<PAGE> 1
OPPENHEIMER SPECIAL FUND
ANNUAL REPORT JUNE 30, 1994
(OPPENHEIMERFUNDS(R) LOGO)
"I HAVE MANY LONG-RANGE FINANCIAL
GOALS--PAYING FOR COLLEGE, BUYING
A HOUSE, PLANNING FOR RETIREMENT--
SO I WANT THE KIND OF INVESTMENT
GROWTH ONLY AVAILABLE FROM STOCKS.
"THIS FUND FITS INTO MY PLANS BECAUSE
IT SEEKS OUT THE BEST VALUES IN THE
STOCK MARKET, SO I CAN GET THE POTENTIAL
FOR CAPITAL APPRECIATION THAT I NEED."
<PAGE> 2
FUND FACTS
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 STRATEGIES?
* WHY IS THE FUND EMPHASIZING SHARES OF FINANCIAL SERVICES COMPANIES?
* WHAT'S THE OUTLOOK FOR TECHNOLOGY AND HEALTHCARE STOCKS, TWO SECTORS THE FUND
HAS BEEN FAVORING LATELY?
FACTS EVERY SHAREHOLDER SHOULD KNOW ABOUT
OPPENHEIMER SPECIAL FUND
- -------------------------------------------------------------------------------
1 The Fund seeks long-term capital appreciation from a portfolio of
common stocks issued by growth companies that offer growth
possibilities while retaining a flexible approach to investing.
Emphasis is presently placed on out-of-favor industries which should
benefit from anticipated changes in the economic environment.
- -------------------------------------------------------------------------------
2 Total return at net asset value for Class A shares was 0.27% for the
12-month period ended June 30, 1994. For Class B shares, total return
at net asset value since inception on August 17, 1993 was -0.20%.(1)
- -------------------------------------------------------------------------------
3 Average annual total returns for Class A shares for the 1-, 5- and
10-year periods ended June 30, 1994 were -5.50%, 9.57%, and 10.64%,
respectively. The total return for Class B shares since inception on
August 17, 1993 was -5.19%.(2)
- -------------------------------------------------------------------------------
4 The Fund's top five holdings in the portfolio at June 30, 1994
were:(3)
MICROSOFT CORP. A producer of software for microcomputers.
INTEL CORP. A premier producer of semiconductor chips for the computer
industry.
COMPUTER ASSOCIATES INTERNATIONAL, INC. Manufactures systems software
packages.
UNITED HEALTHCARE CORP. One of the nation's largest health maintenance
organizations.
FEDERAL NATIONAL MORTGAGE ASSOCIATION. Provides residential mortgages.
- -------------------------------------------------------------------------------
5 "The stocks we focus on have relatively low valuations, and their
strong earnings momentum provides plenty of appreciation potential."
Portfolio Manager Bob Doll, June 30, 1994
(1) Based on the change in net asset value per share for the periods shown,
without deducting any sales charge. Such performance would be lower if sales
charges had been deducted.
(2) Average annual total returns are based on a hypothetical investment held
until 6/30/94, after deducting the current maximum initial sales charge of
5.75% for Class A shares on 6/30/93, 6/30/89, and 6/30/84, respectively. The
Fund's maximum sales charge rate was higher during a portion of the periods
shown, and actual investment results will be different as a result of the
change. The total return for Class B shares was based on a hypothetical
investment held until 6/30/94, after deducting the 5% contingent deferred sales
charge.
(3) The Fund's portfolio is subject to change.
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.
2 Oppenheimer Special Fund
<PAGE> 3
REPORT TO SHAREHOLDERS
ABOVE-AVERAGE
LONG-TERM GROWTH
Cumulative total return for the
5-year period ended 6/30/94
- --------------------------------------------------
Oppenheimer 67.57%
Special Fund A(4)
(at NAV)
- --------------------------------------------------
S&P 500 Index(5) 63.32%
- --------------------------------------------------
Lipper growth 60.86%
funds average(6)
It is a pleasure to send you the annual report for Oppenheimer Special Fund.
As noted in our last report, as the stock market moved to record highs and
interest rates moved to post-war lows toward the end of 1993, your managers
began reducing the Fund's positions in so-called deep-cyclical stocks--stocks
issued by industrial companies and commodity producers whose earning power
depends on powerful economic growth.
This approach was rewarded in the first six months of 1994. As the
Federal Reserve raised short-term interest rates four times between early
February and mid-May, the prices of cyclical stocks were hit hard, while stocks
on which your managers focused--notably financial, technology, and healthcare
issues--performed relatively well.
Over the last six months, your managers used market upturns to take
profits in companies whose prices seemed to have reached their peak. For
example, they reduced the Fund's position in Cordis Corp., whose stock price
rose sharply over the past year. The proceeds of these sales were used, in
turn, to invest in companies whose earnings potential hasn't been fully
reflected in their stock prices.
The correction in financial services stocks that took place toward the
end of 1993 offered solid opportunities to add to positions in financial
companies with strong earnings outlooks and attractive stock prices, such as
Lincoln National, a life and health insurer, and Advanta, a fast-growing credit
card issuer. Likewise, last year's correction in the prices of healthcare
stocks offered opportunities to capitalize on the industry's rapid
restructuring. Significant holdings in this sector include U.S. Healthcare and
Abbott Labs. Finally, with the gradually growing economy, we continued to look
for stocks that offered cyclical as well as long-term growth opportunities, and
found them in the technology sector. Companies like Intel and Microsoft not
only have strong long-term prospects, they are well positioned to benefit from
rising business and consumer spending today, both in the U.S. and
internationally.
As we enter the second half of 1994, the Fund's outlook is bright.
While gains may come more gradually than they did when interest rates were
falling, the U.S. and global economies are growing at a gradual, sustainable
pace, inflation remains low, and barring any unforeseen developments, interest
rate increases are likely to occur at a slower rate. Performance will depend on
careful stock selection. Fortunately, as the Fund's five-year performance
record shows, the ability to identify long-term value and deliver above-average
returns is Oppenheimer Special Fund's greatest strength.
We appreciate the trust you have placed in Oppenheimer Special Fund,
and we look forward to continuing to help you reach your investment goals.
/s/ DONALD W. SPIRO
- -------------------
Donald W. Spiro
President, Oppenheimer Special Fund
July 22, 1994
(4) See footnote 1, page 2.
(5) The Standard & Poor's 500 Index is an unmanaged index of common stocks that
is widely recognized as an indicator of overall market performance. The S&P
Index includes dividend reinvestments but does not take capital gains
distributions into consideration.
(6) Source of data: Lipper Analytical Services. The Lipper total return average
for the 5-year period was for 212 growth funds. The average is shown for
comparative purposes only. Oppenheimer Special Fund is characterized by Lipper
as a growth fund. Lipper performance does not take sales charges into
consideration.
3 Oppenheimer Special Fund
<PAGE> 4
STATEMENT OF INVESTMENTS JUNE 30, 1994
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
================================================================================================================================
<S> <C> <C> <C>
REPURCHASE AGREEMENTS--11.1%
- --------------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with The First
Boston Corp., 4.125% dated 6/30/94,
to be repurchased at $74,108,491
on 7/1/94, collateralized by U.S.
Treasury Nts., 4%, 1/31/96, with a
value of $75,668,951 (Cost $74,100,000) $74,100,000 $74,100,000
</TABLE>
<TABLE>
<CAPTION>
SHARES
================================================================================================================================
<S> <C> <C> <C>
COMMON STOCKS--89.0%
- --------------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--0.7%
- --------------------------------------------------------------------------------------------------------------------------------
CHEMICALS--0.6% Great Lakes Chemical Corp. 45,000 2,435,625
-------------------------------------------------------------------------------------
Sigma Aldrich Corp. 40,000 1,600,000
-----------
4,035,625
- --------------------------------------------------------------------------------------------------------------------------------
CHEMICALS: DIVERSIFIED--0.1% FMC Corp.(1) 15,000 811,875
- --------------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--10.8%
- --------------------------------------------------------------------------------------------------------------------------------
AUTO PARTS: AFTER MARKET--0.4% Goodyear Tire & Rubber Co. 70,000 2,520,000
- --------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILES--0.3% Harley-Davidson, Inc. 40,000 1,830,000
-------------------------------------------------------------------------------------
Navistar International Corp.(1) 15,000 200,625
-----------
2,030,625
- --------------------------------------------------------------------------------------------------------------------------------
BROADCAST MEDIA--0.2% Multimedia, Inc.(1) 45,000 1,305,000
- --------------------------------------------------------------------------------------------------------------------------------
ENTERTAINMENT--0.3% King World Productions, Inc.(1) 5,000 199,375
-------------------------------------------------------------------------------------
WMS Industries, Inc.(1) 80,000 1,520,000
-----------
1,719,375
- --------------------------------------------------------------------------------------------------------------------------------
HOMEBUILDING--0.0% Webb (Del E.) Corp. 11,300 177,975
- --------------------------------------------------------------------------------------------------------------------------------
LEISURE TIME--0.3% Acclaim Entertainment, Inc.(1) 130,000 2,108,444
- --------------------------------------------------------------------------------------------------------------------------------
PUBLISHING--0.1% Marvel Entertainment Group, Inc.(1) 50,000 912,500
- --------------------------------------------------------------------------------------------------------------------------------
RESTAURANTS--1.6% Brinker International, Inc.(1) 45,000 945,000
-------------------------------------------------------------------------------------
McDonald's Corp. 110,000 3,176,250
-------------------------------------------------------------------------------------
Pancho's Mexican Buffet, Inc. 100,000 925,000
-------------------------------------------------------------------------------------
Shoney's, Inc.(1) 360,000 5,490,000
-----------
10,536,250
- --------------------------------------------------------------------------------------------------------------------------------
RETAIL: SPECIALTY--3.6% Blockbuster Entertainment Corp. 15,000 388,125
-------------------------------------------------------------------------------------
Circuit City Stores, Inc. 245,000 5,022,500
-------------------------------------------------------------------------------------
Claire's Stores, Inc. 75,000 768,750
-------------------------------------------------------------------------------------
CML Group, Inc. 79,600 935,300
-------------------------------------------------------------------------------------
Edison Brothers Stores, Inc. 55,000 1,388,750
-------------------------------------------------------------------------------------
Home Depot, Inc. (The) 120,000 5,055,000
-------------------------------------------------------------------------------------
Intelligent Electronics, Inc. 170,000 2,571,250
-------------------------------------------------------------------------------------
Michaels Stores, Inc.(1) 90,000 3,026,250
-------------------------------------------------------------------------------------
Rocky Mountain Chocolate Factory, Inc.(2) 100,000 1,325,000
-------------------------------------------------------------------------------------
Service Merchandise Co., Inc.(1) 180,000 1,147,500
-------------------------------------------------------------------------------------
Sotheby's Holdings, Inc., Cl. A 170,000 2,103,750
-----------
23,732,175
</TABLE>
4 Oppenheimer Special Fund
<PAGE> 5
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
RETAIL: SPECIALTY APPAREL--1.0% Gap, Inc. (The) 140,000 $ 5,985,000
-------------------------------------------------------------------------------------
Lands' End, Inc. 20,000 347,500
-----------
6,332,500
- --------------------------------------------------------------------------------------------------------------------------------
RETAIL STORES: May Department Stores Co. 25,000 981,250
DEPARTMENT STORES--0.2%
- --------------------------------------------------------------------------------------------------------------------------------
RETAIL STORES: GENERAL Wal-Mart Stores, Inc. 450,000 10,912,500
MERCHANDISE CHAINS--1.6%
- --------------------------------------------------------------------------------------------------------------------------------
SHOES--0.3% Reebok International Ltd. 60,000 1,792,500
- --------------------------------------------------------------------------------------------------------------------------------
TEXTILES: APPAREL Fruit of the Loom, Inc., Cl. A(1) 160,000 4,180,000
MANUFACTURERS--0.6%
- --------------------------------------------------------------------------------------------------------------------------------
TOYS--0.3% Hasbro, Inc. 40,000 1,185,000
-------------------------------------------------------------------------------------
Mattel, Inc. 43,750 1,110,156
-----------
2,295,156
- --------------------------------------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS--25.1%
- --------------------------------------------------------------------------------------------------------------------------------
BEVERAGES: SOFT DRINKS--3.1% Coca-Cola Co. (The) 255,000 10,359,375
-------------------------------------------------------------------------------------
PepsiCo, Inc 330,000 10,106,250
-----------
20,465,625
- --------------------------------------------------------------------------------------------------------------------------------
DRUGS--5.3% Forest Laboratories, Inc.(1) 45,000 1,957,500
-------------------------------------------------------------------------------------
Merck & Co., Inc. 212,500 6,321,875
-------------------------------------------------------------------------------------
Mylan Laboratories, Inc. 140,000 2,975,000
-------------------------------------------------------------------------------------
Pfizer, Inc. 120,000 7,575,000
-------------------------------------------------------------------------------------
Schering-Plough Corp. 200,000 12,250,000
-------------------------------------------------------------------------------------
Upjohn Co. 148,400 4,322,150
-----------
35,401,525
- --------------------------------------------------------------------------------------------------------------------------------
FOOD PROCESSING--1.9% ConAgra, Inc. 125,000 3,812,500
-------------------------------------------------------------------------------------
General Mills, Inc. 20,000 1,092,500
-------------------------------------------------------------------------------------
IBP, Inc. 40,000 1,065,000
-------------------------------------------------------------------------------------
Kellog Co. 15,000 815,625
-------------------------------------------------------------------------------------
Sara Lee Corp. 150,000 3,187,500
-------------------------------------------------------------------------------------
Tyson Foods, Inc., Cl. A 120,000 2,805,000
-----------
12,778,125
- --------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE: DIVERSIFIED--3.9% Abbott Laboratories 450,000 13,050,000
-------------------------------------------------------------------------------------
American Home Products Corp. 90,000 5,107,500
-------------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 75,000 4,021,875
-------------------------------------------------------------------------------------
IVAX Corp. 50,000 818,750
-------------------------------------------------------------------------------------
Warner-Lambert Co. 45,000 2,970,000
-----------
25,968,125
- --------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE: National Health Laboratories, Inc. 400,000 4,850,000
MISCELLANEOUS--4.7% -------------------------------------------------------------------------------------
United Healthcare Corp. 300,000 13,762,500
-------------------------------------------------------------------------------------
U.S. Healthcare, Inc. 340,000 12,580,000
------------
31,192,500
</TABLE>
5 Oppenheimer Special Fund
<PAGE> 6
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
HOSPITAL MANAGEMENT--0.2% Novacare, Inc.(1) 50,100 $ 801,600
-------------------------------------------------------------------------------------
Surgical Care Affiliates, Inc. 20,000 265,000
-----------
1,066,600
- --------------------------------------------------------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--0.2% Colgate-Palmolive Co. 30,000 1,560,000
- --------------------------------------------------------------------------------------------------------------------------------
MEDICAL PRODUCTS--3.9% Cordis Corp.(1) 275,000 10,673,437
-------------------------------------------------------------------------------------
Medtronic, Inc. 135,000 10,816,875
-------------------------------------------------------------------------------------
Rhone-Poulenc Rorer, Inc. 10,000 305,000
-------------------------------------------------------------------------------------
Sci-Med Life Systems, Inc.(1) 150,000 3,900,000
-----------
25,695,312
- --------------------------------------------------------------------------------------------------------------------------------
RETAIL STORES: Vons Cos., Inc. (The)(1) 25,000 425,000
FOOD CHAINS--0.1%
- --------------------------------------------------------------------------------------------------------------------------------
TOBACCO--1.8% American Brands, Inc. 25,000 790,625
-------------------------------------------------------------------------------------
Phillip Morris Cos., Inc. 155,000 7,982,500
-------------------------------------------------------------------------------------
UST, Inc. 129,000 3,499,125
-----------
12,272,250
- --------------------------------------------------------------------------------------------------------------------------------
ENERGY--0.6%
- --------------------------------------------------------------------------------------------------------------------------------
OIL: EXPLORATION & Maxus Energy Corp.(1) 214,700 1,073,500
PRODUCTION--0.2%
- --------------------------------------------------------------------------------------------------------------------------------
OIL: INTEGRATED DOMESTIC--0.1% Quaker State Corp. 60,000 840,000
- --------------------------------------------------------------------------------------------------------------------------------
OIL WELL SERVICES McDermott International, Inc. 90,000 2,250,000
AND EQUIPMENT--0.3%
- --------------------------------------------------------------------------------------------------------------------------------
FINANCIAL--25.4%
- --------------------------------------------------------------------------------------------------------------------------------
FINANCIAL SERVICES: Advanta Corp., Cl. A 215,000 7,659,375
MISCELLANEOUS--12.2% -------------------------------------------------------------------------------------
Bear Stearns Cos., Inc. (The) 404,250 6,872,250
-------------------------------------------------------------------------------------
Countrywide Credit Industries, Inc. 322,500 4,635,938
-------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. 40,000 2,420,000
-------------------------------------------------------------------------------------
Federal National Mortgage Assn. 160,000 13,360,000
-------------------------------------------------------------------------------------
Green Tree Financial Corp. 160,000 8,960,000
-------------------------------------------------------------------------------------
Household International, Inc. 25,000 850,000
-------------------------------------------------------------------------------------
MBIA, Inc. 15,000 860,625
-------------------------------------------------------------------------------------
Morgan Stanley Group, Inc. 60,000 3,412,500
-------------------------------------------------------------------------------------
PaineWebber Group, Inc. 420,000 6,562,500
-------------------------------------------------------------------------------------
Raymond James Financial, Inc. 17,500 253,750
-------------------------------------------------------------------------------------
Salomon, Inc. 40,000 1,910,000
-------------------------------------------------------------------------------------
Schwab (Charles) Corp. (The) 150,000 3,712,500
-------------------------------------------------------------------------------------
Student Loan Marketing Assn. 130,000 4,680,000
-------------------------------------------------------------------------------------
Sunamerica, Inc. 65,000 2,656,875
-------------------------------------------------------------------------------------
Travelers, Inc. 374,600 12,080,850
-----------
80,887,163
</TABLE>
6 Oppenheimer Special Fund
<PAGE> 7
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INSURANCE: LIFE--2.7% AFLAC, Inc. 71,875 $ 2,425,781
-------------------------------------------------------------------------------------
Conseco, Inc. 255,000 11,889,375
-------------------------------------------------------------------------------------
Lincoln National Corp. 40,000 1,695,000
-------------------------------------------------------------------------------------
Torchmark Corp. 20,000 780,000
-------------------------------------------------------------------------------------
UNUM Corp. 30,000 1,342,500
-----------
18,132,656
- --------------------------------------------------------------------------------------------------------------------------------
INSURANCE: MULTI-LINE--0.1% Allstate Corp. 30,000 712,500
- --------------------------------------------------------------------------------------------------------------------------------
INSURANCE: PROPERTY Continental Corp. 30,000 465,000
AND CASUALTY--1.4% -------------------------------------------------------------------------------------
Loews Corp. 25,000 2,131,250
-------------------------------------------------------------------------------------
Progressive Corp. 40,000 1,330,000
-------------------------------------------------------------------------------------
USF&G Corp. 450,000 5,512,500
-----------
9,438,750
- --------------------------------------------------------------------------------------------------------------------------------
MAJOR BANKS: OTHER--1.5% Bank of Boston Corp. 400,000 9,850,000
- --------------------------------------------------------------------------------------------------------------------------------
MAJOR BANKS: REGIONAL--6.8% Banc One Corp. 82,500 2,825,625
-------------------------------------------------------------------------------------
First Interstate Bancorp. 95,000 7,315,000
-------------------------------------------------------------------------------------
First Union Corp. 70,000 3,228,750
-------------------------------------------------------------------------------------
KeyCorp. 234,975 7,489,828
-------------------------------------------------------------------------------------
Midlantic Corp. 190,000 5,557,500
-------------------------------------------------------------------------------------
NationsBank Corp. 10,000 513,750
-------------------------------------------------------------------------------------
Shawmut National Corp. 240,000 5,280,000
-------------------------------------------------------------------------------------
Signet Banking Corp. 200,000 8,075,000
-------------------------------------------------------------------------------------
SouthTrust Corp. 170,000 3,463,750
-------------------------------------------------------------------------------------
SunTrust Banks, Inc. 20,000 967,500
-------------------------------------------------------------------------------------
Washington Mutual Savings Bank of Seattle 35,000 721,875
-----------
45,438,578
- --------------------------------------------------------------------------------------------------------------------------------
MONEY CENTER BANKS--0.7% Chase Manhattan Corp. 30,000 1,147,500
-------------------------------------------------------------------------------------
Chemical Banking Corp. 90,000 3,465,000
-----------
4,612,500
- --------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL--3.5%
- --------------------------------------------------------------------------------------------------------------------------------
COMMERCIAL SERVICES--0.7% Comdisco, Inc. 215,000 4,111,875
-------------------------------------------------------------------------------------
Mercury Air Group, Inc.(1) 100,000 537,500
-----------
4,649,375
- --------------------------------------------------------------------------------------------------------------------------------
CONTAINERS: METAL Crown Cork & Seal Co., Inc.(1) 20,000 745,000
AND GLASS--0.1%
- --------------------------------------------------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--1.8% General Electric Co. 250,000 11,656,250
- --------------------------------------------------------------------------------------------------------------------------------
MACHINERY: DIVERSIFIED--0.7% Varity Corp.(1) 135,000 4,910,625
- --------------------------------------------------------------------------------------------------------------------------------
POLLUTION CONTROL--0.0% Yellowstone Environmental Services, Inc.(1) 100,000 6,250
- --------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION: American President Cos. Ltd. 60,000 1,342,500
MISCELLANEOUS--0.2%
</TABLE>
7 Oppenheimer Special Fund
<PAGE> 8
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TECHNOLOGY--20.9%
- --------------------------------------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE--0.6% Northrop Corp. 90,000 $ 3,341,250
- --------------------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE Adobe Systems, Inc. 35,000 953,750
AND SERVICES--9.6% -------------------------------------------------------------------------------------
Automatic Data Processing, Inc. 206,800 10,986,250
-------------------------------------------------------------------------------------
BMC Software, Inc.(1) 40,000 1,750,000
-------------------------------------------------------------------------------------
Ceridian Corp.(1) 60,000 1,477,500
-------------------------------------------------------------------------------------
Computer Associates International, Inc. 375,000 15,000,000
-------------------------------------------------------------------------------------
Computer Sciences Corp.(1) 150,000 6,243,750
-------------------------------------------------------------------------------------
Electronic Arts, Inc.(1) 165,000 2,310,000
-------------------------------------------------------------------------------------
General Motors Corp., Cl. E 200,000 6,975,000
-------------------------------------------------------------------------------------
Microsoft Corp.(1) 350,000 18,025,000
-------------------------------------------------------------------------------------
Oracle Systems Corp.(1) 10,000 375,000
-----------
64,096,250
- --------------------------------------------------------------------------------------------------------------------------------
COMPUTER SYSTEMS--6.6% AST Research, Inc.(1) 237,500 3,384,375
-------------------------------------------------------------------------------------
Cabletron Systems, Inc.(1) 135,000 13,044,375
-------------------------------------------------------------------------------------
Cisco Systems, Inc.(1) 90,000 2,103,750
-------------------------------------------------------------------------------------
Compaq Computer Corp.(1) 60,000 1,935,000
-------------------------------------------------------------------------------------
Data General Corp.(1) 126,500 980,375
-------------------------------------------------------------------------------------
Maxtor Corp.(1) 19,500 97,500
-------------------------------------------------------------------------------------
Quantum Corp.(1) 110,000 1,423,125
-------------------------------------------------------------------------------------
Seagate Technology(1) 280,000 5,530,000
-------------------------------------------------------------------------------------
3Com Corp.(1) 95,000 4,880,625
-------------------------------------------------------------------------------------
Unisys Corp.(1) 680,000 6,290,000
-------------------------------------------------------------------------------------
Western Digital Corp.(1) 325,000 4,143,750
-----------
43,812,875
- --------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS: American Power Conversion Corp.(1) 140,000 2,257,500
INSTRUMENTATION--0.4% -------------------------------------------------------------------------------------
Linear Technology Corp. 7,000 308,000
-----------
2,565,500
- --------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS: Advanced Micro Devices, Inc.(1) 35,000 870,625
SEMICONDUCTORS--2.8% -------------------------------------------------------------------------------------
Intel Corp. 300,000 17,550,000
-------------------------------------------------------------------------------------
VLSI Technology, Inc.(1) 15,000 205,313
-----------
18,625,938
- --------------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS--1.0% American Telephone & Telegraph Co. 95,000 5,165,625
-------------------------------------------------------------------------------------
Hong Kong Telecommunications Ltd., Sponsored ADR 75,000 1,406,250
-----------
6,571,875
- --------------------------------------------------------------------------------------------------------------------------------
UTILITIES--2.0%
- --------------------------------------------------------------------------------------------------------------------------------
TELEPHONE--2.0% Telefonica de Espana SA, Sponsored ADR 40,000 1,610,000
-------------------------------------------------------------------------------------
Telefonos de Mexico SA, Sponsored ADR 210,000 11,733,750
------------
13,343,750
------------
Total Common Stocks (Cost $428,145,095) 592,111,897
</TABLE>
8 Oppenheimer Special Fund
<PAGE> 9
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TOTAL INVESTMENTS, AT VALUE (COST $502,245,095) 100% $666,211,897
- --------------------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (.1) (521,790)
------------
NET ASSETS 100.00% $665,690,107
====== ============
</TABLE>
(1) Non-income producing security.
(2) Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer and was an affiliate, as defined in the Investment
Company Act of 1940, during the year ended June 30, 1994. The aggregate fair
value and cost of all securities of affiliated companies as of June 30, 1994
amounted to $1,325,000. There were no transactions with affiliates during the
year ended June 30, 1994. Rocky Mountain Chocolate Factory, Inc. is no longer an
affiliate as of June 30, 1994.
See accompanying Notes to Financial Statements.
9 Oppenheimer Special Fund
<PAGE> 10
STATEMENT OF ASSETS AND LIABILITIES June 30, 1994
<TABLE>
<S> <C> <C>
================================================================================================================================
ASSETS Investments, at value (cost $502,245,095)--see accompanying statement $666,211,897
-------------------------------------------------------------------------------------
Cash 1,033,763
-------------------------------------------------------------------------------------
Receivables:
Dividends and interest 826,173
Investments sold 577,625
Shares of beneficial interest sold 306,693
-------------------------------------------------------------------------------------
Other 294,070
------------
Total assets 669,250,221
================================================================================================================================
LIABILITIES Payables and other liabilities:
Shares of beneficial interest redeemed 1,885,026
Investments purchased 926,762
Distribution and service plan fees--Note 4 295,348
Other 452,978
------------
Total liabilities 3,560,114
================================================================================================================================
NET ASSETS $665,690,107
============
================================================================================================================================
COMPOSITION OF Paid-in capital $447,255,344
NET ASSETS -------------------------------------------------------------------------------------
Undistributed net investment income 2,259,799
-------------------------------------------------------------------------------------
Accumulated net realized gain from investment transactions 52,208,162
-------------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 163,966,802
------------
Net assets $665,690,107
============
================================================================================================================================
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on net assets
of $656,933,970 and 24,653,871 shares of beneficial interest
outstanding) $26.65
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $28.28
-------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based
on net assets of $8,746,652 and 330,820 shares of beneficial interest
outstanding) $26.44
-------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based
on net assets of $9,485 and 356 shares of beneficial interest
outstanding) $26.64
</TABLE>
See accompanying Notes to Financial Statements.
10 Oppenheimer Special Fund
<PAGE> 11
STATEMENT OF OPERATIONS For the Year Ended June 30, 1994
<TABLE>
<S> <C> <C>
================================================================================================================================
INVESTMENT INCOME Dividends $ 10,278,573
-------------------------------------------------------------------------------------
Interest 1,494,078
-----------
Total income 11,772,651
================================================================================================================================
EXPENSES Management fees--Note 4 5,149,361
-------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A--Note 4 979,081
Class B--Note 4 44,228
-------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 824,213
-------------------------------------------------------------------------------------
Shareholder reports 471,400
-------------------------------------------------------------------------------------
Trustees' fees and expenses 66,717
-------------------------------------------------------------------------------------
Custodian fees and expenses 63,460
-------------------------------------------------------------------------------------
Legal and auditing fees 48,937
-------------------------------------------------------------------------------------
Registration and filing fees:
Class B 2,265
Class Y 3
-------------------------------------------------------------------------------------
Other 134,987
-----------
Total expenses 7,784,652
================================================================================================================================
NET INVESTMENT INCOME 3,987,999
================================================================================================================================
REALIZED AND UNREALIZED Net realized gain on investments 52,653,524
GAIN (LOSS) ON INVESTMENTS
-------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on
investments (52,680,765)
-----------
Net realized and unrealized loss on investments (27,241)
================================================================================================================================
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 3,960,758
============
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Special Fund
<PAGE> 12
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
1994 1993
================================================================================================================================
<S> <C> <C> <C>
OPERATIONS Net Investment income $ 3,987,999 $ 5,089,258
-------------------------------------------------------------------------------------
Net realized gain on investments 52,653,524 35,809,298
-------------------------------------------------------------------------------------
Net change in unrealized appreciation or
depreciation on investments (52,680,765) 64,418,678
------------ ------------
Net increase in net assets resulting from
operations 3,960,758 105,317,234
================================================================================================================================
DIVIDENDS AND Dividends from net investment income:
DISTRIBUTIONS TO Class A ($.153 and $.245 per share, respectively) (3,966,692) (6,227,354)
SHAREHOLDERS Class B ($.105 per share) (17,924) --
-------------------------------------------------------------------------------------
Dividends in excess of net investment income:
Class A ($.002 per share) (59,612) --
Class B ($.002 per share) (269) --
-------------------------------------------------------------------------------------
Distributions from net realized gain on investments:
Class A ($.639 and $1.571 per share, respectively) (16,628,635) (39,984,953)
Class B ($.639 per share) (108,539) --
================================================================================================================================
BENEFICIAL INTEREST Net increase (decrease) in net assets resulting from
TRANSACTIONS Class A beneficial interest transactions--Note 2 (70,528,976) 53,957,646
-------------------------------------------------------------------------------------
Net increase in net assets resulting from Class B
beneficial interest transactions--Note 2 9,199,957 --
-------------------------------------------------------------------------------------
Net increase in net assets resulting from Class Y
beneficial interest transactions--Note 2 10,000 --
================================================================================================================================
NET ASSETS Total increase (decrease) (78,139,932) 113,062,573
-------------------------------------------------------------------------------------
Beginning of year 743,830,039 630,767,466
------------ ------------
End of year (including undistributed net investment
income of $2,259,799 and $2,818,869, respectively) $665,690,107 $743,830,039
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
12 Oppenheimer Special Fund
<PAGE> 13
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------------------------------------
YEAR ENDED JUNE 30,
1994 1993 1992 1991 1990 1989 1988 1987
==============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $ 27.34 $ 24.94 $ 21.88 $ 20.60 $ 18.90 $ 17.13 $ 20.37 $ 23.82
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment
operations:
Net investment income (loss) .16 .19 .29 .47 .64 .62 .67 .93
Net realized and unrealized
gain (loss) on investments (.05) 4.03 3.13 1.36 1.76 1.78 (.89) .59
-------- -------- -------- -------- -------- -------- -------- -------
Total income (loss) from
investment operations .11 4.22 3.42 1.83 2.40 2.40 (.22) 1.52
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders:
Dividends from net
investment income (.16) (.25) (.36) (.55) (.70) (.59) (1.27) (.77)
Distributions in excess
of net investment income --(6) -- -- -- -- -- -- --
Distributions from net realized
gain on investments (.64) (1.57) -- -- -- (.04) (1.75) (4.20)
-------- -------- -------- -------- -------- -------- -------- -------
Total dividends and distributions
to shareholders (.80) (1.82) (.36) (.55) (.70) (.63) (3.02) (4.97)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 26.65 $ 27.34 $ 24.94 $ 21.88 $ 20.60 $ 18.90 $ 17.13 $ 20.37
======== ======== ======== ======== ======== ======== ======== =======
==============================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(3) .27% 16.88% 15.69% 9.39% 12.98% 14.54% (1.03)% 9.48%
==============================================================================================================================
RATIO/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $656,934 $743,830 $630,767 $550,480 $551,295 $542,250 $552,863 $690,326
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $720,765 $710,391 $624,527 $520,335 $547,090 $529,699 $570,250 $717,115
- ------------------------------------------------------------------------------------------------------------------------------
Number of shares outstanding
at end of period (in thousands) 24,654 27,210 25,287 25,155 26,760 28,687 32,277 33,890
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) .56% .72% 1.14% 2.20% 3.07% 3.31% 3.78% 4.32%
Expenses 1.07% .93% .90% .94% .92% .97% .95% .93%
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 19.8% 23.2% 36.7% 31.1% 27.6% 27.1% 120.3% 371.2%
</TABLE>
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS Y
- ----------------------------------------------------------------- --------------- ------------
PERIOD ENDED PERIOD ENDED
YEAR ENDED JUNE 30, JUNE 30, JUNE 30,
1986 1985 1994(2) 1994(1)
==================================================================================================
<S> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $ 20.46 $ 19.45 $27.02 $28.08
- --------------------------------------------------------------------------------------------------
Income (loss) from investment
operations:
Net investment income (loss) .75 .60 (.04) .02
Net realized and unrealized
gain (loss) on investments 3.70 1.87 .21 (1.46)
-------- -------- ------ ------
Total income (loss) from
investment operations 4.45 2.47 .17 (1.44)
- --------------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders:
Dividends from net
investment income (.61) (.39) (.11) --
Distributions in excess
of net investment income -- -- --(6) --
Distributions from net realized
gain on investments (.48) (1.07) (.64) --
-------- -------- ------ ------
Total dividends and distributions
to shareholders (1.09) (1.46) (.75) --
- --------------------------------------------------------------------------------------------------
Net asset value, end of period $ 23.82 $ 20.46 $26.44 $26.64
======== ======== ====== ======
==================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(3) 22.77% 14.24% (.20)% (5.13)%
==================================================================================================
RATIO/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $772,619 $834,054 $8,747 $ 9
- --------------------------------------------------------------------------------------------------
Average net assets (in thousands) $783,491 $765,214 $5,119 $ 10
- --------------------------------------------------------------------------------------------------
Number of shares outstanding
at end of period (in thousands) 32,437 40,759 331 --
- --------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 3.03% 3.28% (.22)%(4) 1.09%(4)
Expenses .95% .94% 1.98%(4) 1.25%(4)
- --------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 67.4% 16.8% 19.8% 19.8%
</TABLE>
(1) For the period from June 1, 1994 (inception of offering) to June 30, 1994.
(2) For the period from August 17, 1993 (inception of offering) to June 30,
1994. Per share amounts calculated based on the weighted average number of
shares outstanding during the period.
(3) Assumes a hypothetical initial investment on the business day before the
first day of the fiscal year, 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.
(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, 1994 were $134,329,584 and $246,835,478,
respectively.
(6) Less than $.005 per share.
See accompanying Notes to Financial Statements.
13 Oppenheimer Special Fund
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS
==============================================================================
1. SIGNIFICANT
ACCOUNTING POLICIES Oppenheimer Special 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 Class A, Class B and
Class Y shares. Class A shares are sold with a
front-end sales charge. Class B shares may be
subject to a contingent deferred sales charge.
All three classes of shares have identical rights
to earnings, assets and voting privileges, except
that each class has its own expenses directly
attributable to a particular class and exclusive
voting rights with respect to matters affecting a
single class. Classes A and B have separate
distribution and/or service plans. 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. 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.
------------------------------------------------
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.
------------------------------------------------
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.
------------------------------------------------
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. The accumulated liability
for the Fund's projected benefit obligations was
$127,168 at June 30, 1994. No payments have been
made under the plan.
------------------------------------------------
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 Distributions by Investment
Companies. As a result, 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, subsequent to June 30,
1993, amounts have been reclassified to reflect
an increase in paid-in capital of $2,809,456, a
decrease in undistributed net investment income
of $502,572, and a decrease in undistributed
capital gain on investments of $2,306,884.
------------------------------------------------
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. 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.
14 Oppenheimer Special Fund
<PAGE> 15
===============================================================================
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:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1994(1) YEAR ENDED JUNE 30, 1993
--------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Sold 3,332,175 $ 92,525,655 5,518,247 $149,845,978
Dividends and distributions
reinvested 719,996 19,958,287 1,627,898 44,669,529
Redeemed (6,608,134) (183,012,918) (5,223,558) (140,557,861)
---------- ------------ ---------- ------------
Net increase (decrease) (2,555,963) $(70,528,976) 1,922,587 $ 53,957,646
========== ============ ========== ============
-------------------------------------------------------------------------------------------------
Class B
Sold 398,782 $ 11,048,394 -- $ --
Dividends and distributions
reinvested 4,391 121,221 -- --
Redeemed (72,353) (1,969,658) -- --
---------- ------------ ---------- ------------
Net increase 330,820 $ 9,199,957 -- $ --
========== ============ ========== ============
-------------------------------------------------------------------------------------------------
Class Y
Sold 356 $ 10,000 -- $ --
========== ============ ========== ============
</TABLE>
(1) For the year ended June 30, 1994 for Class A
shares, for the period from August 17, 1993
(inception of offering) to June 30, 1994 for
Class B shares, and for the period from June 1,
1994 (inception of offering) to June 30, 1994 for
Class Y shares.
===============================================================================
3. UNREALIZED GAINS AND
LOSSES ON INVESTMENTS At June 30, 1994, net unrealized appreciation on
investments of $163,966,802 was composed of gross
appreciation of $195,419,407, and gross
depreciation of $31,452,605.
===============================================================================
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 $200 million of net assets with
a reduction of .03% on each $200 million
thereafter to $800 million, and .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, 1994,
commissions (sales charges paid by investors) on
sales of Class A shares totaled $1,831,787, of
which $495,180 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 $22,883 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, Class A
and Class B may expend up to .25% of 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 $23,576 to an affiliated
broker/dealer as reimbursement for Class A
personal service and maintenance expenses and
retained $44,228 as reimbursement for Class B
sales commissions and service fee advances, as
well as financing costs.
15 Oppenheimer Special Fund
<PAGE> 16
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders of Oppenheimer Special Fund:
We have audited the accompanying statements of investments and assets and
liabilities of Oppenheimer Special Fund as of June 30, 1994, 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 ten-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 and financial highlights. Our procedures included confirmation of
securities owned as of June 30, 1994, 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 Special Fund as of June 30, 1994, 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 ten-year period then ended, in conformity with
generally accepted accounting principles.
KPMG PEAT MARWICK LLP
Denver, Colorado
July 22, 1994
16 Oppenheimer Special Fund
<PAGE> 17
FEDERAL INCOME TAX INFORMATION (Unaudited)
In early 1995, shareholders will receive information regarding all dividends
and distributions paid to them by the Fund during the 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 $.639 per share was paid on December 18, 1993 which
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 gains distributions should be multiplied by
100% 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.
17 Oppenheimer Special Fund
<PAGE> 18
OPPENHEIMER SPECIAL FUND
<TABLE>
<S> <C>
================================================================================================================================
OFFICERS AND TRUSTEES Leon Levy, Chairman of the Board of Trustees
Leo Cherne, Trustee
Edmund T. Delaney, Trustee
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
Donald W. Spiro, Trustee and President
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Robert C. Doll, Jr., Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
===============================================================================================================================
INVESTMENT ADVISOR Oppenheimer Management Corporation
===============================================================================================================================
DISTRIBUTOR Oppenheimer Funds Distributor, Inc.
===============================================================================================================================
TRANSFER AND SHAREHOLDER Oppenheimer Shareholder Services
SERVICING AGENT
===============================================================================================================================
CUSTODIAN OF The Bank of New York
PORTFOLIO SECURITIES
===============================================================================================================================
INDEPENDENT AUDITORS KPMG Peat Marwick LLP
===============================================================================================================================
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
</TABLE>
This is a copy of a report to shareholders of
Oppenheimer Special Fund. This report must be
preceded or accompanied by a Prospectus of
Oppenheimer Special Fund. For material
information concerning the Fund, see the
Prospectus.
18 Oppenheimer Special Fund
<PAGE> 19
THE FAMILY OF OPPENHEIMERFUNDS
===============================================================================
OppenheimerFunds offers over 30 mutual funds
designed to fit virtually every investment goal.
Whether you're investing for retirement, your
children's education, or tax-free income, we have
the mutual funds to help you seek your objective.
When you invest with OppenheimerFunds,
you can feel comfortable knowing that you are
investing with a respected financial institution
with over 30 years of experience in helping
people just like you reach their financial goals.
And you're investing with a leader in global,
growth stock, and flexible fixed income
investments--with over 1.8 million shareholder
accounts and more than $26 billion under
Oppenheimer's management and that of our
affiliates.
As an OppenheimerFunds shareholder, you
can easily exchange sales of eligible funds of
the same class by mail or by telephone for a
small administrative fee.(1) For more
information on OppenheimerFunds, please contact
your financial advisor or call us at
1-800-525-7048 for a prospectus. You may also
write us at the address shown on the back cover.
As always, please read the prospectus carefully
before you invest.
<TABLE>
<S> <C> <C>
==============================================================================================================================
SPECIALTY STOCK FUND Gold & Special Minerals Fund
==============================================================================================================================
STOCK FUNDS Discovery Fund Global Fund
Time Fund Oppenheimer Fund
Target Fund Value Stock Fund
Special Fund
==============================================================================================================================
STOCK AND BOND FUNDS Main Street Income & Growth Fund Equity Income Fund
Total Return Fund Asset Allocation Fund
Global Growth &Income Fund
==============================================================================================================================
BOND FUNDS High Yield Fund Strategic Short-Term Income Fund
Champion High Yield Fund Investment Grade Bond Fund
Strategic Income & Growth Fund Mortgage Income Fund
Strategic Income Fund U.S. Government Trust
Strategic Diversified Income Fund Limited-Term Government Fund(2)
Strategic Investment Grade Bond Fund
==============================================================================================================================
TAX-EXEMPT FUNDS New York Tax-Exempt Fund(3) New Jersey Tax-Exempt Fund(3)
California Tax-Exempt Fund(3) Tax-Free Bond Fund
Pennsylvania Tax-Exempt Fund(3) Insured Tax-Exempt Bond Fund
Florida Tax-Exempt Fund(3) Intermediate Tax-Exempt Bond Fund
==============================================================================================================================
MONEY MARKET FUNDS Money Market Fund Cash Reserves
</TABLE>
(1) The fee is waived for PhoneLink exchanges between existing accounts.
Exchange privileges are subject to change or termination.
(2) Formerly Government Securities Fund.
(3) Available only to residents of those states.
OppenheimerFunds are distributed by Oppenheimer Funds Distributor, Inc., Two
World Trade Center, New York, NY10048-0203.
(C) Copyright 1994 Oppenheimer Management Corporation. All rights reserved.
19 Oppenheimer Special Fund
<PAGE> 20
"HOW MAY I HELP YOU?"
[PHOTO -- SEE EDGAR APPENDIX]
"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 account transactions, it's easy for
you to redeem shares, exchange shares, or conduct AccountLink transactions,
simply by calling our Telephone Transactions number.
"And for added convenience, OppenheimerFunds' PhoneLink,
an automated voice 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."
(1993 AWARD OF EXCELLENCE INTERNATIONAL CUSTOMER SERVICE ASSOCIATION LOGO)
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.
RA220.0794.N
(OPPENHEIMERFUNDS(R) LOGO)
Oppenheimer Funds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
- ---------------
Bulk Rate
U.S. Postage
PAID
Permit No. 314
Farmingdale, NY
- ---------------
<PAGE> 21
APPENDIX TO ELECTRONIC FORMAT DOCUMENT
The back cover of the report in the printed version contains a photo of
Barbara Hennigar, Chief Executive Officer, Oppenheimer Shareholder Services.
