Semiannual Report June 30, 2000
Oppenheimer
Main Street(R) Growth &
Income Fund/VA
A Series of Oppenheimer Variable Account Funds
[logo]OppenheimerFunds(R)
The Right Way to Invest
<PAGE>
Oppenheimer Variable Account Funds--Oppenheimer Main Street(R) Growth & Income
Fund/VA
================================================================================
Objective
Oppenheimer Main Street Growth & Income Fund/VA, a series of Oppenheimer
Variable Account Funds, seeks high total return, which includes growth in the
value of its shares, as well as current income from equity and debt securities.
================================================================================
Narrative by Charles Albers and Nikolaos Monoyios, Co-portfolio Managers
For the six-month period ended June 30, 2000, Oppenheimer Main Street Growth &
Income Fund/VA provided a cumulative total return of 0.19%.(1)
Equity markets demonstrated considerable volatility during the period.
Growth-oriented stocks rose sharply during January and February 2000, supported
by continued expansion of the U.S. economy, low rates of inflation, growing
evidence of global economic recovery and diminishing fears of Y2K-related
problems. Because our analysis indicated that growth stocks were significantly
overpriced, we maintained a slight tilt toward value in the Fund, as compared to
the S&P 500 Index.
Our disciplined approach paid off in March 2000, when uncertainties
associated with rising interest rates led to a sharp downward correction in
growth-oriented stocks. In May 2000, as growth stocks became more reasonably
priced, we began shifting some of the Fund's assets from the value sector to the
growth sector, taking advantage of attractive opportunities among fast-growing
technology companies.
Our quantitative models--which evaluate characteristics of market
sectors, as well as individual stocks--guided us to position the Fund
effectively in a wide range of industries. In particular, we emphasized
energy-related stocks, many of which performed strongly due to steadily rising
prices for oil and gas, and consolidations among several of the industry's key
players. Our decision to reduce the Fund's position in the consumer-staples
sector also proved beneficial to the Fund's performance. In the consumer-staples
sector, food and beverage companies suffered from weak global sales.
On the other hand, we were disappointed by the performance of the
Fund's consumer cyclicals, as auto and retailing companies struggled to maintain
earnings growth. We began reducing our exposure to this sector during the
reporting period.
Looking ahead, we believe economic fundamentals remain in place to
support continued growth in the equities markets. As of the end of the reporting
period, we continue to focus on large-cap stocks, which have generally
outperformed smaller company stocks for the last decade. Our investment model is
beginning to point to growing opportunities among technology-oriented stocks, as
prices fall to levels we consider reasonable. We have also begun to observe
attractive opportunities among consumer-staples companies, which seem to have
rebounded from their previous weak sales. We believe that many of these
companies are now well positioned to benefit from strengthening global sales.
Our investment discipline is designed to highlight just such opportunities
before they are fully appreciated by the rest of the investment community.
Because the stock market can be volatile, the Fund's performance may be subject
to substantial short-term changes.
1.Includes changes in net asset value per share and does not include the charges
associated with the separate account products which offer this Fund. Such
performance is not annualized and would have been lower if such charges were
taken into account.
2 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Oppenheimer Variable Account Funds--Oppenheimer Main Street(R) Growth & Income
Fund/VA
================================================================================
Whatever direction the markets take in the coming months and years, we remain
confident that our disciplined investment approach will lead us in the right
direction. While this is our second year as managers of Oppenheimer Main Street
Growth & Income Fund/VA, we have been employing similar quantitative models for
more than 25 years across a wide range of market cycles and conditions. In the
process, we have conducted numerous research studies to validate and refine our
approach. Equally important are our many years of experience in gauging the
behavior of our models under a variety of economic environments and translating
the data we receive into portfolios that accurately reflect evolving, real-world
market conditions.
We believe our disciplined, fact-based approach enables us to reduce
investment risks while positioning the Fund to perform strongly. Rather than
relying on intuition or forecasts, we remain guided by the hard data provided by
our quantitative models. This information enables us to position the Fund at the
forefront of changing market conditions, and makes Oppenheimer Main Street
Growth & Income Fund/VA an important part of The Right Way to Invest.
Oppenheimer Main Street Growth & Income Fund/VA 3
<PAGE>
Statement of Investments June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Market Value
Shares Note 1
==========================================================================================
<S> <C> <C>
Common Stocks--94.9%
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Basic Materials--2.5%
------------------------------------------------------------------------------------------
Chemicals--1.4%
Dexter Corp. 6,000 $ 288,000
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Dow Chemical Co. 95,700 2,888,944
------------------------------------------------------------------------------------------
Du Pont (E.I.) de Nemours & Co. 125,800 5,503,750
------------------------------------------------------------------------------------------
Ecolab, Inc. 6,900 269,531
------------------------------------------------------------------------------------------
Engelhard Corp. 6,300 107,494
------------------------------------------------------------------------------------------
Lafarge Corp. 8,100 170,100
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PPG Industries, Inc. 14,400 638,100
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Rohm & Haas Co. 26,900 928,050
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Union Carbide Corp. 20,500 1,014,750
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Universal Corp. 5,000 105,625
-----------
11,914,344
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Metals--0.8%
AK Steel Holding Corp. 10,000 80,000
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Alcan Aluminium Ltd. 40,000 1,240,000
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Alcan Aluminium Ltd. 3,800 117,973
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Alcoa, Inc. 149,600 4,338,400
------------------------------------------------------------------------------------------
Inco Ltd.(1) 32,900 505,837
------------------------------------------------------------------------------------------
Nucor Corp. 4,900 162,619
------------------------------------------------------------------------------------------
Reliance Steel & Aluminum Co. 15,000 286,875
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Ryerson Tull, Inc. 13,000 134,875
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Worthington Industries, Inc. 3,600 37,800
-----------
6,904,379
------------------------------------------------------------------------------------------
Paper--0.3%
Pactiv Corp.(1) 17,000 133,875
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Rayonier, Inc. 20,000 717,500
------------------------------------------------------------------------------------------
Westvaco Corp. 3,000 74,437
------------------------------------------------------------------------------------------
Weyerhaeuser Co. 36,300 1,560,900
------------------------------------------------------------------------------------------
Willamette Industries, Inc. 11,700 318,825
-----------
2,805,537
------------------------------------------------------------------------------------------
Capital Goods--10.2%
------------------------------------------------------------------------------------------
Aerospace/Defense--0.9%
Boeing Co. 172,000 7,191,750
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General Dynamics Corp. 5,400 282,150
------------------------------------------------------------------------------------------
L-3 Communications Holdings, Inc.(1) 2,000 114,125
------------------------------------------------------------------------------------------
Northrop Grumman Corp. 2,500 165,625
-----------
7,753,650
4 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
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Electrical Equipment--5.8%
AVX Corp. 44,800 $ 1,027,600
------------------------------------------------------------------------------------------
CommScope, Inc.(1) 12,000 492,000
------------------------------------------------------------------------------------------
Conexant Systems, Inc.(1) 22,900 1,113,512
------------------------------------------------------------------------------------------
Emerson Electric Co. 31,100 1,877,662
------------------------------------------------------------------------------------------
General Electric Co. 695,300 36,850,900
------------------------------------------------------------------------------------------
Integrated Device Technology, Inc.(1) 27,800 1,664,525
------------------------------------------------------------------------------------------
Molex, Inc., Cl. A 24,950 873,250
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Rockwell International Corp. 30,600 963,900
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SPX Corp.(1) 11,800 1,427,062
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Symbol Technologies, Inc.(1) 11,025 595,350
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Vishay Intertechnology, Inc.(1) 28,000 1,062,250
-----------
47,948,011
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Industrial Services--0.2%
Fluor Corp. 2,500 79,062
------------------------------------------------------------------------------------------
Paychex, Inc. 30,750 1,291,500
------------------------------------------------------------------------------------------
Valassis Communications, Inc.(1) 10,000 381,250
-----------
1,751,812
------------------------------------------------------------------------------------------
Manufacturing--3.3%
American Standard Cos., Inc.(1) 75,000 3,075,000
------------------------------------------------------------------------------------------
Avery-Dennison Corp. 36,400 2,443,350
------------------------------------------------------------------------------------------
Ball Corp. 1,200 38,625
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Bemis Co., Inc. 4,700 158,037
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Caterpillar, Inc. 7,700 260,837
------------------------------------------------------------------------------------------
Cooper Industries, Inc. 13,900 452,619
------------------------------------------------------------------------------------------
Corning, Inc. 20,500 5,532,437
------------------------------------------------------------------------------------------
Cummins Engine Co., Inc. 2,400 65,400
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Dover Corp. 40,100 1,626,556
------------------------------------------------------------------------------------------
Eaton Corp. 7,400 495,800
------------------------------------------------------------------------------------------
Energizer Holdings, Inc.(1) 4,000 73,000
------------------------------------------------------------------------------------------
Honeywell International, Inc. 99,775 3,361,170
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Illinois Tool Works, Inc. 15,100 860,700
------------------------------------------------------------------------------------------
Kulicke & Soffa Industries, Inc.(1) 1,000 59,375
------------------------------------------------------------------------------------------
Mark IV Industries, Inc. 15,000 313,125
------------------------------------------------------------------------------------------
Mettler-Toledo International, Inc.(1) 6,000 240,000
------------------------------------------------------------------------------------------
Microchip Technology, Inc.(1) 4,500 262,195
------------------------------------------------------------------------------------------
Miller (Herman), Inc. 10,000 258,750
------------------------------------------------------------------------------------------
Minnesota Mining & Manufacturing Co. 83,500 6,888,750
------------------------------------------------------------------------------------------
PACCAR, Inc. 3,800 150,812
------------------------------------------------------------------------------------------
Parker-Hannifin Corp. 12,100 414,425
-----------
27,030,963
Oppenheimer Main Street Growth & Income Fund/VA 5
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Communication Services--3.1%
------------------------------------------------------------------------------------------
Telecommunications: Long Distance--0.6%
ALLTEL Corp. 12,100 $ 749,444
------------------------------------------------------------------------------------------
Brocade Communications Systems, Inc.(1) 5,400 990,816
------------------------------------------------------------------------------------------
Comverse Technology, Inc.(1) 8,800 818,400
------------------------------------------------------------------------------------------
Intermedia Communications, Inc.(1)(2) 1,230 34,763
------------------------------------------------------------------------------------------
Sprint Corp. (Fon Group) 50,000 2,550,000
-----------
5,143,423
------------------------------------------------------------------------------------------
Telephone Utilities--2.4%
Bell Atlantic Corp. 146,000 7,418,625
------------------------------------------------------------------------------------------
BellSouth Corp. 256,000 10,912,000
------------------------------------------------------------------------------------------
GTE Corp. 29,800 1,855,050
-----------
20,185,675
------------------------------------------------------------------------------------------
Telecommunications: Wireless--0.1%
Amdocs Ltd.(1) 9,000 690,750
------------------------------------------------------------------------------------------
Consumer Cyclicals--10.9%
------------------------------------------------------------------------------------------
Autos & Housing--0.9%
Arvin Industries, Inc. 6,900 119,887
------------------------------------------------------------------------------------------
Bandag, Inc. 2,000 48,500
------------------------------------------------------------------------------------------
Centex Construction Products, Inc. 6,000 136,125
------------------------------------------------------------------------------------------
Delphi Automotive Systems Corp. 50,831 740,226
------------------------------------------------------------------------------------------
Fortune Brands, Inc. 10,800 249,075
------------------------------------------------------------------------------------------
General Motors Corp. 50,164 2,912,647
------------------------------------------------------------------------------------------
Johnson Controls, Inc. 6,700 343,794
------------------------------------------------------------------------------------------
Lear Corp.(1) 17,500 350,000
------------------------------------------------------------------------------------------
Meritor Automotive, Inc. 12,000 132,000
------------------------------------------------------------------------------------------
NVR, Inc.(1) 5,800 330,600
------------------------------------------------------------------------------------------
Ryland Group, Inc. (The) 7,000 154,875
------------------------------------------------------------------------------------------
Southdown, Inc. 7,000 404,250
------------------------------------------------------------------------------------------
Toll Brothers, Inc.(1) 10,000 205,000
------------------------------------------------------------------------------------------
Tower Automotive, Inc.(1) 8,900 111,250
------------------------------------------------------------------------------------------
Vulcan Materials Co. 8,000 341,500
------------------------------------------------------------------------------------------
Webb (Del E.) Corp.(1) 4,300 65,844
------------------------------------------------------------------------------------------
Whirlpool Corp. 12,700 592,137
-----------
7,237,710
------------------------------------------------------------------------------------------
Consumer Services--0.3%
Avis Group Holdings, Inc.(1) 18,000 337,500
------------------------------------------------------------------------------------------
Dun & Bradstreet Corp. 2,500 71,562
------------------------------------------------------------------------------------------
Harte-Hanks, Inc. 11,000 275,000
------------------------------------------------------------------------------------------
Interpublic Group of Cos., Inc. 12,900 554,700
------------------------------------------------------------------------------------------
Omnicom Group, Inc. 13,700 1,220,156
------------------------------------------------------------------------------------------
Young & Rubicam, Inc. 3,900 223,031
-----------
2,681,949
6 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Leisure & Entertainment--0.4%
Brunswick Corp. 32,800 $ 543,250
------------------------------------------------------------------------------------------
Harley-Davidson, Inc. 18,200 700,700
------------------------------------------------------------------------------------------
Marriott International, Inc., Cl. A 6,700 241,619
------------------------------------------------------------------------------------------
MGM Grand, Inc. 30,648 984,567
------------------------------------------------------------------------------------------
Park Place Entertainment Corp.(1) 90,000 1,096,875
-----------
3,567,011
------------------------------------------------------------------------------------------
Media--2.2%
Deluxe Corp. 2,200 51,837
------------------------------------------------------------------------------------------
Dow Jones & Co., Inc. 15,400 1,128,050
------------------------------------------------------------------------------------------
Gannett Co., Inc. 50,000 2,990,625
------------------------------------------------------------------------------------------
Harland (John H.) Co. 10,000 149,375
------------------------------------------------------------------------------------------
Knight-Ridder, Inc. 14,800 787,175
------------------------------------------------------------------------------------------
McClatchy Co., Cl. A 3,600 119,250
------------------------------------------------------------------------------------------
McGraw-Hill, Inc. 19,000 1,026,000
------------------------------------------------------------------------------------------
New York Times Co., Cl. A 48,000 1,896,000
------------------------------------------------------------------------------------------
R.H. Donnelley Corp. 9,900 191,812
------------------------------------------------------------------------------------------
Readers Digest Assn., Inc., Cl. A, Non-Vtg. 38,300 1,522,425
------------------------------------------------------------------------------------------
Snyder Communications, Inc.(1) 5,000 118,750
------------------------------------------------------------------------------------------
Time Warner, Inc. 75,000 5,700,000
------------------------------------------------------------------------------------------
Tribune Co. 22,100 773,500
------------------------------------------------------------------------------------------
USA Networks, Inc.(1) 73,700 1,593,762
-----------
18,048,561
------------------------------------------------------------------------------------------
Retail: General--3.9%
Dollar General Corp. 5,400 105,300
------------------------------------------------------------------------------------------
Federated Department Stores, Inc.(1) 47,800 1,613,250
------------------------------------------------------------------------------------------
May Department Stores Co. 36,500 876,000
------------------------------------------------------------------------------------------
Sears Roebuck & Co. 4,600 150,075
------------------------------------------------------------------------------------------
Wal-Mart Stores, Inc. 506,000 29,158,250
-----------
31,902,875
------------------------------------------------------------------------------------------
Retail: Specialty--2.9%
Ann Taylor Stores Corp.(1) 8,000 265,000
------------------------------------------------------------------------------------------
Best Buy Co., Inc.(1) 35,000 2,213,750
------------------------------------------------------------------------------------------
BJ's Wholesale Club, Inc.(1) 10,800 356,400
------------------------------------------------------------------------------------------
Circuit City Stores-Circuit City Group 7,300 242,269
------------------------------------------------------------------------------------------
Gap, Inc. 30,700 959,375
------------------------------------------------------------------------------------------
Home Depot, Inc. 283,300 14,147,294
------------------------------------------------------------------------------------------
Limited, Inc. 79,900 1,727,837
------------------------------------------------------------------------------------------
Payless ShoeSource, Inc.(1) 350 17,937
------------------------------------------------------------------------------------------
RadioShack Corp. 11,000 521,125
------------------------------------------------------------------------------------------
Ross Stores, Inc. 43,000 733,687
------------------------------------------------------------------------------------------
Target Corp. 12,000 696,000
------------------------------------------------------------------------------------------
Tiffany & Co. 16,900 1,140,750
------------------------------------------------------------------------------------------
Zale Corp.(1) 18,000 657,000
-----------
23,678,424
Oppenheimer Main Street Growth & Income Fund/VA 7
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Textile/Apparel & Home Furnishings--0.3%
Jones Apparel Group, Inc.(1) 65,099 $1,529,826
------------------------------------------------------------------------------------------
Linens 'N Things, Inc.(1) 5,000 135,625
------------------------------------------------------------------------------------------
Liz Claiborne, Inc. 14,000 493,500
------------------------------------------------------------------------------------------
Mohawk Industries, Inc.(1) 7,900 171,825
------------------------------------------------------------------------------------------
Too, Inc.(1) 2,957 75,219
------------------------------------------------------------------------------------------
VF Corp. 4,800 114,300
------------------------------------------------------------------------------------------
WestPoint Stevens, Inc. 10,100 112,362
----------
2,632,657
------------------------------------------------------------------------------------------
Consumer Staples--4.1%
------------------------------------------------------------------------------------------
Beverages--0.7%
Adolph Coors Co., Cl. B 3,500 211,750
------------------------------------------------------------------------------------------
Anheuser-Busch Cos., Inc. 67,000 5,004,062
------------------------------------------------------------------------------------------
Brown-Forman Corp., Cl. B 700 37,625
------------------------------------------------------------------------------------------
Canandaigua Brands, Inc., Cl. A(1) 2,700 136,181
------------------------------------------------------------------------------------------
Seagram Co. Ltd. (The) 4,100 237,800
----------
5,627,418
------------------------------------------------------------------------------------------
Broadcasting--0.8%
AT&T--Liberty Media Group, Series A(1) 54,000 1,309,500
------------------------------------------------------------------------------------------
Comcast Corp., Cl. A Special(1) 67,800 2,745,900
------------------------------------------------------------------------------------------
Cox Communications, Inc., Cl. A(1) 10,000 455,625
------------------------------------------------------------------------------------------
Infinity Broadcasting Corp., Cl. A(1) 8,000 291,500
------------------------------------------------------------------------------------------
MediaOne Group, Inc.(1) 21,000 1,392,589
------------------------------------------------------------------------------------------
ValueVision International, Inc., Cl. A(1) 2,900 69,600
----------
6,264,714
------------------------------------------------------------------------------------------
Entertainment--1.0%
Brinker International, Inc.(1) 18,000 526,500
------------------------------------------------------------------------------------------
Darden Restaurants, Inc. 14,600 237,250
------------------------------------------------------------------------------------------
Disney (Walt) Co. 80,400 3,120,525
------------------------------------------------------------------------------------------
Ruby Tuesday, Inc. 20,000 251,250
------------------------------------------------------------------------------------------
Viacom, Inc., Cl. B(1) 62,930 4,291,039
------------------------------------------------------------------------------------------
Wendy's International, Inc. 14,000 249,375
----------
8,675,939
------------------------------------------------------------------------------------------
Food--0.4%
Agribrands International, Inc.(1) 10,000 419,375
------------------------------------------------------------------------------------------
ConAgra, Inc. 8,400 160,125
------------------------------------------------------------------------------------------
Hormel Foods Corp. 3,500 58,844
------------------------------------------------------------------------------------------
Ralston Purina Co. 12,000 239,250
------------------------------------------------------------------------------------------
Sysco Corp. 48,800 2,055,700
----------
2,933,294
------------------------------------------------------------------------------------------
Food & Drug Retailers--0.2%
Walgreen Co. 49,800 1,602,937
8 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Household Goods--0.8%
Colgate-Palmolive Co. 22,000 $ 1,317,250
------------------------------------------------------------------------------------------
Kimberly-Clark Corp. 96,500 5,536,687
-----------
6,853,937
------------------------------------------------------------------------------------------
Tobacco--0.2%
R.J. Reynolds Tobacco Holdings, Inc. 57,400 1,603,612
------------------------------------------------------------------------------------------
Energy--15.0%
------------------------------------------------------------------------------------------
Energy Services--3.6%
BJ Services Co.(1) 15,000 937,500
------------------------------------------------------------------------------------------
Cabot Oil & Gas Corp., Cl. A 21,000 444,937
------------------------------------------------------------------------------------------
Coastal Corp. 8,600 523,525
------------------------------------------------------------------------------------------
Constellation Energy Group, Inc. 7,500 244,219
------------------------------------------------------------------------------------------
Cooper Cameron Corp.(1) 60,000 3,960,000
------------------------------------------------------------------------------------------
Dominion Resources, Inc. 17,100 733,162
------------------------------------------------------------------------------------------
Dynegy, Inc. 22,600 1,543,862
------------------------------------------------------------------------------------------
ENSCO International, Inc. 119,000 4,261,687
------------------------------------------------------------------------------------------
Global Marine, Inc.(1) 188,500 5,313,344
------------------------------------------------------------------------------------------
Nabors Industries, Inc.(1) 60,000 2,493,750
------------------------------------------------------------------------------------------
Noble Drilling Corp.(1) 60,000 2,471,250
------------------------------------------------------------------------------------------
Renaissance Energy Ltd.(1) 3,300 31,960
------------------------------------------------------------------------------------------
Rowan Cos., Inc.(1) 8,400 255,150
------------------------------------------------------------------------------------------
Santa Fe International Corp. 84,000 2,934,750
------------------------------------------------------------------------------------------
Stolt Offshore SA, ADR(1) 315,000 3,740,625
-----------
29,889,721
------------------------------------------------------------------------------------------
Oil: Domestic--7.4%
Amerada Hess Corp. 21,700 1,339,975
------------------------------------------------------------------------------------------
Chevron Corp. 100,500 8,523,656
------------------------------------------------------------------------------------------
Chieftain International, Inc.(1) 53,600 1,021,750
------------------------------------------------------------------------------------------
Conoco, Inc., Cl. B 24,500 601,781
------------------------------------------------------------------------------------------
Devon Energy Corp. 40,000 2,247,500
------------------------------------------------------------------------------------------
EOG Resources, Inc. 69,200 2,318,200
------------------------------------------------------------------------------------------
Exxon Mobil Corp. 299,988 23,549,058
------------------------------------------------------------------------------------------
Frontier Oil Corp.(1) 61,300 490,400
------------------------------------------------------------------------------------------
Genesis Exploration Ltd.(1) 242,000 1,796,585
------------------------------------------------------------------------------------------
Kerr-McGee Corp. 27,800 1,638,462
------------------------------------------------------------------------------------------
Murphy Oil Corp. 50,900 3,025,369
------------------------------------------------------------------------------------------
Newfield Exploration Co.(1) 26,100 1,021,162
------------------------------------------------------------------------------------------
Noble Affiliates, Inc. 8,000 298,000
------------------------------------------------------------------------------------------
Occidental Petroleum Corp. 30,500 642,406
------------------------------------------------------------------------------------------
Phillips Petroleum Co. 35,000 1,774,063
------------------------------------------------------------------------------------------
Stone Energy Corp.(1) 14,400 860,400
------------------------------------------------------------------------------------------
Tesoro Petroleum Corp.(1) 34,000 344,250
------------------------------------------------------------------------------------------
Texaco, Inc. 72,500 3,860,625
Oppenheimer Main Street Growth & Income Fund/VA 9
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Oil: Domestic (continued)
Tosco Corp. 29,000 $ 821,063
------------------------------------------------------------------------------------------
Union Pacific Resources Group, Inc. 6,000 132,000
------------------------------------------------------------------------------------------
USX-Marathon Group 4,000 100,250
------------------------------------------------------------------------------------------
Vastar Resources, Inc. 60,000 4,927,500
-----------
61,334,455
------------------------------------------------------------------------------------------
Oil: International--4.0%
Anderson Exploration Ltd.(1) 157,679 2,862,634
------------------------------------------------------------------------------------------
Beau Canada Exploration Ltd.(1) 308,600 337,404
------------------------------------------------------------------------------------------
Berkley Petroleum Corp.(1) 179,700 1,133,964
------------------------------------------------------------------------------------------
Canadian 88 Energy Corp. 300,000 617,534
------------------------------------------------------------------------------------------
Canadian Hunter Exploration Ltd.(1) 24,400 517,905
------------------------------------------------------------------------------------------
Canadian Hunter Exploration Ltd.(1) 78,500 1,666,211
------------------------------------------------------------------------------------------
Canadian Natural Resources Ltd.(1) 120,000 3,482,486
------------------------------------------------------------------------------------------
Encal Energy Ltd.(1) 70,000 444,085
------------------------------------------------------------------------------------------
Paramount Resources Ltd. 58,900 602,237
------------------------------------------------------------------------------------------
Ranger Oil Ltd.(1) 85,300 454,795
------------------------------------------------------------------------------------------
Rio Alto Exploration Ltd.(1) 54,150 990,393
------------------------------------------------------------------------------------------
Royal Dutch Petroleum Co., NY Shares 283,100 17,428,344
------------------------------------------------------------------------------------------
Talisman Energy, Inc.(1) 67,000 2,217,959
-----------
32,755,951
------------------------------------------------------------------------------------------
Financial--7.8%
------------------------------------------------------------------------------------------
Banks--0.8%
BB&T Corp. 5,600 133,700
------------------------------------------------------------------------------------------
Mellon Financial Corp. 13,000 473,688
------------------------------------------------------------------------------------------
National City Corp. 3,400 58,013
------------------------------------------------------------------------------------------
Northern Trust Corp. 4,000 260,250
------------------------------------------------------------------------------------------
Old Kent Financial Corp. 14,385 384,799
------------------------------------------------------------------------------------------
PNC Financial Services Group 19,700 923,438
------------------------------------------------------------------------------------------
Prosperity Bancshares, Inc. 67,500 1,088,438
------------------------------------------------------------------------------------------
Wachovia Corp. 5,100 276,675
------------------------------------------------------------------------------------------
Wells Fargo Co. 82,500 3,196,875
-----------
6,795,876
------------------------------------------------------------------------------------------
Diversified Financial--5.0%
Bear Stearns Cos., Inc. 6,600 274,725
------------------------------------------------------------------------------------------
Citigroup, Inc. 370,400 22,316,600
------------------------------------------------------------------------------------------
Fannie Mae 20,000 1,043,750
------------------------------------------------------------------------------------------
Financial Security Assurance Holdings Ltd. 7,000 531,125
------------------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The) 28,700 2,722,913
------------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc. 22,000 2,080,375
------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc. 19,000 2,185,000
------------------------------------------------------------------------------------------
MGIC Investment Corp. 18,700 850,850
------------------------------------------------------------------------------------------
Morgan Stanley Dean Witter & Co. 88,600 7,375,950
10 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Diversified Financial (continued)
PaineWebber Group, Inc. 5,700 $ 259,350
------------------------------------------------------------------------------------------
PMI Group, Inc. (The) 30,000 1,425,000
------------------------------------------------------------------------------------------
SEI Investments Co. 6,700 266,744
-----------
41,332,382
------------------------------------------------------------------------------------------
Insurance--1.9%
AFLAC, Inc. 11,500 528,281
------------------------------------------------------------------------------------------
Allmerica Financial Corp. 16,000 838,000
------------------------------------------------------------------------------------------
American International Group, Inc. 56,200 6,603,500
------------------------------------------------------------------------------------------
AXA Financial, Inc. 84,200 2,862,800
------------------------------------------------------------------------------------------
Cigna Corp. 32,000 2,992,000
------------------------------------------------------------------------------------------
Cincinnati Financial Corp. 9,700 304,944
------------------------------------------------------------------------------------------
Jefferson-Pilot Corp. 18,500 1,044,094
------------------------------------------------------------------------------------------
Radian Group, Inc. 4,000 207,000
------------------------------------------------------------------------------------------
St. Paul Cos., Inc. 10,500 358,313
-----------
15,738,932
------------------------------------------------------------------------------------------
Savings & Loans--0.1%
Dime Bancorp, Inc. 15,000 236,250
------------------------------------------------------------------------------------------
Golden State Bancorp, Inc.(1) 30,000 540,000
------------------------------------------------------------------------------------------
Golden West Financial Corp. 11,000 448,938
-----------
1,225,188
------------------------------------------------------------------------------------------
Healthcare--8.4%
------------------------------------------------------------------------------------------
Healthcare/Drugs--8.2%
Alpharma, Inc., Cl. A 5,000 311,250
------------------------------------------------------------------------------------------
Amgen, Inc.(1) 137,000 9,624,250
------------------------------------------------------------------------------------------
Andrx Corp.(1) 29,600 1,892,088
------------------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 127,200 7,409,400
------------------------------------------------------------------------------------------
Chiron Corp.(1) 7,500 356,250
------------------------------------------------------------------------------------------
HCA-Healthcare Corp. (The) 18,800 571,050
------------------------------------------------------------------------------------------
Immunex Corp.(1) 25,000 1,235,938
------------------------------------------------------------------------------------------
Johnson & Johnson 112,200 11,430,375
------------------------------------------------------------------------------------------
Mallinckrodt, Inc. 1,300 56,469
------------------------------------------------------------------------------------------
Medimmune, Inc.(1) 14,000 1,036,000
------------------------------------------------------------------------------------------
Merck & Co., Inc. 219,000 16,780,875
------------------------------------------------------------------------------------------
Pfizer, Inc. 186,300 8,942,400
------------------------------------------------------------------------------------------
Schering-Plough Corp. 92,000 4,646,000
------------------------------------------------------------------------------------------
Trigon Healthcare, Inc.(1) 19,500 1,005,469
------------------------------------------------------------------------------------------
UnitedHealth Group, Inc. 31,600 2,709,700
-----------
68,007,514
Oppenheimer Main Street Growth & Income Fund/VA 11
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Healthcare/Supplies & Services--0.2%
Alberto-Culver Co., Cl. B 2,000 $ 61,125
------------------------------------------------------------------------------------------
Allergan, Inc. 13,200 983,400
------------------------------------------------------------------------------------------
Biomet, Inc. 7,000 269,063
------------------------------------------------------------------------------------------
PacifiCare Health Systems, Inc.(1) 2,600 156,488
------------------------------------------------------------------------------------------
PerkinElmer, Inc. 7,800 515,775
-----------
1,985,851
------------------------------------------------------------------------------------------
Technology--30.5%
------------------------------------------------------------------------------------------
Computer Hardware--7.8%
Agilent Technologies, Inc.(1) 9,147 674,591
------------------------------------------------------------------------------------------
Apple Computer, Inc.(1) 60,000 3,142,500
------------------------------------------------------------------------------------------
Dell Computer Corp.(1) 87,000 4,290,188
------------------------------------------------------------------------------------------
Electronics for Imaging, Inc.(1) 10,300 260,719
------------------------------------------------------------------------------------------
EMC Corp.(1) 20,000 1,538,750
------------------------------------------------------------------------------------------
Gateway, Inc.(1) 18,000 1,021,500
------------------------------------------------------------------------------------------
Hewlett-Packard Co. 95,300 11,900,588
------------------------------------------------------------------------------------------
International Business Machines Corp. 198,600 21,759,113
------------------------------------------------------------------------------------------
KLA Instruments Corp.(1) 31,600 1,850,575
------------------------------------------------------------------------------------------
Lexmark International Group, Inc., Cl. A 4,100 275,725
------------------------------------------------------------------------------------------
NCR Corp.(1) 4,600 179,113
------------------------------------------------------------------------------------------
Network Appliance, Inc.(1) 20,000 1,610,000
------------------------------------------------------------------------------------------
Seagate Technology, Inc.(1) 31,000 1,705,000
------------------------------------------------------------------------------------------
Sun Microsystems, Inc.(1) 158,400 14,404,500
-----------
64,612,862
------------------------------------------------------------------------------------------
Computer Services--0.8%
Applied Micro Circuits Corp.(1) 3,300 325,875
------------------------------------------------------------------------------------------
Automatic Data Processing, Inc. 51,300 2,747,756
------------------------------------------------------------------------------------------
DST Systems, Inc.(1) 3,000 228,375
------------------------------------------------------------------------------------------
First Data Corp. 51,300 2,545,763
------------------------------------------------------------------------------------------
Sycamore Networks, Inc. 6,500 717,438
-----------
6,565,207
------------------------------------------------------------------------------------------
Computer Software--4.3%
Adobe Systems, Inc. 20,000 2,600,000
------------------------------------------------------------------------------------------
BEA Systems, Inc.(1) 4,200 207,638
------------------------------------------------------------------------------------------
Computer Associates International, Inc. 76,400 3,910,725
------------------------------------------------------------------------------------------
Computer Sciences Corp.(1) 5,000 373,438
------------------------------------------------------------------------------------------
Electronic Data Systems Corp. 15,000 618,750
------------------------------------------------------------------------------------------
Oracle Corp.(1) 248,000 20,847,500
------------------------------------------------------------------------------------------
Peoplesoft, Inc.(1) 19,300 323,275
------------------------------------------------------------------------------------------
Portal Software, Inc.(1) 2,300 146,913
------------------------------------------------------------------------------------------
Siebel Systems, Inc.(1) 12,000 1,962,750
------------------------------------------------------------------------------------------
Symantec Corp.(1) 12,000 647,250
------------------------------------------------------------------------------------------
Veritas Software Corp.(1) 31,000 3,503,484
------------------------------------------------------------------------------------------
Yahoo!, Inc.(1) 4,400 545,050
-----------
35,686,773
12 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Communications Equipment--5.7%
ADC Telecommunications, Inc.(1) 11,400 $ 956,175
------------------------------------------------------------------------------------------
CIENA Corp.(1) 14,900 2,483,644
------------------------------------------------------------------------------------------
Cisco Systems, Inc. 465,000 29,556,563
------------------------------------------------------------------------------------------
Harmonic, Inc.(1) 4,000 99,000
------------------------------------------------------------------------------------------
Nortel Networks Corp. 182,000 12,421,500
------------------------------------------------------------------------------------------
Scientific-Atlanta, Inc. 17,000 1,266,500
-----------
46,783,382
------------------------------------------------------------------------------------------
Electronics--11.6%
Advanced Micro Devices, Inc.(1) 8,900 687,525
------------------------------------------------------------------------------------------
Altera Corp.(1) 17,500 1,783,906
------------------------------------------------------------------------------------------
Analog Devices, Inc.(1) 54,000 4,104,000
------------------------------------------------------------------------------------------
Applied Materials, Inc.(1) 50,000 4,531,250
------------------------------------------------------------------------------------------
Atmel Corp.(1) 25,000 921,875
------------------------------------------------------------------------------------------
Cypress Semiconductor Corp.(1) 36,000 1,521,000
------------------------------------------------------------------------------------------
General Motors Corp., Cl. H(1) 8,132 713,583
------------------------------------------------------------------------------------------
Grainger (W.W.), Inc. 6,700 206,444
------------------------------------------------------------------------------------------
Intel Corp. 423,000 56,549,813
------------------------------------------------------------------------------------------
Lam Research Corp.(1) 30,000 1,125,000
------------------------------------------------------------------------------------------
Lattice Semiconductor Corp.(1) 14,000 967,750
------------------------------------------------------------------------------------------
Linear Technology Corp. 26,600 1,700,738
------------------------------------------------------------------------------------------
LSI Logic Corp.(1) 35,000 1,894,375
------------------------------------------------------------------------------------------
Maxim Integrated Products, Inc.(1) 7,800 529,913
------------------------------------------------------------------------------------------
National Semiconductor Corp.(1) 43,700 2,479,975
------------------------------------------------------------------------------------------
Novellus Systems, Inc.(1) 6,000 339,375
------------------------------------------------------------------------------------------
PMC-Sierra, Inc.(1) 10,000 1,776,875
------------------------------------------------------------------------------------------
QLogic Corp.(1) 12,000 792,750
------------------------------------------------------------------------------------------
RF Micro Devices, Inc.(1) 7,000 613,375
------------------------------------------------------------------------------------------
Teradyne, Inc.(1) 24,900 1,830,150
------------------------------------------------------------------------------------------
Texas Instruments, Inc. 90,000 6,181,875
------------------------------------------------------------------------------------------
Waters Corp.(1) 7,200 898,650
------------------------------------------------------------------------------------------
Xilinx, Inc.(1) 48,000 3,963,000
-----------
96,113,197
------------------------------------------------------------------------------------------
Photography--0.3%
Eastman Kodak Co. 38,300 2,278,850
------------------------------------------------------------------------------------------
Transportation--0.7%
------------------------------------------------------------------------------------------
Air Transportation--0.4%
Continental Airlines, Inc., Cl. B(1) 51,558 2,423,226
------------------------------------------------------------------------------------------
Delta Air Lines, Inc. 9,000 455,063
------------------------------------------------------------------------------------------
UAL Corp. 4,800 279,300
-----------
3,157,589
Oppenheimer Main Street Growth & Income Fund/VA 13
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
------------------------------------------------------------------------------------------
Railroads & Truckers--0.3%
------------------------------------------------------------------------------------------
Rollins Truck Leasing Co. 10,000 $ 69,375
------------------------------------------------------------------------------------------
Union Pacific Corp. 36,700 1,364,781
------------------------------------------------------------------------------------------
XTRA Corp.(1) 18,600 733,538
------------
2,167,694
------------------------------------------------------------------------------------------
Utilities--1.7%
------------------------------------------------------------------------------------------
Electric Utilities--1.4%
AES Corp. (The)(1) 10,400 474,500
------------------------------------------------------------------------------------------
Allegheny Energy, Inc. 9,800 268,275
------------------------------------------------------------------------------------------
Ameren Corp. 13,300 448,875
------------------------------------------------------------------------------------------
Calpine Corp.(1) 12,000 789,000
------------------------------------------------------------------------------------------
Conectiv, Inc. 4,000 62,250
------------------------------------------------------------------------------------------
DTE Energy Co. 12,300 375,919
------------------------------------------------------------------------------------------
Energy East Corp. 14,100 268,781
------------------------------------------------------------------------------------------
Entergy Corp. 13,900 377,906
------------------------------------------------------------------------------------------
FirstEnergy Corp. 7,400 172,975
------------------------------------------------------------------------------------------
Florida Progress Corp. 32,000 1,500,000
------------------------------------------------------------------------------------------
IPALCO Enterprises, Inc. 10,000 201,250
------------------------------------------------------------------------------------------
Northeast Utilities Co. 10,400 226,200
------------------------------------------------------------------------------------------
Peco Energy Co. 38,500 1,552,031
------------------------------------------------------------------------------------------
PG&E Corp. 22,800 561,450
------------------------------------------------------------------------------------------
PPL Corp. 24,000 526,500
------------------------------------------------------------------------------------------
Public Service Enterprise Group, Inc. 50,900 1,762,413
------------------------------------------------------------------------------------------
Southern Co. 24,400 568,825
------------------------------------------------------------------------------------------
TXU Corp. 8,000 236,000
------------------------------------------------------------------------------------------
Unicom Corp. 36,000 1,392,750
------------
11,765,900
------------------------------------------------------------------------------------------
Gas Utilities--0.3%
Enron Corp. 33,300 2,147,850
------------------------------------------------------------------------------------------
NICOR, Inc. 1,200 39,150
------------------------------------------------------------------------------------------
Sempra Energy 15,929 270,794
------------
2,457,794
------------
Total Common Stocks (Cost $700,019,961) 786,094,700
14 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Investments (Unaudited) (Continued)
Market Value
Shares Note 1
==========================================================================================
Preferred Stocks--0.4%
------------------------------------------------------------------------------------------
Reliant Energy, Inc., 7% Automatic
Common Exchange Securities for
Time Warner, Inc. Common Stock (Cost $1,170,994) 25,000 $ 3,140,320
Principal
Amount
==========================================================================================
Repurchase Agreements--7.0%
------------------------------------------------------------------------------------------
Repurchase agreement with PaineWebber,
Inc., 6.55%, dated 6/30/00, to be
repurchased at $58,302,806 on 7/3/00,
collateralized by U.S. Treasury Nts.,
5.50%, 7/31/01, with a value of $29,588,859
and U.S. Treasury Bonds, 7.875%, 11/15/07,
with a value of $29,913,085 (Cost $58,271,000) $58,271,000 58,271,000
------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $759,461,955) 102.3% 847,506,020
------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (2.3) (19,396,204)
----------- ------------
Net Assets 100.0% $828,109,816
=========== ============
</TABLE>
1. Non-income-producing security.
2. Identifies issues considered to be illiquid or restricted--See Note 6 of
Notes to Financial Statements.
See accompanying Notes to Financial Statements.
Oppenheimer Main Street Growth & Income Fund/VA 15
<PAGE>
Statement of Assets and Liabilities June 30, 2000 (Unaudited)
<TABLE>
<S> <C>
================================================================================================
Assets
Investments, at value (cost $759,461,955)--see accompanying statement $847,506,020
------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold 3,816,113
Shares of beneficial interest sold 2,220,772
Interest and dividends 451,141
Other 3,566
------------
Total assets 853,997,612
================================================================================================
Liabilities
Bank overdraft 256,417
------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 24,461,548
Shares of beneficial interest redeemed 1,096,247
Trustees' compensation 557
Transfer and shareholder servicing agent fees 78
Other 72,949
------------
Total liabilities 25,887,796
================================================================================================
Net Assets $828,109,816
============
================================================================================================
Composition of Net Assets
Paid-in capital $758,780,121
------------------------------------------------------------------------------------------------
Undistributed net investment income 2,639,301
------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions (21,353,189)
------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of
assets and liabilities denominated in foreign currencies 88,043,583
------------
Net assets--applicable to 35,461,781 shares of beneficial interest outstanding $828,109,816
============
================================================================================================
Net Asset Value, Redemption Price Per Share and Offering Price Per Share $23.35
</TABLE>
See accompanying Notes to Financial Statements.
16 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Statement of Operations For the Six Months Ended June 30, 2000 (Unaudited)
<TABLE>
<S> <C>
=====================================================================================
Investment Income
Dividends (net of foreign withholding taxes of $28,661) $ 3,350,589
-------------------------------------------------------------------------------------
Interest 1,749,410
------------
Total income 5,099,999
=====================================================================================
Expenses
Management fees 2,376,588
-------------------------------------------------------------------------------------
Custodian fees and expenses 9,021
-------------------------------------------------------------------------------------
Trustees' compensation 1,345
-------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees 942
-------------------------------------------------------------------------------------
Other 55,113
------------
Total expenses 2,443,009
Less expenses paid indirectly (9,021)
------------
Net expenses 2,433,988
=====================================================================================
Net Investment Income 2,666,011
=====================================================================================
Realized and Unrealized Gain (Loss)
Net realized loss on:
Investments (19,721,605)
Foreign currency transactions (27,283)
------------
Net realized loss (19,748,888)
-------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on:
Investments 21,825,698
Translation of assets and liabilities denominated in foreign currencies (249,806)
------------
Net change 21,575,892
------------
Net realized and unrealized gain 1,827,004
=====================================================================================
Net Increase in Net Assets Resulting from Operations $ 4,493,015
============
</TABLE>
See accompanying Notes to Financial Statements.
Oppenheimer Main Street Growth & Income Fund/VA 17
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 2000 December 31,
(Unaudited) 1999
=============================================================================================
<S> <C> <C>
Operations
Net investment income $ 2,666,011 $ 2,473,903
---------------------------------------------------------------------------------------------
Net realized gain (loss) (19,748,888) 35,804,975
---------------------------------------------------------------------------------------------
Net change in unrealized appreciation 21,575,892 41,879,594
------------ ------------
Net increase in net assets resulting from operations 4,493,015 80,158,472
=============================================================================================
Dividends and/or Distributions to Shareholders
Dividends from net investment income (2,497,726) (1,427,635)
---------------------------------------------------------------------------------------------
Distributions from net realized gain (32,976,915) (2,405,256)
=============================================================================================
Beneficial Interest Transactions
Net increase in net assets resulting from
beneficial interest transactions 303,780,410 170,632,137
=============================================================================================
Net Assets
Total increase 272,798,784 246,957,718
---------------------------------------------------------------------------------------------
Beginning of period 555,311,032 308,353,314
------------ ------------
End of period (including undistributed net investment
income of $2,639,301 and $2,471,016, respectively) $828,109,816 $555,311,032
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
18 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Six Months Ended
June 30, 2000 Year Ended December 31,
(Unaudited) 1999 1998 1997 1996 1995(1)
==============================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $24.63 $20.48 $20.58 $16.37 $12.51 $10.00
------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .06 .11 .13 .19 .14 .01
Net realized and unrealized gain (loss) (.01) 4.29 .92 4.91 3.91 2.52
------------------------------------------------------------------------------------------------------------------------------
Total income from investment operations .05 4.40 1.05 5.10 4.05 2.53
------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.09) (.09) (.05) (.17) (.14) (.02)
Distributions from net realized gain (1.24) (.16) (1.10) (.72) (.05) --
------------------------------------------------------------------------------------------------------------------------------
Total dividends and/or distributions to shareholders (1.33) (.25) (1.15) (.89) (.19) (.02)
------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $23.35 $24.63 $20.48 $20.58 $16.37 $12.51
====== ====== ====== ====== ====== ======
==============================================================================================================================
Total Return, at Net Asset Value(2) 0.19% 21.71% 4.70% 32.48% 32.51% 25.25%
==============================================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $828,110 $555,311 $308,353 $155,368 $47,009 $4,288
------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $694,215 $391,063 $234,306 $ 94,906 $21,562 $1,809
------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment income 0.77% 0.63% 0.74% 1.15% 1.41% 0.50%
Expenses 0.71% 0.78% 0.79%(4) 0.83%(4) 1.00%(4) 2.07%(4)
------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 30% 118% 86% 79% 113% 24%
</TABLE>
1. For the period from July 5, 1995 (commencement of operations) to December 31,
1995.
2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or commencement of operations), 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. Total returns are not annualized for periods less than one
full year. Total return information does not reflect expenses that apply at the
separate account level or to related insurance products. Inclusion of these
charges would reduce the total return figures for all periods shown.
3. Annualized for periods less than one full year.
4. Expense ratio has not been grossed up to reflect the effect of expenses paid
indirectly.
See accompanying Notes to Financial Statements.
Oppenheimer Main Street Growth & Income Fund/VA 19
<PAGE>
Notes to Financial Statements (Unaudited)
================================================================================
1. Significant Accounting Policies
Oppenheimer Main Street Growth & Income Fund/VA (the Fund) is a separate series
of Oppenheimer Variable Account Funds (the Trust), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended. The Fund's objective is to seek a high total return (which includes
growth in the value of its shares as well as current income) from equity and
debt securities. The Trust's investment advisor is OppenheimerFunds, Inc. (the
Manager). The following is a summary of significant accounting policies
consistently followed by the Fund.
--------------------------------------------------------------------------------
Securities Valuation. Securities listed or traded on National Stock Exchanges or
other domestic or foreign exchanges are valued based on the last sale price of
the security traded on that exchange prior to the time when the Fund's assets
are valued. In the absence of a sale, the security is valued at the last sale
price on the prior trading day, if it is within the spread of the closing bid
and asked prices, and if not, at the closing bid price. Securities (including
restricted securities) for which quotations are not readily available are valued
primarily using dealer-supplied valuations, a portfolio pricing service
authorized by the Board of Trustees, or at their fair value. Fair value is
determined in good faith under consistently applied procedures under the
supervision of the Board of Trustees. Short-term "money market type" debt
securities with remaining maturities of sixty days or less are valued at
amortized cost (which approximates market value).
--------------------------------------------------------------------------------
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 foreign 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 on investments
is separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's 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.
--------------------------------------------------------------------------------
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.
--------------------------------------------------------------------------------
Dividends and Distributions to Shareholders. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date.
--------------------------------------------------------------------------------
Classification of Dividends and 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 dividends and distributions made during the fiscal year from net
investment income or net realized gains may differ from its ultimate
characterization for federal income tax purposes. Also, due to timing of
dividends and distributions, the fiscal year in which amounts are distributed
may differ from the fiscal year in which the income or realized gain was
recorded by the Fund.
20 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Notes to Financial Statements (Unaudited) (Continued)
================================================================================
Expense Offset Arrangements. Expenses paid indirectly represent a reduction of
custodian fees for earnings on cash balances maintained by the Fund.
--------------------------------------------------------------------------------
Other. Investment transactions are accounted for as of trade date and dividend
income is recorded on the ex-dividend date. Realized gains and losses on
investments and options written 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>
Six Months Ended June 30, 2000 Year Ended December 31, 1999
---------------------------------- -------------------------------
Shares Amount Shares Amount
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Sold 13,366,571 $314,257,184 9,936,050 $224,240,741
Dividends and/or distributions reinvested 1,515,363 35,474,641 186,334 3,832,892
Redeemed (1,965,156) (45,951,416) (2,632,085) (57,441,496)
---------- ------------ ---------- ------------
Net increase 12,916,778 $303,780,409 7,490,299 $170,632,137
========== ============ ========== ============
</TABLE>
================================================================================
3. Purchases and Sales of Securities
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the six months ended June 30, 2000, were
$447,427,181 and $183,871,978, respectively.
================================================================================
4. Fees and Other Transactions with Affiliates
Management Fees. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Trust. The annual fees are 0.75% of the
first $200 million of average annual net assets, 0.72% of the next $200 million,
0.69% of the next $200 million, 0.66% of the next $200 million and 0.60% of
average annual net assets over $800 million. The Fund's management fee for the
six months ended June 30, 2000, was an annualized rate of 0.69%, before any
waiver by the Manager.
--------------------------------------------------------------------------------
Transfer Agent Fees. OppenheimerFunds Services (OFS), a division of the Manager,
is the transfer agent for the Fund and is responsible for maintaining the
shareholder registry and shareholder accounting records for the Fund. OFS
provides these services for cost.
Oppenheimer Main Street Growth & Income Fund/VA 21
<PAGE>
Notes to Financial Statements (Unaudited) (Continued)
================================================================================
5. Foreign Currency Contracts
A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts for operational purposes and to seek to protect against
adverse exchange rate fluctuations. Risks to the Fund include the potential
inability of the counterparty to meet the terms of the contract.
The net U.S. dollar value of foreign currency underlying all
contractual commitments held by the Fund and the resulting unrealized
appreciation or depreciation are determined using foreign currency exchange
rates as provided by a reliable bank, dealer or pricing service. Unrealized
appreciation and depreciation on foreign currency contracts are reported in the
Statement of Assets and Liabilities.
The Fund may realize a gain or loss upon the closing or settlement of
the foreign currency transactions. Realized gains and losses are reported with
all other foreign currency gains and losses in the Statement of Operations.
Securities denominated in foreign currency to cover net exposure on
outstanding foreign currency contracts are noted in the Statement of Investments
where applicable.
================================================================================
6. Illiquid or Restricted Securities
As of June 30, 2000, investments in securities included issues that are illiquid
or restricted. Restricted securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund intends to invest no more than
15% of its net assets (determined at the time of purchase and reviewed
periodically) in illiquid or restricted securities. Certain restricted
securities, eligible for resale to qualified institutional investors, are not
subject to that limitation. The aggregate value of illiquid or restricted
securities subject to this limitation as of June 30, 2000 was $34,763, which
represents 0.00% of the Fund's net assets, all of which is considered
restricted. Information concerning restricted securities is as follows:
<TABLE>
<CAPTION>
Valuation Per
Acquisition Cost Per Unit as of
Security Dates Unit June 30, 2000
------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Intermedia Communications, Inc. 9/29/98-12/29/98 $12.51-$21.54 $28.26
</TABLE>
22 Oppenheimer Main Street Growth & Income Fund/VA
<PAGE>
Oppenheimer Main Street(R) Growth & Income Fund/VA
A Series of Oppenheimer Variable Account Funds
<TABLE>
====================================================================================================================================
<S> <C>
Officers and Trustees James C. Swain, Trustee and Chairman of the Board
Bridget A. Macaskill, Trustee and President
William L. Armstrong, Trustee
Robert G. Avis, Trustee
William A. Baker, Trustee
George C. Bowen, Trustee
Edward L. Cameron, Trustee
Jon S. Fossel, Trustee
Sam Freedman, Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
Charles Albers, Vice President
Nikolaos Monoyios, Vice President
Andrew J. Donohue, Vice President and Secretary
Brian W. Wixted, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
====================================================================================================================================
Investment Advisor OppenheimerFunds, Inc.
====================================================================================================================================
Transfer Agent OppenheimerFunds Services
====================================================================================================================================
Custodian of Portfolio Securities The Bank of New York
====================================================================================================================================
Independent Auditors Deloitte & Touche LLP
====================================================================================================================================
Legal Counsel Myer, Swanson, Adams & Wolf, P.C.
The financial statements included herein have been taken from the records of the Fund
without examination of those records by the independent auditors.
This is a copy of a report to shareholders of Oppenheimer Main Street Growth & Income
Fund/VA. For material information concerning the Fund, see the Prospectus. This report
must be preceded or accompanied by the Fund's prospectus, the separate account
prospectus, and current standardized average annual total returns for the separate
account being offered.
Shares of Oppenheimer funds are not deposits or obligations of any bank, are not
guaranteed by any bank, are not insured by the FDIC or any other agency, and involve
investment risks, including the possible loss of the principal amount invested.
</TABLE>
(C)Copyright 2000 OppenheimerFunds, Inc. All rights reserved.
Oppenheimer Main Street Growth & Income Fund/VA 23
