OPPENHEIMER VARIABLE ACCOUNT FUNDS
Supplement Dated February 27, 1998
to the Prospectus dated May 1, 1997
The Prospectus is amended as follows:
1. The supplement to the Prospectus dated January 1, 1998 is replaced by
this supplement.
2. The third sentence under the caption "Overview of the Funds - Who
Manages the Funds?" is revised by deleting High Income Fund from the list of
funds managed by David Negri and adding
the following:
High Income Fund, Thomas P. Reedy;
3. The following is added as a final paragraph under "Can the Funds'
Investment Objectives
Policies Change?"
Anticipated Change in Bond Fund. The Trust's Board of Trustees has
determined that it would be in the best interests of the shareholders of Bond
Fund to change that Fund's current investment policies with respect to
investment in investment grade bonds. Details about this proposal will be
contained in a proxy statement sent to the Fund's shareholders of record on
February 6, 1998, the record date for the shareholder meeting to vote on this
and other proposals to change other investment policies. There can be no
assurance that shareholders will approve this proposal. Only Bond Fund
shareholders are affected by, and vote on, this proposal.
If the shareholders approve this proposal, Bond Fund's primary investment
objective would change, effective May 1, 1998, to: "to seek a high level of
current income". Its secondary objective would remain "to seek capital growth
when consistent with its primary objective." In addition, Bond Fund would be
permitted to invest up to 35% of its total assets in debt securities rated less
than investment grade, when consistent with Bond Fund's investment objectives,
as revised. Under normal market conditions, Bond Fund would invest at least 65%
of its total assets in investment grade debt securities, U.S. government
securities and money market instruments. Investment grade debt securities would
include those rated in one of the four highest ranking categories by any
nationally-recognized rating organization or if unrated or split-rated (rated
investment grade and below investment grade by different rating organizations),
determined by the Fund's investment adviser, OppenheimerFunds, Inc., to be of
comparable quality.
(continued)
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There is an increased credit risk that issuers of non-investment grade
debt securities, often referred to as "junk bonds", may not be able to make
interest or principal payments as they become due. For further details, see
Proposal No. 3 in the proxy statement (a copy of which may be obtained by
calling 1-800-525-7048) and "High Yield Securities" in Oppenheimer Variable
Account Fund's prospectus.
4. The first paragraph in the section captioned "How the Funds are Managed
- - Portfolio Managers" is revised by deleting all references to High Income Fund
and by adding the following
after the sixth paragraph under that caption:
The Portfolio Manager of High Income Fund is Thomas P. Reedy. He is the person
principally responsible for the day-to-day management of that Fund since January
1, 1998.
During the past five years Mr. Reedy has served as a portfolio manager and
officer of other Oppenheimer funds and formerly served as a Securities Analyst
for OFI (the "Manager").
5. The last paragraph in the section captioned "How the Funds are Managed -
Portfolio Managers" is replaced by the following:
Messrs. LaRocco, Milnamow, Negri and Reedy, Ms. Putnam and Ms. Warmack are Vice
Presidents of the Manager, Mr. Levine is an Assistant Vice President of the
Manager, and Messrs. Rubinstein, Steinmetz and Wilby are Senior Vice Presidents
of the Manager. Each of the Portfolio Managers named above is also a Vice
President of the Trust.
February 27, 1998 PS0600.009.0298
