<PAGE>
OPPENHEIMER EQUITY INCOME FUND
ANNUAL REPORT JUNE 30, 1994
[LOGO]
"I NEED INCOME AND GROWTH FROM MY INVESTMENT, BUT NOT WITH A LOT OF RISK.
"THIS FUND INVESTS IN A DIVERSIFIED PORTFOLIO OF STOCKS AND BONDS. THAT MEANS
I'VE RECEIVED CURRENT INCOME FOR THE THINGS I NEED TODAY, AND GROWTH FOR THE
THINGS I'LL WANT TOMORROW."
<PAGE>
FUND FACTS
FACTS EVERY SHAREHOLDER SHOULD KNOW ABOUT
OPPENHEIMER EQUITY INCOME FUND
IN THIS REPORT:
ANSWERS TO THREE TIMELY QUESTIONS YOU SHOULD ASK YOUR FUND'S MANAGERS.
- - DID THE FEDERAL RESERVE'S MOVES TO RAISE SHORT-TERM INTEREST RATES AFFECT THE
FUND'S PERFORMANCE OR INVESTMENT STRATEGY?
- - WHY IS THE FUND PUTTING SO MUCH EMPHASIS ON CONVERTIBLE SECURITIES?
- - WHAT'S DRIVING THE FUND'S BUYING AND SELLING IN TODAY'S MARKETS?
1 The Fund's objectives are primarily to seek as much current income
as prudent investing will allow, and secondarily to preserve capital while
providing an opportunity for capital appreciation.
2 Total return at net asset value for Class A shares was 0.65% for the
12 months ended June 30, 1994. For Class B shares, total return at net asset
value from inception of the Class on August 17, 1993 to June 30, 1994 was
-2.35%.(1)
3 Average annual total returns for Class A shares for the 1-, 5-, and
10-year periods ended June 30, 1994 were -5.14%, 6.67%, and 12.58%,
respectively. For Class B shares, total return since inception on
August 17, 1993 was -7.23%.(2)
4 In recognition of its excellent performance, the Fund's Class A shares
were awarded STAR STAR STAR STAR from Morningstar, Inc. on June 30, 1994. The
Fund was ranked among 1,052 equity funds.(3)
5 "There's more to successful investing than going after gains in rising
markets. It's just as important not to give gains back when the markets turn
down. That's where the Fund's position in convertible securities comes in. By
building our position in convertibles, we've added strong current income and
good capital-gains potential to the portfolio, while holding the Fund's
overall portfolio volatility to below-market levels."
PORTFOLIO MANAGER JOHN DONEY, JUNE 30, 1994
1. Based on the change in net asset value for the periods shown, without
deducting any sales charges.
deducting the maximum initial sales charge of 5.75% on 6/30/93, 6/30/89,
6/30/84, and 6/30/79 respectively, held until 6/30/94. The total return for
Class B shares was based on a hypothetical investment held until 6/30/94, after
deducting the contingent deferred sales charge of 5%.
3. Source: Morningstar Mutual Funds, 6/30/94. Morningstar, Inc., an independent
mutual fund monitoring service, produces proprietary monthly rankings of mutual
funds in broad investment categories (equity, taxable bond, tax-exempt bond, or
"hybrid") that reflect historical risk-adjusted performance based on a fund's
3-, 5-, and 10-year average annual total returns in excess of 90-day U.S.
Treasury bill returns, after considering expenses and sales charges. Risk is
calculated by a factor that reflects fund performance below 3-month U.S.
Treasury bill returns. Risk and returns are combined to produce star rankings,
reflecting risk-adjusted performance relative to the average fund in a
category.The highest ranking is 5 stars, the lowest, 1 star. Within each
category, 10% of funds received 5 stars, 22.5% received 4 stars. The Fund was
ranked among 1,052 equity funds. Rankings are subject to change. The Fund's
Class A and Class B shares have the same portfolio.
2 Oppenheimer Equity Income Fund
<PAGE>
REPORT TO SHAREHOLDERS
OUTSTANDING TOTAL RETURN
AVERAGE ANNUAL TOTAL RETURN FOR THE
15-YEAR PERIOD ENDED 6/30/94
OPPENHEIMER EQUITY INCOME FUND A5 14.20%
LIPPER EQUITY INCOME FUNDS
AVERAGE6 13.20%
The conservative, disciplined investment philosophy, which has earned
Oppenheimer Equity Income Fund's Class A shares a STAR STAR STAR STAR ranking
from Morningstar, Inc., was once again rewarded for the year ended June 30,
1994.(4)
As noted in the Fund's last report, your managers had been taking
a cautious view of the markets since the fall of 1993. As the stock market
moved to record highs and interest rates fell to post-war lows, the Fund
established a significant position in convertible securities, which hold their
value better than common stocks during market downturns, while providing an
attractive level of current income.
As 1994 opened, this approach paid off. Concerned about future
inflation in the strengthening U.S. economy, the Federal Reserve raised
short-term interest rates four times between early February and mid-May. As
interest rates rose, the bond markets declined and the stock market followed,
but with its conservative posture, your Fund held its value well over the
entire period.
At this writing, the economy seems to be growing at a gradual pace, and
concerns over inflation have somewhat subsided. Nonetheless, uncertainties
remain, and your managers continue to hold to a steady, conservative course.
In recent weeks, your managers added further to the Fund's convertible
position, buying shares in companies including U.S. Surgical, Westinghouse,
of the portfolio, they continued to emphasize financial services firms -
notably regional banks - whose stocks have performed well despite the stock
market's recent volatility.
Your managers also used periods of market strength to take profits in
several issues that performed well in the past, including Santa Fe Pacific,
Union Pacific, General Motors, Baker Hughes, Atlantic Richfield, and MCI. When
the markets weakened, the proceeds were used to buy shares in companies with
promising appreciation prospects - notably Moore Corporation and AMP, Inc.- at
attractive prices.
Looking ahead, the Fund's future appears bright. While there continues
to be some uncertainty on the investment horizon, the economy continues to
grow at a modest, sustainable pace, and inflation remains well under
control - precisely the conditions that have produced good investment gains in
the past.
We appreciate your trust in Oppenheimer Equity Income Fund, and
we look forward to continuing to help you meet your investment goals.
James C. Swain Jon S. Fossel
Chairman, Oppenheimer Equity President, Oppenheimer Equity
Income Fund Income Fund
July 22, 1994
4. See footnote 3, page 2.
5. See footnote 2, page 2.
6. Source: Lipper Analytical Services, Inc., an independent mutual fund
monitoring service, 6/30/94. The Lipper average for the 15-year period ended
6/30/94 was for 18 equity income funds. This average is shown for comparative
purposes only. Lipper performance rankings do not take sales charges into
consideration.
All figures assume reinvestment of dividends and capital gains distributions.
Past performance is not indicative of future results. Investment return and
principal value on an investment in the Fund will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost.
3 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statement of Investments June 30, 1994
Face Market Value
Amount See Note 1
- ------
Repurchase Agreements--11.8%
- ------
Repurchase agreement with First Chicago Capital Markets, 4.22%,
dated 6/30/94, to be repurchased at $220,325,789 on 7/1/94,
collateralized by U.S. Treasury Nts., 3.875%--9.25%, 12/31/94--11/30/98,
with a value of $160,145,242 and by U.S. Treasury Bills, 0%, 6/29/95,
with a value of $64,643,620 (Cost $220,300,000) $220,300,000
$220,300,000
- ------
Indexed Instruments--0.2%
- ------
Citibank 17.30% CD, 7/29/94(7) 1,420,300,000(4) 3,397,956
(Cost $3,516,663)
- ------
Government Obligations--11.4%
- ------
Argentina (Republic of):
Bonds, Bonos de Consolidacion de Deudas:
Series I, 4.375%, 4/1/01(3) (6) 2,842,250(4) 1,566,986
Series I, 4.375%, 4/1/01(3) (6) 4,263,375(4) 2,929,386
Par Bonds, 3.70%, 3/31/23(5) 8,778,700(4) 4,813,469
- ------
Banco Nacional de Comercio Exterior SNC International Finance BV:
9.875% Bonds, 6/24/96 23,150,000 23,844,500
8% Gtd. Matador Bonds, 8/5/03(2) 2,000,000 1,700,000
- ------
Brazil (Federal Republic of) Interest Due and
Unpaid Bonds, 4.31%, 1/1/01(3) 4,950,000 3,446,438
- ------
Canada (Government of) Bonds, Series H62,
9.25%, 10/1/96 55,800,000(4) 40,935,116
Ontario Hydro (Province of) Canada Gtd. Debs.,
10.875%, 1/8/96 16,000,000(4) 11,979,429
Quebec, Canada (Province of) Debs.,
10.25%, 4/7/98 10,000,000(4) 7,440,998
- ------
South Australia (Government of) Bonds, 9%, 9/2/23 3,000,000(4) 2,048,105
- ------
Spain (Kingdom of):
Bonds, 11.45%, 8/30/98 750,000,000(4) 5,968,620
Gtd. Bonds, Bonos y Obligacion del Estado,
12.25%, 3/25/00 250,000,000(4) 2,044,536
- ------
Treasury Corp. of Victoria Gtd. Sr. Nts.,
8.25%, 10/15/03 35,000,000(4) 22,730,937
- ------
U.S. Treasury Nts., 7.875%, 6/30/96 14,200,000 14,661,500
- ------
U.S. Treasury STRIPS, Series 50, 0%, 2/15/14 300,000,000 64,355,392
- ------
Total Government Obligations (Cost $230,834,737) 212,273,224
- ------
Corporate Bonds and Notes--15.0%
- ------
American Medical International, Inc.,
11% Sr. Nts., 10/15/00 4,000,000 4,240,000
- ------
Auburn Hills Trust,
12.375% Gtd. Exch. Ctfs., 5/1/20(3) 5,000,000 6,800,000
- ------
Banco Nacional de Mexico SA,
7% Exch. Sub. Debs., 12/15/99(2) 15,000,000 16,050,000
- ------
Banco Nacional de Obras y Servicios Publicos S.A.,
10.75% Notes, 8/16/96 6,000,000 6,240,000
- ------
Bank of Boston Corp., 7.75% Cv. Sub. Debs., 6/15/11 9,500,000 10,497,500
- ------
Bank of New York Co., Inc. (The),
7.50% Cv. Sub. Debs., 8/15/01 5,000,000 7,481,250
- ------
Box Energy Corp., 8.25% Cv. Sub. Nts., 12/1/02 5,000,000 5,212,500
- ------
Carter Hawley Hale Stores, Inc.,
6.25% Sr. Sub. Nts., 12/31/00 7,800,000 7,176,000
- ------
Chrysler Financial Corp., 9% Nts., 10/15/94 2,000,000 2,018,840
- ------
Coastal Corp., 11.75% Sr. Debs., 6/15/06 8,946,000 10,075,433
- ------
Comcast Corp., 10.25% Sr. Sub. Debs., 10/15/01 8,000,000 8,000,000
- ------
Delta Airlines, Inc., 3.23% Cv. Sub. Nts., 6/15/03 11,000,000 7,576,250
- ------
Freeport-McMoRan, Inc.,
6.55% Cv. Sub. Nts., 1/15/01 10,120,000 9,057,400
4 Oppenheimer Equity Income Fund
<PAGE>
- ------
Face Market Value
Amount See Note 1
- ------
Corporate Bonds and Notes
(continued)
IMC Fertilizer Group, Inc.,
6.25% Cv. Sub. Nts., 12/1/01 $5,500,000 $5,142,500
- ------
Imo Industries, Inc., 12.25% Sr. Sub. Debs., 8/15/97 9,684,000 9,514,530
- ------
Inco Ltd.:
5.75% Cv. Debs., 7/1/04 9,700,000 9,918,250
7.75% Cv. Debs., 3/15/16 9,800,000 9,849,000
- ------
Intelcom Group, Inc., 7% Cv. Sub. Nts., 10/30/98(2) (6) 5,175,000
- ------
Kroger Co. (The):
6.375% Cv. Jr. Sub. Nts., 12/1/99 10,000,000 13,100,000
8.25% Cv. Jr. Sub. Debs., 4/15/11(2) 14,750,000 15,118,750
- ------
Lend Lease Finance International Ltd.,
4.75% Gtd. Cv. Bonds, 6/1/03(2) 4,000,000 4,290,000
- ------
MagneTek, Inc., 10.75% Sr. Sub. Debs., 11/15/98 3,000,000 3,082,500
- ------
Merrill Lynch & Co., Inc. Equity Participation Securities,
3.06%, 6/30/99 10,000,000 9,575,000
- ------
New South Wales State Bank, 9.25% Bonds, 2/3/18 9,900,000(4) 6,889,854
- ------
Oryx Energy Co., 7.50% Cv. Sub. Debs., 5/15/14 7,000,000 5,976,250
- ------
Reliance Group Holdings, Inc., 9.75% Sr. Sub. Debs., 11/15/03 4,250,000
3,867,500
- ------
RJR Nabisco, Inc., 10.50% Sr. Nts., 4/15/98 14,000,000 14,853,802
- ------
Rohr, Inc., 7.75% Cv. Sub. Nts., 5/15/04 5,000,000 5,875,000
- ------
Rowan Cos., Inc., 11.875% Sr. Nts., 12/1/01 7,000,000 7,525,000
- ------
Stone Container Corp.,
8.875% Cv. Sr. Sub. Nts., 7/15/00 (2) 5,000,000 7,668,750
- ------
Thomas Nelson, Inc., 5.75% Cv. Nts., 11/30/99(2) 5,000,000 5,387,500
- ------
Time Warner, Inc.:
0% Liq. Yld. Opt. Nts., 12/17/12 30,000,000 9,037,500
8.75% Cv. Sub. Debs., 1/10/15 3,179,000 3,190,921
- ------
Tribasa Toll Road Trust,
10.50% Nts., Series 1993-A, 12/1/11(2) 2,500,000 2,256,250
- ------
Turner Broadcasting System, Inc.,
12% Sr. Sub. Debs., 10/15/01 8,000,000 8,460,000
- ------
U.S. Home Corp., 4.875% Cv. Sub. Debs., 11/1/05 4,350,000 2,816,625
- ------
Viacom International, Inc.,
10.25% Sr. Sub. Nts., 9/15/01 12,000,000 12,150,000
- ------
Total Corporate Bonds and Notes (Cost $268,841,201) 278,587,114
Shares
- ------
Common Stocks--41.8%
- ------
Basic Materials--3.0%
- ------
Aluminum--0.3% Reynolds Metals Co. 100,000 4,800,000
- ------
Chemicals--1.6% Goodrich (B.F.) Co. (The) 200,000 8,700,000
- ------
Imperial Chemical Industries PLC, ADS 225,000 10,687,500
- ------
Lyondell Petrochemical Co. 420,600 10,357,275
- ------
29,744,775
- ------
Paper and Forest
Products--1.0%
Union Camp Corp. 200,000 9,075,000
- ------
Weyerhaeuser Co. 250,000 10,000,000
- ------
19,075,000
- ------
Steel--0.1% Armco, Inc.(1) 360,200 2,026,125
- ------
Consumer Cyclicals--3.2%
- ------
Automobiles--1.5% General Motors Corp. 537,626 27,015,707
- ------
Household Furnishings and
Appliances--0.5%
Maytag Corp. 500,000 9,250,000
- ------
Publishing--0.4% Dun & Bradstreet Corp. (The) 151,000 8,380,500
5 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Retail Stores: General
Merchandise Chains--0.8%
Sears, Roebuck and Co. 300,000 $14,400,000
- ------
Consumer Non-Cyclicals--2.9%
- ------
Healthcare: Diversified--1.2%
- ------
Warner-Lambert Co. 202,000 13,332,000
- ------
21,907,000
- ------
Tobacco--1.7% Philip Morris Cos., Inc. 600,000 30,900,000
- ------
Energy--3.5%
- ------
Oil: Integrated
International--3.1%
Mobil Corp. 176,500 14,406,812
- ------
Royal Dutch Petroleum Co. 201,500 21,081,937
- ------
Texaco, Inc. 251,500 15,184,313
- ------
YPF Sociedad Anonima, Sponsored ADR 300,000 7,162,500
- ------
57,835,562
- ------
Oil Well Services and
Equipment--0.4%
Baker Hughes, Inc. 389,000 7,974,500
- ------
Financial--19.2%
- ------
Financial Services:
Miscellaneous--2.1%
American Express Co. 700,000 18,025,000
- ------
Bear Stearns Cos., Inc. (The) 500,000 8,500,003
- ------
Dean Witter, Discover & Co. 156,124 5,854,650
- ------
Lehman Brothers Holdings, Inc. 140,000 2,117,500
- ------
Merrill Lynch & Co., Inc. 111,000 3,885,000
- ------
38,382,153
- ------
Insurance Brokers--0.7% Marsh & McLennan Cos., Inc. 151,500
12,631,312
- ------
Insurance: Life--
0.6% Reliance Group Holdings, Inc. 2,000,000 10,750,000
- ------
Insurance: Multi-Line--0.3% Allstate Corp. 230,000 5,462,500
- ------
Insurance: Property and
Casualty--1.8%
Continental Corp. 275,000 4,262,500
- ------
General Re Corp. 101,000 11,009,000
- ------
SAFECO Corp. 200,000 11,125,000
- ------
St. Paul Cos., Inc. (The) 200,000 8,025,000
- ------
34,421,500
- ------
Major Banks: Other--2.7% BankAmerica Corp. 500,000 22,875,000
- ------
Magna Group, Inc. 400,000 7,750,000
- ------
Mellon Bank Corp. 350,000 19,687,500
- ------
50,312,500
- ------
Major Banks: Regional--6.9% Banc One Corp. 300,000 10,275,000
- ------
Crestar Financial Corp. 275,000 12,512,500
- ------
First Bank System, Inc. 300,000 10,950,000
- ------
First Fidelity Bancorporation 450,000 20,868,750
- ------
First Union Corp. 300,000 13,837,500
- ------
Huntington Bancshares, Inc. 419,375 10,641,641
- ------
KeyCorp 400,000 12,750,000
- ------
National City Corp. 700,000 19,162,500
- ------
Signet Banking Corp. 181,000 7,307,875
6 Oppenheimer Equity Income Fund
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Major Banks: Regional
(continued)
U.S. Bancorp, Inc. 400,000 $10,350,000
- ------
128,655,766
- ------
Money Center Banks--3.3%
Bankers Trust New York Corp. 114,200 7,608,575
- ------
Chase Manhattan Corp. 700,000 26,775,000
- ------
Chemical Banking Corp. 700,000 26,950,000
- ------
61,333,575
- ------
Savings and
Loans/Holding Cos.--0.8%
Fleet Financial Group, Inc. 400,000 15,100,000
- ------
Industrial--3.6%
- ------
Conglomerates--1.2% Tenneco, Inc. 500,000 23,187,500
- ------
Electrical Equipment--0.7% AMP, Inc. 200,000 13,850,000
- ------
- ------
Transportation:
Miscellaneous--0.7%
Ryder Systems, Inc. 500,000 12,562,500
- ------
Technology--2.4%
- ------
Aerospace/Defense--1.0% United Technologies Corp. 300,000 19,275,000
- ------
Electronics: Instrumentation--0.8%
Tektronix, Inc. 500,000 14,125,000
- ------
Office Equipment and
Supplies--0.6%
Moore Corp. Ltd. 675,200 11,394,000
- ------
Utilities--4.0%
- ------
Electric Cos.--3.3%
American Electric Power Co., Inc. 454,000 12,825,500
- ------
Houston Industries, Inc. 378,500 12,348,562
- ------
Public Service Co. of Colorado 200,000 5,225,000
- ------
Public Service Enterprise Group, Inc. 604,000 15,704,000
- ------
Texas Utilities Co. 504,000 15,813,000
- ------
61,916,062
- ------
Telephone--0.7% BCE, Inc. 403,900 13,076,263
- ------
Total Common Stocks (Cost $679,192,511) 777,462,550
- ------
Preferred Stocks--20.6%
- ------
Alumax, Inc., $19.50 Cv., Series A 100,000 11,500,000
- ------
American Express Co., Debt Exchangeable for Common Stock of First Data Corp.,
6.25%, 10/15/96 557,000 22,001,500
- ------
AMR Corp., $3.00 Cum. Cv. Depositary Shares, Series A(2) 350,000 15,487,500
- ------
Armco, Inc., $3.625 Cum. Cv. 200,000 10,300,000
- ------
Boise Cascade Corp., $1.58 Cum Cv., Series G 460,000 9,890,000
- ------
Bowater, 7% Preferred Redeemable Increased Dividend Equity Securities,
Series B, $6.58 Cv., 1/1/98 95,000 2,315,625
- ------
Case Equipment Corp., Series A Cum. Cv.(2) 130,000 6,511,375
- ------
Chiles Offshore Corp., $1.50 Cv. 122,000 2,775,500
- ------
Chrysler Financial Corp.,
$4.625 Cv. Depositary Shares, Series A(2) 100,000 13,225,000
- ------
Citicorp:
Cv. Depositary Shares, Series 13(2) 200,000 22,450,000
Preferred Equity Redemption Cumulative Stock, $1.217 Cv.
Depositary Shares, Series 15, 11/30/95 500,000 9,812,500
7 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Preferred Stocks (continued) Compania de Inversiones en Telecomunicaciones
SA, Provisionally Redeemable
Income Debt Exchangeable for Stock, 7%, 3/3/98(2) 165,000 $9,817,500
- ------
Cooper Industries, Inc., $1.60 Cv. Exch. 297,000 6,756,750
- ------
Cyprus Amax Minerals Co., $4.00 Cv., Series A 150,000 10,106,250
- ------
Delta Airlines, Inc.,
$3.50 Cv. Depositary Shares, Series C 182,000 8,235,500
- ------
First Chicago Corp.,
$2.875 Cum. Cv. Depositary Shares, Series B 135,000 6,800,625
- ------
Ford Motor Co., $4.20 Cum. Cv., Series A 150,000 14,550,000
- ------
Freeport-McMoRan, Inc., $4.375 Cv. Exch.(2) 200,000 7,500,000
- ------
James River Corp. of Virginia, Dividend Enhanced Convertible Stock 700,000
12,337,500
- ------
K Mart Corp., Preferred Equity Redeemable for Common Stock,
- ------
LCI International, Inc., $1.25 Cv. 80,000 1,960,000
- ------
Occidental Petroleum Corp.:
$3.00 Cv. 281,000 11,626,375
$3.875 Cum. Cv.(2) 400,000 19,725,000
- ------
Parker & Parsley Capital LLC., 6.25% Cum. Cv. Guaranteed Monthly Income
Preferred Shares(2) 112,000 5,866,000
- ------
Reynolds Metals Co., 7% Preferred Redeemable Increased Dividend
Equity Securities, $3.31 Cv., 12/31/97 160,000 7,980,000
- ------
RJR Nabisco Holdings Corp.:
$6.50 Cv., Series C 3,115,000 20,636,875
Preferred Equity Redemption Cumulative Stock, $.835 Cum. Cv.,
Series C Depositary Shares 1,200,000 7,500,000
- ------
Salomon, Inc., 5.25% Hewlett-Packard Co. Common Equity-Linked
Securities, 3/15/97 125,000 9,718,750
- ------
Santa Fe Energy Resources, Inc., Dividend Enhanced Convertible Stock,
$.732 Cv., Series A 805,000 7,748,125
- ------
Sears, Roebuck and Co., Preferred Equity Redeemable for Common Stock,
$3.75 Exch., Series A, Cv., 4/1/95 275,000 15,125,000
- ------
Transco Energy Co., $3.00 Cum. Cv., Series E(2) 147,000 7,092,750
- ------
UAL Corp., $6.25 Cv., Series A(2) 175,000 14,787,500
- ------
U.S. Surgical Corp., Dividend Enhanced Convertible Stock,
$2.20(2) 550,000 13,337,500
- ------
Valero Energy Corp., Cv. 145,000 6,235,000
- ------
Washington Mutual Savings Bank, $6.00 Cv., Series D 96,800 9,171,800
- ------
Westinghouse Electric Corp., Participating Equity Preferred Shares,
$12.125 Cv., Series C(2) 890,000 11,347,500
- ------
Total Preferred Stocks (Cost $364,266,696) 383,149,800
- ------
Total Investments, at Value (Cost $1,766,951,808) 100.8% 1,875,170,644
- ------
Liabilities in Excess of Other Assets (.8) (14,375,994)
- ------ ------
Net Assets 100.0% $1,860,794,650
- ------ ------
- ------ ------
1. Non-income producing security.
2. Restricted security--See Note 5 of Notes to Financial Statements.
3. Represents the current interest rate for a variable rate security.
4. Face amount is reported in foreign currency.
5. Represents the current interest rate for an increasing rate security.
6. Interest is paid in kind.
7. Indexed instrument for which the principal amount due at maturity is affected
by the relative value of a foreign currency. See accompanying Notes to
Financial Statements.
8 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statement of Assets and Liabilities June 30, 1994
- ------
Assets Investments, at value (cost $1,766,951,808)--see accompanying
statement $1,875,170,644
- ------
Receivables:
Dividends and interest 12,901,758
Investments sold 9,173,491
Shares of beneficial interest sold 1,775,082
- ------
Other 85,909
- ------
Total assets 1,899,106,884
- ------
Liabilities Bank overdraft 6,811,592
- ------
Payables and other liabilities:
Investments purchased 22,666,668
Distribution and service plan fees--Note 4 864,631
Other 1,575,078
- ------
Total liabilities 38,312,234
- ------
Net Assets $1,860,794,650
- ------
- ------
- ------
Composition of
Net Assets
Paid-in capital $1,733,061,217
- ------
Distributions in excess of net investment income (3,381,130)
- ------
Accumulated net realized gain from investment and foreign currency transactions
22,864,901
- ------
Net unrealized appreciation on investments and translation of assets and
liabilities
denominated in foreign currencies 108,249,662
- ------
Net assets $1,860,794,650
- ------
- ------
- ------
Net Asset Value
Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$1,772,944,207
and 187,840,921 shares of beneficial interest outstanding) $ 9.44
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $10.02
- ------
Class B shares:
Net asset value, redemption price and offering price per share (based on net
assets of $87,850,443 and 9,340,898 shares of beneficial interest outstanding) $
9.40 See accompanying Notes to Financial Statements.
9 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statement of Operations For the Year Ended June 30, 1994
- ------
Investment Income Interest $54,718,271
- ------
Dividends (net of withholding taxes of $315,970) 50,544,683
- ------
Total income 105,262,954
- ------
Expenses Management fees--Note 4 10,114,770
- ------
Distribution and service plan fees:
Class A--Note 4 2,986,993
Class B--Note 4 411,604
- ------
Transfer and shareholder servicing agent fees--Note 4 2,451,831
- ------
Shareholder reports 527,489
- ------
Custodian fees and expenses 231,210
- ------
Registration and filing fees:
Class A 93,411
Class B 37,554
- ------
Trustees' fees and expenses 71,550
- ------
Legal and auditing fees 68,743
- ------
Other 218,820
- ------
Total expenses 17,213,975
- ------
Net Investment Income 88,048,979
- ------
Realized and Unrealized
Gain (Loss) on Investments
And Foreign Currency
Transactions
Net realized gain (loss) from:
Investments 24,812,847
Foreign currency transactions (1,727,524)
- ------
Net change in unrealized appreciation or depreciation on:
Investments (93,532,224)
Translation of assets and liabilities denominated in foreign currencies
(8,069,199)
- ------
Net realized and unrealized loss on investments and foreign currency
transactions (78,516,100)
- ------
Net Increase in Net Assets Resulting From Operations $9,532,879
- ------
- ------
See accompanying Notes to Financial Statements.
10 Oppenheimer Equity Income Fund
<PAGE>
- ------
Statements of Changes in Net Assets
Year Ended June 30,
1994 1993
- ------
Operations Net investment income $88,048,979 $84,853,288
- ------
Net realized gain on investments and foreign currency transactions
- ------
Net change in unrealized appreciation or depreciation on investments
and translation of assets and liabilities denominated in foreign currencies
(101,601,423) 122,260,203
- ------ ------
Net increase in net assets resulting from operations 9,532,879 259,632,034
- ------
Equalization Net change 546,821 2,468,327
- ------
Dividends and
Distributions to
Shareholders
Dividends from net investment income:
Class A
($.47 per share and $.48 per share, respectively) (85,741,017) (83,156,753)
Class B
($.416 per share) (2,115,733) --
- ------
Dividends in excess of net investment income:
Class A ($.01 per share) (1,829,618) --
Class B ($.01 per share) (45,147) --
- ------
Distributions from net realized gain on investments and foreign
currency transactions:
Class A ($.1221 and $.145 per share, respectively) (22,569,711) (24,974,899)
Class B ($.1221 per share) (515,610) --
- ------
Distributions in excess of capital gains:
Class A ($.05 per share) (8,593,810) --
Class B ($.05 per share) (196,327) --
- ------
Beneficial Interest
Transactions
Net increase in net assets resulting from Class A beneficial interest
transactions--Note 2 88,576,248 80,452,974
- ------
Net increase in net assets resulting from Class B beneficial interest
transactions--Note 2 93,399,883 --
- ------
Net Assets Total increase 70,448,858 234,421,683
- ------
Beginning of year 1,790,345,792 1,555,924,109
- ------ ------
End of year [including undistributed (overdistributed) net investment income of
$(3,381,130) and $29,426,684, respectively] $1,860,794,650 $1,790,345,792
- ------ ------
- ------ ------
See accompanying Notes to Financial Statements.
11 Oppenheimer Equity Income Fund
<PAGE>
- ------
Financial Highlights
Class A Class B
- ------ ------
Period
Ended
Year Ended June 30, June 30,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1994(1)
- ------
Per Share Operating Data:
Net asset value, beginning of period
$10.01 $9.15 $8.86 $9.18 $9.11 $8.51 $9.85 $9.26 $7.78 $6.83 $10.22
- ------
Income from investment operations:
Net investment income
.47 .50 .50 .48 .48 .52 .48 .46 .50 .47 .36
Net realized and unrealized gain
(loss) on investments, options
written and foreign currency transactions
(.39) .99 .39 (.17) .33 .58 (.35) 1.22 1.59 1.48 (.58)
- ------ ------ ------ ------ ------ ------ ------
- ------ ------ ------ ------
Total income from investment operations
.08 1.49 .89 .31 .81 1.10 .13 1.68 2.09 1.95 (.22)
- ------
Dividends and distributions
Dividends from net investment income
(.47) (.48) (.48) (.48) (.50) (.48) (.60) (.48) (.46) (.45) (.42)
Dividends in excess of net investment income
(.01) -- -- -- -- -- -- -- -- -- (.01)
Distributions from net realized gain on investments, options written and foreign
currency transactions
(.12) (.15) (.12) (.15) (.24) (.02) (.87) (.61) (.15) (.55) (.12)
Distributions in excess of capital gains
(.05) -- -- -- -- -- -- -- -- -- (.05)
- ------ ------ ------ ------ ------ ------ ------
- ------ ------ ------ ------
Total dividends and distributions to shareholders
(.65) (.63) (.60) (.63) (.74) (.50) (1.47) (1.09) (.61) (1.00) (.60)
- ------
Net asset value, end of period
$9.44 $10.01 $9.15 $8.86 $9.18 $9.11 $8.51 $9.85 $9.26 $7.78 $9.40
- ------ ------ ------ ------ ------ ------ ------
- ------ ------ ------ ------
- ------ ------ ------ ------ ------ ------ ------
- ------ ------ ------ ------
- ------
<TABLE>
<S> <C>
Total Return, at Net Asset Value(2)
.65% 16.76% 10.26% 3.68% 9.07% 13.30% 2.04% 20.45% 28.42% 32.40% (2.35)%
- ------
Ratios/Supplemental Data:
Net assets, end of period (in thousands)
$1,772,944 $1,790,346 $1,555,924 $1,393,303 $1,329,830 $1,017,074 $806,892 $730,655 $381,122 $134,828 $87,850
- ------
Average net assets (in thousands)
$1,831,606 $1,657,692 $1,525,599 $1,323,858 $1,179,704 $885,179 $743,232 $526,897 $228,642 $98,324 $47,414
- ------
Number of shares outstanding at end of period (in thousands)
187,841 178,819 170,117 157,239 144,921 111,613 94,824 74,169 41,166 17,321 9,341
- ------
Ratios to average net assets:
Net investment income 4.72% 5.12% 5.33% 5.31% 5.10% 5.89% 5.48% 5.08% 6.00% 7.01% 3.99%(3)
Expenses .90% .79% .82% .79% .79% .85% .83% .91% 1.03% 1.11% 1.82%(3)
- ------
Portfolio turnover rate(4) 30.4% 59.0% 37.0% 64.0% 122.0% 91.4% 124.1% 94.7% 105.3% 122.5% 30.4%
</TABLE>
1. For the period from August 17, 1993 (inception of offering) to June 30, 1994.
2. Assumes a 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. Sales charges
are not reflected in the total returns.
3. Annualized.
4. The lesser of purchases or sales of portfolio securities for a year, divided
by the monthly average of the market value of portfolio securities owned during
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the year
ended June 30, 1994 were $543,750,868 and $575,903,141, respectively.
See accompanying Notes to Financial Statements.
12 Oppenheimer Equity Income Fund
<PAGE>
- ------
Notes to Financial Statements
- ------
1. Significant
Accounting Policies
Oppenheimer Equity Income Fund (the Fund) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Fund's investment advisor is Oppenheimer Management
Corporation (the Manager). The Fund offers both Class A and Class B shares.
Class A shares are sold with a front-end sales charge. Class B shares may be
subject to a contingent deferred sales charge. Both classes of shares have
identical rights to earnings, assets and voting privileges, except that each
class has its own distribution and/or service plan, expenses directly
attributable to a particular class and exclusive voting rights with respect to
matters affecting a single class. Class B shares will automatically convert to
Class A shares six years after the date of purchase. The following is a summary
of significant accounting policies consistently followed by the Fund.
- ------
Investment Valuation. Portfolio securities are valued at 4:00 p.m. (New York
time) on each trading day. Listed and unlisted securities for which such
information is regularly reported are valued at the last sale price of the day
or, in the absence of sales, at values based on the closing bid or asked price
or the last sale price on the prior trading day. Long-term debt securities are
valued by a portfolio pricing service approved by the Board of Trustees.
Long-term debt securities which cannot be valued by the approved portfolio
pricing service are valued by averaging the mean between the bid and asked
prices obtained from two active market makers in such securities. Short-term
debt securities having a remaining maturity of 60 days or less are valued at
cost (or last determined market value) adjusted for amortization to maturity of
any premium or discount. Securities for which market quotes are not readily
available are valued under procedures established by the Board of Trustees to
determine fair value in good faith.
- ------
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 securities and investment income are translated at
the rates of exchange prevailing on the respective dates of such transactions.
The Fund generally enters into forward currency exchange contracts as a
hedge, upon the purchase or sale of a security denominated in a foreign
changes in foreign currency exchange rates on portfolio positions. A forward
exchange is a commitment to purchase or sell a foreign currency at a future
date, at a negotiated rate. Risks may arise from the potential inability of the
counterparty to meet the terms of the contract and from unanticipated movements
in the value of a foreign currency relative to the U.S. dollar.
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 results of operations.
- ------
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. 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 and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and 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.
13 Oppenheimer Equity Income Fund
<PAGE>
- ------
Notes to Financial Statements (Continued)
- ------
1. Significant
Accounting Policies
(continued)
Federal Income 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. Therefore, no
federal income tax provision is required.
- ------
Equalization. Prior to September 24, 1993, the Fund followed the accounting
practice of equalization, by which a portion of the proceeds from sales and
costs of redemptions of Fund shares equivalent on a per share basis to the
amount of undistributed net investment income were credited or charged to
undistributed income. The cumulative effect of the change in accounting practice
resulted in a reclassification of $32,950,419 from undistributed net investment
income to paid-in capital.
- ------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- ------
Change in Accounting for Distributions to Shareholders. Effective July 1, 1993,
the Fund adopted Statement of Position 93-2: Determination, Disclosure, and
Financial Statement Presentation of Income, Capital Gain, and Return of Capital
classification of distributions to shareholders to better disclose the
differences between financial statement amounts and distributions determined in
accordance with income tax regulations. Accordingly, subsequent to June 30,
1993, amounts have been reclassified to reflect a decrease in paid-in capital of
$7,105,629, an increase in undistributed net investment income of $3,005,844,
and an increase in undistributed capital gain on investments of $4,099,785.
During the year ended June 30, 1994, in accordance with Statement of Position
93-2, undistributed income was decreased by $1,727,524 and undistributed capital
gain on investments was increased by $1,727,524.
- ------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
Realized gains and losses on investments and unrealized appreciation and
depreciation are determined on an identified cost basis, which is the same basis
used for federal income tax purposes. Interest on payment-in-kind debt
instruments is accrued as income at the coupon rate and a market adjustment is
made on the ex-date.
- ------
2. Shares of
Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest of each class. Transactions in shares of beneficial interest were as
follows:
Year Ended June 30, 1994(1) Year Ended June 30, 1993
- ------ ------
Shares Amount Shares Amount
- ------
Class A:
Sold 26,551,307 $264,515,469 29,572,911 $276,573,097
Dividends and distributions reinvested
11,168,493 110,189,163 10,613,035 97,981,463
Redeemed (28,698,217) (286,128,384) (31,483,466) (294,101,586)
- ------ ------ ------ ------
Net increase 9,021,583 $88,576,248 8,702,480 $80,452,974
- ------ ------ ------ ------
- ------ ------ ------ ------
- ------
Class B:
Sold 9,581,829 $95,687,102 -- $--
Dividends and distributions reinvested 266,194 2,603,845 -- --
Redeemed (507,125) (4,891,064) -- --
- ------ ------ ------ ------
Net increase 9,340,898 $93,399,883 -- $--
- ------ ------ ------ ------
- ------ ------ ------ ------
1. For the year ended June 30, 1994 for Class A shares and for the period from
August 17, 1993 (inception of offering) to June 30, 1994 for Class B shares.
14 Oppenheimer Equity Income Fund
<PAGE>
- ------
- ------
3. Unrealized Gains and
Losses on Investments
At June 30, 1994, net unrealized appreciation on investments of $108,218,836 was
composed of gross appreciation of $187,771,512, and gross depreciation of
- ------
4. Management Fees and
Other Transactions
With Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of .75% on
the first $100 million of net assets with a reduction of .05% on each $100
million thereafter, to .50% on net assets in excess of $500 million. The Manager
has agreed to reimburse the Fund if aggregate expenses (with specified
exceptions) exceed 1.5% of the first $30 million of average annual net assets of
the Fund, plus 1% of average annual net assets in excess of $30 million.
For the year ended June 30, 1994, commissions (sales charges paid by
investors) on sales of Class A shares totaled $7,807,280, of which $2,506,452
was retained by Oppenheimer Funds Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated broker/dealer. During the
period ended June 30, 1994, OFDI received contingent deferred sales charges of
$65,013 upon redemption of Class B shares, as reimbursement for sales
commissions advanced by OFDI at the time of sale of such shares.
Oppenheimer Shareholder Services (OSS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund, and for other registered
investment companies. OSS's total costs of providing such services are allocated
ratably to these companies.
Under separate approved plans, each class may expend up to .25% of its net
assets annually to reimburse OFDI for costs incurred in connection with the
personal service and maintenance of accounts that hold shares of the Fund (prior
to October 1, 1993, Class A reimbursements were made with respect to shares sold
subsequent to March 31, 1991), including amounts paid to brokers, dealers, banks
and other institutions. In addition, Class B shares are subject to an
asset-based sales charge of .75% of net assets annually, to reimburse OFDI for
sales commissions paid from its own resources at the time of sale and associated
financing costs. In the event of termination or discontinuance of the Class B
plan, the Board of Trustees may allow the Fund to continue payment of the
asset-based sales charge to OFDI for distribution expenses incurred on Class B
shares sold prior to termination or discontinuance of the plan. During the year
ended June 30, 1994, OFDI paid $195,662 to an affiliated broker/dealer as
reimbursement for Class A personal service and maintenance expenses and retained
$411,604 as reimbursement for Class B sales commissions and service fee
advances, as well as financing costs.
- ------
5. Restricted Securities
The Fund owns securities purchased in private placement transactions, without
registration under the Securities Act of 1933 (the Act). The securities are
valued under methods approved by the Board of Trustees as reflecting fair value.
time of purchase) in restricted and illiquid securities, excluding securities
eligible for resale pursuant to Rule 144A of the Act that are determined to be
liquid by the Board of Trustees or by the Manager under Board-approved
guidelines. Restricted and illiquid securities amount to $8,003,959, or .43% of
the Fund's net assets, at June 30, 1994.
Valuation
Cost Per Per Unit as of
Security Acquisition Date Unit June 30, 1994
- ------
AMR Corp., $3.00 Cum. Cv. Depositary Shares,
Series A Preferred Stock(1) 1/28/93--2/25/93 $49.82 $ 44.25
- ------
Banco Nacional de Comercio Exterior SNC
International Finance BV, 8% Gtd.
Matador Bonds, 8/5/03(1) 11/12/93 $97.88 $ 85.00
- ------
Banco Nacional de Mexico SA, 7% Exch.
Sub. Debs., 12/15/99(1) 12/1/92 $100.00 $107.00
- ------
Case Equipment Corp., Series A Cum. Cv.
Preferred Stock(1) 6/30/94 $50.09 $ 50.09
- ------
Chrysler Financial Corp., $4.625 Cv. Depositary
Shares, Series A Preferred Stock(1) 2/12/92 $50.00 $132.25
- ------
Citicorp, Cv. Depositary Shares, Series 13
Preferred Stock(1) 9/4/92--9/25/92 $62.94 $112.25
15 Oppenheimer Equity Income Fund
<PAGE>
- ------
Notes to Financial Statements (Continued)
- ------
5. Restricted Securities
(continued)
Valuation
Cost Per Per Unit as of
Security Acquisition Date Unit June 30, 1994
- ------
Compania de Inversiones en Telecomunicaciones
SA, Provisionally Redeemable Income Debt
Exchangeable for Stock, 7%, 3/3/98(1) 2/28/94 $72.00 $ 59.50
- ------
Freeport-McMoRan, Inc., $4.375 Cv. Exch. Preferred Stock(1)
2/26/92 $45.63 $ 37.50
- ------
Intelcom Group, Inc.,
7% Cv. Sub. Nts., 10/30/98 10/26/93--4/27/94 $99.43 $ 50.56
- ------
Kroger Co. (The),
8.25% Cv. Jr. Sub. Debs., 4/15/11(1) 3/6/91 $100.00 $102.50
- ------
Lend Lease Financial International Ltd., 4.75%
Gtd. Cv. Bonds, 6/1/03(1) 6/10/93 $100.00 $107.25
- ------
Occidental Petroleum Corp., $3.875 Cum. Cv.
Preferred Stock(1) 2/10/93 $50.00 $49.31
- ------
Parker & Parsley Capital LLC., 6.25% Cum. Cv.
Guaranteed Monthly Income Preferred Shares(1) 3/24/94 $50.00 $52.38
- ------
Stone Container Corp.,
8.875% Cv. Sr. Sub. Nts., 7/15/00(1) 6/24/93 $99.36 $153.38
- ------
Thomas Nelson, Inc.,
5.75% Cv. Nts., 11/30/99 11/11/92 $100.00 $107.75
- ------
Transco Energy Co., $3.00 Cum. Cv., Series E
Preferred Stock (1) 10/29/93 $50.00 $ 48.25
- ------
Tribasa Toll Road Trust, 10.50% Nts., Series
1993-A, 12/1/11(1) 11/15/93 $100.00 $ 90.25
- ------
UAL Corp., $6.25 Cv., Series A Preferred Stock(1)
2/5/93--2/25/93 $99.55 $ 84.50
- ------
U.S. Surgical Corp., Dividend Enhanced
- ------
Westinghouse Electric Corp., Participating
Equity Preferred Shares $12.125 Cv., Series C(1) 3/24/94 $14.44 $
12.75
1. Transferable under Rule 144A of the Act.
- ------
Federal Income Tax Information (Unaudited)
- ------
In early 1995, shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1994. Regulations of
the U.S. Treasury Department require the Fund to report this information to the
Internal Revenue Service.
A distribution of $.1721 per share was paid on December 28, 1993, of which
$.1551 was designated as a ``capital gain distribution'' for federal income tax
purposes. Whether received in stock or cash, the capital gain distribution
should be treated by shareholders as a gain from the sale of capital assets held
for more than one year (long-term capital gains).
Dividends paid by the Fund during the fiscal year ended June 30, 1994 which
are not designated as capital gain distributions should be multiplied by 55.7%
to arrive at the net amount eligible for the corporate dividend-received
deduction.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
16 Oppenheimer Equity Income Fund
<PAGE>
- ------
Independent Auditors' Report
- ------
The Board of Trustees and Shareholders of Oppenheimer Equity Income Fund:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Oppenheimer Equity Income Fund as of June 30,
1994, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended June 30, 1994 and 1993,
and the financial highlights for the period July 1, 1984 to June 30, 1994. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit also includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at June 30,
1994 by correspondence with the custodian and brokers; where replies were not
received from brokers, we performed other auditing procedures. An audit also
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Oppenheimer Equity
Income Fund at June 30, 1994, the results of its operations, the changes in its
net assets, and the financial highlights for the respective stated periods, in
conformity with generally accepted accounting principles.
DELOITTE & TOUCHE
Denver, Colorado
July 22, 1994
17 Oppenheimer Equity Income Fund
<PAGE>
- ------
Oppenheimer Equity Income Fund
- ------
Officers and Trustees James C. Swain, Chairman and Chief Executive Officer
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee and President
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
Andrew J. Donohue, Vice President
John P. Doney, Vice President
George C. Bowen, Vice President, Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
- ------
Investment Advisor Oppenheimer Management Corporation
- ------
Distributor Oppenheimer Funds Distributor, Inc.
- ------
Transfer and Shareholder
Servicing Agent
Oppenheimer Shareholder Services
- ------
Custodian of
Portfolio Securities
The Bank of New York
- ------
Independent Auditors Deloitte & Touche
- ------
Legal Counsel Myer, Swanson & Adams, P.C.
This is a copy of a report to shareholders of Oppenheimer Equity Income Fund.
This report must be preceded or accompanied by a Prospectus of Oppenheimer
Equity Income Fund. For material information concerning the Fund, see the
Prospectus.
18 Oppenheimer Equity Income Fund
<PAGE>
- ------
The Family of OppenheimerFunds
- ------
OppenheimerFunds offers over 30 funds designed to fit virtually every investment
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prospectus carefully before you invest.
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OppenheimerFunds are distributed by Oppenheimer Funds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203.
(C) Copyright 1994 Oppenheimer Management Corporation. All rights reserved.
19 Oppenheimer Equity Income Fund
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"HOW MAY I HELP YOU?"
GENERAL INFORMATION
1-800-525-7048
Talk to a Customer Service Representative.
Monday through Friday from
8:30 a.m. to 8:00 p.m., and Saturday from 10:00 a.m.
to 2:00 p.m. ET.
TELEPHONE TRANSACTIONS
1-800-852-8457
Make account transactions with a Customer Service Representative.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
PHONELINK
1-800-533-3310
Get automated information or make automated transactions.
24 hours a day, 7 days a week.
TELECOMMUNICATION
DEVICE FOR THE DEAF
1-800-843-4461
Service for the hearing impaired.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
OPPENHEIMERFUNDS
INFORMATION HOTLINE
1-800-835-3104
Hear timely and insightful messages on the economy and issues that affect your
finances. 24 hours a day, 7 days a week.
"Just as OppenheimerFunds offers over 30 different mutual funds designed to
help meet virtually every investment need, Oppenheimer Shareholder Services
offers a variety of services to satisfy your individual needs. Whenever you
require help, we're only a toll-free phone call away.
"For personalized assistance and account information, call our General
Information number to speak with our knowledgeable Customer Service
Representatives and get the help you need.
"When you want to make ac count transactions, it's easy for you to redeem
shares, exchange shares, or conduct AccountLink transactions, simply by
calling our Telephone Transactions number.
response system is available 24 hours a day, 7 days a week. PhoneLink gives
you access to a variety of fund, account, and market information. You can even
make purchases, exchanges and redemptions using your touch-tone phone. Of
course, PhoneLink will always give you the option to speak with a Customer
Service Representative during the hours shown to the left.
"When you invest in OppenheimerFunds, you know you'll receive a high level of
customer service. The International Customer Service Association knows it, too,
as it awarded Oppenheimer Shareholder Services a 1993 Award of Excellence for
consistently demonstrating superior customer service.
"Whatever your needs, we're ready to assist you."
[PHOTO]
Barbara Hennigar
Chief Executive Officer
Oppenheimer Shareholder Services
RA300.0794.N
[LOGO]
1993
AWARD OF EXCELLENCE
ICSA
INTERNATIONAL CUSTOMER
SERVICE ASSOCIATION
[LOGO]
OPPENHEIMER FUNDS.
Bulk Rate
U.S. Postage
PAID
Permit No. 377
Hackensack, NJ
