OPPENHEIMER VARIABLE ACCOUNT FUNDS
Supplement Dated March 16, 1998
to the Prospectus dated May 1, 1997
The Prospectus is amended as follows:
1. The supplements to the Prospectus dated January 1, 1998 and
February 27, 1998 are
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 by deleting Capital Appreciation Fund and
adding the following:
High Income Fund, Thomas P. Reedy;
Capital Appreciation Fund, Jay W. Tracey, III
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 are 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)
<PAGE>
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 fifth paragraph in the section captioned "How The Funds Are Managed
- - Portfolio
Managers" is replaced by the following:
The portfolio manager of Capital Appreciation Fund is Jay W. Tracey, III.
He has been the person principally responsible for the day-to-day management of
that Fund's portfolio since March, 1998, and has served as a portfolio manager
and officer of other Oppenheimer funds. During the past five years, Mr. Tracey
formerly served as a managing director of Buckingham Capital Management, prior
to which he was, and now is, a portfolio manager and Vice President of other
Oppenheimer funds and a Vice President of the Manager.
6. The last paragraph in the section captioned "How the Funds are Managed
- - Portfolio
Managers" is replaced by the following:
Messrs. Milnamow, Negri, Reedy and Tracey, 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.
March 16, 1998 PS0600.010.0298
<PAGE>
OPPENHEIMER VARIABLE ACCOUNT FUNDS
Supplement dated March 16, 1998 to the Statement of
Additional Information dated May 1, 1997
The supplement to the Statement of Additional Information dated January 1, 1998
is replaced by this supplement. The Statement of Additional Information is
amended as follows:
1. The listing for Paul LaRocco on page 23 is replaced with the following:
Jay W. Tracey III, Vice President; Capital Appreciation Fund Portfolio
Manager; Age: 44
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager (since September 1994); Vice President and
portfolio manager of other OppenheimerFunds; formerly a Managing Director of
Buckingham Capital Management (February 1994-September 1994), prior to which he
was Vice President and portfolio manager of other Oppenheimer funds and a Vice
President of the Manager (July 1991-February 1994).
2. The listing for David P. Negri on page 23 is replaced with the following:
David P. Negri, Vice President; Bond Fund, Multiple Strategies Fund and
Strategic Bond Fund
Portfolio Manager; Age: 43
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager; Vice President and portfolio manager of other
Oppenheimer funds.
Thomas P. Reedy, Vice President; High Income Fund Portfolio Manager; Age 35 Two
World Trade Center, New York, New York 10048-0203 Vice President of the Manager
(since June 1993); Vice President and portfolio manager of other Oppenheimer
funds; formerly a Securities Analyst for the Manager.
March 16, 1998 PX0600.006
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