<PAGE> 1
OPPENHEIMER INSURED TAX-EXEMPT BOND FUND
ANNUAL REPORT SEPTEMBER 30, 1994
(OPPENHEIMERFUNDS(R) LOGO)
<PAGE> 2
FUND FACTS
IN THIS REPORT:
ANSWERS TO TIMELY QUESTIONS
YOU SHOULD ASK YOUR FUND'S MANAGERS.
* HOW DID THE FEDERAL RESERVE'S MOVES TO RAISE INTEREST RATES AFFECT THE FUND'S
INVESTMENT STRATEGY AND RETURNS FOR THE PAST YEAR?
* WHAT'S THE OUTLOOK FOR THE MUNICIPAL MARKET OVERALL AND THE INSURED SECTOR IN
PARTICULAR?
* WHAT KINDS OF BONDS OFFER THE BEST BUYING OPPORTUNITIES TODAY?
FACTS EVERY SHAREHOLDER SHOULD KNOW ABOUT
OPPENHEIMER INSURED TAX-EXEMPT BOND FUND
- -------------------------------------------------------------------------------
1 The Fund seeks current income exempt from federal
income taxes from a select portfolio of municipal bonds
and notes, whose payments of interest and principal are
insured.(1)
- -------------------------------------------------------------------------------
2 Total return at net asset value for the 12 months ended
9/30/94 was -5.46% for Class A shares and -6.20% for
Class B shares.(2)
- -------------------------------------------------------------------------------
3 For many investors, earning tax-free income is
important under current federal tax rates. The table
below shows the taxable equivalent yield needed to
match the Fund's standardized yield for the top tax
brackets.*
<TABLE>
<CAPTION>
HERE IS THE TAXABLE EQUIVALENT OF THE FUND'S
YIELDS FOR AN INVESTOR IN THE:
------------------------------------------------------
FUND YIELD 31% FEDERAL 36% FEDERAL 39.6% FEDERAL
ON 9/30/94 TAX BRACKET TAX BRACKET TAX BRACKET
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS A 5.00%(3) 7.25% 7.81% 8.28%
CLASS B 4.47%(3) 6.48% 6.98% 7.40%
</TABLE>
*This table assumes that an investor's highest tax
bracket applies to the change in taxable income
resulting from a switch between taxable and non-taxable
investments. A portion of the Fund's distributions may
be subject to federal and/or state income taxes. For
investors subject to alternative minimum tax, a portion
of the Fund's distributions may increase that tax.
- -------------------------------------------------------------------------------
4 Average annual total returns for Class A shares for the
1- and 5-year periods ended September 30, 1994 and
since inception of the Fund on November 11, 1986 were
-9.95%, 6.35% and 6.06%, respectively. For Class B
shares, average annual total returns for the 1-year
period ended September 30, 1994 and since inception on
May 3, 1993 were -10.89% and -3.23%, respectively.(4)
- -------------------------------------------------------------------------------
5 "Insured bonds recently have been providing
exceptionally attractive yields compared to uninsured
issues of the same quality. This combination of
attractive, tax-free income and the guaranteed timely
payment of principal and interest on nearly every bond
in the portfolio should continue to make the Fund
attractive to conservative, tax-conscious
investors."
Portfolio Managers Bob Patterson and Caryn
Halbrecht, September 30, 1994
(1) The value of the Fund's shares is not insured.
(2) Based on the changes in net asset value per share from 9/30/93 to 9/30/94,
without deducting any sales charges. Such performance would have been lower if
sales charges were taken into account.
(3) Standardized yield is net investment income calculated on a
yield-to-maturity basis for the 30-day period ended 9/30/94, divided by the
maximum offering price at the end of the period, compounded semi-annually and
then annualized. Falling net asset values will tend to artificially raise
yields.
(4) Average annual total returns are based on a hypothetical investment held
until 9/30/94, after deducting the current maximum initial sales charge of
4.75% for Class A shares and the contingent deferred sales charge of 5%
(1-year) and 4% (since inception) for Class B shares. The Fund's maximum sales
charge rate for Class A shares was lower during a portion of some of the
periods shown, and actual investment results will be different as a result of
the change.
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 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 Insured Tax-Exempt Bond Fund
<PAGE> 3
REPORT TO SHAREHOLDERS
Oppenheimer Insured Tax-Exempt Bond Fund met its objectives for the year ended
September 30, 1994, providing a level of tax-free income that would be
difficult to match on taxable investments of comparable quality, and performing
well on a long-term basis in some of the most challenging bond markets seen in
years.
Standardized yields for Class A and Class B shares for the 30 days
ended September 30, 1994 were 5.00% and 4.47%, respectively.(5)
The Fund was, of course, affected by aggressive increases in
short-term interest rates by the Federal Reserve Board, which caused the prices
of most bonds to decline.
At this writing, the market's fundamentals are strong and getting
stronger. The Fed's actions have helped keep possible inflation in check, while
the market's supply and demand characteristics are positive. The supply of
insured municipal bonds is running below last year's pace, while demand for
tax-free securities is rising, driven by both rising taxes and the high volume
of bond calls nationwide expected over the next 12 to 18 months. This
combination of low inflation, shrinking bond supply, and mounting demand should
provide support for bond prices.
Just as important, the finances of issuing states continue to
improve, providing your managers with opportunities to add several attractive
issues to the portfolio.
Throughout the year, your managers maintained their focus on
high-quality, essential service issues, diversified by market sector and by
state, and backed by stable, predictable revenue streams, as well as on bonds
offering significant call protection.
Looking ahead, your managers believe that the insured municipal
market offers substantial value to investors. The fundamentals for long-term
performance are in place, and your managers will look for opportunities to buy
value at attractive prices--the best way to produce long-term investment gains.
We appreciate your confidence in Oppenheimer Insured Tax-Exempt Bond
Fund, and we look forward to continuing to help you meet your investment goals
in the future.
<TABLE>
<S> <C>
/s/ JAMES C. SWAIN /s/ JON S. FOSSEL
- ------------------ -----------------
James C. Swain Jon S. Fossel
Chairman President
Oppenheimer Tax-Exempt Bond Fund for Oppenheimer Tax-Exempt Bond Fund for
Oppenheimer Insured Tax-Exempt Bond Fund Oppenheimer Insured Tax-Exempt Bond Fund
</TABLE>
October 21, 1994
(5) See footnote 3, page 2.
(3) Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 4
STATEMENT OF INVESTMENTS September 30, 1994
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
===============================================================================================================================
MUNICIPAL BONDS AND NOTES--97.9%
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------------
ALABAMA--1.4% Pelham, Alabama General Obligation Warrants,
AMBAC Insured, 7.10%, 8/1/15 Aaa/AAA/AAA $1,000,000 $1,112,331
- -------------------------------------------------------------------------------------------------------------------------------
ALASKA--4.9% Alaska Energy Authority Power Revenue Bonds,
Bradley Lake Hydroelectric Project, Series 2,
MBIA Insured, 7.25%, 7/1/21 Aaa/AAA 500,000 532,496
------------------------------------------------------------------------------------------------------
North Slope Boro, Alaska General Obligation
Revenue Refunding Bonds, Series G, FSA Insured,
8.35%, 6/30/98 Aaa/AAA/A- 3,000,000 3,337,251
------------
3,869,747
- -------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA--5.5% California Public Capital Improvements
Financing Authority Revenue Bonds, Pooled
Project, Series B, BIG Insured, 8.10%, 3/1/18 Aaa/AAA 240,000 261,624
------------------------------------------------------------------------------------------------------
Loma Linda, California Revenue Bonds,
City Hall & Public Improvement Projects,
AMBAC Insured, 5.40%, 1/1/16 Aaa/AAA/AAA 2,000,000 1,746,162
------------------------------------------------------------------------------------------------------
Los Angeles County, California Metropolitan
Transportation Authority Sales Tax Revenue
Refunding Bonds, Series A, MBIA Insured,
5.625%, 7/1/18 Aaa/AAA/A+ 1,500,000 1,341,198
------------------------------------------------------------------------------------------------------
Sacramento, California Municipal Electric
Utility District Revenue Refunding Bonds,
Series G, MBIA Insured, 6.50%, 9/1/13 Aaa/AAA/A- 1,000,000 1,022,974
-----------
4,371,958
- -------------------------------------------------------------------------------------------------------------------------------
COLORADO--2.1% Colorado Health Facilities Authority
Revenue Bonds:
PSL Health System Project,
Series A, FSA Insured, 7.25%, 2/15/16 Aaa/AAA 500,000 539,242
Rose Medical Center, Prerefunded,
MBIA Insured, 7%, 8/15/21 Aaa/AAA 500,000 553,548
------------------------------------------------------------------------------------------------------
Poudre Valley, Colorado Hospital District
Revenue Bonds, Prerefunded, AMBAC Insured,
6.625%, 12/1/11 Aaa/AAA/AAA 500,000 540,468
-----------
1,633,258
- -------------------------------------------------------------------------------------------------------------------------------
DELAWARE--2.8% Delaware Transportation System Authority
Revenue Refunding Bonds, 7.75%, 7/1/04 Aaa/AAA 2,000,000 2,210,050
- -------------------------------------------------------------------------------------------------------------------------------
FLORIDA--1.2% Orange County, Florida Tourist Development
Tax Revenue Refunding Bonds, Series A,
MBIA Insured, 5.90%, 10/1/10 Aaa/AAA/A 1,000,000 974,767
- -------------------------------------------------------------------------------------------------------------------------------
GEORGIA--1.2% Fulton De Kalb, Georgia Hospital Authority
Revenue Certificates, Prerefunded, Series A,
AMBAC Insured, 7.25%, 1/1/20 Aaa/AAA/AAA 900,000 994,873
</TABLE>
4 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 5
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ILLINOIS--7.6% Chicago, Illinois Midway Airport Revenue
Bonds, Series A, MBIA Insured, 6.25%, 1/1/14 Aaa/AAA $ 500,000 $ 482,071
------------------------------------------------------------------------------------------------------
Cook County, Illinois Community College District
No. 508 Certificates of Participation:
FGIC Insured, 8.75%, 1/1/05 Aaa/AAA/AAA 500,000 612,288
Lease Certificates, Series C,
MBIA Insured, 7.70%, 12/1/07 Aaa/AAA 2,500,000 2,863,110
------------------------------------------------------------------------------------------------------
Illinois Health Facilities Authority Revenue Bonds,
Memorial Medical Center Project, MBIA Insured,
6.75%, 10/1/11 Aaa/AAA 2,000,000 2,069,036
-----------
6,026,505
- -------------------------------------------------------------------------------------------------------------------------------
INDIANA--5.8% Fort Wayne, Indiana Hospital Authority Revenue
Bonds, Parkview Memorial Hospital Project,
Series A, FGIC Insured, 7.50%, 11/15/11 Aaa/AAA/AAA 250,000 270,579
------------------------------------------------------------------------------------------------------
Hamilton Southeastern, Indiana Consolidated
School Building Corp. Revenue Refunding Bonds,
Fst. Mtg., AMBAC Insured, 7%, 7/1/11 Aaa/AAA/AAA 500,000 535,303
------------------------------------------------------------------------------------------------------
Indiana Health Facilities Financing Authority
Hospital Revenue Bonds, Community
Hospital of Indiana, MBIA Insured, 7%, 7/1/21 Aaa/AAA 500,000 528,717
------------------------------------------------------------------------------------------------------
Indiana State Office Building Revenue
Bonds, Commission Capital Complex,
Series B, MBIA Insured, 7.40%, 7/1/15 Aaa/AAA 2,500,000 2,757,040
------------------------------------------------------------------------------------------------------
Whitko, Indiana Middle School Building Corp.
Revenue Bonds, Fst. Mtg., AMBAC Insured,
6.75%, 7/15/12 Aaa/AAA/AAA 500,000 513,624
-----------
4,605,263
- -------------------------------------------------------------------------------------------------------------------------------
KANSAS--1.3% Burlington, Kansas Pollution Control Revenue
Refunding Bonds, Kansas Gas and Electric Co.
Project, MBIA Insured, 7%, 6/1/31 Aaa/AAA 1,000,000 1,055,228
- -------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS--6.8% Massachusetts State General Obligation Bonds,
FGIC Insured, 7.875%, 6/1/97 Aaa/AAA/AAA 1,500,000 1,615,891
------------------------------------------------------------------------------------------------------
Massachusetts State Health & Educational
Facilities Revenue Bonds, Lahey Clinic Medical
Center, Series B, MBIA Insured, 5.625%, 7/1/15 Aaa/AAA 2,000,000 1,802,900
------------------------------------------------------------------------------------------------------
Massachusetts State Housing Finance
Revenue Bonds, Series A, AMBAC Insured,
6.60%, 7/1/14 Aaa/AAA/AAA 2,000,000 1,990,998
-----------
5,409,789
- -------------------------------------------------------------------------------------------------------------------------------
MICHIGAN--3.5% Detroit, Michigan Sewage Disposal System Revenue
Refunding Bonds, FGIC Insured, 7.72%, 7/1/23(1) Aaa/AAA/AAA 2,000,000 1,529,110
------------------------------------------------------------------------------------------------------
Lansing, Michigan Sewer Disposal Revenue
Refunding Bonds, FGIC Insured, 5.85%, 5/1/14 Aaa/AAA/AAA 1,000,000 946,479
------------------------------------------------------------------------------------------------------
Michigan Municipal Board Authority Revenue
Bonds, Local Government, Group 19, AMBAC
Insured, 7.50%, 11/1/09 Aaa/AAA/AAA 250,000 272,448
-----------
2,748,037
</TABLE>
5 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 6
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NEBRASKA--0.7% Nebraska Investment Finance Authority Hospital
Revenue Bonds, Nebraska Methodist Health System,
MBIA Insured, 7%, 3/1/06 Aaa/AAA $ 500,000 $ 532,776
- -------------------------------------------------------------------------------------------------------------------------------
NEVADA--4.1% Clark County, Nevada School District General
Obligation Bonds, Series B, MBIA Insured, 6.75%,
3/1/08 Aaa/AAA 2,000,000 2,080,590
------------------------------------------------------------------------------------------------------
Humboldt County, Nevada Pollution Control
Revenue Bonds, Idaho Power Co. Project,
AMBAC Insured, 8.30%, 12/20/14 Aaa/AAA/AAA 1,000,000 1,159,136
-----------
3,239,726
- -------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE--0.6% New Hampshire Turnpike System Revenue
Refunding Bonds, Series A, FGIC Insured,
6.75%, 11/1/11 Aaa/AAA/AAA 500,000 523,153
- -------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY--4.0% Bergen County, New Jersey Utilities Authority
Water Pollution Control Revenue Bonds, Series A,
FGIC Insured, 6.50%, 12/15/12 Aaa/AAA/AAA 500,000 509,664
------------------------------------------------------------------------------------------------------
East Orange, New Jersey General Obligation Bonds,
FSA Insured, 8.40%, 8/1/06 Aaa/AAA 1,000,000 1,216,439
------------------------------------------------------------------------------------------------------
Union City, New Jersey General Obligation Bonds,
FSA Insured, 6.375%, 11/1/10 Aaa/AAA 1,435,000 1,471,293
-----------
3,197,396
- -------------------------------------------------------------------------------------------------------------------------------
NEW YORK--16.3% New York City Municipal Water Finance Authority
Revenue Refunding Bonds, Water and Sewer
System Project:
Series B, AMBAC Insured, 5.375%, 6/15/19 Aaa/AAA/AAA 1,805,000 1,559,581
Series B, MBIA Insured, 5.375%, 6/15/19 Aaa/AAA/A 1,000,000 861,840
Series F, AMBAC Insured, 5.50%, 6/15/11 Aaa/AAA/AAA 4,000,000 3,699,052
------------------------------------------------------------------------------------------------------
New York State Medical Care Facilities Finance
Agency Revenue Bonds, Mental Health Services
Facilities Improvement Project:
Prerefunded, Series A, MBIA Insured, 7.75%,
8/15/10 Aaa/AAA 235,000 267,402
Prerefunded, Series B, CGIC Insured, 7.875%,
8/15/15 Baa1/AAA/AAA 500,000 560,836
Unrefunded Balance, MBIA Insured, 7.75%, 8/15/10 Aaa/AAA 370,000 408,317
------------------------------------------------------------------------------------------------------
New York State Urban Development Corp. Revenue
Refunding Bonds, Correctional Facilities Capital
Project, Series A, FSA Insured, 5.25%, 1/1/14 Aaa/AAA/A 4,115,000 3,570,433
------------------------------------------------------------------------------------------------------
Suffolk County, New York Industrial Development
Authority Revenue Bonds, Southwest Sewer
System, FGIC Insured, 6%, 2/1/07 Aaa/AAA/AAA 2,000,000 2,018,908
-----------
12,946,369
- -------------------------------------------------------------------------------------------------------------------------------
OHIO--1.8% Ohio Municipal Electric Generation Agency
Revenue Bonds, Joint Venture No. 5, AMBAC
Insured, 5.625%, 2/15/16 Aaa/AAA/AAA 1,000,000 909,746
------------------------------------------------------------------------------------------------------
Streetsboro, Ohio City School District General
Obligation Bonds, AMBAC Insured, 7.125%, 12/1/10 Aaa/AAA/AAA 500,000 546,489
-----------
1,456,235
</TABLE>
6 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 7
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OKLAHOMA--3.0% Grove, Oklahoma Municipal Services Authority
Utility and Sales Tax Revenue Bonds, Series 1991,
CGIC Insured, 7%, 2/1/16 Aaa/AAA $1,115,000 $1,157,569
------------------------------------------------------------------------------------------------------
Norman, Oklahoma Regional Hospital Authority
Revenue Bonds, MBIA Insured, 6.90%, 9/1/21 Aaa/AAA 500,000 516,755
------------------------------------------------------------------------------------------------------
Oklahoma Baptist University Authority Revenue
Bonds, FGIC Insured, 7.10%, 8/1/09 Aaa/AAA/AAA 150,000 159,075
------------------------------------------------------------------------------------------------------
Tulsa, Oklahoma Airports Improvement Trust
Consolidated General Revenue Bonds, MBIA
Insured, 7.50%, 6/1/08 Aaa/AAA 500,000 537,216
-----------
2,370,615
- -------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA--8.9% Allegheny County, Pennsylvania Hospital
Development Authority Revenue Bonds,
Presbyterian University Hospital, Prerefunded,
Series A, MBIA Insured, 7.60%, 3/1/08 Aaa/AAA 1,400,000 1,492,442
------------------------------------------------------------------------------------------------------
Berks County, Pennsylvania General
Obligation Bonds, FGIC Insured, 6.30%, 11/10/20 Aaa/AAA 2,000,000 2,060,100
------------------------------------------------------------------------------------------------------
Butler County, Pennsylvania Hospital Authority
Revenue Bonds, North Hills Passavant Hospital,
Series A, CGIC Insured, 7%, 6/1/22 Aaa/AAA 200,000 212,511
------------------------------------------------------------------------------------------------------
Pennsylvania State Higher Education
Assistance Agency Student Loan Residual
Interest Revenue Bonds, Series 1992B,
AMBAC Insured, 8.77%, 3/1/22(1) Aaa/AAA/AAA 1,250,000 1,075,997
------------------------------------------------------------------------------------------------------
Philadelphia, Pennsylvania Regional
Port Authority Lease Revenue Bonds,
MBIA Insured, 8.87%, 9/1/20(1) Aaa/AAA 1,900,000 1,735,538
------------------------------------------------------------------------------------------------------
Philadelphia, Pennsylvania School
District General Obligation Bonds,
Series A, MBIA Insured, 5.75%, 7/1/07 Aaa/AAA 500,000 489,787
-----------
7,066,375
- -------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA--1.1% Florence County, South Carolina School District
No. 003 Certificates of Participation, Series B,
CGIC Insured, 7%, 1/1/11 Aaa/AAA 310,000 321,890
------------------------------------------------------------------------------------------------------
Sumter County, South Carolina School District
No. 017, Certificates of Participation, Series A,
CGIC Insured, 7.125%, 1/1/11 Aaa/AAA 500,000 530,758
-----------
852,648
- -------------------------------------------------------------------------------------------------------------------------------
TEXAS--6.8% Austin, Texas Combined Utility Systems Revenue
Refunding Bonds, Series A, MBIA Insured, 0%,
11/15/09 Aaa/AAA 3,615,000 1,408,490
------------------------------------------------------------------------------------------------------
Dallas/Fort Worth, Texas Regional Airport Revenue
Bonds, FGIC Insured, 6.50%, 11/1/11 Aaa/AAA/AAA 1,600,000 1,620,928
------------------------------------------------------------------------------------------------------
Houston, Texas Certificates of Participation,
Water Conveyance System Project, Series J, AMBAC
Insured, 6.125%, 12/15/08 Aaa/AAA/AAA 2,345,000 2,366,923
-----------
5,396,341
</TABLE>
7 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 8
STATEMENTS OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
VIRGINIA--1.8% Norfolk, Virginia Water Revenue Bonds,
AMBAC Insured, 5.25%, 11/1/13 Aaa/AAA/AAA $1,000,000 $ 869,283
------------------------------------------------------------------------------------------------------
Roanoke, Virginia Industrial Development
Authority Hospital Revenue Bonds, Roanoke
Memorial Hospital Project-Carilion Health,
Prerefunded, MBIA Insured, 7.25%, 7/1/10 Aaa/AAA 500,000 556,202
-----------
1,425,485
- -------------------------------------------------------------------------------------------------------------------------------
WASHINGTON--1.0% Washington State Public Power Supply
System Revenue Refunding Bonds, Series A,
FGIC Insured, 0%, 7/1/09 Aaa/AAA/AAA 2,000,000 770,642
- -------------------------------------------------------------------------------------------------------------------------------
WISCONSIN--1.3% Wisconsin State Health & Educational
Facilities Authority Revenue Bonds:
Novus Health Group, Series B,
MBIA Insured, 6.75%, 12/15/20 Aaa/AAA 500,000 504,704
SSM Healthcare Projects, Prerefunded,
Series B, MBIA Insured, 7%, 6/1/20 Aaa/AAA 500,000 549,574
-----------
1,054,278
- -------------------------------------------------------------------------------------------------------------------------------
U.S. POSSESSIONS--2.4% Puerto Rico Commonwealth Linked Revenue
Bonds, MBIA/FSA Insured, 5.831%, 7/1/20 Aaa/AAA/AAA 2,000,000 1,890,478
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $80,017,715) 97.9% 77,734,323
- -------------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 2.1 1,629,144
--------- -----------
NET ASSETS 100.0% $79,363,467
========= ===========
</TABLE>
(1) Represents the current interest rate for a
variable rate bond. Variable rate bonds known as
"inverse floaters" pay interest at a rate that varies
inversely with short-term interest rates. As interest
rates rise, inverse floaters produce less current
income. Their price may be more volatile than the
price of a comparable fixed-rate security. See
accompanying Notes to Financial Statements.
8 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES September 30, 1994
<TABLE>
=========================================================================================================================
<S> <C> <C>
ASSETS Investments, at value (cost $80,017,715)--see accompanying statement $77,734,323
-------------------------------------------------------------------------------------------
Cash 16,208
-------------------------------------------------------------------------------------------
Receivables:
Interest 1,218,784
Shares of beneficial interest sold 898,539
-------------------------------------------------------------------------------------------
Other 6,071
------------
Total assets 79,873,925
=========================================================================================================================
LIABILITIES Payables and other liabilities:
Dividends 234,852
Shares of beneficial interest redeemed 164,218
Distribution and service plan fees--Note 4 48,163
Other 63,225
------------
Total liabilities 510,458
=========================================================================================================================
NET ASSETS $79,363,467
============
=========================================================================================================================
COMPOSITION OF Paid-in capital $82,436,070
NET ASSETS -------------------------------------------------------------------------------------------
Undistributed net investment income 20,250
-------------------------------------------------------------------------------------------
Accumulated net realized loss from investment transactions (809,461)
-------------------------------------------------------------------------------------------
Net unrealized depreciation on investments--Note 3 (2,283,392)
------------
Net assets $79,363,467
============
=========================================================================================================================
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on net assets
of $67,792,867 and 4,201,168 shares of beneficial interest outstanding) $16.14
Maximum offering price per share (net asset value plus sales charge
of 4.75% of offering price) $16.94
-------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $11,570,600 and 716,638 shares of beneficial interest
outstanding) $16.15
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 10
STATEMENT OF OPERATIONS For the Year Ended September 30, 1994
<TABLE>
=========================================================================================================================
<S> <C>
INVESTMENT INCOME Interest $ 4,780,017
=========================================================================================================================
EXPENSES Management fees--Note 4 342,465
-------------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A--Note 4 162,106
Class B--Note 4 92,013
-------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 81,961
Class B 13,464
-------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 85,934
-------------------------------------------------------------------------------------------
Shareholder reports 55,261
-------------------------------------------------------------------------------------------
Legal and auditing fees 12,000
-------------------------------------------------------------------------------------------
Custodian fees and expenses 5,321
-------------------------------------------------------------------------------------------
Trustees' fees and expenses 1,877
-------------------------------------------------------------------------------------------
Other 21,271
-----------
Total expenses 873,673
=========================================================================================================================
NET INVESTMENT INCOME 3,906,344
=========================================================================================================================
REALIZED AND UNREALIZED Net realized loss on investments (811,863)
LOSS ON INVESTMENTS -------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments (7,639,229)
-----------
Net realized and unrealized loss on investments (8,451,092)
=========================================================================================================================
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $(4,544,748)
===========
See accompanying Notes to Financial Statements.
</TABLE>
10 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 11
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
1994 1993
===================================================================================================================================
<S> <C> <C> <C>
OPERATIONS Net investment income $ 3,906,344 $ 2,520,182
-----------------------------------------------------------------------------------------------------------
Net realized gain (loss) on investments (811,863) 242,996
-----------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments (7,639,229) 3,653,486
------------ ------------
Net increase (decrease) in net assets resulting from operations (4,544,748) 6,416,664
===================================================================================================================================
DIVIDENDS AND Dividends from net investment income:
DISTRIBUTIONS TO Class A ($.8620 and $.96 per share, respectively) (3,348,993) (2,518,298)
SHAREHOLDERS Class B ($.7310 and $.30 per share, respectively) (388,291) (38,890)
-----------------------------------------------------------------------------------------------------------
Dividends in excess of net investment income:
Class A ($.0282 per share) (109,723) --
Class B ($.0240 per share) (12,722) --
-----------------------------------------------------------------------------------------------------------
Distributions from net realized gain on investments:
Class A ($.0763 and $.18 per share, respectively) (279,752) (387,637)
Class B ($.0763 per share) (27,180) --
===================================================================================================================================
BENEFICIAL INTEREST Net increase in net assets resulting from Class A
TRANSACTIONS beneficial interest transactions--Note 2 13,295,652 25,043,911
-----------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from Class B
beneficial interest transactions--Note 2 7,516,981 4,995,749
===================================================================================================================================
NET ASSETS Total increase 12,101,224 33,511,499
-----------------------------------------------------------------------------------------------------------
Beginning of year 67,262,243 33,750,744
------------ ------------
End of year (including undistributed net investment
income of $20,250 and $64,446, respectively) $79,363,467 $67,262,243
============ ============
See accompanying Notes to Financial Statements.
</TABLE>
11 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 12
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------------------
YEAR ENDED
SEPTEMBER 30,
1994 1993 1992 1991 1990(3) 1989
===============================================================================================
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period $18.06 $16.92 $16.17 $15.16 $15.27 $14.96
- -----------------------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income .89 .93 .96 .92 .98 1.06
Net realized and
unrealized gain
(loss) on investments (1.84) 1.35 .73 1.01 (.11) .31
------ ----- ----- ----- ----- -----
Total income (loss) from
investment
operations (.95) 2.28 1.69 1.93 .87 1.37
- -----------------------------------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment income (.86) (.96) (.91) (.92) (.98) (1.06)
Dividends in excess
of net investment
income (.03) -- -- -- -- --
Distributions from net
realized gain on
investments (.08) (.18) (.03) -- -- --
------ ----- ----- ----- ----- -----
Total dividends and
distributions to
shareholders (.97) (1.14) (.94) (.92) (.98) (1.06)
- -----------------------------------------------------------------------------------------------
Net asset value,
end of period $16.14 $18.06 $16.92 $16.17 $15.16 $15.27
====== ====== ====== ====== ====== ======
===============================================================================================
TOTAL RETURN, AT
NET ASSET VALUE(4) (5.46)% 14.02% 10.74% 13.08% 5.81% 9.37%
===============================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $67,793 $62,158 $33,751 $23,791 $16,863 $13,105
- -----------------------------------------------------------------------------------------------
Average net assets
(in thousands) $66,953 $45,949 $27,811 $19,936 $15,145 $11,200
- -----------------------------------------------------------------------------------------------
Number of shares
outstanding
at end of period
(in thousands) 4,201 3,442 1,995 1,471 1,113 858
- -----------------------------------------------------------------------------------------------
Ratios to average net
assets:
Net investment income 5.23% 5.40% 5.81% 5.83% 6.43% 6.87%
Expenses, before voluntary
assumption by
the Manager 1.05% 1.18% 1.35% 1.60% 1.62% 2.04%
Expenses, net of voluntary
assumption by the Manager N/A 1.10% .95% .91% .62% .42%
- -------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 99% 7% 47% 67% 62% 142%
</TABLE>
<TABLE>
<CAPTION>
CLASS A CLASS B
------------------- ------------------------
YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPTEMBER 30,
1988 1987(2) 1994 1993(1)
==============================================================================
<S> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period $13.79 $16.00 $18.07 $17.33
- ------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income 1.07 .92 .77 .30
Net realized and
unrealized gain
(loss) on investments 1.17 (2.21) (1.86) .74
----- ----- ----- -----
Total income (loss) from
investment
operations 2.24 (1.29) (1.09) 1.04
- ------------------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment income (1.07) (.92) (.73) (.30)
Dividends in excess
of net
investment
income -- -- (.02) --
Distributions from net
realized gain on
investments -- -- (.08) --
----- ----- ----- -----
Total dividends and
distributions to
shareholders (1.07) (.92) (.83) (.30)
- ------------------------------------------------------------------------------
Net asset value,
end of period $14.96 $13.79 $16.15 $18.07
====== ====== ====== ======
==============================================================================
TOTAL RETURN, AT
NET ASSET VALUE(4) 16.67% (8.36)% (6.20)% 6.04%
==============================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $8,483 $5,449 $11,571 $5,104
- ------------------------------------------------------------------------------
Average net assets
(in thousands) $6,936 $5,435 $ 9,209 $2,298
- ------------------------------------------------------------------------------
Number of shares
outstanding
at end of period
(in thousands) 567 395 717 282
- ------------------------------------------------------------------------------
Ratios to average net
assets:
Net investment income 7.34% 6.69%(5) 4.43% 3.99%(5)
Expenses, before voluntary
assumption by
the Manager 2.50% 2.98%(5) 1.82% 1.96%(5)
Expenses, net of voluntary
assumption by the Manager .13% .34%(5) N/A N/A
- ------------------------------------------------------------------------------
Portfolio turnover rate(6) 141% 112% 99% 7%
</TABLE>
(1) For the period from May 3, 1993 (inception of offering) to September 30,
1993.
(2) For the period from November 11, 1986 (commencement of operations) to
September 30, 1987.
(3) On April 7, 1990, Oppenheimer Management Corporation became the investment
advisor to the Fund.
(4) Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, 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.
(5) Annualized.
(6) 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 year ended September 30, 1994 were $97,142,573 and $74,122,758,
respectively.
See accompanying Notes to Financial Statements.
12 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<S> <C>
===================================================================================================================================
1. SIGNIFICANT Oppenheimer Insured Tax-Exempt Bond Fund (the Fund) is a separate series of Oppenheimer Tax-Exempt
ACCOUNTING POLICIES Bond Fund, a diversified, open-end management investment company registered under the Investment
Company Act of 1940, as amended. The Fund's investment advisor is Oppenheimer Management Corporation
(the Manager). The Fund offers both Class A and Class B shares. Class A shares are sold with a front-
end sales charge. Class B shares may be subject to a contingent deferred sales charge. Both classes
of shares have identical rights to earnings, assets and voting privileges, except that each class has
its own distribution and/or service plan, expenses directly attributable to a particular class and
exclusive voting rights with respect to matters affecting a single class. 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. Long-term debt securities are valued by a portfolio pricing service approved by the Board of
Trustees. Long-term debt securities which cannot be valued by the approved portfolio pricing service
are valued by averaging the mean between the bid and asked prices obtained from two active market
makers in such securities. 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.
-------------------------------------------------------------------------------------------------------
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.
-------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. The Fund intends to declare dividends separately for Class A and
Class B shares from net investment income each day the New York Stock Exchange is open for business
and pay such dividends monthly. Distributions from net realized gains on investments, if any, will
be declared at least once each year.
-------------------------------------------------------------------------------------------------------
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective October 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 September 30, 1993, amounts have been reclassified to
reflect a decrease in paid-in capital of $2,641, a decrease in undistributed net investment income
of $55,349, and a decrease in undistributed capital loss on investments of $57,990. During the year
ended September 30, 1994, in accordance with Statement of Position 93-2, paid-in capital was
increased by $2,432, undistributed net investment income was decreased by $35,462 and undistributed
capital loss was decreased by $33,030.
-------------------------------------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the investments are purchased or sold
(trade date). Original issue discount on securities purchased is amortized over the life of the
respective securities, in accordance with federal income tax requirements. Realized gains and losses
on investments and unrealized appreciation and depreciation are determined on an identified cost
basis, which is the same basis used for federal income tax purposes. For bonds acquired after April
30, 1993, accrued market discount is recognized at maturity or disposition as taxable ordinary
income. Taxable ordinary income is realized to the extent of the lesser of gain or accrued market
discount.
</TABLE>
13 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS (Continued)
<TABLE>
<S> <C>
==========================================================================================================================
2. SHARES OF The Fund has authorized an unlimited number of no par value shares of beneficial interest of
BENEFICIAL INTEREST each class. Transactions in shares of beneficial interest were as follows:
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30, 1994 YEAR ENDED SEPTEMBER 30, 1993(1)
----------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 1,358,474 $23,400,749 1,716,581 $29,729,902
Dividends and
distributions
reinvested 164,884 2,823,809 122,875 2,119,692
Redeemed (763,948) (12,928,906) (392,790) (6,805,683)
--------- ----------- --------- -----------
Net increase 759,410 $13,295,652 1,446,666 $25,043,911
========= =========== ========= ===========
----------------------------------------------------------------------------------------------
Class B:
Sold 503,586 $ 8,682,918 281,944 $ 4,987,254
Dividends and
distributions
reinvested 15,806 267,832 1,056 18,887
Redeemed (85,174) (1,433,769) (580) (10,392)
--------- ----------- --------- -----------
Net increase 434,218 $ 7,516,981 282,420 $ 4,995,749
========= =========== ========= ===========
</TABLE>
(1) For the year ended September 30, 1993 for Class
A shares and for the period from May 3, 1993
(inception of offering) to September 30, 1993 for
Class B shares.
<TABLE>
==========================================================================================================================
<S> <C>
3. UNREALIZED GAINS AND At September 30, 1994, net unrealized depreciation on investments of $2,283,392 was composed
LOSSES ON INVESTMENTS of gross appreciation of $987,289, and gross depreciation of $3,270,681.
==========================================================================================================================
4. MANAGEMENT FEES Management fees paid to the Manager were in accordance with the investment advisory agreement
AND OTHER TRANSACTIONS with the Fund, which provides for an annual fee of .45% on the first $100 million of net
WITH AFFILIATES assets, .40% on the next $150 million, .375% on the next $250 million and .35% on net assets
in excess of $500 million. The Manager has agreed to assume Fund expenses (with specified
exceptions) in excess of the most stringent applicable regulatory limit on Fund expenses.
The Manager acts as the accounting agent for the Fund at an annual fee of $12,000,
plus out-of-pocket costs and expenses reasonably incurred.
For the year ended September 30, 1994, commissions (sales charges paid by investors)
on sales of Class A shares totaled $376,541, of which $92,979 was retained by Oppenheimer
Funds Distributor, Inc. (OFDI), a subsidiary of the Manager, as general distributor, and by
an affiliated broker/dealer. During the year ended September 30, 1994, OFDI received
contingent deferred sales charges of $19,475 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, each class may expend up to .25% of its 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, including amounts paid to brokers,
dealers, banks and other financial 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 September 30, 1994, OFDI paid $5,920 and $125, respectively, to an
affiliated broker/dealer as reimbursement for Class A and Class B personal service and
maintenance expenses and retained $89,853 as reimbursement for Class B sales commissions and
service fee advances, as well as financing costs.
</TABLE>
14 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 15
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders of Oppenheimer Insured Tax-Exempt Bond
Fund:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Oppenheimer Insured Tax-Exempt Bond Fund as of
September 30, 1994, the related statement of operations for the year then
ended, the statements of changes in net assets for the years ended September
30, 1994 and 1993 and the financial highlights for the period October 1, 1989
to September 30, 1994. 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. The financial highlights (except for total return) for the period
November 11, 1986 (commencement of operations) to September 30, 1989 were
audited by other auditors, whose report dated November 2, 1989 expressed an
unqualified opinion on those financial highlights.
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 also includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned
at September 30, 1994 by correspondence with the custodian. 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, such financial statements and financial highlights
present fairly, in all material respects, the financial position of Oppenheimer
Insured Tax-Exempt Bond Fund at September 30, 1994, the results of its
operations, the changes in its net assets, and the financial highlights for the
respective stated periods, in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Denver, Colorado
October 21, 1994
15 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 16
FEDERAL INCOME TAX INFORMATION (Unaudited)
In early 1995, shareholders will receive information regarding all dividends
and distributions paid to them by the Fund during 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 $.0763 per share, paid on December 10, 1993, 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). Both short-term and long-term capital
gain distributions are subject to federal, state and local taxes.
None of the dividends paid by the Fund during the fiscal year ended
September 30, 1994 is eligible for the corporate dividend-received deduction.
The dividends were derived from interest on municipal bonds and are not subject
to federal income tax. To the extent a shareholder is subject to any state or
local tax laws, some or all of the dividends received may be taxable.
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 that 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.
16 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 17
OPPENHEIMER INSURED TAX-EXEMPT BOND FUND
A Series Of Oppenheimer Tax-Exempt Bond Fund
<TABLE>
<S> <C>
===================================================================================================================================
OFFICERS AND TRUSTEES James C. Swain, Chairman and Chief Executive Officer
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee and President
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
Andrew J. Donohue, Vice President
Caryn R. Halbrecht, Vice President
Robert E. Patterson, Vice President
George C. Bowen, Vice President, Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
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 Citibank, N.A.
PORTFOLIO SECURITIES
===================================================================================================================================
INDEPENDENT AUDITORS Deloitte & Touche LLP
===================================================================================================================================
LEGAL COUNSEL Myer, Swanson & Adams, P.C.
This is a copy of a report to shareholders of Oppenheimer Insured Tax-Exempt
Bond Fund. This report must be preceded or accompanied by a Prospectus of Oppenheimer
Insured Tax-Exempt Bond Fund. For material information concerning the Fund, see the Prospectus.
</TABLE>
17 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 18
OPPENHEIMERFUNDS FAMILY
<TABLE>
<S> <C>
===================================================================================================================================
OppenheimerFunds offers over 35 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 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 shares 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.
===================================================================================================================================
STOCK FUNDS Discovery Fund Global Fund
Global Emerging Growth Fund(2) Oppenheimer Fund
Time Fund Value Stock Fund
Target Fund Gold & Special Minerals Fund
Growth Fund(3)
===================================================================================================================================
STOCK & 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
Strategic Investment Grade Bond Fund
===================================================================================================================================
TAX-EXEMPT FUNDS New York Tax-Exempt Fund(4) New Jersey Tax-Exempt Fund(4)
California Tax-Exempt Fund(4) Tax-Free Bond Fund
Pennsylvania Tax-Exempt Fund(4) Insured Tax-Exempt Bond Fund
Florida Tax-Exempt Fund(4) Intermediate Tax-Exempt Bond Fund
===================================================================================================================================
MONEY MARKET FUNDS Money Market Fund Cash Reserves
(1) The fee is waived for PhoneLink exchanges between existing accounts.
Exchange privileges are subject to change or termination.
(2) Formerly Oppenheimer Global Bio-Tech Fund and Oppenheimer Global
Environment Fund.
(3) Formerly Special Fund.
(4) Available only to residents of those states.
OppenheimerFunds are distributed by Oppenheimer Funds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203. (C) Copyright 1994 Oppenheimer
Management Corporation. All rights reserved.
</TABLE>
18 Oppenheimer Insured Tax-Exempt Bond Fund
<PAGE> 19
'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.
Make account transactions with a
Customer Service Representative.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
Get automated information or
make automated transcactions.
24 hours a day, 7 days a week.
Service for the hearing impaired.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
Hear timely and insightful
messages on the economy and
issues that affect your finances.
24 hours a day, 7 days a week.
"Just as OppenheimerFunds offers over 35 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. [Photograph of
"When you want to make account Barbara Hennigar
transactions, it's easy for you to redeem Chief Executive Officer
shares, exchange shares, or conduct Oppenheimer Shareholder
AccountLink transactions, simply by calling Services.]
our Telephone Transactions number.
"And for added convenience,
OppenheimerFunds' Phone Link, 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
1 9 9 3 course, PhoneLink will always give you the option to
AWARD of speak with a Customer Service Representative during the hours
EXCELLENCE shown to the left.
[LOGO] icsa "When you invest in OppenheimerFunds, you know
- ------------ you'll receive a high level of customer service. The
International International Customer Service Association knows it, too, as
Customer it awarded Oppenheimer Shareholder Services a 1993 Award of
Service Excellence for consistenly demonstrating superior customer
Association service.
"Whatever your needs, we're ready to assist you."
[Logo] OppenheimerFunds(R) -------------------
Oppenheimer Funds Distributor, Inc. Bulk Rate
P.O. Box 5270 U.S. Postage
Denver, CO 80217-5270 PAID
Permit No. 377
Hackensack, NJ
--------------------
