[FRONT COVER]
Oppenheimer Fund
Annual Report June 30, 1996
[Picture of Walk in Park]
"We have
some important
goals, so
our money
needs to
grow solidly
over time."
[LOGO-OPPENHEIMERFUNDS(R)]
<PAGE>
This Fund is for people who want the potential for solid growth over time from a
highly diversified investment.
How Your Fund Is Managed
Oppenheimer Fund seeks capital appreciation and income consistent with growth in
capital. It uses a combination of five distinct investment styles, which can
also help manage risk.
The Fund's managers invest in stocks of established U.S. and international
companies they believe have excellent potential for growth. They use a "value"
approach, which emphasizes undervalued companies; a "contrarian" approach,
which seizes opportunities in out-of-favor industries they believe to be poised
for rebound; and a "growth" approach, which seeks companies the managers believe
have above-average growth rates.
The Fund's managers seek balance from international stocks and income from
high yield stocks and bonds to help cushion the portfolio against fluctuations
in the U.S. stock market.
Performance
Total return at net asset value for the twelve months ended 6/30/96 was 17.56%
for Class A shares and 16.51% for Class C shares. Cumulative total return at
net asset value for Class B shares since inception on 11/1/95 was 11.86%.(1)
Your Fund's average annual total returns at maximum offering price for
Class A shares for the 1-, 5-, and 10-year periods ended 6/30/96 were 10.80%,
12.07% and 8.41%, respectively. For Class B shares, cumulative total return
since inception on 11/1/95 was 6.86%. For Class C shares, average annual total
returns for the 1-year period and since inception of the Class on 12/1/93 were
15.51% and 12.79%, respectively.(2)
Outlook
"Despite the volatility we experienced in the first half of 1996, our long-term
outlook is positive. Whether stocks continue to climb at an accelerated pace or
experience more normal growth, we believe the Fund, through its broad
diversification, is well-positioned to respond with competitive returns and
lower-than-average risk."
Richard Rubinstein, Portfolio Manager
June 30, 1996
Total returns include change in share price and reinvestment of dividends and
capital gains distributions. Past performance does not guarantee future results.
Investment return and principal value of 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. For more complete information, please review the
prospectus carefully before you invest.
1. Based on the change in net asset value per share for the period shown,
without deducting any sales charges. Such performance would have been lower if
sales charges were taken into account.
2. Class A returns show results of hypothetical investments on 6/30/95, 6/30/91
and 6/30/86, after deducting the current maximum initial sales charge of 5.75%.
Class A shares were first publicly offered on 4/30/59. Class B returns show
results of a hypothetical investment on 11/1/95 (inception of class), after the
deduction of the 5% contingent deferred sales charge. Class C returns show
results of hypothetical investments on 6/30/95 and 12/1/93 (inception of class),
with the 1% contingent deferred sales charge deducted for the 1-year result. The
Fund's maximum sales charge rate for Class A shares was higher during a portion
of some of the periods shown, so that actual investment results would have been
lower. An explanation of the different performance calculations is in the Fund's
prospectus.
2 Oppenheimer Fund
<PAGE>
[PHOTO-BRIDGET A. MACASKILL]
Bridget A. Macaskill
President
Oppenheimer Fund
Dear Shareholder,
Against all odds, the stock market showed remarkable strength during the first
five months of 1996. However, in the few months that followed, the market
experienced significant volatility that resulted in a decline in the Dow of
about 7 percent.
Many experts said the stock market, having advanced to record heights in
1995 and void of any real market correction since 1990, was due for a downturn.
This was, after all, the longest bull market of the post-World War II era.
Thanks to the 10% rise in blue chip stocks during the first half of 1996 and the
early success of small stocks, the decline that occurred recently was somewhat
cushioned. While it's impossible to tell what will happen next, we are
optimistic that this turn was a correction within a bull market rather than the
onset of a bear market.
What made the market perform so well during the first part of the year? It
was another surprise: corporate profits. Between 1992 and 1995, corporate
profits of U.S. companies advanced at a double-digit rate. Investors widely
expected this year's profit tallies to be flat compared to 1995. After all, the
economy had been sluggish--growing at an annual rate of just 2.3% in the first
quarter of 1996. But corporate America continued to perform.
The reason corporate profits were so strong is that many U.S. companies
continued to successfully reduce costs. Often when a company achieves a small
increase in sales, the benefit goes straight to the bottom line. Indeed, the
U.S. Commerce Department reports indicated that corporate profits rose 15% for
the four quarters ended March 1996, while the economy grew only marginally.
Still, profits are not what they were in the early 1990s. That's why
investors are seeking out companies that can grow earnings regardless of the
fortunes of the economy. Which is just what many small companies in such fields
as technology, healthcare and specialty retailing have been doing, growing
earnings at double-digit--and even triple-digit rates. So it's not surprising
that the stocks of many of these small fast-growing companies have been such
strong performers.
The early strength of the stock market is all the more remarkable when you
consider that during the same period, interest rates moved up sharply. The yield
on the benchmark 30-year U.S. Treasury bond rose from about 6% in January to
over 7% today. Interest rates have been rising partly because investors are
concerned that the economy is growing fast enough to generate higher inflation.
However, we are watching this very closely, and would become very cautious
regarding the stock market's performance if inflation were to flare up.
As always, remember stock investments are generally meant for long-term
growth objectives, and often involve short-term volatility. So, it's critical
for investors to keep their focus on long-term goals and to put near-term
setbacks in proper prospective.
Your portfolio managers discuss the outlook for your Fund in light of these
broad issues on the following pages. Thank you for your confidence in
OppenheimerFunds. We look forward to helping you reach your investment goals in
the future.
/s/ Bridget A. Macaskill
Bridget A. Macaskill
July 22, 1996
3 Oppenheimer Fund
<PAGE>
[PHOTO-RICHARD RUBINSTEIN and ROBERT DOLL]
[PHOTO-PAUL LAROCCO]
[PHOTO-ROBERT DOLL]
Q + A
Q How did the Fund perform?
An interview with your Fund's managers.
How did the Fund perform over the past year?
The Fund delivered solid results for the period, finishing ahead of many of the
funds in our peer group.(1) While we benefited from an investment strategy
designed to work well under a variety of conditions, our success this period was
due in large part to the continued strength in growth-oriented domestic stocks.
What are the primary reasons for the Fund's positive performance?
A combination of factors contributed to our performance this period. First, our
domestic stock holdings, which included large positions in technology and
healthcare stocks, performed well for us, even as U.S. corporate earnings
momentum in general began to slow.
Second, our approach--to diversify our investments across five different
investment styles--has also helped performance. By using this approach, we
generally won't capture quite as much of the strength of a prolonged market
rally as a more stylistically focused fund might. However, when stocks become
more volatile, as they have over the past six months, our defensive approach
positions us to outperform.(2)
Did any investments negatively impact the Fund?
In general, our foreign stock holdings, while providing positive results,
failed to meet our expectations. Of course, investing abroad involves
substantial costs and risks--such as fluctuations in foreign currency. Over the
near term, however, our philosophy for including foreign securities in the
portfolio to help limit overall portfolio risk remains intact. And over the long
term, we are optimistic about their potential to outperform domestic stocks.
1. Source: Lipper Analytical Services, 6/30/96. Does not take sales charges into
consideration.
2. The Fund's portfolio is subject to change.
4 Oppenheimer Fund
<PAGE>
[PHOTO-RICHARD RUBINSTEIN]
[PHOTO-BRUCE BARTLETT]
Facing page
Top left: Richard Rubinstein,
Portfolio Manager with Robert
Doll, Executive VP, Director of
Equity Investments
Top right: Paul LaRocco, Member
of Equity Investments Team
Bottom: Robert Doll
This page
Top: Richard Rubinstein
Bottom: Bruce Bartlett, Member
of Equity Investments Team
A We
finished
ahead of
many
of the funds
in our peer
group.
What areas are you currently targeting?
Over the past few months, the combination of slowing U.S. corporate earnings
momentum, high valuations and an increase in interest rates has led us to
allocate the Fund's assets more conservatively. We've decreased the total number
of securities in the portfolio, while at the same time we've increased, on a
percentage basis, holdings we believe are best positioned for the future.
Over the period, we continued to focus on growth stocks, issued by
companies with strong competitive positions and consistent earnings. We also
recently added to our position in energy stocks, which have been selling at low
prices relative to cash flows, because we believe they offer reward potential if
energy prices increase.
Because part of our overall strategy involves a contrarian
approach--looking for opportunities in out-of-favor industries and companies on
the rebound--we bought retail stocks. Though many consumer retail companies
have suffered from consumer malaise, a lot have attractive store economics. As a
result, we think their prospects look good.
On the international side, we increased our positions in companies having
comparative advantages over U.S. competitors or that sell at valuation
discounts. In either case, the foreign company may be better positioned for
long-term profits by offering a comparative advantage. We identified companies
offering such advantages in Argentina, Turkey, and the Far East, as well as in
several more-established European markets.
What is your outlook for the Fund?
Despite the increased volatility of the stock market in the first half of 1996,
our long-term outlook is positive. Whether stocks continue to climb at an
accelerated pace or experience more normal growth, we believe the Fund, through
its broad diversification, is well-positioned to respond with competitive
returns and lower-than-average risk. [solid box]
5 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Investments June 30, 1996
Face Market Value
Amount See Note 1
<S> <C> <C>
===================================================================================================================================
Foreign Government Obligations--1.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Argentina (Republic of) Past Due Interest Bonds, Series L, 6.312%, 3/31/05
(Cost $2,264,894)(1) $ 3,960,000 $ 3,101,155
===================================================================================================================================
Convertible Corporate Bonds and Notes--0.6%
- -----------------------------------------------------------------------------------------------------------------------------------
MEDIQ, Inc., 7.50% Exchangeable Sub. Debs., 7/15/03 (Cost $1,748,461) 1,850,000 1,572,500
Shares
===================================================================================================================================
Common Stocks--86.5%
- -----------------------------------------------------------------------------------------------------------------------------------
Basic Materials--6.3%
- -----------------------------------------------------------------------------------------------------------------------------------
Chemicals--3.2%
Agrium, Inc. 30,000 393,281
---------------------------------------------------------------------------------------------------------------
ARCO Chemical Co. 28,900 1,502,800
---------------------------------------------------------------------------------------------------------------
Bayer AG, Sponsored ADR 170,000 6,003,058
---------------------------------------------------------------------------------------------------------------
Georgia Gulf Corp. 22,100 646,425
---------------------------------------------------------------------------------------------------------------
IMC Global, Inc. 12,400 466,550
------------
9,012,114
- -----------------------------------------------------------------------------------------------------------------------------------
Gold--0.5%
Santa Fe Pacific Gold Corp. 92,800 1,310,800
- -----------------------------------------------------------------------------------------------------------------------------------
Metals--1.3%
Brush Wellman, Inc. 151,400 2,876,600
---------------------------------------------------------------------------------------------------------------
J&L Specialty Steel, Inc. 54,500 810,687
------------
3,687,287
- -----------------------------------------------------------------------------------------------------------------------------------
Paper--1.3%
Aracruz Celulose SA, Sponsored ADR 165,000 1,567,500
---------------------------------------------------------------------------------------------------------------
MacMillan Bloedel Ltd. 90,323 1,197,146
---------------------------------------------------------------------------------------------------------------
MacMillan Bloedel Ltd. 4,900 64,925
---------------------------------------------------------------------------------------------------------------
Stone Container Corp. 64,800 891,000
------------
3,720,571
===================================================================================================================================
Consumer Cyclicals--12.4%
- -----------------------------------------------------------------------------------------------------------------------------------
Autos & Housing--1.3%
Chromcraft Revington, Inc.(2) 18,500 432,437
---------------------------------------------------------------------------------------------------------------
Fiat SpA 350,000 1,172,412
---------------------------------------------------------------------------------------------------------------
General Motors Corp.(3) 26,000 1,361,750
---------------------------------------------------------------------------------------------------------------
IRSA Inversiones y Representaciones, SA 214,506 730,355
------------
3,696,954
- -----------------------------------------------------------------------------------------------------------------------------------
Leisure & Entertainment--5.6%
AMR Corp.(2) 19,300 1,756,300
---------------------------------------------------------------------------------------------------------------
Carnival Corp., Cl. A 30,800 889,350
---------------------------------------------------------------------------------------------------------------
Circus Circus Enterprises, Inc.(2)(3) 31,800 1,303,800
---------------------------------------------------------------------------------------------------------------
Cracker Barrel Old Country Store, Inc. 90,800 2,201,900
---------------------------------------------------------------------------------------------------------------
Eastman Kodak Co.(3) 25,500 1,982,625
---------------------------------------------------------------------------------------------------------------
International Game Technology 57,000 961,875
---------------------------------------------------------------------------------------------------------------
King World Productions, Inc.(2)(3) 56,500 2,055,187
---------------------------------------------------------------------------------------------------------------
Mattel, Inc.(3) 76,093 2,178,162
---------------------------------------------------------------------------------------------------------------
Shimano, Inc. 82,000 1,465,334
---------------------------------------------------------------------------------------------------------------
U S West Media Group(2) 45,700 834,025
------------
15,628,558
6 Oppenheimer Fund
<PAGE>
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
Media--2.6%
Bowne & Co., Inc. 34,000 $ 701,250
---------------------------------------------------------------------------------------------------------------
Comcast Corp., Cl. A Special 130,000 2,405,000
---------------------------------------------------------------------------------------------------------------
Dow Jones & Co., Inc. 25,200 1,052,100
---------------------------------------------------------------------------------------------------------------
South China Morning Post Holdings Ltd. 2,400,000 1,643,303
---------------------------------------------------------------------------------------------------------------
Time Warner, Inc. 40,600 1,593,550
------------
7,395,203
- -----------------------------------------------------------------------------------------------------------------------------------
Retail: General--1.8%
Cone Mills Corp.(2) 243,000 2,733,750
---------------------------------------------------------------------------------------------------------------
Price/Costco, Inc.(2) 73,100 1,580,787
---------------------------------------------------------------------------------------------------------------
Wal-Mart Stores, Inc. 32,900 834,837
------------
5,149,374
- -----------------------------------------------------------------------------------------------------------------------------------
Retail: Specialty--1.1%
Gymboree Corp.(2)(3) 40,700 1,241,350
---------------------------------------------------------------------------------------------------------------
Toys 'R' Us, Inc.(2) 69,200 1,972,200
------------
3,213,550
===================================================================================================================================
Consumer Non-Cyclicals--17.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Beverages--1.2%
Buenos Aires Embotelladora SA, Sponsored ADR 35,000 463,750
---------------------------------------------------------------------------------------------------------------
Guinness PLC 182,000 1,323,466
---------------------------------------------------------------------------------------------------------------
Whitman Corp.(3) 63,100 1,522,287
------------
3,309,503
- -----------------------------------------------------------------------------------------------------------------------------------
Food--2.2%
Chiquita Brands International, Inc. 32,249 419,237
---------------------------------------------------------------------------------------------------------------
Groupe Danone 6,241 944,377
---------------------------------------------------------------------------------------------------------------
IBP, Inc.(3) 31,500 870,187
---------------------------------------------------------------------------------------------------------------
Nestle SA, Sponsored ADR 40,000 2,283,400
---------------------------------------------------------------------------------------------------------------
Sara Lee Corp.(3) 52,700 1,706,163
------------
6,223,364
- -----------------------------------------------------------------------------------------------------------------------------------
Healthcare/Drugs--7.3%
Abbott Laboratories 24,000 1,044,000
---------------------------------------------------------------------------------------------------------------
American Home Products Corp. 24,000 1,443,000
---------------------------------------------------------------------------------------------------------------
Astra AB Free, Series A 37,250 1,644,834
---------------------------------------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 48,000 4,320,000
---------------------------------------------------------------------------------------------------------------
Ciba-Geigy AG 2,825 3,441,981
---------------------------------------------------------------------------------------------------------------
Foundation Health Corp.(2) 23,000 825,125
---------------------------------------------------------------------------------------------------------------
Genzyme Corp.(2)(3) 31,500 1,582,875
---------------------------------------------------------------------------------------------------------------
Johnson & Johnson 38,600 1,910,700
---------------------------------------------------------------------------------------------------------------
Mylan Laboratories, Inc. 50,000 862,500
---------------------------------------------------------------------------------------------------------------
NBTY, Inc.(2) 204,400 2,056,775
---------------------------------------------------------------------------------------------------------------
SmithKline Beecham PLC, ADR 22,500 1,223,438
------------
20,355,228
- -----------------------------------------------------------------------------------------------------------------------------------
Healthcare/Supplies &
Services--3.2%
Biomet, Inc.(2) 45,000 646,875
---------------------------------------------------------------------------------------------------------------
Cardinal Health, Inc.(3) 4,472 322,543
---------------------------------------------------------------------------------------------------------------
Manor Care, Inc.(3) 30,770 1,211,569
---------------------------------------------------------------------------------------------------------------
Medtronic, Inc. 20,000 1,120,000
7 Oppenheimer Fund
<PAGE>
Statement of Investments (Continued)
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
Healthcare/Supplies &
Services (continued)
Nellcor Puritan Bennett, Inc.(2) 10,800 $ 523,800
---------------------------------------------------------------------------------------------------------------
Sofamor Danek Group, Inc.(2)(3) 22,000 610,500
---------------------------------------------------------------------------------------------------------------
U.S. Healthcare, Inc.(3) 63,500 3,492,500
---------------------------------------------------------------------------------------------------------------
WellPoint Health Networks, Inc.(2)(3) 34,417 1,075,531
------------
9,003,318
- -----------------------------------------------------------------------------------------------------------------------------------
Household Goods--1.2%
Kimberly-Clark Corp. 13,100 1,011,975
---------------------------------------------------------------------------------------------------------------
Procter & Gamble Co.(3) 14,000 1,268,750
---------------------------------------------------------------------------------------------------------------
Wella AG 1,750 1,003,686
------------
3,284,411
- -----------------------------------------------------------------------------------------------------------------------------------
Tobacco--2.0%
Philip Morris Cos., Inc. 54,300 5,647,200
===================================================================================================================================
Energy--4.9%
- -----------------------------------------------------------------------------------------------------------------------------------
Energy Services &
Producers--1.2%
Kerr-McGee Corp.(3) 13,000 791,375
---------------------------------------------------------------------------------------------------------------
Landmark Graphics Corp.(2) 66,600 1,282,050
---------------------------------------------------------------------------------------------------------------
Western Atlas, Inc.(2) 20,000 1,165,000
------------
3,238,425
- -----------------------------------------------------------------------------------------------------------------------------------
Oil-Integrated--3.7%
Atlantic Richfield Co. 13,900 1,647,150
---------------------------------------------------------------------------------------------------------------
Enterprise Oil PLC 118,000 843,403
---------------------------------------------------------------------------------------------------------------
Royal Dutch Petroleum Co. 9,500 1,460,625
---------------------------------------------------------------------------------------------------------------
Saga Petroleum AS, Cl. B 82,000 1,110,781
---------------------------------------------------------------------------------------------------------------
Total SA, Sponsored ADR(3) 52,680 1,955,745
---------------------------------------------------------------------------------------------------------------
Unocal Corp. 88,000 2,970,000
---------------------------------------------------------------------------------------------------------------
Yukong Ltd., GDR(4) 39,500 258,081
---------------------------------------------------------------------------------------------------------------
Yukong Ltd., GDR 1,438 12,237
---------------------------------------------------------------------------------------------------------------
Yukong Ltd., GDR 3,294 28,032
------------
10,286,054
- -----------------------------------------------------------------------------------------------------------------------------------
Financial--10.4%
- -----------------------------------------------------------------------------------------------------------------------------------
Banks--6.5%
Akbank T.A.S. 2,661,250 320,662
---------------------------------------------------------------------------------------------------------------
Banco Frances del Rio de la Plata SA 109,900 1,058,737
---------------------------------------------------------------------------------------------------------------
Chase Manhattan Corp. (New)(3) 94,600 6,681,125
---------------------------------------------------------------------------------------------------------------
Citicorp(3) 16,000 1,322,000
---------------------------------------------------------------------------------------------------------------
Deutsche Bank, Sponsored ADR 60,000 2,838,108
---------------------------------------------------------------------------------------------------------------
NationsBank Corp. 72,200 5,965,525
------------
18,186,157
- -----------------------------------------------------------------------------------------------------------------------------------
Diversified Financial--1.4%
American Express Co. 44,100 1,967,963
---------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. 9,700 829,350
---------------------------------------------------------------------------------------------------------------
H & R Block, Inc.(3) 30,600 998,325
------------
3,795,638
8 Oppenheimer Fund
<PAGE>
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
Insurance--2.5%
ACE Ltd. 21,600 $ 1,015,200
---------------------------------------------------------------------------------------------------------------
Aetna Life & Casualty Co. 5,600 400,400
---------------------------------------------------------------------------------------------------------------
American International Group, Inc. 13,700 1,351,163
---------------------------------------------------------------------------------------------------------------
American Re Corp.(3) 48,800 2,189,900
---------------------------------------------------------------------------------------------------------------
Skandia Forsakrings AB 40,000 1,057,950
---------------------------------------------------------------------------------------------------------------
UNUM Corp. 13,500 840,375
------------
6,854,988
===================================================================================================================================
Industrial--10.9%
- -----------------------------------------------------------------------------------------------------------------------------------
Electrical Equipment--1.2%
General Electric Co.(3) 39,600 3,425,400
- -----------------------------------------------------------------------------------------------------------------------------------
Industrial Materials--2.0%
Insituform Technologies, Cl. A(2) 72,000 558,000
---------------------------------------------------------------------------------------------------------------
Interpool, Inc. 42,500 775,625
---------------------------------------------------------------------------------------------------------------
Owens Corning 77,000 3,311,000
---------------------------------------------------------------------------------------------------------------
Wolverine Tube, Inc.(2) 25,700 899,500
------------
5,544,125
===================================================================================================================================
Industrial Services--0.4%
Ecolab, Inc.(3) 35,400 1,168,200
- -----------------------------------------------------------------------------------------------------------------------------------
Manufacturing--3.7%
Citic Pacific Ltd. 214,000 865,344
---------------------------------------------------------------------------------------------------------------
Harnischfeger Industries, Inc.(3) 21,800 724,850
---------------------------------------------------------------------------------------------------------------
Hutchison Whampoa Ltd. 132,000 830,488
---------------------------------------------------------------------------------------------------------------
Mannesmann AG 6,000 2,065,514
---------------------------------------------------------------------------------------------------------------
Pacific Dunlop Ltd. 476,000 1,071,463
---------------------------------------------------------------------------------------------------------------
Tenneco, Inc.(3) 75,800 3,875,275
---------------------------------------------------------------------------------------------------------------
Westinghouse Air Brake Co. 60,200 790,125
------------
10,223,059
- -----------------------------------------------------------------------------------------------------------------------------------
Transportation--3.6%
Airborne Freight Corp.(3) 44,000 1,144,000
---------------------------------------------------------------------------------------------------------------
Burlington Northern Santa Fe Corp.(3) 57,400 4,642,225
---------------------------------------------------------------------------------------------------------------
Canadian National Railway Co. 38,000 699,828
---------------------------------------------------------------------------------------------------------------
Consolidated Freightways, Inc. 14,200 299,975
---------------------------------------------------------------------------------------------------------------
Stolt-Nielsen SA 116,000 2,102,500
---------------------------------------------------------------------------------------------------------------
Stolt-Nielsen SA, ADR 58,000 1,080,250
------------
9,968,778
===================================================================================================================================
Technology--21.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Aerospace/Defense--0.6%
Rockwell International Corp.(3) 27,300 1,562,925
- -----------------------------------------------------------------------------------------------------------------------------------
Computer Hardware--3.9%
Digital Equipment Corp.(2) 21,000 945,000
---------------------------------------------------------------------------------------------------------------
EMC Corp.(2) 36,800 685,400
---------------------------------------------------------------------------------------------------------------
International Business Machines Corp.(3) 17,400 1,722,600
---------------------------------------------------------------------------------------------------------------
Moore Corp. Ltd. 37,400 705,925
---------------------------------------------------------------------------------------------------------------
Storage Technology Corp. (New)(2)(3) 11,000 420,750
---------------------------------------------------------------------------------------------------------------
Sun Microsystems, Inc.(2)(3) 7,000 412,125
---------------------------------------------------------------------------------------------------------------
Xerox Corp.(3) 111,000 5,938,500
------------
10,830,300
9 Oppenheimer Fund
<PAGE>
Statement of Investments (Continued)
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
Computer Software--6.8%
American Software, Inc. 50,000 $ 231,250
---------------------------------------------------------------------------------------------------------------
Computer Associates International, Inc.(3) 44,100 3,142,125
---------------------------------------------------------------------------------------------------------------
Davidson & Associates, Inc.(2) 34,000 1,020,000
---------------------------------------------------------------------------------------------------------------
Electronic Arts, Inc.(2) 48,600 1,300,050
---------------------------------------------------------------------------------------------------------------
Informix Corp.(2)(3) 52,800 1,188,000
---------------------------------------------------------------------------------------------------------------
Microsoft Corp.(2) 9,800 1,177,225
---------------------------------------------------------------------------------------------------------------
Nintendo Co. Ltd. 45,000 3,347,876
---------------------------------------------------------------------------------------------------------------
Novell, Inc.(2) 238,400 3,307,800
---------------------------------------------------------------------------------------------------------------
Structural Dynamics Research Corp.(2) 67,100 1,476,200
---------------------------------------------------------------------------------------------------------------
Sybase, Inc.(2) 46,600 1,100,925
---------------------------------------------------------------------------------------------------------------
Symantec Corp.(2) 137,340 1,716,750
------------
19,008,201
- -----------------------------------------------------------------------------------------------------------------------------------
Electronics--7.2%
Duracell International, Inc. 18,500 797,813
---------------------------------------------------------------------------------------------------------------
General Motors Corp., Cl. H 20,800 1,250,600
---------------------------------------------------------------------------------------------------------------
Hewlett-Packard Co. 34,000 3,387,250
---------------------------------------------------------------------------------------------------------------
Intel Corp. 119,800 8,797,813
---------------------------------------------------------------------------------------------------------------
Kyocera Corp. 17,000 1,201,205
---------------------------------------------------------------------------------------------------------------
LSI Logic Corp.(2)(3) 32,000 832,000
---------------------------------------------------------------------------------------------------------------
Nokia Corp., Preference 22,000 814,000
---------------------------------------------------------------------------------------------------------------
Proxima Corp.(2) 70,000 848,750
---------------------------------------------------------------------------------------------------------------
Samsung Electronics (First New)(2) 79 6,282
---------------------------------------------------------------------------------------------------------------
Samsung Electronics Co. 265 22,247
---------------------------------------------------------------------------------------------------------------
Teradyne, Inc.(2) 55,000 948,750
---------------------------------------------------------------------------------------------------------------
VLSI Technology, Inc.(2) 76,500 1,061,438
------------
19,968,148
- -----------------------------------------------------------------------------------------------------------------------------------
Telecommunications-
Technology--2.6%
Airtouch Communications, Inc.(2)(3) 45,500 1,285,375
---------------------------------------------------------------------------------------------------------------
Bay Networks, Inc.(2)(3) 26,870 691,903
---------------------------------------------------------------------------------------------------------------
ECI Telecommunications Ltd.(3) 57,500 1,336,875
---------------------------------------------------------------------------------------------------------------
Kinnevik Investments AB Free, Series B 31,500 954,190
---------------------------------------------------------------------------------------------------------------
MCI Communications Corp. 100,000 2,562,500
---------------------------------------------------------------------------------------------------------------
NetCom Systems AB, B Shares(2) 31,500 356,041
------------
7,186,884
===================================================================================================================================
Utilities--3.4%
- -----------------------------------------------------------------------------------------------------------------------------------
Electric Utilities--1.3%
Korea Electric Power Corp. 20,000 814,622
---------------------------------------------------------------------------------------------------------------
Public Service Enterprise Group, Inc. 30,000 821,250
---------------------------------------------------------------------------------------------------------------
Verbund Oest Electriz 25,200 1,923,113
------------
3,558,985
- -----------------------------------------------------------------------------------------------------------------------------------
Gas Utilities--0.7%
Hong Kong & China Gas 591,648 943,976
---------------------------------------------------------------------------------------------------------------
Southwestern Energy Co. 72,500 1,024,063
------------
1,968,039
10 Oppenheimer Fund
<PAGE>
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
Telephone Utilities--1.4%
BCE, Inc. 34,000 $ 1,343,000
---------------------------------------------------------------------------------------------------------------
Portugal Telecom SA(2) 15,900 415,321
---------------------------------------------------------------------------------------------------------------
U S West Communications Group 65,500 2,087,813
------------
3,846,134
------------
Total Common Stocks (Cost $164,928,947) 241,257,875
- -----------------------------------------------------------------------------------------------------------------------------------
Preferred Stocks--1.5%
---------------------------------------------------------------------------------------------------------------
Alumax, Inc., $4.00 Cv., Series A 6,333 825,665
---------------------------------------------------------------------------------------------------------------
Cyprus Amax Minerals Co., $4.00 Cv., Series A 20,666 1,131,463
---------------------------------------------------------------------------------------------------------------
Delta Air Lines, Inc., $3.50 Cv. Depositary Shares, Series C 36,300 2,286,900
------------
Total Preferred Stocks (Cost $3,245,783) 4,244,028
Units
===================================================================================================================================
Rights, Warrants and Certificates--0.0%
- -----------------------------------------------------------------------------------------------------------------------------------
Hong Kong & China Gas Wts., Exp. 9/97 (Cost $19,691) 74,304 19,439
Face
Amount
===================================================================================================================================
Repurchase Agreement--10.8%
---------------------------------------------------------------------------------------------------------------
Repurchase agreement with Canadian Imperial Bank of Commerce,
5.45%, dated 6/28/96, to be repurchased at $30,213,716 on 7/1/96,
collateralized by U.S. Treasury Bonds, 9.125%--11.25%, 2/15/15--5/11/18,
with a value of $10,675,333, and U.S. Treasury Nts., 5.25%--8.50%,
1/11/97--11/15/04, with a value of $20,174,956 (Cost $30,200,000) $ 30,200,000 30,200,000
---------------------------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $202,407,776) 100.5% 280,394,997
---------------------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (0.5) (1,460,799)
------------ ------------
Net Assets 100.0% $278,934,198
============ ============
</TABLE>
1. Represents the current interest rate for a variable rate
security.
2. Non-income producing security.
11 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Investments (Continued)
- -----------------------------------------------------------------------------------------------------------------------------------
3. A sufficient amount of liquid assets has been designated
to cover outstanding written call options, as follows:
Shares Expiration Exercise Premium Market Value
Subject To Call Date Price Received See Note 1
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
Airborne Freight Corp. 15,000 8/96 $ 30 $ 26,125 $ 3,746
- -----------------------------------------------------------------------------------------------------------------------------------
Airtouch Communications, Inc. 9,000 7/96 34 12,771 563
- -----------------------------------------------------------------------------------------------------------------------------------
American Re Corp. 10,800 7/96 45 19,925 14,175
- -----------------------------------------------------------------------------------------------------------------------------------
Bay Networks, Inc. 21,000 9/96 35 91,242 14,438
- -----------------------------------------------------------------------------------------------------------------------------------
Burlington Northern Santa Fe Corp. 11,200 7/96 85 43,063 7,000
- -----------------------------------------------------------------------------------------------------------------------------------
Cardinal Health, Inc. 11,000 7/96 18 17,544 129,250
- -----------------------------------------------------------------------------------------------------------------------------------
Chase Manhattan Corp. (New) 18,500 9/96 70 73,443 97,125
- -----------------------------------------------------------------------------------------------------------------------------------
Circus Circus Enterprises, Inc. 6,200 9/96 33 19,188 58,900
- -----------------------------------------------------------------------------------------------------------------------------------
Citicorp 3,200 7/96 75 10,704 24,400
- -----------------------------------------------------------------------------------------------------------------------------------
Computer Associates International, Inc. 8,800 7/96 50 35,551 8,800
- -----------------------------------------------------------------------------------------------------------------------------------
Eastman Kodak Co. 5,000 7/96 75 20,474 18,750
- -----------------------------------------------------------------------------------------------------------------------------------
ECI Telecommunications Ltd. 15,200 8/96 30 26,143 3,800
- -----------------------------------------------------------------------------------------------------------------------------------
Ecolab, Inc. 5,000 7/96 35 5,850 1,563
- -----------------------------------------------------------------------------------------------------------------------------------
General Electric Co. 8,000 9/96 80 24,759 64,000
- -----------------------------------------------------------------------------------------------------------------------------------
General Motors Corp. 4,000 9/96 65 15,379 7,500
- -----------------------------------------------------------------------------------------------------------------------------------
Genzyme Corp. 5,400 7/96 80 27,679 338
- -----------------------------------------------------------------------------------------------------------------------------------
Gymboree Corp. 9,000 7/96 20 13,230 97,875
- -----------------------------------------------------------------------------------------------------------------------------------
H & R Block, Inc. 12,000 7/96 40 24,635 750
- -----------------------------------------------------------------------------------------------------------------------------------
Harnischfeger Industries, Inc. 14,600 8/96 35 67,335 12,775
- -----------------------------------------------------------------------------------------------------------------------------------
Harnischfeger Industries, Inc. 7,200 8/96 40 7,884 1,800
- -----------------------------------------------------------------------------------------------------------------------------------
IBP, Inc. 31,500 11/96 25 69,928 110,250
- -----------------------------------------------------------------------------------------------------------------------------------
Informix Corp. 29,000 8/96 35 129,626 3,625
- -----------------------------------------------------------------------------------------------------------------------------------
International Business Machines Corp. 2,800 7/96 120 13,216 350
- -----------------------------------------------------------------------------------------------------------------------------------
Kerr-McGee Corp. 2,600 7/96 70 2,684 650
- -----------------------------------------------------------------------------------------------------------------------------------
King World Productions, Inc. 16,000 8/96 45 27,519 4,000
- -----------------------------------------------------------------------------------------------------------------------------------
LSI Logic Corp. 8,000 7/96 35 25,759 1,000
- -----------------------------------------------------------------------------------------------------------------------------------
LSI Logic Corp. 8,000 7/96 45 20,259 500
- -----------------------------------------------------------------------------------------------------------------------------------
Manor Care, Inc. 6,000 7/96 45 5,820 750
- -----------------------------------------------------------------------------------------------------------------------------------
Mattel, Inc. 15,000 7/96 28 20,414 23,438
- -----------------------------------------------------------------------------------------------------------------------------------
Procter & Gamble Co. 2,800 7/96 95 5,341 1,050
- -----------------------------------------------------------------------------------------------------------------------------------
Rockwell International Corp. 5,400 7/96 65 14,013 675
- -----------------------------------------------------------------------------------------------------------------------------------
Sara Lee Corp. 12,200 7/96 35 16,408 763
- -----------------------------------------------------------------------------------------------------------------------------------
Sofamor Danek Group, Inc. 12,000 9/96 30 55,138 33,750
- -----------------------------------------------------------------------------------------------------------------------------------
Storage Technology Corp. (New) 11,000 9/96 23 50,545 177,375
- -----------------------------------------------------------------------------------------------------------------------------------
Sun Microsystems, Inc. 7,000 7/96 48 56,331 84,000
- -----------------------------------------------------------------------------------------------------------------------------------
Tenneco, Inc. 15,000 8/96 60 22,049 2,813
- -----------------------------------------------------------------------------------------------------------------------------------
Total SA, Sponsored ADR 11,000 8/96 40 10,670 6,188
- -----------------------------------------------------------------------------------------------------------------------------------
U.S. Healthcare, Inc. 15,000 7/96 55 20,174 9,375
- -----------------------------------------------------------------------------------------------------------------------------------
Wellpoint Health Networks, Inc. 10,200 7/96 30 10,383 2,550
- -----------------------------------------------------------------------------------------------------------------------------------
Whitman Corp. 15,000 9/96 25 14,550 11,250
- -----------------------------------------------------------------------------------------------------------------------------------
Xerox Corp. 22,200 7/96 50 60,827 88,800
---------- ------------
$1,234,581 $ 1,130,700
========== ============
</TABLE>
4. Represents a security sold under Rule 144A, which is
exempt from registration under the Securities Act of 1933,
as amended. This security has been determined to be liquid
under guidelines established by the Board of Trustees. These
securities amount to $258,081 or 0.09% of the Fund's net
assets, at June 30, 1996.
See accompanying Notes to Financial Statements.
12 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Assets and Liabilities June 30, 1996
<S> <C>
===================================================================================================================================
Assets Investments, at value (including repurchase agreement of $30,200,000)
(cost $202,407,776)--see accompanying statement $280,394,997
---------------------------------------------------------------------------------------------------------------
Cash 101,788
---------------------------------------------------------------------------------------------------------------
Receivables:
Interest and dividends 595,026
Shares of beneficial interest sold 108,283
---------------------------------------------------------------------------------------------------------------
Other 66,034
------------
Total assets 281,266,128
===================================================================================================================================
Liabilities Options written, at value (premiums received $1,234,581)--
see accompanying statement--Note 5 1,130,700
---------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed 426,981
Investments purchased 350,990
Trustees' fees 118,521
Distribution and service plan fees 91,662
Transfer and shareholder servicing agent fees 66,305
Shareholder reports 60,356
Other 86,415
------------
Total liabilities 2,331,930
===================================================================================================================================
Net Assets $278,934,198
============
===================================================================================================================================
Composition of Paid-in capital $178,389,656
Net Assets ---------------------------------------------------------------------------------------------------------------
Undistributed net investment income 4,179,246
---------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign currency transactions 18,274,717
---------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and
liabilities denominated in foreign currencies 78,090,579
------------
Net assets $278,934,198
============
===================================================================================================================================
Net Asset Value Class A Shares:
Per Share Net asset value and redemption price per share (based on net assets of
$273,193,978 and 22,495,412 shares of beneficial interest outstanding) $ 12.14
Maximum offering price per share (net asset value plus sales charge of
5.75% of offering price) $ 12.88
---------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $1,654,505 and 137,088 shares of beneficial interest outstanding) $ 12.07
---------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based
on net assets of $4,085,715 and 342,672 shares of beneficial interest outstanding) $ 11.92
</TABLE>
See accompanying Notes to Financial Statements.
13 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Operations For the Year Ended June 30, 1996
<S> <C>
===================================================================================================================================
Investment Income Dividends (net of foreign withholding taxes of $112,278) $ 5,887,471
---------------------------------------------------------------------------------------------------------------
Interest 1,929,027
------------
Total income 7,816,498
===================================================================================================================================
Expenses Management fees--Note 4 2,036,339
---------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 616,198
---------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 350,307
Class B 4,128
Class C 34,894
---------------------------------------------------------------------------------------------------------------
Shareholder reports 108,816
---------------------------------------------------------------------------------------------------------------
Trustees' fees and expenses--Note 1 91,485
---------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 85,190
---------------------------------------------------------------------------------------------------------------
Legal and auditing fees 71,929
---------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 334
Class B 561
Class C 496
---------------------------------------------------------------------------------------------------------------
Other 98,175
------------
Total expenses 3,498,852
===================================================================================================================================
Net Investment Income 4,317,646
===================================================================================================================================
Realized and Net realized gain on:
Unrealized Investments (including premiums on options exercised) 21,639,931
Gain (Loss) Foreign currency transactions 309,497
Closing and expiration of options written--Note 5 845,454
------------
Net realized gain 22,794,882
---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments 18,834,911
Translation of assets and liabilities denominated in foreign currencies (1,955,886)
------------
Net change 16,879,025
------------
Net realized and unrealized gain 39,673,907
===================================================================================================================================
Net Increase in Net Assets Resulting From Operations $ 43,991,553
============
See accompanying Notes to Financial Statements
</TABLE>
14 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Statements of Changes in Net Assets
Year Ended June 30,
1996 1995
<S> <C> <C>
===================================================================================================================================
Operations Net investment income $ 4,317,646 $ 2,806,853
---------------------------------------------------------------------------------------------------------------
Net realized gain 22,794,882 19,743,628
---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 16,879,025 23,440,270
------------- -------------
Net increase in net assets resulting from operations 43,991,553 45,990,751
===================================================================================================================================
Dividends and Dividends from net investment income:
Distributions to Class A (2,763,277) (498,859)
Shareholders Class B (1,333) --
Class C (19,415) --
---------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (20,559,886) (24,601,920)
Class B (10,043) --
Class C (287,511) (100,620)
===================================================================================================================================
Beneficial Net increase (decrease) in net assets resulting from
Interest beneficial interest transactions--Note 2:
Transactions Class A (17,324,834) 12,428,700
Class B 1,639,742 --
Class C 1,733,727 1,742,306
===================================================================================================================================
Net Assets Total increase 6,398,723 34,960,358
---------------------------------------------------------------------------------------------------------------
Beginning of period 272,535,475 237,575,117
------------- -------------
End of period (including undistributed net investment income
of $4,179,246 and $3,477,408, respectively) $ 278,934,198 $ 272,535,475
============= =============
</TABLE>
See accompanying Notes to Financial Statements
15 Oppenheimer Fund
<PAGE>
<TABLE>
<CAPTION>
Financial Highlights
Class A
----------------------------------------------------------------
Year Ended June 30,
1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C>
=====================================================================================================================
Per Share Operating Data:
Net asset value, beginning of period $ 11.34 $ 10.55 $ 10.41 $ 9.72 $ 9.31
- ---------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .20 .31 .07 .11 .16
Net realized and unrealized
gain (loss) 1.69 1.58 .55 1.15 .84
-------- -------- -------- -------- --------
Total income (loss) from investment
operations 1.89 1.89 .62 1.26 1.00
- ---------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.13) (.02) (.03) (.10) (.32)
Distributions from net realized gain (.96) (1.08) (.45) (.47) (.27)
-------- -------- -------- -------- --------
Total dividends and distributions
to shareholders (1.09) (1.10) (.48) (.57) (.59)
- ---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 12.14 $ 11.34 $ 10.55 $ 10.41 $ 9.72
======== ======== ======== ======== ========
=====================================================================================================================
Total Return, at Net Asset Value(3) 17.56% 19.60% 5.84% 13.33% 11.22%
=====================================================================================================================
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $273,194 $270,381 $237,281 $216,180 $209,495
- ---------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $270,211 $254,011 $229,976 $212,660 $221,369
- ---------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 1.59% 1.10% 0.69% 1.05% 1.71%
Expenses 1.26% 1.29% 1.16% 1.10% 1.09%
- ---------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 29.7% 34.1% 41.6% 35.6% 58.2%
Average brokerage commission rate(6) $ 0.0324 -- -- -- --
<CAPTION>
Class B Class C
------- ------------------------------------
Period
Ended
June 30, Year Ended June 30,
1996(2) 1996 1995 1994(1)
<S> <C> <C> <C> <C>
=================================================================================================
Per Share Operating Data:
Net asset value, beginning of period $ 11.85 $ 11.19 $ 10.49 $ 11.08
- -------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .14 .07 .03 .02
Net realized and unrealized
gain (loss) 1.17 1.69 1.75 (.14)
-------- -------- -------- --------
Total income (loss) from investment
operations 1.31 1.76 1.78 (.12)
- -------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.13) (.07) -- (.02)
Distributions from net realized gain (.96) (.96) (1.08) (.45)
-------- -------- -------- --------
Total dividends and distributions
to shareholders (1.09) (1.03) (1.08) (.47)
- -------------------------------------------------------------------------------------------------
Net asset value, end of period $ 12.07 $ 11.92 $ 11.19 $ 10.49
======== ======== ======== ========
=================================================================================================
Total Return, at Net Asset Value(3) 11.86% 16.51% 18.57% (1.24)%
=================================================================================================
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $ 1,655 $ 4,086 $ 2,154 $ 294
- -------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 649 $ 3,491 $ 1,100 $ 108
- -------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 0.74%(4) 0.75% 0.48% 0.05%(4)
Expenses 2.13%(4) 2.15% 2.20% 2.44%(4)
- -------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 29.7% 29.7% 34.1% 41.6%
Average brokerage commission rate(6) $ 0.0324 $ 0.0324 -- --
</TABLE>
1. For the period from December 1, 1993 (inception of offering) to June 30,
1994.
2. For the period from November 1, 1995 (inception of offering) to June 30,
1996.
3. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
4. Annualized.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended June 30, 1996 were $74,869,135 and $104,723,299, respectively.
6. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
16 Oppenheimer Fund
<PAGE>
Notes to Financial Statements
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Oppenheimer 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 objective is to seek capital appreciation through investment
in common stocks that offer growth potential. The Fund's investment advisor is
OppenheimerFunds, Inc. (the Manager). The Fund offers Class A, Class B and Class
C shares. Class A shares are sold with a front-end sales charge. Class B and
Class C shares may be subject to a contingent deferred sales charge. All 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. The following is a summary of
significant accounting policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
Investment Valuation. Portfolio securities are valued at the close of the New
York Stock Exchange 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 and
short-term "non-money market" debt securities are valued by a portfolio pricing
service approved by the Board of Trustees. Such securities which cannot be
valued by the approved portfolio pricing service are valued using
dealer-supplied valuations provided the Manager is satisfied that the firm
rendering the quotes is reliable and that the quotes reflect current market
value, or are valued under consistently applied procedures established by the
Board of Trustees to determine fair value in good faith. Short-term "money
market type" 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. Forward foreign currency exchange contracts
are valued based on the closing prices of the forward currency contract rates in
the London foreign exchange markets on a daily basis as provided by a reliable
bank or dealer. Options are valued based upon the last sale price on the
principal exchange on which the option is traded or, in the absence of any
transactions that day, the value is based upon the last sale price on the prior
trading date if it is within the spread between the closing bid and asked
prices. If the last sale price is outside the spread, the closing bid or asked
price closest to the last reported sale price is used.
- --------------------------------------------------------------------------------
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 effect of changes in foreign currency exchange rates is separately
identified from the fluctuations arising from changes in market values of
securities held and reported with all other foreign currency gains and losses in
the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, 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.
- --------------------------------------------------------------------------------
Federal Taxes. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
Trustees' Fees and Expenses. The Fund has adopted a nonfunded retirement plan
for the Fund's independent trustees. Benefits are based on years of service and
fees paid to each trustee during the years of service. During the year ended
June 30, 1996, a provision of $41,657 was made for the Fund's projected benefit
obligations and payments of $2,831 were made to retired trustees, resulting in
an accumulated liability of $102,810 at June 30, 1996.
17 Oppenheimer Fund
<PAGE>
Notes to Financial Statements (Continued)
- --------------------------------------------------------------------------------
1. Significant
Accounting
Policies
(continued)
Distributions to Shareholders. Dividends and distributions to shareholders are
reported on the ex-dividend date.
- --------------------------------------------------------------------------------
Classification of Distributions to Shareholders. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of the recognition of certain foreign currency gains (losses)
as ordinary income (loss) for tax purposes. The character of the distributions
made during the year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax purposes. Also, due
to timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gain (loss) was
recorded by the Fund.
During the year ended June 30, 1996, the Fund changed the classification of
distributions to shareholders to better disclose the differences between
financial statement amounts and distributions determined in accordance with
income tax regulations. Accordingly, during the year ended June 30, 1996,
amounts have been classified to reflect a decrease in paid in capital of
$770,135, a decrease in undistributed net investment income of $831,783, and an
increase in accumulated net realized gain on investments of $1,601,918.
- --------------------------------------------------------------------------------
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.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
- --------------------------------------------------------------------------------
2. Shares of
Beneficial
Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest. Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Year Ended June 30, 1996(1) Year Ended June 30, 1995
------------------------------ -------------------------------
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Class A:
Sold 2,083,446 $ 24,678,546 6,673,759 $ 71,435,301
Dividends and distributions reinvested 1,924,123 21,357,698 2,364,103 23,168,217
Redeemed (5,349,170) (63,361,078) (7,685,964) (82,174,818)
---------- ------------ --------- ------------
Net increase (decrease) (1,341,601) $(17,324,834) 1,351,898 $ 12,428,700
========== ============ ========= ============
- ------------------------------------------------------------------------------------------------------------------------------------
Class B:
Sold 215,151 $ 2,550,547 -- $ --
Dividends and distributions reinvested 1,026 11,365 -- --
Redeemed (79,090) (922,170) -- --
---------- ------------ --------- ------------
Net increase 137,088 $ 1,639,742 -- $ --
========== ============ ========= ============
- ------------------------------------------------------------------------------------------------------------------------------------
Class C:
Sold 238,989 $ 2,774,056 183,982 $ 1,948,887
Dividends and distributions reinvested 26,363 288,410 8,876 86,189
Redeemed (115,207) (1,328,739) (28,381) (292,770)
---------- ------------ --------- ------------
Net increase 150,145 $ 1,733,727 164,477 $ 1,742,306
========== ============ ========= ============
</TABLE>
1. For the year ended June 30, 1996 for Class A and Class C shares, and for
the period from November 1, 1995 (inception of offering) to June 30, 1996 for
Class B shares.
18 Oppenheimer Fund
<PAGE>
- --------------------------------------------------------------------------------
3. Unrealized Gains and
Losses on Investments and
Options Written
At June 30, 1996, net unrealized appreciation on investments and options written
of $78,091,102 was composed of gross appreciation of $84,234,203, and gross
depreciation of $6,143,101.
- --------------------------------------------------------------------------------
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 a fee of 0.75% on the first
$200 million of average annual net assets with a reduction of 0.03% on each $200
million thereafter to $800 million, and 0.60% on net assets in excess of $800
million. The Manager has agreed to reimburse the Fund if aggregate expenses
(with specified exceptions) exceed the most stringent applicable regulatory
limit on Fund expenses.
For the year ended June 30, 1996, commissions (sales charges paid by
investors) on sales of Class A shares totaled $581,891, of which $146,293 was
retained by OppenheimerFunds Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated broker/dealer. Sales
charges advanced to broker/dealers by OFDI on sales of the Fund's Class B and
Class C shares totaled $51,972 and $21,470, of which $1,625 was paid to an
affiliated broker/dealer for Class C shares. During the year ended June 30,
1996, OFDI received contingent deferred sales charges of $2,962 upon redemption
of Class C shares as reimbursement for sales commissions advanced by OFDI at the
time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the transfer
and shareholder servicing agent for the Fund, and for other registered
investment companies. OFS's total costs of providing such services are allocated
ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to reimburse OFDI
for a portion of its costs incurred in connection with the personal service and
maintenance of accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate that may not exceed 0.25% of the average annual net
assets of Class A shares of the Fund. OFDI uses the service fee to reimburse
brokers, dealers, banks and other financial institutions quarterly for providing
personal service and maintenance of accounts of their customers that hold Class
A shares. During the year ended June 30, 1996, OFDI paid $5,013 to an affiliated
broker/dealer as reimbursement for Class A personal service and maintenance
expenses.
The Fund has adopted a compensation type Distribution and Service Plan for
Class B shares to compensate OFDI for its services and costs in distributing
Class B shares and servicing accounts. Under the Plan, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class B shares that are
outstanding for 6 years or less. OFDI also receives a service fee of 0.25% per
year to compensate dealers for providing personal services for accounts that
hold Class B shares. Both fees are computed on the average annual net assets of
Class B shares, determined as of the close of each regular business day. If the
Plan is terminated by the Fund, the Board of Trustees may allow the Fund to
continue payments of the asset-based sales charge to OFDI for certain expenses
it incurred before the Plan was terminated. During the year ended June 30, 1996,
OFDI retained $4,128 as compensation for Class B sales commissions and service
fee advances, as well as financing costs. As of June 30, 1996, OFDI had incurred
unreimbursed expenses of $58,024 for Class B.
The Fund has adopted a reimbursement type Distribution and Service Plan for
Class C shares to reimburse OFDI for its services and costs in distributing
Class C shares and servicing accounts. Under the Plan, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class C shares. OFDI also
receives a service fee of 0.25% per year to reimburse dealers for providing
personal services for accounts that hold Class C shares. Both fees are computed
on the average annual net assets of Class C shares, determined as of the close
of each regular business day. If the Plan is terminated by the Fund, the Board
of Trustees may allow the Fund to continue payments of the asset-based sales
charge to OFDI for certain expenses it incurred before the Plan was terminated.
During the year ended June 30, 1996, OFDI retained $21,763 as reimbursement for
Class C sales commissions and service fee advances, as well as financing costs.
As of June 30, 1996, OFDI had incurred unreimbursed expenses of $67,156 for
Class C.
19 Oppenheimer Fund
<PAGE>
Notes to Financial Statements (Continued)
- --------------------------------------------------------------------------------
5. Option Activity
The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Shares subject to call, expiration
date, exercise price, premium received and market value are detailed in a
footnote to the Statement of Investments. Options written are reported as a
liability in the Statement of Assets and Liabilities. Gains and losses are
reported in the Statement of Operations.
The risk in writing a call option is that the Fund gives up the opportunity
for profit if the market price of the security increases and the option is
exercised. The risk in writing a put option is that the Fund may incur a loss if
the market price of the security decreases and the option is exercised. The risk
in buying an option is that the Fund pays a premium whether or not the option is
exercised. The Fund also has the additional risk of not being able to enter into
a closing transaction if a liquid secondary market does not exist.
Written option activity for the year ended June 30, 1996 was as follows:
Call Options
------------------------
Number of Amount of
Options Premiums
- --------------------------------------------------------------------------------
Options outstanding at June 30, 1995 5,992 $ 1,266,634
- --------------------------------------------------------------------------------
Options written 9,804 2,642,006
- --------------------------------------------------------------------------------
Options closed or expired (8,036) (1,868,399)
- --------------------------------------------------------------------------------
Options exercised (3,182) (805,660)
----- -----------
Options outstanding at June 30, 1996 4,578 $ 1,234,581
===== ===========
20 Oppenheimer Fund
<PAGE>
Independent Auditors' Report
- --------------------------------------------------------------------------------
The Board of Trustees and Shareholders of Oppenheimer Fund:
We have audited the accompanying statements of investments and assets and
liabilities of Oppenheimer Fund as of June 30, 1996, and the related statement
of operations for the year then ended, the statements of changes in net assets
for each of the years in the two-year period then ended and the financial
highlights for each of the years in the five-year period then ended. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with 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 includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1996, by correspondence with the custodian and brokers; and where
confirmations were not received from brokers, we performed other auditing
procedures. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Fund as of June 30, 1996, the results of its operations for the year
then ended, the changes in its net assets for each of the years in the two-year
period then ended, and the financial highlights for each of the years in the
five-year period then ended, in conformity with generally accepted accounting
principles.
KPMG Peat Marwick LLP
Denver, Colorado
July 22, 1996
21 Oppenheimer Fund
<PAGE>
Federal Income Tax Information (Unaudited)
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In early 1997, shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1996. Regulations of
the U.S. Treasury Department require the Fund to report this information to the
Internal Revenue Service.
Distributions of $1.0892, $1.0887 and $1.0254 per share were paid to Class
A, Class B and Class C shareholders, respectively, on December 27, 1995, of
which, for each class of shares, $.8963 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, 1996 which
are not designated as capital gain distributions should be multiplied by 44.06%
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.
22 Oppenheimer Fund
<PAGE>
Oppenheimer Fund
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Officers and Trustees
Leon Levy, Chairman of the Board of Trustees
Donald W. Spiro, Vice Chairman of the Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Richard Rubinstein, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
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Investment Advisor
OppenheimerFunds, Inc.
- --------------------------------------------------------------------------------
Distributor
OppenheimerFunds Distributor, Inc.
- --------------------------------------------------------------------------------
Transfer and Shareholder
Servicing Agent
OppenheimerFunds Services
- --------------------------------------------------------------------------------
Custodian of
Portfolio Securities
The Bank of New York
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Independent Auditors
KPMG Peat Marwick LLP
- --------------------------------------------------------------------------------
Legal Counsel
Gordon Altman Butowsky Weitzen Shalov & Wein
This is a copy of a report to shareholders of Oppenheimer Fund. This report must
be preceded or accompanied by a Prospectus of Oppenheimer Fund. For material
information concerning the Fund, see the Prospectus.
Shares of Oppenheimer funds are not deposits or obligations of any bank, are not
guaranteed by any bank, and are not insured by the FDIC or any other agency, and
involve investment risks, including possible loss of the principal amount
invested.
23 Oppenheimer Fund
<PAGE>
[Back cover]
Information
General Information
Monday-Friday 8:30 a.m.-9 p.m. ET
Saturday 10 a.m.-2 p.m. ET
1-800-525-7048
Telephone Transactions
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-852-8457
PhoneLink
24 hours a day, automated
information and transactions
1-800-533-3310
Telecommunications Device
for the Deaf (TDD)
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-843-4461
OppenheimerFunds
Information Hotline
24 hours a day, timely and insightful
messages on the economy and
issues that affect your investments
1-800-835-3104
RA0400.001.0696 August 31, 1996
[Picture of Jennifer Leonard]
[Caption] Jennifer Leonard, Customer Service Representative
OppenheimerFunds Services
"How may I help you?"
As an Oppenheimer fund shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your Oppenheimer funds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
[LOGO-OPPENHEIMERFUNDS(R)]
OppenheimerFunds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
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Bulk Rate
U.S. Postage
PAID
Permit No. 469
Denver, CO
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