<PAGE> 1
DEAR SHAREHOLDER:
A year after Federal Reserve Chairman Alan Greenspan voiced concerns about
"irrational exuberance" in the U.S. stock market, the country's financial
picture remains bright. The economy is still generating good news, and economic
growth is still strong. Moreover, higher inflation has not yet materialized,
despite healthy economic growth.
U.S. financial markets were robust during 1997, as demonstrated by the Dow Jones
Industrial Average, which rebounded from occasional setbacks last year to post
20%-plus gains. U.S. corporate and Treasury bonds benefited from low inflation
and the "flight to quality" sparked by turmoil in world stock markets at the end
of October. The flight, a switch out of stocks into long-term bonds, took place
when investors, fearing that the bottom would fall out of the U.S. stock market,
began to favor bonds as a "safe haven."
In the municipal market, short-term interest rates tended to vary over the
course of the year. Interest rates on municipals declined when they generally
tend to do so--for example, when capital flowed into the municipal market at the
beginning of each month, and at times when low supply/high demand conditions
prevailed. But rates began rising in September due to factors such as account
liquidations, high dealer inventory, and a lull in demand. The interest rate
uptrend continued into October, after the U.S. stock market experienced a steep
decline. At that time, investors sold municipals and used the proceeds to buy
stocks at "bargain basement" prices.
One benefit of investors' pullout from municipal securities in October 1997 was
that it created a boost in supply following the scarcity of municipals in 1996.
Yet another benefit for short-term municipal bonds last year was that the
proposed legislation to eliminate the 2% corporate tax exemption did not pass
Congress. This legislation would have resulted in much higher short-term
municipal rates and sharply lower municipal prices. That's because corporations
that invest primarily in municipals would not have received tax credits, and
would likely have curtailed further investments in these securities.
For the period ended December 31, 1997, the Trust had a compounded annualized
yield of 3.11%. Without compounding, the corresponding yield was 3.06%. For
investors in the 36% federal tax bracket, this is equivalent to a taxable yield
for six months of 4.86% with compounding, and 4.78% without. The seven-day
annualized yields, with and without compounding, as of December 31, 1997 were
3.35% and 3.29%, respectively.(1)
Looking ahead to 1998, the main factor likely to influence U.S. markets will
likely be global--the financial and economic crisis in Asia--rather than
domestic. Our view is that Asia's problems may have a negative impact on
economic growth and corporate earnings--not just in the United States, but
abroad as well. The Asian situation could also lead to lower U.S. inflation, as
imports increase and exports face more resistance overseas. Due to Asia's
problems and their
1. Compounded yields assume reinvestment of dividends. Past performance does not
guarantee future results.
<PAGE> 2
potential effects on the U.S. economy, we expect the Federal Reserve Board to
refrain from raising interest rates. In fact, if prices remain low or begin to
decline, we may even see an interest rate cut. Therefore, against a backdrop of
steady to declining long-term interest rates and low inflation, we believe
investors will continue viewing U.S. fixed income markets as a secure place to
invest.
The Trust's focus will remain on high quality investments. Quality is important
so that Centennial Tax Exempt Trust can continue to provide liquidity. For
example, the Trust includes a substantial amount of Texas and Michigan notes,
due to their superior liquidity compared with other municipal investments of the
same maturity. Texas and Michigan notes offer better liquidity than other
states' short-term municipal debt due to their out-of-cycle maturity dates:
While most notes mature at the end of June, Texas and Michigan notes mature at
the end of August and September, respectively. Texas and Michigan notes are also
in relatively short supply, with about $1 billion issued for each state
(compared with $3 billion for states such as New York). The notes' maturity
schedule and their relative scarcity in the municipal market allow them to
command a higher price.
Quality is critical not only to liquidity, but to the Trust's safety of
principal as well. Approximately two-thirds of the Trust's securities are
enhanced by municipal bond insurance or bank letters of credit. However, it is
important to remember that an investment in the Trust is neither insured nor
guaranteed by the U.S. government, and there is no assurance that the Trust
will maintain a stable $1.00 share price in the future.
Thank you for your confidence in Centennial Tax Exempt Trust. We look forward to
helping you meet your financial goals in the future.
Sincerely,
/s/ JAMES C. SWAIN
James C. Swain
Chairman
Centennial Tax Exempt Trust
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
President
Centennial Tax Exempt Trust
January 23, 1998
2
<PAGE> 3
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
SHORT-TERM TAX-EXEMPT OBLIGATIONS-105.7%
ARIZONA-2.5%
<S> <C> <C>
AZ HFAU RB, Blood Systems, Inc., 4%(1) ....................................... $ 7,725,000 $ 7,725,000
Maricopa Cnty., AZ IDAU SWD RB, Rainbow Valley Landfill Project,
Series A, 4%, 12/1/98(2) ................................................. 4,000,000 4,000,000
Phoenix, AZ IDAU MH RRB:
Lynwood Apts. Project, 4%(1) ............................................. 6,475,000 6,475,000
Paradise Lakes Apts. Project, 1995 Series, 3.90%(1) ...................... 22,500,000 22,500,000
Tucson, AZ IDAU RB, Geronimo Building Renovation Project, 4%, 12/15/98(2) .... 1,005,000 1,005,000
-----------
41,705,000
-----------
ARKANSAS-0.0%
Subiaco, AR IDV RB, Cloves Gear & Products, Inc., 4.46%(1) ................... 265,000 265,000
-----------
CALIFORNIA-13.0%
Anaheim, CA HAU MH RRB, Park Vista Apts., Series A, 3.75%(1) ................. 1,000,000 1,000,000
CA HEAU RRB, Series D-1, 3.80%, 8/1/98 ....................................... 3,900,000 3,900,000
CA HEAU Student Loan RB:
3.95%, 5/1/98(2) ......................................................... 34,400,000 34,400,000
Series C, 3.75%(1) ....................................................... 4,000,000 4,000,000
CA HEAU Student Loan RRB:
Series 1987A, 3.95%, 5/1/98(2) ........................................... 27,175,000 27,175,000
Series 1992A-2, 3.95%, 5/1/98(2) ......................................... 14,000,000 14,000,000
CA HFFAU RB:
Pooled Loan Program, Series B, FGIC Insured, 3.50%(1) .................... 500,000 500,000
Scripps Memorial Hospital, Series A, MBIA Insured, 3.65%(1) .............. 320,000 320,000
CA HFFAU RRB, Catholic West Project, Series C, MBIA Insured, 3.90%(1) ........ 4,000,000 3,999,999
CA M-S-R PPA RB, San Juan Project, Sub. Lien, Series E, MBIA Insured, 3.60%(1) 2,000,000 2,000,000
CA Municipal RB, Series SG89, MBIA Insured, 4%(1) ............................ 7,425,000 7,425,000
CA SCDAU MH RB, 3.90%(1) ..................................................... 3,700,000 3,700,102
CA School Cash Reserve Program Authority Nts., Series A, AMBAC Insured,
4.75%, 7/2/98 ............................................................ 61,000,000 61,263,396
CA Statewide CDC RB, Fibrebond, Inc., 3.85%(1) ............................... 2,000,000 1,999,979
Huntington Park, CA RA MH RB, Casa Rita Apts., Series A, 3.85%(1) ............ 1,100,000 1,100,000
Irvine, CA Public Facilities & Infrastructure Authority Lease RB,
Capital Improvement Projects, 3.65%(1) ................................... 2,570,000 2,569,975
Los Angeles, CA Airport RB, Series SG61, 4%(1) ............................... 1,055,000 1,055,000
Modesto, CA Irrigation District FAU RB, Series SG66, 4%(1) ................... 500,000 500,000
Northern CA PPA RRB, Geothermal Project 3-A, 3.35%(1) ........................ 2,000,000 2,000,025
Oakland, CA Tax & RAN, 4.50%, 6/30/98 ........................................ 9,250,000 9,280,219
</TABLE>
3
<PAGE> 4
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
CALIFORNIA-(CONTINUED)
<S> <C> <C>
Oceanside, CA MH RRB, Lakeridge Apts. Project, 4.40%(1) ......................... $ 4,100,000 $ 4,100,000
Pittsburg, CA Mortgage Obligation Guaranteed RB, Series A, 3.95%(1) ............. 3,970,000 3,970,031
Riverside Cnty., CA HAU MH RB, McKinley Project, 3.75%(1) ....................... 4,800,000 4,799,988
Sacramento Cnty., CA MH RRB, Issue A, 3.45%(1) .................................. 3,400,000 3,400,026
San Bernardino Cnty., CA Tax & RAN, Series A, 4.50%, 6/30/98 .................... 17,500,000 17,554,000
San Francisco, CA City & Cnty. Redevelopment FAU RRB,
Yerba Buena Garden, 3.90%(1) ................................................ 625,000 625,000
Southern CA PAU RRB, Palo Verde Project, Series B, AMBAC Insured, 3.35%(1) ...... 2,400,000 2,400,000
------------
219,037,740
------------
COLORADO-2.6%
Arapahoe Cnty., CO MH RRB, Hunters Run Rental Housing, 4.15%(1) ................. 25,600,000 25,600,000
Aurora, CO IDV RRB, La Quinta Motor Inns, Inc., 4.05%(1) ........................ 2,400,000 2,400,000
CO Housing FAU RRB, Loretto MH, Series F, 3.85%(1) .............................. 9,200,000 9,200,000
Superior Metropolitan District No. 3, CO GOB, 4%(1) ............................. 5,000,000 5,000,000
Wheat Ridge, CO IDV RRB, La Quinta Motor Inns, Inc., 4.05%(1) ................... 1,650,000 1,650,000
------------
43,850,000
------------
DELAWARE-0.4%
DE EDAU RB, Hospital Billing Project, Series A, BIG Insured, 3.65%(1) ........... 6,100,000 6,100,000
------------
FLORIDA-5.9%
Dade Cnty., FL WSS RB, FGIC Insured, 3.70%, 7/1/98(2) ........................... 9,500,000 9,500,000
Escambia Cnty., FL HFAU RRB, Florida Convertible Centers Project, Series A, 4%(1) 1,250,000 1,250,000
FL BOE Capital Outlay Public Education Refunding Bonds, Series A, 3.90%(1) ...... 13,230,000 13,230,000
FL HFA MH RRB, Monterey Lake Project, 3.70%(1) .................................. 19,965,000 19,965,000
FL Turnpike Authority RB, Series A, FGIC Insured, 3.70%, 7/1/98(2) .............. 14,200,000 14,200,000
Hillsborough Cnty., FL IDAU PC COP, Tampa Electric Co. Project,
MBIA Insured, 3.60%(1) ...................................................... 17,000,000 17,000,000
Hillsborough Cnty., FL IDAU PC RB, Tampa Electric Co. Project, 4.27%(1) ......... 17,000,000 17,000,000
Jacksonville FL IDV RRB, Airport Hotel Project, 4.10%(1) ........................ 3,000,000 3,000,000
Orange Cnty., FL Housing FAU MH RRB, Monterey Project, Series B, 4.10%(1) ....... 4,815,000 4,815,000
------------
99,960,000
------------
GEORGIA- 4.2%
Burke Cnty., GA DAU PC RRB, Oglethorpe Power Corp. Vogtle, Series B,
AMBAC Insured, 3.80%, 5/28/98 ............................................... 16,000,000 16,000,000
Cobb Cnty., GA HAU MH RRB, Terrell Mill Project, 3.85%(1)(3) .................... 9,400,000 9,400,000
</TABLE>
4
<PAGE> 5
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
GEORGIA (CONTINUED)
<S> <C> <C>
Fulton Cnty., GA DAU RB:
Georgia Tech Athletic Assn., Inc., 4.20%(1) .................................... $ 3,000,000 $ 3,000,000
Lovett School Project, 4.20%(1) ................................................ 3,000,000 3,000,000
Robert W. Woodruff Arts Project, 4.20%(1) ...................................... 2,000,000 2,000,000
Fulton Cnty., GA Residential Care Facilities RB, Canterbury Court Project,
Series A, 4.20%(1) .............................................................. 2,255,000 2,255,000
GA GOB, Series 1995B, 4.10%(1) ..................................................... 11,400,000 11,400,000
Roswell, GA HAU MH RRB, Oxford Project, 4%(1) ...................................... 23,610,000 23,610,000
------------
70,665,000
------------
IDAHO-0.1%
Custer Cnty., ID IDV SWD RB, Hecla Mining Co. Project, 4.20%(1) .................... 1,000,000 1,000,000
------------
ILLINOIS-7.6%
Centralia City, IL IDV RB, Consolidated Foods Corp./Hollywood Brands, Inc., 4%(1) .. 5,500,000 5,500,000
Elk Grove Village, IL IDV RB, La Quinta Motor Inns, Inc., 4.20%(1) ................. 2,700,000 2,700,000
IL Development FAU PC RRB, Consolidated Edison Co. Project, Series B,
AMBAC Insured, 4.05%(1) ........................................................ 30,700,000 30,700,000
IL Development FAU RB, Residential Brookdale Project, 4.05%(1) ..................... 14,800,000 14,800,000
IL Educational FA RB, National-Louis University, 4.05%(1) .......................... 6,200,000 6,200,000
IL HFAU RB:
Childrens Memorial Hospital, Series A, 3.75%, 2/12/98 .......................... 15,000,000 15,000,000
Lake Forest Hospital Project, 4.25%(1) ......................................... 11,375,000 11,375,000
IL IDAU RRB, SuperValu, Inc. Project, 4.10%(1) ..................................... 5,000,000 5,000,000
IL Student Assistance Commission Student Loan RB, Series A, 3.75%(1) ............... 13,200,000 13,200,000
Lakemoor Village, IL MH Mtg. RB, Lakemoor Apts. Project:
4.70%, 3/16/98(2) .............................................................. 15,000,000 15,000,000
Series A, 4.20%, 9/1/98(2) ..................................................... 4,662,536 4,662,536
West Chicago, IL IDV RRB, Liquid Container Project, 4.10%(1) ....................... 3,810,000 3,810,000
------------
127,947,536
------------
INDIANA-2.3%
Crawfordsville, IN ED RRB, Pedcor Investments-Shady Knoll Apts. Project, 4.05%(1) .. 3,395,000 3,395,000
Gary, IN Industrial Environmental Improvement RB, U.S. Steel Corp. Project, 4.05%(1) 1,000,000 1,000,000
Greenfield, IN Industrial ED RRB, 4%(1) ............................................ 1,145,000 1,145,000
Greenwood, IN Industrial ED RRB, 4%(1) ............................................. 1,155,000 1,155,000
Hobart, IN ED RRB, MMM Invest, Inc. Project, 4%(1) ................................. 1,785,000 1,785,000
IN Development FAU RB, Brebeuf Prep School, 4%(1) .................................. 3,500,000 3,500,000
</TABLE>
5
<PAGE> 6
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
INDIANA-(CONTINUED)
<S> <C> <C>
IN EDFAU RB, Saroyan Hardwoods, Inc., 4.10%(1) ........................................ $ 1,850,000 $ 1,850,000
IN HFFAU RRB, Sisters of St. Francis Health, Series A, MBIA Insured, 5%, 11/1/98 ...... 1,000,000 1,008,864
Marion Cnty., IN HA Hospital Facility RB, Indianapolis Osteopathic, 4.22%(1) .......... 3,275,000 3,275,000
Rockport, IN PC RRB, Indiana & Michigan Electric Co. Project, Series A, 3.85%(1) ...... 13,000,000 13,000,000
St. Joseph Cnty., IN HA SPO Bonds, Madison Center, Inc. Project, 4.22%(1) ............. 6,720,000 6,720,000
St. Joseph Cnty., IN Industrial Educational Facilities RB, Holy Cross College, 4.22%(1) 1,230,000 1,230,000
-----------
39,063,864
-----------
IOWA-0.3%
Mason City, IA IDV RB, SuperValu Stores, Inc. Project, 4%(1) .......................... 4,900,000 4,900,000
-----------
KANSAS-0.1%
Olathe, KS Industrial RRB, William F. Bieber Project, 4.15%(1) ........................ 1,550,000 1,550,000
Ottawa, KS IDV RB, Laich Industries Project, 4.46%(1) ................................. 610,000 610,000
-----------
2,160,000
-----------
KENTUCKY-1.0%
Jamestown, KY Industrial Building RB, Union Underwear Co., 3.80%(1) ................... 1,000,000 1,000,000
Mayfield, KY Multi-City Lease RB, Kentucky League of Cities Funding Trust, 3.90%(1) ... 15,200,000 15,200,000
-----------
16,200,000
-----------
LOUISIANA-0.4%
East Baton Rouge Parish, LA IDV Board RRB, La Quinta Motor Inns, Inc., 4.05%(1) ....... 1,925,000 1,925,000
Lake Charles, LA Harbor & Terminal District RB, Reynolds Metals Co. Project,
3.85%, 12/1/98(2) ................................................................. 4,085,000 4,085,000
-----------
6,010,000
-----------
MARYLAND-3.9%
Anne Arundel Cnty., MD ED RB, West Capitol, Series A, 4%(1) ........................... 6,000,000 6,000,000
Hartford Cnty., MD RRB, 1001 Partnership Facility Project, 4.50%(1) ................... 2,350,000 2,350,000
MD Health & HEFAU RB, University of Maryland Pooled Loan Program,
Series B, 4.50%(1) ................................................................ 1,075,000 1,075,000
Montgomery Cnty., MD GOB, Series A, 5%, 5/1/98 ........................................ 4,750,000 4,766,637
Montgomery Cnty., MD MH Opportunities Commission RB,
Grosvenor House Project, Series A, 4.50%(1) ....................................... 19,700,000 19,700,000
Montgomery Cnty., MD MH Opportunities Commission RB, Issue A, 3.85%(1) ................ 23,800,000 23,800,000
Worcester Cnty., MD RRB, White Marlin Mall Project, 4.20%(1) .......................... 7,650,000 7,650,000
-----------
65,341,637
-----------
</TABLE>
6
<PAGE> 7
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
MASSACHUSETTS-1.2%
<S> <C> <C>
MA CMWLTH GOB, Series C, 4.05%(1) ............................................... $14,600,000 $14,600,000
MA HFA RB, SFM, Series 50, 3.90%, 6/1/98 ........................................ 5,535,000 5,535,000
North Andover Town, MA Industrial RB, Atlee-Oak Realty Trust of
Delaware, Inc., 4.33%(1) .................................................... 350,000 350,000
-----------
20,485,000
-----------
MICHIGAN-5.3%
Madison Heights, MI ED RB, Red Roof Inns Project, 3.95%(1) ...................... 1,000,000 1,000,000
MI Hospital FAU RRB, Mount Clemens General Hospital, 4.10%(1) ................... 9,520,000 9,520,000
MI Job DAU RB, East Lansing Residence Associates Project, 3.75%(1) .............. 1,900,000 1,900,000
MI Tax & RAN, 4.50%, 9/30/98 .................................................... 76,750,000 77,159,124
-----------
89,579,124
-----------
MINNESOTA- 4.7%
Anoka City, MN MH RB, Walker Plaza, Series B, 4.15%(1) .......................... 1,650,000 1,650,000
Austin, MN IDV RRB, SuperValu Stores, Inc. Project, 4%(1) ....................... 4,600,000 4,600,000
Blaine, MN IDV RRB, SuperValu Stores, Inc. Project, 4%(1) ....................... 5,500,000 5,500,000
Bloomington, MN POAU Tax RRB, Mall of America Project,
Series C, FSA Insured, 4.20%(1) ............................................. 8,300,000 8,300,000
Burnsville, MN CD RB, SuperValu Stores, Inc. Project, Series 83, 4%(1) .......... 5,500,000 5,500,000
Cloquet, MN Industrial Facilities RB, Potlatch Corp. Projects, Series C, 3.90%(1) 4,500,000 4,500,000
Dakota Cnty., MN MH & Redevelopment Mtg. RB,
Westwood Ridge Rental Housing Project, Series A, 4.05%(1) ................... 4,100,000 4,100,000
Eden Prairie, MN CD RRB, Lakeview Business Center, 4.05%(1) ..................... 2,495,000 2,495,000
Eden Prairie, MN IDV RB, SuperValu Stores, Inc. Project, 4%(1) .................. 1,000,000 1,000,000
Maplewood, MN CD RRB, 5.27%(1) .................................................. 495,000 495,000
Minneapolis, MN CD RRB, Minnehaha/Lake Partners Project, 4.20%(1) ............... 2,750,000 2,750,000
Minneapolis, MN Community Development Agency RRB,
Heart Institute Foundation Project, 4.15%(1) ................................ 2,900,000 2,900,000
Minneapolis, MN RB, Catholic Charities Project, 3.95%(1) ........................ 3,000,000 3,000,000
New Ulm, MN Hospital Facilities RB, Health Center Systems, 3.80%(1) ............. 2,300,000 2,300,000
North Suburban Hospital District, MN RB, Anoka & Ramsey Cntys
Hospital Health Center, 3.80%(1) ............................................ 3,300,000 3,300,000
St. Paul, MN Housing & Redevelopment Authority RB,
Science Museum of Minnesota, Series B, 4.054%(1) ............................ 6,900,000 6,900,000
St. Paul, MN POAU Tax Increment RB,
Westgate Office & Industrial Center Project, 4.15%(1) ....................... 10,300,000 10,300,000
</TABLE>
7
<PAGE> 8
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
MINNESOTA (CONTINUED)
<S> <C> <C>
Stillwater, MN IDV RRB, SuperValu Stores, Inc. Project, 4%(1) ............ $ 5,500,000 $ 5,500,000
Waite Park, MN Housing RRB, Park Meadows Apts. Project, 4.05%(1) ......... 3,195,000 3,195,000
-----------
78,285,000
-----------
MISSOURI-3.0%
MO Environmental Improvement & Energy Research Authority PC RB,
Union Electric Co., Series B, 3.95%, 6/1/98 .......................... 37,975,000 37,975,507
St. Charles Cnty., MO IDV RRB, Remington Apts. Project, 4.50%(1) ......... 12,700,000 12,700,000
-----------
50,675,507
-----------
MONTANA-0.8%
Great Falls, MT IDV RRB, SuperValu Stores, Inc. Project, 4%(1) ........... 1,000,000 1,000,000
MT Board Investment RR RB, Colstrip Project, 3.75%(1) .................... 3,000,000 3,000,000
MT Tax & RAN, 4.50%, 6/30/98 ............................................. 10,000,000 10,032,645
-----------
14,032,645
-----------
NEBRASKA-0.2%
Norfolk, NE IDV RRB, SuperValu Stores, Inc. Project, 4%(1) ............... 2,800,000 2,800,000
-----------
NEVADA-1.2%
NV Tax Bonds, Series SG114, 4.05%(1) ..................................... 20,350,000 20,350,000
-----------
NEW JERSEY-0.2%
NJ EDAU Manufacturing Facilities RB, VPR Commerce Center Project, 4.25%(1) 3,700,000 3,700,020
-----------
NEW YORK-5.8%
Franklin Cnty., NY IDA RAN, McAdam Cheese Co. Project, 4%(1) ............. 600,000 600,000
Hempstead Town, NY GOB, AMBAC Insured, 5%, 2/15/98 ....................... 2,572,000 2,575,293
Jefferson Cnty., NY IDA RB, 3.70%(1) ..................................... 500,000 500,000
NY PAU RB, Series SG4, 4.05%(1) .......................................... 2,295,000 2,295,001
NYC GOB, 3.75%, 3/19/98 .................................................. 1,000,000 1,000,000
NYC HDC Multifamily Mortgage RB, James Tower Development,
Series A, 3.60%(1) ................................................... 3,000,000 3,000,000
NYC Health & Hospital Corp. RB, Series D, 3.50%(1) ....................... 1,500,000 1,500,000
NYC IDA Civic Facility RB, Columbia Grammar School Project, 3.60%(1) ..... 1,000,000 999,978
NYC IDV RB, Brooklyn Navy Yard Cogeneration, Series A, 4.25%(1) .......... 2,400,000 2,399,946
NYC Trust Cultural Resources RRB, American Museum of Natural History,
Series A, MBIA Insured, 3.55%(1) ..................................... 1,000,000 1,000,000
</TABLE>
8
<PAGE> 9
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
---------- -----------
NEW YORK (CONTINUED)
<S> <C> <C>
NYC Trust Cultural Resources RRB, American Museum of Natural History,
Series B, MBIA Insured, 3.55%(1) ................................... $ 600,000 $ 600,002
NYS DA COP, Rockefeller University, 3.52%(1) ........................... 500,000 500,012
NYS ERDAUEF RB, L.I. Lighting Co.:
Series A, 3.97%(1) ................................................. 400,000 400,002
Series B, 3.85%(1) ................................................. 1,300,000 1,300,002
NYS ERDAUPC RB, NYS Electric & Gas Corp., Series B, 3.80%, 10/15/98(2) . 700,000 699,812
NYS ERDAUPC RRB, Orange/Rockland Utility Project,
Series A, AMBAC Insured, 3.55%(1) .................................. 1,400,000 1,399,998
NYS HFA RB, Normandie Court I Project, 4%(1) ........................... 1,000,000 999,997
NYS LGAC RB:
Series A, 3.50%(1) ................................................. 1,900,000 1,899,938
Series SG100, MBIA Insured, 4.05%, 4/1/98 .......................... 10,420,000 10,420,000
Series SG99, MBIA Insured, 4.05%, 4/1/98(2) ........................ 17,195,000 17,195,000
NYS MCFFA RB, Lenox Hill Hospital Project, Series A, 3.60%(1) .......... 300,000 299,999
NYS TBTAU Beneficial Interest COP, MBIA Insured, 3.70%, 1/15/98(2) ..... 3,300,000 3,300,000
NYS TBTAU COP, Series A, 4.05%(1) ...................................... 9,700,000 9,700,000
Suffolk Cnty., NY IDA RB, Nissequogue Cogeneration Partnership, 3.65%(1) 800,000 800,007
Suffolk Cnty., NY Tax Anticipation Nts., Series RA-1, 4.25%, 8/13/98 ... 32,500,000 32,617,000
-----------
98,001,987
-----------
NORTH CAROLINA-0.3%
NC National Bank Pooled Tax-Exempt Trust COP:
Series 1990A, 4.25%(1) ............................................. 3,830,000 3,830,000
Series 1990B, 4.25%(1) ............................................. 1,815,000 1,815,000
-----------
5,645,000
-----------
NORTH DAKOTA-0.1%
Bismarck, ND IDV RRB, SuperValu Stores, Inc. Project:
4%(1) .............................................................. 1,500,000 1,500,000
4.10%(1) ........................................................... 800,000 800,000
-----------
2,300,000
-----------
OHIO-4.0%
Coshocton Cnty., OH Hospital FA RB, Coshocton Cnty.,
Memorial Hospital Project, 4%(1) ................................... 3,500,000 3,500,000
Gallia Cnty., OH IDV Mtg. RRB, Jackson Pike Assn., 3.85%, 6/15/98(2) ... 3,855,000 3,855,000
Greene Cnty., OH IDV RRB, SuperValu Holdings, Inc. Project, 4%(1) ...... 1,000,000 1,000,000
</TABLE>
9
<PAGE> 10
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
OHIO (CONTINUED)
<S> <C> <C>
Lorain Cnty., OH Hospital Facility RB, Catholic Health Care Partners,
3.70%, 1/8/98 ........................................................ $20,700,000 $20,700,000
Lucas Cnty., OH IDV RRB, H.H. Motel, Inc. Project, 4%(1) ................. 3,105,000 3,105,000
Marion Cnty., OH Hospital RB, Pooled Lease Program:
4%(1) ................................................................ 6,290,000 6,290,000
4%(1) ................................................................ 3,055,000 3,055,000
Miami Valley, OH Tax-Exempt Mortgage Trust RB, Series 86, 4.88%,
10/15/98(2) .......................................................... 2,730,000 2,730,000
OH Water DAU PC Facilities RRB, Duquesne Project,
Series A, 3.85%, 11/18/98 ............................................ 14,955,000 14,955,000
Scioto Cnty., OH Health Care Facilities RB,
Hill View Retirement Center, 3.85%, 6/1/98(2) ........................ 2,735,000 2,735,000
Toledo, OH City Services SPAST Nts., 4%(1) ............................... 2,720,000 2,720,000
Warren Cnty., OH IDV RRB, Liquid Container Project, 4.10%(1) ............. 1,670,000 1,670,000
-----------
66,315,000
-----------
OKLAHOMA-0.9%
Claremore, OK Industrial & Redevelopment Authority RRB,
Worthington Cylinder Project, 4.05%(1) ............................... 2,215,000 2,215,000
Cleveland Cnty., OK Public Facilities RB, Hunt Development Project,
Series A, 3.90%(1) ................................................... 1,000,000 1,000,000
Mid-West, OK Tax-Exempt Mortgage Board Trust RB, 3.85%(1) ................ 790,000 790,000
OK Water Resource Board State Loan Program RB, 3.75%, 3/2/98 ............. 4,340,000 4,340,000
Tulsa, OK Industrial Authority RB, 3.66%(1) .............................. 6,500,000 6,500,000
-----------
14,845,000
-----------
OREGON-0.6%
Hillsboro, OR RB, Oregon Graduate Institute, 4.05%(1) .................... 6,500,000 6,500,000
OR Economic & IDV Commission RB, Eagle-Picher Industries Project, 3.80%(1) 3,600,000 3,600,000
-----------
10,100,000
-----------
PENNSYLVANIA-1.9%
Monroe Cnty., PA HA RB, Pocono Medical Center, Series C, 4.10%(1) ........ 3,000,000 3,000,000
Montgomery Cnty., PA IDAU RB, Quaker Chemical Corp. Project, 3.85%(1) .... 1,600,000 1,600,000
PA HEFAU RB, Council Independent Colleges:
Series A3, 4.75%, 4/1/98(2) .......................................... 2,600,000 2,604,961
Series A4, 4.75%, 4/1/98 ............................................. 1,200,000 1,202,289
PA Higher Education University Funding Obligations RB,
Temple University, 4.75%, 5/18/98(2) ................................. 16,000,000 16,049,079
Philadelphia, PA Tax & RAN, Series A, 4.50%, 6/30/98 ..................... 8,000,000 8,018,962
-----------
32,475,291
-----------
</TABLE>
10
<PAGE> 11
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
----------- -----------
SOUTH CAROLINA-2.6%
<S> <C> <C>
Charleston Center Tax-Exempt Bonds:
Grantor Trust No. 2, 3.90%, 5/1/98(2) ........................................... $ 4,407,500 $ 4,407,500
Grantor Trust No. 3, 3.75%, 7/1/98(2) ........................................... 9,452,500 9,452,500
Grantor Trust No. 6, 3.80%, 4/1/98(2) ........................................... 8,075,000 8,075,000
Dorchester Cnty., SC PC Facilities RRB, The BOC Group, Inc. Project, 4%(1) .......... 3,500,000 3,500,000
SC Educational FA RB, Private Nonprofit Institutions-Morris College Project, 4.05%(1) 3,000,000 3,000,000
SC Jobs & EDAU Hospital Facility RRB, Wellman, Inc. Project, 4.10%(1) ............... 1,000,000 1,000,000
SC Public Service Authority RB, Series 182, MBIA Insured, 4.05%(1) .................. 14,200,000 14,200,000
-----------
43,635,000
-----------
SOUTH DAKOTA-2.2%
Grant Cnty., SD PC RRB, Otter Tail Power Co. Project, 4.20%(1) ...................... 10,400,000 10,400,000
SD Health & Educational Facilities RB, Sioux Valley Hospital Issue, 4.20%(1) ........ 22,000,000 22,000,000
Watertown, SD IDV RRB, SuperValu Stores, Inc. Project, 4.10%(1) ..................... 3,900,000 3,900,000
-----------
36,300,000
-----------
TENNESSEE-2.1%
Clarksville, TN Public Building Authority RB,
Pooled Financing-Tennessee Municipal Bond Fund, 4%(1) ........................... 10,100,000 10,100,000
Dayton, TN IDV Board RRB, La-Z-Boy Chair Co. Project, 4%(1) ......................... 4,350,000 4,350,000
Fayetteville & Lincoln, TN IDV Board RB, V.A.W. of America, 4.20%(1) ................ 2,000,000 2,000,000
Knox Cnty., TN IDV Board RB, Weisgarber Partners, FGIC Insured, 3.95%(1) ............ 3,000,000 3,000,000
Nashville & Davidson Cnty. Metropolitan Government, TN Educational &
HF Board RB, Vanderbilt University Project, Series 1985B, 3.95%, 5/1/98(2) ...... 2,500,000 2,500,000
Nashville & Davidson Cnty. Metropolitan Government, TN MH RB,
Arbor Crest Project, Series B, 4%(1) ............................................ 3,550,000 3,550,000
Rutherford Cnty., TN IDV Board Industrial Building RB,
Derby Industries, Inc. Project, 4.10%(1) ........................................ 1,345,000 1,345,000
TN GOB, 5%, 5/1/98(2) ............................................................... 8,640,000 8,670,243
-----------
35,515,243
-----------
TEXAS-17.2%
Greater East TX HEAU RRB, Student Loans, Series A, 3.85%, 5/1/98 .................... 4,700,000 4,700,000
Gulf Coast, TX IDAU Marine Terminal RB, Amoco Oil Project, 3.80%, 6/1/98(2) ......... 8,065,000 8,065,000
Harris Cnty., TX Criminal Justice Center RB, Series SG96, FGIC Insured, 4.05%(1) .... 7,475,000 7,475,000
Harris Cnty., TX Tax Anticipation Nts., 4.25%, 2/27/98 .............................. 75,000,000 75,061,329
Harris Cnty., TX Toll Road COP, 3.97%(1) ............................................ 9,500,000 9,500,000
</TABLE>
11
<PAGE> 12
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
TEXAS (CONTINUED)
<S> <C> <C>
Hockley Cnty., TX IDV Corp. PC RB, Amoco Project-Standard Oil Co.,
3.75%, 3/1/98(2) .................................................. $ 20,000,000 $ 20,000,000
Houston, TX WSS RB, Series SG120, 4.05%(1) ............................ 37,600,000 37,600,000
San Antonio, TX Electric & Gas RRB, Series SG105, 3.60%(1) ............ 20,000,000 20,000,000
Travis Cnty., TX Housing Finance Corp. MH RB, Bent Oaks Apts., 4.05%(1) 4,400,000 4,400,000
TX Tax & RAN, Series A, 4.75%, 8/31/98 ................................ 81,800,000 82,498,656
TX TUAU RB, Dallas Northtollway, Series SG70, 4.05%(1) ................ 15,325,000 15,325,000
Yoakum Cnty., TX IDV PC RB, Amoco Project, 3.75%, 5/1/98(2) ........... 5,265,000 5,265,000
------------
289,889,985
------------
UTAH-1.0%
UT GOB, 5%, 7/1/98 .................................................... 7,600,000 7,645,424
UT HFA MH RRB, Candlestick Apts. Project, 4%(1) ....................... 6,400,000 6,400,000
Weber Cnty., UT IDV RRB, Parker Properties, Inc. Project, 4%(1) ....... 2,600,000 2,600,000
------------
16,645,424
------------
VERMONT-0.3%
VT Educational & Health Buildings Financing Agency RB,
Middlebury College Project, Series 1988A, 3.95%, 5/1/98(2) ........ 4,700,000 4,700,000
VT IDAU RB, Sherbern Corp., Series 1998, 4.16%(1) ..................... 1,005,000 1,005,000
------------
5,705,000
------------
WASHINGTON-1.5%
Port Longview, WA IDV RB, Longview Fibre Co. Project, 4.05%(1) ........ 5,000,000 5,000,000
Redmond, WA Public Corp. Industrial RRB, Genie Industries:
Lot 1, 4%(1) ...................................................... 1,010,000 1,010,000
Lot 2, 4%(1) ...................................................... 1,725,000 1,725,000
Seattle, WA IDV Corp. RB, 4%(1) ....................................... 4,500,000 4,500,000
WA GORB, Series 1995C, 4.05%(1) ....................................... 13,100,000 13,100,000
------------
25,335,000
------------
</TABLE>
12
<PAGE> 13
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
--------------- ---------------
WEST VIRGINIA-0.3%
<S> <C> <C>
Beckley, WV RAN, Series A, 4.15%(1) ............................. $ 1,500,000 $ 1,500,000
Cabell Cnty., WV BOE GOB, MBIA Insured, 8%, 5/1/98 .............. 2,625,000 2,659,362
---------------
4,159,362
---------------
WYOMING-0.2%
Uinta Cnty., WY PC RB, AMOCO Standard Oil Co. of Indiana Project,
3.85%, 12/1/98(2) ........................................... 3,000,000 3,000,000
---------------
U.S. POSSESSIONS-3.8%
PR CMWLTH Tax & RAN, Series A, 4.50%, 7/30/98 ................... 64,000,000 64,270,487
---------------
Total Investments, at Value ..................................... 105.7% 1,778,250,852
Liabilities in Excess of Other Assets ........................... (5.7) (95,621,624)
---- ---------------
Net Assets ...................................................... 100.0% $ 1,682,629,228
===== ===============
</TABLE>
13
<PAGE> 14
STATEMENT OF INVESTMENTS December 31, 1997 (Unaudited)(Continued)
Centennial Tax Exempt Trust
To simplify the listing of securities, abbreviations are used per the table
below:
<TABLE>
<S> <C>
BOE--Board of Education IDA--Industrial Development Agency
CD--Commercial Development IDAU--Industrial Development Authority
CDC--Community Development Corp. LGAC--Local Government Assistance Corp.
CMWLTH--Commonwealth L.I.--Long Island
COP--Certificates of Participation MCFFA--Medical Care Facilities Finance Agency
DA--Dormitory Authority MH--Multifamily Housing
DAU--Development Authority MTAU--Metropolitan Transportation Authority
ED--Economic Development MUD--Municipal Utility District
EDAU--Economic Development Authority NYC--New York City
EDFAU--Economic Development Finance Authority NYS--New York State
ERDAUEF--Energy Research & Development PAU--Power Authority
Authority Electric Facilities PC--Pollution Control
ERDAUPC--Energy Research & Development PCFAU--Pollution Control Finance Authority
Authority Pollution Control POAU--Port Authority
FA--Facilities Authority PPA--Public Power Agency
FAU--Finance Authority RA--Redevelopment Agency
GOB--General Obligation Bonds RAN--Revenue Anticipation Nts.
GORB--General Obligation Refunding Bonds RB--Revenue Bonds
HA--Hospital Authority RR--Resource Recovery
HAU--Housing Authority RRB--Revenue Refunding Bonds
HDAU--Hospital Development Authority SCDAU--Statewide Communities Development
HDC--Housing Development Corp. Authority
HEAU--Higher Education Authority SFM--Single Family Mortgage
HEFAU--Higher Educational Facilities Authority SPAST--Special Assessment
HF--Health Facilities SPO--Special Obligations
HFA--Housing Finance Agency SWD--Solid Waste Disposal
HFAU--Health Facilities Authority TBTAU--Triborough Bridge & Tunnel Authority
HFFAU--Health Facilities Finance Authority TUAU--Turnpike Authority
IDV--Industrial Development WSS--Water & Sewer System
</TABLE>
1. Floating or variable rate obligation maturing in more than one year. The
interest rate, which is based on specific, or an index of, market interest
rates, is subject to change periodically and is the effective rate on
December 31, 1997. This instrument may also have a demand feature which
allows, on up to 30 days' notice, the recovery of principal at any time, or
at specified intervals not exceeding one year.
2. Put obligation redeemable at full face value on the date reported.
3. Security issued in exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $9,400,000, or 0.56% of
the Trust's net assets and have been determined to be liquid pursuant to
guidelines adopted by the Board of Trustees.
See accompanying Notes to Financial Statements.
14
<PAGE> 15
STATEMENT OF ASSETS AND LIABILITIES December 31, 1997 (Unaudited)
Centennial Tax Exempt Trust
<TABLE>
ASSETS:
<S> <C>
Investments, at value ........................................ $ 1,778,250,852
Cash ......................................................... 488,010
Receivables:
Shares of beneficial interest sold ......................... 34,135,388
Interest ................................................... 14,920,056
Other ........................................................ 1,362,739
---------------
Total assets ............................................. 1,829,157,045
---------------
LIABILITIES:
Payables and other liabilities:
Investments purchased ...................................... 117,147,000
Shares of beneficial interest redeemed ..................... 28,738,957
Service plan fees .......................................... 163,741
Transfer and shareholder servicing agent fees .............. 121,256
Dividends .................................................. 22,849
Trustees' fees ............................................. 1,159
Other ...................................................... 332,855
---------------
Total liabilities ........................................ 146,527,817
---------------
NET ASSETS ................................................... $ 1,682,629,228
===============
COMPOSITION OF NET ASSETS:
Paid-in capital .............................................. $ 1,682,671,711
Accumulated net realized loss on investment transactions ..... (42,483)
---------------
NET ASSETS-applicable to 1,682,687,678 shares of beneficial
interest outstanding ..................................... $ 1,682,629,228
===============
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $ 1.00
</TABLE>
See accompanying Notes to Financial Statements.
15
<PAGE> 16
STATEMENT OF OPERATIONS For the Six Months Ended December 31, 1997 (Unaudited)
Centennial Tax Exempt Trust
<TABLE>
<S> <C>
INVESTMENT INCOME-Interest ......................... $ 34,461,749
------------
EXPENSES:
Management fees-Note 3 ............................. 3,820,848
Service plan fees-Note 3 ........................... 1,803,915
Transfer and shareholder servicing agent fees-Note 3 440,853
Custodian fees and expenses ........................ 79,456
Shareholder reports ................................ 64,999
Registration and filing fees ....................... 40,182
Legal and auditing fees ............................ 18,378
Trustees' fees and expenses ........................ 10,449
Insurance expenses ................................. 6,342
Other .............................................. 800
------------
Total expenses ..................................... 6,286,222
------------
NET INVESTMENT INCOME .............................. 28,175,527
------------
NET REALIZED LOSS ON INVESTMENTS ................... (28,847)
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 28,146,680
============
</TABLE>
===============================================================================
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months Ended
December 31, 1997 Year Ended
(Unaudited) June 30, 1997
----------------- ---------------
OPERATIONS:
<S> <C> <C>
Net investment income ....................................... $ 28,175,527 $ 46,978,389
Net realized gain (loss) .................................... (28,847) 116,199
--------------- ---------------
Net increase in net assets resulting from operations ........ 28,146,680 47,094,588
--------------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS ................. (28,294,290) (47,224,231)
--------------- ---------------
BENEFICIAL INTEREST TRANSACTIONS:
Net increase in net assets resulting from beneficial interest
transactions-Note 2 ..................................... 34,030,709 222,881,798
--------------- ---------------
NET ASSETS:
Total increase .............................................. 33,883,099 222,752,155
Beginning of period ......................................... 1,648,746,129 1,425,993,974
--------------- ---------------
End of period ............................................... $ 1,682,629,228 $ 1,648,746,129
=============== ===============
</TABLE>
See accompanying Notes to Financial Statements.
16
<PAGE> 17
FINANCIAL HIGHLIGHTS
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Six Months
Ended
December 31,
(Unaudited) Year Ended June 30,
------------- -------------------------------------------------------------------
1997 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ----
PER SHARE OPERATING DATA:
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ................................. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from investment
operations-net investment
income and net realized gain .............. .02 .03 .03 .03 .02 .02
Dividends and distributions to shareholders ... (.02) (.03) (.03) (.03) (.02) (.02)
----- ----- ---- ----- ----- -----
Net asset value, end of period ................ $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ==== ===== ===== =====
TOTAL RETURN, AT
NET ASSET VALUE(1) ........................ 1.60% 3.01% 3.16% 3.17% 1.90% 2.19%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in millions) ....... $1,683 $1,649 $1,426 $1,315 $1,039 $981
Average net assets (in millions) .............. $1,791 $1,591 $1,473 $1,127 $1,057 $977
Ratios to average net assets:
Net investment income ......................... 3.12%(2) 2.95% 3.12% 3.13% 1.87% 2.08%
Expenses(3) ................................... 0.70%(2) 0.72% 0.72% 0.73% 0.76% 0.76%
</TABLE>
1. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends reinvested in additional
shares on the reinvestment date, and redemption at the net asset value
calculated on the last business day of the fiscal period. Total returns are
not annualized for periods of less than one full year. Total returns
reflect changes in net investment income only.
2. Annualized.
3. Beginning in the fiscal year ended June 30, 1995, the expense ratio
reflects the effect of gross expenses paid indirectly by the Trust. Prior
year expense ratios have not been adjusted.
See accompanying Notes to Financial Statements.
17
<PAGE> 18
NOTES TO FINANCIAL STATEMENTS (Unaudited)
Centennial Tax Exempt Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial Tax Exempt Trust (the Trust) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Trust's investment objective is to seek the maximum
short-term interest income exempt from Federal income taxes that is consistent
with low capital risk and the maintenance of liquidity by investing in
short-term municipal securities. The Trust's investment advisor is Centennial
Asset Management Corporation (the Manager), a subsidiary of OppenheimerFunds,
Inc. (OFI). The following is a summary of significant accounting policies
consistently followed by the Trust.
Investment Valuation-Portfolio securities are valued on the basis of
amortized cost, which approximates market value.
Federal Taxes-The Trust 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 to shareholders. Therefore, no federal
income or excise tax provision is required.
Distributions to Shareholders-The Trust intends to declare dividends
from net investment income each day the New York Stock Exchange is open for
business and pay such dividends monthly. To effect its policy of maintaining a
net asset value of $1.00 per share, the Trust may withhold dividends or make
distributions of net realized gains.
Other-Investment transactions are accounted for on the date the
investments are purchased or sold (trade date). Realized gains and losses on
investments are determined on an identified cost basis, which is the same basis
used for federal income tax purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
Six Months Ended December 31, 1997 Year Ended June 30, 1997
---------------------------------- --------------------------------
Shares Amount Shares Amount
------------- ------------ ---------- ----------
<S> <C> <C> <C> <C>
Sold ...................... 2,607,653,057 $ 2,607,653,057 4,793,933,452 $ 4,793,933,452
Dividends and distributions
reinvested .............. 29,414,712 29,414,712 45,861,059 45,861,059
Redeemed .................. (2,603,037,060) (2,603,037,060) (4,616,912,713) (4,616,912,713)
--------------- --------------- --------------- ---------------
Net increase .............. 34,030,709 $ 34,030,709 222,881,798 $ 222,881,798
=============== =============== =============== ===============
</TABLE>
18
<PAGE> 19
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Centennial Tax Exempt Trust
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Trust which provides for a fee of 0.50% of the first
$250 million of net assets; 0.475% of the next $250 million of net assets; 0.45%
of the next $250 million of net assets; 0.425% of the next $250 million of net
assets; 0.40% of the next $250 million of net assets; 0.375% of the next $250
million of net assets; 0.35% of the next $500 million of net assets and 0.325%
of net assets in excess of $2 billion. Until Trust net assets reach $1.5
billion, the annual fee payable to the Manager will be reduced by $100,000.
Shareholder Services, Inc. (SSI), a subsidiary of OFI, is the transfer and
shareholder servicing agent for the Trust and for other registered investment
companies. SSI's total costs of providing such services are allocated ratably to
these companies.
Expenses paid indirectly represent a reduction of custodian fees for earnings on
cash balances maintained by the Trust.
Under an approved service plan, the Trust may expend up to 0.20% of its net
assets annually to reimburse the Manager, as distributor, for costs incurred in
connection with the personal service and maintenance of accounts that hold
shares of the Trust, including amounts paid to brokers, dealers, banks and other
institutions. During the six months ended December 31, 1997, the Trust paid
$3,261 broker/dealer affiliated with the Manager as reimbursement for
distribution-related expenses.
19
<PAGE> 20
CENTENNIAL TAX EXEMPT TRUST
Officers and Trustees
James C. Swain, Chairman
and Chief Executive Officer
Bridget A. Macaskill, Trustee and President
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee
Sam Freedman, Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
George C. Bowen, Trustee, Vice President,
Treasurer and Assistant Secretary
Andrew J. Donohue, Vice President
and Secretary
Michael A. Carbuto, Vice President
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
Investment Advisor and Distributor
Centennial Asset Management Corporation
Transfer and Shareholder Servicing Agent
Shareholder Services, Inc.
Custodian of Portfolio Securities
Citibank, N.A.
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 Trust without examination of the independent auditors.
This is a copy of a report to shareholders of Centennial Tax Exempt
Trust. This report must be preceded or accompanied by a Prospectus of
Centennial Tax Exempt Trust. For material information concerning the
Trust, see the Prospectus.
For shareholder servicing call:
1-800-525-9310 (in U.S.)
303-671-3200 (outside U.S.)
Or write:
Shareholder Services, Inc.
P.O. Box 5143
Denver, CO 80217-5143
RS0160.001.1297 [RECYCLE LOGO] Printed on recycled paper
1997 SEMIANNUAL REPORT
CENTENNIAL
TAX EXEMPT
TRUST
DECEMBER 31, 1997
