Oppenheimer Cash Reserves
Annual Report December 31, 1995
[COVER PHOTO] "We want to
know our
money will
be there
when we
need it."
[LOGO-OPPENHEIMER FUNDS(R)]
<PAGE>
This Fund is for people who want to earn current income while maintaining the
value of their initial investment.
How Your Fund Is Managed
Oppenheimer Cash Reserves Fund seeks maximum current income with stability of
principal while giving you a way to keep a portion of your assets liquid.
The manager of your Fund looks for maximum yield from money market
securities, such as short-term corporate notes, U.S. government securities, and
repurchase agreements.
The Fund's dividends accrue daily and are paid monthly. And to offer you
stability of principal, the Fund seeks to maintain a constant $1.00 per share
net asset value (NAV).(1)
Performance
The Fund's seven-day annualized yield for Class A shares as of 12/31/95 was
4.88% with compounding and 4.76% without compounding. For Class B and C shares,
the seven-day annualized yields were 4.31% and 4.29% with compounding, and
4.22% and 4.20% without compounding, respectively.(2)
Compounded annualized yield for Class A shares for the 12 months ended
12/31/95 was 4.87%. Without compounding, the annualized yield was 4.76%. For
Class B and C shares, compounded annualized yields for the 12 months ended
12/31/95 were 4.28% and 4.23%. Without compounding, they were 4.19% and 4.14%.
Outlook
"Our outlook remains positive. Our goal in a trading range market like this one
is to work to position ourselves to take full advantage of the market whether
rates change or not, and to be on the lookout for anything that we can do to
increase yield without compromising safety."
Dottie Warmack, Portfolio Manager
December 31, 1995
Past performance does not guarantee future results.
1. 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 share price in the
future.
2. Compounded yields assume reinvestment of dividends.
2 Oppenheimer Cash Reserves
<PAGE>
[PHOTO - JAMES C. SWAIN]
James C. Swain
Chairman
Oppenheimer
Cash Reserves
[PHOTO - BRIDGET A. MACASKILL]
Bridget A. Macaskill
President
Oppenheimer
Cash Reserves
Dear Oppenheimer Funds Shareholder,
Money market funds have always been a highly
liquid place for cash "on the sidelines"--earning a steady income while
protecting principal. In 1995, money market funds turned out to be a good
investment choice for the income-oriented investor.
While the 30-year U.S. Treasury yield fell from nearly 8% to 6% during the
year, and rates on intermediate-term bonds fell by nearly as much, money market
yields stayed about the same throughout the year. This made the yield on money
market funds very attractive relative to intermediate-term bonds.
Normally, long-term bonds pay anywhere from three to five percentage
points more than a money market fund. That's because long-term investors expect
a higher interest rate in exchange for the longer commitment and more
substantial amount of their investment. But if investors expect interest rates
to fall--as they have throughout the year--they don't want to make that
commitment.
One reason for this situation is the relationship between money market
funds and the inflation rate. Typically, money market yields are roughly one
percentage point above inflation. Assuming that the annual inflation rate is
2.5%, money market yields would normally be about 3.5%, while longer-term rates
might be as high as 5.5%. However, the current difference between money market
yields and inflation is three times its normal level. Part of the reason for
this anomaly is the successful way in which the Federal Reserve Board has
fought inflation.
Between February 1994 and February 1995, the Fed doubled short-term
interest rates from 3% to 6% in an effort to slow down the economy. By the
spring of 1995, the economy stabilized and began to decelerate. And economists
began to speculate that the Fed would lower short-term rates to keep the
economy from going into a recession. Meanwhile, longer-term interest rates had
already begun to decline in anticipation of the Fed action. And although the
Fed reduced short-term interest rates slightly in July, it didn't lower rates
nearly as much as the decline in long-term rates, which are market driven.
The Federal Reserve Board accomplished its mission of a "soft landing" for
the economy. Unlike 1994, the economy is not growing fast enough to rekindle
inflation, yet it is growing enough to avoid recession. With the economy
continuing to slow, we believe that another cut by the Fed is likely. And since
longer-term rates will probably come down further, we expect the relationship
between short-term yields and longer-term yields will remain similar for the
time being.
As a result, money market funds continue to offer relatively high yields
in relation to longer-term investments--and in relation to inflation. Your
portfolio manager discusses the outlook for your Fund in light of these broad
issues on the following pages.
Thank you for your confidence in OppenheimerFunds, and we look forward to
helping you reach your investment goals in the future.
/s/ James C. Swain /s/ Bridget A. Macaskill
James C. Swain Bridget A. Macaskill
January 22, 1996
3 Oppenheimer Cash Reserves
<PAGE>
Dottie Warmack
Portfolio Manager
Q + A
An interview with your Fund's manager.
How has the Fund performed over the past six months?
Performance over the period has been quite good in light of the fact that our
market has been relatively volatile. Because the types of securities we buy are
extremely short-term, they tend to be affected by a wide variety of reports on
the economy, and that's essentially what we've seen over the past six months--a
somewhat fluctuating market driven by changing economic news.
What investments have had a positive effect on the portfolio?
During the past 12 months, the Fund benefited from a period of considerable
demand for relatively high yielding Small Business Administration loans,
securities that had made up approximately 5% of our portfolio. With demand
for these issues increasing, causing their prices to go up, we sold almost
all of our holdings for a profit, which is somewhat unusual in our short-term
market.(1)
Were there any investments that didn't perform as well as expected?
Not really. While the income available from money market securities depends
primarily on prevailing interest rates, our market tends to offer a great deal
of stability and predictability in terms of price.
What areas of the market are you currently targeting?
Over most of the past six months, the yield curve, which is the measure of the
difference in yields available from bonds with different maturities, had been
relatively flat. This caused a situation in which longer-term investments,
which generally offer higher yields than shorter-term vehicles, no longer
offered that advantage. For example, rates on investments with maturities
ranging from one month to one year had yields that were about the same during
that time period.
More recently, however, we began to experience an inverted yield curve, an
unusual phenomenon in which shorter maturity securities actually have higher
yields than longer ones. We believe this inverted curve is the result of the
market's expectation that the Federal Reserve will lower rates. What it means
to us as investors is that we should try to lock in currently higher rates.
That's what we've focused on doing recently, working to extend maturities where
appropriate, thereby taking advantage of today's market for as long as
possible.
What is your outlook for the Fund?
Our outlook remains positive. As we move into 1996, we don't expect any
dramatic interest rate changes on the horizon. Even if the Federal Reserve cuts
rates as the market believes it will, we don't expect it to be a big cut, so it
shouldn't negatively impact our yield to a significant degree. Our goal in a
trading range market like this one is to work to position ourselves to take
full advantage of the market whether rates change or not, and to be on the
lookout for anything that we can do to increase yield without compromising
safety.
1. The Fund's portfolio is subject to change.
4 Oppenheimer Cash Reserves
<PAGE>
Financials
Contents
Statement of Investments 6
Statement of Assets & Liabilities 9
Statement of Operations 10
Statements of Changes in Net Assets 11
Financial Highlights 12
Notes to Financial Statements 14
Independent Auditors' Report 16
Federal Income Tax Information 17
5 Oppenheimer Cash Reserves
<PAGE>
Statement of Investments December 31, 1995
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
<S> <C> <C>
=================================================================================================================================
Bankers' Acceptances--2.6%
- ---------------------------------------------------------------------------------------------------------------------------------
Chemical Bank New York, 5.42%, 5/17/96 (Cost $4,896,869) $5,000,000 $ 4,896,869
=================================================================================================================================
Direct Bank Obligations--12.4%
- ---------------------------------------------------------------------------------------------------------------------------------
ABN Amro North America Finance, Inc., 5.45%, 1/12/96 3,000,000 2,995,004
-------------------------------------------------------------------------------------------------------------
Bank of New York, 5.23%, 1/12/96(1) 5,150,000 5,149,954
-------------------------------------------------------------------------------------------------------------
First National Bank of Boston, 5.85%, 4/18/96(1) 5,000,000 5,000,000
-------------------------------------------------------------------------------------------------------------
National Westminster Bank of Canada, 5.40%, 7/26/96 5,800,000 5,619,910
-------------------------------------------------------------------------------------------------------------
Shawmut Bank of Connecticut, N.A., 5.75%, 6/24/96(1) 5,000,000 5,000,000
------------
Total Direct Bank Obligations (Cost $23,764,868) 23,764,868
=================================================================================================================================
Letters of Credit--7.2%
- ---------------------------------------------------------------------------------------------------------------------------------
Barclays Bank PLC, guaranteeing commercial paper of:
Banco Real, S.A.-Grand Cayman Branch, 5.63%, 4/18/96 6,500,000 6,390,215
-------------------------------------------------------------------------------------------------------------
Credit Suisse, guaranteeing commercial paper of:
Daewoo International Corp., 5.70%, 2/27/96 7,500,000 7,432,312
------------
Total Letters of Credit (Cost $13,822,527) 13,822,527
=================================================================================================================================
Short-Term Notes--65.2%
- ---------------------------------------------------------------------------------------------------------------------------------
Banks--7.8%
Barnett Banks, Inc., 6.10%, 1/5/96 8,000,000 7,994,578
-------------------------------------------------------------------------------------------------------------
CoreStates Capital Corp., 5.71%, 2/15/96 7,000,000 6,950,037
------------
14,944,615
- ---------------------------------------------------------------------------------------------------------------------------------
Broker/Dealers--9.9%
Lehman Brothers Holdings, Inc., 6.25%, 1/2/96 9,000,000 8,998,437
-------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 5.70%--5.72%, 1/31/96 5,000,000 4,976,167
-------------------------------------------------------------------------------------------------------------
Morgan Stanley Group, Inc., 5.53%, 9/30/96(1) 5,000,000 5,000,000
------------
18,974,604
- ---------------------------------------------------------------------------------------------------------------------------------
Commercial Finance--12.0%
Countrywide Funding, 6.10%, 1/4/96 3,000,000 2,998,475
-------------------------------------------------------------------------------------------------------------
FINOVA Capital Corp.:
5.64%, 3/11/96 3,000,000 2,966,633
5.85%, 1/18/96 4,000,000 3,988,950
5.95%, 2/28/96 2,000,000 1,981,247
-------------------------------------------------------------------------------------------------------------
Fleet Mortgage Group, Inc., 5.58%, 4/4/96 4,000,000 3,941,720
-------------------------------------------------------------------------------------------------------------
Heller Financial, Inc.:
5.52%, 3/12/96 5,000,000 4,945,567
5.78%, 3/4/96 2,000,000 1,979,770
------------
22,802,362
- ---------------------------------------------------------------------------------------------------------------------------------
Conglomerates--3.3%
Mitsubishi International Corp.:
5.75%, 1/8/96 250,000 249,720
5.75%, 2/5/96 1,400,000 1,392,174
-------------------------------------------------------------------------------------------------------------
Pacific Dunlop Holdings, Inc., guaranteed by Pacific Dunlop Ltd.:
5.44%, 5/31/96 2,085,000 2,037,775
5.70%, 2/29/96 2,654,000 2,629,338
------------
6,309,007
</TABLE>
6 Oppenheimer Cash Reserves
<PAGE>
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
Consumer Finance--3.1%
Beneficial Corp., 5.26%, 2/1/96(1) $4,000,000 $ 4,000,000
-------------------------------------------------------------------------------------------------------------
Island Finance Puerto Rico, Inc., 5.72%, 2/1/96 2,000,000 1,990,149
------------
5,990,149
- ---------------------------------------------------------------------------------------------------------------------------------
Diversified Financial--7.3%
General Electric Capital Corp.:
5.47%, 5/3/96 4,163,000 4,085,222
5.48%, 4/3/96 3,000,000 2,956,677
-------------------------------------------------------------------------------------------------------------
Toyota Motor Credit Corp., 5.06%, 6/13/96(1) 6,960,000 6,949,873
------------
13,991,772
- ---------------------------------------------------------------------------------------------------------------------------------
Electric Utilities--4.2%
Central & Southwest Corp.:
5.59%, 2/23/96 2,400,000 2,379,789
5.71%, 2/16/96 5,600,000 5,559,178
------------
7,938,967
- ---------------------------------------------------------------------------------------------------------------------------------
Electronics--5.8%
Avnet, Inc., 5.70%, 2/5/96 4,000,000 3,977,833
-------------------------------------------------------------------------------------------------------------
Mitsubishi Electric Finance America, Inc., 5.80%, 1/31/96 7,000,000 6,966,167
------------
10,944,000
- ---------------------------------------------------------------------------------------------------------------------------------
Environmental--2.5%
WMX Technologies, Inc., 5.32%, 9/10/96 5,000,000 4,813,061
- ---------------------------------------------------------------------------------------------------------------------------------
Manufacturing--2.5%
Hanson Finance (UK) PLC, guaranteed by Hanson PLC, 5.71%--5.77%, 1/16/96 4,800,000 4,788,460
- ---------------------------------------------------------------------------------------------------------------------------------
Special Purpose Financial--2.6%
Cooperative Association of Tractor Dealers, Inc., 5.75%, 1/8/96 2,000,000 1,997,764
-------------------------------------------------------------------------------------------------------------
Madison Funding Corp., 5.65%, 3/27/96 3,000,000 2,959,508
------------
4,957,272
- ---------------------------------------------------------------------------------------------------------------------------------
Specialty Retailing--4.2%
St. Michael Finance, Ltd., guaranteed by Marks & Spencer PLC:
5.45%, 5/28/96 5,157,000 5,041,561
5.70%, 2/12/96 2,930,000 2,910,516
------------
7,952,077
------------
Total Short-Term Notes (Cost $124,406,346) 124,406,346
=================================================================================================================================
U.S. Government Obligations--7.5%
- ---------------------------------------------------------------------------------------------------------------------------------
Small Business Administration, 9.624%, 1/2/96(2) 221,792 245,414
-------------------------------------------------------------------------------------------------------------
Student Loan Marketing Assn., guaranteeing commercial paper of:
Secondary Market Services, Inc., Education Loan Revenue Nts., Series-1995A:
5.72%--5.75%, 1/12/96 5,994,000 5,983,469
5.77%, 1/19/96 8,100,000 8,076,631
------------
Total U.S. Government Obligations (Cost $14,305,514) 14,305,514
=================================================================================================================================
Foreign Government Obligations--4.2%
- ---------------------------------------------------------------------------------------------------------------------------------
Swedish Export Credit Corp., supported by Kingdom of Sweden,
5.60%--5.68%, 1/16/96 5,000,000 4,988,167
-------------------------------------------------------------------------------------------------------------
Westdeutsche Landesbank Girozentrale supported by Federal Republic
of Germany, guaranteeing commercial paper of:
Unibanco-Uniao de Brancos Brasileiros S.A.-Grand Cayman, 5.66%, 4/12/96 3,000,000 2,951,890
------------
Total Foreign Government Obligations (Cost $7,940,057) 7,940,057
</TABLE>
7 Oppenheimer Cash Reserves
<PAGE>
Statement of Investments (Continued)
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
<S> <C> <C>
=================================================================================================================================
Repurchase Agreements--2.4%
- ---------------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with PaineWebber, Inc., 5.93%,
dated 12/29/95, to be repurchased at $4,653,064
on 1/2/96, collateralized by Government National Mortgage
Assn. Participation Nts., 7%--8%, 8/15/23--11/15/25, with
a value of $3,200,178, and Federal National Mortgage Assn.
Participation Nts., 7.50%, 3/1/24, with a value of $1,868,979
(Cost $4,650,000) $4,650,000 $ 4,650,000
- ---------------------------------------------------------------------------------------------------------------------------------
Total Investments, at Value 101.5% 193,786,181
- ---------------------------------------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (1.5) (2,855,379)
---------- ------------
Net Assets 100.0% $190,930,802
========== ============
</TABLE>
Short-term notes, bankers' acceptances, direct bank
obligations and letters of credit are generally traded on a
discount basis; the interest rate is the discount rate
received by the Trust at the time of purchase. Other
securities normally bear interest at the rates shown.
1. Variable rate security. The interest rate, which is
based on specific, or an index of, market interest rates,
is subject to change periodically and is the effective rate
on December 31, 1995.
2. Floating or variable rate obligation maturing in more
than one year. The interest rate, which is based on
specific, or an index of, market interest rates, is subject
to change periodically and is the effective rate on
December 31, 1995. This instrument may also have a demand
feature which allows the recovery of principal at any time,
or at specified intervals not exceeding one year, on up to
30 days' notice. Maturity date shown represents effective
maturity based on variable rate and, if applicable, demand
feature.
See accompanying Notes to Financial Statements.
8 Oppenheimer Cash Reserves
<PAGE>
Statement of Assets and Liabilities December 31, 1995
<TABLE>
<CAPTION>
<S> <C>
==================================================================================================================================
Assets Investments, at value--see accompanying statement $193,786,181
--------------------------------------------------------------------------------------------------------------
Cash 1,058,156
--------------------------------------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 8,767,580
Interest and principal paydowns 220,240
--------------------------------------------------------------------------------------------------------------
Other 34,282
------------
Total assets 203,866,439
==================================================================================================================================
Liabilities Payables and other liabilities:
Shares of beneficial interest redeemed 12,673,998
Shareholder reports 102,183
Distribution and service plan fees 61,771
Transfer and shareholder servicing agent fees 39,549
Dividends 38,858
Other 19,278
------------
Total liabilities 12,935,637
============
==================================================================================================================================
Net Assets $190,930,802
============
==================================================================================================================================
Composition of
Net Assets Paid-in capital $190,937,308
--------------------------------------------------------------------------------------------------------------
Accumulated net realized loss from investment transactions (6,506)
------------
Net assets $190,930,802
============
==================================================================================================================================
Net Asset Value
Per Share Class A Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $148,528,889 and 148,591,032 shares of beneficial interest outstanding) $1.00
--------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $37,378,098 and 37,377,546 shares of beneficial interest outstanding) $1.00
--------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $5,023,815 and 5,023,417 shares of beneficial interest outstanding) $1.00
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Cash Reserves
<PAGE>
Statement of Operations For the Year Ended December 31, 1995
<TABLE>
<CAPTION>
<S> <C>
=================================================================================================================================
Investment Income Interest $8,909,157
=================================================================================================================================
Expenses Management fees--Note 3 732,759
-------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 3 648,387
-------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 3:
Class A 210,588
Class B 264,659
Class C 45,313
-------------------------------------------------------------------------------------------------------------
Shareholder reports 198,680
-------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 34,645
Class B 16,332
Class C 5,256
-------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 33,844
-------------------------------------------------------------------------------------------------------------
Legal and auditing fees 13,011
-------------------------------------------------------------------------------------------------------------
Insurance expenses 7,127
-------------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 1,849
-------------------------------------------------------------------------------------------------------------
Other 20,137
------------
Total expenses 2,232,587
=================================================================================================================================
Net Investment Income 6,676,570
=================================================================================================================================
Net Realized Gain 37,450
=================================================================================================================================
Net Increase in Net Assets Resulting From Operations $6,714,020
============
</TABLE>
See accompanying Notes to Financial Statements.
10 Oppenheimer Cash Reserves
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended December 31,
1995 1994
<S> <C> <C>
=================================================================================================================================
Operations Net investment income $ 6,676,570 $ 3,568,242
-------------------------------------------------------------------------------------------------------------
Net realized gain 37,450 56
------------ ------------
Net increase in net assets resulting from operations 6,714,020 3,568,298
=================================================================================================================================
Dividends and Class A (4,996,089) (2,852,731)
Distributions to Class B (1,474,886) (648,288)
Shareholders Class C (249,786) (67,223)
=================================================================================================================================
Beneficial Interest
Transactions Net increase (decrease) in net assets resulting from beneficial
interest transactions--Note 2:
Class A 49,175,977 28,436,616
Class B (9,426,294) 46,175,820
Class C (580,955) 5,603,372
=================================================================================================================================
Net Assets Total increase 39,161,987 80,215,864
-------------------------------------------------------------------------------------------------------------
Beginning of period 151,768,815 71,552,951
------------ ------------
End of period $190,930,802 $151,768,815
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Cash Reserves
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Class A
-------------------------------------------------------
Year Ended December 31,
1995 1994 1993 1992
<S> <C> <C> <C> <C>
===========================================================================================================
Per Share Operating Data:
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
Income from investment operations--net
investment income and net realized gain .05 .03 .02 .03
- -----------------------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders (.05) (.03) (.02) (.03)
- -----------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00
======== ======== ======== ========
===========================================================================================================
Total Return, at Net Asset Value(5) 4.84% 3.22% 2.05% 3.07%
===========================================================================================================
Ratios/Supplemental Data:
Net assets, end of period (in thousands) $148,529 $99,361 $70,924 $89,266
- -----------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $105,349 $87,908 $76,910 $104,970
- -----------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.71% 3.25% 1.99% 3.07%
Expenses, before voluntary reimbursement
by the Manager 1.36% 1.32% 1.55% 1.42%
Expenses, net of voluntary reimbursement
by the Manager N/A N/A N/A 1.25%
</TABLE>
1. For the period from December 1, 1993 (inception of offering) to December 31,
1993.
2. For the period from August 17, 1993 (inception of offering) to December 31,
1993.
3. For the period from January 3, 1989 (commencement of operations) to December
31, 1989.
4. Less than $.005 per share.
12 Oppenheimer Cash Reserves
<PAGE>
<TABLE>
<CAPTION>
Class B Class C
- ------------------------------------ ----------------------------------------- -----------------------------------------
Year Ended December 31, Year Ended December 31,
1991 1990 1989(3) 1995 1994 1993(2) 1995 1994 1993(1)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
===================================================================================================================================
$1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------------------------------
.06 .07 .08 .04 .03 --(4) .04 .02 --(4)
- -----------------------------------------------------------------------------------------------------------------------------------
(.06) (.07) (.08) (.04) (.03) --(4) (.04) (.02) --(4)
- -----------------------------------------------------------------------------------------------------------------------------------
$1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ======== ======== ======== ========
===================================================================================================================================
5.67% 7.60% 8.46% 4.26% 2.54% .56% 4.21% 2.51% .14%
===================================================================================================================================
$112,883 $44,293 $19,227 $37,378 $46,803 $628 $5,024 $5,604 $1
- -----------------------------------------------------------------------------------------------------------------------------------
$105,352 $32,637 $6,280 $35,360 $21,262 $454 $6,040 $2,107 $1
- -----------------------------------------------------------------------------------------------------------------------------------
5.13% 7.32% 8.10%(6) 4.15% 3.05% 1.49%(6) 4.12% 3.19% 1.18%(6)
1.22% 1.29% 1.74%(6) 1.92% 1.89% 2.12%(6) 1.97% 1.90% 2.35%(6)
1.15% 1.00% 1.00%(6) N/A N/A N/A N/A N/A N/A
</TABLE>
5. 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 are not
annualized for periods of less than one full year. Total returns reflect changes
in net investment income only.
6. Annualized.
See accompanying Notes to Financial Statements.
13 Oppenheimer Cash Reserves
<PAGE>
Notes to Financial Statements
===============================================================================
1. Significant
Accounting Policies
Oppenheimer Cash Reserves (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 the maximum current income
that is consistent with stability of principal. The Fund's investment advisor is
OppenheimerFunds, Inc. (the Manager). The Fund offers Class A, Class B and Class
C shares. Class B and Class C shares may be subject to a contingent deferred
sales charge. All three 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 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.
- -------------------------------------------------------------------------------
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 to shareholders. Therefore, no federal
income or excise tax provision is required.
- -------------------------------------------------------------------------------
Distributions to Shareholders. The Fund intends to declare dividends separately
for Class A, Class B and Class C shares 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.
14 Oppenheimer Cash Reserves
<PAGE>
===============================================================================
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, 1995 Year Ended December 31, 1994
------------------------------ ----------------------------
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------
Class A:
Sold 367,360,698 $367,360,698 298,811,461 $298,811,461
Dividends and distributions reinvested 4,666,289 4,666,289 2,517,663 2,517,663
Redeemed (322,851,010) (322,851,010) (272,892,508) (272,892,508)
------------ ------------ ------------ ------------
Net increase 49,175,977 $ 49,175,977 28,436,616 $ 28,436,616
============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------
Class B:
Sold 111,551,709 $111,551,709 101,626,173 $101,626,173
Dividends and distributions reinvested 1,179,668 1,179,668 519,118 519,118
Redeemed (122,157,671) (122,157,671) (55,969,471) (55,969,471)
------------ ------------ ------------ ------------
Net increase (decrease) (9,426,294) $ (9,426,294) 46,175,820 $ 46,175,820
============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------
Class C:
Sold 20,708,644 $ 20,708,644 11,011,788 $ 11,011,788
Dividends and distributions reinvested 207,924 207,924 56,507 56,507
Redeemed (21,497,523) (21,497,523) (5,464,923) (5,464,923)
------------ ------------ ------------ ------------
Net increase (decrease) (580,955) $ (580,955) 5,603,372 $ 5,603,372
============ ============ ============ ============
=============================================================================================================
</TABLE>
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 a fee of .50% on the first
$250 million of average annual net assets with a reduction of .025% on each $250
million thereafter, to .40% on net assets in excess of $1 billion. The Manager
has agreed to reimburse the Fund if aggregate expenses (with specified
exceptions) exceed the most stringent state regulatory limit on Fund expenses.
Sales charges advanced to broker/dealers by OppenheimerFunds Distributor,
Inc. (OFDI) on sales of the Fund's Class B and Class C shares totaled $6,639 and
$471, respectively, of which $600 and $20 was paid to an affiliated
broker/dealer. During the year ended December 31, 1995, OFDI received contingent
deferred sales charges of $372,712 and $13,532 upon redemption of Class B and
Class C 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. OFS's total costs of providing such services are allocated
ratably to these companies.
Under separate approved plans, Class A may expend up to .20% and Class B
and Class C may expend up to .25% of average class 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 institutions. Currently, these service fees
are set at 0% for both Class B and Class C. In addition, Class B and Class C
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 or Class C 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 or Class C shares sold prior to
termination or discontinuance of the plan. During the year ended December 31,
1995, OFDI paid $68,633 to an affiliated broker/dealer as reimbursement for
Class A, personal service and maintenance expenses, respectively, and retained
$264,659 and $45,313 as reimbursement for Class B and Class C sales commissions
and service fee advances as well as financing costs, respectively.
15 Oppenheimer Cash Reserves
<PAGE>
Independent Auditors' Report
===============================================================================
The Board of Trustees and Shareholders of Oppenheimer Cash Reserves:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Oppenheimer Cash Reserves as of December 31,
1995, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended December 31, 1995 and
1994, and the financial highlights for the period January 3, 1989 (commencement
of operations) to December 31, 1995. 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, 1995 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 Cash
Reserves at December 31, 1995, 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, 1996
16 Oppenheimer Cash Reserves
<PAGE>
Federal Income Tax Information (Unaudited)
================================================================================
In early 1996, shareholders will receive information regarding all dividends
and distributions paid to them by the Fund during calendar year 1995.
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, 1995 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 advisor for specific guidance.
17 Oppenheimer Cash Reserves
<PAGE>
Oppenheimer Cash Reserves
===============================================================================
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
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Bridget A. Macaskill, Trustee and President
Ned M. Steel, Trustee
Andrew J. Donohue, Vice President
Dorothy G. Warmack, 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 OppenheimerFunds, Inc.
===============================================================================
Distributor OppenheimerFunds Distributor, Inc.
===============================================================================
Transfer and OppenheimerFunds Services
Shareholder
Servicing Agent
===============================================================================
Custodian of Citibank, N.A.
Portfolio Securities
===============================================================================
Independent Auditors Deloitte & Touche LLP
===============================================================================
Legal Counsel Myer, Swanson, Adams & Wolf, P.C.
This is a copy of a report to shareholders of
Oppenheimer Cash Reserves. This report must be preceded
or accompanied by a Prospectus of Oppenheimer Cash
Reserves. 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.
18 Oppenheimer Cash Reserves
<PAGE>
Oppenheimer Funds Family
===============================================================================
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 35 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 2.8 million shareholder accounts and more than $41
billion under Oppenheimer's management and that of our affiliates.
At OppenheimerFunds, we don't charge a fee to exchange shares. And you can
exchange shares easily by mail or by telephone.1 For more information on
Oppenheimer funds, 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.
<TABLE>
<CAPTION>
<S> <C> <C>
=====================================================================================
Stock Funds Global Emerging Growth Fund Growth Fund
Enterprise Fund Global Fund
Discovery Fund Quest Global Value Fund
Quest Small Cap Value Fund Oppenheimer Fund
Gold & Special Minerals Fund Value Stock Fund
Target Fund Quest Value Fund
=====================================================================================
Stock & Bond Funds Main Street Income & Growth Fund Global Growth & Income Fund
Quest Opportunity Value Fund Equity Income Fund
Total Return Fund Asset Allocation Fund
Quest Growth & Income Value Fund Strategic Income & Growth Fund
=====================================================================================
Bond Funds International Bond Fund Bond Fund
High Yield Fund U.S. Government Trust
Strategic Income Fund Limited-Term Government Fund
Champion Income Fund
=====================================================================================
Tax-Exempt Funds California Tax-Exempt Fund(2) Pennsylvania Tax-Exempt Fund(2)
Florida Tax-Exempt Fund(2) Tax-Free Bond Fund
New Jersey Tax-Exempt Fund(2) Insured Tax-Exempt Fund
New York Tax-Exempt Fund(2) Intermediate Tax-Exempt Fund
=====================================================================================
Money Market Funds Money Market Fund Cash Reserves
</TABLE>
1. Exchange privileges are subject to change or termination. Shares may be
exchanged only for shares of the same class of eligible funds.
2. Available only to investors in certain states. Oppenheimer funds are
distributed by OppenheimerFunds Distributor, Inc., Two World Trade Center, New
York, NY 10048-0203.
(C) Copyright 1996 OppenheimerFunds, Inc. All rights reserved.
19 Oppenheimer Cash Reserves
<PAGE>
Information
General Information
Monday-Friday 8:30 a.m.-8 p.m. ET
Saturday 10 a.m.-2 p.m. ET
1-800-525-7048
Telephone Transactions
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-852-8457
PhoneLink
24 hours a day, automated
information and transactions
1-800-533-3310
Telecommunications Device
for the Deaf (TDD)
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-843-4461
OppenheimerFunds
Information Hotline
24 hours a day, timely and insightful
messages on the economy and
issues that affect your investments
1-800-835-3104
RA0760.001.1295 February 28, 1996
[Picture of Jennifer Leonard]
[Caption] Jennifer Leonard, Customer Service Representative
OppenheimerFunds Service
"How may I help you?"
As an Oppenheimer funds shareholder, you have some special
privileges. Whether it's automatic investment plans,
informative newsletters and hotlines, or ready account
access, you can benefit from services designed to make
investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your Oppenheimer funds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
- -------------------------------------------------------------------------------
[Oppenheimer Logo]
OppenheimerFunds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
- --------------
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U.S. Postage
PAID
Permit No. 469
Denver, CO
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