[COVER PAGE]
1996 ANNUAL REPORT
CENTENNIAL
AMERICA FUND, L.P.
- ---------------------------------------
December 31, 1996
RA0870.001.1296
<PAGE>
DEAR SHAREHOLDER,
The second half of 1996 was a period of uncertainty in the fixed income markets,
largely due to investor fears of rapid economic growth and accelerating
inflation. The 30-year Treasury rates rose above 7% in the second quarter and
remained relatively unchanged until the end of the third quarter. That's when
the negative investor sentiment that led to the market downturn in June and July
began to subside.
The swing away from inflationary fears seemed complete in October with the
release of economic indicators showing a firm dollar, low inflation and slow
growth. When the Federal Reserve responded to these indicators with another
decision to leave rates alone, it appeared that concerns about rapid growth had
been overblown, and interest rates fell in response. The status quo outcome of
the presidential election also aided the decline in rates, and the bond market
experienced one of the most substantial post-election rallies in recent history.
With continued, sustainable non-inflationary growth of around 2% to 2.5%, and
long-term rates at their lowest levels since April, the economy seems to have
settled into a comfortable path of neither too little nor too much growth.
This decline in long-term Treasury rates over the past few months has caused the
return on money market instruments to decline marginally, but the positive
inflationary situation has helped to keep yields relatively strong. Money market
fund yields are usually between three and five percentage points less than the
yields on long-term bonds, and typically one percentage point above inflation.
Assuming that the annual inflation rate is about 2.5%, money market yields would
normally be about 3.5%, while longer-term yields might be as high as 5.5%.
However, the difference between money market yields and inflation is currently
greater than this formula would suggest. Part of the reason for this
irregularity is the successful way in which the Federal Reserve Board has fought
inflation.
As we head into 1997, money market funds continue to be a highly liquid
opportunity to earn steady income while protecting principal. This year, money
market funds turned out to be a good investment choice for the income-oriented
investor.
For the twelve months ended December 31, 1996, the Fund's compounded annualized
yield was 4.62%. Without compounding, the corresponding yield was 4.52%. The
seven-day annualized yields with and without compounding on December 31, 1996
were 4.66% and 4.56%, respectively.(1)
<PAGE>
An investment in the Fund is neither insured nor guaranteed by the U.S.
government, and there is no assurance that the Fund will maintain a stable $1.00
share price in the future.
Thank you for your confidence in Centennial America Fund, L.P. We look forward
to helping you reach your investment goals in the future.
Sincerely,
/S/James C. Swain
James C. Swain
Chairman
Centennial America Fund, L.P.
/S/Bridget A. Macaskill
Bridget A. Macaskill
President
Centennial America Fund, L.P.
January 22, 1997
1. Compounded yields assume reinvestment of dividends. Past performance is not
indicative of future results.
<PAGE>
<TABLE>
<CAPTION>
==========================================
STATEMENT OF INVESTMENTS DECEMBER 31, 1996
Centennial America Fund, L.P.
FACE VALUE
AMOUNT SEE NOTE 1
========================================================================================================================
U.S. GOVERNMENT AGENCIES - 97.4%
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Federal Home Loan Bank:
5.27%, 1/2/97 $1,000,000 $ 999,854
5.38%, 1/15/97 430,000 429,100
5.45%, 1/9/97 525,000 524,364
5.48%, 1/23/97 890,000 887,019
-------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.:
5.21%, 2/20/97 940,000 933,198
5.23%, 2/3/97 800,000 796,172
5.25%, 1/30/97 500,000 497,885
5.29%, 1/14/97 410,000 409,215
5.37%, 3/31/97 400,000 394,690
5.38%, 3/21/97 323,000 319,190
5.40%, 1/17/97 1,000,000 997,600
5.45%, 1/15/97 500,000 498,940
5.46%, 1/30/97 1,000,000 995,602
5.50%, 1/21/97 958,000 955,073
5.60%, 1/16/97 625,000 623,542
5.70%, 1/2/97 3,000,000 2,999,458
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Federal National Mortgage Assn.:
5.18%, 5/2/97 700,000 687,813
5.22%, 3/17/97 500,000 494,563
5.22%, 3/6/97 195,000 193,190
5.30%, 3/13/97 1,000,000 989,547
5.50%, 1/13/97 900,000 898,350
-------------------------------------------------------------------------------------------------------------
Student Loan Marketing Assn., guaranteeing commercial
paper of:
New Hampshire Higher Education Loan Corp. Commercial
Paper Nts., Series 1995A, 5.40%, 1/17/97 900,000 897,840
Secondary Market Services, Inc. Education Loan
Revenue Nts., Series 1995A, 5.28%, 1/6/97 753,000 752,448
------------
Total U.S. Government Agencies (Cost $18,174,653) 18,174,653
========================================================================================================================
REPURCHASE AGREEMENT - 1.6%
- ------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with Goldman, Sachs & Co., 6.52%, dated
12/31/96, to be repurchased at $300,109 on 1/2/97, collateralized by
U.S. Treasury Nts., 7.875%, 11/15/04,
with a value of $306,094 (Cost $300,000) 300,000 300,000
-------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE 99.0% 18,474,653
-------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 1.0 186,744
------- ------------
NET ASSETS 100.0% $18,661,397
======= ============
</TABLE>
See accompanying Notes to Financial Statements.
4
<PAGE>
<TABLE>
<CAPTION>
=====================================================
STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 1996
Centennial America Fund, L.P.
========================================================================================================================
<S> <C> <C>
ASSETS Investments, at value - see accompanying statement $18,474,653
----------------------------------------------------------------------------------------------
Cash 12,066
----------------------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 434,099
Interest 54
----------------------------------------------------------------------------------------------
Other 5,248
------------
Total assets 18,926,120
========================================================================================================================
LIABILITIES Payables and other liabilities:
Shares of beneficial interest redeemed 239,338
Service plan fees 8,385
Shareholder reports 4,636
Dividends 1,712
Other 10,652
------------
Total liabilities 264,723
========================================================================================================================
NET ASSETS $18,661,397
============
========================================================================================================================
COMPOSITION OF Paid-in capital - applicable to 18,661,397 shares of beneficial
NET ASSETS interest outstanding $18,661,397
============
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $1.00
======
</TABLE>
See accompanying Notes to Financial Statements.
5
<PAGE>
<TABLE>
<CAPTION>
==========================================
STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1996
Centennial America Fund, L.P.
========================================================================================================================
<S> <C> <C>
INVESTMENT INCOME Interest $ 914,907
========================================================================================================================
EXPENSES Management fees - Note 3 76,514
----------------------------------------------------------------------------------------------
Service plan fees - Note 3 32,946
----------------------------------------------------------------------------------------------
Shareholder reports 12,293
----------------------------------------------------------------------------------------------
Legal and auditing fees 6,996
----------------------------------------------------------------------------------------------
Registration and filing fees 4,884
----------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees - Note 3 4,861
----------------------------------------------------------------------------------------------
Custodian fees and expenses 3,315
----------------------------------------------------------------------------------------------
Managing General Partners' fees and expenses 2,110
----------------------------------------------------------------------------------------------
Insurance expenses 1,569
----------------------------------------------------------------------------------------------
Other 444
------------
Total expenses 145,932
========================================================================================================================
NET INVESTMENT INCOME 768,975
========================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 768,975
============
</TABLE>
<TABLE>
<CAPTION>
===================================
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED DECEMBER 31,
1996 1995
========================================================================================================================
<S> <C> <C> <C>
OPERATIONS Net investment income $ 768,975 $ 350,917
----------------------------------------------------------------------------------------------
Net realized gain -- 8,197
------------------------------
Net increase in net assets resulting from operations 768,975 359,114
========================================================================================================================
DIVIDENDS AND
DISTRIBUTIONS
TO SHAREHOLDERS (777,172) (350,917)
========================================================================================================================
BENEFICIAL INTEREST Net increase in net assets resulting from
TRANSACTIONS beneficial interest transactions - Note 2 7,567,914 4,892,850
========================================================================================================================
NET ASSETS Total increase 7,559,717 4,901,047
----------------------------------------------------------------------------------------------
Beginning of period 11,101,680 6,200,633
------------------------------
End of period $18,661,397 $11,101,680
==============================
</TABLE>
See accompanying Notes to Financial Statements.
6
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
Centennial America Fund, L.P.
Year Ended December 31,
1996 1995 1994 1993 1992
================================================================================================================================
PER SHARE OPERATING DATA:
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------------------------------------------------------------
Income from investment operations - net
investment income and net realized gain .05 .04 .03 .02 .03
Dividends and distributions to shareholders (.05) (.04) (.03) (.02) (.03)
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
===========================================================================
================================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(1) 4.69% 4.56% 2.91% 2.23% 3.92%
================================================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $18,661 $11,102 $6,201 $4,349 $5,253
- --------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $16,998 $ 7,862 $5,693 $4,780 $5,323
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.52% 4.48% 2.89% 2.22% 3.64%
Expenses, before voluntary reimbursement by
the Manager 0.86% 1.48% 1.47% 1.34% 1.86%
Expenses, net of voluntary reimbursement by
the Manager N/A N/A N/A 1.13% 0.60%
</TABLE>
1. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends 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
reflect changes in net investment income only.
See accompanying Notes to Financial Statements.
7
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Centennial America Fund, L.P.
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial America Fund, L.P. (the Fund) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Fund's investment objective is to seek as high a level
of current income as is consistent with the preservation of capital and the
maintenance of liquidity. The Fund is organized as a limited partnership and
issues one class of shares, in the form of limited partnership interests. The
Fund's investment adviser is OppenheimerFunds, Inc. (the Manager). The following
is a summary of significant accounting policies consistently followed by the
Fund.
INVESTMENT VALUATION. Portfolio securities are valued on the basis of amortized
cost, which approximates market value.
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 limited partnerships. As a limited
partnership, the Fund is not subject to U.S. federal income tax, and the
character of the income earned and capital gains or losses realized by the Fund
flows directly through to shareholders. Therefore, no federal income or excise
tax provision is required.
DISTRIBUTIONS TO SHAREHOLDERS. The Fund intends to declare dividends from net
investment income each day the New York Stock Exchange is open for business and
pay such dividends monthly. To effect its policy of maintaining a net asset
value of $1.00 per share, the Fund may withhold dividends or make distributions
of net realized gains.
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Realized gains and losses on investments 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>
YEAR ENDED DECEMBER 31, 1996 YEAR ENDED DECEMBER 31, 1995
-------------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
<S> <C> <C> <C> <C>
Sold 51,127,626 $51,127,626 32,857,284 $32,857,284
Dividends and distributions
reinvested 749,505 749,505 326,936 326,936
Redeemed (44,309,217) (44,309,217) (28,291,370) (28,291,370)
------------ ------------ ------------ ------------
Net increase 7,567,914 $ 7,567,914 4,892,850 $ 4,892,850
============ ============ ============ ============
</TABLE>
8
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
Centennial America Fund, L.P.
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of 0.45% on
the first $500 million of net assets and 0.40% on net assets in excess of $500
million. The Manager has agreed to reimburse the Fund if aggregate expenses
(with specified exceptions) exceed the most stringent applicable regulatory
limit on Fund expenses.
Shareholder Services, Inc. (SSI), a subsidiary of the Manager, is the transfer
and shareholder servicing agent for the Fund, and for other registered
investment companies. SSI's total costs of providing such services are allocated
ratably to these companies.
Under an approved plan of distribution, the Fund expends 0.20% of its net assets
annually to reimburse Centennial Asset Management Corporation, a subsidiary of
the Manager, for costs incurred in distributing shares of the Fund, including
amounts paid to brokers, dealers, banks and other institutions.
9
<PAGE>
INDEPENDENT AUDITORS' REPORT
Centennial America Fund, L.P.
The Managing General Partners and Shareholders of
Centennial America Fund, L.P.:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Centennial America Fund, L.P. as of December
31, 1996, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended December 31, 1996 and
1995 and the financial highlights for the period January 1, 1992 to December 31,
1996. These financial statements and financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at December
31, 1996 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 Centennial America
Fund, L.P. at December 31, 1996, 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
January 22, 1997
10
<PAGE>
FEDERAL INCOME TAX INFORMATION (Unaudited)
Centennial America Fund, L.P.
In early 1997 shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1996. Regulations of
the U.S. Treasury Department require the Fund to report this information to the
Internal Revenue Service.
None of the dividends paid by the Fund during the fiscal year ended December 31,
1996 are eligible for the corporate dividend-received deduction.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax adviser for specific guidance.
11
<PAGE>
CENTENNIAL AMERICA FUND, L.P.
OFFICERS AND MANAGING GENERAL PARTNERS
James C. Swain, Managing General Partner and Chairman
Bridget A. Macaskill, President
Robert G. Avis, Managing General Partner
William A. Baker, Managing General Partner
Charles Conrad, Jr., Managing General Partner
Raymond J. Kalinowski, Managing General Partner
C. Howard Kast, Managing General Partner
Robert M. Kirchner, Managing General Partner
Ned M. Steel, Managing General Partner
George C. Bowen, Vice President, Treasurer and Assistant Secretary
Andrew J. Donohue, Vice President and Secretary
Dorothy G. Warmack, Vice President
Carol E. Wolf, Vice President
Arthur J. Zimmer, Vice President
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
INVESTMENT ADVISER
OppenheimerFunds, Inc.
DISTRIBUTOR
Centennial Asset Management Corporation
SUB-DISTRIBUTOR
OppenheimerFunds Distributor, Inc.
TRANSFER AND SHAREHOLDER SERVICING AGENT
Shareholder Services, Inc.
CUSTODIAN OF PORTFOLIO SECURITIES
Citibank, N.A.
INDEPENDENT AUDITORS
Deloitte & Touche LLP
LEGAL COUNSEL
Myer, Swanson, Adams & Wolf, P.C.
This is a copy of a report to shareholders of Centennial America Fund, L.P. This
report must be preceded or accompanied by a Prospectus of Centennial America
Fund, L.P. For material information concerning the Fund, see the Prospectus.
For shareholder servicing call:
1-800-525-9310 (in U.S.)
303-671-3200 (outside U.S.)
Or write:
Shareholder Services, Inc.
P.O. Box 5143
Denver, CO 80217-5143
12
