---------------------------
Annual Report July 31, 1998
---------------------------
OPPENHEIMER
Cash
Reserves
[GRAPHIC OMITTED]
[LOGO]
OppenheimerFunds(R)
THE RIGHT WAY TO INVEST
<PAGE>
Contents
3 President's Letter
4 An Interview
with Your Fund's
Manager
8 Financial
Statements
23 Independent
Auditors' Report
24 Federal
Income Tax
Information
25 Officers and
Trustees
28 Information and
Services
Report highlights
- --------------------------------------------------------------------------------
o The U.S. economy has continued to grow at a healthy pace, while the Asian
economic crisis shows no signs of improving. These two opposing forces have kept
money market yields stable.
- -----------------------------
Current Yield
- -----------------------------
For the 7-Day Period
Ended 7/31/98
Class A
With Without
Compounding(1) Compounding
- -----------------------------
4.65% 4.54%
- -----------------------------
Class B
With Without
Compounding(1) Compounding
- -----------------------------
4.05% 3.97%
- -----------------------------
Class C
With Without
Compounding(1) Compounding
- -----------------------------
4.01% 3.93%
- -----------------------------
In reviewing performance, please remember that past performance does not
guarantee future results. Yields will fluctuate.
An investment in a money market fund is neither insured nor guaranteed by the
U.S. government and there can be no assurance that the fund will be able to
maintain a stable net asset value of $1.00 per share. Total returns as of
7/31/98 do not reflect substantial changes that occurred as a result of market
volatility in August and September 1998.
(1) Compounded yields assume reinvestment of dividends.
2 Oppenheimer Cash Reserves
<PAGE>
Dear shareholder,
- --------------------------------------------------------------------------------
[PHOTO]
James C. Swain
Chairman
Oppenheimer
Cash Reserves
[PHOTO]
Bridget A. Macaskill
President
Oppenheimer
Cash Reserves
The performance of the financial markets over the past several months could be
viewed as "A Tale of Two Markets." Until mid-July, the excitement surrounding
the stock market's continued ascent to new record highs overshadowed the
favorable economic environment that existed for bonds: low inflation and
declining interest rates. However, since that time, stocks have declined sharply
amid heightened volatility. Yet, the bond market remains poised to benefit from
the same positive economic conditions that existed earlier in the year.
Why have stocks faltered lately? The financial crises in Asia and Russia
have negatively affected the earnings of some large U.S. corporations and have
contributed to a slow-down in U.S. economic growth. Although slower economic
growth has been negative for stocks, it should not adversely impact bonds.
That's because slower economic growth generally means fewer inflationary
pressures and less likelihood that interest rates will rise.
What should you do during this period of relative uncertainty? If you have
well-defined long-term financial goals and an investment strategy designed to
achieve them, we encourage you to stay the course. However, if you feel your
financial plan is out-of-date or incomplete, now is the time to make
improvements. The best way to cope with short-term volatility is to adhere to a
long-term plan that contains proven strategies, such as diversification among
various financial markets, geographic regions, investment styles and individual
securities. A long-term plan will give you the focus and perspective you need to
put short-term volatility in its proper context.
As longstanding advocates of financial planning, we have been encouraged by
our shareholders' rational responses to the latest market events. Many of you
tell us that you have a long-term strategy in place, which includes diversifying
your investment portfolio among a number of different asset classes in
accordance with your tolerance for risk. At OppenheimerFunds, our portfolio
management teams include seasoned professionals who have encountered extreme
market volatility in the past, giving them the perspective required to address
risks and take advantage of opportunities in turbulent markets. In our view,
having a well-defined set of financial goals, a disciplined long-term strategy
and the help of experienced investment professionals are all fundamental parts
of The Right Way to Invest.
Sincerely,
/s/ James C. Swain /s/ Bridget A. Macaskill
James C. Swain Bridget A. Macaskill
August 21, 1998
3 Oppenheimer Cash Reserves
<PAGE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
"Remarkably, seven years into an economic expansion, U.S. inflation is now
trending below 2%."
How has the Fund performed over the past year?
In a period of excitement and volatility for stock markets here and abroad,
Oppenheimer Cash Reserves continued to provide stable returns. Particularly over
the last six months, yields moved in a very narrow range, generally between
5.50% and 5.80%. As a result, the Federal Reserve Board, which raises and lowers
short-term interest rates depending upon the outlook for inflation or recession,
remained on the sidelines. That's because the economy continued to grow, but not
fast enough to bring about inflation.
For the fiscal year ended July 31, 1998, Oppenheimer Cash Reserves Class A
Shares produced a compounded annual yield of 4.59%. Without compounding, the
corresponding yield was 4.52%. The seven-day annual yields, with and without
compounding, on July 31, 1998, were 4.65% and 4.54% respectively.(1) Over the
past 12 months, the Fund maintained a stable share price of $1.00 per share,
while providing a steady stream of monthly income.(2)
What economic factors impacted the portfolio?
Two opposing forces kept the Fed from raising or lowering rates, thus keeping
money market yields stable. On one hand, the U.S. economy has continued to grow
at a strong pace, with the unemployment rate at just 4.5% and consumer
confidence soaring. On the other hand, the Asian financial crisis shows no signs
of easing, which has weak-
(1) Compounded yields assume reinvestment of dividends. Past performance is not
indicative of future results.
(2) An investment in the Fund is neither insured nor guaranteed by the U.S.
government, and there is no assurance that the Fund will maintain a stable $1.00
share price in the future.
4 Oppenheimer Cash Reserves
<PAGE>
ened global demand for goods and services. Since the United States is a major
exporter to Asia, slackening demand and devalued currencies in the Far East have
created a dampening effect on U.S. inflation. Remarkably, seven years into an
economic expansion, U.S. inflation is now trending below 2%.
Given this scenario, how did you manage the portfolio?
Since credit quality is our first concern, we would not attempt to boost the
portfolio's yield by purchasing lower-quality securities. Such an approach
wouldn't be very fruitful in this strong economic environment, because yields on
lower quality commercial paper haven't been much higher. In addition, given the
financial crisis in Asia, we continue to avoid money market securities backed by
Japanese banks.
To be sure, there are still opportunities to add yield to the portfolio
without taking material credit risk. For example, we recently purchased a
security issued by a major insurance company that was offering a slightly higher
yield than the market for commercial paper. The security also carried a "put"
option, which gives us the right to sell the security back to the issuer at the
price we originally paid, should interest rates rise. The put option is
important, because without it, rising interest rates would decrease the
security's potential return.
5 Oppenheimer Cash Reserves
<PAGE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
What is your outlook for the Fund?
During the rest of 1998 and beyond, we will continue to monitor global events so
that we can position the portfolio accordingly. For instance, we expect that the
effects of the Asian crisis will slow down the U.S. economy in the coming
months, causing the Federal Reserve Board to lower short-term interest rates. In
such an environment, we would lengthen the portfolio's maturity to lock in
higher yields. However, if the Asian crisis diminishes and the U.S. economy
remains strong, we would expect the Fed to raise short-term interest rates in
order to keep inflation in check. In that event, we would keep the portfolio's
average maturity short, allowing us to reinvest more quickly at higher yields.
In either case, we will continue to invest conservatively, always keeping in
mind your objectives of safety and liquidity, part of our commitment to keep
OppenheimerFunds, The Right Way to Invest.
6 Oppenheimer Cash Reserves
<PAGE>
Financials
- --------------------------------------------------------------------------------
7 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments July 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
=============================================================================================
<S> <C> <C>
Certificates of Deposit--2.3%
- ---------------------------------------------------------------------------------------------
Deutsche Bank AG, 5.65%, 1/22/99 $ 3,000,000 $ 3,000,000
- ---------------------------------------------------------------------------------------------
Societe Generale, 5.87%, 9/30/98 4,000,000 4,000,121
-----------
Total Certificates of Deposit 7,000,121
=============================================================================================
Direct Bank Obligations--2.6%
- ---------------------------------------------------------------------------------------------
Abbey National North America Corp., 5.47%, 10/30/98 3,000,000 2,958,975
- ---------------------------------------------------------------------------------------------
National Westminster Bank of Canada, 5.523%, 11/2/98 5,000,000 4,928,661
-----------
Total Direct Bank Obligations 7,887,636
=============================================================================================
Letters of Credit--15.6%
- ---------------------------------------------------------------------------------------------
ABN Amro Bank PLC, guaranteeing commercial paper of Formosa
Plastics Corp., USA, Series A, 5.52%, 9/18/98 4,200,000 4,169,088
- ---------------------------------------------------------------------------------------------
Barclays Bank PLC, guaranteeing commercial paper of:
Banca Serfin SA, Institucion de Banca Multiple, Group Financiero
Serfin, 5.42%, 11/23/98 4,000,000 3,931,220
Banco de Credito Nacionale, SA, Series B, 5.42%, 8/11/98 8,000,000 7,987,956
Nacionale Financiera, SNC, 5.525%, 11/19/98 2,500,000 2,457,795
- ---------------------------------------------------------------------------------------------
Bayerische Vereinsbank AG, guaranteeing commercial paper of:
Banco de Galicia y Buenos Aires SA, 5.47%, 9/18/98 3,000,000 2,978,120
Unibanco-Unia de Bancos Brasilieros SA, Series C, 5.52%, 10/19/98 3,000,000 2,963,660
- ---------------------------------------------------------------------------------------------
Credit Suisse, guaranteeing commercial paper of:
Daewoo International (America) Corp., 5.52%, 12/2/98 3,000,000 2,943,420
Minmetals Capitals & Securities, Inc., 5.40%, 8/24/98 10,800,000 10,762,516
- ---------------------------------------------------------------------------------------------
Societe Generale, guaranteeing commercial paper of PEMEX
Capital, Inc., Series A, 5.52%, 10/2/98 5,000,000 4,952,467
- ---------------------------------------------------------------------------------------------
Swiss Bank Corp., guaranteeing commercial paper of PEMEX
Capital, Inc., 5.52%, 9/18/98 5,000,000 4,963,200
-----------
Total Letters of Credit 48,109,442
</TABLE>
8 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
=========================================================================================
<S> <C> <C>
Short-Term Notes--75.7%
- -----------------------------------------------------------------------------------------
Asset-Backed--14.1%
Asset Backed Capital Finance, Inc.:
5.68%, 9/23/98(1)(2) $ 2,500,000 $ 2,500,047
5.73%, 8/24/98(1)(2) 4,000,000 4,000,000
- -----------------------------------------------------------------------------------------
Cooperative Assn. of Tractor Dealers, Series A, 5.47%, 9/1/98 3,500,000 3,483,514
- -----------------------------------------------------------------------------------------
CXC, Inc.:
5.50%, 12/16/98(3) 5,000,000 4,895,347
5.515%, 12/7/98(3) 5,000,000 4,901,956
5.523%, 11/16/98(3) 3,000,000 2,950,753
- -----------------------------------------------------------------------------------------
Falcon Asset Securitization Corp., 5.70%, 8/4/98(3) 5,000,000 4,997,625
- -----------------------------------------------------------------------------------------
Preferred Receivables Funding Corp., 5.49%, 11/23/98(3) 3,000,000 2,947,845
- -----------------------------------------------------------------------------------------
RACERS, Series 1998-MM-3-5, 5.563%, 8/31/98(1)(2) 5,000,000 5,000,000
- -----------------------------------------------------------------------------------------
Sigma Finance, Inc.:
5.44%, 10/15/98(3) 3,000,000 2,966,000
5.44%, 9/10/98(3) 5,000,000 4,969,778
-----------
43,612,865
- -----------------------------------------------------------------------------------------
Beverages--3.5%
Coca-Cola Enterprises, Inc.:
5.48%, 10/23/98(3) 5,000,000 4,936,828
5.48%, 10/28/98(3) 2,000,000 1,973,209
5.50%, 12/21/98(3) 4,000,000 3,913,222
-----------
10,823,259
- -----------------------------------------------------------------------------------------
Broker/Dealers--21.2%
Bear Stearns Cos., Inc.:
5.45%, 10/22/98 4,000,000 3,950,344
5.47%, 10/28/98 5,000,000 4,933,144
5.505%, 12/17/98 5,000,000 4,894,487
- -----------------------------------------------------------------------------------------
Goldman Sachs Group, LP, 5.51%, 9/24/98 5,000,000 4,958,675
- -----------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc., 5.52%, 12/8/98 5,000,000 4,901,100
- -----------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc.:
5.43%, 10/14/98 4,000,000 3,955,353
5.49%, 11/6/98 5,000,000 4,926,038
5.607%, 10/8/98(1) 3,000,000 3,000,000
- -----------------------------------------------------------------------------------------
Morgan Stanley Dean Witter & Co., 5.69%, 8/3/98(1) 10,000,000 10,000,000
- -----------------------------------------------------------------------------------------
Republic New York Securities Corp., 5.94%, 8/3/98(1) 8,000,000 8,000,000
- -----------------------------------------------------------------------------------------
Salomon Smith Barney Holdings, Inc.:
5.50%, 11/16/98 7,000,000 6,885,569
5.717%, 10/20/98(1) 5,000,000 5,000,000
-----------
65,404,710
</TABLE>
9 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Commercial Finance--9.2%
CIT Group Holdings, Inc., 5.50%, 9/14/98 $ 5,000,000 $ 4,966,389
- ----------------------------------------------------------------------------------------
Countrywide Home Loans:
5.54%, 8/25/98 4,700,000 4,682,641
5.60%, 8/21/98 3,500,000 3,489,111
- ----------------------------------------------------------------------------------------
FINOVA Capital Corp.:
5.67%, 9/11/98 4,000,000 3,974,808
5.55%, 11/13/98 4,000,000 3,935,867
- ----------------------------------------------------------------------------------------
Heller Financial, Inc., 5.58%, 11/30/98 7,500,000 7,359,338
-----------
28,408,154
- ----------------------------------------------------------------------------------------
Consumer Finance--6.5%
Beneficial Corp.:
5.505%, 9/23/98 5,000,000 4,959,477
5.55%, 8/6/98 5,000,000 4,996,146
- ----------------------------------------------------------------------------------------
Island Finance Puerto Rico, Inc.:
5.51%, 9/24/98 5,000,000 4,958,675
5.57%, 8/4/98 5,000,000 4,997,679
-----------
19,911,977
- ----------------------------------------------------------------------------------------
Diversified Financial--3.2%
General Motors Acceptance Corp., 5.50%, 2/19/99 5,000,000 4,845,694
- ----------------------------------------------------------------------------------------
Household Finance Corp., 5.637%, 9/9/98(1) 5,000,000 5,000,000
-----------
9,845,694
- ----------------------------------------------------------------------------------------
Healthcare/Supplies & Services--1.6%
Baxter International, Inc., 5.56%, 8/5/98(3) 5,000,000 4,996,911
- ----------------------------------------------------------------------------------------
Insurance--10.4%
AIG Life Insurance Co., 5.668%, 8/3/98(1)(2) 7,000,000 7,000,000
- ----------------------------------------------------------------------------------------
Pacific Mutual Life Insurance Co., 5.667%, 8/3/98(1)(2) 5,000,000 5,000,000
- ----------------------------------------------------------------------------------------
Protective Life Insurance Co., 5.698%, 8/3/98(1) 5,000,000 5,000,000
- ----------------------------------------------------------------------------------------
Security Benefit Life Insurance Co., 5.686%, 8/15/98(1) 10,000,000 10,000,000
- ----------------------------------------------------------------------------------------
TransAmerica Life Insurance & Annuity Co., 5.668%, 8/3/98(1) 5,000,000 5,000,000
-----------
32,000,000
- ----------------------------------------------------------------------------------------
Leasing & Factoring--2.4%
American Honda Finance Corp.:
5.51%, 12/4/98 2,550,000 2,501,214
5.687%, 10/20/98(1)(3) 5,000,000 5,000,000
-----------
7,501,214
</TABLE>
10 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Nondurable Household Goods--2.0%
Newell Co., 5.70%, 8/3/98(3) $ 6,200,000 $ 6,198,037
- ----------------------------------------------------------------------------------------
Oil-Integrated--1.6%
Fina Oil & Chemical Co., 5.52%, 8/14/98(3) 5,000,000 4,990,033
------------
Total Short-Term Notes 233,692,854
========================================================================================
Foreign Government Obligations--1.6%
- ----------------------------------------------------------------------------------------
Comision Federal de Electricidad, Series A, 5.56%, 8/25/98 5,000,000 4,981,467
- ----------------------------------------------------------------------------------------
Total Investments, at Value 97.8% 301,671,520
- ----------------------------------------------------------------------------------------
Other Assets Net of Liabilities 2.2 6,911,136
----------- ------------
Net Assets 100.0% $308,582,656
=========== ============
</TABLE>
Short-term notes, direct bank obligations and letters of credit are generally
traded on a discount basis; the interest rate is the discount rate received by
the Fund at the time of purchase. Other securities normally bear interest at the
rates shown.
(1) Floating or variable rate obligation. 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 July 31, 1998. This instrument may
also have a demand feature which allows, on up to 30 days' notice, the recovery
of principal at any time, or at specified intervals not exceeding one year.
Maturity date shown represents effective maturity based on variable rate and, if
applicable, demand feature.
(2) Represents a restricted security which is considered illiquid, by virtue of
the absence of a readily available market or because of legal or contractual
restrictions on resale. Such securities amount to $23,500,047, or 7.62% of the
Fund's net assets. The Fund may not invest more than 10% of its net assets
(determined at the time of purchase) in illiquid securities.
(3) Security issued in an exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $60,637,544, or 19.65% of the
Fund's net assets, and have been determined to be liquid pursuant to guidelines
adopted by the Board of Trustees.
See accompanying Notes to Financial Statements.
11 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities July 31, 1998
- --------------------------------------------------------------------------------
===============================================================================
Assets
Investments, at value $ 301,671,520
- -------------------------------------------------------------------------------
Cash 621,237
- --------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 8,158,051
Interest 642,966
- -------------------------------------------------------------------------------
Other 32,246
-------------
Total assets 311,126,020
===============================================================================
Liabilities
Payables and other liabilities:
Shares of beneficial interest redeemed 1,860,246
Dividends 417,265
Transfer and shareholder servicing agent fees 170,955
Distribution and service plan fees 31,002
Other 63,896
-------------
Total liabilities 2,543,364
===============================================================================
Net Assets $ 308,582,656
=============
===============================================================================
Composition of Net Assets
Paid-in capital $ 308,587,651
- -------------------------------------------------------------------------------
Accumulated net realized loss on investment transactions (4,995)
-------------
Net assets $ 308,582,656
=============
12 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Net Asset Value Per Share
Class A Shares:
Net asset value, redemption price and offering price per share
(based on net assets of $210,476,996 and 210,538,153 shares of
beneficial interest outstanding) $1.00
- --------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $80,004,517 and 80,003,530 shares of beneficial interest
outstanding) $1.00
- --------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $18,101,143 and 18,100,638 shares of beneficial interest
outstanding) $1.00
See accompanying Notes to Financial Statements.
13 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Year Ended July 31, 1998
- --------------------------------------------------------------------------------
================================================================================
Investment Income
Interest $15,850,050
================================================================================
Expenses
Management fees--Note 3 1,368,194
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 3 1,186,442
- --------------------------------------------------------------------------------
Distribution and service plan fees--Note 3:
Class A 367,827
Class B 547,120
Class C 114,479
- --------------------------------------------------------------------------------
Shareholder reports 214,706
- --------------------------------------------------------------------------------
Registration and filing fees 142,371
- --------------------------------------------------------------------------------
Custodian fees and expenses 28,567
- --------------------------------------------------------------------------------
Legal, auditing and other professional fees 15,602
- --------------------------------------------------------------------------------
Insurance expenses 4,845
- --------------------------------------------------------------------------------
Trustees' fees and expenses 2,527
- --------------------------------------------------------------------------------
Other 8,659
-----------
Total expenses 4,001,339
================================================================================
Net Investment Income 11,848,711
================================================================================
Net Realized Gain on Investments 522
================================================================================
Net Increase in Net Assets Resulting from Operations $11,849,233
===========
See accompanying Notes to Financial Statements.
14 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended July 31,
1998 1997
=====================================================================================
<S> <C> <C>
Operations
Net investment income $ 11,848,711 $ 10,745,370
- -------------------------------------------------------------------------------------
Net realized gain 522 2,265
- -------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 11,849,233 10,747,635
=====================================================================================
Dividends and Distributions to Shareholders
Class A (8,374,810) (7,785,359)
Class B (2,871,927) (2,546,870)
Class C (601,974) (413,141)
=====================================================================================
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting
from beneficial interest transactions--Note 2:
Class A 37,506,804 2,937,563
Class B 25,995,434 (31,565,083)
Class C 8,976,542 (2,592,039)
=====================================================================================
Net Assets
Total increase (decrease) 72,479,302 (31,217,294)
- -------------------------------------------------------------------------------------
Beginning of period 236,103,354 267,320,648
------------- -------------
End of period $ 308,582,656 $ 236,103,354
============= =============
</TABLE>
See accompanying Notes to Financial Statements.
15 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
--------------------------------
Year Ended July 31,
1998 1997 1996(2)
=============================================================================
<S> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------
Income from investment operations--net
investment income and net realized gain .04 .04 .03
Dividends and distributions to shareholders (.04) (.04) (.03)
- -----------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00
===== ===== =====
=============================================================================
Total Return(5) 4.61% 4.41% 2.68%
=============================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $210,477 $172,970 $170,031
- -----------------------------------------------------------------------------
Average net assets (in thousands) $186,795 $179,948 $149,889
- -----------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.48% 4.33% 4.47%(6)
Expenses 1.28% 1.29% 1.06%(6)
</TABLE>
(1) For the period from December 1, 1993 (inception of offering) to December 31,
1993.
(2) For the seven months ended July 31, 1996. The Fund changed its fiscal year
end from December 31 to July 31.
(3) For the period from August 17, 1993 (inception of offering) to December 31,
1993. Oppenheimer Cash Reserves
(4) Less than $.005 per share.
16 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A Class B
------------------------------ -----------------------------
Year Ended December 31, Year Ended July 31,
1995 1994 1993 1998 1997 1996(2)
==============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------------------------------------------
Income from investment operations--net
investment income and net realized gain .05 .03 .02 .04 .04 .02
Dividends and distributions to shareholders (.05) (.03) (.02) (.04) (.04) (.02)
- --------------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== ===== =====
==============================================================================================================
Total Return(5) 4.84% 3.22% 2.05% 3.98% 3.82% 2.35%
==============================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $148,529 $99,361 $70,924 $80,005 $54,009 $85,573
- --------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $105,349 $87,908 $76,910 $73,003 $67,333 $49,226
- --------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.71% 3.25% 1.99% 3.93% 3.78% 3.91%(6)
Expenses 1.36% 1.32% 1.55% 1.83% 1.84% 1.61%(6)
</TABLE>
(5) Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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.
17 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights (Continued)
- --------------------------------------------------------------------------------
Class B (continued)
-----------------------------
Year Ended December 31,
1995 1994 1993(3)
==========================================================================
Per Share Operating Data
Net asset value, beginning of period $1.00 $1.00 $1.00
- --------------------------------------------------------------------------
Income from investment operations--net
investment income and net realized gain .04 .03 --(4)
Dividends and distributions to shareholders (.04) (.03) --(4)
- --------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00
===== ===== =====
==========================================================================
Total Return(5) 4.26% 2.54% 0.56%
==========================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $37,378 $46,803 $628
- --------------------------------------------------------------------------
Average net assets (in thousands) $35,360 $21,262 $454
- --------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.15% 3.05% 1.49%(6)
Expenses 1.92% 1.89% 2.12%(6)
(1) For the period from December 1, 1993 (inception of offering) to December 31,
1993.
(2) For the seven months ended July 31, 1996. The Fund changed its fiscal year
end from December 31 to July 31.
(3) For the period from August 17, 1993 (inception of offering) to December 31,
1993.
(4) Less than $.005 per share.
18 Oppenheimer Cash Reserves
<PAGE>
<TABLE>
<CAPTION>
Class C
-----------------------------------------------------------------
Year Ended July 31, Year Ended December 31,
1998 1997 1996(2) 1995 1994 1993(1)
==============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------------------------------------------
Income from investment operations--net
investment income and net realized gain .04 .04 .02 .04 .02 --(4)
Dividends and distributions to shareholders (.04) (.04) (.02) (.04) (.02) --(4)
- --------------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== ===== =====
==============================================================================================================
Total Return(5) 3.99% 3.84% 2.35% 4.21% 2.51% 0.14%
==============================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $18,101 $9,125 $11,717 $5,024 $5,604 $1
- --------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $15,297 $10,930 $6,333 $6,040 $2,107 $1
- --------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 3.94% 3.78% 3.91%(6) 4.12% 3.19% 1.18%(6)
Expenses 1.83% 1.85% 1.61%(6) 1.97% 1.90% 2.35%(6)
</TABLE>
5. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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.
19 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 by investing in "money market"
securities meeting specified quality standards. 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 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 that class and exclusive voting
rights with respect to matters affecting that 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, Gains and Losses. Income, expenses (other than
those attributable to a specific class), 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.
20 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Realized gains and losses on investments are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
================================================================================
2. Shares of Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest. Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Year Ended July 31, 1998 Year Ended July 31, 1997
---------------------------- ----------------------------
Shares Amount Shares Amount
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 724,810,258 $ 724,810,258 539,202,800 $ 539,202,800
Dividends and distributions
reinvested 7,669,695 7,669,695 7,258,877 7,258,877
Redeemed (694,973,149) (694,973,149) (543,524,114) (543,524,114)
------------ ------------- ------------ -------------
Net increase 37,506,804 $ 37,506,804 2,937,563 $ 2,937,563
============ ============= ============ =============
- ------------------------------------------------------------------------------------------
Class B:
Sold 298,115,568 $ 298,115,568 228,968,814 $ 228,968,814
Dividends and distributions
reinvested 2,362,655 2,362,655 2,072,482 2,072,482
Redeemed (274,482,789) (274,482,789) (262,606,379) (262,606,379)
------------ ------------- ------------ -------------
Net increase (decrease) 25,995,434 $ 25,995,434 (31,565,083) $ (31,565,083)
============ ============= ============ =============
- ------------------------------------------------------------------------------------------
Class C:
Sold 166,744,272 $ 166,744,272 72,171,736 $ 72,171,736
Dividends and distributions
reinvested 490,146 490,146 343,761 343,761
Redeemed (158,257,876) (158,257,876) (75,107,536) (75,107,536)
------------ ------------- ------------ -------------
Net increase (decrease) 8,976,542 $ 8,976,542 (2,592,039) $ (2,592,039)
============ ============= ============ =============
</TABLE>
21 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Continued)
- --------------------------------------------------------------------------------
================================================================================
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 0.50% on the first
$250 million of average annual net assets, 0.475% of the next $250 million,
0.45% of the next $250 million, 0.425% of the next $250 million and 0.40% of
average annual net assets in excess of $1 billion.
Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B and Class C shares totaled $457,869 and $9,700, respectively, of
which $32,713 was paid to an affiliated broker/dealer for Class B 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.
The Fund has adopted a Service Plan for Class A shares to
reimburse OFDI for a portion of its costs incurred in connection with the
personal service and maintenance of shareholder accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate that may not exceed
0.20% of the average annual net assets of Class A shares of the Fund. OFDI uses
the service fee to reimburse brokers, dealers, banks and other financial
institutions quarterly for providing personal service and maintenance of
accounts of their customers that hold Class A shares. During the year ended July
31, 1998, OFDI paid $92,868 to an affiliated broker/dealer as reimbursement for
Class A personal service and maintenance expenses.
The Fund has adopted Distribution and Service Plans for Class B
and Class C shares to compensate OFDI for its 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,
for its services rendered in distributing Class B and Class C shares. OFDI is
also authorized to receive a service fee of 0.25% per year to compensate dealers
providing personal services for accounts that hold Class B and Class C shares.
At present, these service fees are set at zero for Class B and Class C shares.
Each fee is 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 year
ended July 31, 1998, OFDI retained $547,120 and $114,479, respectively, as
compensation for Class B and Class C sales commissions and service fee advances,
as well as financing costs. If either Plan is terminated by the Fund, the Board
of Trustees may allow the Fund to continue payments of the asset-based sales
charge to OFDI for distributing shares before the Plan was terminated.
22 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 July 31, 1998,
the related statement of operations for the year then ended, the statements of
changes in net assets for the years ended July 31, 1998 and 1997, and the
financial highlights for the period January 1, 1993, to July 31, 1998. 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 July 31, 1998, 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 July 31, 1998, 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
August 21, 1998
23 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Federal Income Tax Information (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
In early 1999, shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1998. 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 July 31, 1998, 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.
24 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
Oppenheimer Cash Reserves
- --------------------------------------------------------------------------------
================================================================================
Officers and Trustees James C. Swain, Chairman and Chief Executive Officer
Bridget A. Macaskill, Trustee and President
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee
Sam Freedman, Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
George C. Bowen, Trustee, Vice President, Treasurer and
Assistant Secretary
Andrew J. Donohue, Vice President and Secretary
Carol E. Wolf, Vice President
Arthur J. Zimmer, Vice President
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
================================================================================
Investment Advisor OppenheimerFunds, Inc.
================================================================================
Distributor OppenheimerFunds Distributor, Inc.
================================================================================
Transfer and Shareholder OppenheimerFunds Services
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.
25 Oppenheimer Cash Reserves
<PAGE>
- --------------------------------------------------------------------------------
OppenheimerFunds Family
- --------------------------------------------------------------------------------
<TABLE>
============================================================================================
<S> <C> <C>
Real Asset Funds
- --------------------------------------------------------------------------------------------
Real Asset Fund Gold & Special Minerals Fund
============================================================================================
Global Stock Funds
- --------------------------------------------------------------------------------------------
Developing Markets Fund International Growth Fund Quest Global Value Fund
International Small Global Fund Global Growth & Income Fund
Company Fund
============================================================================================
Stock Funds
- --------------------------------------------------------------------------------------------
Enterprise Fund MidCap Fund Growth Fund
Discovery Fund Capital Appreciation Fund Disciplined Value Fund
Quest Small Cap Value Fund Quest Capital Value Fund Quest Value Fund
============================================================================================
Stock & Bond Funds
- --------------------------------------------------------------------------------------------
Main Street Income & Total Return Fund Disciplined Allocation Fund
Growth Fund Quest Balanced Multiple Strategies Fund
Quest Opportunity Value Fund(1) Convertible Securities Fund(2)
Value Fund Equity Income Fund
============================================================================================
Taxable Bond Funds
- --------------------------------------------------------------------------------------------
International Bond Fund Champion Income Fund U.S. Government Trust
World Bond Fund Strategic Income Fund Limited-Term Government Fund
High Yield Fund Bond Fund
============================================================================================
Municipal Bond Funds
- --------------------------------------------------------------------------------------------
California Municipal Fund(3) Pennsylvania Municipal Fund(3) Rochester Division:
Florida Municipal Fund(3) Municipal Bond Fund Rochester Fund Municipals
New Jersey Municipal Fund(3) Insured Municipal Fund Limited Term New York
New York Municipal Fund(3) Intermediate Municipal Fund Municipal Fund
============================================================================================
Money Market Funds(4)
- --------------------------------------------------------------------------------------------
Money Market Fund Cash Reserves
</TABLE>
(1) On 5/18/98, the Fund's name was changed from "Quest Growth & Income Value
Fund."
(2) On 4/28/98, the Fund's name was changed from "Bond Fund for Growth."
(3) Available only to investors in certain states.
(4) An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency. Although
these funds may seek to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in these funds. Oppenheimer
funds are distributed by OppenheimerFunds Distributor, Inc., Two World Trade
Center, New York, NY 10048-0203.
(C) Copyright 1998 OppenheimerFunds, Inc. All rights reserved.
26 Oppenheimer Cash Reserves
<PAGE>
<PAGE>
Information and services
- --------------------------------------------------------------------------------
Internet
24-hr access to account
information. Online
transactions now available
- -------------------------
www.oppenheimerfunds.com
- -------------------------
General Information
Mon-Fri 8:30am-9pm ET
Sat 10am-4pm ET
- -------------------------
1-800-525-7048
- -------------------------
Account Transactions
Mon-Fri 8:30am-8pm ET
- -------------------------
1-800-852-8457
- -------------------------
PhoneLink
24-hr automated information
and automated transactions
- -------------------------
1-800-533-3310
- -------------------------
Telecommunication Device
for the Deaf (TDD)
Mon-Fri 8:30am-2pm 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
- -------------------------
As an Oppenheimer fund 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 or by visiting our website. 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 or website 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, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
[LOGO]OppenheimerFunds(R)
Distributor, Inc.
RA0760.001.0798 September 29, 1998
