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OPPENHEIMER QUEST GROWTH & INCOME VALUE FUND
Semiannual Report April 30, 1997
[LOGO]
OppenheimerFunds(SM)
THE RIGHT WAY TO INVEST
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This Fund is for people who want their money to grow over time, and want income for today's needs.
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How Your Fund is Managed
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By investing in a diversified mix of what the provide capital growth and may also provide
Fund believes are undervalued stocks of well- income. The Fund's diversified investment
established companies and bonds, Oppenheimer strategy offers you the potential for growth
Quest Growth & Income Value Fund seeks to with less risk.
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Performance
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Total returns for the six months ended 4/30/97 For Class B shares, average annual total returns
for Class A, B, and C shares were 5.78%, 5.51% for the 1-year period ended 3/31/97 and from
and 5.46%, respectively, without deducting inception on 9/1/93 were 6.98% and 12.66%,
sales charges.(1) respectively. For Class C shares, average annual
total returns for the 1-year period ended 3/31/97
Your Fund's average annual total returns and from inception on 9/1/93 were 10.82%
for Class A shares for the 1- and 5-year periods and 13.11%, respectively.(2)
ended 3/31/97 and from inception on 11/1/91
were 5.97%, 11.83% and 11.64%, respectively.
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Outlook
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"We are very optimistic about the Fund going under recent pricing pressures but we
forward. Many of the Fund's holdings have been believe they are poised to rebound."
COLIN GLINSMAN, PORTFOLIO MANAGER
APRIL 30, 1997
Total returns include change in share price and reinvestment of dividends and capital gains distributions in a
hypothetical investment for the periods shown. IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF 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. The Fund's Sub-adviser is OpCap Advisors (formerly Quest for Value
Advisors, the Fund's Adviser until 11/22/95).
(1) Includes change in net asset value per share without deducting any sales charges. Such performance is
not annualized and would have been lower if sales charges were taken into account.
(2) Class A returns include the current maximum initial sales charge of 5.75%. Class A shares were first
publicly offered on 11/1/91. The Fund's maximum sales charge rate for Class A shares was lower prior to
11/22/95, so actual results would have been greater. Class B returns include the applicable contingent
deferred sales charge of 5% (1-year) and 3% (since inception). Class C returns include the 1% contingent
deferred sales charge for the 1-year result. An explanation of the different total returns is in the Fund's
prospectus. Class B and C shares are subject to an annual 0.75% asset-based sales charge and Class A shares
are subject to an annual 0.15% asset-based sales charge.
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2 Oppenheimer Quest Growth & Income Value Fund
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Dear Shareholder,
[photo]
Bridget A. Macaskill So far, 1997 has brought the volatility we anticipated in the equity market. April saw a 9% decline,
President but it was followed by an even larger rebound. Despite this volatility, we remain optimistic about the
Oppenheimer Quest rest of the year. On the one hand, the equity market is backed by solid economic fundamentals that
Growth & Income should continue for the near future. On the other hand, Value Fund the ups and downs of the business
Value Fund cycle are a reality, and at some point, possibly this year, we expect that the economy will move into
a phase of slower growth.
On a positive note, the economy has been expanding slowly but steadily. Interest rates are still
relatively low, despite the Federal Reserve's recent increase in short-term rates. Low interest rates
translate into reduced borrowing rates for companies, which use these savings to improve productivity
through new efficiency-enhancing technologies. Higher productivity translates into lower production
costs, which in turn results in higher profits.
In addition, inflation is at its lowest level in three decades. While it's true that an increase
in interest rates often indicates an accelerating economy, the Federal Reserve has been quick to
acknowledge that inflation and growth are under control. In fact, they've labeled the recent move as a
"pre-emptive" act to keep inflation low and extend the economy's healthy growth cycle.
Despite this good news, we are realistic about the future of the equity market. During 1996, most
market gains came from a very select group of about 50-100 large-capitalization stocks. The broader
market, including small- and mid-size companies, actually delivered mixed results for the past year.
Many large-company stocks are becoming overvalued, or expensive in price, and market buyers will
reach a point when they are no longer willing to pay high premiums for them. This may result in a
correction, unless investors turn to the many small- and mid-cap stocks that are relatively
undervalued. There is plenty of room for growth in these areas, and we expect to see these stocks
participating in the market during 1997.
In this uncertain period, selectivity will be our key to maintaining an effective portfolio. It
will be important to base stock choices on the individual merits of companies, such as strong
management, fundamental business policies, long-term future prospects and price. For you, the
investor, maintaining a long-term investment horizon is essential. Short-term swings will inevitably
occur, but the market's long-term trend has been to move higher and higher.
Your portfolio managers discuss the outlook for your Fund in light of these broad issues on the
following pages. Thank you for your confidence in OppenheimerFunds, THE RIGHT WAY TO INVEST. We look
forward to helping you reach your investment goals in the future.
/s/ Bridget A. Macaskill
Bridget A. Macaskill
May 21,1997
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3 Oppenheimer Quest Growth & Income Value Fund
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Colin Glinsman
Portfolio Manager Q + A
An interview with your Fund's managers.
HOW HAS THE FUND PERFORMED OVER THE PAST SIX MONTHS?
Oppenheimer Quest Growth & Income Value Fund performed moderately over the period. While the stock
holdings performed very well, the fixed income portion reported modest returns, in line with the bond
market as a whole. As a result, total return without deducting sales charges, for the Fund's Class A
shares was 5.78% for the six-month period ended April 30, 1997.(1)
WHAT CHARACTERISTICS DO YOU LOOK FOR WHEN EVALUATING STOCKS?
In this Fund, we look for companies that have three basic traits. First, the businesses we select
must have a competitive advantage versus other companies within their industry, a benefit that can
allow them to realize a high return on invested capital. Second, we look for companies with strong
management teams that are focused on working hard for the shareholders by implementing procedures that
will improve the stock prices, such as paying down debt, buying back stock and paying dividends. And
third, we look for stocks that can be purchased at advantageous prices.
WHAT INVESTMENTS MADE POSITIVE CONTRIBUTIONS TO PERFORMANCE OVER THE PERIOD?
Tenet Healthcare, an operator of hospitals, was a strong performer during the period. Tenet's
strength lies in its ability to acquire distressed hospitals -- particularly in areas where it can buy
several and gain a large market share -- and improve their operations. Wells Fargo & Co., a banking
concern headquartered in California, was able to dramatically reduce its operating expenses. In
addition, it has instituted a distribution channel for small full-service banking by setting up
branches in local supermarket chains.
Another strong performer was ACE Ltd., an insurance carrier that writes specialty lines of
coverage such as excess liability and catastrophic property reinsurance. They were able to keep
expenses low by operating from Bermuda, a country with low overhead that has recently replaced London
as the "hub" of the insurance industry.(2)
WERE THERE ANY INVESTMENTS THAT DIDN'T PERFORM AS WELL AS EXPECTED?
Tele-Communications, Inc., a cable-television distribution firm, proved a disappointment. The company
has experienced operating shortfalls, which resulted in productivity problems and compounded an
already high level of debt. However, new management is in place, and we expect to see a turnaround in
the near future. Another holding, a consumer software company, underperformed due to weaker demand for
software products.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We are very optimistic about the Fund going forward. Many of the Fund's holdings have been under
recent pricing pressures but we believe they are poised to rebound and have the potential for very
positive long-term performance. On the other hand, if the stock market continues to experience
volatility, investors may be inclined to shift some of their assets into fixed income products, which
could improve the condition of the bond market.
(1) Includes change in net asset value per share without deducting any sales charges. Such
performance is not annualized and would have been lower if sales charges were taken into account.
(2) The Fund's portfolio is subject to change.
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4 Oppenheimer Quest Growth & Income Value Fund
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STATEMENT OF INVESTMENTS April 30, 1997 (Unaudited)
FACE MARKET VALUE
AMOUNT SEE NOTE 1
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SHORT-TERM NOTES - 0.7%
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American Express Credit Corp., 5.42%, 5/7/97(1) $ 254,000 $ 253,771
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General Electric Capital Corp., 5.55%, 5/1/97(1) 300,000 300,000
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Total Short-Term Notes (Cost $553,771) 553,771
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NON-CONVERTIBLE CORPORATE BONDS
AND NOTES - 36.0%
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CONSUMER CYCLICALS - 11.0%
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MEDIA - 11.0%
Comcast Corp., 10.625% Sr. Sub. Debs., 7/15/12 2,500,000 2,793,750
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News America Holdings, Inc., 8.25% Bonds, 10/17/2096 3,000,000 2,857,761
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Time Warner, Inc., 8.05% Debs., 1/15/16 2,000,000 1,935,426
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Time Warner, Inc., 9.125% Debs., 1/15/13 500,000 538,837
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8,125,774
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CONSUMER NON-CYCLICALS - 10.1%
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BEVERAGES - 3.4% Coca-Cola Co., 7.375% Debs., 7/29/2093 2,570,000 2,516,703
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HEALTHCARE/SUPPLIES
& SERVICES - 3.4% Tenet Healthcare Corp., 8.625% Sr. Unsec. Nts., 12/1/03 2,500,000 2,550,000
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HOUSEHOLD GOODS - 3.3% Playtex Family Products Corp., 9% Sr. Sub. Nts., 12/15/03 2,500,000 2,468,750
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ENERGY - 4.2%
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ENERGY SERVICES &
PRODUCERS - 4.2% Triton Energy Ltd., 9.25% Sr. Nts., 4/15/05 3,000,000 3,088,620
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FINANCIAL - 4.1%
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BANKS - 4.1% NationsBank Corp., 7.75% Sub. Nts., 8/15/15 1,000,000 1,006,660
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NationsBank Corp., 7.80% Sub. Nts., 9/15/16 2,000,000 2,013,372
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3,020,032
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TECHNOLOGY - 6.6%
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AEROSPACE/DEFENSE - 2.6% Northrop Grumman Corp., 7.75% Nts., 3/1/16 2,000,000 1,969,676
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TELECOMMUNICATIONS-
TECHNOLOGY - 4.0%
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U.S. West Capital Funding, Inc., 7.95% Gtd. Bonds, 2/1/2097 3,000,000 2,936,621
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Total Non-Convertible Corporate Bonds and Notes (Cost $26,616,121) 26,676,176
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SHARES
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COMMON STOCKS - 63.3%
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CONSUMER CYCLICALS - 13.0%
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LEISURE & ENTERTAINMENT - 5.6% McDonald's Corp. 77,000 4,129,125
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MEDIA - 7.4%
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Tele-Communications, Inc. (New), TCI Group, Series A(2) 400,000 5,525,000
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5 Oppenheimer Quest Growth & Income Value Fund
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STATEMENT OF INVESTMENTS (Unaudited)(Continued)
MARKET VALUE
SHARES SEE NOTE 1
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CONSUMER NON-CYCLICALS - 3.4%
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HEALTHCARE/DRUGS - 1.8% Novartis AG, ADR 20,000 $ 1,318,006
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HEALTHCARE/SUPPLIES & SERVICES - 1.6%
Becton, Dickinson & Co. 26,000 1,196,000
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ENERGY - 3.3%
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OIL-INTEGRATED - 3.3% Chesapeake Energy Corp.(2) 160,000 2,420,000
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FINANCIAL - 13.8%
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BANKS - 3.0% Citicorp 8,000 901,000
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Wells Fargo & Co. 5,000 1,333,750
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2,234,750
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DIVERSIFIED FINANCIAL - 6.0% Countrywide Credit Industries, Inc. 50,000 1,356,250
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Federal Home Loan Mortgage Corp. 50,000 1,593,750
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United Asset Management Corp. 60,000 1,470,000
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4,420,000
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INSURANCE - 4.8% ACE Ltd. 45,000 2,700,000
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General Re Corp. 5,000 836,250
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3,536,250
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INDUSTRIAL - 3.7%
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MANUFACTURING - 3.7% Dover Corp. 20,000 1,060,000
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Grand Metropolitan plc, Sponsored ADR 50,245 1,720,891
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2,780,891
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TECHNOLOGY - 24.9%
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AEROSPACE/DEFENSE - 1.9% Lockheed Martin Corp. 16,000 1,432,000
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COMPUTER HARDWARE - 2.4% EMC Corp.(2) 50,000 1,818,750
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COMPUTER SOFTWARE - 10.7% Computer Associates International, Inc. 40,000 2,080,000
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Electronic Arts, Inc.(2) 195,000 4,704,375
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Maxis, Inc.(2) 165,000 1,134,375
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7,918,750
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ELECTRONICS - 3.2% Applied Materials, Inc.(2) 40,000 2,195,000
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Intel Corp. 1,000 153,125
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2,348,125
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TELECOMMUNICATIONS-TECHNOLOGY - 6.7% General Instrument Corp.(2) 140,000 3,272,500
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WorldCom, Inc. 70,000 1,680,000
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4,952,500
6 Oppenheimer Quest Growth & Income Value Fund
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STATEMENT OF INVESTMENTS (Unaudited)(Continued)
MARKET VALUE
SHARES SEE NOTE 1
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UTILITIES - 1.2%
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GAS UTILITIES - 1.2% El Paso Natural Gas Co. 15,000 $ 871,875
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Total Common Stocks (Cost $44,417,881) 46,902,022
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Total Investments, at Value (Cost $71,587,773) 100.0% 74,131,969
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Liabilities in Excess of Other Assets (0.0) (5,703)
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Net Assets 100.0% $ 74,126,266
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(1) Short-term notes are generally traded on a discount basis; the interest rate is
the discount rate received by
the Fund at the time of purchase.
(2) Non-income producing security.
See accompanying Notes to Financial Statements.
7 Oppenheimer Quest Growth & Income Value Fund
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STATEMENT OF ASSETS AND LIABILITIES April 30, 1997 (Unaudited)
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ASSETS Investments, at value (cost $71,587,773) - see accompanying statement $74,131,969
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Receivables:
Shares of beneficial interest sold 605,577
Interest and dividends 530,860
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Other 6,230
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Total assets 75,274,636
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LIABILITIES Bank overdraft 144,561
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Payables and other liabilities:
Investments purchased 414,640
Shares of beneficial interest redeemed 374,951
Distribution and service plan fees 135,477
Shareholder reports 39,463
Transfer agent and accounting service fees 6,320
Trustees' fees 3,502
Other 29,456
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Total liabilities 1,148,370
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NET ASSETS $74,126,266
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COMPOSITION OF Par value of shares of beneficial interest $62,383
NET ASSETS --------------------------------------------------------------------------------------
Additional paid-in capital 64,372,276
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Undistributed net investment income 122,654
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Accumulated net realized gain on investment transactions 7,024,757
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Net unrealized appreciation on investments - Note 3 2,544,196
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Net assets $74,126,266
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NET ASSET VALUE PER SHARE Class A Shares:
Net asset value and redemption price per share (based on net assets
of $51,796,054 and 4,352,818 shares of beneficial interest outstanding) $11.90
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $12.63
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Class B Shares:
Net asset value, redemption price and offering price per share (based
on net assets of $17,963,156 and 1,516,724 shares of beneficial
interest outstanding) $11.84
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Class C Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $4,367,056 and 368,761 shares of beneficial interest
outstanding) $11.84
See accompanying Notes to Financial Statements.
8 Oppenheimer Quest Growth & Income Value Fund
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STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED April 30, 1997 (Unaudited)
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INVESTMENT INCOME Interest $920,344
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Dividends 272,799
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Total income 1,193,143
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EXPENSES Management fees - Note 4 297,486
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Distribution and service plan fees - Note 4:
Class A 101,319
Class B 78,083
Class C 18,604
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Transfer agent and accounting service fees - Note 4 58,253
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Registration and filing fees:
Class A 26,250
Class B 8,347
Class C 2,021
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Shareholder reports 20,659
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Legal and auditing fees 13,121
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Trustees' fees and expenses 10,323
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Custodian fees and expenses 8,762
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Other 10,644
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Total expenses 653,872
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NET INVESTMENT INCOME 539,271
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REALIZED AND Net realized gain on investments 6,672,855
UNREALIZED GAIN (LOSS) ------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments (3,361,927)
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Net realized and unrealized gain 3,310,928
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NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $3,850,199
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See accompanying Notes to Financial Statements.
9 Oppenheimer Quest Growth & Income Value Fund
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STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1997 OCTOBER 31, 1996
(UNAUDITED)
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<S> <C> <C> <C>
OPERATIONS Net investment income $ 539,271 $ 1,055,959
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Net realized gain 6,672,855 6,454,155
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Net change in unrealized appreciation or depreciation (3,361,927) 3,175,436
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Net increase in net assets resulting
from operations 3,850,199 10,685,550
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DIVIDENDS AND DISTRIBUTIONS Dividends from net investment income:
TO SHAREHOLDERS Class A (425,038) (830,842)
Class B (88,699) (138,167)
Class C (23,171) (28,888)
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Distributions from net realized gain:
Class A (4,518,584) (1,723,234)
Class B (1,310,410) (359,598)
Class C (319,471) (82,370)
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BENEFICIAL INTEREST Net increase in net assets resulting from
TRANSACTIONS beneficial interest transactions - Note 2:
Class A 4,491,293 6,377,895
Class B 5,423,408 4,189,051
Class C 1,740,558 683,425
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NET ASSETS Total increase 8,820,085 18,772,822
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Beginning of period 65,306,181 46,533,359
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End of period (including undistributed net investment
income of $122,654 and $120,291, respectively) $ 74,126,266 $ 65,306,181
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See accompanying Notes to Financial Statements.
10 Oppenheimer Quest Growth & Income Value Fund
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FINANCIAL HIGHLIGHTS
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CLASS A
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SIX MONTHS
ENDED APRIL 30, YEAR ENDED OCTOBER 31,
1997 (UNAUDITED) 1996(2) 1995 1994 1993 1992
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PER SHARE OPERATING DATA:
Net asset value, beginning of
period $12.48 $10.92 $10.09 $11.24 $10.80 $10.00
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Income from investment operations:
Net investment income .10 .23 .27(3) .32(3) .30(3) .28(3)
Net realized and unrealized gain .57 2.05 1.27 .55 .73 .80
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Total income from investment
operations .67 2.28 1.54 .87 1.03 1.08
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Dividends and distributions to
shareholders:
Dividends from net investment income (.10) (.22) (.29) (.32) (.26) (.28)
Distributions from net realized gain (1.15) (.50) (.42) (1.70) (.33) --
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Total dividends and distributions
to shareholders (1.25) (.72) (.71) (2.02) (.59) (.28)
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Net asset value, end of period $11.90 $12.48 $10.92 $10.09 $11.24 $10.80
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TOTAL RETURN, AT NET ASSET VALUE(4) 5.78% 21.84% 16.35% 8.64% 9.93% 10.84%
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RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $51,796 $49,322 $37,082 $30,576 $28,466 $8,057
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Average net assets (in thousands) $51,142 $43,428 $33,397 $29,112 $23,771 $6,940
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Ratios to average net assets:
Net investment income 1.70%(6) 2.03% 2.60%(5) 3.16%(5) 2.66%(5) 2.73%(5)
Expenses(7) 1.70%(6) 1.90% 1.99%(5) 1.86%(5) 1.90%(5) 2.23%(5)
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Portfolio turnover rate(8) 42.2% 124.2% 130.0% 113.0% 192.0% 77.0%
Average brokerage commission rate(9) $0.0560 $0.0548 -- -- -- --
CLASS B
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SIX MONTHS
ENDED APRIL 30, YEAR ENDED OCTOBER 31,
1997 (UNAUDITED) 1996(2) 1995
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PER SHARE OPERATING DATA:
Net asset value, beginning of
period $12.42 $10.88 $10.07
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Income from investment operations:
Net investment income .07 .17 .19(3)
Net realized and unrealized gain .57 2.03 1.28
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Total income from investment
operations .64 2.20 1.47
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Dividends and distributions to
shareholders:
Dividends from net investment income (.07) (.16) (.24)
Distributions from net realized gain (1.15) (.50) (.42)
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Total dividends and distributions
to shareholders (1.22) (.66) (.66)
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Net asset value, end of period $11.84 $12.42 $10.88
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TOTAL RETURN, AT NET ASSET VALUE(4) 5.51% 21.07% 15.65%
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RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $17,963 $13,175 $7,623
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Average net assets (in thousands) $15,785 $10,097 $4,846
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Ratios to average net assets:
Net investment income 1.12%(6) 1.40% 1.71%(5)
Expenses(7) 2.30%(6) 2.53% 2.59%(5)
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Portfolio turnover rate(8) 42.2% 124.2% 130.0%
Average brokerage commission rate(9) $0.0560 $0.0548 --
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(1) For the period from September 1, 1993 (inception of offering) to
October 31, 1993.
(2) On November 22, 1995, OppenheimerFunds, Inc. became the investment adviser
to the Fund.
(3) Based on average shares outstanding for the period.
(4) Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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. Total returns are not annualized for periods of less than one full
year.
(5) During the periods presented above, the former Adviser voluntarily waived a
portion of its fees. If such waivers had not been in effect, the ratios of net
investment income to average
net assets and the ratios of expenses to average net assets for Class A would
have been 2.57% and 2.02%, respectively, for the year ended October 31, 1995,
2.70% and 2.32%, respectively,
for the year ended October 31, 1994, 2.38% and 2.18%, respectively, for the year
ended October 31, 1993, and 1.98% and 2.98%, respectively, for the year ended
October 31, 1992. The ratios
of net investment income to average net assets and the ratios of expenses to
average net assets would have been 1.73% and 2.57%, respectively, for Class B
and 1.43% and 2.84%, respectively,
for Class C, for the year ended October 31, 1995, 2.07% and 2.93%, respectively,
for Class B and 1.91% and 3.10%, respectively, for Class C, for the year ended
October 31, 1994 and 1.44% and
2.88%, respectively, for Class B and 1.80% and 2.87%, respectively, for Class C,
for the period September 1, 1993 (inception of offering) to October 31, 1993.
11 Oppenheimer Quest Growth & Income Value Fund
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FINANCIAL HIGHLIGHTS (Continued)
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CLASS B (Continued) CLASS C
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SIX MONTHS
YEAR ENDED OCTOBER 31, ENDED APRIL 30, YEAR ENDED OCTOBER 31,
1994 1993(1) 1997(UNAUDITED)1996(2) 1995 1994 1993(1)
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<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $11.23 $11.21 $12.43 $10.89 $10.07 $11.23 $11.21
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Income from investment operations:
Net investment income .25(3) .04(3) .07 .17 .15 (3) .24 (3) .04 (3)
Net realized and unrealized gain .56 .05 .56 2.02 1.30 .56 .05
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Total income from investment
operations .81 .09 .63 2.19 1.45 .80 .09
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Dividends and distributions to
shareholders:
Dividends from net investment income (.27) (.07) (.07) (.15) (.21) (.26) (.07)
Distributions from net realized gain (1.70) -- (1.15) (.50) (.42) (1.70) --
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Total dividends and distributions
to shareholders (1.97) (.07) (1.22) (.65) (.63) (1.96) (.07)
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Net asset value, end of period $10.07 $11.23 $11.84 $12.43 $10.89 $10.07 $11.23
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(4) 7.96% 0.81% 5.46% 20.97% 15.38% 7.91% 0.81%
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period $2,928 $319 $4,367 $2,809 $1,828 $455 $102
(in thousands)
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $1,586 $228 $3,763 $2,200 $ 968 $298 $100
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 2.53%(5) 1.83%(5)(6) 1.12%(6) 1.40% 1.39%(5) 2.39%(5) 2.18% (5)(6)
Expenses(7) 2.47%(5) 2.49%(5)(6) 2.29%(6) 2.53% 2.88%(5) 2.62%(5) 2.49% (5)(6)
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(8) 113.0% 192.0% 42.2% 124.2% 130.0% 113.0% 192.0%
Average brokerage commission rate(9) -- -- $0.0560 $0.0548 -- -- --
(6) Annualized.
(7) Beginning in fiscal 1996, the expense ratio reflects the effect of gross expenses paid indirectly by the Fund. Prior year
expense ratios have not been adjusted.
(8) 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
period ended April 30, 1997 were $41,075,527 and $27,736,709, respectively.
(9) Total brokerage commissions paid on applicable purchases and sales of portfolio securities for the period, divided by the total
number of related shares purchased and sold.
See accompanying Notes to Financial Statements.
</TABLE>
12 Oppenheimer Quest Growth & Income Value Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT Oppenheimer Quest Growth & Income Value Fund (the
ACCOUNTING POLICIES Fund), a series of Oppenheimer Quest for Value
Funds, is a diversified open-end management
investment company registered under the Investment
Company Act of 1940, as amended. The Fund's
investment objective is to seek capital
appreciation. It is the intention of the Fund to
continue to invest in a non-diversified portfolio
of primarily equity securities believed to be
under valued in the market place. The Fund's
investment adviser is OppenheimerFunds, Inc. (the
Manager). The Fund offers Class A, Class B and
Class C shares. Class A shares are sold with a
front-end sales charge. Class B and Class C
shares may be subject to a contingent deferred
sales charge. All 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 the close of the New York Stock Exchange
on each trading day. Listed and unlisted
securities for which such information is regularly
reported are valued at the last sale price of the
day or, in the absence of sales, at values based
on the closing bid or the last sale price on the
prior trading day. Long-term and short-term "non-
money market" debt securities are valued by a
portfolio pricing service approved by the Board of
Trustees. Such securities which cannot be valued
by the approved portfolio pricing service are
valued using dealer-supplied valuations provided
the Manager is satisfied that the firm rendering
the quotes is reliable and that the quotes reflect
current market value, or are valued under
consistently applied procedures established by the
Board of Trustees to determine fair value in good
faith. Short-term "money market type" 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.
--------------------------------------------------
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 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 or excise tax
provision is required.
--------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and
distributions to shareholders are recorded on the
ex-dividend date.
--------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS.
Net investment income (loss) and net realized gain
(loss) may differ for financial statement and tax
purposes. The character of the distributions made
during the year from net investment income or net
realized gains may differ from their ultimate
characterization for federal income tax purposes.
Also, due to timing of dividend distributions, the
fiscal year in which amounts are distributed may
differ from the year that the income or realized
gain was recorded by the Fund.
--------------------------------------------------
OTHER. Investment transactions are accounted for
on the date the investments are purchased or sold
(trade date) and dividend income is recorded on
the ex-dividend date. Interest income is accrued
on a daily basis. 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.
--------------------------------------------------
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.
13 Oppenheimer Quest Growth & Income Value Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of $.01 par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1997 OCTOBER 31, 1996
------------------------- ------------------------
SHARES AMOUNT SHARES AMOUNT
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 597,425 $ 7,200,085 966,147 $11,466,003
Dividends and distributions
reinvested 410,251 4,719,180 219,311 2,441,586
Redeemed (607,782) (7,427,972) (627,593) (7,529,694)
---------- ----------- --------- -----------
Net increase 399,894 4,491,293 557,865 $ 6,377,895
---------- ----------- --------- -----------
---------- ----------- --------- -----------
- -----------------------------------------------------------------------------------------------
Class B:
Sold 427,033 $ 5,139,510 482,330 $ 5,647,365
Dividends and distributions
reinvested 116,116 1,324,761 42,284 468,109
Redeemed (87,312) (1,040,863) (164,144) (1,926,423)
---------- ----------- --------- -----------
Net increase 455,837 $ 5,423,408 360,470 $ 4,189,051
---------- ----------- --------- -----------
---------- ----------- --------- -----------
- -----------------------------------------------------------------------------------------------
Class C:
Sold 163,753 $ 1,997,866 96,190 $ 1,134,271
Dividends and distributions
reinvested 28,527 326,896 9,569 105,983
Redeemed (49,493) (584,204) (47,618) (556,829)
---------- ----------- --------- -----------
Net increase 142,787 $ 1,740,558 58,141 $ 683,425
---------- ----------- --------- -----------
---------- ----------- --------- -----------
</TABLE>
- --------------------------------------------------------------------------------
3. UNREALIZED GAINS AND At April 30, 1997, net unrealized
LOSSES ON INVESTMENTS appreciation on investments of $2,544,196 was
composed of gross appreciation of $5,477,849, and
gross depreciation of $2,933,653.
- --------------------------------------------------------------------------------
4. MANAGEMENT FEES AND Management fees paid to the Manager were in
OTHER TRANSACTIONS accordance with the investment advisory
WITH AFFILIATES agreement with the Fund which provides for a fee
of 0.85% of average annual net assets. The
Manager acts as the accounting agent for the Fund
at an annual fee of $55,000, plus out-of-pocket
costs and expenses reasonably incurred.
The Manager pays OpCap Advisors (the Sub-
Adviser) a monthly fee based on the fee schedule
set forth in the Prospectus. For the period ended
April 30, 1997, the Manager paid $109,881 to the
Sub-Adviser. On February 13, 1997 PIMCO Advisors
L.P., signed a definitive agreement with
Oppenheimer Group, Inc. and its subsidiary
Oppenheimer Financial Corp. for PIMCO Advisors
L.P. and its affiliate, Thomson Advisory Group,
Inc., to acquire the one-third managing general
partner interest in Oppenheimer Capital (the
parent of OpCap Advisors) and the 1.0% general
interest in Oppenheimer Capital L.P.
For the six months ended April 30, 1997,
commissions (sales charges paid by investors) on
sales of Class A shares totaled $82,521, of which
$29,526 was retained by OppenheimerFunds
Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by affiliated
broker/dealers. Sales charges advanced to
broker/dealers by OFDI on sales of the Fund's
Class B and Class C shares totaled $185,971 and
$19,538, respectively, of which $16,470 was paid
to an affiliated broker/dealer for Class B shares.
During the six months ended April 30, 1997, OFDI
received contingent deferred sales charges of
$18,179 upon redemption of Class B shares as
reimbursement for sales commissions advanced by
OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division
of the Manager, is the transfer and shareholder
servicing agent for the Fund, and for other
registered investment companies. The Fund pays
OFS an annual maintenance fee of $14.85 for each
Fund shareholder account and reimburses OFS for
its out-of-pocket expenses. During the six months
ended April 30, 1997, the Fund paid OFS $32,293.
14 Oppenheimer Quest Growth & Income Value Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
(Continued)
- --------------------------------------------------------------------------------
4. MANAGEMENT FEES Under a proposed Distribution and Service
AND OTHER TRANSACTIONS Plan for Class A shares (that was approved by
WITH AFFILIATES the Board of Trustees at a meeting held
(CONTINUED) February 4, 1997 and by the shareholders of the
Fund at a meeting held May 19, 1997) OFDI is
compensated for a portion of its costs incurred in
connection with the personal service and
maintenance of accounts that hold Class A shares.
Under the Plan, the Fund pays an annual asset-
based sales charge to OFDI of 0.15% per year on
Class A shares. The Fund also pays a service fee
to OFDI of 0.25% per year. Both fees are computed
on the average annual net assets of Class A shares
of the Fund, determined as of the close of each
regular business day. OFDI uses all of the
service fee and a portion of the asset-based sales
charge to compensate brokers, dealers, banks and
other financial institutions quarterly for
providing personal service and maintenance of
accounts of their customers that hold Class A
shares. OFDI retains the balance of the asset-
based sales charge to reimburse itself for its
other expenditures under the Plan. During the six
months ended April 30, 1997, OFDI retained $8,491
as compensation for Class A sales commissions and
service fee advances, as well as financing costs.
Under proposed Distribution and Service Plans
for Class B and C shares (that were approved by
the Board of Trustees at a meeting held February
4, 1997 and by the shareholders of the Fund at a
meeting held May 19, 1997) OFDI is compensated for
its services and costs in distributing Class B and
Class C shares and servicing accounts. Under the
Plans, the Fund pays OFDI an annual asset-based
sales charge of 0.75% per year on Class B and
Class C shares, as compensation for sales
commissions paid from its own resources at the
time of sale and associated financing costs. OFDI
also receives a service fee of 0.25% per year as
compensation 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. Both fees are computed on
the average annual net assets of Class B and Class
C shares, determined as of the close of each
regular business day. During the six months ended
April 30, 1997, OFDI retained $66,450 and $9,203,
respectively, as compensation for Class B and
Class C sales commissions and service fee
advances, as well as financing costs. If the
Plans are terminated by the Fund, the Board of
Trustees may allow the Fund to continue payments
of the asset-based sales charge to OFDI for
certain expenses it incurred before the Plans were
terminated. At April 30, 1997, OFDI had incurred
unreimbursed expenses of $266,620 for Class B and
$29,723 for Class C.
15 Oppenheimer Quest Growth & Income Value Fund
<PAGE>
OPPENHEIMER QUEST GROWTH & INCOME VALUE FUND
A Series of Oppenheimer Quest for Value Funds
OFFICERS AND TRUSTEES Bridget A. Macaskill, Chairman of the Board of Trustees
and President
Paul Y. Clinton, Trustee
Thomas W. Courtney, Trustee
Lacy B. Herrmann, Trustee
George Loft, Trustee
Robert C. Doll, Jr., Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
- --------------------------------------------------------------------------------
INVESTMENT ADVISER OppenheimerFunds, Inc.
- --------------------------------------------------------------------------------
SUB-ADVISER OpCap Advisors
- --------------------------------------------------------------------------------
DISTRIBUTOR OppenheimerFunds Distributor, Inc.
TRANSFER AND OppenheimerFunds Services
SHAREHOLDER
SERVICING AGENT
- --------------------------------------------------------------------------------
CUSTODIAN OF State Street Bank and Trust Company
PORTFOLIO SECURITIES
- --------------------------------------------------------------------------------
INDEPENDENT Price Waterhouse LLP
ACCOUNTANTS
- --------------------------------------------------------------------------------
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have been
taken from the records of the Fund without examination
by the independent accountants.
This is a copy of a report to shareholders of
Oppenheimer Quest Growth & Income Value Fund. This
report must be preceded or accompanied by a Prospectus
of Oppenheimer Quest Growth & Income Value Fund. For
material information concerning the Fund, see the
Prospectus.
Shares of Oppenheimer funds are not deposits or
obligations of any bank, are not guaranteed by any
bank, and are not insured by the FDIC or any other
agency, and involve investment risks, including
possible loss of the principal amount invested.
16 Oppenheimer Quest Growth & Income Value Fund
