-----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, VRpQVe3HWAln5eBDV1wFhHao7nn7yZ/N/xLIxG/unFTGrYmYds+BwZITcuF/1JJF URGPJbjgrVigRhm6WQOxmg== 0000935069-08-002315.txt : 20080924 0000935069-08-002315.hdr.sgml : 20080924 20080924171637 ACCESSION NUMBER: 0000935069-08-002315 CONFORMED SUBMISSION TYPE: N-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20080731 FILED AS OF DATE: 20080924 DATE AS OF CHANGE: 20080924 EFFECTIVENESS DATE: 20080924 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER EQUITY INCOME FUND INC CENTRAL INDEX KEY: 0000799029 IRS NUMBER: 132527171 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-Q SEC ACT: 1940 Act SEC FILE NUMBER: 811-04797 FILM NUMBER: 081087115 BUSINESS ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY STREET 2: N/A CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 BUSINESS PHONE: 303-768-3200 MAIL ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY STREET 2: N/A CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER QUEST CAPITAL VALUE FUND INC DATE OF NAME CHANGE: 19970303 FORMER COMPANY: FORMER CONFORMED NAME: QUEST FOR VALUE DUAL PURPOSE FUND INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: QFV DUAL PURPOSE FUND INC DATE OF NAME CHANGE: 19870111 0000799029 S000008498 OPPENHEIMER QUEST CAPITAL VALUE FUND INC C000023330 A C000023331 B C000031353 C C000031354 N N-Q 1 rq835_49379nq.txt RQ835_49379NQ.TXT UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act file number 811-04797 --------- Oppenheimer Equity Income Fund, Inc. ------------------------------------ (Exact name of registrant as specified in charter) 6803 South Tucson Way, Centennial, Colorado 80112-3924 ------------------------------------------------------ (Address of principal executive offices) (Zip code) Robert G. Zack, Esq. OppenheimerFunds, Inc. Two World Financial Center, New York, New York 10281-1008 --------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: (303) 768-3200 -------------- Date of fiscal year end: October 31 ---------- Date of reporting period: 07/31/2008 ---------- ITEM 1. SCHEDULE OF INVESTMENTS. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED
SHARES VALUE ------- ------------ COMMON STOCKS--96.8% CONSUMER DISCRETIONARY--4.0% HOTELS, RESTAURANTS & LEISURE--0.3% Carnival Corp.(1) 29,000 $ 1,071,260 MEDIA--2.8% Cinemark Holdings, Inc.(2) 290,000 4,251,400 Comcast Corp., Cl. A Special, Non-Vtg. 52,750 1,083,485 Time Warner, Inc. 350,000 5,012,000 ------------ 10,346,885 ------------ SPECIALTY RETAIL--0.9% OfficeMax, Inc. 250,000 3,190,000 CONSUMER STAPLES--13.7% BEVERAGES--0.9% Coca-Cola Co. (The) 64,500 3,321,750 FOOD & STAPLES RETAILING--0.6% SUPERVALU, Inc. 85,000 2,177,700 FOOD PRODUCTS--1.5% B&G Foods, Inc. 328,750 5,332,325 TOBACCO--10.7% Altria Group, Inc. 290,000 5,901,500 Lorillard, Inc. 265,000 17,784,150 Philip Morris International, Inc. 295,000 15,236,750 ------------ 38,922,400 ------------ ENERGY--21.4% ENERGY EQUIPMENT & SERVICES--2.4% Halliburton Co. 80,000 3,585,600 Transocean, Inc. 36,350 4,944,691 ------------ 8,530,291 ------------ OIL, GAS & CONSUMABLE FUELS--19.0% BP plc, ADR(2) 167,500 10,291,200 Capital Product Partners LP 126,000 2,143,260 Chevron Corp. 100,000 8,456,000 ConocoPhillips 175,000 14,283,500 Kinder Morgan Management LLC(3) 346,000 18,998,860 Marathon Oil Corp. 217,000 10,734,990 Williams Cos., Inc. (The) 125,000 4,006,250 ------------ 68,914,060 ------------ FINANCIALS--16.4% CAPITAL MARKETS--2.4% Bank of New York Mellon Corp. 37,500 1,331,250 Credit Suisse Group AG, ADR(1) 20,000 997,600 UBS AG 325,000 6,275,750 ------------ 8,604,600 ------------ COMMERCIAL BANKS--0.4% Wachovia Corp.(1,2) 75,000 1,295,250 DIVERSIFIED FINANCIAL SERVICES--3.6% Citigroup, Inc. 425,000 7,943,250
1 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED
SHARES VALUE ------- ------------ DIVERSIFIED FINANCIAL SERVICES CONTINUED KKR Financial Holdings LLC 500,000 $ 5,135,000 ------------ 13,078,250 ------------ INSURANCE--9.1% ACE Ltd. 100,000 5,070,000 Everest Re Group Ltd. 225,000 18,405,000 Fidelity National Title Group, Inc., Cl. A 155,000 2,070,800 Hartford Financial Services Group, Inc. (The) 65,000 4,120,350 XL Capital Ltd., Cl. A 189,500 3,390,155 ------------ 33,056,305 ------------ REAL ESTATE INVESTMENT TRUSTS--0.9% Anthracite Capital, Inc.(2) 175,000 1,106,000 Crystal River Capital, Inc.(2) 173,400 508,062 iStar Financial, Inc.(2) 212,600 1,745,446 ------------ 3,359,508 ------------ HEALTH CARE--6.7% PHARMACEUTICALS--6.7% Abbott Laboratories(1) 62,500 3,521,250 Bristol-Myers Squibb Co. 170,000 3,590,400 Merck & Co., Inc. 75,000 2,467,500 Pfizer, Inc.(1) 450,000 8,401,500 Schering-Plough Corp. 302,500 6,376,700 ------------ 24,357,350 ------------ INDUSTRIALS--11.1% AEROSPACE & DEFENSE--4.2% Lockheed Martin Corp. 44,000 4,590,520 Raytheon Co. 83,500 4,753,655 United Technologies Corp. 90,000 5,758,200 ------------ 15,102,375 ------------ INDUSTRIAL CONGLOMERATES--4.0% General Electric Co.(1) 342,500 9,689,325 Siemens AG, Sponsored ADR 40,000 4,855,200 ------------ 14,544,525 ------------ MARINE--2.4% Britannia Bulk Holdings, Inc.(3) 373,250 4,915,703 Eagle Bulk Shipping, Inc. 70,000 2,032,800 Seaspan Corp. 70,000 1,664,600 ------------ 8,613,103 ------------ TRADING COMPANIES & DISTRIBUTORS--0.5% Aircastle Ltd. 175,900 1,926,105 INFORMATION TECHNOLOGY--5.2% COMMUNICATIONS EQUIPMENT--1.0% Corning, Inc.(1) 175,000 3,501,750 SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--2.3% Intel Corp. 68,750 1,525,563 KLA-Tencor Corp.(1) 42,500 1,597,575 Taiwan Semiconductor Manufacturing Co. Ltd., ADR(2) 400,000 3,800,000
2 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED
SHARES VALUE ------- ------------ SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT CONTINUED Texas Instruments, Inc. 51,250 $ 1,249,475 ------------ 8,172,613 ------------ SOFTWARE--1.9% Microsoft Corp. 275,000 7,073,000 MATERIALS--2.8% CHEMICALS--2.2% BASF SE, Sponsored ADR 48,000 3,027,360 Eastman Chemical Co.(1) 23,500 1,409,060 Lubrizol Corp. (The) 21,500 1,070,700 PPG Industries, Inc. 40,000 2,425,600 ------------ 7,932,720 ------------ METALS & MINING--0.6% Freeport-McMoRan Copper & Gold, Inc., Cl. B(1) 11,750 1,136,813 Teck Cominco Ltd., Cl. B 20,000 919,400 ------------ 2,056,213 ------------ TELECOMMUNICATION SERVICES--9.8% DIVERSIFIED TELECOMMUNICATION SERVICES--9.8% AT&T, Inc. 347,500 10,706,475 Consolidated Communications Holdings, Inc.(2) 413,250 5,768,970 FairPoint Communications, Inc.(2) 600,000 4,164,000 Frontier Communications Corp. 570,000 6,589,200 Qwest Communications International, Inc.(2) 365,000 1,397,950 Verizon Communications, Inc. 30,000 1,021,200 Windstream Corp.(2) 475,000 5,662,000 ------------ 35,309,795 ------------ UTILITIES--5.7% ELECTRIC UTILITIES--3.4% Cleco Corp. 240,000 6,031,200 FirstEnergy Corp. 85,000 6,251,750 ------------ 12,282,950 ------------ ENERGY TRADERS--0.7% Constellation Energy Group, Inc. 31,000 2,577,960 GAS UTILITIES--0.8% Southern Union Co. 120,000 3,134,400 MULTI-UTILITIES--0.8% CenterPoint Energy, Inc. 177,500 2,799,175 ------------ Total Common Stocks (Cost $411,009,928) 350,584,618 ------------ PREFERRED STOCKS--2.0% Lehman Brothers Holdings, Inc., 8.75% Cv., Series Q(3) 2,000 1,285,418 NRG Energy, Inc., 5.75% Cv. 10,000 3,124,375 XL Capital Ltd., 10.75% Cv.(3) 100,000 2,767,000 ------------ Total Preferred Stocks (Cost $7,939,905) 7,176,793 ------------
3 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED
PRINCIPAL AMOUNT VALUE ---------- ------------ U.S. GOVERNMENT OBLIGATIONS--0.5% U.S. Treasury Nts., 3.25%, 1/15/09 (Cost $2,011,276) $2,000,000 $ 2,013,594 CONVERTIBLE CORPORATE BONDS AND NOTES--1.2% National City Corp., 4% Cv. Sr. Unsec. Nts., 2/1/11 1,250,000 895,310 Rite Aid Corp., 8.50% Cv. Sr. Unsec. Unsub. Nts., 5/15/15(4) 4,375,000 3,417,969 ------------ Total Convertible Corporate Bonds and Notes (Cost $5,221,129) 4,313,279 ------------
SHARES ---------- INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED--9.2%(5) OFI Liquid Assets Fund, LLC, 2.48% (6,7) (Cost $33,230,700) 33,230,700 33,230,700 ------------ TOTAL INVESTMENTS, AT VALUE (COST $459,412,938) 109.7% 397,318,984 ------------ LIABILITIES IN EXCESS OF OTHER ASSETS (9.7) (35,108,632) ---------- ------------ NET ASSETS 100.0% $362,210,352 ========== ============
FOOTNOTES TO STATEMENT OF INVESTMENTS (1.) A sufficient amount of liquid assets has been designated to cover outstanding written call options. (2.) Partial or fully-loaned security. See accompanying Notes. (3.) Non-income producing security. (4.) A sufficient amount of liquid assets has been designated to cover outstanding written put options. (5.) The security/securities have been segregated to satisfy the forward commitment to return the cash collateral received in securities lending transactions upon the borrower's return of the securities loaned. See accompanying Notes. (6.) Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended July 31, 2008, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:
SHARES SHARES OCTOBER 31, GROSS GROSS JULY 31, 2007 ADDITIONS REDUCTIONS 2008 ----------- ---------- ----------- ---------- OFI Liquid Assets Fund, LLC -- 34,655,400 1,424,700 33,230,700 Oppenheimer Institutional Money Market Fund, Cl. E 3,483,696 71,016,674 74,500,370 --
DIVIDEND VALUE INCOME ----------- --------- OFI Liquid Assets Fund, LLC $33,230,700 $ 3,840(a) Oppenheimer Institutional Money Market Fund, Cl. E -- 227,764 ----------- -------- a. Net of compensation to counterparties $33,230,700 $231,604 =========== ========
(7.) Rate shhown is the 7-day yield as of July 31, 2008 4 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED WRITTEN OPTIONS AS OF JULY 31, 2008 ARE AS FOLLOWS:
NUMBER OF EXERCISE EXPIRATION PREMIUMS DESCRIPTION TYPE CONTRACTS PRICE DATE RECEIVED VALUE - ----------- ---- --------- -------- ---------- -------- --------- Abbott Laboratories Call 625 $ 60.00 8/18/08 $ 35,410 $ (6,250) Carnival Corp. Call 290 40.00 8/18/08 16,305 (13,050) Comcast Corp. Put 1,000 20.00 1/19/09 223,998 (155,000) Corning, Inc. Call 1,750 25.00 8/18/08 514,747 -- Credit Suisse Group AG, ADR Call 125 50.00 8/18/08 1,750 (20,000) Eastman Chemical Co. Call 235 75.00 9/22/08 121,264 -- Freeport-McMoRan Copper & Gold, Inc. Call 100 125.00 8/18/08 7,700 (2,500) General Electric Co. Call 1,250 31.00 8/18/08 13,015 (6,250) KLA-Tencor Corp. Call 425 42.50 8/18/08 41,225 (14,875) Pfizer, Inc. Call 350 20.00 8/18/08 3,192 (2,100) Wachovia Corp. Call 250 25.00 8/18/08 6,312 (750) -------- --------- $984,918 $(220,775) ======== =========
NOTES TO STATEMENT OF INVESTMENTS SECURITIES VALUATION. The Fund calculates the net asset value of its shares as of the close of the New York Stock Exchange (the "Exchange"), normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Securities may be valued primarily using dealer-supplied valuations or a portfolio pricing service authorized by the Board of Directors. Securities traded on a registered U.S. securities exchange 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. Securities whose principal exchange is NASDAQ(R) are valued based on the closing price reported by NASDAQ prior to the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the closing "bid" and "asked" prices, and if not, at the closing bid price. Securities traded on foreign exchanges are valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service, prior to the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the official closing price on the principal exchange. Corporate, government and municipal debt instruments having a remaining maturity in excess of sixty days and all mortgage-backed securities, collateralized mortgage obligations and other asset-backed securities will be valued at the mean between the "bid" and "asked" prices. Securities for which market quotations are not readily available are valued at their fair value. Securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund's assets are valued but after the close of their respective exchanges will be fair valued. Fair value is determined in good faith using consistently applied procedures under the supervision of the Board of Directors. Shares of a registered investment company that are not traded on an exchange are valued at the acquired investment company's net asset value per share. "Money market-type" debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value. FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in U.S. dollars. The values of securities denominated in foreign currencies and amounts related to the purchase and sale of foreign securities and foreign investment income are translated into U.S. dollars as of the close of the Exchange, normally 4:00 P.M. Eastern time, on each day the Exchange is open for trading. Foreign exchange rates may be valued primarily using a reliable bank, dealer or service authorized by the Board of Directors. Reported net realized gains and losses from foreign currency transactions arise from sales of portfolio securities, sales and maturities of short-term securities, sales of foreign currencies, exchange rate fluctuations between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund's books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized appreciation and depreciation on the translation of assets and liabilities denominated in foreign currencies arise from changes in the values of assets and liabilities, including investments in securities at fiscal period end, resulting from changes in exchange rates. 5 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED 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 in the annual and semiannual reports. INVESTMENT IN OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund ("IMMF") to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. The Fund's investment in IMMF is included in the Statement of Investments. As a shareholder, the Fund is subject to its proportional share of IMMF's Class E expenses, including its management fee. INVESTMENTS IN OFI LIQUID ASSETS FUND, LLC. The Fund is permitted to invest cash collateral received in connection with its securities lending activities. Pursuant to the Fund's Securities Lending Procedures, the Fund may invest cash collateral in, among other investments, an affiliated money market fund. OFI Liquid Assets Fund, LLC ("LAF") is a limited liability company whose investment objective is to seek current income and stability of principal. The Manager is also the investment adviser of LAF. LAF is not registered under the Investment Company Act of 1940. However, LAF does comply with the investment restrictions applicable to registered money market funds set forth in Rule 2a-7 adopted under the Investment Company Act. The Fund's investment in LAF is included in the Statement of Investments. As a shareholder, the Fund is subject to its proportional share of LAF's expenses, including its management fee. INVESTMENTS WITH OFF-BALANCE SHEET MARKET RISK. The Fund enters into financial instrument transactions (such as swaps, futures, options and other derivatives) that may have off-balance sheet market risk. Off-balance sheet market risk exists when the maximum potential loss on a particular financial instrument is greater than the value of such financial instrument, as reflected in the Fund's Statement of Assets and Liabilities in the annual and semiannual reports. OPTION ACTIVITY The Fund may buy and sell put and call options, or write put and covered call options. When an option is written, the Fund receives a premium and becomes obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. Options are valued daily based upon the last sale price on the principal exchange on which the option is traded. The difference between the premium received or paid, and market value of the option, is recorded as unrealized appreciation or depreciation. The net change in unrealized appreciation or depreciation is reported in the Statement of Operations in the annual and semiannual reports. When an option is exercised, the cost of the security purchased or the proceeds of the security sale are adjusted by the amount of premium received or paid. Upon the expiration or closing of the option transaction, a gain or loss is reported in the Statement of Operations in the annual and semiannual reports. Securities designated to cover outstanding call or put options are noted in the Statement of Investments where applicable. Options written are reported in a schedule following the Statement of Investments and as a liability in the Statement of Assets and Liabilities in the annual and semiannual reports. The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk that there may be an illiquid market where the Fund is unable to close the contract. Written option activity for the period ended July 31, 2008 was as follows: 6 | OPPENHEIMER EQUITY INCOME FUND, INC. OPPENHEIMER EQUITY INCOME FUND, INC. STATEMENT OF INVESTMENTS JULY 31, 2008 / UNAUDITED
CALL OPTIONS PUT OPTIONS ------------ ----------- NUMBER OF AMOUNT OF NUMBER OF AMOUNT OF CONTRACTS PREMIUMS CONTRACTS PREMIUMS --------- ------------ --------- ----------- Options outstanding as of October 31, 2007 -- $ -- -- $ -- Options written 111,230 9,695,151 1,500 259,182 Options closed or expired (103,395) (8,346,680) (500) (35,184) Options exercised (2,435) (587,551) -- -- -------- ----------- ----- -------- Options outstanding as of July 31, 2008 5,400 $ 760,920 1,000 $223,998 ======== =========== ===== ========
SECURITIES LENDING The Fund lends portfolio securities from time to time in order to earn additional income in the form of fees or interest on securities received as collateral or the investment of any cash received as collateral. The loans are secured by collateral (either securities, letters of credit, or cash) in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of each business day and any additional required collateral is delivered to the Fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund could experience delays and cost in recovering the securities loaned or in gaining access to the collateral. The Fund continues to receive the economic benefit of interest or dividends paid on the securities loaned in the form of a substitute payment received from the borrower and recognizes the gain or loss in the fair value of the securities loaned that may occur during the term of the loan. The Fund has the right under the lending agreement to recover the securities from the borrower on demand. As of July 31, 2008, the Fund had on loan securities valued at $32,242,677. Collateral of $33,230,700 was received for the loans, all of which was received in cash and subsequently invested in approved instruments. RECENT ACCOUNTING PRONOUNCEMENTS In September 2006, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 157, FAIR VALUE MEASUREMENTS. This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and expands disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. As of July 31, 2008, the Manager does not believe the adoption of SFAS No. 157 will materially impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period. In March 2008, FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities." This standard requires enhanced disclosures about derivative and hedging activities, including qualitative disclosures about how and why the Fund uses derivative instruments, how these activities are accounted for, and their effect on the Fund's financial position, financial performance and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years beginning after November 15, 2008 and interim periods within those fiscal years. At this time, management is evaluating the implications of SFAS No. 161 and its impact on the Fund's financial statements and related disclosures. FEDERAL TAX. The approximate aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of July 31, 2008 are noted below. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses. Federal tax cost of securities $432,250,800 Federal tax cost of other investments (984,918) ------------ Total federal tax cost $431,265,882 ============ Gross unrealized appreciation $ 11,864,196 Gross unrealized depreciation (79,262,569) ------------ Net unrealized depreciation $(67,398,373) ============
7 | OPPENHEIMER EQUITY INCOME FUND, INC. ITEM 2. CONTROLS AND PROCEDURES. (a) Based on their evaluation of the registrant's disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR 270.30a-3(c)) as of 07/31/2008, the registrant's principal executive officer and principal financial officer found the registrant's disclosure controls and procedures to provide reasonable assurances that information required to be disclosed by the registrant in the reports that it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated to the registrant's management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure, and (b) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the U.S. Securities and Exchange Commission. (b) There have been no significant changes in the registrant's internal controls over financial reporting that occurred during the registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 3. EXHIBITS. Exhibits attached hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Oppenheimer Equity Income Fund, Inc. By: /s/ John V. Murphy --------------------------- John V. Murphy Principal Executive Officer Date: 09/12/2008 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ John V. Murphy --------------------------- John V. Murphy Principal Executive Officer Date: 09/12/2008 By: /s/ Brian W. Wixted --------------------------- Brian W. Wixted Principal Financial Officer Date: 09/12/2008 EX-99.CERT 2 rq835_49379cert302.txt RQ835_49379CERT302.TXT Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, John V. Murphy, certify that: 1. I have reviewed this report on Form N-Q of Oppenheimer Equity Income Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of Directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ John V. Murphy - --------------------------- John V. Murphy Principal Executive Officer Date: 09/12/2008 Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, Brian W. Wixted, certify that: 1. I have reviewed this report on Form N-Q of Oppenheimer Equity Income Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of Directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ Brian W. Wixted - --------------------------- Brian W. Wixted Principal Financial Officer Date: 09/12/2008 -----END PRIVACY-ENHANCED MESSAGE-----