. 6/1/06(4) 600 11,700 - ---------------------------------------------------------------------------------------------------------------------------- Millenium Seacarriers, Inc. Wts., Exp. 7/15/05(1) 250 3 - ---------------------------------------------------------------------------------------------------------------------------- Morgan Stanley Dean Witter & Co. Wts., Exp. 6/5/03 163,560 1,585,992 - ---------------------------------------------------------------------------------------------------------------------------- Ntelos, Inc. Wts., Exp. 8/15/10(1) 450 2,306 - ---------------------------------------------------------------------------------------------------------------------------- Occidente y Caribe Celular SA Wts., Exp. 3/15/04(1) 800 8 - ---------------------------------------------------------------------------------------------------------------------------- Pathmark Stores, Inc. Wts., Exp. 9/19/10 5,710 50,134 - ---------------------------------------------------------------------------------------------------------------------------- PLD Telekom, Inc.: Wts., Exp. 6/1/06 (cv. into Metromedia International Group, Inc.)(1) 300 15 14% Sr. Disc. Nts. Wts., Exp. 3/31/03 (cv. into Metromedia International Group, Inc.)(1) 300 3 - ---------------------------------------------------------------------------------------------------------------------------- Real Time Data Co. Wts., Exp. 5/31/04(1) 36,431 364 - ---------------------------------------------------------------------------------------------------------------------------- Republic Technologies International LLC Wts., Exp. 7/15/09(1) 200 2 - ---------------------------------------------------------------------------------------------------------------------------- Telus Corp. Wts., Exp. 9/15/05 269 4,035 - ---------------------------------------------------------------------------------------------------------------------------- Verado Holdings, Inc., Cl. B Wts., Exp. 4/15/08(1) 175 1,313 - ---------------------------------------------------------------------------------------------------------------------------- WAM!NET, Inc. Wts., Exp. 3/1/05(1) 1,500 15 - ---------------------------------------------------------------------------------------------------------------------------- Total Rights, Warrants and Certificates (Cost $1,664,019) 1,726,571 Principal Amount - ----------------------------------------------------------------------------------------------------------------------------- Structured Instruments--1.8% - ----------------------------------------------------------------------------------------------------------------------------- Credit Suisse First Boston Corp. (New York Branch), Russian Obligatzii Federal'nogo Zaima Linked Nts.: Series 27005, 20.055%, 10/9/02(1)(2)RUR 9,307,830 286,449 Series 27005, 20.055%, 10/9/02(1)(2)RUR 277,180 8,530 Series 27006, 20.055%, 1/22/03(1)(2)RUR 5,003,930 151,713 Series 27006, 20.055%, 1/22/03(1)(2)RUR 277,180 8,404 Series 27007, 20.055%, 2/5/03(1)(2)RUR 7,647,050 231,718 Series 27007, 20.055%, 2/5/03(1)(2)RUR 277,180 8,399 Series 27008, 20.055%, 5/21/03(1)(2)RUR 3,315,240 99,047 Series 27008, 20.055%, 5/21/03(1)(2)RUR 277,180 8,281 Series 27009, 20.055%, 6/4/03(1)(2)RUR 3,783,430 113,164 Series 27009, 20.055%, 6/4/03(1)(2)RUR 277,180 8,290 Series 27009, 20.055%, 6/4/03(1)(2)RUR 2,561,555 76,617 Series 27010, 20.055%, 9/17/03(1)(2)RUR 2,047,150 60,641 Series 27010, 20.055%, 9/17/03(1)(2)RUR 277,180 8,211 Series 27011, 20.055%, 10/8/03(1)(2)RUR 3,646,190 104,506 Series 27011, 20.055%, 10/8/03(1)(2)RUR 277,180 7,944 Series 28001, 20.055%, 1/21/04(1)(2)RUR 277,180 7,839 - ---------------------------------------------------------------------------------------------------------------------------- Deutsche Bank AG, South Korean Won Linked Nts.: 5.60%, 5/9/02KRW 1,723,680,000 1,319,699 5.60%, 5/9/02KRW 426,400,000 326,497 - ---------------------------------------------------------------------------------------------------------------------------- ING Barings LLC, Zero Coupon Russian Equity Linked Nts., 4/19/02 3,600 263,484
Oppenheimer Strategic Bond Fund/VA 23 - -------------------------------------------------------------------------------- Statement of Investments (Unaudited) (Continued) - --------------------------------------------------------------------------------
Principal Market Value Amount See Note 1 - ----------------------------------------------------------------------------------------------------------------------------- Structured Instruments (continued) - ----------------------------------------------------------------------------------------------------------------------------- Russia (Government of) Federal Loan Obligatzii Federal'nogo Zaima Bonds, - ----------------------------------------------------------------------------------------------------------------------------- Series 27010, 20.055%, 9/17/03(1)(2)RUR 3,590,420 $ 106,356 - ---------------------------------------------------------------------------------------------------------------------------- Standard Chartered Bank, Philippines Peso/New Taiwan Dollar Linked Nts., 9.28%, 1/14/02 405,000 416,684 - ---------------------------------------------------------------------------------------------------------------------------- Standard Chartered Bank, Philippines Peso/Thailand Baht Linked Nts., 8.40%, 10/5/01 405,000 409,888 - ---------------------------------------------------------------------------------------------------------------------------- Standard Chartered Bank, South Korean Won Linked Nts., 5.48%, 5/28/02KRW 2,527,510,000 1,938,516 Total Structured Instruments (Cost $5,889,754) 5,970,877
Date Strike Contracts - ----------------------------------------------------------------------------------------------------------------------------- Options Purchased--0.0% - ----------------------------------------------------------------------------------------------------------------------------- Japanese Yen Call(1) (Cost $11,573) 8/1/01 124.35JPY 123,000,000 11,572 - ----------------------------------------------------------------------------------------------------------------------------- Total Investments, at Value (Cost $465,673,390) 131.9% 433,776,367 - ----------------------------------------------------------------------------------------------------------------------------- Liabilities in Excess of Other Assets (31.9) (104,919,887) ----- ------------- Net Assets 100.0% $ 328,856,480 ===== =============
Principal amount is reported in U.S. Dollars, except for those denoted in the following currencies: ARP -- Argentine Peso JPY -- Japanese Yen CAD -- Canadian Dollar KRW -- South Korean Won DEM -- German Mark NOK -- Norwegian Krone EUR -- Euro PLZ -- Polish Zloty FRF -- French Franc RUR -- Russian Ruble GBP -- British Pound Sterling ZAR -- South African Rand HUF -- Hungarian Forint (1) Identifies issues considered to be illiquid or restricted--See Note 8 of Notes to Financial Statements. (2) Represents the current interest rate for a variable or increasing rate security. (3) When-issued security to be delivered and settled after June 30, 2001. (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 $33,705,811 or 10.25% of the Fund's net assets as of June 30, 2001. (5) Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans. These securities typically decline in price as interest rates decline. Most other fixed income securities increase in price when interest rates decline. The principal amount of the underlying pool represents the notional amount on which current interest is calculated. The price of these securities is typically more sensitive to changes in prepayment rates than traditional mortgage-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. (6) Securities with an aggregate market value of $517,001 are held in collateralized accounts to cover initial margin requirements on open futures sales contracts. See Note 6 of Notes to Financial Statements. (7) A sufficient amount of securities has been designated to cover outstanding foreign currency contracts. See Note 5 of Notes to Financial Statements. (8) Zero coupon bond reflects the effective yield on the date of purchase. (9) Issuer is in default. (10) A sufficient amount of liquid assets has been designated to cover outstanding written options, as follows:
Contracts (000s) Expiration Exercise Premium Market Value Subject to Call Date Price Received See Note 1 - ----------------------------------------------------------------------------------------------------------------------- Russian Federation Unsub. Bonds, 8.25%, 3/31/10 Call 1,260 9/4/01 76.75% $18,900 $18,900
(11) Non-income-producing security. (12) Denotes a step bond: a zero coupon bond that converts to a fixed or variable interest rate at a designated future date. (13) Interest or dividend is paid in kind. (14) Units may be comprised of several components, such as debt and equity and/or warrants to purchase equity at some point in the future. For units which represent debt securities, principal amount disclosed represents total underlying principal. See accompanying Notes to Financial Statements. 24 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statement of Assets and Liabilities June 30, 2001 (Unaudited) - --------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------- Assets - ---------------------------------------------------------------------------------------------------------------- Investments, at value (cost $465,673,390)--see accompanying statement $433,776,367 - ---------------------------------------------------------------------------------------------------------------- Cash 3,471,345 - ---------------------------------------------------------------------------------------------------------------- Cash--foreign currencies (cost $213,192) 212,452 - ---------------------------------------------------------------------------------------------------------------- Unrealized appreciation on foreign currency contracts 254,726 - ---------------------------------------------------------------------------------------------------------------- Receivables and other assets: Investments sold (including $14,305,788 sold on a when-issued basis) 22,385,425 Interest, dividends and principal paydowns 6,319,858 Shares of beneficial interest sold 594,264 Closed foreign currency contracts 45,061 Other 3,086 ------------ Total assets 467,062,584 ================================================================================================================ Liabilities Unrealized depreciation on foreign currency contracts 25,970 - ---------------------------------------------------------------------------------------------------------------- Options written, at value (premiums received $18,900)--see accompanying statement 18,900 - ---------------------------------------------------------------------------------------------------------------- Payables and other liabilities: Investments purchased (including $132,999,272 purchased on a when-issued basis) 137,938,628 Shares of beneficial interest redeemed 153,927 Shareholder reports 26,437 Daily variation on futures contracts 25,388 Trustees' compensation 3 Other 16,851 ------------ Total liabilities 138,206,104 ================================================================================================================ Net Assets $328,856,480 ================================================================================================================ Composition of Net Assets Par value of shares of beneficial interest $ 73,670 - ---------------------------------------------------------------------------------------------------------------- Additional paid-in capital 365,308,437 - ---------------------------------------------------------------------------------------------------------------- Undistributed (overdistributed) net investment income (7,019,219) - ---------------------------------------------------------------------------------------------------------------- Accumulated net realized gain (loss) on investments and foreign currency transactions 2,149,021 - ---------------------------------------------------------------------------------------------------------------- Net unrealized appreciation (depreciation) on investments and translation of assets and liabilities denominated in foreign currencies (31,655,429) ------------ ================================================================================================================ Net Assets $328,856,480 ================================================================================================================ Net Asset Value Per Share Non-Service shares: Net asset value, redemption price per share and offering price per share (based on net assets of $328,855,385 and 73,669,538 shares of beneficial interest outstanding) $4.46 - ---------------------------------------------------------------------------------------------------------------- Service shares: Net asset value, redemption price per share and offering price per share (based on net assets of $1,095 and 239 shares of beneficial interest outstanding) $4.58
See accompanying Notes to Financial Statements. Oppenheimer Strategic Bond Fund/VA 25 - -------------------------------------------------------------------------------- Statement of Operations For the Six Months Ended June 30, 2001 (Unaudited) - -------------------------------------------------------------------------------- Investment Income Interest $ 14,422,493 - ---------------------------------------------------------------------------------------------------------------- Dividends 577,943 ------------ Total income 15,000,436 ================================================================================================================ Expenses Management fees 1,182,183 - ---------------------------------------------------------------------------------------------------------------- Shareholder reports 59,641 - ---------------------------------------------------------------------------------------------------------------- Custodian fees and expenses 21,037 - ---------------------------------------------------------------------------------------------------------------- Trustees' compensation 3,601 - ---------------------------------------------------------------------------------------------------------------- Transfer and shareholder servicing agent fees 2,283 - ---------------------------------------------------------------------------------------------------------------- Other 20,347 ------------ Total expenses 1,289,092 Less reduction to custodian expenses (7,881) ------------ Net expenses 1,281,211 ================================================================================================================ Net Investment Income 13,719,225 ================================================================================================================ Realized and Unrealized Gain (Loss) Net realized gain (loss) on: Investments (including premiums on options exercised) (6,299,179) Closing of futures contracts 248,868 Closing and expiration of option contracts written 75,482 Foreign currency transactions (839,377) ------------ Net realized gain (loss) (6,814,206) - ---------------------------------------------------------------------------------------------------------------- Net change in unrealized appreciation (depreciation) on: Investments (1,197,218) Translation of assets and liabilities denominated in foreign currencies (2,191,632) ----------- Net change (3,388,850) Net realized and unrealized gain (loss) (10,203,056) ================================================================================================================ Net Increase in Net Assets Resulting from Operations $ 3,516,169 ============
See accompanying Notes to Financial Statements. 26 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Statements of Changes in Net Assets - --------------------------------------------------------------------------------
Six Months Ended Year Ended June 30,2001 December 31, (Unaudited) 2000 =================================================================================================================================== Operations Net investment income (loss) $ 13,719,225 $ 26,767,119 - ----------------------------------------------------------------------------------------------------------------------------------- Net realized gain (loss) (6,814,206) (8,600,790) - ----------------------------------------------------------------------------------------------------------------------------------- Net change in unrealized appreciation (depreciation) (3,388,850) (10,560,691) ------------- ------------ Net increase (decrease) in net assets resulting from operations 3,516,169 7,605,638 =================================================================================================================================== Dividends and/or Distributions to Shareholders Dividends from net investment income: Non-Service shares (20,045,483) (23,001,014) Service shares -- -- =================================================================================================================================== Beneficial Interest Transactions Net increase (decrease) in net assets resulting from beneficial interest transactions: Non-Service shares 40,823,056 37,871,384 Service shares 1,112 -- =================================================================================================================================== Net Assets Total increase (decrease) 24,294,854 22,476,008 - ----------------------------------------------------------------------------------------------------------------------------------- Beginning of period 304,561,626 282,085,618 ------------ ------------ End of period [including undistributed (overdistributed) net investment income of $(7,019,219) and $(692,961), respectively] $328,856,480 $304,561,626 ============ ============
See accompanying Notes to Financial Statements. Oppenheimer Strategic Bond Fund/VA 27 - -------------------------------------------------------------------------------- Financial Highlights - --------------------------------------------------------------------------------
Six Months Ended June 30, 2001 Year Ended December 31, Non-Service shares (Unaudited) 2000 1999 1998 1997 1996 - ------------------------------------------------------------------------------------------------------------------------------- Per Share Operating Data Net asset value, beginning of period $4.69 $4.97 $5.12 $5.12 $5.09 $4.91 - ------------------------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income .03 .41 .45 .39 .39 .38 Net realized and unrealized gain (loss) (.15) (.28) (.31) (.24) .04 .19 - ------------------------------------------------------------------------------------------------------------------------------- Total income (loss) from investment operations (.12) .13 .14 .15 .43 .57 Dividends and/or distributions to shareholders: Dividends from net investment income (.11) (.41) (.29) (.09) (.39) (.39) Distributions from net realized gain -- -- -- (.06) (.01) -- - ------------------------------------------------------------------------------------------------------------------------------- Total dividends and/or distributions to shareholders (.11) (.41) (.29) (.15) (.40) (.39) - ------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $4.46 $4.69 $4.97 $5.12 $5.12 $5.09 - ------------------------------------------------------------------------------------------------------------------------------- Total Return, at Net Asset Value(1) 1.22% 2.63% 2.83% 2.90% 8.71% 12.07% - ------------------------------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (in thousands) $328,855 $304,562 $282,086 $279,200 $207,839 $118,716 - ------------------------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $322,905 $289,923 $278,668 $250,227 $159,934 $ 82,604 Ratios to average net assets:(2) Net investment income 8.57% 9.23% 9.08% 8.17% 8.23% 8.48% Expenses 0.80% 0.79% 0.78% 0.80%(3) 0.83%(3) 0.85%(3) - ------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 114% 104% 81% 134% 150% 144%
(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 reflects the reduction to custodian expenses. See accompanying Notes to Financial Statements. 28 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Financial Highlights (Continued) - -------------------------------------------------------------------------------- Period Ended June 30, 2001(1) Service shares (Unaudited) ============================================================================== Per Share Operating Data Net asset value, beginning of period $4.64 - ------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income .13 Net realized and unrealized gain (loss) (.19) - ------------------------------------------------------------------------------ Total income (loss) from investment operations (.06) - ------------------------------------------------------------------------------ Dividends and/or distributions to shareholders: Dividends from net investment income -- Distributions from net realized gain -- - ------------------------------------------------------------------------------ Total dividends and/or distributions to shareholders -- - ------------------------------------------------------------------------------ Net asset value, end of period $4.58 ============================================================================== Total Return, at Net Asset Value(2) (1.29)% ============================================================================== Ratios/Supplemental Data Net assets, end of period (in thousands) $ 1 - ------------------------------------------------------------------------------ Average net assets (in thousands) $ 1 Ratios to average net assets:(3) Net investment income 9.68% Expenses 0.80% - ------------------------------------------------------------------------------ Portfolio turnover rate 114% (1) For the period from March 19, 2001 (inception of offering) to June 30, 2001. (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. Oppenheimer Strategic Bond Fund/VA 29 - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) - -------------------------------------------------------------------------------- ================================================================================ 1. Significant Accounting Policies Oppenheimer Strategic Bond Fund/VA (the Fund) is a separate series of Oppenheimer Variable Account Funds (the Trust), an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Fund's investment objective is to seek a high level of current income principally derived from interest on 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). - -------------------------------------------------------------------------------- Structured Notes. The Fund invests in foreign currency-linked structured notes whose market values and redemption prices are linked to foreign currency exchange rates. The structured notes are leveraged, which increases the volatility of each note's market value relative to the change in the underlying foreign currency exchange rate. Fluctuations in value of these securities are recorded as unrealized gains and losses in the accompanying financial statements. The Fund records a realized gain or loss when a structured note is sold or matures. As of June 30, 2001, the market value of these securities comprised 1.8% of the Fund's net assets and resulted in unrealized gains in the current period of $81,123. The Fund also hedges a portion of the foreign currency exposure generated by these securities, as discussed in Note 5. - -------------------------------------------------------------------------------- Securities Purchased on a When-Issued or Forward Commitment Basis. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis can take place a month or more after the trade date. Normally the settlement date occurs within six months after the trade date; however, the Fund may, from time to time, purchase securities whose settlement date extends beyond six months or more beyond trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The Fund maintains segregated assets with a market value equal to or greater than the amount of its purchase commitments. The purchase of securities on a when-issued or forward commitment basis may increase the volatility of the Fund's net asset value to the extent the Fund makes such purchases while remaining substantially fully invested. As of June 30, 2001, the Fund had entered into net outstanding when-issued or forward commitments of $118,693,484. In connection with its ability to purchase securities on a when-issued basis, the Fund may enter into mortgage dollar-rolls in which the Fund sells securities for delivery in the current month and simultaneously contracts with the same counterparty to repurchase similar (same type, coupon and maturity) but not identical securities on a specified future date. The Fund records each dollar-roll as a sale and a new purchase transaction. - -------------------------------------------------------------------------------- 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, 2001, securities with an aggregate market value of $1,799,656, representing 0.55% of the Fund's net assets, were in default. 30 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) (Continued) - -------------------------------------------------------------------------------- ================================================================================ 1. Significant Accounting Policies (continued) 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 its custodian bank 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 June 30, 2001, the Fund had available for federal income tax purposes an estimated unused capital loss carryover of $289,397. This estimated capital loss carryover represents losses deferred under tax accounting rules to the current fiscal year and increased or decreased by capital losses or gains realized in the first six months of the current fiscal year. - -------------------------------------------------------------------------------- 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 paydown gains and losses and 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 their ultimate characterization for federal income tax purposes. Also, due to timing of dividends and distributions, the fiscal year in which amounts are distributed may differ from the fiscal year in which the income or realized gain was recorded by the Fund. - -------------------------------------------------------------------------------- Investment Income. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income, which includes accretion of discount and amortization of premium, is accrued as earned. - -------------------------------------------------------------------------------- Security Transactions. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Oppenheimer Strategic Bond Fund/VA 31 - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) (Continued) - -------------------------------------------------------------------------------- ================================================================================ 1. Significant Accounting Policies (continued) Other. The Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies, as revised, effective for fiscal years beginning after December 15, 2000. As required, the Fund began amortizing premiums on debt securities effective January 1, 2001. Prior to this date, the Fund did not amortize premiums on debt securities. The cumulative effect of this accounting change had no impact on the total net assets of the Fund, but resulted in a $613,110 decrease to cost of securities and a corresponding $613,110 decrease in net unrealized depreciation, based on securities held as of December 31, 2000. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of 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:
Six Months Ended June 30, 2001(1) Year Ended December 31, 2000 --------------------------------- -------------------------------- Shares Amount Shares Amount - ----------------------------------------------------------------------------------------------------------------------------- Non-Service shares Sold 11,335,595 $ 53,283,377 20,188,925 $ 95,290,874 Dividends and/or distributions reinvested 4,374,281 20,045,456 4,957,115 23,001,014 Redeemed (6,948,614) (32,505,777) (16,965,820) (80,420,504) ---------- ------------ ----------- ------------ Net increase (decrease) 8,761,262 $ 40,823,056 8,180,220 $ 37,871,384 ========== ============ =========== ============ Service shares Sold 239 $ 1,112 -- $ -- Dividends and/or distributions reinvested -- -- -- -- Redeemed -- -- -- -- ---------- ------------ ----------- ------------ Net increase (decrease) 239 $ 1,112 -- $ -- ========== ============ =========== ============
(1) Service shares are for the period from March 19, 2001 (inception of offering) to June 30, 2001. ================================================================================ 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, 2001, were $282,761,510 and $217,296,148, 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, 0.60% of the next $200 million and 0.50% of average annual net assets over $1 billion. The Fund's management fee for the six months ended June 30, 2001, was an annualized rate of 0.74%. - -------------------------------------------------------------------------------- Transfer Agent Fees. OppenheimerFunds Services (OFS), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. The Fund pays OFS an agreed upon per account fee. 32 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) (Continued) - -------------------------------------------------------------------------------- ================================================================================ 4. Fees and Other Transactions with Affiliates (continued) 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. 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 as a receivable or payable and in the Statement of Operations with the change in unrealized appreciation or depreciation. The Fund may realize a gain or loss upon the closing or settlement of the foreign currency transactions. Such realized gains and losses are reported with all other foreign currency gains and losses in the Statement of Operations. As of June 30, 2001, the Fund had outstanding foreign currency contracts as follows:
Expiration Contract Valuation as of Unrealized Unrealized Contract Description Dates Amount (000s) June 30, 2001 Appreciation Depreciation - ------------------------------------------------------------------------------------------------------------------------------- Contracts to Purchase - ----------------------- Australian Dollar (AUD) 7/25/01 1,505 AUD $ 764,101 $ -- $12,479 Euro (EUR) 7/5/01 1,345 EUR 1,138,558 -- 6,006 -------- ------- -- 18,485 -------- ------- Contracts to Sell - ------------------------ British Pound Sterling (GBP) 11/21/01 2,530 GBP 3,538,326 61,712 -- Canadian Dollar (CAD) 7/23/01 1,185 CAD 780,511 -- 7,391 Euro (EUR) 7/3/01-8/17/01 5,872 EUR 4,966,844 121,238 94 Japanese Yen (JPY) 9/10/01-12/17/01 207,405 JPY 1,682,924 70,096 -- Norwegian Krone (NOK) 7/5/0 11,240 NOK 1,203,365 1,680 -- -------- ------- 254,726 7,485 -------- ------- Total Unrealized Appreciation and Depreciation $254,726 $25,970 ======== =======
- -------------------------------------------------------------------------------- 6. Futures Contracts A futures contract is a commitment to buy or sell a specific amount of a commodity or financial instrument at a particular price on a stipulated future date at a negotiated price. Futures contracts are traded on a commodity exchange. The Fund may buy and sell futures contracts that relate to broadly based securities indices "financial futures" or debt securities "interest rate futures" in order to gain exposure to or to seek to protect against changes in market value of stock and bonds or interest rates. The Fund may also buy or write put or call options on these futures contracts. Oppenheimer Strategic Bond Fund/VA 33 - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) (Continued) - -------------------------------------------------------------------------------- ================================================================================ 6. Futures Contracts (continued) The Fund generally sells futures contracts to hedge against increases in interest rates and decreases in market value of portfolio securities. The Fund may also purchase futures contracts to gain exposure to market changes as it may be more efficient or cost effective than actually buying fixed income securities. Upon entering into a futures contract, the Fund is required to deposit either cash or securities (initial margin) in an amount equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the Fund each day. The variation margin payments are equal to the daily changes in the contract value and are recorded as unrealized gains and losses. The Fund recognizes a realized gain or loss when the contract is closed or expires. Securities held in collateralized accounts to cover initial margin requirements on open futures contracts are noted in the Statement of Investments. The Statement of Assets and Liabilities reflects a receivable and/or payable for the daily mark to market for variation margin. Realized gains and losses are reported on the Statement of Operations as closing and expiration of futures contracts. Risks of entering into futures contracts (and related options) include the possibility that there may be an illiquid market and that a change in the value of the contract or option may not correlate with changes in the value of the underlying securities. As of June 30, 2001, the Fund had outstanding futures contracts as follows:
Unrealized Expiration Number of Valuation as of Appreciation Contract Description Dates Contracts June 30, 2001 (Depreciation) - ------------------------------------------------------------------------------------------------- Contracts to Purchase - ------------------------- Euro-Bundesobligation 9/6/01 12 $1,082,056 $(9,143) Euro-Schatz 9/6/01 65 5,664,685 9,905 U.S. Long Bond 9/19/01 5 501,563 7,852 U.S. Treasury Nts., 10 yr. 9/19/01 20 2,060,313 6,875 ------- 15,489 ------- Contracts to Sell - ------------------------- U.S. Treasury Nts., 5 yr. 9/19/01 22 2,273,563 13,938 ------- $29,427 =======
================================================================================ 7. 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. 34 Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- Notes to Financial Statements (Unaudited) (Continued) - -------------------------------------------------------------------------------- ================================================================================ 7.Option Activity (continued) 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. Written option activity for the six months ended June 30, 2001, was as follows:
Call Options Put Options ---------------------------------- -------------------------------- Number of Amount of Number of Amount of Contracts (000s) Premiums Contracts (000s) Premiums - ------------------------------------------------------------------------------------------------------- Options outstanding as of December 31, 2000 275 $ 8,524 872 $ 41,018 Options written 5,060 61,200 350,680 31,733 Options closed or expired (1,540) (24,220) (351,552) (72,751) Options exercised (2,535) (26,604) -- -- ------ -------- -------- -------- Options outstanding as of June 30, 2001 1,260 $ 18,900 -- $ -- ===== ======== ======== ========
================================================================================ 8. Illiquid and Restricted Securities and Foreign Currencies As of June 30, 2001, investments in securities and foreign currencies 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 or foreign currency 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 or country restrictions exist that limit or prohibit repatriation. 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 and foreign currencies. Certain restricted securities, eligible for resale to qualified institutional investors, are not subject to that limitation. The aggregate value of illiquid or restricted securities and foreign currencies subject to this limitation as of June 30, 2001, was $20,451,088, which represents 6.22% of the Fund's net assets, of which $820,042 is considered restricted. Information concerning restricted securities and foreign currencies is as follows:
Valuation Per Unrealized Acquisition Cost Unit as of Appreciation Security Dates Per Unit June 30, 2001 (Depreciation) - ---------------------------------------------------------------------------------------------------------------------------- Stocks and Warrants - ------------------------ Aurora Foods, Inc. 9/18/00 $ 0.00 $ 2.74 $ 14,558 CGA Group Ltd. Wts., Exp. 6/16/07 6/17/97 0.00 0.30 4,800 CGA Group Ltd., Series A, Vtg. 6/17/97- 10/4/00 25.00 25.00 -- Chesapeake Energy Corp. 6/27/00 7.45 6.46 (19,884) Geotek Communications, Inc. 4/6/00 0.00 0.01 1 Geotek Communications, Inc., Series B 1/4/01 4.00 3.00 (210) Real Time Data Co. Wts., Exp. 5/31/04 6/30/99 0.01 0.01 -- Currency - ------------------------- Russian Ruble 3/14/01- 6/20/01 0.03 -- --
Oppenheimer Strategic Bond Fund/VA 35 - -------------------------------------------------------------------------------- Oppenheimer Strategic Bond Fund/VA - -------------------------------------------------------------------------------- A Series of Oppenheimer Variable Account Funds ================================================================================ Officers and Trustees James C. Swain, Trustee, CEO 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 C. Howard Kast, Trustee Robert M. Kirchner, Trustee F. William Marshall, Jr., Trustee David P. Negri, Vice President Arthur P. Steinmetz, 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. For more complete information about Oppenheimer Strategic Bond Fund/VA, please refer to the Prospectus. To obtain a copy, call your financial advisor, or call OppenheimerFunds, Inc. at 1.800.981.2871. (C)Copyright 2001 OppenheimerFunds, Inc. All rights reserved. 36 Oppenheimer Strategic Bond Fund/VA -----END PRIVACY-ENHANCED MESSAGE-----